Inter Partes Review

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PTAB’s Limited Discovery Practices Emphasized in IPR

Parties to an Inter Parties Review (IPR) proceeding may obtain “limited discovery” at the USPTO’s Patent Trial & Appeal Board (PTAB). Such discovery is limited as it must fall in an accepted class of discovery, namely, “routine discovery” or “additional discovery.”See Rule § 42.51. Routine discovery is generally categorized as: (1) any exhibit not otherwise publicly available or served, (2) cross examination of a declarant, and (3) non-cumulative information that is inconsistent with a position taken by the party before the PTAB.

“Additional discovery” defines everything outside of the above noted categories. To seek such additional discovery in an IPR an “interest of justice” need must be demonstrated…quite difficult in all but the most exceptional of circumstances.

As IPRs are patentability trials based on publicly available patents and printed publications, categories (2) and (3) of routine discovery provide the only significant opportunity for discovery. Of course, category (2) is straight forward enough—if there is a declarant submitting testimony— that declarant can be deposed. This leaves category (3) which, as I predicted last April, will be cited by patent owners seeking to embark on district court style fishing expeditions in the name of purported “secondary considerations of non-obviousness.” As made clear last week in the very first IPR filing, IPR2012-00001 (Garmin International Inc, et al v. Cuozzo Speed Technologies LLC) the PTAB is having none of it. (here)…

Continue Reading PTAB Denies District Court Style Discovery Antics

trollSince the enactment of the America Invents Act (AIA) in September of 2011, the “patent reform” embodied by the AIA has been slowly rolling out. In fact, the bulk of the truly significant changes to patent law are only months old, some still weeks away. These changes include the change over to the first inventor to file model on March 16th, and the kick off of the new post grant patent proceedings 6 months back. With so much recent change it would seem premature to consider further changes to patent law until the last round has had time to take effect…but politicians disagree.

Evidently at least one Congressman feels that the AIA does not go far enough to combat patent “troll” lawsuits. Congressman Defazio of Oregon is sponsoring yet another bill entitled “Saving High-Tech Innovators From Egregious Legal Disputes Act.” The bill, like its 2012 predecessor, proposes that the costs (including attorney fees) of certain types of patent lawsuits should be recoverable from the Patentee once the court finds the patent invalid, or not infringed. The 2012 version of the bill was limited to software type inventions and mandated payment for only frivolous suits. 
Continue Reading Loser Pays Patent Troll Legislation Flawed

11th Amendment Immunity from DJ Action Does Not Extend to USPTO

State university technology transfer programs enjoy immunity from declaratory judgment (DJ) actions of patent invalidity/non-infringement. This is because state entities qualify for 11th amendment immunity from suits in federal district courts. So, absent the rare waiver of 11th amendment immunity, licensing targets of state university technology transfer programs have no recourse to proactively challenge the subject patents in the federal district courts.

The immunity benefit enjoyed by such state-run technology transfer licensing programs was most recently made clear in Cyanotech Corp. v. Valensa Intl. & The Univ. of Ill. (D.Haw) (here) In Cyanotech, the DJ action against the Univ. of Illinois was dismissed based on 11th amendment grounds.

Yet, a DJ action in the district courts is not the only avenue to challenge the validity of an issued patent in a forum more favorable to potential licensees. As demonstrated by early filings at the USPTO’s Patent Trial & Appeal Board (PTAB) universities are increasingly the target of Inter Partes Review (IPR) Filings. …
Continue Reading University Technology Transfer Licensing Programs Challenged at PTAB

Settling IPROne of the more intriguing provisions of the new post grant patent proceedings of the America Invents Act (AIA) is the ability to settle these patentability disputes by agreement. Unlike existing patent reexamination practices, the USPTO will terminate an Inter Partes Review (IPR), Post Grant Review (PGR), or Transitional Proceeding for Covered Business Method Patents…

Estoppel Arising from Inter Partes Review (IPR) Will Have Minimal Practical Impact

The new patentability trial proceedings of the Patent Trial & Appeal Board (PTAB) have been met with great enthusiasm by many science and technology innovators as the first true alternative to patent litigation; especially those faced with costly “patent troll” assertions. Still, there are a small minority of patent challengers that look on these “new” proceedings with great fear and skepticism. These naysayers will often dismiss the speedier, lower cost PTAB proceeding as being too much of an estoppel risk.

The estoppel concern is almost always distilled down to two unenlightened propositions. That is, a fear of a “new, untested and unpredictable” proceeding, and the belief that the USPTO may somehow give short shrift to the submitted prior art.

Both criticisms are easily demonstrated as misguided.
Continue Reading Specialized Patent Judges Vs. The Eastern District of Texas Plumber

USPTO Post Grant & PTAB Updates

In recent weeks the USPTO has issued updates on various aspects of post grant patent practice and PTAB performance. The PTAB reports that their significant backlog has not only stopped growing, but will soon begin shrinking thanks to the increased hiring of administrative patent judges (APJs). With a typical ex parte application appeal pending 2-3 years in many cases, this is welcome news for appellants. (presentation here)

On the post grant side, an update was provided on patent reissue practice. The presentation mostly recapped recent case law developments and changes to oath practice. (presentation here)

An update was also provided from the PTAB Trial Section on the patentability trials of the America Invents Act (AIA).
Continue Reading PTAB Updates on Post Grant Filings & Decreasing Backlog

Demand for IPR Driven by Patent Troll Assertions

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 there has been a robust demand for these proceedings with over 120 petitions filed in the first few months—many of which target NPE portfolios. This filing rate is equal to about one IPR petition per business day. The USPTO is estimating that as many as 300 petitions will be filed in the first 12 months of availability. This filing rate would be consistent with the demand for the predecessor proceeding, inter partes patent reexamination.

As a reminder, IPR allows challenges to suspect patents of any vintage in a speedier, more cost effective, and challenger friendly manner relative to that of the federal district courts. That is to say, for the very first time, there is a true, accelerated alternative to patent litigation. 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.

Breaking down the petitions to date,…
Continue Reading Patent Trolls Drive Demand for New AIA Post Grant Proceedings

Stayed Litigations to Drive Joinder Practice

Inter partes reviews (IPRs) are now understood to be effective tools for parties defending against patent infringement suits filed by non-practicing entities, sometimes called “patent trolls.” Typically patent trolls launch suits against multiple entities and district courts commonly consolidate such cases for purposes of discovery. In some cases, this leads to the formation of joint defense groups, which provide various efficiencies and advantages on the litigation side of the fence. However, joint defense group members almost always have differing views when it comes to the decision whether and when to file an IPR.

In the typical situation, a “deep pocket” defendant with the most to lose will move forward in filing the IPR, then move to stay the costlier litigation proceeding. The Patentee will then oppose the motion, pointing out that the litigation is unlikely to be simplified by a stay because any potential estoppel stemming from the IPR is binding only with respect to the real party in interest (i.e. deep pocket filer). Faced with the prospect of the motion for stay being denied on this ground, the remaining defendants will begrudgingly stipulate to be bound by the same estoppel as that attaching to the real party in interest. Yet, this stipulation now places such defendants in the unenviable position of being bound by a proceeding they may not have wanted in the first instance.

In the past case of inter partes patent reexamination, such “me too’ defendants were forced to sit on the sideline and place their fate in the hands of the real party in interest; such situations proved quite problematic. For example, should the deep pocket defendant settle with the Patentee, the reexamination could then proceed unopposed and the inter partes reexamination would transform into a statistically less desirable, pseudo, ex parte reexamination proceeding. In other words there was no way for the other defendants to secure a right to participate along side the real party, or substitute themselves in the place of the real party should settlement occur— not so in IPR.
Continue Reading Multi-Defendant Troll Suits to Drive Joinder Filings at PTAB

First IPRs Advancing at Light Speed

The PTAB has now issued several decisions instituting trials. The initial decisions suggest that post-grant practitioners may in many instances receive a final written decision in about a year from petition filing (rather than about 18 months as initially projected) and that the PTAB decisions instituting trials will provide useful findings regarding claim construction roughly 4-5 months from the time of petition filing.

For instance, the PTAB granted the IPR petition filed by Garmin in early January and has the oral hearing set for August 16th.  That should yield a final written decision in 12-13 months from the filing date of the petition. In that case the patent owner waived its right to file a preliminary response but waited almost the full three months before it did so. If the patent owner had promptly filed a waiver of the preliminary response that would have sped up the entire process by about three months.

This suggests that the PTAB intends to remain true to its stated intention of moving these patentability trials along at a brisk pace (even faster than that required by the controlling statute, 12-18 months from institution). The PTAB is well aware that…
Continue Reading PTAB Trial Proceedings Will Outpace Copending Litigation