Tweaks to Strict Motion Guidelines Are in Order

Since the passage of the America Invents Act (AIA) the Patent Trial & Appeal Board (PTAB) has successfully fulfilled it’s charge as a speedy, cost effective alternative to patent litigation. The PTAB has been so effective in cancelling patent claims, based on the limited, preliminary results, that the Board is being criticized as anti-patent. As discussed earlier this week, this criticism is unfounded as the USPTO will always be a significantly more patent challenger friendly forum relative to the district court. Still, there is another aspect of the early statistics that patentees find of equal concern, the perceived impossibility of successfully amending the claims of a patent during a PTAB challenge.

To date, the PTAB has not granted a single motion to amend.

The PTAB properly points out that that there is a very small sample of cases in which amendment has even been attempted, and a successful motion is expected to be issued shortly. Yet, the current statistical situation (as transient as it may be), coupled with the fact that the strict motion to amend guidelines have always been viewed unfavorably, is resulting in a bit of a black eye. This at a time when maintaining the BRI standard in PTAB proceedings is being justified based upon the ability to amend.

To the Board’s credit, the current round table initiative is designed to receive feedback for the purpose of revising some rules of practice. To this end, below are some changes that I believe would improve patentee prospects for amendment while maintaining the PTAB’s mission to expeditiously decide these important, but complex issues of patentability.

The guidelines for motions to amend are now well known. The single biggest complaint in satisfying the various burdens and requirements is the allotted page count. A typical patentee response in IPR  includes 60 pages for responding to the applied grounds, and an optional 15 pages for motions to amend. Both filings must be double spaced, 14 point font. The typical motion to amend is contingent, thus, 75 pages in total are submitted to the Board. Yet, it is very difficult to address all amendment burdens/issues in 15 pages of double spaced text; especially as the claim text itself also counts toward the 15 page limit.

While the simple remedy would be to increase page count for motions to amend, the Board also needs to be mindful of their 12 month statutory mandate for deciding the challenge. To balance the needs of patentees and the Board, there are a few, relatively simple fixes that come to mind.

– Allow claims to accompany the motion as an appendix (i.e., so that page count is not impacted)
This solution is straight forward enough. Given the 1-for-1 requirement for substituted vs. cancelled claims, not counting the pages of actual claim text toward the 15 page limit is unlikely to adversely impact PTAB scheduling/workload.

– Flexibly allocate additional pages where a show of attempted compliance is made
To date, the PTAB has been very strict with requests for additional pages, granting only 2-3 pages beyond the 15 page limit. (even in cases where the 60 page response was waived). This is another practice that can easily be changed without impacting trial schedules. A 5-10 page extension is reasonable in many instances. Of course, this relaxing of standards would burden the Board with additional requests for teleconferences. For this reason, the solution below seems to make the most sense from an agency perspective.

– Allow the patentee flexibility in page allocation across filings
As noted above, a typical contingent amendment filing includes 75 pages (60 response + 15 motion to amend). If a patentee were, for example, able to use 40 pages for the response and 35 pages for their amendment (75 total), the PTAB would likely see increased efficiency by way of fewer conference calls on the topic of page limits. To be sure, patentees will argue that the full 60 pages are needed for the patent owner response. Yet, in my experience, such is rarely the case where a serious attempt at amendment is pursued.

– Rescind/Modify Rule 42.73(d)(3)(i)
This “patentee estoppel” forecloses all patentably indistinct amendments before the USPTO once an adverse judgement is entered in a PTAB post grant patent challenge. Given the limited opportunity to amend before the PTAB, this rule is unbalanced. Perhaps a modification providing for a safe harbor to those patentees that choose not to amend before the PTAB would strike a fairer balance? Thereafter, a patentee could seek to remodel their claim structure via patent reissue, reexamination, or supplemental examination, free from estoppel concerns.

The PTAB plans to request formal feedback in July via federal Register Notice, be sure to get out to a round table in your area.

Critics Ignore Long Standing Realities

Critics of the Patent Trial & Appeal Board (PTAB) are out in force decrying the work of the PTAB as anti-patent. This criticism flows from the unfavorable outcomes of the 30 or so concluded Inter Partes Review (IPR) and Covered Business Method (CBM) proceedings to date. That is, some consider the heavy number of claim cancellation decisions as evidence of a bias against patentees. Nothing could be further from the truth.

First, patents now being asserted were drafted to survive district court scrutiny. As is well known, when in court, patentees benefit from a clear and convincing evidentiary standard, a presumption of patent validity, and a non-technical audience. Due to the significant obstacles of demonstrating invalidity before a court, infringement concerns have been the primary driver of patent procurement practices to date. For this reason patents are routinely procured to obtain the broadest possible claim scope for the purpose of ensnaring infringers; often times overly broad.

On the other hand, the PTAB counteracts each one of the district court invalidity benefits. The PTAB employs the more liberal preponderance of evidence standard for demonstrating unpatentability, no presumption of patent validity, and utilizes technical decision makers. An unpatentability finding of the PTAB is now a significant obstacle to patent monetization. Indeed, well over a decade of inter partes reexamination statistics demonstrate that 92% of the time patent claims are cancelled or amended in such administrative challenges. As can be appreciated, Patentees must recalibrate their prosecution and procurement practices to survive PTAB scrutiny.

Clearly such challenger friendly results are nothing new for the USPTO (or to anyone that has practiced before the PTAB). So, why are the more recent PTAB statistics causing such controversy?

Simple….SPEED

Inter partes reexamination proceedings simply could not conclude in time to matter for most patent disputes. That is, even if a patent ultimately fell in reexamination, the final result was 5-7 years away from the time of filing. That kind of delayed result disrupted very few patent assertion campaigns. For example, the NTP portfolio was ultimately gutted in patent reexamination, but that was years after RIM had paid the now infamous $612 million dollar settlement. Since passage of the America Invents Act (AIA), however, relief can be had within months with the right PTAB claim construction, and as little as 2 years otherwise.

Now, everyone is paying attention… and crying foul. Really?

Longest Running PTAB Only CLE Stops in San Francisco Next Monday

A day before the the PTAB round table event comes to Santa Clara on 4/29, the popular Practicing Law Institute program USPTO Post-Grant Patent Trials 2014 makes its yearly stop in San Francisco. This day long program, dedicated entirely to post grant patent practice was last held on March 27, 2014 in New York City where it set attendance records. This is the last stop of the year for this acclaimed program and faculty, a live webcast is also available.

The day-long schedule includes:

–The First Eighteen Months of Post-Grant Patent Challenges at the Patent Trial and Appeal Board (PTAB)

-The PTAB Petition, Pre-Trial Phase, and Trial Institution

–PTAB Trial Conclusion – The Oral Hearing, Final Written Decision, Rehearing and Appeals to the CAFC

-Covered Business Method (CBM) Challenges and Post-Grant Review (PGR)

–Optimal Strategy and Tactics in the Post-Grant Trial World, Including Parallel Litigation Proceedings

Copies of the best selling PLI treatise entitled Post-Grant Proceedings Before the Patent Trial and Appeal Board (Second Edition) are available (here). I hope to see you there.

Roundtable Discussions to Spur Dialogue on Possible Rule Changes

Roughly eighteen months have passed since the USPTO’s implementation of the new post grant patent challenges of the America Invents Act (AIA). Since the rules for implementing these post grant patent proceedings were developed under an aggressive time schedule, as promised, the USPTO is now revisiting those rules. In the months ahead, the USPTO will be considering whether revisions/refinements to the Patent Trial & Appeal Board’s (PTAB) rules are in order. To kickoff the effort, the PTAB will be conducting informational/roundtable discussions around the country. Once the roadshows are concluded, the USPTO is planning a Federal Register Notice this summer to collect additional stakeholder comments.

The roadshow agenda includes a discussion of AIA trial statistics, lessons learned, and techniques for successful motions practice.  The roundtables are free and open to all with seating available on a first-come, first-served basis. Stops include, Alexandria (webcast available), New York, Chicago, Detroit, Santa Clara, Seattle, Dallas, and Denver.

Schedule and agenda are posted below. Continue Reading PTAB Roadshow Effort Kicks Off in Alexandria on 4/15