Misguided STRONG Act Would Undo Years of AIA Progress
Well, if you expected the Goodlatte Bill to sail through the House for swift passage through the Senate, forget about it. Hill chatter has indicated that the significant House support of the Bill has diminished since the last vote in 2013 (and rightfully so given the events of the past year). Perhaps of greater threat to the patent reform effort , however, is yesterday’s introduction of the “STRONG Act” on the Senate side (here), which makes clear that further patent reform is far from guaranteed for 2015.
The STRONG Act, or “Support Technology and Research for Our Nation’s Growth Patents Act of 2015” removes the controversial fee shifting provision of the Goodlatte Bill (a key point of contention in past battles). More importantly, the Senate Bill adds a multitude of proposed changes to AIA trial proceedings that will have patent abusers dancing in the streets —the Bill is more aptly titled the “Support Trolls & Reverse Our Nation’s Progress under the AIA Act of 2015.”
While this legislative grenade may not have much chance ever seeing the light of day, it is surprising that such misguided proposals would be seriously offered in the first instance.
Let’s go through some of the low-lights:
The STRONG Act attempts to tackle the difficulty in amending in AIA trial proceedings. (an effort already well underway at the PTAB). The bill seemingly proposes that the first amendment (if a reasonable number of claims) be granted as a matter of right. The Bill doesn’t specify who would be responsible for examining these amended claims, the very reason why the current amendment practice is by motion (i.e., burden is on movant to demonstrate patentability to an adjudicatory body).
Next, we get to the really fun stuff. The Bill proposes that a Philips claim construction be applied in AIA trials along with a presumption of validity to issued claims, and a clear and convincing evidentiary standard for unpatentability. (for newly added claims existing standards would apply). That is, the PTAB will be applying two separate standards of patentability at the same time. Yes, you heard me right. Philips construction, presumption of validity, clear and convincing evidence. Sound familiar?
So, basically, every reason patent challengers currently utilize the PTAB would be taken away to align with district court practices. Sound good perennial patent troll targets?…but wait, there’s more.
Preliminary responses are proposed to include evidence, and if so, the petitioner can respond with a Reply. Dont’ worry PTAB—sure its double, if not triple the work, and you will have about a month left to read the entire record and issue a decision…details details. Oh, and the PTAB panel that issues the institution determination, forget about everything once the ink dries because a brand new panel has to conduct the actual trial. Administrative efficiency abounds!
Lastly, and this is my favorite, if a reissue or reexamination is pending (where none of the heightened standards above would apply), there can be no IPR/PGR. So, if you are a patent troll, you simply file a Tanaka reissue before every licensing campaign. For the cost of a few thousand dollars a year you can effectively keep your patent out of the PTAB. What’s not to like about that type of legislative forethought?
There are other AIA related proposals in the Bill, such as limiting all AIA trials to those sued or charged with infringement, and adding a 1 year window to reexam filings for requsters served with a complaint for infringement…. basically the entire patent troll wish-list. These proposals would eviscerate 2+ years of progress under the AIA. Patent challengers would be forced back to the friendlier standards of the reexamination system, an ex parte one at that. Yet, the AIA trial proceedings were designed to replace slow and unpredictable reexamination proceedings. AIA trials have been wildly successful in reducing the costs of litigation and eliminating problem patents.
The problem for patentees isn’t the PTAB, it’s the outdated practices of patentees that are broadly drafting patents without a care for validity. This is because surviving district court scrutiny is not a pressing concern given the protective standards applied. Bringing that deferential analysis to an expert agency, where amendment is encouraged for reasons of public policy, is nonsensical and would greatly fuel abusive litigation.
There is much wrong with the over-reaching of the Goodlatte Bill. But, if the Senate is trying to prove that it can come up with the most ill conceived ideas….game, set and match!
This mess will continue for the rest of 2015.