PTAB Procedural Reform Initiative

VIA USPTO:

[T]he USPTO is launching an initiative to use nearly five years of historical data and user experiences to further shape and improve Patent Trial and Appeal Board (PTAB) trial proceedings, particularly inter partes review proceedings. The purpose of the initiative is to ensure that the proceedings are as effective and fair as possible within the USPTO’s congressional mandate to provide administrative review of the patentability of patent claims after they issue.

Since being created through the passage of the America Invents Act (AIA), PTAB proceedings have significantly changed the patent landscape by providing a faster, cost-efficient quality check on issued patents. . . .

This initiative will examine procedures including, but not limited to, procedures relating to multiple petitions, motions to amend, claim construction, and decisions to institute. It will evaluate the input already received from small and large businesses, startups and individual inventors, IP law associations, trade associations, and patent practitioners, and will seek to obtain more feedback regarding potential procedural enhancements.

Coke Morgan Stewart, Senior Advisor to the Director [and veteran patent litigator], will be coordinating this effort.

Members of the public may submit their ideas regarding PTAB procedural reform to: PTABProceduralReformInitiative@uspto.gov

About Dennis Crouch

Law Professor at the University of Missouri School of Law. Co-director of the Center for Intellectual Property and Entrepreneurship.

52 thoughts on “PTAB Procedural Reform Initiative

  1. Is this PTO solicitation for real?
    Why is there not even a date on the web page seeking comments at link to uspto.gov ?

    Here is a start. If this is a serious PTO effort at real potential regulatory change and not merely a ploy to deflect the mounting criticism of the IPR process by letting the public vet its frustration on the PTABProceduralReformInitiative@uspto.gov email address, then the Office must not act like a high-school blogger soliciting comments that appear to go into a black hole. Instead, the PTO should act professionally to use the standard administrative channel that reaches ALL stakeholders and show respect to those who would invest time in providing public comments. Accordingly, the Office should:
    (1) Use the formal administrative tool of publishing a Notice of Inquiry (NOI) in the Federal Register;
    (2) The PTO web page post states: “we have now compiled data derived from thousands of case filings and dispositions.” If so, then publish this compiled data in the NOI to facilitate informed public comments;
    (3) Demonstrate a commitment to create a public record of the comments received and promise to publish a PTO analysis of the public comments; and
    (4) Indicate in that analysis what issues the Office identified that may be subject to more specific NOI or otherwise to a proposed rulemaking.

    1. Ron, your point (2) is well taken. But as to (1) it has not been that unusual over the years for the PTO to announce a preliminary “trial balloon” request for suggestions before posting any formal Federal Register rulemaking proposals that one can hope might follow.
      Perhaps also the PTO has realized that these days a posting on this blog of an RFQ email address is far more widely read than the Federal Register?

      1. Paul,
        As to whether a blog post “is far more widely read than the Federal Register,” the PTO need not presume anything – it can do both: publish in the FR and post on a blog. Exploring regulatory actions by “trial balloons” that have selective reach is bad policy. My point is that because many serious stakeholders track government proposed actions by automated alerts of relevant FR publications and do not engage in casual surfing on blogs, the FR is the proper way to reach all interested parties.

        Moreover, using the FR early in the process for establishing a complete public record that may lead to changes in a regulatory framework is smart Administrative Law practice – it puts the agency on a stronger footing when seeking to comply with its obligation to publish in the FR under 5 U.S.C § 553(b).

        1. Let’s also note that blogs ARE selectively edited and cannot be viewed as providing any type of clear and objective viewpoints as to the item seeking review…

        2. As someone who has posted in the Federal Register before, I can tell you the process is ridiculously s-l-o-w and painful. Archaic doesn’t begin to describe it.

          If there’s any way to save yourself the hassle, you do so. Especially when, as another commenter mentioned, you get ten time the exposure posting to modern channels like blogs. FR is simply not worth it.

          1. FR Hater, do you have any evidence to substantiate your claim that “you get ten time the exposure posting to modern channels like blog”?

            If, as you say, you have posted in the FR, you must have worked for a government agency (PTO?). You understand, do you not, that the APA requires use of the FR? See 5 U.S.C § 553(b).

            1. Yes I have tons of data for my statement. It’s not shareable though – it’s just what I’ve found in my years of experience. I talk to people all the time about something in the FR and they say “Really, you’re doing that? I had no idea”. Whereas anything mentioned on patentlyo, people come up asking questions about it.

              The FR is required for certain types of communications but by no means all. 5 USC 553 only applies to rulemakings, which this does not appear to be at this stage. This looks more like information gathering in support of an existing program, which can be done without the FR per OMB guidance.

  2. The PTO is asking for submissions of realistic proposals for rulemaking or procedural PTAB changes for which the PTO has the statutory authority to make. Doing so might actually improve a few things. Does anyone have any? Filling up the “comments” section here [as in so many other blogs] with the usual Don Quixote tilting at statutes and Supreme Court decisions will not even get read.

    1. In the deciding whether to institute, the Director should presume the patent is valid, should identify at least a substantial new question of patentability, and should involve the examining Technology Center in the decision.

      At present the PTAB is abusing the discretion to institute in order to engorge their own docket, a blatant conflict of interest, and a fraud on the patent applicant/owner.

      Congress never said the PTO must review a single patent. Why do they second guess and overrule themselves more often than not?

    2. for which the PTO has the statutory authority to make.

      As much as you might not want to realize this, Paul, that might not be good enough.

      The question then might be better phrased: is there anything that the PTAB can do that falls under the statutory authority and yet saves that very same statutory authority from the (eventual) Constitutional infirmity that exists in what Congress did in the AIA?

    3. See, 2.1 and 2.1.1.1.

      Get rid of BRI.

      Provide that a randomly assigned senior examiner in the art unit of the patent handle the decision under 314(a). Institute on all challenged claims if any claim meets the threshold.

      Have the PTAB handle matters under 315 — with the latter decisions considered both final an immediately appealable by either party. Seek appropriate legislation if necessary.

      Mandate that the expert testimony be filed separately under seal and not be considered at the institution stage because it is untested by cross. Mandate that the petition itself not make reference to expert testimony. If trial is ordered, provide a briefing schedule for both parties after both side’s experts have been deposed.

      Mandate further that the expert himself testify under cross in a live hearing with the PTAB present before the testimony is accepted — essentially, copy the procedure of the ITC.

      Examine new claims only for support and that they narrow. Allow them automatically unless the petitioner opposes.

      Provide a final decision on all claims challenged in the petition.

      1. Interesting points Ned.

        But why the “Institute on all challenged claims if any claim meets the threshold.…?

        That seems counter intuitive here.

        As to your ideas concerning the institution decision point – you still seem to be fighting against the notion (well understood in property law) of sticks in the bundle of property rights – and exactly when a taking occurs.

        As to “Examine new claims only for support and that they narrow” – how is this not an examination per se and how do you not apply BRI to any examination? Allowing “automatically” then seems to beg the point as well – it seems that you do not want a “real” examination. But any time that you are going to put something out – that is different than what went in – you require an examination in order for the grant of patent to be made. In other words, there is no such thing as “automatic” allowance. Nor should there be.

        As to “ final decision on all claims challenged in the petition” I do see what you are getting at there: estoppel.

        1. Actually anon, the final point about a decision on all challenged claims goes back to the institution decision. Right now, the PTAB looks at every claim decides institute on some and not on others. If they have to make a final decision on all claims why are they doing that? All they have to do is institute on one, and the for a decision on any other claim to the final decision.

          But the PTAB should have nothing to do with the institution decision as others have so ably argued. A senior examiner in the relevant art should make a decision as to whether any claim meets the threshold. This way, the PTAB would look at the issues with fresh eyes.

          1. Another facet of the institution decision point…

            Still waiting for you though to grasp the most important (property related) aspect….

          2. The lack of “separation” between the political and the “judicial” in the particular executive agency known as the the Patent Office is well known (and commmented upon many times previously).

            Understanding some basic Admin law would be beneficial to understand what that means as to your desired “fix” (in other words, the problem is one related to the very structure of the USPTO and its legislated start – much deeper than having “a senior examiner” make the initiation decision.

      2. My comment still awaits “moderation”…

  3. The PTO and Congress should be looking at a way to put a hard limit on the amount of PTO resources and/or the amount of IP that a single controlling entity can consume/control. This can be done with a bright line rule or it can be done with a progressive fee schedule. But it should happen.

    Reminds me: are Lemelson’s submarine patents tanked yet?

    1. Oops, I meant Hyatt.

      LOL

      More coffee needed.

    2. It should happen….

      ?

      As if it were a “good thing” to limit innovation (or for that matter, property)….

      Please get into a profession in which you can believe in the work product produced, Malcolm – the cognitive dissonance is just not healthy for you.

      1. I’m not talking about limiting innovation. Nobody is.

        But you’re too dense to understand basic English. We all knew that already.

        1. But that is in effect WHAT you are talking about – you want to limit the rewards that should come hand in hand with innovation.

          Clearly I am not the one attempting to “play games” with the language here, Malcolm.

          Your feelings are your own – but please don’t dissemble when others accurately note what those feelings are.

    3. I don’t even understand why this would be an issue. You’re worried for some reason that some “controlling entity” is swamping the PTO?

  4. PTAB proceedings have significantly changed the patent landscape by providing a faster, cost-efficient quality check on issued patents. . . .

    PTAB has hardly changed the landscape at all for most of the grown-up practitioners. The same rules still apply. If anything, all PTAB has done is put the pre-existing landscape into sharper relief. If you want a strong patent, you start with a non-abstract invention, you hire a good lawyer, you acquire an understanding of the prior art, you do what’s necessary to shore up any enablement concerns, and you draft your claims and specification accordingly. Same old, same old.

    A genuine landscape change would be the expunging of logic patents from the system as that’s where 99.9% of the worst junk has always been and will always be. It’s also where99.9% of the worst practitioners end up feeding off the slimy bottom. Everybody knows this. Everybody has always known this.

    Unfortunately the CAFC has conspired with its favorite “stakeholders” once again to kneecap the most effective means Congress provided to the public for eliminating a large segment of “do it on a computer junk”: the so-called Covered Business Method program that permits eligibility challenges (unlike the vanilla IPR proceedings).

    Congress needs to fix that. Specifically, Congress needs to expand IPRs to include eligibility challenges. This is critical and it should happen soon.

    If the PTO really wanted to improve patent quality, it would first need to come up with a coherent system for examining logic patents that necessarily will include a formal claiming paradigm, a dedicated database for storing all the “new” logic in an organized searchable manner, and a systematic manner of applying the law to the formally claimed logic. I’m going to go way out on a limb (LOL) and humbly suggest that’s never, ever going to happen. And we all know why.

    Here’s the thing: every time you hear one of the patent maximalists who tr0ll here complain about “patent quality”, just rest assured that “patent quality” is the last thing they really want. Again: everybody knows this. What they really want is more patents, more quickly, that are easier to monetize. Once you understand this, their endlessly hypocritical mewling becomes a lot easier to digest.

    1. “logic patents”

      Once again Malcolm, how goes your attempt to obtain a copyright on “logic”…?

      Please stop your dissembling.

      1. Is there a less effective argumentative tactic than spouting some incoherent gibberish and then accusing someone of l y i n g?

        Only “anon” would know, having plumbed the depths countless times.

        1. Your reply is meaningless ad hominem.

          And yes, we both know that.

  5. So, so much spin and self-congratulatory narcissism in that notice it makes one both incensed and nauseous.

    1. Just a couple thoughts: in order to implement the congressional policy that IPRs be a low-cost alternative to validity litigation, provide that the director will dismiss any petition that does not waive the petitioner’s right to thereafter assert invalidity in court.

      Provide further that the director will dismiss any IPR where the petitioner has already asserted invalidity in court.

      Thus, the IPR would be available only to petitioner’s who do not assert invalidity in court.

      1. How about the low-cost part?

        AIPLA says $350K is the median IPR cost to a determination.

        1. Yeah, we need the petitioner to pay the attorneys fees of the patent owner to the extent that the patent owner has not filed an infringement claim or counterclaim.

          1. Ned so if the patent is found invalid, the patent owner can pay the entire cost of the proceedings for both sides? Maybe we do need the English system at the PTAB.

            1. Martin, you have everything backwards.

              The patent owner has not sued the petitioner for infringement. Yet the petitioner has attacked the patent owner in the patent office trying to strip the patent owner of his property. The petitioner has nothing at risk. The patent owner has to defend at great expense – merely because he applied for and obtained a patent.

              The usual justifications for both sides bearing their own costs and attorneys fees is that both sides have an interest in the outcome. Here, the only party at risk is the patent owner. He has to defend or else he loses and the expense is great.

              I can see absolutely no justification for such a procedure to exist at all, but if it must exist, it is only fair that the petitioner or absorb all costs imposed upon the patent owner, win lose or draw.

              The mere fact that the patent owner must defend without the petitioner having any risk at all, or the patent owner having any upside for victory, and he must defend a great expense, is an abomination.

              The time to act for a petitioner or somebody complaining about the issuance of a patent is before the patent issues. After the patent issues, no one should be able to challenge a patent in the patent office. The only place where a patent can and should be challenged for invalidity is where the opponent has downside risk in the patent owner has upside in order to justify the cost of the litigation.

              The architects of the IPR knew full well the disastrous effects the IPR system was going to have on patent owners and on United States patent system. They intend to virtually destroy it, and they have. Patents are now all but unaffordable to the impecunious, which provides a strong disincentive for anyone to invest in new ideas because they cannot protect them.

              1. This goes hand in hand with the “swagger” of Malcolm and his duplicitous desire to deny the form of innovation most accessible to those without a huge bankroll: software.

              2. Re; “The patent owner has not sued the [IPR] petitioner for infringement.”
                Ned, as you know perfectly well, having been reminded several times, that is simply not true for more than 80% of all IPRs. The PTO statistics on that are unchallenged. [Also, by far most of the other less than 20% of IPR petitions are by those who have been threatened or who’s customers or competitors have been threatened or already sued.]
                Thus, if the statute was changed to eliminate all IPRs in which the petitioner was not already sued by the patent owner it would have little effect on IPRs.

                1. Paul, again let me be clear, if a patent owner sues for infringement, he should understand that he will be IPRed. There will be no justification under the circumstances for having the petitioner pay the expenses and attorneys fees for the patent owner. That is why I make it as a condition that the patent owner not have sued or counterclaim for infringement.

                  We get into the details too. If the patent owner sues on patent A, and the petitioner IPRs not only patent A, but patents B-Z, the petitioner should be paying the expenses with respect to all of the patents IPRed but the patent in suit.

  6. Quality check after the fact (post grant) is NOT a quality check in any sense of the Demimg meaning.

    Anything that does not reflect back and actually improve the examination process the first time through is spin and should be highly suspect.

    1. “[A] quality check on issued patents . . . [BY INVALIDATING THEM]”

      To quote MM, LOLOLOL

    2. But isn’t the Examination/IPR scenario closer to your patent registration “idea.” All patents get the initial quality check through examination. Only the highly litigated patents get the additional quality check through the IPR. Maybe, after initial examination, we should call them “Patents*” and then after IPR they are called “Patents.”

      1. A lot of us already refer to granted patents that have never been challenged as “untested.” Same difference.

        The best patents — as always — are the patents where (1) the claims were drafted by someone who understood the prior art and the invention; (2) where there was a bona fide technical problem to be solved; and (3) there is data showing that the claimed invention works better.

        1. Malcolm,

          Except for the legal fact that a granted patent is property and carries with the presumption of validity.

          No small factors.

          OSitA,

          Further, there is a huge cost difference (to the tune of Billions annually between what we have now and registration.

          1. Are valid patents valuable? If so, the cost of obtaining such patents should reflect that value. If you are going to make $100 million off you patent rights, $50k is a drop in the bucket. If you aren’t going to derive enough value from your patent to defray those relatively low costs, then what is the point?

            1. If so, the cost of obtaining such patents should reflect that value.

              This is a logical fallacy, as the value simply cannot be known a priori.

              Further, the reward is not – and never has been – a guarantee of money. Rather, it has always been in the property aspect – and then it is turned over to the individual and to the open market to determine the value.

              Your understanding of how all of this works seems to be quite absent.

              1. This is inconsistent with your own prior admissions that the increasing common obtaining of patents written and prosecuted on a low bidder outsource basis [and without any pre-filing prior art search] leads to lower patent quality.

                1. Paul, I think the primary reason we have patents with low patent quality is that the patents at times do not have any claims of all the claim the invention. Rather the claims are focused on claiming results – you know, function at the point of novelty.

                  The case Dennis posted today regarding “batches” is a poster child for the problem.

                  It is not that the patent office is not examining properly for the prior art, is that the patent office has not been given been allowed to apply Halliburton for what ever reason.

          2. Being property and having a presumption of validity are independent concepts that are unrelated to patent quality. The presumption of validity increases the value of patents, but it doesn’t affect their property status. Similarly, property status does not require a presumption of validity. Even if a patent was presumed invalid, the right to obtain damages after proving validity would still have value. However, neither concept directly relates to patent quality. Presumably, higher quality patents will have more value than lower quality patents regardless of property status or presumptions.

            1. NS, I disagree for the reasons ably stated by Ron Katznelson.

              The heightened burden of proof exists to when both sides to not have the same value at stake. An infringement defendant only has the damages he caused the patent owner at stake. The patent however, is worth a lot more than that.

              Stripping the patent owner of the higher standard of proof perhaps is the most damaging aspect of reexaminations and other post-grant reviews.

              1. Those are economic arguments that need data support. E.g., you have not considered the several million dollar costs to defendants [not patent owners] to obtain a final decision of invalidity by the litigation route. Also, how is the patent “worth more” than recoverable infringement damages if an injunction cannot be obtained and it does not win on both infringement and unproven invalidity against a product similar to the products of other alleged infringers? Will the patent owner be able to sue again?
                To also answer Max’s question above, no, we have no formal “superpatents” system, but someone infringing a patent already held valid and infringed by a similar product is at risk for a preliminary injunction, enhanced [up to trebled] damages, and attorney fees for a frivolous defense if they do not have a good new defense.

                1. Paul, and less the defendant in the particular case is a monopoly, the likelihood that there be more than one infringer of a patent is high. Thus while the infringer has at stake his damages, the patent owner has at stake not only the damages from this infringer but the damages from all infringers. Thus the patent is worth a lot more than the damages of a particular infringer, in most cases.

            2. Do the job right the first time through.

              ALL boats will rise with that tide.

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