Scott McKeown

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inter partes reviewBusiness executives routinely wrestle with whether to defend a patent infringement suit in court, settle the dispute for less than the cost/risk of defending it (especially in the case of patent “troll” suits), or seek the help of the USPTO to address the problem patent via a post grant patent proceeding. Patent litigation is a well-worn path and the variables and risks associated with it are relatively well understood. The same can, to an extent, be said of patent reexamination at the USPTO. But now that inter partes reexamination has been replaced with inter partes review (IPR), an entirely new mechanism of the America Invents act, CEOs and CFOs around the world are asking how this new option alters the existing landscape.

The primary business distinctions between IPR and court proceedings are cost, predictability, effectiveness, and speed. With respect to cost, according to statistics published by AIPLA and others defending a patent lawsuit through trial costs well in into the millions of dollars for cases involving substantial financial exposure. IPR, in the vast majority of cases, will cost in the hundreds of thousands of dollars. As a business rule of thumb,
Continue Reading CEO’s Guide to Avoiding Patent Litigation Costs

Functional Claim Drafting Practices Considered by USPTO

Despite public misconceptions to the contrary, software is not patentable. Of course, aspects of software, or “software related” patents exist in which an otherwise statutory apparatus or product is claimed that includes computer implemented functionality. In an effort to enhance the “quality” of these software related patents, the USPTO issued a notice last Thursday in the Federal Register entitled: Request for Comments and Notice of Roundtable Events for Partnership for Enhancement of Quality of Software Related Patents.

The Notice “sets forth several topics to begin the Software Partnership discussion. The first topic relates to how to improve clarity of claim boundaries that define the scope of patent protection for claims that use functional language.”

Reading through the tea leaves, the USPTO appears quite interested in exploring means-plus-function claiming with the software community. Since this style of claiming directly links the disclosed structure of the patent specification (algorithmic in the case of computer implemented features), it may be that the Office is proposing to rein in the scope of software claims by requiring the more narrow claim type. Thus, the “enhancement in quality” may result in future software related patents becoming more difficult to assert based on their narrower scope. To this end, the USPTO proposed the following talking points for the upcoming roundtable:…
Continue Reading USPTO to Require Means Plus Function Claims for Software Related Patents?

Rippling Effect of PTAB Proceedings to Upset Patent Litigation Business Model?

Opponents of the U.S. patent system are quick to deride the America Invents Act (AIA) as a failure when it comes to the so called “patent troll” or “non-practicing entity” (NPE) problem. Indeed, a steady stream of news articles from otherwise reliable sources such as the Wall Street Journal only serve to sensationalize and reinforce this misperception. Most such articles will focus on what has happened prior to September 16, 2012 (i.e., failure of the joinder rules) as opposed to what is now happening as a result of the AIA.

On September 16th, 2012 the new post grant patent proceedings of the America Invents Act (AIA) became available to patent challengers for the first time. These proceedings have only been available for a few months, but allow challenges to suspect patents of any vintage in a far more speedier, cost effective, and challenger friendly manner relative to that of the federal district courts. The idea behind these proceedings is that for the very first time, there will be a true, accelerated alternative to patent litigation. Not surprisingly, there has been a robust demand for these proceedings with over 100 petitions filed in the first few months—many of which target NPE portfolios. The new post grant proceedings of the USPTO’s Patent Trial & Appeal Board (PTAB) will conclude in a fast enough time (12-18 months) to transform the existing litigation landscape in a manner that will significantly undermine the NPE patent litigation business model.

The impact of these new, AIA post grant proceedings are only now beginning to be felt in the district courts.
Continue Reading AIA Post Grant Proceedings Begin to Impact NPE Assertions

Business-to-Business Initiative Drives Government Interest

Small technology companies and start-ups face a daunting task in enforcing their intellectual property due to the cost prohibitive nature of patent litigation. In year’s past academics and major bar associations would often brain storm as to how these market participants (as opposed to NPEs) might be able to cost effectively get a fair shake in the U.S. patent system. Back in 1989, an idea was floated that perhaps the government could help out by establishing a small claims court of sorts to allow such small players an opportunity to prove their case.

For example, where relatively small amounts of licensing revenue/damages are at stake, (e.g., 3 million or less)  it is frustrating for small organizations to be faced with a legal bill of equal value to the potential recovery. Although these goals are far from clear in this week’s Federal Register Notice (here), the USPTO  is soliciting commentary on the concept of creating a small claims court that would be voluntary in nature, likely exclude NPEs, and focus on small (a few million or less) business-to-business disputes…
Continue Reading USPTO Solicits Comments on Small Claims Court for Patent Disputes

H.R. 6621 Revised to Exclude Reissued Patents from 9 Month Post Grant Review Window

As reported earlier this month, Congress is currently considering a technical amendment to the America Invents Act (AIA). House Bill H.R. 6621 is being proposed by Congressperson Lamar Smith (R-Tx) to correct several “technical” aspects of the AIA. On the…

Concurrent Post Grant Proceedings with the Same Real Party in Interest

One of the more intriguing aspects of the new patentability trials of the America Invents Act (AIA) is their potential interplay with legacy post grant proceedings such as patent reissue, ex parte and inter partes patent reexamination. In formulating the rules to implement the new AIA proceedings, namely, Inter Partes Review (IPR), Post Grant Review (PGR) and the Covered Business Method (CBM) review, the USPTO did not specifically define how conflicting proceedings would be processed. For example, the first half of 35 U.S.C. § 325(d) explains that the Board may provide for the “stay, transfer, consolidation, or termination” of either of the conflicting proceedings. Exactly how those determinations would be made was explained as a “case-by-case basis.”

The first PTAB proceeding to examine such issues is IPR 2013-00033. In this proceeding, CBS Interactive petitioned for IPR of patent 7,155,241, assigned to Helferich Patent Licensing. The petition challenged several of the patent’s dependent claims. Concurrently, an inter partes patent reexamination (95/001,864) is also pending, challenging all the of independent claims in the patent. The IPR and reexamination did not challenge any of the same claims, but the same real party in interest asserted some of the same grounds of unpatentability with respect to the same prior art.  In examining the potential conflict between the proceedings, the PTAB opted to stay the reexamination proceeding pending termination/completion of the Review, explaining:…

Continue Reading Patent Trial & Appeal Board Shuts Down Patent Reexamination

USPTO Reports Early Popularity….But Will it Last?

The America Invents Act (AIA) provides patent challengers with the most robust mechanisms ever offerred to challenge a U.S. patent at the USPTO. Yet, these challenges come at significant cost. A far lesser known provision of the AIA permits challengers to submit prior art materials to the USPTO before the patent even issues…in some cases, anonymously, and for free.

As of September 16th, for any pending application, 37 C.F.R. § 1.290 provides that a third party may submit written prior art, together with an explanation of relevance, to the USPTO. The submission must contain (1) a concise description of relevance, in some cases, a $180 fee, and (2) a statement affirming compliance with the necessary statute (35 U.S.C. 122). As to timing, the submission must be filed before a notice of allowance, or if not allowed, before six months after publication or rejection of any claim, whichever is later. Thereafter, the examiner should consider the submitted art in the usual manner.

In essence, Rule 290 is designed to improve and replace the old Rule, 37 C.F.R. § 1.99 submissions. Rule 290 provides a larger submission window, and, perhaps more importantly, an explanation of relevance is permitted. When considering that a party’s first submission is free, and may be filed anonymously, the option appears quite attractive. However, early adopters of this new mechanism may find that, as always, “you get what you pay for.”  …

Continue Reading Third Party Submissions in Published Patent Applications

Terminal Disclaimer Permanent Once Patent Issues

Back in January of 2011 I discussed the appeal decision in Ex parte Shunpei Yamazaki relative to patent reissue practice. In Yamazaki, a reissue patent application was filed shortly after issuance of U.S. Patent 6,180,991 for the purpose of withdrawing an earlier filed terminal disclaimer.

By way of background, the ‘991 patent issued on January 30, 2001 (based upon an application filed April 21, 1995). During the original prosecution, a terminal disclaimer was filed (November of 1996) to overcome a double patenting rejection. Thereafter, the claims subject to the earlier double patenting rejections were amended. Since the amended claims were believed to be distinct from those of the earlier patent, the Applicant petitioned to withdraw the earlier filed terminal disclaimer (April 1999). The petition remained pending for some 20+ months at the USPTO, but, the patent issued prior to any USPTO action on the petition filing. The petition was ultimately dismissed as moot once the ‘991 Patent issued.

Adding insult to injury, the USPTO explained in their belated petition decision that a terminal disclaimer could not be removed once a patent issues as patent reissue did not contemplate such mistakes as “error” under the reissue statute. In other words, even though the patent holder had disclaimed some 14 years of patent term by mistake, there was no mechanism to cure that mistake post issuance. Nevertheless, the Patentee filed a patent reissue application in an attempt to withdraw the terminal disclaimer.

In deciding the propriety of a patent reissue proceeding to remove a terminal disclaimer, an expanded panel of the BPAI (now PTAB) held that patent reissue could not reset the term of the original patent (which was set by the disclaimer). Interestingly, the BPAI decision also included concurring opinions that would have held differently had the patent not expired prior to completion of the reissue proceeding (December 2003).

Last week, the CAFC affirmed the USPTO, and made clear that patent reissue cannot withdraw a terminal disclaimer, even if the reissue proceeding were capable of concluding prior to expiration.
Continue Reading Patent Reissue Cannot Cure Mistaken Terminal Disclaimer