Six-weeks into the new inter partes review regime, third parties have filed a total of 41 inter partes review requests – each one challenging a single patent. Of these, I identified 34 (82%) as already being involved with prior litigation in court. Most of the prior-litigation is patent infringement litigation. However one case (involving Sony & Tessera) stems from a licensing dispute between the companies. Of the seven patents that have not been subject to prior litigation, five appear to be part of a retaliation game between Intellectual Ventures and Xilinx. IntVen challenged four Xilinx patents in an apparent retaliation against a prior declaratory judgment filed by Xilinx. Not to be outdone, Xilinx then filed its on IPR against an IntVen patent. In a sense, IntVen’s actions may serve as a warning against other potential licensees who refuse to deal. The final two non-litigation IPRs appear to be focal points of disputes between fairly small competitors.
The point of all this is fairly obvious – that inter partes reviews are being used only when there is a major dispute between the patentee and the third-party filer. The filings used in parallel to district court and ITC litigation were entirely expected. It was not so apparent that inter partes review would be used as a pawn in a larger battle between companies. The small number of filings helps to confirm the strong prediction that inter partes reviews will not be used as a tool to limit the number of “bad” patents.
In these cases, the patent owner has three months to file a preliminary response (or waive that filing). Following that, the USPTO has three months to determine whether or not to grant the inter partes review request. At that point, the statute calls for a final determination from the PTO within 12 months.
As a strategy, Xilinx should challenge whether IV’s members should be considered a real party in interest for the IV IPR filings… Has anyone heard of whether Xilinx would consider this?
FYI, Xilinx only has two i’s.
Paul, and to the extent is become clogged, it will be avoided.
I know patent firms take both sides, but hourly billing on lawsuits is extremely profitable. Litigators have no real incentive to get out quick. It is up to inside counsel to control matters, but most do not have the b*lls.
Josh Marshall (from below): 101 is not an invalidity basis in IPR, but that doesn’t mean petitioners won’t find creative ways to try. Check the petition in IPR2012-0022 for an example of this.
I will! Thanks.
You can’t raise 101 in IPR — that’s limited to post grant review, which has to be filed within 9 months of the grant
What if the 101 issue doesn’t become clear until the relationship of the invention to the prior art is established/admitted? i.e., what happens if the only difference between the prior art and the claims is the recitation of non-integrated ineligible subject matter, as in Prometheus? The USPTO has to allow the claims, even though it’s clear they are not eligible? Or can the USPTO sua sponte raise the issue when it’s handed to them on a platter during inter partes re-exam?
From what I’ve seen, no one is interested in putting money into getting rid of “bad” patents unless the patent is asserted against them.
Not a suprize really.
In other words, do you have a point, or do I just have another personal troll that feels the need to be contrary without substance?
What did I say that was contrary? I simply proposed an answer to your question. I don’t see any need for the gratuitous insult. I thought you wanted to clean this place up?
My point is simply that the fees on the backlogged appeals have already been paid. To suggest that the PTO needs to increase fees to pay to do work that is already committed to and is already in the pipeline seems to go beyond any reasonable notion of cost-based fees.
I would say that it is a fair guess that the backlog of appeals was not tied to any cost recovery budget process in the past, but that the newly granted powers of setting fees may directly affect those fees going forward.
In other words, do you have a point, or do I just have another personal troll that feels the need to be contrary without substance?
That leads to the obvious question of covering cost for those switched resources – will Appeal costs be jacked up?
Given that the fees have already been paid on all those ex parte appeals and given that it doesn’t cost very much to let an appeal sit in backlog, one would hope not. If the PTO set the pricing for appeals based on a cost recovery model that assumed that the appeals would not actually be considered, then they didn’t do it right.
Ned, most firms handling patent litigation [unlike many other torts] will handle both patent offense [patent owner] and patent defense work. Also, most large companies both assert patents and defend against patents. Ulterior, subconcious, or other motives by firms or clients opposing the various PTO post-grant proceedings now available were certainly not limited to some law firm defense counsels.
[P.S. ED TX is not all that fast any more either.]
Agreed that there are too many variables for a long range projection of IPR usage at this point. For example, maybe some parties were waiting to file IPR’s to hopefully get a much faster and APJ-Board-run proceeding, and/or some IPR discovery? Causing an IPR intial-filing “bubble”? Even though IPR’s are much more expensive than the now extinct inter partes reexaminations, from another perspective their PTO fees are still less than just a few days of patent litigation team billings.
Furthermore, the IPR statue provides that “An inter partes review may not be instituted if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent.” This new time limit lights a fire under defendants who had been able to procrastinate over an inter partes reexamination decision.
Anon and MM: 101 is not an invalidity basis in IPR, but that doesn’t mean petitioners won’t find creative ways to try. Check the petition in IPR2012-0022 for an example of this.
Dennis, your conclusions seem to be unchallengable.
My thoughts: The expertise of the PTO in getting it right might be attractive, but the speed of the proceeding is the barrier. Defendants, despite their protests to the contrary, generally want to delay and to drive up costs to the plaintiff. Defendant counsel also want to maximize, rather than minimize, their own billings.
Speed, not expertise or the lack of it, is is why defense firms so abhor and ridicule fora such as the ED of Texas. Ditto the new PTO proceedings.
Thanks Paul, good comment on the switching of the resources.
That leads to the obvious question of covering cost for those switched resources – will Appeal costs be jacked up?
No, the additional Board APJ’s hired to do IPR’s can work on the Board backlog of normal ex parte appeals, as was done with the reduction in APJ’s needed to work on interferences.
? Yes, the majority of patents sued on have not been subjected to reexaminations, and patents based on applications filed before 1999 were not even subject to inter partes reexaminations. But something like 68% of inter partes reexaminations reportedly had related litigation. The subtantial percentage of reexamined patents[especially in inter partes reexaminations]that end up rendering unpatentable at least one contested claim certainly does NOT suggest that a “review by the patent office is nearly meaningless.”
Yes, there have been some relatively meaningless reexaminations. Namely, those that the PTO has allowed to drag on so long, including CRU to Board appeals, that they took longer than the related litigation, and all the litigation defendants already had to settle or pay final judgments before the reexamination finally ended. But that time delay is what the new specific time deadline and the new directly Board-run IPR trial system is supposed to cure.
Dennis – It would be extremely useful if you could look into how many court cases involving patents(outside of Hatch-Waxman cases wherein reexam makes little sense) do NOT ultimately end up in reexamination. This would give us a significant understanding of whether patents going into reexam are truly the so-called BAD ones or whether given the standard of KSR one can nearly always get a reexam – suggesting that maybe a review by the patent office is nearly meaningless.
Still to early to make any sweeping characterizations about the use of IPRs. We will need to wait another 6 to 9 months (at least) to really determine how IPRs are likely to be used. Anyone even thinking about filing an inter-partes-type review as of early September probably rushed a filing in under the old (cheaper) rules. I know we filed a much larger than normal number of Inter Partes Reexams just before the switch over to IPR.
Accordingly, while I agree that IPRs are more likely to be associated with major disputes, I also think we are still experiencing the hang-over from the switch.
You can’t raise 101 in IPR — that’s limited to post grant review, which has to be filed within 9 months of the grant.
But the expensive price tag was premised on a certain volume.
If that volume is vastly undershot, does this portend to even greater fees in the next cycle to hit the budgeted dollar value?
I had supposed that the 12 month deadline would be impossible to meet. But I suppose that, at this rate of arrival of new cases, there wil not be any problem at all.
IntVen challenged four Xilinix patents in an apparent retaliation against a prior declaratory judgment filed by Xilinix. Not to be outdone, Xilinix then filed its on IPR against an IntVen patent. In a sense,
Anyone know what the technology is about here? Is either party making any interesting/forceful arguments under 101?
Comments are closed.