Summary: The Patent Trial and Appeal Board (PTAB), reaffirmed by the Court of Appeals for the Federal Circuit (CAFC) and now the Supreme Court as well, carries on preventing frivolous lawsuits; options for stopping PTAB have nearly been exhausted and it shows

THERE'S nothing that the patent microcosm has not yet attempted in its war against PTAB. It tried to undermine the legitimacy of PTAB (to no avail), it attempted to slow PTAB down (also without success), and last year it even resorted to "scams" (misuse of immunity by using shell entities). The USPTO does not mind PTAB because it does not profit from litigation, unlike the patent microcosm. The USPTO just needs to grant good (valid) patents, unlike the EPO under Battistelli.

We've noticed a considerable decrease in criticisms of PTAB; after Oil States (basically the highest court cementing PTAB's role with only two dissenting Justices) it seems like the patent microcosm nearly gave up trying to tear PTAB down. Watchtroll, one of the main anti-PTAB sites, covered Altaire Pharm., Inc. v Paragon Bioteck, Inc. yesterday, but this wasn't even an anti-PTAB article. It feels as though they have learned to accept that PTAB is here to stay. This site's founder, Gene Quinn, even wrote something titled "Is the pro-patent community going to continue to lose every battle?"

The patent microcosm just can't stop lobbying Iancu after bullying/smearing his predecessor, Michelle Lee, showing that they're a collective of bullies rather than legal professionals. Watchtroll now calls the patent extremists (like him) the "pro-patent community" as if patent rationalists are "anti-patents" (they're not). Earlier this month Quinn maligned the Supreme Court, basically calling it "anti-patent".

As if anyone who isn't as extreme about patents (as Quinn is) must be "anti-patent". False dichotomies much? Binary conditions?

We must also note that Watchtroll have been covering a lot of copyright and trademark stuff rather than patents -- a rather profound difference (Watchtroll wrote about the Delaware litigation statistics, Vanda v West-Ward, another CAFC/PTAB case (Gen. Hosp. Corp. v Sienna Biopharmaceuticals, Inc.) but not much more). Have they given up? Is judge- and court-bashing all they have got left? Either way, let's look elsewhere.

A month before Oil States ("article was first published in Intellectual Property Magazine, March 2018") Joseph J. Raffetto, Arlene L. Chow and Corey Leggett (Hogan Lovells) wrote this article. It was finally made public (in full) just a few days ago. It had actually promoted the "scam" against PTAB:

Before projecting the future, it is important to reflect on the past. The US Patent Trial and Appeal Board (PTAB) in 2017 saw roughly the same number of filings as the two preceding years (ref. 1). The institution rate in 2017 remained similar as compared to 2015 and 2016 (ref. 2). The relatively consistent numbers for filings and institutions suggests that America Invents Act (AIA) proceedings have normalised and transitioned into a permanent fixture for the resolution of patent disputes.

[...]

Will ‘sovereign immunity’ continue to be a viable shield against PTAB proceedings?

Last September, Allergan and the Saint Regis Mohawk Tribe (tribe) entered into an agreement under which Allergan transferred certain patents directed to an eye treatment drug to the tribe, which in turn licensed the patents back to Allergan. The tribe then filed motions to dismiss IPRs relating to six of these patents, arguing that the parties’ arrangement shielded the patents from AIA challenges under the doctrine of sovereign immunity. This is not the first attempt to defend against IPRs on the basis of sovereign immunity. The PTAB dismissed multiple IPRs last year pursuant to sovereign immunity defences where the patent owners were state universities (ref. 4) But, this deal with the tribe appears to be the first example of transferring a patent portfolio to a sovereign entity seemingly for the purpose of defending against PTAB patent challenges.

The PTAB appears to be addressing sovereign immunity with increasing scrutiny as a result. It has not ruled on the tribe’s motions to dismiss. Instead, in light of the unique posture of the patent transfer, it has solicited amicus briefing from “any interested party” on the tribe’s sovereign immunity defence. Overall, 15 amicus briefs were submitted: seven sided with the tribe, favouring granting the motions to dismiss; eight favoured denying the motions. The time for filing amicus briefs has passed, and the PTAB is scheduled to render its decision this spring. Other recent orders from the PTAB suggest further scepticism of the defence. In December, for example, a PTAB panel denied a state university’s motion to dismiss an IPR based on a sovereign immunity defence (ref. 5) The PTAB decision acknowledged that state entities are generally immune from adjudicatory proceedings by federal agencies – like IPRs – but nevertheless found that the university had waived its immunity by filing a lawsuit in federal court for infringement of the same patents at issue in the IPR.

Allergan and the Saint Regis Mohawk Tribe have failed so badly and Oil States clearly undermines their 'case', making it futile.

It certainly feels like the patent microcosm is nowadays just hoping to slow PTAB down. IAM, the patent trolls' lobby, is planning to do another lobbying event/push dressed up as "free webinar on how SCOTUS and the USPTO are reshaping the PTAB landscape" (with stacked panels too, obviously).

Brad Y. Chin, Kevin R. Tamm, and Yeon J. Ko recently a few days ago published this article about SAS v Iancu and Oil States. As usual, as in this case as well, sites of patent maximalists try hard to distract from Oil States and focus on the vastly less important decision from the same day. To quote the parts about Oil States:

The Supreme Court issued decisions in the cases of Oil States v. Greene’s Energy and SAS v. Iancu, addressing the constitutionality of inter partes review (“IPR”) and determining whether the Patent Trial and Appeal Board (“PTAB”) must decide the patentability of all claims challenged by an IPR petitioner. The decisions held that IPR proceedings are constitutional and 35 U.S.C. €§ 318(a) requires the PTAB to issue a final written decision addressing the patentability of all claims challenged in the petition if instituted, putting an end to “partial institution” decisions. Although the Court has clarified the constitutionality of IPR, its decision in SAS will significantly impact the role of the petitioner, patent owner, and PTAB, creating less certainty for parties during IPR proceedings.

In Oil States, the Court held 7-2 that IPR, an adjudicative procedure before the PTAB at the United States Patent & Trademark Office (“USPTO”) to reconsider patentability of issued patents, does not violate Article III of the Constitution nor the Seventh Amendment. Oil States Energy Servs., LLC v. Greene’s Energy Grp., LLC, No. 16-712, slip op. (U.S. Apr. 24, 2018). Patent owner and petitioner Oil States sued Greene’s Energy in federal court for infringing Oil States’ patent, encompassing protections for wellhead equipment used in fracking. Greene’s Energy countersued asserting invalidity of the patent and also filed an IPR petition before the PTAB. Pending litigation, the PTAB, after institution, invalidated challenged claims in the patent. On appeal, the Federal Circuit upheld the constitutionality of IPR and ultimately affirmed the PTAB’s decision.

In addition to SAS v Iancu there's also Anacor Pharmaceuticals, Inc. v Iancu (another one of those "big pharma" cases). Covered by Donald Zuhn as well as others is this case of bogus patents being thrown away by both PTAB and (then) CAFC. The gist of it:

On Monday, the Federal Circuit affirmed the determination by the U.S. Patent and Trademark Office's Patent Trial and Appeal Board in an inter partes review that claim 6 of U.S. Patent No. 7,582,621 is unpatentable for obviousness. On appeal, Anacor Pharmaceuticals, Inc., the assignee of the '621 patent, challenged the Board's reasoning in finding claim 6 to be invalid.

[...]

On appeal, Anacor argued that: (1) the Board violated due process and the procedural requirements of the Administrative Procedure Act by failing to provide Anacor with adequate notice of, and an opportunity to respond to, the grounds of rejection ultimately adopted by the Board; (2) the Board improperly shifted the burden of proof by requiring the patent owner to disprove obviousness; and (3) the Board incorrectly concluded that the compounds of Austin are structurally similar to the compounds of Brehove. In an opinion authored by Judge Bryson, and joined by Judge Reyna and Judge Stoll, the Federal Circuit rejected Anacor's challenges to the Board's reasoning and upheld the Board's conclusion that claim 6 of the '621 patent is invalid for obviousness.

It's quite common for CAFC to agree with PTAB, especially on grounds such as these. Speaking of "mathematical analysis of information," CAFC recently threw away another such patent:

After considering the claims, the district court granted SAP’s motion for judgment on the pleadings — finding that the claimed process of “performing statistical analysis” is an ineligible abstract idea. In particular, the district court saw core of the claim as being directed toward an ineligible mathematical calculation. The field limitation (investment data) and generically claimed usable output (“a plot”) were insufficient to transmute the idea into a golden claim.

Had CAFC actually overturned PTAB, patent maximalists would be shouting from the rooftops again. One patent maximalist, "IP Hawk", celebrates very small 'wins'. "Nice to see Reatlime Data get a win at PTAB in a final decision. Opinion just filed," he wrote. So much for a 'win' (as he put it). Is that like one in a hundred? Dozens? It's also at a very low level (not even a court case).

Right now (in 2018) it is extremely hard to convince PTAB and the patent courts; they don't tolerate low-quality patent grants, which patent trolls have come to heavily rely on (Watchtroll is still denying that they exist and are a problem, having just called the very mention of them "political bullying").

As covered here earlier this month, PTAB and CAFC are nowadays tackling some of the worst patent trolls. The example of Personal Audio has been covered by the "big media" by now (e.g. "Supreme Court declines to hear “podcasting patent” case, handing win to EFF" in so-called 'liberal' press, not to mention the Conservative media's coverage). This had also been covered by Mike Masnick and Nazer of the EFF. Masnick's post recalls:

Going back many years now we've written about the company Personal Audio, which built itself up as a patent troll for digital audio. Back in 2011, it won a patent lawsuit against Apple over patents on playlists. In 2013, as podcasting was starting to take off, Personal Audio decided that one of its other patents actually covered podcasting as well and sued some top podcasters while threatening many others. EFF stepped in to use the valuable inter partes review process to seek to invalidate the patent, which worked. Though, in the process the company sought to intimidate EFF donors.

While all of this was happening, the company also realized that podcasters don't make any money, and figured out how to dump its lawsuits against individual podcasters... while still going after large companies like CBS.

And here's Ars Technica:

On Monday, the Supreme Court of the United States declined to hear the case of Personal Audio v. Electronic Frontier Foundation. In short, the case is all said and done.

As Ars reported in August 2017, the US Court of Appeals for the Federal Circuit affirmed the April 2015 inter partes review (IPR) ruling—a process that allows anyone to challenge a patent’s validity at the US Patent and Trademark Office.

"On Monday," Don't Bully My Business wrote, "SCOTUS dismissed a case involving an infamous patent troll. Click the link to read more about this success story!"

What needs to be remembered is this: those who keep attacking PTAB basically defend entities like Personal Audio, i.e. patent trolls. This is why we call sites like IP Watchdog and its founder "Watchtroll" (and have done that for many years). Also remember that PTAB is broadly supported by technology companies, both large and small; it's mostly opposed by law firms. ⬆