Bill Released – Iancu Era Rebuked

Well, the wait was not that long after all.  Senator Leahy -VT (D) (with co-sponsor Senator Cornyn – Tx (R)) has today released the draft bill entitled “Restoring the America Invents Act.”  The bill includes most of what I expected, with a handful of additional tweaks.

Below is a brief overview of all of the proposed changes.

The bill (here) proposes limiting PTAB discretion to 325(d) only, and adjusting the statutes in view of Arthrex.  But PTAB practitioners will notice quite a few noteworthy proposals in the complete list below:

  1. Arthrex fix – 35 USC § 6 amended; language added to make clear Director to issue opinion explaining rehearing decision.  Agency will issue rules to outline rehearing process and timeline (but likely 120 day process).
  2. Return Mail overruled to allow government entities to file AIA trial petitions.
  3. Expanding IPR/PGR jurisdiction to include Obviousness-Type Double Patenting and the use of Patentee admissions (in spec, drawings or claims).
  4. Overruling Click-to-Call (i.e., dismissal of litigation without prejudice restarts one-year window).
  5. If new claims are added to a patent by reexamination or reissue, even if petitioner is outside of its window, those claims get a fresh window.
  6. Stay request is given CBM stay controls (extra factor that militates in favor of stay, and interlocutory, de novo review of stay denials).
  7. Exception to estoppel for Joined parties overruled.
  8. PTAB given jurisdiction over continuation applications sharing a same priority date.
  9. Multiple proceedings are to be consolidated, merged or stayed.  Reexam cannot be favored over an AIA trial.
  10. Estoppel no longer attaches at FWD, but after all appeals exhausted (and does not apply to unpatentability findings, or “winner estoppel”)
  11. The USPTO may not issue indistinct claims to a claim found unpatentable in an IPR/PGR.
  12. PTAB judges may not communicate with superiors on case specifics except as allowed by the Code of Conduct for Unites States Judges.
  13. Aqua Products overruled, burden on patentee to prove patentability of amended claims.
  14. Board must also examine amended claims, and PTO can charge a fee for such.
  15. Issue a certificate cancelling claims within 60 days of final appeal decision or abandonment.
  16. Re-hearings must conclude within 120 days after FWD.
  17. Standing – an injury in fact is presumed if estoppel is harmful (I’m paraphrasing).  If no standing, no estoppel.

Well, that is quite the list.  I think with the exception of 7, all are pro-petitioner changes (1, 12, 15 and 16 being fairly neutral).

Number 6 is plainly the most controversial. This would virtually ensure that any litigation with an AIA trial would be stayed. Even if a judge wanted to continue, the interlocutory appeal would put even the fastest court behind the PTAB in terms of timing (given the appeal delay).  Interestingly, the ITC would not be covered by the stay language (no civil actions there). Of course, that can be tweaked going forward.  If not, and it passes, the ITC will see a HUGE increase to its docket.

Other changes include the shifting of estoppel from the time of the FWD to the time of final appeal (in practice this probably makes the most sense).  Another stand-out for me is the attention paid to continuation applications and indistinct claims.  While there are rule-based controls in place to address these issues at the USPTO, they are not followed.  Addressing this issue in the statute will change that agency practice.

In case you aren’t reading between the lines, this Bill would erase virtually all of the changes made under former Director Iancu, save a small handful (Philips construction, sur-reply brief). I don’t expect this bill to pass in current form (obviously), and items 3 and 6 will be the focus of much opposition. That said, Arthex, the elimination of 314 discretion, and a number of these provisions are very likely to be passed into law as a way to combat high-drug prices.  There is significant bipartisan support for such, and that is how this bill we be sold to the American public.

Stay tuned.