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Groups want review procedure bolstered in Senate patent reform legislation

By Jessica M. Karmasek | May 28, 2015

SAN FRANCISCO (Legal Newsline) - The Electronic Frontier Foundation and three other public interest groups are urging members of the U.S. Senate Judiciary Committee to strengthen inter partes review as part of a Senate-introduced patent reform bill.


IPR is a procedure for challenging the validity of a patent before the U.S. Patent and Trademark Office. The procedure, which allows third parties to challenge bad patents, is conducted by the Patent Trial and Appeal Board, or PTAB.


The review was enacted in September 2012 as part of the America Invents Act. The procedure replaced a previous review procedure called inter partes reexamination.

EFF, a California-based international nonprofit, advocates for digital rights. Last week, the foundation joined Engine, Public Knowledge and R Street in sending a letter to U.S. Sens. Chuck Grassley, Patrick Leahy and members of the judiciary committee.


In their May 21 letter, the groups argue that the procedure needs to be made more accessible to and a more powerful tool for those, such as themselves, acting in the public interest.


“We are proud to support the PATENT Act. We believe it is a well-rounded piece of legislation that, taken as a whole, will directly address a dangerous patent troll problem,” they wrote.


“We understand conversations are under way regarding the Inter Partes Review (IPR) program, a successful cornerstone of 2011’s America Invents Act. IPR is a necessary tool for the public interest and small companies because it offers a more affordable avenue for challenging the mass of low-quality patents on limited grounds.”


They continued, “Because low quality patents are the favorite weapon of patent trolls, we strongly support the IPR proceeding and would object to efforts to weaken it or make it less accessible to resource-limited parties.


“However, to the extent that the Senate believes changes to the contours of IPR -- and other post-grant reviews -- should be considered as part of the PATENT Act, we believe there are areas where these proceedings could be strengthened.”


Grassley, R-Iowa and chairman of the judiciary committee; Leahy, D-Vt. and ranking member of the committee; John Cornyn, R-Texas and committee member; and Chuck Schumer, D-N.Y. and also a committee member, all are sponsors of the PATENT, or Protecting American Talent and Entrepreneurship, Act.


The bill, which was introduced last month and already has the support of the Obama administration, would clarify pleading standards; protect end users; reasonably limit early discovery; create more risk for bad actors; curb abusive demand letters; and increase transparency.


Grassley said at a committee hearing earlier this month that he is “comfortable” with the bill’s current language, but noted there are some concerns among patent holders about processes at the PTO, including IPR.


“They worry that administrative proceedings created by the America Invents Act -- the inter partes review and post-grant review proceedings -- are being abused and are stacked against patent holders,” he explained. “Other stakeholders, however, are of the view that these new proceedings have been very effective at weeding out weak patents.


“I’ve committed to looking at these concerns, determining whether they are valid or not, and working with my colleagues to see what can be done to improve this process.”


EFF, Engine, Public Knowledge and R Street, in their letter to Grassley and the rest of the committee, suggested, among other things, that petition fees for small and micro entities be lowered.


“Current petition fees stand at $23,000 just to institute an IPR challenge. This is before any legal fees. This price is prohibitively expensive for small and micro entities, for whom the Patent Office already offers a discount on many patent filings,” they wrote, adding that the same should apply for IPR.


They contend petitioners also should be allowed to file replies and the right to appeal.


The groups also argue that petitioners should be allowed to raise challenges under sections 101 and 102 of the Patent Act.


“Under current law, IPR is a very limited program, only allowing for challenges based on prior art in printed publications and patents,” they wrote. “Numerous pre-­AIA patents are likely invalid for other reasons, including abstractness and lack of definiteness, particularly following recent Supreme Court decisions in Alice v. CLS Bank and Nautilus v. Biosig Instruments.


“Petitioners should be able to use IPR to challenge patents on these grounds as well.”


In addition, they contend the AIA’s Covered Business Method review should be extended to cover all pre-Alice patents.


The review program, they noted, is the only PTO procedure through which many patents may be challenged under Alice and it is currently set to expire in 2020.


The groups argue the program should be kept open at least long enough for petitioners to challenge any patent that was issued prior to Alice.


“Flushing the system of invalid patents is a task of monumental public interest, and the AIA’s IPR provisions were specifically intended to advance that public interest,” they wrote in their two-page letter to the senators.


“We hope that the conversation about IPR can be enhanced by considering how the program may be made more fair toward those who do a service to the whole economy by challenging low-quality patents.”


From Legal Newsline: Reach Jessica Karmasek by email at patents@legalnewsline.com.

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