Brussels IP Week 2011 USPTO Oppositions Course, Dec. 7-8

November 17, 2011


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.