Matt Szalach (left) and Monte Falcoff, patent attorneys with Harness Dickey in Troy, have seen an increase in the popularity of Inter Partes Review (IPR) proceedings over the past year.
By Sheila Pursglove
The popularity is due in large part to the fact that almost all — roughly 88 percent — are instituted by the Patent Trial and Appeal Board (PTAB), he explains.
“In other words, 88 percent of the time, the PTAB finds a patent challenger has sufficiently established there is a ‘reasonable likelihood’ that at least one challenged claim is un-patentable.”
Any patent issued before, on, or after September 16, 2012, is eligible for IPR review: whether from applications subject to “first-inventor-to-file” provisions or from the prior “first-to-invent” provision.
Proceedings take place before a three-person administrative judge panel within the United States Patent and Trademark Office (USPTO) and both sides - patent owner and challenger - participate in the briefing and arguments. Validity is the issue at play, not infringement or damages.
The burden of proof is lower when compared to district court litigation; and claim construction is potentially broader when compared to district court litigation, explains Szalach, who prepares and prosecutes patent applications in technical arts such as machine elements, automotive design, and electro-mechanical systems.
While a patent owner may file a motion to amend the claims of a patent during the IPR proceeding, such amendments are somewhat limited, Szalach says.
“For each challenged claim, a patent owner is generally only permitted to submit one proposed substitute claim and is not permitted to broaden the scope of the claims in any way. The lower burden of proof and potentially broader claim construction, combined with the limited ability of the patent owner to amend the claims of the patent, make IPR proceedings very attractive to a patent challenger.”
IPRs are a good blend of regular Patent Office prosecution and patent litigation — with strong elements of both, notes Monte Falcoff, another HDP principal.
“Our firm has brought and defended many of these new IPR proceedings over the past year, in conjunction with a Federal lawsuit, or as stand-alone actions,” he says. “Patent Office prosecution has its own set of very formalistic rules that takes years to master, and then the unique technical and legal aspects of patent interrogatories, document requests and depositions are added.”
The unique thing about the new IPR proceedings is that some discovery is allowed - albeit limited, he explains. If the patent challenger uses a technical expert or other person to submit a declaration as to the obviousness, or if the patentee uses an employee declaration of testing results or to prove commercial success of the invention, the other party can take the deposition of the declarant and use it before the USPTO judges.
According to Falcoff, the new IPR proceedings are now more like European Patent Office opposition proceedings but with the extra advantage of some narrowly focused discovery, which the EPO does not allow.
“EPO oppositions can be frustrating in that manner since challenger declarations are often difficult to refute even though the patentee suspects that only the challenger-favorable facts are being disclosed, yet there are likely unfavorable facts being hidden,” he says.
The key to making the new IPR proceedings work, Falcoff notes, is for the total legal fees and USPTO fees to be significantly lower than would the invalidity fight within a regular Federal district court.
For more information, visit www.uspto.gov.
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