Contrary to general euphoria, the America Invents Act does not end the first-to-invent system or patent interferences to determine priority of invention, even for patents issuing from applications filed after the Act’s “first-to-file” effective date (March 16, 2013).
Instead, a provision buried in uncodified § 3(n)(2) expressly requires that the existing interference provisions of 35 USC § 102(g) and 135 “shall apply to each claim of an application for patent, and any patent issued thereon, for which the amendments made by this section also apply, if such application or patent contains or contained at any time . . . a claim to an invention having an effective filing date . . . that occurs before [March 16, 2013]; or a specific reference under section 120, 121, or 365(c) of title 35, United States Code, to any patent or application that contains or contained at any time such a claim.”
This provision extends the two statutory interference sections to “each claim” of an application or patent which is subject to the new first-to-file provisions, where the patent or application contains “a claim” that has a pre-Act effective filing date. More broadly, each claim of a post-Act application or patent remains subject to current interference provisions if the application or patent contains a specific reference to any pre-Act application, since those earlier applications contained claims with pre-Act filing dates. The only post-Act applications that escape the interference provisions may well be applications with no “specific reference” to any pre-Act application, apart from issues of whether specific claims are in fact entitled to pre-Act benefit.
Interferences are likely to endure for some years after the first-to-file provisions become effective, and at least potentially until all patents have issued from applications filed before March 16, 2013, as well as continuations and divisionals thereof. The time bars of current § 135(b) will also be extended, so an interference will be precluded under § 135(b)(1) if an applicant fails to present a claim that is the same or substantially the same as a patent claim within 1 year of patent issuance. Although publication of application A also raises a potential bar under § 135(b)(2), it is not always necessary for a rival to actually present a claim in application B within one year of publication of application A. For example, if application B was effectively filed before Application A, Applicant B can bide its time in presenting interfering claims while prosecution of the earlier-filed application A proceeds through continuation application(s). Moreover, the statutory bars generally do not apply if an applicant presented an interfering claim within the 1-year period, but later canceled the claim during prosecution. Statutory bar issues have not been simple in interferences, and have produced an extensive body of USPTO and Federal Circuit precedent.
A number of interesting questions are left open by the interference provisions of the 2011 Act, which extend the jurisdiction of the Patent Trial and Appeal Board to proceedings in interferences declared before the effective date, but not afterward, in § 6(f)(3)(B). Similarly, a civil action in district court under § 146 and an appeal to the Federal Circuit under § 141(d) are extended only to final decisions in interferences that are commenced before the effective date, by § 6(f)(3)(C). The Board’s jurisdiction, and the extent and forum of judicial review, are thus uncertain for post-Act interferences.
The unqualified extension of § 102(g) also raises interesting issues, because the current statute contains two subsections, the first of which refers to an interference based on proof of prior invention abroad “to the extent permitted in section 104.” Section 104 is repealed by the 2011 Act, is not extended, and evidently can no longer permit proofs of any extent under § 102(g)(1). It is thus possible that the courts will hold that foreign proofs of invention are not admissible in post-Act interferences. If so, the scope of § 102(g) will effectively be limited to current § 102(g)(2), which restricts interferences to proof that a prior inventor made the invention in the US.
Current § 135(a) requires that the Board of Patent Appeals and Interferences “shall determine questions of priority of the inventions and may determine questions of patentability.” It seems doubtful that the new Patent Trial and Appeal Board will be enthusiastic about continuing to decide questions of patentability in post-Act interferences, providing that it has jurisdiction to decide interferences that arise after the effective date. To the extent that interferences remain a viable alternative for challenging patent validity on bases other than priority of invention, interferences will have certain advantages over the new post-grant opposition procedures, including the lack of estoppel in district court litigation.
These comments are at most speculative, until the USPTO issues regulations governing the treatment of interferences under the America Invents Act, and the courts definitively construe the uncodified interference provisions.
The relationship between post-Act interferences and Post-Grant Review will be considered in a subsequent post.
A 2-Session Course by Sughrue Mion, PLLC
IP WEEK 2011/Brussels, December 7 and 8
The new America Invents Act will arm patent challengers with potent new weapons, both by greatly expanding prior art applicable to future patents, and more importantly, by providing new USPTO patent revocation proceedings. One of the most significant aspects of this Act is the creation, for the first time in U.S. patent law, of effective inter-partes post-grant procedures. Oppositions in the USPTO will provide an alternative, and much more rapid, administrative forum that bypasses the courts and is intended to provide final administrative resolution of many validity questions while avoiding the delay, uncertainty, and expense of district court litigation.
Part 1 of this two-part course will provide an introduction and overview of these new post-grant proceedings in the context of patent litigation. Part 2 will concentrate on more detailed strategic use of these proceedings in intellectual property management.
Apart from direct attacks on the validity of patent claims, the new proceedings will be valuable for their use in licensing negotiations, settlement of disputes, management of district court litigation, and limiting or avoiding infringement damages under the doctrine of intervening rights. Oppositions will be an important part of a comprehensive IP management strategy that includes, but is not limited to, litigation of patent invalidity issues.
The panoply of patent challenges created by the 2011 Act includes post-grant review; inter-partes review, which will replace existing inter-partes reexamination with a more streamlined procedure; and pre-grant derivation proceedings. These opposition procedures, in combination with existing ex parte reexamination, interferences, and new “supplemental” examination, will transform the practice of USPTO administrative litigation. Unlike existing reexamination proceedings, the new post-grant proceedings will be fully “inter-partes” and will frequently involve discovery, depositions of fact and expert witnesses, and an extensive motions practice in a trial conducted by an Administrative Patent Judge on an extremely short schedule. The procedures for conducting post-grant proceedings will be complex and unforgiving, and it will be critical for a patent owner to respond immediately to a post-grant petition by fashioning a comprehensive legal, factual, and procedural strategy to present an effective defense.
Post-grant practice in the USPTO will more closely resemble litigation in district courts, and this two-part course will provide an introduction to the expected procedures, including the heightened requirements of proof for initiating the proceedings, the compressed schedule for briefing and decision, and the limited opportunities for a patentee to amend or correct challenged claims. The statute ordinarily requires a final USPTO decision on issues of validity within one year, which will affect concurrent district court litigation stays, preliminary injunctions, and potential damages awards. The strategic uses of USPTO post-grant actions will be an important consideration in managing, or avoiding, extended district court proceedings. In many cases, patent litigation may effectively be divided into USPTO actions considering validity, and district court actions considering infringement and damages issues.
The complexity of the new opposition procedures will provide both strategic and tactical opportunities for petitioners, apart from direct invalidation of challenged patent claims. Unlike current reexamination, it will be possible for the parties to voluntarily settle an opposition at any time prior to the final written decision of the USPTO Patent Trial and Appeal Board. This ability significantly increases the leverage of patent challengers in negotiations with patent owners, and will encourage the use of the new proceedings as an instrument in licensing negotiations, or settlement of ongoing litigation, rather than simply a means of invalidating patent claims.
Even if an opposer does not succeed in invalidating all of the challenged claims, if the patentee is required to amend the claims during the proceeding, the statute provides that intervening rights will eliminate damages for infringement of the amended claims, prior to conclusion of the opposition. In more than 80% of inter partes reexaminations the challenged claims have been either canceled or amended, providing an additional incentive for infringement defendants to oppose patents in the USPTO, on a parallel path with concurrent district court litigation.
Among other advantages to defendants, the USPTO post-grant proceedings will involve a significantly lower burden of proving invalidity by a preponderance of the evidence, rather than “clear and convincing” proof in district court, and a broader construction of critical claim terms by the Patent Trial and Appeal Board, without the necessity of a district court claim construction hearing. Moreover, unlike district court judges and juries, the Administrative Patent Judges of the Patent Trial and Appeal Board are experts with years of experience in considering patentability issues, and are generally familiar with the patented technologies at issue.
Like current reexaminations, the new inter-partes review will be limited to questions of novelty and obviousness based on printed publications or patents. In post-grant review oppositions, however, the challenger can raise almost any ground of invalidity that could be presented in a district court action, including prior art, nonenablement, lack of written description or utility, and patent-ineligible subject matter, among other defenses. The opportunity will exist for an accused infringer to raise its contemplated invalidity defenses in the USPTO, as an alternative to an anticipatory district court declaratory judgment action or during the course of infringement litigation. However, if the USPTO ultimately determines that the challenged claims are patentable, and rejects the grounds of invalidity raised in an opposition, the consequences for the opposer will be severe. An adverse decision in a post-grant proceeding creates an estoppel that will prevent the challenger from asserting any ground of invalidity in district court litigation that was actually raised in the opposition, or that the petitioner “reasonably could have raised” in the USPTO proceeding. A failed post-grant review could thus result in forfeiture of almost every invalidity defense in a district court infringement action.
Part 2 of this course will provide an overview of the practical aspects of planning an effective and comprehensive USPTO opposition strategy, including the determination whether to seek inter partes review or post-grant opposition, in view of potential estoppel consequences and the strength of different invalidity defenses. It will also consider circumstances under which a derivation proceeding can restore patent rights to the original inventor, when a competitor claims subject matter that is misappropriated, and the opportunity for a patent owner to avoid charges of inequitable conduct by supplemental examination.
The new USPTO proceedings will alter the course of U.S. patent litigation, and it is essential for innovators and potential infringement defendants to be generally familiar with the advantages and disadvantages of U.S. opposition practice. This course will provide a comprehensive discussion of the new proceedings, with a specific focus on their practical and strategic uses in licensing, settlement, and litigation management.
The course will be presented by members of Sughrue Mion PLLC’s Post-Grant and Litigation Practice Groups:
Ken Burchfiel is a partner at Sughrue Mion, PLLC, with over 30 years’ experience conducting litigation in federal courts and complex USPTO inter partes interference proceedings, which are expected to provide a model for conduct of the new post-grant opposition and derivation actions. He is the moderator of the U.S. Patent Opposition Practice group at LinkedIn.
Raja Saliba is a partner at Sughrue Mion, PLLC with over 14 years’ experience in counseling and representing clients in litigation in federal district courts, the USPTO, and in appeals in the Federal Circuit and regional circuits. Mr. Saliba has represented litigation clients in a broad variety of the electrical and mechanical arts and has extensive experience in administrative litigation, including inter partes reexaminations.
A critical factor in the decision to initiate a post-grant review or inter partes review proceeding in the USPTO will be the estoppel consequences of a decision confirming the patentability of challenged claims. Following the general model of current inter partes reexamination, both new statutes provide that if a “final written decision” is issued by the USPTO, the petitioner may not assert in a patent action in district court or the ITC that the claim is invalid “on any ground that the petitioner raised or reasonably could have raised during that inter partes review.” §§ 315, 325.
The scope of estoppel in post-grant oppositions
The scope of estoppel resulting from an unsuccessful opposition will differ in inter partes review and post-grant review, because of the vastly different grounds of invalidity that can be asserted by a challenger. Inter partes review can be based “only on a ground that could be raised under section 102 or 103 and only on the basis of prior art consisting of patents or printed publications.” A petitioner should not be estopped from asserting invalidity in district court litigation on any other ground, including anticipation based on prior use or sale, or other statutory defenses. However, if the petitioner unsuccessfully asserts that a claim is anticipated by a published reference, the resulting estoppel would extend, for example, to obviousness in view of any other published reference, provided that the additional reference could reasonably have been raised during inter partes review.
In sharp contrast, post-grant review may assert “any ground that could be raised under paragraph (2) or (3) of section 282(b) (relating to invalidity of the patent or any claim).” In post-grant review, the opposer may maintain that a claim is invalid for lack of novelty on the basis of public use or sale, for obviousness, for lack of written description or enablement, lack of utility, or patent-ineligible subject matter. The breadth of subject matter that can be raised in post-grant review dictates a similarly broad scope of estoppel, which in many cases could result in forfeiture of most if not all potential litigation defenses, if the petitioner is unsuccessful on any of these grounds raised in the opposition. A notable exception is unenforceability of the patent, including inequitable conduct, which is not a ground that could be raised under the specified paragraphs of § 282(b).
These potentially severe consequences of an unsuccessful post-grant opposition are mitigated by two important factors. Estoppel results only from review that “results in a final written decision” of the Board, and most significantly, in distinction to current inter partes reexamination, an opposition will not necessarily result in a final USPTO decision. Instead, the parties to an opposition have the power to terminate the proceeding by a settlement agreement, and the statutes provide that if a settlement is reached, “no estoppel shall attach” on the basis of the institution of the opposition. §§ 317, 327. Interferences frequently end in settlement agreements that effectively share the market in the patented invention between the parties, and a serious patentability challenge that can be withdrawn by settlement provides significant leverage in negotiating a license.
When does estoppel arise? –the Federal Circuit’s decision in Bettcher v. Bunzl
Even if the Patent Trial and Appeal Board issues a final written decision confirming the patentability of challenged claims, a critical issue remains—when does the estoppel arise? If an adverse USPTO decision is appealed to the Federal Circuit during the course of concurrent district court litigation, is the defendant estopped from asserting other defenses that could have been raised in the opposition, when the appeal is pending?
This extremely important question was recently addressed by the Federal Circuit in the context of inter partes reexamination in
Bettcher v. Bunzl. After Bettcher filed suit, Bunzl requested inter partes reexamination and during the course of litigation, the examiner declined to find the claims unpatentable and issued a Right of Appeal Notice. The district court considered that the examiner had issued a “final determination” in the reexamination proceedings, and precluded Bunzl from relying on certain prior art references. Bunzl maintained that the reexamination decision was not “final” until the Federal Circuit decided the appeal from the USPTO action, and that no estoppel resulted in the copending district court action.
Considering this question of first impression, the Federal Circuit concluded that the estoppel provision of section 315 is triggered “not when examination is completed but only after all appeal rights have been exhausted.” This required the court to decide the meaning of “finally determined” in § 315(c) in the context of the statute, the related regulations and the legislative history. This estoppel provision states that an inter partes reexamination requester “is estopped from asserting at a later time, in any civil [patent] action, the invalidity of any claim finally determined to be valid and patentable, on any ground which the third-party requester raised or could have raised during the inter partes reexamination proceedings.”
Relying principally on the right of both parties to appeal the decision of the examiner or the Board, the court considered that “this implies that estoppel requires exhaustion of all appeal rights, including appeals to this court.” It thus concluded that § 316 “defines a determination of patentability to occur only after all appeals have terminated” and a reexamination certificate is issued. The Federal Circuit accordingly vacated the denial of Bunzl’s motion for a new trial on invalidity based on the excluded references, and remanded the case to the district court.
As illustrated by Bettcher, a defendant will not necessarily be estopped from raising additional defenses in an infringement action after an adverse USPTO decision in inter partes reexamination, until the Federal Circuit finally resolves the questions of patentability raised in that post-grant proceeding. If the defendant proves that the asserted claims are invalid on a ground that was not raised in the USPTO, prior to the issuance of a reexamination certificate, it appears that the claims could properly be held invalid by the district court in the absence of estoppel.
Whether the same reasoning will be applied to estoppel resulting from a Board decision in inter partes review or post grant review is not certain, but the 2011 Act similarly refers to a “final written decision” issued by the Board as the basis for a certificate issued by the USPTO when the time for appeal has expired or any appeal has terminated. §§ 318, 328. It would be anomalous to conclude that an immediate estoppel arises from the “final” decision of the Board in the new post-grant oppositions, prior to the ultimate resolution of the issue by the Federal Circuit.
Based on the court’s reasoning in Bettcher, the possibility of estoppel from an unsuccessful opposition challenge during concurrent litigation may not present an insurmountable obstacle to the assertion of additional defenses, even if those defenses could reasonably have been raised in post-grant review. This possibility will affect not just the decision whether to challenge claims in the USPTO during litigation, but also the timing of a post-grant opposition and the specific grounds of invalidity that are raised in each proceeding.
The new PTO post-grant oppositions will not replace district court litigation, and will not be suitable in every action, but they will often be effectively used by generics as parallel, auxiliary proceedings in ANDA litigation. A paragraph IV first filer will not be able to avoid litigation by filing an opposition, but can advantageously use a concurrent PTO proceeding in a number of creative ways, procedurally and substantively, particularly in cases involving multiple first paragraph IV filers. I plan to explore these strategy issues in detail in future posts.
The 180-day exclusivity granted to successful paragraph IV first filers and 30-month stay of FDA approval available to patent owners are the engines driving ANDA litigation, and generic manufacturers may well benefit from the new post-grant proceedings with respect to both. An ANDA first paragraph IV filer who is sued can raise its prior art defenses in the PTO at a very early stage of the litigation (or even before filing its paragraph IV), and can reasonably expect to have a final administrative determination (or a Federal Circuit decision) before the close of discovery in many district courts, at a fraction of the litigation cost.
If the asserted claims are found invalid, they will be canceled from the patent, and the district court will enter judgment in favor of the defendant. Under these circumstances, the first filer will obtain 180-day exclusivity, because it has successfully maintained its paragraph IV challenge. If the district court enters judgment of invalidity prior to the 30-month stay date, the FDA can approve the ANDA without delay.
The estoppel effects of the post-grant proceedings will be a critical consideration in determining an effective strategy, but the estoppel effects of inter partes review are limited. Inter-partes review can only be based on printed publication and patent prior art, so the estoppel consequences of an adverse PTO decision would be limited to certain novelty or obviousness defenses. If an ANDA applicant is not able to establish that asserted claims are anticipated or obvious at the PTO, with the benefit of a favorable preponderance of the evidence burden, and the broadest reasonable construction of the claims, how likely is it that the generic will prevail on the same grounds in district court? How much will it cost to find out, over the course of discovery, Markman proceedings, and at least summary judgment?
The latest PTO data on inter partes reexamination state that of all requests filed, 71% were known to be in litigation. Almost all of the requests were granted (95%) and among all of the inter partes reexamination certificates issued, only 13% confirmed all of the challenged claims. In 44% of the actions, all claims were canceled, and in 43% the original claims were narrowed in the proceedings. By contrast, in general patent infringement litigation (not limited to ANDA cases) over the last 6 years, patent claims were sustained in about 60% of decided cases involving anticipation and obviousness defenses. By any measure, the PTO is a favorable forum for defendants compared with district courts, for patents that are involved in concurrent litigation and inter partes reexamination proceedings.
Post-grant review can be based on almost any invalidity argument that could be raised in district court, so the estoppel consequences of an adverse final decision would be severe. In each case it will be essential to consider the likelihood of prevailing on the defendant’s one or two best defenses in the PTO, versus the probability of success on other potentially barred defenses in district court, based on such factors as the importance of broad discovery and the general likelihood of prevailing on specific defenses. Once again, if the challenger is not able to prevail on its best defense in the PTO, it would be hazardous to expect success on secondary defenses at trial. Based on my experience in interferences, I would not expect most post-grant proceedings to proceed to final decision, and without a final adverse decision, there is no estoppel on any ground.
The Future of ANDA Litigation under the America Invents Act– Will the Balance Shift to Favor Generics?
The newly enacted America Invents Act will result in the most radical changes to U.S. patent law in 60 years, replacing historic novelty standards with a worldwide absolute novelty requirement, subject only to an illusory “grace” period. The new statute will arm patent challengers with potent new weapons, both by greatly expanding prior art applicable to future patents, and more importantly, by providing new USPTO pre-and post-grant administrative procedures to revoke existing patents or block the issuance of new applications. One of the most significant aspects of this Act is the creation, for the first time in U.S. patent law, of effective inter-partes patent revocation procedures, which are intended to complement district court invalidity challenges by providing an alternative, and much more rapid, administrative forum that bypasses the courts and is intended to provide final administrative resolution of validity questions within one year.
For generic drug manufacturers who file ANDAs with Paragraph IV certifications and face immediate infringement actions, these new post-grant proceedings will provide effective avenues to defend preemptively, and decisively, against innovator actions. As a result, branded manufacturers with Orange Book listed patents will face new and unfamiliar validity challenges, which may be initiated during FDA exclusivity periods, requiring an in-depth understanding of the new procedures in order to protect their interests.
Historically, the district courts have been the principal venue for invalidating patents in the U.S., but only for defendants already involved in an infringement lawsuit or under the imminent threat of litigation. In order for a generic drug maker to enter the market before the expiration of a patent covering an FDA-approved drug or method of treatment, the generic manufacturer must file an ANDA and a Paragraph IV certification, alleging that any patent listed in the Orange Book is invalid or will not be infringed. Typically, a Paragraph IV certification is followed by an infringement action, which results in an automatic 30-month stay of approval of the ANDA by the FDA. Resolution of validity challenges presented in the Paragraph IV notice is typically delayed by fact and expert discovery, and only occurs after trial or occasionally by summary judgment. The unfavorable legal presumptions, costs and delays of litigation and FDA approval, and uncertainty of district court litigation and appeal, have strongly favored branded manufacturers in defending extremely valuable markets protected by a small number of critical and extremely valuable patents.
This balance will be shifted by the panoply of patent challenges created by the new Act, which include post-grant review; inter-partes review, which will replace existing inter-partes reexamination with a more streamlined procedure; and derivation proceedings. The strategic use of the new procedures, in combination with existing ex parte reexamination, interferences, will transform the landscape of both USPTO administrative and district court litigation. Unlike existing reexamination proceedings, the new post-grant proceedings will be fully “inter-partes” and will frequently involve discovery, depositions of fact and expert witnesses, and an extensive motions practice in a trial conducted by an Administrative Patent Judge on an extremely short schedule.
Like current reexaminations, the new inter-partes review will be limited to questions of novelty and obviousness based on printed publications or patents. In post-grant review oppositions, however, the challenger can raise any ground of invalidity that could be presented in a district court ANDA action, including prior art, nonenablement, lack of written description, double patenting, and utility, among other defenses. The possibility will now exist for an ANDA filer to raise its contemplated Paragraph IV defenses in the USPTO, either before filing the ANDA or during the course of litigation, and obtain a final decision that could invalidate the asserted claims within one year after the proceeding is initiated.
Among other advantages to generics, the USPTO post-grant proceedings will involve a significantly lower burden of proving invalidity by a preponderance of the evidence, rather than “clear and convincing” proof in district court, and a significantly broader construction of critical claim terms by the Patent Trial and Appeal Board, without the necessity of a district court Markman hearing. Moreover, unlike district court judges, the Administrative Patent Judges of the Patent Trial and Appeal Board are experts with years of experience in considering patentability issues, and are generally familiar with the patented technologies at issue. These advantages of the new post-grant proceedings must be balanced against the estoppel consequences of an adverse USPTO decision, which can result in the loss of some or all defenses that could be raised in district court.
These substantive and procedural advantages of the new post-grant proceedings will enable patent challengers to raise invalidity defenses far more effectively in the USPTO, and to obtain a final decision canceling invalid patent claims prior to district court consideration of the same issues. It is likely that patent litigation will come to involve concurrent but separate proceedings in district court and the USPTO, and the new post-grant procedures will govern district court litigation strategies, including stays and preliminary injunctions, which are specifically addressed in the Act.
The Act contains other specific provisions that apply only to ANDA litigation, that will significantly modify existing Paragraph IV strategies based on inequitable conduct, by restricting the patent owner’s ability to “cure” inequitable conduct by submitting withheld information in a “supplemental examination” proceeding after patent issuance.
Whether used preemptively or in response to an infringement action, there is no doubt that inter partes review and post-grant review will prove to be effective and cost-efficient avenues for challenging Orange Book-listed innovator patents. The procedures for conducting post-grant proceedings will be complex and unforgiving, and it will be critical for an innovator to respond immediately to a post-grant petition by fashioning a comprehensive legal, factual, and procedural strategy to present an effective defense.
The new statute is likely to transform the conduct of ANDA litigation, and it is essential for both generic and branded manufacturers to become familiar with the contours of the new post-grant procedures, as a critical element both of ANDA filing and product life cycle management.
The 2011 America Invents Act radically revises the U.S. system of post-grant patent review, by providing 4 new post-grant opposition proceedings in addition to existing ex parte reexamination. The strategic use of interrelated post-grant proceedings will provide complex and rapid avenues for challenging the validity of important U.S. patents, and create a specialist bar of post-grant patent practitioners. The new derivation, post-grant review, and inter partes review procedures will be adversarial, and will often require deposition testimony and cross-examination of witnesses and experts, as under existing interference practice.
Three mantras of the U.S. patent reform movement have been (1) that post-grant opposition proceedings must provide an effective vehicle for weeding out invalid patents; (2) that the “first-to-invent” interference system must end; and (3) that a first-to-invent derivation system must remain under the guise of a “first filer to invent” regime.
Broadly speaking, the 2011 Act proposes to realize these goals by adopting a new post-grant review proceeding and revising existing inter-partes reexamination to create an “inter partes review.” The bill retains existing ex parte reexamination, which can be invoked as an alternative to the more complex inter-partes review proceeding. Interferences will eventually end, but a new “derivation” proceeding retains many of their basic features, requiring a priority of invention determination if the first to file a patent application derived the claimed invention from another, prior inventor.
Under the elaborate system established by the Act, the U.S. will have 6 different procedures for post-grant opposition of issued patents (derivation and post-grant review proceedings, inter partes review, ex parte reexamination, business method patent review, and interferences), as well as a new pre-grant “protest” procedure. As generally shown in the following chart, multiple post-grant opposition proceedings could be copending, although inter partes review can only be sought after the 9-month window for requesting post-grant review, or the termination of a post-grant review proceeding.
The most important new opposition procedures are post-grant review, inter-partes review, and derivation.
The new law permits multiple post-grant review proceedings, which can be initiated up to 9 months after the date of patent grant. The scope of post-grant review is not limited to prior art patents or publications, but instead may be based on any ground of invalidity that could be raised in district court litigation, including lack of written description, nonenablement, or patent-ineligible subject matter. If post-grant review is initiated after a 2-month period for the patent owner’s response to the petition and a 3-month period for USPTO consideration, the USPTO has 12 months to complete review (which can be extended to 18 months in “exceptional” circumstances). A final USPTO decision on validity could issue within about 17 months of patent grant.
An inter partes review can first be requested 9 months after patent grant, unless a post-grant review is pending. If so, the request for inter partes review can only be filed upon termination of the post-grant review. After a request for inter partes review is filed, the patent owner has a period to respond, and the USPTO has 3 months to consider the request, and if a proceeding is initiated, 12 additional months to reach a final decision (extended to 18 months in “exceptional” cases). A final USPTO decision could issue within about 2 years of patent grant.
Derivation proceedings must normally be requested within 1 year of initial publication of a patent application, but PTO consideration may be deferred until after a final decision in a post-grant or inter-partes review. Any number of ex parte reexamination requests may also be filed at any time after a patent issues.
In addition to the new patent opposition proceedings, the Act establishes a new post-grant “supplemental examination” that provides a way for patent owners to “cure” inequitable conduct by submitting information concealed from the USPTO during original examination. Ex parte reexamination and inter partes review proceedings are limited to consideration of prior art patents or publications, but a supplemental examination may consider any “information” submitted by the requestor.
The strategic ability to challenge issued U.S. patents is vastly expanded by the multiple opposition procedures created by the 2011 Act, particularly in view of the very short period permitted for a final USPTO decision, and statutory limitations on the patentee’s ability to amend or add claims during the proceedings. These advantages of the opposer are countered by severe estoppel consequences that follow an adverse USPTO decision upholding the validity of the challenged claims.
Although the contours of opposition practice will not be established for several years, it is clear that the new USPTO proceedings will provide an efficient parallel path for district court defendants to seek early resolution of invalidity contentions, in relatively inexpensive proceedings conducted by Administrative Patent Judges who are familiar both with patent law and the involved technologies. The 2011 Act is likely to transform patent infringement litigation, by diverting invalidity defenses to a forum more favorable for defendants.