THE USPTO is improving things with inter partes reviews (IPRs), so it's rather hard to imagine that anyone other than patent maximalists would wish to interfere.
Since the STRONGER Patents Act was introduced last year, it’s basically been a dead topic. Maybe that’s because the bill would gut the extremely successful inter partes review procedure and overturn more than a decade of Supreme Court precedent, crippling the ability of small and medium enterprises to develop products without fear. It would even make it legally beneficial to develop products anywhere other than the United States – a sort of R&D inversion scheme, enshrined in statute.
So, given that the STRONGER Patents Act will harm innovators and drive R&D overseas, why are Reps. Stivers (R-OH) and Foster (D-IL) planning to bring the STRONGER Patents Act back and introduce it in the House on Tuesday?
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Who Greenlighted This Sequel, Anyway?
So who’s supporting this bill, despite the harm to American innovation?
PhRMA, the pharmaceutical industry lobby. BIO, the biotech version of PhRMA. MDMA, the medical device version of PhRMA. I can’t imagine why they want to make it harder to invalidate the patents they use to keep generic companies off the market.
The Qualcomm-funded Innovation Alliance? InterDigital? Companies that make their money by licensing patents under threat of litigation? I’m sure Qualcomm and InterDigital would be unhappy if they could bar sales of iPhones entirely based on a patent related to a small part of a component that costs $20.
And there’s one other party lurking in the background—litigation finance. Third-party financial companies that underwrite patent litigation on spec, hoping to share in any damages awarded. Stivers and Foster aren’t on the Judiciary Committee, the House committee with jurisdiction over patent issues. They’re on House Financial Services.
And litigation finance companies making money by betting on patent litigation would like to make their business a less risky bet by making it harder to challenge patents and easier to extract royalties that exceed the value of the patent using the threat of injunctions.
A bill that will keep drug prices high by sending research overseas and increase everyone’s prices to reward financial speculators?
That’s a real-life horror story.
In its original decision, the PTAB cancelled claim 3 of Acceleron’s U.S. Patent No. 6,948,021 (inter alia). That holding was based upon an argument first presented by Dell at Oral Arguments (over Acceleron’s procedural objections). The Federal Circuit in 2016 vacated that first PTAB decision — “the Board denied Acceleron its procedural rights by relying in its decision on a factual assertion introduced into the proceeding only at oral argument, after Acceleron could meaningfully respond.”
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On appeal again, the Federal Circuit has now affirmed the validity finding — holding that the Board properly ignored Dell’s argument – even though the result is that we confirm the validity of a patent claim that is thought to be invalid. The problem for Dell is that the procedural rules are clear – “No new evidence or arguments may be presented at the Oral Arguments.” (Office Patent Trial Practice Guide, 77 Fed. Reg. 48,756 (Aug. 14, 2012)).
The primary holding here is that the PTAB was not required to allow for any re-briefing of the arguments and evidence.