Oil States Briefing: Linking AIA Trials to Reexaminations

Amici briefs supporting AIA Trials and Inter Partes Review are beginning to be filed.   The first brief in is filed by John Vandenberg’s team at Klarquist representing SAP, Gilead, Nautilus, and others.  The Brief presents a reexamination linkage and slippery-slope argument in two forms: (1) killing inter partes review will also kill reexaminations; and (2) pre-AIA patentees ‘consented’ to reexamination and that should be seen as consent to inter partes review.

Vandenberg writes:

Since 1980, the Patent Office has issued more than 10,000 reexamination certificates canceling, amending, adding, or confirming claims of issued patents. Inter partes review is substantively identical to reexamination, enforcing the same patentability conditions and issuing the same certificates canceling, amending, adding or confirming claims. Like reexamination, inter partes review is a rational condition the Legislature has imposed to maintain a patent, pursuant to its Constitutional authority to grant patents “for limited Times” to promote the useful Arts.

Since 1980, every patent applicant has consented to the substance of this reexamination as a maintenance condition for each granted patent. . . . Petitioner obtained its patent before 2011. But, like every other patent applicant since December 12, 1980, Petitioner consented to reexamination as a condition for maintaining its patent. Petitioner knew that the patent it sought would be subject to a reexamination request by anyone in the world at any time, including the Commissioner (now Director) of Patents, potentially leading to early cancellation of the patent. And, as noted, the substance of that reexamination to which it consented, is identical to inter partes review.

[16-712 bsac SAP America, Inc., et al.]

I am sympathetic to the arguments here – especially if narrowed to focus solely on inter partes reexamination.  A key caveat though is that the Supreme Court has never ruled that inter partes reexaminations are a proper exercise of administrative power.

136 thoughts on “Oil States Briefing: Linking AIA Trials to Reexaminations

  1. I just read General Electric’s brief. Essentially it is said that the “PTO” has been in the adjudication business regarding interferences since 1793, that included patents from 1836, that included reissues, and later included reexaminations from 1980 – and that IPR are more of the same.

    However, the 1793 Act only allowed interfering applications to be arbitrated, the 1836 Act specifically allowed a bill in equity to challenge the determination of the PTO, ditto reexaminations until the AIA. Thus patent owners always had a right to their day in court with respect to interferences or reexaminations until the AIA.

    But another point I do agree with. Once you concede that reexaminations are constitutional, you also necessarily concede that IPR are constitutional. GE makes that point abundantly clear.

  2. Below, Ron Katznelson notes:

    The asymmetry arises immediately upon the grant of the exclusive patent right in exchange for disclosure and is irreversible thereafter because the patentee’s loss and the dedication of his invention to the public is irreversible.

    Inherent in this concept is the fundamental notion under girding ALL patent law: the Quid Pro Quo.

    Now, some might venture back with a counter point of “well, if you did not deserve a patent in the first place, then there is no harm done.”

    Such a statement misses the mark -and misses by miles.

    Whether or not a patent is “rightly granted” rests in the very presumption. One cannot logically put the cart before the horse, dismiss the presumption as if it did not exist at all (and note to particular regulars, when I say “presumption,” I clearly mean BOTH its presence AND its level), and then “justify” the Ends reached of “it was not proper.”

    ONLY after the proper Means are walked through – including the means recognizing both the presence AND the level of the presumption – can any Ends that may be reached be said to be just.

    The act of the grant itself confers the bundle of property rights.

    The act of the grant itself turns the inventor’s inchoate (I dare say natural) right into a full legal property right.

    The act of the grant itself provides ALL other Constitutional protections that inure to property.

    Some (and the regulars here know exactly which sAme ones those “some” are) want a different set of laws, a different Constitution, and a different “philosophy” towards property to replace the bedrock principles of the US Sovereign patent law principles – which patent principles remain tied to property principles.

    THIS is – and must be – one of the KEY drivers kept in mind for the Oil States case.

    I dare say that every machination, every other philosophy that seeks to weaken patent rights falls when the proper view of the Quid Pro Quo is kept front and center.

    1. ONLY after the proper Means are walked through – including the means recognizing both the presence AND the level of the presumption – can any Ends that may be reached be said to be just.

      So one can only know that c-&-c is the correct standard by assuming as much at the front end of the analysis? That is known as the logical fallacy of assuming the consequent.

      Dr Katznelson made a very good point. You are doing him no favors by trying to help.

      1. You are not paying attention – there is NO “assuming.”

        This is simply the basic understanding of the US patent system and what the Quid Pro Quo means.

        As for “doing him no favors,” your bias is showing – nothing more.

    2. Re: “The fundamental notion under girding ALL patent law: the Quid Pro Quo.”
      Regardless, that is not going to be a basis on which Oil States will be decided. Because it is not a Constitutional requirement, or even an absolute requirement in U.S. patent law. Millions of U.S. patents have validly issued in which the invention was fully publicly disclosed within the grace period prior to filing a patent application, or publicly disclosed while the application was still pending even though no patent issued. Even under the AIA there remains a pre-filing grace period for the inventors. 18 month pre-issue application publication can only be avoided by giving up foriegn equivalent application filing.

      1. Paul, the disclosure of an invention to the public in exchange for patent gives the patentee a vested right in the patent that is his property. Thus it does create a constitutionally protected property interest in the patent. The central argument of the government is that the patentee has no property interest in the patent whatsoever. Therefore this issue is central to this case.

      2. Paul,
        The fact that “the invention was fully publicly disclosed within the grace period prior to filing a patent application, or publicly disclosed while the application was still pending” merely means that it was the free choice of the inventor to disclose prior to issuance of a patent. It does not mean that the patent bargain is not a legal requirement. And you are wrong because the disclosure in exchange for exclusive right “is an absolute requirement in U.S. patent law” and no patent applicant can be compelled to disclose before the patent issues. See 35 U.S.C. 122(b)(2)(B).

        Do you remember your colleagues pushing in 1997 for mandatory 18 month publication in HR 400? How did that end? We are in America – not in Europe, which has long perilously deviated from the patent bargain. In America, we still have a system where one can get a patent in exchange for disclosure. In the ROW, one can only get an option for a patent in exchange for disclosure – an option which may not always vest.

        1. It is NOT a coincidence that MANY of those seeking international “HARMonization” are those that see disruptive innovation as a business problem to be quashed at any cost.

          The Efficient Infringers Handbook clearly needs patent to be NOT property – and to NOT have protections of property. Rather, such “should” be viewed as things of “optionality” and de minimus harm if infringed (thus, the tie to other Big Business concepts such as “efficient breach”).

  3. The Supreme Court Tackles Patent Reform, by Richard A Epstein, a preeminent legal scholar and professor of law, writes that IPRs are unconstitutional. link to fedsoc.org

    Before he moves on to IPR, he writes,

    “The contrast between the 1952 Act and the AIA could not be starker. The 1952 Act was drafted by an eminent committee of two patent experts: Giles Rich, who later went on to serve 43 years as a patent appeals judge, and Pasquale Joseph Federico, who served as a high ranking official in the PTO. It was passed by voice vote. The 1952 Act is less than half the length of the AIA, but it is more than twice as good. The AIA is cluttered with arcane refinements and complex procedures, and it violates the fundamental maxim of legislative reform: if it ain’t broke, don’t fix it. ”

    Breathtaking, and so true.

    1. Breathtaking, and so true.

      Oh, how I wish that you would take your anti-Rich blinders off Ned.

      (by the way – thanks for the link, an interesting read, especially deep into the article, the following pops up:

      The Supreme Court unanimously rejected a broad reading of the public rights exception in the trademark context in its 2017 decision in Matal v. Tam.

      Most definitely not the centerpiece of the article, but the two paragraphs point out several points already on the discussion tables of this blog (discussion points that – as so often happens – repeatedly go ignored by those with limited scripts constrained to cheerleading for an AIA mechanism that is at base critically flawed).

      1. The Supreme Court unanimously rejected a broad reading of the public rights exception in the trademark context in its 2017 decision in Matal v. Tam.

        I think that this is basically correct, but the problem with this observation—if it is intended as the basis for a prediction about what the Court will do in this case—is that there is no neatly discernible pattern in the Court’s public rights jurisprudence. Basically, “public rights” is an ad hoc label that the Court has contrived so that it can allow some things to be adjudicated outside the Art. III framework, while retaining others strictly within the Art. III framework, without quite admitting the arbitrary nature of the distinction between what is in and what is out.

        The label made sense when it was first contrived by Chief Justice Marshall, but it has since lost any coherent boundaries. I expect the Court to reverse the CAFC’s Oil States Rule 36, but that expectation is grounded merely in the statistical observation that the Court rarely affirms the CAFC. I think that it is a fool’s errand to establish a prediction on the basis of the Court’s previous approaches to “public rights,” because that jurisprudence is simply an incoherent mess that could made to support any outcome in this case with equal plausibility.

        1. because that jurisprudence is simply an incoherent mess that could made to support any outcome in this case with equal plausibility.

          Not the first time that the Supreme Court has done this with patent law.

          1. Exactly. Nor will it be the last time, unless and until Congress simply takes patent law away from the SCotUS (I realize, however, in saying this to you, I am merely preaching to the choir).

    2. One issue I recently heard John Duffy well-known yapper on patents talk about was the “new reference” issue. Duffy misrepresents this issue. Duffy has created a mythical “new reference” that is relevant to patentability of a patent. But, this is a myth. The reality is that an expert in the field is expected to know the references and cannot possible list all the references. So, there is a presumption that the expert has selected the most relevant references.

      Anyone can find a reference not listed on the patent and claim that it is a “new reference” that is relevant to patentability. So, the myth centers on some image in one’s head of a person suddenly unearthing “new reference.” The reality is that the expert has already considered this “new reference” and determined it was not as relevant as the references selected to examine the patent.

      My bet is that Duffy is getting some of that Google money to put out this argument. Duffy is using this argument to challenge the presumption of validity. As in, well, the presumption of validity shouldn’t hold when there is a “new reference.” But, there are no “new references.” There are only references not selected by the expert as relevant as other references.

      But, then Duffy has no real experience with patents. He write appellant briefs and academic articles and manages to cause a bit of mischief now and then, but nothing more.

      1. Hmmm,

        Not sure I agree with your reasoning. Reality IS that examination does NOT take into account every possible reference.

        That is simply a truism.

        That part of your comment is a bit weak.

        That being said, the rest of your comment is a bullseye: the aim here is to attack the level of the presumption of validity that is a stick in the bundle of property rights of a granted patent.

        AND part of that provision is a dependence on the initial examination to have been made “by a professional” who it is to be taken as having commanded the best prior art to be used in the examination. ++++

        Duffy is not the first to attempt this attack. His company includes certain Supreme Court Justices (notwithstanding the i4i case).

        As Ron Katznelson put it so powerfully (on that other blog)***, a grant of a patent is KNOWN to be made with an imperfect record. Nonetheless, Congress still set the level of presumption to be at the Clear and Convincing level – and this very much has to do with the property aspect (think of quiet title, and the necessity of being able to “trust” that you actually have a property at the time of grant).

        Of course, this feeds right back into the current IPR regime mess – and the point that some IPR apologists simply seem unable to grasp: a later action by Congress (i.e., “tacking on”) may not violate protections already inured to that which is being tacked-on TO.

        *** See: post 20 at link to ipwatchdog.com

        ++++ IF one is to want to attack examination qua examination as NEVER being able to guarantee that ALL prior art has been contemplated, one might as well simply remove examination in its entirety. WHY bother with examination at all, if there will be NO such “quiet title” that attaches to that process? What do innovators actually obtain if the examination is merely a “one-way” keep out, and in practice, “examination” NEVER ends?

        Such a system violates the edict of the grant of power to Congress: such a system does not – and cannot “secure” anything. And to be clear – this lack of security applies to ALL patents, so the counter of “well, you really did not deserve a patent on that” falls far short of being any type of persuasive point.

      2. Please Pardon the Potential (re) Post:

        Hmmm,

        Not sure I agree with your reasoning. Reality IS that examination does NOT take into account every possible reference.

        That is simply a truism.

        That part of your comment is a bit weak.

        That being said, the rest of your comment is a bullseye: the aim here is to attack the level of the presumption of validity that is a stick in the bundle of property rights of a granted patent.

        AND part of that provision is a dependence on the initial examination to have been made “by a professional” who it is to be taken as having commanded the best prior art to be used in the examination. ++++

        Duffy is not the first to attempt this attack. His company includes certain Supreme Court Justices (notwithstanding the i4i case).

        As Ron Katznelson put it so powerfully (on that other blog)***, a grant of a patent is KNOWN to be made with an imperfect record. Nonetheless, Congress still set the level of presumption to be at the Clear and Convincing level – and this very much has to do with the property aspect (think of quiet title, and the necessity of being able to “trust” that you actually have a property at the time of grant).

        Of course, this feeds right back into the current IPR regime mess – and the point that some IPR apologists simply seem unable to grasp: a later action by Congress (i.e., “tacking on”) may not violate protections already inured to that which is being tacked-on TO.

        *** See: post 20 at link to ipwatchdog.com

        ++++ IF one is to want to attack examination qua examination as NEVER being able to guarantee that ALL prior art has been contemplated, one might as well simply remove examination in its entirety. WHY bother with examination at all, if there will be NO such “quiet title” that attaches to that process? What do innovators actually obtain if the examination is merely a “one-way” keep out, and in practice, “examination” NEVER ends?

        Such a system violates the edict of the grant of power to Congress: such a system does not – and cannot “secure” anything. And to be clear – this lack of security applies to ALL patents, so the counter of “well, you really did not deserve a patent on that” falls far short of being any type of persuasive point.

        1. OK, anon, those are good points.

          But, consider this. How does one tell when a reference is a “new referenced”? I argue that it is not possible except perhaps in extraordinary circumstances.

          Duffy is trying to argue that just because a reference not cited in the prosecution record is used in an invalidity argument that the presumption of validity should be suspended.

          So, I don’t think my argument is weak at all. It is going to the heart of what it means for an expert to examine a patent in the real world of tens of thousands of references potentially being relevant.

          1. As I mentioned, Night Writer, your second point hits the bullseye and it really is asinine to think that a reference, merely not being one “recorded” as viewed during the examination, should remove that stick in the bundle of property rights that is a granted patent.

            After all – that is exactly what Microsoft wanted to do to i4im and the the Court did not buy what Microsoft was selling.

            I just think that the better path is more along the fact as put so powerfully by Ron Katznelson.

            As they say, the best L I E S have a kernel of truth, and that kernel is that NOT every last reference in the world is viewed under examination.

        2. Congress still set the level of presumption to be at the Clear and Convincing level…

          Not to put too fine a point on it, but this assertion is not true. There are only two places in Title 35 where Congress sets an evidentiary standard: in §273, where Congress specifies clear-&-convincing for the prior-use defense against infringement (a point which does not actually touch on validity); and in §316(e), where the Congress specifies preponderance-of-evidence for invalidity in IPRs.

          In other words, the only time that Congress sets an evidentiary standard for invalidity, it specifies preponderance-of-evidence, not clear-&-convincing. It was the Court that introduced the c-&-c standard, untethered to any actual statutory text.

          1. Not to put too fine a point on it, but this assertion is not true.

            It is absolutely true.

            Maybe you want to try reading the i4i case….

            Your tortured searchings for some backing to your previously errant views on presumptions – and the levels of those presumptions – really takes you into the weeds here Greg.

            1. Maybe you want to try reading the i4i case…

              Fair enough. You are certainly correct that i4i held that Congress set the evidentiary standard at c-&-c. Neither of us tends to be overawed by the pretense that, if the SCotUS says X, then X must be true. Given that anyone who cares to can read the statute and see that Congress did not specify a c-&-c standard, I am a touch bemused to see you piously quoting the SCotUS in this uniquely convenient instance.

              1. It is rather humorous – although here I am also disagreeing with your view of what Congress had to say on the matter (piety not stemming from just the Supremes).

                This too may be traced to your past troubles with the concept – as you have not readily grasped the concept in play is more than just “presumption,” but also touches on the level of that presumption.

                Your views have just been too crabbed (and myopic as far as what “presumption” alone means).

              2. A fact that many law professors are ignorant of is that a standard of proof determine the level of certainty a fact-finder must have in deciding something is true, set onlyto allocate the risk of errors in adjudications among the litigants. The presumption of validity under the clear-and-convincing-evidence standard in patent law is not merely due to Congress’ implicit codification. As I have explained in my Amicus Brief in i4i (see link to j.mp), it is based on a fundamental principles of due process in a world where fact-finders commit adjudication errors.

                The heightened standard was used even before the Office started examining applications in 1836. See my i4i Brief, at 30-32, (quoting passages from Sen. Rep. Accompanying Senate Bill No. 239, 24th Cong., 1st Sess. (April 28, 1836), as endorsing the heightened standard of proof and the presumption of patent validity). Rather, the presumption of validity under the clear-and-convincing-evidence standard is an immutable adjudicatory standard matched to the large asymmetry in the countervailing risks to the litigants due to fact-finder errors in validity determinations.

                In a patent infringement action, the litigants’ risks of fact-finding errors in determining infringement are symmetric, because each party has the same dollars at risk—the damages judgment amount in the event of a finding for their adversary. There is no reason to favor one litigant over the other and proof is based on 50:50 probability. Therefore, this essential symmetry of risks has long been recognized as requiring that infringement be proven by preponderance-of-the-evidence. Bene v. Jeantet, 129 U.S. 683, 688 (1889).

                That, however, is not the case for patent invalidity determinations. When the fact-finder erroneously upholds an invalid patent, the defendant risks the unjust loss of damage award only for his own activity, whereas when the fact-finder erroneously finds a valid patent invalid, the patentee risks the unjust loss of his rights to damage awards from hundreds or thousands of infringers or licensees, and the unjust enrichment of the public with a disclosure of the invention that was published upon consummation of the patent bargain. The asymmetry arises immediately upon the grant of the exclusive patent right in exchange for disclosure and is irreversible thereafter because the patentee’s loss and the dedication of his invention to the public is irreversible.

                The concept of a “flexible” standard based on whether the PTO considered a reference or made an error is nonsensical – there is no “do over” in the patent bargain. If the PTO did not consider a reference, it may add to the weight of the evidence so that the standard of proof may be more easily overcome, but it cannot pull down the level of certainty an adjudicator must have in order to invalidate a patent.

                1. Ron, your briefs are extremely valuable on this point. I can only thank you.

                  Regarding the PTO and all those who stand in favor of IPRs, their underlying thesis is that the examination provided by the PTO is all but worthless. But rather than promoting some reform of the PTO, they want to be able to re-examine a patent by an inter partes proceeding at any point it is asserted. This means, of course, that a patent cannot be relied upon because when it is needed, it is then truly “examined” and typically invalidated at the rate of above 70%. They could care less that the system they have erected does not permit a patentee to have a reliable property interest in his patent, a reliability that is so necessary when making investments. The patent system they have brought America is, to say the least, FUBAR.

                2. [T]he presumption of patent validity). Rather, the presumption of validity under the clear-and-convincing-evidence standard is an immutable adjudicatory standard matched to the large asymmetry in the countervailing risks to the litigants…

                  This is an excellent point, stated clearly & persuasively. Nevertheless I would like to make two quibbling responses:

                  1) You show, convincingly, that there is a good reason why c-&-c should be the evidentiary standard. That does not quite go as far as to show that this rule is “immutable.” The fact that the policy should be set in a certain way is no guarantee that Congress will set it that way (see, e.g., §316(e)). In any event, you have convinced me that we would do better to revise §316(e) to require c-&-c.

                  2) That said, while you have convinced me that c-&-c is the right standard as a matter of optimal public policy, I could envision a cogent push-back to your point about “disclosure… published upon consummation of the patent bargain…,” viz. no that Congress has installed §316(e) in Title 35, IPR challenge is part of “the patent bargain.” Not as to pre-AIA patents, of course, but as to AIA patents, if you signed up knowing that your patent is subject to challenge in IPR under a preponderance standard, you can hardly complain “that is not part of the bargain.”

                3. [T]hose who… favor of IPRs… want to be able to re-examine a patent by an inter partes proceeding at any point it is asserted. This means, of course, that a patent cannot be relied upon because when it is needed, it is then truly “examined” and typically invalidated at the rate of above 70%.

                  Two responses:

                  1) I just do not see how your conclusion (“cannot be relied upon”) follows from your premise (can re-examine a patent at any point). Obviously the aspect of “re-examination” that a patentee might fear is not the possibility of amendment (over which the patentee enjoys complete control), but rather the possibility of invalidation. One has always been able, however, to challenge a patent’s validity whenever it is asserted. At most, IPRs mean that this challenge becomes very slightly easier. This is a change in degree, not kind.

                  Can it really be the case that any slight change in the relative ease of invalidation might strike so serious a blow to the patent system? If so, why have you not expressed similar concerns about KSR or Alice, which have done at least as much to ease the standards for invalidation?

                  2) Where are you getting that 70% figure? IP Watchdog had an excellent report from Lex Machina that showed that ~65% of the time that someone petitions for IPR, the end result is no claims cancelled, and ~70% of the time, the patent comes through with at least some of the challenged claims intact.

                4. Greg, your reasonable comment “That does not quite go as far as to show that this rule is ‘immutable.’” is fair given the unfamiliarity of most observers with SCOTUS’ jurisprudence on standards of proof. Given the large disparity of risk of adjudication error, the C&C standard is “immutable” as the Fifth Amendment to the Constitution: “In any given proceeding, the minimum standard of proof tolerated by the due process requirement reflects … how the risk of error should be distributed between the litigants. The minimum standard is a question of federal law which this Court may resolve. Retrospective case-by-case review cannot preserve fundamental fairness when a class of proceedings is governed by a constitutionally defective evidentiary standard.” Santosky, 455 U.S. at 745–46 (emphasis added). The IPR preponderance of evidence standard is “a constitutionally defective evidentiary standard.”

                  As to your point of applicants having “signed up” and consented to post AIA IPRs, your “forfeiture of rights” leap is simply just that – a leap without a legal basis. This is a leap as to all patents, including post AIA-filed patents; but would you at least agree that your point is wrong when it comes to patents filed before the AIA?

                5. [W]ould you at least agree that your point is wrong when it comes to patents filed before the AIA?

                  Definitely. I thought I had made clear as much when I wrote “[n]ot as to pre-AIA patents, of course… .” If I was not clear, please know that I agree that subjecting pre-AIA patents to IPRs is unconstitutional for the reasons that you have explained.

                6. Ron,

                  Greg has already acquiesced to the point concerning pre-AIA patents.

                  However, on the view that some “tacked-on” requirement is somehow allowed to violate other Constitutional protections, see the point presented by Loderunner at post 15.

                7. Your allusion to Loderunner’s discussion of unconstitutional conditions in #15 would be more convincing if you could—you know—actually name a particular constitutional provision being violated, rather than vaguely gesture at “protections for property.”

                  To paraphrase Prof. Pollock, “proof of [unconstitutionality] in the air, so to speak, will not do.” Palsgraf v. Long Island R.R., 248 N.Y. 339, 341 (1928) (Cardozo, C.J., quoting Pollock, Tort’s, 11th ed.).

                8. Greg, the reliability comes from the heightened standard of proof. The use of the lower standard of proof combined with BRI is not a slightly easier method of determining validity. Not slightly at all.

      3. “There are no new references”? NW you must have only clients that are omnivorous readers of U.S. and foreign patent applications and with photographic memories? Not to defend Duffy, but in more than 44 years of patent practice [with necessarily having to ask inventor-experts about their knowledge of prior art that could be material to what they wanted patented] on numerous if not the majority of occasions I or the examiner found material references they were not aware of or did not remember. Even a few cases of experts forgetting material information that was in one of their own many prior publications!
        Do you realize that prior art can include an indexed single copy of a thesis in a single foreign library, as in the famous Blackberry patent suit?

    3. I don’t Stern v. Marshall is really dispositive because it was clear in that case that the tort was a common law tort. So, here the question is whether the issue of validity should be resolved in common law.

      So, Stern v. Marshall gets us that if validity should be resolved in common law, then IPRs are unconstitutional.

  4. I respect the creativity of the argument, but it confirms that intellectual property attorneys like the ones who wrote this brief really don’t have any business writing about constitutional law issues.

    The brief totally ignores the well-established doctrine of “unconstitutional conditions,” which provides that the government cannot condition the provision of a discretionary benefit upon relinquishing a constitutional right. I suspect the authors who wrote the brief didn’t even know the doctrine existed.

    Anyway, the doctrine goes back to the early 1900s, and the issue comes up frequently in the context of government contracting and benefits (such as for federal highways and other contracts), but the rationale is clearly applicable here. The Supreme Court has repeatedly stated that the government’s authority to confer discretionary benefits like contracts, tax exemptions, etc. (and I would consider patents to be among them) cannot be conditioned upon the person accepting an abridgment of their constitutional rights.

    So if the Klarquist brief is correct, that accepting IPR was somehow a “condition” of getting a patent, it makes no difference. Because if IPR is unconstitutional, then accepting IPR would be an unconstitutional condition. End of story.

    I personally don’t think there’s a snowball’s chance in Hell that the Court will invalidate the IPR procedure, but this misguided “conditions” argument doesn’t move the ball. Next brief, please…

    1. “I personally don’t think there’s a snowball’s chance in Hell that the Court will invalidate the IPR procedure….”

      Why?

      But I agree with you that patent lawyers arguing on both sides of Oil States generally do not have a clue of even what the issue is.

      1. Ned, yea, I made the comment about “patent lawyers” and constitutional issues because it seemed weird that the lawyers who worked on it didn’t acknowledge the doctrine of unconditional conditions. If they had known about it, it seems doubtful that they would have explicitly and repeatedly characterized IPR (and the attendant relinquishment of a right to jury trial under the Seventh Amendment) as a “condition” of getting a patent. The brief does show creativity and was written by very smart lawyers, but I think the “conditions” rationale might not have been fully thought out.

        To answer your other question, Ned, I really don’t see the Supreme Court invalidating IPR. It’s not because I want them to rule on the issue one way or another. I never thought too much of the Article III argument, but the Seventh Amendment argument is potentially more problematic to IPR.

        But the problem is that, upon reviewing all of the briefs (and knowing just enough about constitutional law to get me into trouble), the Petitioners simply haven’t made a compelling case that in cases involving ONLY invalidity challenges to issued patents (NOT also seeking damages for infringement), a Seventh Amendment right to jury trial attached. Even today, validity-only challenges in courts are treated as declaratory judgment actions, a purely equitable remedy to which no jury trial right attaches.

        The Seventh Amendment, by its terms, turns this into a historical inquiry. And I have to say, the evidence is at best ambiguous. Both sides have made made the proper arguments, but in the end, there just really isn’t a clear answer to the jury trial question.

        And therein lies the problem. Given Congress’s near-plenary authority over patents vested by the constitution, the Supreme Court is not going to want to dismantle the IPR regime enacted by Congress without a very clear constitutional violation.

        My prediction is they are going to sustain the AIA post grant proceedings and won’t even have to resolve the Seventh Amendment question, nor will they even have to address the “public rights” issue. They will simply say that IPR and other post-grant remedies are an integral part of the statutory scheme for patents that Congress, and I predict it will be a narrow decision that leans heavily on the characteristics of the patent system.

        1. “Even today, validity-only challenges in courts are treated as declaratory judgment actions, a purely equitable remedy to which no jury trial right attaches.”

          You do know that Lockwood held the opposite — that there was a right to a jury trial with respect to a DJ actions for invalidity?

          “The Declaratory Judgment Act, passed in 1934, ch. 512, 48 Stat. 955 (codified as amended at 28 U.S.C. §§ 2201-02 (1988)), created an action unknown at common law.[7] 973*973 10A Charles A. Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure § 2752 (2d Ed.1983). Designed particularly to assist potential litigants unable to settle their rights and liabilities through then-existing procedures, an action for “declaratory relief is sui generis and is as much legal as equitable.” Borchard, supra note 7, at 26-28, 239. Indeed, from the Act’s passage in 1934 until the merger of law and equity in the federal system in 1938, declaratory judgment actions were heard on both the law and the equity sides of the federal courts. See, e.g., United States ex rel. Guest v. Perkins, 17 F.Supp. 177 (D.D.C.1936) (law side); Texas Co. v. Wilkinson, 21 F.Supp. 771 (E.D.La.1937) (equity side). This has led a number of courts to remark that declaratory judgments are neither legal nor equitable, rather than both. See, e.g., Gulfstream Aerospace Corp. v. Mayacamas Corp., 485 U.S. 271, 284, 108 S.Ct. 1133, 1140-41, 99 L.Ed.2d 296 (1988); Hartford Fin. Sys., Inc. v. Florida Software Servs., 712 F.2d 724, 727 (1st Cir.1983); American Safety Equip. Corp. v. J.P. Maguire & Co., 391 F.2d 821, 824 (2d Cir.1968). The variety of formulations should not, however, distract one from the basic point: declaratory judgment actions are, for Seventh Amendment purposes, only as legal or equitable in nature as the controversies on which they are founded. See Fed. R.Civ.P. 57 (“Declaratory Judgments”); Simler v. Conner, 372 U.S. 221, 223, 83 S.Ct. 609, 611, 9 L.Ed.2d 691 (1963) (“The fact that the action is in form a declaratory judgment case should not obscure the essentially legal nature of the action.”).

          As to whether the issue of a right to a jury trial is clear or not for actions to revoke patents for invalidity based on the historical record, do you agree or disagree with I demonstrated in my brief that the writ scire facias was a legal remedy from start to finish and that equity had no jurisdiction in England (and therefor, in the US) to provide a remedy where there was a complete an adequate remedy at law?

          In point of fact, there are no cases in equity revoking a patent for invention in the entire reported history of England. Not one. The government cites none. The infringer cites none. Not one. Nada. Zilch.

          Does that tell you anything?

          1. Ned, you have not directly responded to his factual statement of current law that: “validity-only”* challenges in courts are treated as declaratory judgment actions, [as] a purely equitable remedy to which no jury trial right attaches.” [You have only responded with more ancient law.]
            Do you deny that a jury is not required in such cases, or not?

            *no demand for any damages

            1. Lockwood (1995) is ancient law? It held directly opposite from the proposition that DJ actions to invalidate a patent are purely equitable.

              Mein Gott, Paul. Really.

              1. Fine – then all you needed to say in response to his statement of law is that that is not the law for purely invalidity challenges in D.C.s, even in a modern declaratory judgment action, per the 1995 Fed. Cir. Lockwood decision.

              2. You are correct, Ned, I stand corrected. Lockwood was a combined damages/invalidity case at first, but the patentee dismissed its infringement claim, so the jury trial right there was indeed based on the invalidity DJ claim.

                I still don’t think that matters all that much, since Lockwood was vacated by the Supreme Court and isn’t binding on them anyway.

                1. Lode_Runner, the problem is that the government briefs do the same thing as you did, make the bald assertion that a DJ action is an equitable remedy with no right to jury trial without citing authority, when there is authority to the contrary and no authority in support of the statement.

        2. Lode Runner, thanks for your fresh legal thoughts and your fresh and specific prediction for the outcome of this case. I was expecting to see more of this here.
          I would only hazard a bet that this federal administrative law statute constitutionality case will NOT be decided on the basis of 200 or so year old Sup. Ct. decisions, and 300 or so year old British decisions, that have been so extensively argued on this blog.

          1. I would only hazard a bet that this federal administrative law statute constitutionality case will NOT be decided on

            While you thank someone ELSE for a “fresh and specific prediction,” you once again merely snipe from the sidelines with a “will NOT be decided” – absent any touch upon the merits, and absent any evidence of critical thinking of your own.

            Am I surprised?

            Would anyone be?

    2. the government cannot condition the provision of a discretionary benefit upon relinquishing a constitutional right.

      You mean something that a previously existing (and unchanged in and of itself) property right cannot have some new law “tacked on” in which that new law does not abide by other Constitutional protections (based on the property aspect)….?

      (I don’t think so, but the items run in such a similar vein, that I could not help but jab certain IPR defenders – and others who are simply anti-patent).

      As to “personally don’t think there’s a snowball’s chance in Hell that the Court will invalidate the IPR procedure” – what is the rationale that you see the Court advancing?

      1. > You mean something that a previously
        > existing (and unchanged in and of itself)
        > property right cannot have some new law
        > “tacked on” in which that new law does not
        > abide by other Constitutional protections
        > (based on the property aspect)….?

        What you’re talking about is more of a Takings analysis, and that’s a loser argument as confirmed by the fact that no one has leaned on that rationale to invalidate IPR.

        The amicus brief is instead taking the position that, even if IPR is unconstitutional, it doesn’t matter because patent owners have effectively consented to post-issuance PTO determination of validity, without a jury, as a condition of getting a patent. The brief’s evidence of this “condition” is the existence of analogous reexamination procedures that have been in place for decades that had characteristics similar to IPR. (The analogy to inter partes reexam works, but ex parte is a stretch since it’s not adversarial.)

        The problem is that, as my original comment said, the argument goes nowhere. If IPR unconstitutionally deprives patent owners of their rights (under the Seventh Amendment, Article III, or whatever), then “condition” of accepting IPR or procedures like it is an unconstitutional one, and thus the argument fails.

        1. If IPR unconstitutionally deprives patent owners of their rights (under the Seventh Amendment, Article III, or whatever), then “condition” of accepting IPR or procedures like it is an unconstitutional one, and thus the argument fails.

          Nobody has rights “under” Art. III (except maybe federal judges, who could, one supposes, speak of a “right” to life tenure employment without diminution of salary). As for VII amendment, no one has a right to a jury trial in a suit against the government. Sovereign immunity is a well established exception to the VII amendment jury right.

          In short, Congress conditioning the patent on an acquiescence to IPRs cannot run afoul of the unconstitutional conditions doctrine because there are no “rights” actually at stake here. One cannot be deprived of a right that one never had in the first place.

          1. … last time I checked, trial by jury under the Seventh Amendment was, when applicable, a “right.”

            Sovereign immunity doesn’t work here, either. An IPR is not a “suit against the government.” It’s an adversarial proceeding with two opposing parties, a petitioner and a patent owner. It happens to be heard by the PTO instead of a court, but it was designed to have the hallmarks of adversarial litigation.

            1. An IPR is not a “suit against the government.”

              Think about Cuozzo, the very first IPR case ever in front of the SCotUS. Who was on the other side of that case from Cuozzo Speed Tech.?

              When the patentee appeals from a holding of unpatentability, what is the patentee seeking.? Retraction of the certificate of correction that the PTO has applied, no?

              Can the IPR petitioner retract that certificate? No.

              Can the government? Yes.

              So, who, really, is the party across the “v.” in an Art. III appeal from an IPR invalidation?

              1. Greg, you are right. Even a scire facias was the government vs. the patent owner, with the petitioner paying for the proceeding. The fact that a petitioner in an IPR is a named party is not different in kind from a scire facias.

            1. Well, you are certainly correct that I am restating my “tacking on” position. Naturally, I will not agree that this is an sort of error. From where I am standing l, this is another instance of you digging deeper into your obscurantist supposition that there is some sort of constitutional obstacle to Congress adding another condition to the patent grant.

              1. obscurantist supposition that there is some sort of constitutional obstacle to Congress adding another condition to the patent grant.

                LOL – it is not “some sort of” – it is a basic maxim.

                One cannot add an unconstitutional condition to anything.

                For some reason, YOU are the one being “obscurant” and you are the one merely repeating an error shown to be an error through simple and direct logic.

                And this too is the very thing that Lode_Runner points out – and that you so casually disregard.

                You are always free to close your eyes to the counter points presented – but you are not free to say that those counter points do not exist or that they have not been presented. That’s just poor gamesmanship on your end. Just as “Naturally, I will not agree that this is an sort of error” just because where you are standing is a place that you do not want it to be an error. It clearly is an error whether or not you want it to be, whether or not you are standing here or there, whether or not you choose to label anyone else. The error remains yours.

        2. that’s a loser argument as confirmed by the fact that no one has leaned on that rationale to invalidate IPR.

          That’s extremely poor logic.

          “Not tried” is not synonymous with “not work.”

          But don’t get me wrong – my post was admittedly a side step to your thoughtful “condition” analysis – and certainly not meant to displace your point.

    3. One thing I think you have wrong is you say that IPRs are only for validity of the patent, but I think that gets mixed-up because anyone that is sued in federal court can then go to the PTO.

  5. “Since 1980, every patent applicant has consented to the substance of this reexamination as a maintenance condition for each granted patent”

    “https://patentlyo.com/patent/2010/02/appealing-a-bpai-rejection-in-an-ex-parte-reexamination.html”

    “The caveat is that reexaminations filed prior to the 1999 amendment of §145 may also be appealed to a district court under §141. ”

    The amici gives 1980 as the year the consent was given. However, the above by Prof. Couch seems to give 1999 as the starting date of consent if any as the Patent owner/application had option to challenge BPAI in district court till 1999.

    Can any one please clarify why the Amici is talking about 1980 repeatedly?

      1. But, this is where their blatant dishonesty is revealed, Dennis. The point of the argument is that as of 1980, patent owners no longer had a right to a day in court before their patents were repealed. Congress amended Section 306 (“secs. 6(h)(2) (effective Sept. 16, 2011)”) to remove the right of a de novo “appeal” to the district courts.

          1. Won’t happen.

            Ned’s ability to hold any thought is heavily conditioned on the aim of his Windmill Locator.

            He cannot even acknowledge plain history when that history goes against his favorite Windmills.

  6. Why does anyone think the SCOTUS will save us from IPRs when they created Alice? Alice is surely unconstitutional. And, the justices knew exactly what they were doing with Alice. They made it so a judge could invalidate any patent claim on SJ. Given this, why would they care? They will decide IPRs on public policy grounds.

  7. Isn’t all of this a bit of a red herring?

    Are any of these other vehicles actually properly before the Court?

  8. Greg, reading between your lines, I gather that you do agree that IPRs cannot be stuck down as unconstitutional without also striking down at least all inter partes reexamination decisions, etc. on all prior patents, as well?

    But [I hate to say it], your last paragraph above wanders off like Gene’s blog onto the very different subject of alleged but unsupported lack of constitutional “due process,” which is not in issue here, and which no one has ever consented to. The Fed. Cir. already enforces constitutional due process on IPRs – remanding IPRs that violate it.

    1. Er, no, you are wrong on both points, which is no doubt my own fault for lack of clarity.

      I gather that you do agree that IPRs cannot be stuck down as unconstitutional without also striking down at least all inter partes reexamination decisions, etc.

      No, actually, I meant to say exactly the opposite. If you applied for a patent after the advent of ex parte re-exams, then you implicitly consented to ex parte re-examination of your claims. Congress is entirely within its rights to attach limitations such as ex parte re-re-exam to the patent grant, so there is nothing about holding IPRs unconstitutional that would necessarily imply that ex parte re-exams are unconstitutional (at least with regard to patents currently in force). Same goes for inter partes re-examinations and patents with application dates on or after 29 Nov 1999. The reason that IPRs are unconstitutional (at least in an as-applied challenge) is that the PTO is dragging pre-AIA patents into IPRs. Pre-AIA applicants never consented to IPRs, and therefore it contravenes the V amendment takings clause to subject pre-AIA patents to IPRs (unless the patentee consents, but that is a fact pattern that is never going to show up).

      [Y]our last paragraph… wanders off… onto the… subject of… lack of constitutional “due process”…

      My apologies if I gave that impression, but I did not mean to bring up due-process. I know that certain folks think that there is a due process problem with IPRs, but I do not. My point is that if I consent to ex parte re-exams, then I have consented to ex parte re-exams—full stop. You cannot boot-strap my consent to ex parte re-exams into a constructive consent to IPRs. Just as a consent to arbitration in front of one particular arbiter is not consent to arbitration in front of anyone in the world, so to consent to one particular post-grant proceeding is not consent to any possible post-grant proceeding that someone can later dream up.

      1. As I indicated below, I think there are fair points to be raised.

        But I don’t think the distinctions between re-exam and IPRs are substantial enough in the context of the alleged Constitutional issue to make a difference.

        Pretty much every rule change at the PTO could be challenged as non-binding on previous filers if you follow Greg’s reasoning strictly.

        Pre-AIA applicants never consented to IPRs

        True enough, but they understood that their patent could be challenged by a third party before the granting agency, and that challenge could lead to the granting agency tanking the patent. Does a time limit of a year for the agency to make the decision change things? Sure. But so would a rule that expanded the number of pages a petitioner could use for its initial brief. Or a rule that substantially reduced the cost of filing/prosecuting a request (or increased the cost).

        I would argue that the tweaks introduced by the AIA are the sort of tweaks that would be understood to be part of the bargain in the area of ex parte and inter parte review. The PTO is a regulatory agency and it regulates an aspect of commerce. It must be able to adjust and it can’t be the case that every one of those adjustments applies only pro-actively (as opposed to retroactively).

        It’s worth remembering (again) that the people whose heads exploded at the idea of IPRs have the most explosive heads in the history of the patent universe. There is literally nothing that can happen which diminishes the value of patents by any amount which will not lead to shrieking about Der Kernstertershun!! and the decline of Western Civilization generally. This little lobby of rich entitled 1 percenters operates a lot like the NRA except their success rate is way lower (for good reasons which we can all be thankful for).

        Purely for hypothetical sake, if the PTO decided to increase the technical/skill level requirements for employees in the computer arts unit (e.g., hiring people with Ph.D.s or a minimum of ten years industry experience in a specific area in which they will be examining), would that create a Constutional issue? Are applicants entitled to rely on a certain level of incompetence at the PTO throughout the left of the patent? Because they didn’t “consent” to a PTO that was actually competent?

    2. “… consent to arbitration in front of anyone in the world, so to consent to one particular post-grant proceeding…”

      Er, “… consent to arbitration in front of anyone in the world, so too consent to one particular post-grant proceeding…”

    3. Fed. Cir. already enforces constitutional due process on IPRs – remanding IPRs that violate it.

      That is a rather egregious overstatement, given that the court will not go out of its way to attach Constitutional questions and so few people have actually gone about asking the court the right questions.

      We have barely begun to see the tip of the iceberg on asking the court those right Constitutional questions.

      Something, in your own cheerleading mode, have always even shied away from discussing on the merits, Paul.

      It is more than a bit duplicitous if you then with this post to suggest otherwise.

      1. The “merits” of the constitutionality of IPRs are fully expressed on both sides [with support] in the party briefs and amicus briefs in this Sup. Ct. case. Where they might actually mean something, or be of any relevance. Whereas mere expressions of mere personal opinions by non-constitutional-law-expert individuals on blogs do not. The only thing that will have any real relevance will be the actual decision of the Sup. Ct. in this case, no matter how many times you insist you know more than they do about constitutional law.
        If you want to do something useful, read read these briefs and discuss their specific arguments, as some others have been doing.

        1. Paul mere expressions of mere personal opinions by non-constitutional-law-expert individuals on blogs do not

          Not to be a total contrarian here (because I understand the point your making), but I think that a good argument is a good argument and can (and often will) have an impact regardless of who/where the argument originates.

          Like everyone else, I can’t see anything resembling an argument in “anon”‘s comment. That’s the problem.

        2. are fully expressed

          Not even close.

          And certainly not on point as to ANY of your own unwillingness to do anything but snipe from the sidelines.

          Where they might actually mean something, or be of any relevance

          If so – then why are YOU still taking those snipes from the sidelines and trying so very hard to squelch any meaningful discussion outside of legal briefs to the courts?

          You sure do spend a lot of time doing something that you at the same time claim to be meaningless.

          If YOU want to do something useful, stop being duplicitous and actually roll up your sleeves and engage.

          (I won’t be holding my breath)

  9. I used to work with John, and I believe this is the best argument – How is an IPR unconstitutional but invalidation of an issued patent via a reexamination was not? However, the consent argument is a reach, at best.

  10. The consent does not start at the point of filing a patent application.

    The consent starts when someone starts their career in science.

    The consent starts when someone invests their money to do R&D.

    1. Sorry, but I do not grasp your point here. If the results of R&D are successfully maintained as a trade secret, which does have commonly law foundations, I believe, where is the consent to government invalidation of the extant right?

      1. “If the results of R&D are successfully maintained as a trade secret”

        Its very difficult once some one finds a particular invention works and it has market demand, to prevent being reverse engineered.

        Only a few of R&D ideas work in real life. Of these only very few work in market place. If one can then reverse engineer, it will be absolutely impossible to invest in it.

        Try this. Take few thousand dollars, real money..look for a start up and try to figure out which will succeed. Try with your hard earned money. Then you will know.

        It will be absolutely impossible for you to buy in most of them if there are no legal protections.

        1. Ok. But I never claimed that trade secrets are a superior or even equivalent form of protection to patents. I fully understand the reverse engineering caveat, but the patent vs. trade secret debate is always going to be case-specific. Regardless, I do not see how any of this supports your contentions that “consent starts when someone starts their career in science” and “consent starts when someone invests their money to do R&D.”

          1. By the time patent application is filed, the research investment disclosed in patent application is spent – is that not obvious?

            Would you figure out whether a certain type of house can be built at the time of registering your house, or when you start digging the land? Would you be happy if the municipality changes their requirements after you built your house and won’t register it?
            The consent was at the time of buying the land. Not at the time of registration.

        2. It will be absolutely impossible for you to buy in most of them if there are no legal protections.

          Meanwhile tons of people invest in businesses all the time, every day, without patent protection.

          look for a start up

          LOL

          Again, there are tons of start ups with perfectly acceptable and patent-worthy innovations to protect. Invest in them! And don’t invest in the “do it in a computer” junk that will be out-of-date in two years, along with the worthless “patent application” that was cranked out in 8 hours by some 23 year old patent agent whose knowledge of patent law and the history of computing could fit in a thimble.

  11. At the time of Patlex, reexaminations were subject to de novo review. Any complaint that the patent owner was being denied his day in court seems a bit misplaced in light of this fact. The District Court in Patlex v. Mossinghoff held that there was no constitutional violation because of the right of de novo review.

    Similarly Supreme Court in Stern analyzed Crowell to the effect that the Workmen’s Compensation statute before it was constitutional because only a District Court court could enforce the orders of the administrative tribunal, and further because, upon that review, the District Court could conduct a de novo review of “constitutional facts”extending to its authority. With Hyatt v. Kappos as now controlling law, that de novo review also includes de novo review of underlying facts as found by the agency to the extent that there is new evidence produced.

    I argued this point to the Federal Circuit in MCM’ s appeal to the Federal Circuit in our reply brief. We also argued this point to the Supreme Court in our certiorari.

    Furthermore, in Executive Benefits, the Supreme Court held that an actual de novo review wiped away any constitutional violation.

    Therefore, the simple response to all these briefs is the fact that reexaminations had a right of de novo review by statute until removed by the AIA. The only reason they might be in jeopardy today is because Congress removed the right to de novo review from the law in 2011.

    One should also say that a review of the re-examination of an issued patent should also include the right to try disputed facts to a jury. That right does not exist with respect to the original ex parte reexaminations but should exist with respect to review in the case of an issued patent.

    1. Ned, I don’t understand your last paragraph. I must assume that you are mixing wish lists with law?] As the law has stood for 5 years since the AIA was enacted, there is no so-called “de novo” [it was not ever fully de novo and those statues never used the words “de novo”] judicial civil action review available for any PTO post-grant proceeding – not for reexams, interferences, derivations, PGRs, etc. Thus, no valid distinguishing basis for holding IPRs unconstitutional without rendering all of them unconstitutional.

  12. Absolute power corrupts absolutely.

    How can so much power be given to one government office?

    Our framers had multiple checks and balances (courts, senate, house, president) for a reason.

  13. Interesting that Gilead is supporting IPRs, even though IPRs were just filed against its major drug product.

    1. Yes, that is interesting—that innovator pharma is backing IPRs. Why, you might even look at that and conclude that all the ballyhoo about IPRs destroying innovation is just self-interested nonsense.

      Gilead is part of an industry that depends on a well functioning patent system. IPRs are part of a well-functioning patent system. That is why Gilead backs IPRs, even if so-called “industry organizations” such as BIO are more skeptical.

      1. Perhaps Gilead wants to diversify their business model by operating as both a branded and generic pharma company. To that end they may want to maintain the ability to attack branded pharma patents outside Hatch-Waxman.

  14. This same SAP America Inc. et al Oil States amicus brief also argues re consent and long acceptance for non-Article-III PTO claim cancellations that:
    “Congress imposed on all utility patent owners steadily increasing periodic fees to maintain a patent, on pain of termination of the patent should the fee not be paid. Act of Dec. 12, 1980 .. This maintenance fee requirement took effect upon enactment. .. Failure to pay the required maintenance fee will terminate a patent
    even if it is being asserted in court.”

  15. I have some sympathy for the devil too.
    link to cdn.patentlyo.com
    I would even refrain from mowing down all the laws to get to him (in the Sir Thomas More manner).

    I would even give the devil his due.

    But I will make no deal with the devil in order to save the abomination that is the AIA

  16. Senate Re pu k k k es just voted to nullify a rule that let consumers form class action lawsuits to sue banks or credit card companies.

    No Democrats voted for it.

    But Hillary gave a speech to Goldman Sachs so … both sides.

    Deep stuff! Brought to you mostly by the same exact people who believe that Der Kernstertershun prevents Congress from creating an agency-revocable “patent right”. The most important people evah!

  17. The “consented” is nonsense. It is like a click-through contract. There is only one game in town so you have to take what you can get. “Consented”. What a joke.

    1. There is only one game in town so you have to take what you can get.

      Correct, but that is just the nature of the patent system. You cannot get more protection that Congress is willing to grant.

      1. The issue is whether applying for a patent means you have “consented” to the terms. I don’t think it does. I think it is like if there is only one place to get water and they add some lead to the water. You have to drink the water because it is all there is. So, there is no “consent.” That seems to imply that there is a marketplace and there are choices other than not apply for a patent.

        1. That seems to imply that there is a marketplace and there are choices other than not apply for a patent.

          There is a marketplace.

          I seem to recall that there was an element of competition at some point. You know, you would work hard to make a better product, find the best employers, the best marketing people, and you would outcompete other players in the market.

          And then at some point (we know pretty much exactly when) there was a shift to a game where instead of actually making something, you just sat in front of computer and typed words describing how to apply logic to information in some context (either broadly defined, or narrowly defined, depending on how hard you pushed and how asleep the Examiner was). And then you just file lawsuits. This was is an actual business model employed by attorneys and still employed by attorneys to this day. Just ask JNG, the apparent inventor of the “proxy server.”

          This isn’t “competition in the marketplace.” This is just b ott 0m – feeding, tr 0lling, and systemic rot.

          Here’s the really big news flash: there are lots of other ways to make money in “the marketplace” without filing for a patent. Some of them are “innovative” (at least you would certainly think so)! And hardly anybody bothers to file patents on those methods. Instead they choose to compete based on their business skills. And they succeed. I know this is hard for you to believe but it’s true. Try to get out a little more often and mingle with ordinary people.

            1. I do admit that making products was a lot more fun than being a patent attorney.

              Get out of the profession!

              Just kidding.

              You know, you can do both. Work-life balance is important.

        2. [I]t is like if there is only one place to get water and they add some lead to the water. You have to drink the water because it is all there is. So, there is no “consent.”

          If you do not find the idea of “consent” to be helpful to the discussion, well, fair enough. The complaint you are making, however, would be equally apt if applied to any other aspect of the patent system.

          Imagine a patentee who said “I don’t agree to 20 years from filing. My idea is real genius. I should get 50 years.” Would you feel that this guy had been ill-used when the judge says “Sorry. Twenty is all you get.”?

          I know that I would not feel too bad for that guy.

          I feel just the same about the fellow who files today but complains “I never consented to IPRs.”

          1. Greg, your analogy is not fair. We are discussing whether IPRs are Constitutional. Their “consent” arguments is being used for leverage for the Constitutional question. Your 50 year argument would only be relevant if the Constitutional question was whether 20 years was Constitutional.

            1. As against someone who filed ten years ago, I agree that it is crazy to say that s/he “consented” to IPRs. It is an unconstitutional trespass against that patentee’s property rights to subject the ten-year-ago applicant to IPRs.

              If you apply today, however, then you consent to IPRs in exactly the same way (and to exactly the same extent) that you consent to 20-years-from-filing. There is nothing unconstitutional (or contrary to the expectations associated with property) to say that you get what Congress is offering (including all the conditions that Congress attaches) or nothing at all. There are no bespoke patents, and everyone knows that upfront.

              1. Wrong.

                Your view is simply wrong Greg and falls to the “Congress can do anything” line of thought.

                That simply is not true as even Congress is not empowered to write subsequent law that is in violation of other Constitutional protections.

                1. What “other Constitutional protection” is being violated?

                  Protections afforded property.

                  No other property comes with a 20 year time limit, and yet I do not see a lot of squawking about the injustice of time-limited rights. In other words, we all agree that Congress gets to set conditions (such as the 20 year limit) on patents, and yet we all acknowledge that such conditions are not inconsistent with the nature of patents qua property.

                  Similarly, there is no necessary inconsistency between acknowledging patent to be property, even in a world in which Congress creates an administrative process for the review of improvidently granted claims. The particular sort of property known as patents or copyrights are creations of Congress, and Congress is free to condition those property rights (upfront) largely as Congress sees fit, so long as the conditions do not contravene some other constitutional provision (e.g. equal protection, freedom of speech, etc.).

                2. Incidentally, the fact that you cannot name even a single actual constitutional protection, and are instead obliged to handwave at “[p]rotections afforded property” (which ones?, in which constitutional clause?) in response to my question, tells the world everything it needs to know about the seriousness with which it should take your arguments here.

                3. The smell of IPR cheerleading.

                  As if, Gregg, I have not spelled out more detailed views many many many times now.

                  But since I do not jump at your Br’er Rabbit thornbush, I “must not be taken seriously”

                  What utter balderdash.

                  Further, “upfront considerations” are one thing – and those created the notion of property – and critically, those were NOT changed in the AIA. However, there was a “tacking-on” that was changed and that “tacking-on” IS something that still must abide by protections afforded property.

                  Perhaps you simply were not paying attention when I noted that even Congress is not free to make any law that it may want to make.

                  You seem to want to think to the contrary. And you want to be an arse about it as well (even stating what I have stated: so long as the conditions do not contravene some other constitutional provision).

                4. However, there was a “tacking-on” that was changed and that “tacking-on” IS something that still must abide by protections afforded property.

                  Right, which is why I agree that IPRs (as applied) are unconstitutional. If Congress had made IPRs applicable only to applications filed under the AIA, that would be a very different circumstance, and that IPR schema would be constitutionally supportable, because such a schema would not affect any “protections afforded property.”

                5. You are still missing the point that the “tacking on” ITSELF may be improper – and not just because the tacking on is said to affect prior timed items. If the items in the “tacking on” do not comport with the existing and unchanged property nature, then the “tacking on” itself simply does not get a free pass.

              2. You are still missing the point that the “tacking on” ITSELF may be improper… [i]f the items in the “tacking on” do not comport with the existing and unchanged property nature…

                By definition, if the items tacked on apply only prospectively, there is no “existing” nature against which the tacked on might offend.

                In any event, one notes that you are still arguing at a very high-level of generality, based only on vague allusions to “constitutional protections.” If you actually mean to convince anyone, you may have to—you know—cite some cases, or otherwise articulate discernible legal reasoning.

                1. You still miss the point. The matter is NOT that you are “tacking on.” The matter is that WHAT you are “tacking on” may not otherwise violate an existing Constitutional protection of the item TO WHICH you are attempting to “tack on.”

                  And if you need some “discernable” legal reasoning beyond that, then that is a YOU problem.

            2. if the Constitutional question was whether 20 years was Constitutional.

              Arbitrary and capricious! Deprives inventor of True Value! Lord Brownstroke’s footnote in the 1787 House of Gables case Blackgrit v. Bumblebee controls!

    2. That would be a better argument but for the many unavoidable shrink-wrap and click-through contracts [and forced arbitration contracts] that ARE enforceable in most states.

    3. In first reading this, I legitimately thought it was a response to MM’s note about the Senate voting to nullify the CFPB rule re arbitration clauses. Only after reading down a bit did I realize otherwise.

      I’m assuming that everyone that finds the consent argument problematic in a patent context is also upset that Congress voted to kill the CFPB rule re arbitration clauses? I’m sure that’s the case and just going to move on now.

  18. I am sympathetic to the arguments here…

    I am also sympathetic to these arguments, but:

    (1) it just is not true that all pending patents have consented to inter partes re-exams. There are live patents out there still that are older than inter partes re-exams, so it is no good saying that consent to inter partes re-exams makes it all good.

    (2) it is really a stretch to say that inter partes re-exams are so similar to inter partes reviews that consent to one is as good as consent to another. There is a reason why Aqua Prods. did not present until IPRs came along. You not only had the right to file amendments in inter partes re-exams, you had the right to file multiple amendments. Similarly, IPRs have to be done in a year, whereas inter partes re-exams routinely stretched on for several years. This is not an apples-to-apples comparison.

    1. These are fair points. (1) is fairer than (2).

      I think the distinctions between inter partes re-exam and inter partes review are flimsy. It may not be an apples to apples to comparison. Maybe more like an apple to asian pear comparison. The “right” to file amendments in inter partes re-exams is not an unlimited right. You can’t enlarge the scope of the claims. And you need to show support and the amendment needs to meet all the other requirements for patentability. In most cases, these issues are cut and dry for all the claims that “matter” to the patentee.

      The “timing” issue seems equally thin. The bottom line is that a year is more than enough time (question: is there no provision for additional time beyond a year?). As usual, it’s remarkable that many of the same entities who would complain about a year-long time frame for addressing 102/103 (and 102/103 only!) had no problem with “rocket docket” jurisdictions where, over the course of FIFTEEN YEARS, hundreds of defendants were hammered simultanously with deadlines for responding to broad or incomprehensible allegations of patent infringement.

      Lastly, where do the Bayh-Dole march-in rights fit into all this? That’s another instance of Congress expressly limiting so-called “patent rights”, i.e., “patent rights” aren’t inherently a kind of suicide pact where we would allow an “innovator” to use the patent system to withhold legal access to a product or method that is needed to save lives. The Constitution doesn’t prohibit this. If you don’t like that kind of “patent right”, then find some other way to make money.

    2. Greg, yes there are some differences between reexaminations and IPRs, but why are any of those differences relevant to the Constitutional issue here? As the Respondents briefs note, both are Congressionaly authorized to cancel claims administratively by the PTO on the exact same very limited invalidity basis, without using an Article III Court or jury trial, whether or not either party appears or drops out, and cannot award damages or injunctions.

      1. [W]hy are any of those differences relevant to the Constitutional issue here?

        Maybe they are not. I would be delighted for the Court to explain in its Oil States decision that IPRs are constitutionally supportable. Unfortunately, I cannot see how the Court might arrive at that conclusion.

        As the Court has previously acknowledged (McClurg v. Kingsland, 1 How. 202, 206 (1843)), “the powers of Congress to legislate upon the subject of patents is plenary…, there can be no limitation of their right to modify them at their pleasure, so that they do not take away the rights of property in existing patents,” (emphasis added). In other words, Congress can attach restrictions on patents, but they cannot compromise the status of an existing property right. By applying IPRs retroactively, to patents acquired before the AIA came into effect, Congress is doing the one thing that the Court has acknowledged that Congress may not do.

        The amicus here attempts to cure this injury to an existing property right by saying “well they consented.” This would be a good argument if true. Property rights really can be compromised if the owner consents. I just find the argument for consent here to be too weak to be credible. As I said, there are patents in force today—subject under the terms of §315 to IPR challenge—which were acquired before inter partes reviews ever came into effect. That means that the argument is that, because you took your patent subject to ex parte review, you essentially consented to IPRs.

        This is rather like saying that because you consented to arbitration in front of a three-member panel of the American Arbitration Association, you have essentially consented to have your dispute resolved by Beth-Anne DiSarrono in Gerry’s Gin Joint down the street. That argument just does not pass the red-face test.

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