Winter 2012 – New Rules

Early 2012 is shaping up to be an exciting time for patent law, particularly for those focused on post grant patent practice.

USPTO–As to the new rule packages necessary to implement the new post grant mechanisms of the America Invents Act (AIA), it is rumored that the supplemental examination rules will issue this week. Due to an administrative delay with the Office of Management & Budget (OMB), the more extensive IPR and PGR rule packages are expected to publish next week. Earlier this month, some less extensive rules packages issued on patent reissue oath practice and changes to ex part patent reexamination practice.

CAFC– The court has agreed to reconsider Marine Polymer Technologies, Inc. v. HemCon, Inc. (here) en banc. As a reminder, this case considers whether or not intervening rights are created for a claim that is not literally amended in a post grant proceeding by a change in verbiage, but instead, by Patentee disclaimer. (earlier post here)

The court also has yet to issue a decision in In re Staats, which presents the USPTO theory that continuation filings in a broadening patent reissue must relate to a broadening that was foreseeable as presented in the original oath.

There is much to look forward to in the weeks to come.

Willfullness Determination Opens Door to Prejudice

One purpose for introducing evidence of an ongoing patent reexamination in a parallel litigation is to avoid a post filing (i.e., complaint) willfulness determination. The existence of an ongoing patent reexamination may be admitted to demonstrate that the accused infringer was not objectively reckless in its actions irrespective of its prior knowledge of the asserted patent.

Some courts have found that reexamination evidence defeats a finding of willfulness, these courts typically examine the status of the claims in the reexamination proceeding at the time of the willfulness determination, finding that the weight of the reexamination evidence depends on whether the reexamination proceedings are complete and whether the patent claims have undergone substantive changes in reexamination. When seeking introduction of such evidence, depending upon the court, the stage of the parallel litigation (Summary Judgment, JMOL, Pre-Trial Motions) may determine whether or not it is admissible.

In recent years, courts have been reluctant to admit evidence of an ongoing patent reexamiantion at trial. This is because the presumption of validity may be undermined by communicating to the factfinder(s) that the USPTO has changed their mind. This trend is especially prominent in plantiff forums such as Texas. 

Last week, in Imaginal Systematic, LLC v. Leggett & Platt, Inc., et. al., (CACD), the California court expressed a different perspective:

Plaintiff’s Motion in Limine No. 3 seeks an order excluding any evidence relating to the inter partes reexamination proceedings. Plaintiff contends that this evidence is irrelevant and unfairly prejudicial. To the extent the evidence is offered to refute willful infringement allegations, the Court disagrees with Plaintiff’s argument. The evidence relating to the reexamination involves more than the mere fact that the U.S. PTO is reexamining the patents-in-suit. Rather, the evidence includes the fact that the proceedings have reached a stage where U.S. PTO has made findings as to the validity of the subject claims. These findings are directly relevant to whether there was an objectively high likelihood that the patents-in-suit were valid.

As is always the case with patent reexamination and parallel litigation, depending upon the court, your mileage may vary.

Post Grant Practice CLE

Today the AIPLA continues their multi-part web series on the America Invents Act (AIA). In the latest installment, the new post grant mechanisms of the AIA will be explored. The program is entitled Post-Issuance Activities and Enforcement Activities Under the America Invents Act.

Registration info is found (here)

For additional CLE credit in 2012, consider the following programs:

Post Grant Proceedings 2012 — The New Patent Litigation Practicing Law Institute, February 3, 2012 (NYC & Webinar)

Salvaging Patents with New Supplemental Examination Strafford Legal February 14th (Webinar)

USPTO Procedures Under the America Invents Act American Conference Institute March 26-27th (NYC & Webinar)

Troublesome Oath Requirements Revised

As anyone that has ever filed a patent reissue can attest, the inconsistent application of oath requirements can be maddening. In fact, the vast majority of patent reissue applications are delayed due to such informalities —aggravating an already significant problem.

As the America Invents Act has required that the “deceptive intent” component of patent reissue oaths be stricken, the USPTO has taken the opportunity to fix a few other problems while they were under the hood. Last Friday, a Notice of Proposed Rule making entitled “Changes To Implement the Inventor’s Oath or Declaration Provisions of the Leahy-Smith America Invents Act.” (here)

Major Changes, include:

(1) Delete the requirement for a reissue oath or declaration to include a statement that all errors arose without any deceptive intent on the part of the applicant;

(2) Eliminate the requirement for a supplemental oath or declaration when a claim is amended, and require a corrected oath or declaration only where all errors previously identified in the reissue oath or declaration are no longer being relied upon as the basis for reissue;

(3) Require applicants to specifically identify any broadening of a patent claim, rather than merely provide an alternative statement that applicant is correcting an error of either claiming more or less than a patentee was entitled to claim;

(4) Clarify that a single claim containing both a broadening and a narrowing of the claimed invention is to be treated as a broadening. These changes will provide for more efficient processing of reissue applications and improve the quality of patents, in accordance with the intent of the Leahy-Smith America Invents Act.

(5) In order to implement the conforming amendment made to 35 U.S.C. 251 in Section 4(b)(2) of the Leahy-Smith America Invents Act, the Office is also proposing to amend the rules to permit an assignee of the entire interest who filed an application under 35 U.S.C. 118 that was patented to sign the reissue oath or declaration in a reissue application of such patent (even if the reissue application is a broadening reissue).

(6) Liberalize the use of duplicate oaths in continuation reissue applications.

Additional rules packages detailing procedures for implementing IPR and PGR are expected next week.

Ex Parte Patent Reexamination Practices Adjusted to Account for Estoppel

The new estoppel provisions of Inter Partes Review (IPR) and Post Grant Review (PGR) differ from the previous estoppel provisions of inter partes patent reexamination in that they not only prevent a subsequent request for IPR/PGR from the same requester (or privies) on issues that were raised or reasonably could have been raised in the first proceeding, but prevent the filing or maintenance of any other “office proceeding.”

By definition a Post Grant Review (PGR) can only be conducted prior to an IPR. This is because an IPR can only be filed once the 9 month PGR window has ended, or after any ongoing PGR concludes. As such, the primary office proceeding that can be requested, or maintained in this regard (i.e., after IPR/PGR estoppel attaches) is ex parte patent reexamination (EXP).

As pointed out previously, in order to properly estop an ongoing EXP proceeding or filing, the Office must implement a system to track EXP filings with respect to the real party in interest. This tracking is complicated by the fact that many EXP proceedings are filed anonymously. Last Thursday, the USPTO issued their plan. In the Notice of Proposed Rulemaking for Changes to Implement Miscellaneous Post Patent Provisions of the Leahy-Smith America Invents Act (here), the Office proposes the following mechanisms to track potential EXP estoppel.

(6) A certification that the statutory estoppel provisions of both inter partes review (35 U.S.C. 315(e)(1)) and post grant review (35 U.S.C. 325(e)(1)) do not prohibit the ex parte reexamination.

(7) A statement identifying the real party(ies) in interest to the extent necessary to determine whether any inter partes review or post grant review filed subsequent to an ex parte reexamination bars a pending ex parte reexamination filed by the real party(ies) in interest or its privy from being maintained.

In essence, EXP filers must, once the proposed rules become effective, certify that IPR and PGR estoppel do not apply to their filing. Likewise, anonymous filers must disclose their identity to the agency, under seal. The Notice provides in more detail that:

An ex parte reexamination requester has the option to remain anonymous. In order to do so, the requester must: (1) Submit the statement identifying the real party(ies) in interest as a separate paper; (2) title the paper as a statement identifying the real party(ies) in interest; (3) request in the paper that the Office to retain the paper in confidence by sealing it; and (4) include, in a clear and conspicuous manner, an appropriate instructional label designating the statement as a non-public submission, e.g., NOT OPEN TO THE PUBLIC FOR OFFICE USE ONLY. The Office will then maintain the real party(ies) in interest statement as a sealed, non-public submission

The Notice also clarifies that statements submitted under Rule 1.501(a)(2) (Patent Owner Statements and associated information on claims cope) may only be used to interpret claims once reexamination has been ordered, they may not be used to form an SNQ.

New Rules for Ex Parte Practice Effective January 23rd 2012

For those seeking a quick briefing on the new Rules of Practice Before the Board of Patent Appeals & Interferences in Ex Parte Appeals. The Practicing Law Institute (PLI) will be offering a one hour webinar next Monday, January 9, 2012.

Topics to be covered include:

  • New petition practice to toll Reply Briefing deadlines

  • Simplification of brief formatting and required appendices

  • New default practices and assumptions

  • Guidelines for identifying “new rejections”

  • New jurisdictional timing

  • Elimination of examiner responsibilities

I will be presenting along with my colleague (former Administrative Patent Judge and USPTO solicitor) Lee Barrett.

Registration details are found (here)

settlement agreement

Parallel Litigation Settles, Now What?

With the vast majority of patent reexaminations now being conducted concurrent to a district court or ITC proceeding, a common question of Patentees is “what becomes of the patent reexamination once the litigation settles?”

In the case of ex parte patent reexamination, the answer is simple: the reexamination continues unaffected. Indeed, as demonstrated a few weeks back (In Re Construction Equipment, CAFC (2011)), the ultimate outcome of the ex parte reexamination can even effectively reverse an earlier decision of the CAFC.

On the other hand, if the pending reexamination is an inter partes patent reexamination (IPX), the answer will depend on the nature of the terms of the settlement agreement. In a best case scenario for Patentee, the IPX proceeding may be vacated altogether by operation of estoppel. Of course, to trigger IPX estoppel, the settling defendant/requester must agree to a consent consent judgement in the district court (not effective in the ITC as estoppel does not apply) that they failed to prove invalidity. In most cases, defendants are loathe to publicly admit defeat. Still, unwary Patentes may be walking away from significant opportunity if just swinging for the fences. Continue Reading Settlement Agreements & Patent Reexamination

Top Stories of 2011

2011 was perhaps the most significant year to date in terms of post grant patent practice. The perennial legislative effort generally known as “patent reform” finally bore fruit as the Leahy-Smith America Invents Act (AIA); patent reexamination filings in 2011 reached an all time high; patent reissue practice was explored and clarified by the CAFC; and patent litigation parallel with patent reexamination continues to expand as a well established strategic practice.

As to the America Invents Act, several entirely new post grant patent proceedings have now been enacted into law (effective September 16, 2012).  A summary of these proceedings, and discussions of their expected impact are linked below (and throughout the blog).

Post Grant Review

Inter Partes Review

Supplemental Examination

Derivation

Transitional Business Method Patent Challenge

The USPTO is scheduled to issue a notice of proposed rule making on these proposed proceedings within the next 2-3 weeks. 2012 will bring much more detail to the broad legislative concepts found in the AIA.

As to patent reissue, the CAFC has clarified the scope of error necessary for patent reissue (Ex Parte Tanaka) and has addressed the complexities of the recapture doctrine (Ex Parte Mostafazadeh). The CAFC is expected to issue their decision in Ex Parte Staats, another important patent reissue case, in the coming weeks.

Patent reexamination has been impacted by the passage of the AIA in that the SNQ standard is now available only for ex parte patent examination. Likewise, the USPTO has proposed their own changes to patent reexamination practice to decrease pendency. With the passage of the AIA, it is unclear where this earlier proposal now stands.

2012 is expected to bring even further attention to post grant patent practice as it expands and matures under the new legislation. Stay tuned.

BPAI Reverses Rejections on CAFC Claim Construction

The seemingly never ending saga of the NTP patent reexaminations took yet another interesting turn yesterday. The BPAI issued revised decisions on remand that reversed the earlier rejections of some of the NTP claims. As a reminder, the reexamination of the NTP patents began during the litigation between NTP v. RIM.  The reexaminations continued at the USPTO in parallel with the then ongoing, and now infamous, litigation.  However, the co-pending litigation continued on to the settlement, narrowly avoiding a disruption of RIM’s business in the U.S via court imposed injunction.

Now, some 6+ years later, the reexaminations may be close to a conclusion (absent further appeal by NTP).

The revised decisions stem from the CAFC remand on claim construction issues relating to the definitions of “electronic mail” or “electronic mail message.” As a result of the revised construction, NTP has manged to claw back some of their previously rejected claims. The chart below shows the current status of the NTP portfolio as of yesterday, the decisions are linked here: 5,436,960; 5,438,611; 5,479,472; 5,625,670; 5,631,946; 5,819,172; 6,067,451; and 6,317,592 (not yet issued)

LEGEND:

-Green claims were newly confirmed/allowed as a result of yesterday’s decisions

-Black claims have been confirmed/allowed since the first decision of the BPAI

-Underlined claims are confirmed/allowed, but were added as new claims during the reexamination.

(CLICK TO ENLARGE)

NTP Reexaminations

NTP entered the patent reexamination process with over 2200 claims. The underlined claims were added in patent reexamination, which means they do not exist until printed at the conclusion of the reexamination. For many, if not all of these newly added claims, it is simply too late. This is because some of the underlying patents expired in May of 2011. Once a patent expires, new claims cannot be added….however existing claims can be enforced by proving that the claims were infringed prior to expiration. So, at the end of the day, assuming the surviving, original claims are infringed, NTP may be able to restart their stalled infringement campaign, against Apple, Yahoo, Sprint and others. (Virginia District Court stayed case pending USPTO reexamination)

While further appeals are also possible from the latest decision of the BPAI, it seems that NTP may have reached the point of diminishing returns and will instead allow the patent reexamination proceedings to finally end after 6+ years.

As injunctions in patent disputes have become more difficult to obtain since the earlier dispute with RIM, and the portfolio is expired/expiring, the previous leverage of NTP is significantly diminished.

Going forward, new NTP targets may find relief from a new provision of the America Invents Act (a.k.a recently enacted patent reform legislation, effective next September 16th) that will permit an inter partes style challenge (in this case Inter Partes Review) of these patents for the first time….the saga continues.

Prioritized Examination Program Expanded to Include RCE Filings

While not a typical post grant topic, prioritized examination (PE) is another feature of the recent America Invents Act that may be of interest to those with high value applications stalled at the USPTO.

As a reminder, PE under the AIA is essentially a codification of the USPTO’s track 1, Enhanced Examination Timing Control Procedures Initiative. Until passage of the AIA, and the increased funding that came along with the 15% surcharge, the Track 1 program was suspended. Thereafter, the Office began accepting requests for PE.

PE allows, as the name implies, examining certain applications out of turn based on a priority status and be disposed of within 12 months. That is to say, upon payment of a fee of $4800 for large entities, $2400 for qualifying micro entities, “priority” can be purchased. There is a cap of 10,000 such requests for any one fiscal year. Judging by initial filing rates (300 per month) that number is not likely to be exceeded.

Previously, applications undergoing prosecution, such as those at the RCE stage could not participate in this program….which makes sense in that there is no value in jumping to the head of line if already there. Why anyone would feel the need to pay such a hefty fee for a case already being examined is beyond me, yet the USPTO has provided for that eventuality in yesterday’s final rule publication in the Federal Register .

Of course, once an RCE is filed, the application no longer appears on the examiners special docket, and the application can slow as compared to past Office practices. Still, it is not clear to me if such a delay is worth the cost of PE. Nevertheless, the PTO is now expanding Track 1 to include RCE’s.

The Final Rule was published yesterday, in the Federal Register. (PE FAQ here)

An RCE application may be granted prioritized examination status if the following conditions are met:

1.  RCE filed in an original (non-reissue) utility or plant application filed under 25 USC 111(a) or entered into the national stage under 35 USC 371.

2.  The Request for Prioritized Examination is filed via EFS-Web (except in a plant application) before a post-RCE Office Action is issued.  The Request for Prioritized Examination may be filed concurrently with or subsequently to the filing of the RCE.

3.  Application must contain or be amended to contain no more than 4 independent claims and 30 total claims at the time the Request for Prioritized Examination is filed, and may not contain any multiple dependent claims.

4.  Request for Prioritized Examination must be accompanied by the Prioritized Examination fee ($4800/$2400), the processing fee ($130) and the publication fee ($300 – if not already paid).

5.  Only one Request for Prioritized Examination of an RCE can be filed in any given application.

Note:  RCE in a U.S. national stage application is eligible for this program, while such applications are not eligible for basic Track 1 Prioritized Examination, and Request for Prioritized Examination can be filed after an RCE has been filed (so long as no Office Action has issued since the RCE filing).