AIA Monitor

Today, April 9, is the last day to comment on the proposed new rules for proceedings before the USPTO Patent Trial and Appeal Board (PTAB).  See my previous post for further information, including the e-mail address for making submissions.

Comments to the USPTO regarding the proposed new rules for inter partes review (IPR), post-grant review (PGR), the transitional program for certain business method patents (TPCBMP) and derivation proceedings are due by midnight Eastern Standard Time tomorrow, April 10, 2012.  The following table provides links to each notice of proposed rule making and the corresponding e-mail addresses for submitting comments to the USPTO.

See the sidebars to the right of this post which provide links to (1) the proposed rules announced in each of the above NPRMs and (2) Section 6 of the AIA, which contains the statutory provisions to be implemented by the above proposed rules.  The proposed rules and statutory provisions have been reformatted to facilitate review.

According to proposed 37 CFR §§42.107(b) and 42.207(b), the patent owner has “no more than” two months within which it may respond to a petition for IPR and PGR. The expression “no more than” suggests that the PTAB will not grant extensions of time for just cause under 37 CFR §42.5(c)(2) of the proposed rules for practice before the PTAB.  This seems unduly harsh in view of the minimum of nine months during which the petitioner can prepare its petition, particularly for patentees who are lay persons or who require a translation to their native language.

The overall time frame for IPR, PGR and TPCBMP can have harsh consequences for patentees faced with an attack on nonobviousness based on a new reference or an attack for lack of enablement under PGR, when the testing required to establish unexpected results or enablement cannot be completed within the time frame of the proceedings through no fault of the patentee.  Examples include patents in which the invention addresses how to improve the stability of a composition during storage, reduce deterioration of a substance when exposed to the environment (exposure to the elements), influence plant growth (growing season), reduce fatigue in materials (fatigue testing), prevent disease (animal testing), etc., for which many thousands of patents are granted each year.  Even if the PTAB exceptionally grants a six month extension of the term for conducting IPR or PGR, the data may not be available in time to rely on it during the proceedings.

Such consequences would be made even worse if the USPTO maintains its proposal to impose a nonstatutory patentee estoppel under 37 CFR §42.73(d)(3) of the proposed rules for practice before the PTAB published in 77 Federal Register 6879 and discussed in the previous post.  According to that proposed rule, the patentee would be prevented from pursuing protection in a continuation or reissue application based on test results that could not be timely submitted during IPR or PGR.

Overall, the cost of the IPR, PGR and TPCBMP proceedings due to the complexity of the proceedings under the proposed rules may lead to settlements in a substantial number of cases.  Just as “patent trolls” have been criticized for using the cost of litigation as means for generating settlements based on weak claims of patent infringement, perhaps we will see the development of “opposition trolls” who use the cost of opposition in the US to force settlements for the sole benefit of the troll.