Inter Partes Re-exam Requests Continue To Rise, For Now

By Jason Rantanen

Some of the most touted changes of the America Invents Act are its modifications to ex parte and inter partes reexaminations, modifications that are intended to fine tune these post-grant review mechanisms.  Both ex parte and inter partes reexam requests have been on the rise for the past decade, as shown by the following two graphs:

Ex parte requests

Inter partes requests 2000-2011
Inter partes reexaminations, in particular, saw a dramatic increase in popularity over the last few years. 

The above data may paint an overly rosy picture of reexams, however.  Especially with respect to inter partes reexams, I am dubious that their rapid growth will continue.  One of the AIA's most significant changes to inter partes reexams (inter partes review starting on September 16, 2012) is to raise the standard for successfully initiating a reexam from "a substantial new question of patentability" to "a reasonable likelihood that the requester would prevail."  This change took effect when the AIA was enacted, and may lead to a decrease in the number of inter partes reexam requests filed – or at least, a slowing down of the rapid growth in this area. 

Inter partes reexam requests may also plateau for another reason.  The PTO reports that 70% of the patents involved in inter partes reexams are known to be in litigation.  If the initiation of re-exams is largely a function of litigation, there is a soft cap on the number of potential reexams that will be initiated.  In addition, AIA limitations on inter partes reexam requests involving patents that are the subject of infringement litigation, although easily avoided with foresight, may have a depressing impact on the number of requests filed.

Source data for reexams: http://www.uspto.gov/patents/stats/Reexamination_Information.jsp

The above graphs are corrected from an earlier version.  The original graphs treated the PTO's fiscal year as running from January to December.  It runs from October of the preceding year to September of the identified year.

21 thoughts on “Inter Partes Re-exam Requests Continue To Rise, For Now

  1. Thanks, now I finally understand your objection, which is apparently based on an assumption that PTO reexamination costs [even though only a miniscule part of the billion dollar PTO budget] are paid out of fees for other applications. That may be partially true, but your concerns will be alleviated when you see how much the PTO will charge anyone requesting the new Board-run inter partes reviews. Even now reexamination fees are very much higher than any normal application: $2,520 ex parte and $8,800 inter partes, just for the requests. Plus much higher legal fees than any normal application. So most of the cost is alrady being paid by those seriously concerned with litigation or other serious risks.

  2. Re: whether the new inter partes reexamination and coming inter partes review threshold or initition test of “a substantial new question of patentability” to “a reasonable likelihood that the requester would prevail” will decrease inter partes reexaminations.
    This new test was certainly intended by Congress to make inter partes reexam requests be more challenged by the PTO, which should carry some weight at the PTO. But I think it is too soon to tell before actual new PTO statistics on both the number of inter partes reexamination requests [petitions] and their PTO decisions, and whether it causes an increase in ex parte reexaminations requests since those still have the old SNQ standard. Having an inter partes reexam request unappealably rejected before even getting to a first base first action rejection adds to the already dangerous “might have raised” estoppel danger of inter partes reviews for defendants unless those defendants have other good defenses not based on any possible prior art patents or publications.

  3. It’s still a tail wagging the dog.

    There is no way around the fact that the percentage of live patents that see this type of “needed” treatement is less than 1/2 of 1%.

    Let me repeat that so we are clear here: less than 1/2 of 1%.

    You are creating a fixed sunk cost that the rest of the patent community has to pick up for those OH so very few patents that are actually litigated.

    Let those who choose to litigate pick up their own costs and stop shifting the cost to everyone else.

  4. A good question. I suppose you could simply add the 33% of ex parte reexaminations per year known to be in litigation to the 70% of inter partes reexaminations known to be in litigation, counted per year, and then divide by the number of patent suits per year times the average number of patents per patent suit, to get a good approximation?
    Someone who likes that kind of useful statistical analysis [hint-Dennis?] might want do that after the holidays?

  5. No, its more like spending a small amount of money extacting some dangerously bad dog teeth, rather than spending billions giving all of the half million patent applications a year a multi-billion dollar examination at a Hollywood Spa poodle treatment level that no one wants to pay for.
    In particular, per a recent W.C. patent seminar, 70% of all inter partes reexaminations are on patents in litigation, only 11% have all their contested claims re-affirmed. 44% have all claims cancelled and 45% have claims narrowed [causing intevening rights].

  6. Thanks Rantanen.

    So different reexam standards for each type?

    Wonder what effect/s, if any, this will have on litigation.

  7. That’s a bit like letting the tail wag the dog (given that less than 1% of actual active patents actually see litigation).

  8. Except no reexamination counsel from the big reexam firms actually seems to think the new standard will matter. Nobody ever filed a reexam anyway if the party didn’t think it had a reasonable likelihood of success.

  9. It is true from a PTO budget impact that the total number of reexaminations is a very small percentage of total patent applications. But these hundreds of reexaminations represent a significant percentage of the mere approximately 4% of patents that are actually agressively sasserted, patent litigation regularly costs millions of dollars each, and often issues of patent validity over previously uncited prior art never even get to trial in litigation, due to settlements to avoid such litigation costs and decisions on non-infringment. There is no practical or efficient way other than reexaminations to correct important patents erroniously issued because of the inherently very time and cost limited nature of PTO prior art searches. Hence, nuch of the new AIA patent law recently enacted is devoted to reexaminations.

  10. Is the scale correct? Are both of these items in the mere hundreds of instances?

    With the order of magnitude difference in actual issued patents and the even greater order of magnitude difference with the number of patents to be processed, it would seem that anything that is addressing a mere few hundred items makes for a rather thin topic.

  11. Thanks Rantanen.

    So does your “This particular change” regarding ex parte reeams refer to the new inter partes standard and/or to the change from “review” to “reexamination?”

    Thanks again.

  12. Doesn’t the high cost of inter partes reexam already limit filed reexams to those that the requesters think are likely to succeed? It seems to be self-regulating. What portion of inter partes reexams are unsuccessful (that is, conclude with little or no damage to the claims)? What problem do these amendments fix?

  13. Here’s what a prior post on Scott M’s expert “patents post-grant” blog had to say about that:
    “The new inter partes reexamination standard will be stricter, and is codified as: a reasonable likelihood that the requester would prevail with respect to at least 1 of the claims challenged in the request. Not only will this new standard will be applied to the new Inter Partes Review proceedings (available 1 year from enactment), but in the interim, to all inter partes patent reexamination filings. (See 6(c)(3)(C) of H.R. 1249; current Section 312 would apply between the date of enactment and the 1 year anniversary, at which time new Section 314 would go into effect with the same standard for Inter Partes Review.)”

  14. Any inter partes reexam requests filed on or after September 16, 2011, are evaluated based on the new standard. “Inter partes review” will replace “inter partes reexamination” on September 16, 2012.

    This particular change does not extend to ex parte reexam requests.

  15. I’ve inserted corrected graphs. The PTO’s data relate to fiscal years, which run October-September. As a result, the 1000 projected reexams for FY 2011 was incorrect. The FY 2011 number was actually 759.

  16. Dennis–I believe that the “inter partes review starting on September 16, 2012″ and “This change took effect when the AIA was enacted” statements leave it unclear whether inter partes reexams (exparte as well?) are actually subject to the new rules (including the raise in standard) for any reexam requests from now on.

    Could you kindly clarify?

    Thanks!

  17. Yes, and with inter partes reexaminations being conducted by the Board [not the CRU] starting in only about 10 months from now, they are likely to be more expensive and have additional requirements. Futhermore, the PTO is going to limit the number of them they will take. [This may encourage more use of ex parte reexaminations?] [Which is already suprisingly high if your projection of 1000 per FY is correct.]

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