Post Grant Challenges:
Strategy and Considerations
after the
America Invents Act of 2011
IP Law & Management Institute
November 7, 2011
Justin J. Oliver
FITZPATRICK, CELLA, HARPER & SCINTO
975 F Street, N.W.
Washington, DC 20004-1462
Michael K. O’Neill
FITZPATRICK, CELLA, HARPER & SCINTO
650 Town Center Drive, Suite 1600
Costa Mesa, CA 92626-7130
The Leahy-Smith America Invents Act of 2011
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Topics
 AIA’s changes to post-grant challenges
– What stays the same and what is new?
 Practice and procedure
– What do we know (thus far) about the operation of the new
proceedings?
 Strategies and considerations
– How will post-grant practice change in general?
– How do the changes help/hurt challengers?
– How should in-house counsel plan for the changes?
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Changes to Post-Grant Challenges
Before:
Transition:
After:

Ex parte reexam


Ex parte reexam

Inter partes reexam

Post grant review
Ex parte reexam (virtually
unchanged)

Inter partes reexam
– Transitional
business methods
program
– Will be phased out in
1 year
– Change of SNQ to
“reasonable
likelihood”

Inter partes review

Third party submission
Post grant review – new

– Business method
patents
– All other patents
Inter partes review – new

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Changes to Post-Grant Challenges
 Immediate Changes
– Change in standard for inter partes reexamination
 Substantial new question of patentability is now “reasonable
likelihood that the petitioner would prevail with respect to at
least 1 of the claims challenged.”
 September 16, 2012
– Post-Grant Review
 Transitional business method program
 Interferences
– Inter Partes Review – all patents
– End of inter partes reexamination
– Third Party Submission of Prior Art
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Changes to Post-Grant Challenges
 March 16, 2013
– Post-Grant Review
 For non-business method applications having an effective filing
date on or after this date
• Keep in mind that applications with earlier effective filing
dates are not eligible for Post-Grant Review
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Topics
 AIA’s changes to post-grant challenges
– What stays the same and what is new?
 Practice and procedure
– What do we know (thus far) about the operation of the new
proceedings?
 Strategies and considerations
– How will post-grant practice change in general?
– How do the changes help/hurt challengers?
– How should in-house counsel plan for the changes?
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Practice and Procedure
 Post-Grant Review Features
– Transitional Business Method Patents Program
 Inter Partes Review Features
 Common Features
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Practice and Procedure – Post-Grant Review
 Timing
– Petition must be filed not later than 9 months from date of grant of
patent (or broadening reissue)
 Threshold
– “that it is more likely than not that at least 1 of the claims challenged
in the petition is unpatentable”; or
– there is a “showing that the petition raises a novel or unsettled legal
question that is important to other patents or patent applications”
 Scope
– Arguments under §§ 101, 102, 103, and 112 (but not best mode)
 Applicability
– Effective September 16, 2012
– Applies to patents having a claim with an effective filing date after
March 16, 2013
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Practice and Procedure – Post-Grant Review
 Transitional Program for Covered Business Method Patents
– Allows for Post-Grant Review of business method patents after
September 16, 2012
– Features unique to program:
 Must be sued or charged with infringement
 Applicable to all business method patents, regardless of filing
date
 Estoppel only for grounds actually raised
 § 102(a) art
• If not “by another” must be more than a year before filing
date
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Practice and Procedure – Inter Partes Review
 Timing
– Petition can be filed after 9 months from date of grant or after
termination of a Post-Grant Review (includes broadening reissue)
 Threshold
– There is “a reasonable likelihood that petitioner would prevail with
respect to at least 1 claim of the claims”
 Scope
– Arguments under §§ 102 and 103, based on patents and printed
publications (same as inter partes reexam)
 Applicability
– Effective September 16, 2012
– Applies to all patents (replaces inter partes reexamination)
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Practice and Procedure – Common Features
 Initial Determination
– Petition filed by challenger
– Patent owner may file response
– USPTO issues decision on petition within 3 months of Patent
Owner response (or deadline for response)
 Not appealable
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Practice and Procedure – Common Features
 Conduct During Review
– Before panel of judges at the Board
 Removes Examiners from process
– Limited discovery
– Patent owner may amend the patent to:
(1) Cancel a challenged claim; or
(2) Propose a reasonable number of substitute claims
 Similar to EP Opposition practice, and cuts down on new claim
binges common in current inter partes practice
– Each side will have chance to file comments and request an oral
hearing
– Final determination to issue within 1 year
 USPTO may extend deadline by 6 months for good cause
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Practice and Procedure – Common Features
 Settlement
– Joint request for termination with respect to a Petitioner who is
settling
 Terminated with respect to that Petitioner unless the USPTO
has decided the merits
– USPTO might or might not terminate the proceedings
 If no Petitioner remains USPTO may still proceed to a final
written decision
– No estoppel attaches with respect to a terminated Petitioner
– Settlement must be in writing and made of record
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Practice and Procedure – Common Features
 Estoppel
– If a review results in a final decision by the Board, the petitioner
may not challenge the claim before the USPTO or court based on
any ground the petitioner raised or reasonably could have raised
– Changes
 “Reasonably” could have raised
 Attaches with Board decision, as opposed to final appeal
– Estoppel does not attach in EP oppositions – still a big difference
– Common (and unresolved) concerns:
 That new art will be uncovered during discovery and trial prep
 That post grant challenges will tie client’s hand with respect to
art turned up during discovery, but after start of a review
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Practice and Procedure – Common Features
 Intervening Rights
– Standard:
 Any amended or new claim shall have the same effect as that
for reissued patents with respect to the right of any person who,
before the issuance of the certificate:
• made, purchased, or used within the United States anything
patented by the amended or new claim,
• imported into the United States anything patented by the
amended or new claim, or
• made substantial preparation therefor
 Amended claims should eliminate past damages, even if new/amended
claim still covers accused device/process
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Comparison
Ex parte
Inter partes
Post-grant review
reexamination reexamination
Inter partes
review
Transitional postgrant review for
business methods
Timing
Anytime postissuance
Anytime postissuance
Within 9 months from grant (but
before challenger files a lawsuit)
After 9 months
from grant (but
before
challenger files a
lawsuit)
Only after
challenger has
been sued for or
charged with
infringement
Eligibility
Any patent
Any patent
Patent filed under FITF
- OR Dismissed interference
- OR Business method patent
Any patent
Any business
method patent
Threshold
SNQ
Reasonable
likelihood that
the requester
would prevail
More likely than not that a claim is
unpatentable
- OR novel or unsettled legal question
Reasonable
likelihood that
the requester
would prevail
Same as PostGrant Review
Basis
Patents or
printed
publications
Patents or
printed
publications
Any ground that could be raised in Patents or
litigation under 35 USC
printed
§ 282(b)(2) or (3) (including §§
publications
101, 102, 103, 112)
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Same as PostGrant Review, but
with limitations to
§ 102(a) of
current statute
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Comparison - continued
Ex parte
reexamination
Inter partes
reexamination
Post-grant review
Inter partes review
Transitional postgrant review for
business methods
Anonymity
Yes
No
No
No
No
Interviews
Yes
No
No
No
No
Discovery
None
None
Limited
Limited
Limited
Time Limit
on USPTO
None (“special
dispatch”)
None (“special
dispatch”)
One year
(extendable to 18
months)
One year
(extendable to 18
months)
One year
(extendable to 18
months)
Early
termination
No
Possible
Joint request
(specific to
petitioner); any
agreement must be
submitted
Joint request
(specific to
petitioner); any
agreement must
be submitted
Joint request
(specific to
petitioner); any
agreement must
be submitted
Estoppel
None
Any ground
raised or that
could have
been raised
Any ground raised
or reasonably could
have been raised,
unless settled
Any ground raised
or reasonably
could have been
raised, unless
settled
Only grounds
actually raised
Intervening
rights
Yes
Yes
Yes
Yes
Yes
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Topics
 AIA’s changes to post-grant challenges
– What stays the same and what is new?
 Practice and procedure
– What do we know (thus far) about the operation of the new
proceedings?
 Strategies and considerations
– How will post-grant practice change in general?
– How do the changes help/hurt challengers?
– How should in-house counsel plan for the changes?
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Strategies and Considerations – General Practice
 Practicing before the Board
– Will reviews operate, procedurally, like interferences?
 Experts and declarations become more critical
• Board prefers “evidence”
• Experts will now be subject to cross-examination
 Claim deluge to be reduced
– Current practice gives patent owners incentive to submit numerous
new claims during reexaminations
 “reasonable number” of “substitute” claims changes that
 Cost
– Declarations and cross-examinations increase cost
– Removal of Central Reexam Unit layer reduces cost
– Shortened period likely means no multiple non-final actions
– Fewer claims, lower cost
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Strategies and Considerations – Tactical Considerations
 New Threshold
– Higher than former threshold of “substantial new question” (SNQ)
 “reasonable likelihood” for inter partes review/reexam
 “more likely than not” for post-grant review
– 95% of inter partes requests granted under SNQ threshold
 Explicit intent of Congress to cut back on that number
– Will work against challengers
– Unlike EP Opposition practice
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Strategies and Considerations – Tactical Considerations
 New Threshold (continued)
– Will the higher threshold matter in the overall analysis?
 Real issue is likelihood of invalidating claims, which may or may
not change
 Even if odds change, will they be better than in district court?
• USPTO is typically more receptive to § 103 rejections
• USPTO uses broader claim interpretation and de novo
review
– Expected changes with new threshold
 Lower chance of appeal to Federal Circuit
• Can still get there through district court, but uphill battle
 First action allowances will likely go away
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Strategies and Considerations – Tactical Considerations
 New Grounds for Invalidity Under Post-Grant Review
– “any ground that could be raised under paragraph (2) or (3) of
section 282(b)”
 §§ 102 and 103
• Beyond printed publications
 § 101
• Most useful in business method and biotech patents
• Quicker (and cheaper) route to Federal Circuit
• No longer have to wait for litigation or threat of litigation
 § 112
• Indefiniteness
• Lack of written description
• Enablement
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Strategies and Considerations – Tactical Considerations
 Streamlined Process
– Current inter partes reexam takes too long
 If a stay is not granted, litigation is likely to finish before reexam
• This renders the reexam is of little use, but an added
expense
 Long timeline was likely to make more courts deny stays
– New procedures
 Direct to Board
 Decision in 1 -1.5 years
 Result:
• Now more attractive option when sued in a plaintiff friendly
jurisdiction
• Better argument for stay
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Strategies and Considerations – Tactical Considerations
 Estoppel
– Not significantly changed relative to current inter partes reexams
 Any ground that the petitioner raised or “reasonably” could have
raised
• Available or known to you?
– Different than European opposition practice
– Common concern:
 Later discovered prior art (e.g., discovery)
– Does not attach if petitioner settles and the challenge is terminated
with respect to the petitioner
– Bottom line:
 Must be confident that you have been diligent in your search for
the best prior art
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Strategies and Considerations – Tactical Considerations
 Overall question:
– Which avenue gives you the best chance of success for invalidation
 USPTO vs. district court
 Considerations
– Will overall success rates for post-grant challenges change?
– Are you in a plaintiff friendly venue?
– How deep is your knowledge of the prior art?
– How worried are you about new/amended claims?
– Cost?
 In general, the new law works in favor of challengers
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Strategies and Considerations – Looking Beyond Challenges
 Are you already tracking competitor patents?
– Will need to do so for Post-Grant Review
– Docketing systems will need to track deadlines for challenging
 Do you need to budget for reviews filed against your patents?
– 5% of European patents face opposition
– Will European numbers be a guide?
 Estoppel may continue to keep the U.S. numbers down
 European practice is unique in that it provides the last
opportunity to challenge in a single forum
 But, U.S. practice will combine Post-Grant Review and Inter
Partes Review, providing more opportunity for challenge than in
European practice
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Strategies and Considerations – Preference by Industry
Rate of Oppositions in EPO
Other fields
Mechanical engineering
Instruments
2007-2008
2005-2006
2003-2004
2000-2002
Electrical engineering
Chemistry
Overall Rate
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
Source: G. Scellato, et al., "Study on the Quality of the Patent System in Europe“, European Commission (March 2011)
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