by Dennis Crouch

Maxon v. Funai (Fed. Cir. 2018) (nonprecedential opinion)

In a sweeping judgment,the N.D. Ill. district court dismissed Maxon’s infringement case — finding the claims of the plaintiff’s four asserted patents to be invalid for claiming ineligible subject matter under 35 U.S.C. 101.   On appeal, the Federal Circuit has affirmed.

The patents here are all part of the same family — all directed to a seeming business method of providing an “electronic means of increasing user control over subscription entertainment content.”  U.S. Patent Nos. 8,989,160; 7,489,671; 7,486,649; and 7,171,194.  Although the bulk of the patents were issued pre-Alice (2014), the ‘160 was issued later in 2015.  During prosecution, the examiner did reject the claims originally under Section 101 — that was overcome however by amending the specification to limit “computer-readable medium” to only non-transitory storage.  Of course, that strict line-drawing does not work for the flexible eligibility analysis applied in court.

Claim 8 of the ‘160 patent is listed down below and is treated as representative.  The claim is directed to a device capable of sharing services with other devices.  In walking through the two-step Alice framework, the Federal Circuit first noted the patentee admitted that the patents were directed to an abstract idea — that of “decentralized delivery controlled by the owner of a plurality of devices.” Yes indeed, the opening brief begins with the following statement: “Maxon’s claims are indeed directed to an abstract idea: decentralized service delivery controlled by the owner of a plurality of devices.”  This is a strategy that I probably would have avoided — especially recognizing the strong correlation between the two Alice steps.

While is true that a claim directed to an abstract idea can still be patent eligible if they offer application of an inventive concept beyond the abstract idea itself, that did not work here for Maxon.  Rather, both the district and appellate courts found “the claims merely recite generic computer elements for their basic functions and thus do not transform the claimed abstract idea into eligible subject matter under Alice.”  Maxon had argued that the “ordered combination of the claimed elements” constituted an inventive step. The courts disagreed with that argument — holding that “[t]he only method of reaching the result the patent teaches is, in essence, use of generic computer components for their standard purposes to achieve the result.”

Invalidity Affirmed.

= = = = =

Representative Claim 8:

An audio-video device capable of sharing services with a plurality of other devices within a personal network, the audio-video device comprising:

a computer-readable medium having storage for a first address corresponding to the audio-video device, a second address corresponding to the personal network, and a third address corresponding to a service provider network;

input/output logic configured to receive from a user a desired change to a service capable of being provisioned to the audio-video device from at least one service available generally to the personal network;

a processor in communication with the computer-readable medium and the input/output logic, the processor programmed to prepare an inbound signaling word comprising at least the first address and payload data representing the desired change to the service capable of being provisioned to the audio-video device from the personal network;

and a transceiver providing the inbound signaling word to the service provider network where the service provider network comprises logic to process the inbound signaling word including modifying stored information in a subscriber database to effect the desired change to the service capable of being provisioned to the audio-video device from the personal network,

the transceiver further receiving an outbound signaling word comprising the first address corresponding to the audio-video device and data indicating the desired change to the personal network, the outbound signaling word responsive to the desired change to the service capable of being provisioned to the audiovideo device from the personal network.

The 8th Circuit court of appeals holds court at Mizzou law school about once each year.  Although no IP cases this year, all three slated for tomorrow’s oral arguments are interesting:

Is the right to counsel enforceable in court?: The first case involves the class action Church  v. State of Missouri and Gov. Eric Greitens.   Plaintiffs in the case are “individuals who are currently facing criminal charges in Missouri state court and who are represented by lawyers from the Missouri State Public Defender Office.”  The problem is that Missouri has inadequately funded the Public Defender Office in a way that public defenders allegedly “systematically provide constitutionally deficient legal representation.”  The lower court is allowing the case to proceed.  The appeal by the State argues for immunity.  In particular, the Government argues that: (a) the Eleventh Amendment and the doctrine of sovereign immunity bar Plaintiffs’ claims against the State of Missouri; (b) Plaintiffs’ claims against Missouri’s Governor do not fall within the Ex parte Young exception to sovereign immunity; and (c) that absolute legislative immunity bars Plaintiffs’ claims against the Governor.

Seizing Guns of Someone with Mental Instability who has Committed No Crime:  The second case fits well within recent news cycles.  Mark Wellman v. St. Louis County.  In 2014, Wellman permitted himself to be admitted on a short term basis (96 hour hold) to a psychiatric facility based upon suicide threat.  He was released and has no further relevant medical history.  At the time, Officers were told there were guns in the home — they entered on two occasions while he was hospitalized without permission or a warrant and found dozens of weapons that they confiscated.   St. Louis County then refused to return the weapons unless he jumped through special hoops, including either obtaining a Writ of Replevin or else a “no-danger” note from a treating psychiatrist followed by administrative approval from St. Louis County Counselors.  Instead, he sued – both for a return of the guns and for damages for violating his constitutional rights.  The district court ordered return of the guns, but did not assign any liability under 42 U. S. C. §1983.  Wellman appealed.

Is an RV a residence or a vehicle?: US v. Houck. After snooping through peer-to-peer usage, a Pennsylvania cyber-crimes investigator found six files allegedly containing child pornography associated with a particular IP address. Using a court order, the investigator obtained information that Audrey HJ (the Defendant’s mother) was assigned that particular IP for her home use.  The police obtained a search warrant for Audrey’s Pennsylvania home as well as all “vehicles” present at the time.  At the time of the raid, the police searched Houck’s Recreational Vehicle (RV) (a “fifth wheel trailer”) where he claims to have been living (at the time, the RV was hooked-up to water and electric lines, and its A/C was running).  The district court suppressed the evidence — finding it to be an unreasonable search, and the U.S. government has appealed.

Helsinn Healthcare v. Teva Pharma (Supreme Court 2018)

Helsinn’s petition for certiorari received strong support this week from a bevy of ten briefs amici.  The missing element now is a call from the Supreme Court for the views of the Solicitor General (CVSG) and a resulting brief from the U.S. Government supporting the petition.

The Patent Act bars the patenting of inventions that were “on sale” prior to to the invention’s filing date.  The question on appeal here is whether the AIA limited “on sale” to only include publicly available information — or instead do secret and confidential business deals also count as invalidating prior art (if ever discovered). Question Presented:

Whether, under the [AIA], an inventor’s sale of an invention to a third party that is obligated to keep the invention confidential qualifies as prior art for purposes of determining the patentability of the invention.

I previously wrote about the petition here:

Helsinn v. Teva: On Sale Bar Post AIA

Briefs:

• Brief amicus curiae of Congressman Lamar Smith. Brief filed by Robert Armitage who was a major shepherd of the AIA argues that new law eliminates inventor-focused forfeiture provisions.  17-1229 Amicus Brief of Lamar Smith
•  Amicus brief of American Intellectual Property Law Association. Statute amended the old law — eliminating secret prior art. Final AIPLA Amicus Brief Helsin v Teva 3-30-18
• Amicus brief of Intellectual Property Owners Association. Federal Circuit approach is at odds with PTO interpretation. 17-1229 Brief for Amicus
• Brief amicus curiae of Pharmaceutical Research and Manufacturers of America.  Federal Circuit decision here calls into question “countless” issued patents. 17-1229_tsac_PhRMA
• Amicus brief of Bar Association of the District of Columbia. Decision will chill innovation. 17-1229 Amicus Brief–PDFA.
• Amicus brief of The Naples Roundtable. The “Sense Of Congress” harmonization portion of the AIA should be helpful in the interpretation.  17-1229 Brief of Amicus Curiae
• Amicus brief of The Massachusetts Biotechnology Council.  There is currently too much uncertainty in the law. MassBio Amicus Brief Apr 2 2018 Efile Final – PDFA
• Amicus brief of Boston Patent Law Association.  The case is ripe for review.  17-1229 ac The Boston Patent Law Association
• Amicus brief of The Biotechnology Innovation Organization (BIO). The Federal Circuit’s “Atextual Interpretation” sends mixed messages. 17-1229 Amicus Brief
• Amicus brief of US Inventor, Inc. “The ‘little guy’ stands to bear a disproportionate and the most destructive brunt of this “on sale” bar storm.  17-1229 TSAC Brief

Droplets v. Iancu (Supreme Court 2018)

A new petition for writ of certiorari questions the extent that the Federal Circuit can affirm a PTAB IPR decision on grounds different than those relied upon by the Board.

The rule in the Federal Circuit yes, affirmance-on-other-grounds is allowed so long as the Federal Circuit does not need to decide new issues of “fact, policy, or agency expertise.”  In re Comiskey, 554 F.3d 967, 974 (Fed. Cir. 2009). The Federal Circuit’s approach is in some amount of tension with the Chenery doctrine of Administrative law which advises courts to “judge the propriety of [agency] action solely by the grounds invoked by the agency.” SEC v. Chenery, 332 U.S. 194 (1947).  Droplets asks the question:

Whether “an agency’s action must be upheld, if at all, on the basis articulated by the agency itself” (State Farm, 463 U.S. at 50), or whether a court can substitute its own views for the agency’s whenever the issue is “legal in nature” (In re Comiskey, 554 F.3d 967 (Fed. Cir. 2009)).

There are a few difficulties with Droplets case here – most pointedly is the fact that the Federal Circuit did not expressly rule on other grounds, but instead affirmed without opinion (R.36).  Here, the Droplets argument comes from a “tacit” admission from the PTO Solicitor that the Board’s basis for its decision was inadequate.

Read the petition: droplets v. iancu–cert.petition–FILED

by Dennis Crouch

The Supreme Court patent docket is light this year – at least in terms of granted petitions.  We all await the outcome of Oil States. Conventional wisdom is that the case will be a dud and that the Supreme Court confirm the viability of Inter Partes Review proceedings.  Still, the case is fascinating for its potential dramatic outcome; historic antecedents and core constitutional arguments.  The companion to Oil States is SAS Institute, which focuses on the more nuanced issue of whether the PTO can partially-grant an IPR petition.  [I’ll note here that SAS is something of a sleeper case this term being overshadowed by Oil States (I actually forgot about it when writing this post).  The outcome though could substantially change IPR strategy.]

The third case – WesternGeco v. ION Geophysical has a much more narrow focus – whether lost profit damages are available for an infringer’s extra-territorial use of an unlicensed export.  The case would have been much bigger but for the 2007 Supreme Court decision in Microsoft v. AT&T holding that electronic files don’t count as components under the export provisions of 35 U.S.C. 271(f).

Question presented in WesternGeco:

Whether the U.S. Court of Appeals for the Federal Circuit erred in holding that lost profits arising from prohibited combinations occurring outside of the United States are categorically unavailable in cases in which patent infringement is proven under 35 U.S.C. § 271(f).

I previously discussed WesternGeco’s opening brief and supporting amici (including USDOJ) arguing that lost profits should be available under the Patent Act.  The basic argument is that 271(f) is a form of infringement, and 35 U.S.C. § 284 requires an award of “damages adequate to compensate for the infringement.”  WesternGeco argues that this provision includes lost-profits when proven.  The Federal Circuit disagreed — holding that, after considering the presumption against extraterritorial application of US law, those eventual profits were too remote from the actual act of infringement (component export) to be actionable.

SCOTUS: Damages for Foreign Lost Profits Stemming from US Infringement

The adjudged infringer Ion has now responded along with two supporting briefs.

Respondent’s Brief: The respondent begins its brief with a restatement of the question presented — focusing on the fact that the claimed lost profits are associated with a “third party’s subsequent foreign use of the infringing product.”

Whether a patentee that establishes infringement of its patent is entitled to recover lost profits under 35 U.S.C. 284 for a third party’s subsequent foreign use of the infringing product.

In its brief ION walks through its position:

Petitioner seeks to recover the profits it would have earned for conducting marine surveys in international waters. . . The Patent Act, however, does not allow recovery for an injury that occurred outside the territorial jurisdiction of the United States. The presumption against extraterritoriality forecloses petitioner’s claimed lost-profits damages in this case. . . .

Applying this Court’s two-step framework for analyzing the extraterritorial effect of a statute. . . As to the first step: Section 284, which instructs a court to “award the claimant damages adequate to compensate for the infringement,” gives no “clear, affirmative indication” of extraterritorial reach. RJR Nabisco. . . . As to the second step: it cannot seriously be disputed that awarding lost-profits damages here requires a foreign application
of the statute, because it compensates petitioner
for a foreign injury—one that occurred outside the United States only after third parties took actions abroad. Indeed, petitioner repeatedly dubs its lost profits “foreign.” The only link that petitioner’s foreign injury has to the United States is that respondent’s act of domestic infringement is a but-for cause of that injury—a link the Court has deemed insufficient in applying the presumption against extraterritoriality.

The brief here does a nice job of directly addressing and confronting particular points made by petitioner and the US Gov’t in their briefs.

Both the EFF brief and the Fairchild Semiconductor brief argue, inter alia, that the proposed “worldwide damage regime” will have the negative consequence of overcompensating patent owners.  (quoting EFF brief).

The closest companion case this term is another Microsoft case — this one involving the extraterritorial scope of a U.S. warrant — does Microsoft need to turn-over data stored on a foreign server?

Oral arguments in WesternGeco are set for April 16.

By Jason Rantanen

The regional round of the AIPLA Giles S. Rich Patent Moot Court competition took place last weekend.  I know how much work goes into these competitions–merits briefs on both sides plus preparation to argue both sides–so kudos to all competitors.  Particular congratulations go to the winners and runners-up, who will be competing at the Federal Courts Building in Washington D.C. on April 18-20.  The final round will be heard by Judges Prost, Reyna and Chen.

Spoiler alert: the names of the competitors and schools are listed on the next page.

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Arista Networks v. Cisco Systems (Fed. Cir. 2018)

In what is mecoming a more regular outcome, the Federal Circuit has again vacated a PTAB IPR holding — holding that the USPTO’s panel of Administrative Patent Judges failed to “adequately explain its reasoning on a point that was central to its analysis.”

This time the case involves a PTAB finding for the patentee — that the IPR challenger Arista had not proven obviousness (for several challenged claims of Cisco’s Patent No. 8,051,211).  The identified failure was in addressing a particular argument for how the prior art taught the claimed invention.

Tunneling of Packets: Here, Cisco’s secure networking claims include, inter alia, “tunneling” through an intermediate network – where tunneling is defined as “transmitting a frame without examination, including in layer 2 and layer 3 communications.”  Based upon some claim differentiation, the Board also found that “encapsulation and de-encapsulation” of a frame don’t count as “examination” in this scenario.

In short, while “transmitting a frame” during “tunneling” must be “without examination,” certain kinds of activities involving encapsulation and de-encapsulation are not part of the excluded “examination”—hence may be present in what still qualifies as “tunneling” under the ’211 patent.

Opinion at *5.  The proposed prior art reference (Kunzinger) taught something akin to tunneling, but the PTAB concluded that its intermediary examined the packets.  Arista argued that Kunzinger’s was working with the outer-header of an encapsulated frame — and thus was not examining the frame itself.  The Board did not particularly address this argument.

Unlike the Federal Circuit itself, the PTAB is required to write final written decisions “to ensure that their [judgments] are not ‘arbitrary, capricious, an abuse of discretion, . . . otherwise not in accordance with law . . .[or] unsupported by substantial evidence.’” Pers. Web Techs., LLC v. Apple, Inc., 848 F.3d 987, 992 (Fed. Cir. 2017) (quoting the APA).   The record must include all factual findings, and a “full and reasonable explanation” their foundation and reasoning.

Here, the court finds:

[T]he Board did not adequately explain why “transmission of the IPSec packet” in Kunzinger includes an “examination” excluded from the “tunneling” claimed in the ’211 patent, even while the described use of fields and tags in the ’211 patent is not such an excluded “examination.”

On remand, it will be interesting to see how the Board responds — likely adding a bit more to its 30 page opinion.

My colleague, Professor Erika Lietzan (Missouri) has released a really interesting and thorough article walking through the history of the Hatch-Waxman legislation process beginning with some proposals in the 1970s through its passage in 1984.  The article is important in the midst of increasing calls for reform of the system.

She writes:

[T]he conventional wisdom about the Hatch–Waxman Amendments — as a privately negotiated compromise between the innovative and generic industries in which each gained and each lost — is wrong. . . . The truth is more nuanced, and the balance of benefits and costs different.

Basically – and at the risk of oversimplification – Prof. Lietzan argues that this compromise analysis ignores the important expected broad social benefit of generic involvement championed by Rep. Waxman and Public Citizen.  Lietzan writes that the outcome of this public alliance with generic entrants “made generic companies better off, and it made patent owners worse off.”  That result cannot be explained by the traditional insider-negotiated story.

Read a draft here: Erika Lietzan, The Political Economy of the Hatch-Waxman Amendments (March 13, 2018). Seton Hall Law Review, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3140141

Guest post by Christopher J. Walker, The Ohio State University Moritz College of Law and Melissa F. Wasserman, The University of Texas School of Law

In 2011, Congress created a series of novel proceedings for private parties to challenge issued patents before the newly formed Patent Trial and Appeal Board (PTAB). While the PTAB proceedings are immensely popular, they have also been controversial. A series of legal challenges to these new adjudicatory proceedings are working their way through the federal judiciary and up to the Supreme Court, and the latter is deciding this Term the constitutionality of PTAB adjudication. Yet to date, there has been no sustained comparison of these new adjudicatory proceedings with other agency adjudications. This comparison could be provide numerous payoffs, including highlighting the unique facets of PTAB adjudication that may serve for successful legal challenges as well as providing opportunities for improving the decisional processes of adjudicatory boards.

In The New World of Agency Adjudication, we seek to begin this endeavor by situating PTAB adjudication in the modern administrate state. Every administrative law student learns the basics of “formal” adjudication under the Administrative Procedure Act (APA). The paradigmatic APA-governed formal adjudication involves an evidentiary hearing held before an administrative law judge (ALJ) wherein parties are entitled to oral arguments, rebuttal, and cross-examination of witnesses. The ALJ’s decision is then reviewable by the agency head, who typically can reverse the decision for largely any reason. Thus, the critical difference between APA formal adjudication—also known as Type A adjudication—and the judicial model is that the agency head has final decision-making authority.

The vast majority of agency adjudications today, however, do not take the form of APA-governed formal adjudication. The new world of agency adjudication comprises agency actions that are adjudicated by non-ALJ agency personnel that have diverse titles, such as administrative judge, administrative appeals judge, hearing officer, immigration judge—just to name a few. These non-ALJ judges have less independence and protections than ALJs. A substantial portion of these proceedings are known as Type B adjudications which still require evidentiary hearings, and hence are relatively formal. In contrast to APA governed formal adjudication, however, the APA imposes virtually no requirements on these proceedings including agency head review. Yet similar to Type A adjudication, a common feature of Type B adjudication is that the agency head has final decision-making authority.

How do the PTAB proceedings fit within this modern world of agency adjudication? Although the new PTAB proceedings have many of the hallmarks of APA formal adjudication, they lack at least two features that suggest they should not receive a Type A classification. Perhaps most saliently, the Patent Act requires these proceedings to be presided over by administrative patent judges, not administrative law judges. The second critical difference is that the Director of the Patent Office does not have final decision-making authority over PTAB determinations. Although an aggrieved party to a PTAB proceeding can file a request for a rehearing by the Board, the Director does not have the authority to review PTAB determinations as a matter of right. As a result, we argue the best understanding of PTAB proceedings is that they are Type B rather than Type A adjudication. The more difficult question is how do the new PTAB proceedings stack up to its Type B adjudication peers? We conclude quite favorably. Drawing on a recent ACUS study that focuses on identifying the best practices of Type B adjudications, we find that PTAB meets the majority of these recommendations and scores as well as most Type B proceedings.

Our Article concludes by exploring one critical difference between PTAB proceedings and most Type B adjudications: the lack of agency-head review of PTAB determinations. The standard administrative model vests final decision-making authority with the agency head for a number of reasons, including providing the agency head with policy control and the ability to bring consistency to the adjudicatory board decisions. While the Director does not have the authority to directly review PTAB determinations, she does have the ability to influence PTAB outcomes. More specifically, the Director can assign APJs to a panel that share her policy views in hopes that they will vote in accordance with her preferences. This “panel-stacking” often occurs once a rehearing and an expanded panel has been granted, so that the expanded, stacked panel reverses the original three-member decision.

Although we conclude that the Director’s designation procedures are statutorily authorized, we argue this procedure raises a colorable due process violation. Case law on permissible agency-head designation procedures is relatively sparse. One exception is the Sixth Circuit’s opinion in Utica Packing Co. v. Block, in which the Secretary of Agriculture replaced an agency adjudicator with another when the initial adjudicator failed to rule as she wished. The appellate court refused to accept the argument that the Secretary, having delegated to the agency adjudicator the original authority to resolve certain matters, could reappropriate that power at will based on disagreement with the adjudicator’s conclusions. Instead, the court held, “[t]here is no guarantee of fairness when the one who appoints a judge has the power to remove the judge before the end of proceedings for rendering a decision which displeases the appointer.”

Under the reasoning set forth in Utica, there is at least a colorable argument that the Director’s designation procedures raise substantial due process violations. Similar to the Secretary of Agriculture in Utica, the Director in effect removes the original panel before the end of the proceedings when she designates an expanded panel that she hopes will arrive at a different substantive outcome. Although the Director does not technically replace any judge, the practical effect of adding a sufficient number of new members to reverse the original panel decision is functionally equivalent to the Secretary of Agriculture’s removal of the judicial officer in Utica.

Given this colorable due process concern, our Article concludes by examining alternative mechanisms the Director of the Patent Office could utilize to ensure that PTAB consistently applies the agency’s policy preferences. While a congressional grant of agency head review would be the most straightforward way to proceed, our Article also urges the Patent Office to consider an increased reliance on rulemaking and precedential PTAB decisions. With respect to the latter, our Article encourages the Patent Office to consider streamlining the process by which it designates PTAB decisions as precedential to provide the Director with more unilateral authority in making this determination.

The current draft of our article is available on SSRN here. It’s forthcoming in the California Law Review in 2019, so there’s plenty of time for us to incorporate any comments you may have.

By Jason Rantanen

It’s an exciting time for Iowa Law–we have some phenomenal junior faculty members who joined us this past fall and, as of Tuesday, we have a new dean.  Kevin Washburn, Regents Professor of Law and former dean of the University of New Mexico School of Law, will be joining the Iowa College of Law as its 18th dean in mid-June.

Dean Washburn has an amazing professional history, including serving as the Assistant Secretary of Indian Affairs from 2012-2016 (a position for which he was confirmed unanimously by the Senate), an AUSA in the violent crimes section of the Department of Justice, and General Counsel of the National Indian Gaming Commission.   I’m ecstatic about the provost’s selection of dean Washburn and am looking forward to seeing where he leads Iowa Law.

You can read more at the University’s press release: https://now.uiowa.edu/2018/03/university-iowa-names-new-dean-college-law

By Jason Rantanen

I’m thrilled to announce that this fall’s Iowa Law Review symposium will focus on one of the most significant issues of patent law today: the intersection of patents and administrative law.   The symposium, Administering Patent Law, is co-sponsored by the Iowa Law Review and the center I direct, the Iowa Innovation, Business and Law Center.  I’m looking forward to both serious debates about the impact of this term’s Supreme Court decisions (especially Oil States v. Greene’s Energy) and more wide-ranging discussions about the place of patents, the patent office and patent law itself within the broader context of administrative law.

We have a phenomenal lineup of scholars, including both Professor Chris Walker of The Ohio State University Moritz College of Law and Professor Melissa Wasserman of the University of Texas School of Law, whose post on their recent article Situating PTAB Adjudication Within the New World of Agency Adjudication, I’ll be running shortly.  You can read more about the October 5 symposium on the symposium website.  I’ll post about public registration as we get closer to the date.

by Dennis Crouch

In the America Invents Act (AIA), Congress created two primary new forms of challenging issued patents in an administrative trial setting before the Patent Trial and Appeal Board.  The more popular form is Inter Partes Review while Post Grant Reviews have seen less interest.  The comparative popularity appears to stem primarily from the fact that IPRs can be used to challenge any issued patent — including pre-AIA patents and patents issued years-ago.  PGRs, on the other hand has two important timing limitations:  (1) PGRs are only applicable to post-AIA patents (effective priority date > March 2013); and (2) a PGR petition must be filed within 9-months after the patent grant.  That said, IPRs have a comparative downside: While a PGR may challenge patent claims on any patentability ground (except best mode), IPRs are limited only to anticipation and obviousness challenges based upon prior patents and published prior art.

The Covered Business Method Review (CBM) program is added as a layer atop IPRs and PGRs.  CBMs can only be used to challenge patents directed to financial, non-technological business methods.  However, like PGRs, those CBM patents can be challenged on any ground (including eligibility, enablement, and indefiniteness).  Further, like IPRs, CBM petitions can challenge any patent regardless of its filing and issuance dates.

The CBM program is also Transitional — it sunsets in two years 2020 (no petitions accepted after that date).

Rep. Issa is heading-up hearings and a review of the program to consider whether the CBM program should be made permanent and potentially expanded beyond its current narrow scope.  Issa has stated he sees the program as a more efficient mechanism for eliminating low quality patents.

In the recent hearing, three witnesses testified:

David Hale – TD Ameritrade.  “Thankfully, the America Invents Act appears to have turned the tide [against abusive patent litigation]. Upon the implementation of the CBM process, TD Ameritrade has actively used the process to combat several of the low quality patents brought against it, bringing a total of eight CBM petitions. [Testimony]

John Neumann – Government Accounting Office. “Stakeholders we interviewed generally agreed the effects of the CBM program on innovation and investment have been minimal or mostly positive.” [Report]

Aaron Cooper – Business Software Alliance and former Chief IP Counsel for Senate Judiciary Committee.  “Programs that target specific areas of technology – such as the Transitional Program for Covered Business Method Patents (CBM Program) – are detrimental to the patent system in general, and the software industry in particular.” [Testimony]

Watch the hearing here: