Software patents are being invalidated and even examiners (with feedback from PTAB) increasingly reject these before grant

Summary: The Patent Trial and Appeal Board (PTAB) maintains its good work which reforms the Office and elevates the patent bar (narrowing scope); the USPTO is expected to see a decrease in patents this year, not just a decrease in the number of patent lawsuits

THE USPTO's PTAB needs no introduction here. We already wrote hundreds of articles about it and we commended its work, which helps raise the bar for patent examiners and thus improves patent quality in the US, disqualifies frivolous patent lawsuits before they go too far (because of profound financial damage to innocent parties that are merely being accused or threatened), gives businesses some peace of mind, and gives law firms something better to aim for (other than getting a gazillion patents on everything under the Sun).

PTAB is loved. It's loved by those who actually create something.

PTAB is only (as far as we can see) hated by people who create nothing but lawsuits.

This post will focus on the latter group (the 'haters') because we feel the need to correct/rebut them.

Last week there was a decision in Knowles and it was discussed as follows: "Knowles Elecs v Cirrus Logic, FedCir 3/1/18; 2-1 majority affirms PTAB rejections in reexam for anticipation and lack of WD for proposed cls. Panel splits over impact of Circuit's 2011 MEMS decision construing same term in same patent in ITC proceeding. Newman dissents on this."

Newman dissents on a lot of stuff (we don't want to bash her over it) and Dennis Crouch uses her dissent for his typical PTAB bashing because he's not happy with the outcome (the PDF of this precedential decision was mentioned here). This is what Crouch wrote about PTAB:

The problem, for Judge Newman, is that a decision from the PTAB’s controlling court should control the actions of the PTAB and limit its power. For its part, the PTAB generally refuses to be bound by prior claim construction decisions by District Courts, but this is the first case where the PTAB has disregarded a prior interpretation by the Federal Circuit.

Although I began with Judge Newman’s opinion. Her opinion was in dissent, the Majority (Judges Wallach and Chen) avoided the question of whether the PTAB’s must follow Federal Circuit claim construction decisions. Rather, the majority held that the PTAB construction is in “accord with the definitions adopted in Mems Tech.” Based upon this claim construction, the majority agreed that the claims were anticipated by the proffered prior art.

Why did he begin with Newman’s opinion? That sort of bias is revealing, is it not?

Maybe the patent microcosm can just pretend to itself that only one judge exists and counts. The judge whom they like. The one they always/usually agree with. But that's not how this court works. Notice the rather misleading/unhelpful title as well: "PTAB Reconstruing Claims: Estoppel?"

Poor outline of the case at hand, no? Maybe if Newman had Mexican heritage, Crouch would use another inane cartoon (or meme) of hers.

Moving on a bit, PTAB was also mentioned by Gaston Kroub of Kroub, Silbersher & Kolmykov PLLC. It's not a coincidence that many proponents of software patents are also proponents of patent trolls, FRAND, SEP, the UPC etc. They are also opponents of patent quality control (something like PTAB). That's just what patent maximalists are like. "It is well-known that patents are more valuable in certain industries than others," Kroub said. "Whether it is because the eligibility of certain technology for patenting is in constant question — software, meet Alice — or because of the presence of standard-essential patents with their resultant FRAND obligations, in certain industries any given patent may not be very valuable. In contrast, industries like pharmaceuticals and medical devices, where a small set of patents can cover a blockbuster drug or device, are often thought of as having valuable patents. But recent developments have helped call this orthodoxy into question, particularly with respect to drug patents."

Scroll down a bit for the anti-PTAB screed, for example: "Merck was not the only pharmaceutical giant to face an adverse decision recently. In another long-anticipated ruling, the PTAB found that Allergan’s attempt to end run the IPR process by assigning patents covering its blockbuster eye treatment Restasis to an Indian tribe would not result in the termination of the nearly-final IPRs. While the specifics of the decision are interesting, and raise important questions about the PTAB’s authority to decide issues other than patent validity, there is no doubt that the result is a blow to Allergan’s attempts to shield its Restasis patents from an ultimate invalidity finding — especially since the district court presiding over the corresponding ANDA case involving those patents had already found them invalid. Whether the generic challenger is heartened enough by this latest ruling to launch at-risk (pending Allergan’s inevitable Federal Circuit appeals) is an open question. What is clear, however, is that drug companies like Allergan are willing to try everything to keep their valuable patents alive. Despite those efforts, even the most creative (desperate?) strategies will not go far when the quality of the underlying patents are not commensurate with their purported value."

We wrote about that case earlier today. PTAB receives plenty of hate for simply doing the right thing.

Doing the right thing seems to require courage these days because a whole bunch of patent law firms then resort to paid-for 'articles', racist memes, attacks on judges, endless efforts to cause scandals, and sometimes abusive letters. We've documented these over the years.

Crouch, a PTAB-hostile writer, is among those who are stressed to see patent sanity prevailing these days. See this new post which is at least suitably titled "Electronic Medical Records: Not Eligible" (obviously).

It's about PTAB and an examiner:

IMO’s CEO Frank Naeymi-Rad along with 11 others are listed as inventors of the company’s pending Application No. 13/622,934 – recently rejected on eligibility grounds. The claims are directed to a software system for “implementing a controlled vocabulary” within a longitudinal medical record. The examiner finally rejected all 14 claims for on eligibility grounds (withdrawing the obviousness rejection) — concluding that the claims are directed to the abstract idea of “providing healthcare by generating and processing medical records.”

On appeal, the PTAB sided with the examiner – holding that – at a high level of abstraction, the claims “can be characterized as collecting, storing, and organizing … and transmitting information.” Although the examiner acknowledges that the claims are novel and non-obvious, the PTAB still found no inventive concept.

As we shall show later, examiners now growingly reject software patents and PTAB almost always affirms their decision (to reject). It's an encouraging new trend. It's not entirely new, but it's gaining momentum.

It's worth noting that attacks on PTAB are running dry. We track these things pretty carefully and closely. All in all, the anti-PTAB lobbying sites have slowed down lately. These anti-PTAB tweets, personal attacks, blog posts and articles may have halved in number (compared to months ago). Watchtroll, which used to attack PTAB almost every day (sometimes more than once a day), has lots of totally off-topic stuff. Watchtroll was bashing PTAB using the recent Arendi case (that was two days ago), but those sorts of articles come out about twice a week now, not twice a day like they used to.

Anticipat, which was trying to sell products/services by badmouthing PTAB, is also changing its tone somewhat. It's softening.

Christopher Francis, writing for a law firm that loves bashing PTAB, is not happy about IPRs improving patent quality, but he too takes note of examiners' change of habit:

The Patent Trial & Appeal Board applied In Re: Smith Int’l to limit the broadest reasonable interpretation of claim language in Ex parte David Ben Yair (Appeal 2017-002190, decided Jan. 10, 2018). In this case, the claim is directed toward a composite suit including “an inner suit” and “an outer suit,” and the prior art discloses a single article of clothing including an outer layer and an inner layer. The PTAB agreed with the appellant that, based on the specification of the appealed application, the claims required two pieces of clothing. Based on this interpretation the PTAB reversed the prior art rejection.

[...]

This type of analysis by the PTAB begs the question of whether examiners are now required to identify support in the specification for their interpretation of claim terms. In any case, this decision is an example of a broad application of In re: Smith Int’l that could be useful when working with the examiners on BRI issues and when appealing based on an Examiner’s broad claim interpretation.

PTAB haters are still out there, ranting in ALL CAPS because PTAB cites €§ 101, but those are a lot more extreme than any of the above. They are connected to literal patent trolls. They are so 'fringe' that they even deny that professors are professors (when they do not agree with them). The trolls they are connected to deny that I have a Ph.D. and yet it's them who most habitually accuse PTAB of not caring about facts. The sheer hypocrisy. ⬆