Patent Review under the America Invents Act (AIA)
By Michael R. Hull - March 20, 2014
The America Invents Act (AIA) significantly changes the ways in which the validity of an issued patent can be challenged.
Defendants or accused infringers now have a choice of three different post-issuance proceedings for challenging the validity of a patent before the United States Patent & Trademark Office (USPTO). The three post-issuance proceedings are ex parte re- examination, inter partes review and post-grant review. Each of these three proceedings may be brought by a third party, such as a defendant, an accused infringer, competitor, etc. Further, patent owners may also initiate their own ex parte re-exam or a fourth post-issuance proceeding in the form of a supplemental examination. Each of these four post-issuance proceedings will be reviewed below.
Ex Parte Re-examination
An ex parte re-examination is a post-issuance proceeding brought before the USPTO by the patent owner, a third party or the USPTO itself. The purpose of an ex parte re-exam is to determine the validity of an issued US Patent. An ex parte re-exam may be filed at any time during the life of the patent plus six months after expiration of the patent. Ex parte re-exams are based only on patents and publications and the claims may be challenged as either lacking novelty (35 U.S.C. §102) or being obvious (35 U.S.C. §103). The party filing an ex parte re-examination must present a “substantial new question of patentability” regarding each claim that is being challenged (35 U.S.C. §303(a) and 312(a)). Further, the requestor must provide a detailed explanation of the “pertinency and manner of applying cited prior art to every claim for which re-examination is requested.” 35 U.S.C. §302. By limiting ex parte re-exams to only patents or printed publications, invalidating events such as public uses or sales of the claimed invention before the application filing date cannot be considered by the USPTO. Further, arguments brought under 35 U.S.C. §112, such as indefiniteness, lack of enablement or lack of compliance with the written description requirement may not be considered in ex parte re-exams.
If a third party files the request for re-exam and the request is granted, all proceedings that take place after the granting of the request involve only the patent owner and the USPTO. No further submissions or arguments may be presented by the third party. According to USPTO statistics, 92% of ex-parte re-examinations are granted. Further, unlike pre-AIA ex parte re-exams, current ex parte re-exams are now conducted by the Central Re-examination Unit (CRU), which is a group of experienced examiners. In contrast, prior to the AIA, the same examiner that allowed the patent could handle an ex parte re-exam of the same patent.
Upon completion of an ex parte re-exam, the USPTO will issue a certificate that may cancel any claim determined to be unpatentable, confirm any claim determined to be patentable and/or incorporate into the patent one or more claims amended during the ex parte re-exam. If an ex parte re-exam is filed sufficiently early during the course of a patent litigation and the re-exam request is granted, the court has the option to stay the litigation while the ex parte re-exam is carried out. The average pendency of an ex parte re-exam is about two years and about 11% of all ex parte re- examinations result in cancellation of all claims, about 23% result in confirmation of all claims and the remainder result in an amendment to at least one claim. While the patent owner has the right to appeal any cancelled claims, a third party requestor has no right to an appeal or judicial review of the USTPO final determination in an ex parte re-exam. Finally, unlike inter partes review and post-grant review proceedings, there is no estoppel effect of an ex parte re-exam. For example, a third party requests an ex parte re-exam based on one or more publications, and the USPTO denies the request or grants the request but issues a certificate confirming the patentability of all claims. If this occurs, the third party is not estopped or prevented from challenging the validity of the same patent, based upon the same publications in federal court.
Inter Partes Review
An inter partes review is one of the new proceedings created by the AIA and will be conducted by the Patent Trial and Appeal Board (PTAB), instead of the CRU. An inter partes review may only be brought by a third party against any patent issued after September 16, 2012 and more than nine months after the patent was issued. Patents that have been issued for less than nine months may be challenged in a post-grant review, which is discussed below. Alternatively, a petition for an inter partes review may be filed during a post-grant review.
Like an ex parte re-exam, an inter partes review may challenge the novelty (35 U.S.C. §102) or non-obviousness (35 U.S.C. §103) of at least one claim of the patent, but such a challenge can only be based upon patents and printed publications. However, unlike an ex parte re-exam which has a standard of a “substantial new question of patentability,” the standard for granting a petition for an inter partes review is a “reasonable likelihood that the third party petitioner will prevail on at least one claim.” Inter partes reviews are conducted before the PTAB which has newly created powers regarding discovery. The patent owner is entitled to three months of discovery, followed by three months of discovery by the petitioner, followed by another month of discovery for the patent owner. Once the petition is granted, the proceeding is supposed to be completed with a final written decision within 12 months.
Inter partes reviews do carry an important estoppel effect. The third party cannot challenge the patent on grounds that were raised or could have been raised in the inter partes review in subsequent federal court or proceedings before the International Trade Commission (ITC). Further, an inter partes review cannot be filed if a court case regarding the patent has pending for 12 months or longer. An inter partes review filed before a later-filed court case automatically stays the later-filed court case.
The AIA also created post-grant reviews. Post-grant reviews may only be filed by third parties against any patent with an effective filing date on or after March 16, 2013. The post-grant review is a proceeding conducted before the PTAB, which may consider any type of prior art or any grounds for invalidating the patent. Both the petitioner and the patent owner participate and both parties in interest are subject to an estoppel effect; the parties cannot subsequently challenge the patent in federal court or before the ITC on grounds that were raised or could have been raised during the post-grant review. Further, post-grant reviews cannot be filed if a federal court case regarding the patent is pending and any later-filed court cases are stayed, just like with inter partes reviews.
Finally, the AIA also created a fourth post-issuance proceeding referred to as a supplemental examination. Supplemental examinations can only be filed by the patent owner, before the patent expires. The basis for the filing may be any information relating to patentability such as improper disclosure, non-disclosure, “fraud” on the patent office, possible public sales, etc. The standard for granting a supplemental examination request is whether a substantial new question of patentability is presented. Supplemental examinations are conducted before an examiner, who might be the original examiner of the patent. Supplemental examinations also create an estoppel which prevents the patent from being held unenforceable in a court proceeding on the basis of conduct carried out during the original examination if such conduct was corrected during the supplemental examination.
Any decision to initiate a post issuance proceeding should be made only after a careful evaluation of the impact of the proceeding itself and the impact on any litigation, along with an analysis of the benefits, risks and costs of the proceeding. A brief summary of the four proceedings discussed above and the applicable filing fees are presented in the following table.
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