03.17.18

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The Patent Trial and Appeal Board (PTAB) Carries on Enforcing § 101, Invalidating Software Patents and Upsetting the Patent ‘Industry’ in the Process

Posted in America, Courtroom, Patents at 11:00 pm by Dr. Roy Schestowitz

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Oil States Energy Services, LLC v Greene’s Energy Group, LLC update

Summary: A quick report on where PTAB stands at the moment, some time ahead of the Oil States decision (soon to come from the US Supreme Court)

THE past 4 years have been historic; the US Supreme Court decided on Alice nearly 4 years ago and AIA had already come into effect, adding a sort of supervisory role for USPTO examiners. They were no longer able to issue patents with quite the same leeway (which they got accustomed to). With Inter Partes Reviews (IPRs) at PTAB we nowadays see a rise in activity whose net effect is reduction — not inflation — of patenting. Common sense would say that’s a Good Thing™, but for those who made a living from patent maximalism this is actually a nightmare. It forces them to make cuts.

A week ago the Financial Times (FT) said (behind paywall) that “patent “reform” during the Obama administration arguably went too far”. Remember that FT is paid by patent maximalists and trolls boosters like Battistelli. It also occasionally promotes UPC, bashes patent reform, and bashes PTAB etc. We gave many examples of that before.

Truth be said, not everyone is happy, but we need to study the motivation for that disdain and spot the pattern. It’s almost always the case that PTAB bashing comes from the litigation ‘industry’; PTAB helps reduce litigation, settling issues before they reach the court and typically by invalidating patents that would be a waste of courts’ time.

Here’s IAM, the patent troll’s lobby, with its latest attempt at PTAB bashing:

Patents in the biotechnology and organic chemistry, computer architecture, and e-commerce spaces are much more likely to survive the IPR process than those in other technology areas, new research has revealed. Semiconductor patents, on the other hand, fare the worst. What’s more, universities and small entities have a lower rate of success when compared to others.

Well noted the other day was the argument that “IPRs are more complete compared to litigation”. To quote the relevant paragraph in its entirety:

For example, they argue that IPRs are more complete compared to litigation, because litigation has selection effects both in what gets litigated and in settlement post-litigation. But IPRs suffer from the same problem. Notwithstanding some differences, there’s a high degree of matching between IPRs and litigation, and many petitions settle both before and after institution.

Anticipat, which is attempting to make a business out of PTAB hatred, keeps suggesting new ways to work around it [1, 2] and the other way suggested a way to compel PTAB to tolerate software patents. To quote:

In a recent decision, Ex parte Jang (March 1, 2018) (available at https://anticipat.com/research?id=104015), the Board reversed an Examiner’s Section 101 rejection. In so doing, the Board panel found that the claimed software invention was not directed to an abstract idea under step 1 of the Alice/Mayo framework. Interestingly, the Board analogized to a Federal Circuit decision that had been decided not six weeks prior.

We wrote about this before. What they neglect to say is, this isn’t an IPR and it doesn’t quite concern software. On another day they alluded to Section 103 and said: “It may be discouraging to an applicant to appeal all the way to a final decision only to see the rejection(s) be affirmed. The process can take years. Fortunately, there is a procedure that allows for such a decision to be reviewed by the same panel: request for rehearing. This procedure is at times successful, perhaps counter-intuitively.”

Then they jump back to Section 101 again: “As we have reported about a Section 101 rehearing getting granted, because of the makeup of the panel being the same as the original decision, intuition would suggest that these requests never get granted. However, they do happen. Plus there are no government fees to file a request for rehearing. So it doesn’t seem like a bad idea to add on a few more months to pursue this procedure, especially after going all the way to the final decision.”

Anticipat likes to cherry-pick and highlight exceptional cases to get across an impression which is misleading. In practice, under the criteria found in Section 101, software patents almost invariantly perish.

Unified Patents, according to its latest update, has once again demonstrated that the patent troll Dominion Harbor has worthless patents and it’s losing them one by one. The latest:

On March 16, 2018, the Patent Trial and Appeal Board (PTAB) instituted trial in an IPR filed by Unified against U.S. Patent 6,014,089 owned and asserted by First Class Monitoring, LLC, a Dominion Harbor subsidiary and a well-known NPE. The ’089 patent, directed to transmitting data via conventional SMS messages over a control channel of a personal communications system transmission protocol, has been asserted against various financial services companies such as Citigroup, Bank of America, USAA, JP Morgan, and PNC.

We are going to remain vigilant in the face of PTAB bashing. There’s an important decision coming soon (Oil States) and although we strongly doubt it’s going to change anything, one must never be too complacent/nonchalant. Just because software patents are in their deathbed at the moment (with enforcement via PTAB) doesn’t mean it will always remain that way.

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