Patentees Back Themselves Into a Corner at PTAB
Both patentees and challengers alike were displeased with inter partes patent reexamination prior to the America Invents Act (AIA). Inter partes patent reexamination was too slow to serve as a true alternative to litigation for patent challengers, and patentees argued the system was biased against them. In formulating the AIA Congress fashioned a replacement, Inter Partes Review (IPR). The IPR statutes, not surprisingly, mandate speed, and include mechanisms directed to the perceived lack of fairness of the old reexamination model.
Yet, even with the added IPR mechanisms, patentees are not faring much better as compared to the days of inter partes patent reexamination. As a result, patentees have lobbied for further changes. These changes, some of which are now proposed as formal rule changes by Patent Trial & Appeal Board (PTAB) may only make matters worse for some patentees.
Of course, if this patentee criticism were valid, far more trials would conclude favorably to patentees once such evidence is entered (it is permitted later, during trial). Nevertheless, responsive to this criticism, the PTAB now proposes to eliminate the prohibition against evidence in the preliminary response.
§ 42.107 Preliminary response to petition. (a) The patent owner may file a preliminary response to the petition. The response may set forth the reasons why no inter partes review should be instituted under 35 U.S.C. 314 and can include supporting evidence. The preliminary response is subject to the word count under § 42.24.
Given the lack of controversy over this proposal, it will almost certainly become a final rule in the months ahead. But, will it make a difference?
As alluded to above, if patentee evidence were as game-changing as urged, far more trials would conclude in favor of patentees once all evidence is considered. The statistics do not show a wide variation between institution rates and final cancellation rates. (Note: Some official statistics may be hard to follow in this regard since settled cases, requests for adverse judgment, and disclaimed claims are considered as findings of patentability)
Keep in mind that the vast majority (70-80%) of IPRs are in the predictable arts. Expert testimony, before an expert agency of engineers and scientists is nowhere near as critical as the same testimony in a district court. Remember that thousands of decisions come out of the ex parte appeal section of the Board every year with no testimonial evidence of any kind. Simply stated, the Board doesn’t need the technology explained to them. They are not, in most cases, picking a “winning expert.” Instead, more often than not, judges are deciding technical issues based on their own experience and training in the predictable arts.
In the unpredictable arts, different story. In those IPRs the new preliminary response option will have obvious benefits. While the Board is also technically skilled in the unpredictable arts, unpredictability lends itself more to outside guidance of experts in many niche technologies (Bio/Parma fields in particular).
But, what about the argument “ok, but it certainly can’t hurt to have a more robust option in the predictable arts to present your case prior to institution.”
As I have pointed out numerous times with regard to proposed PTAB changes, be careful what you wish for. . . .