Post-Issuance Proceedings Under the AIA Thomas F. Cotter Briggs and Morgan Professor of Law University of Minnesota Law School

Post-Issuance Proceedings: Overview Prior to the AIA, the U.S. Patent Act provided for ex parte and inter partes reexamination proceedings, and for third party submissions of certain types of prior art. Post-AIA, these types of proceedings continue to exist. Section 6 of the AIA makes some amendments, however. It also creates a new type of proceeding—a “post-grant review”—which is similar to “opposition” proceedings that already exist in other countries. In addition, § 18 of the AIA provides for special post- grant review of business method patents for a period of time. Section 12 provides for “supplemental examinations,” which may be of limited use, however, in light of recent case law limiting the inequitable conduct doctrine.

Pre-AIA Law: Submissions of prior art and ex parte reexaminations Both procedures introduced in Submission of prior art (35 U.S.C. § 301): –“Any person at any time may cite to the Office in writing prior art consisting of patents or printed publications which that person believes to have a bearing on the patentability of any claim of a particular patent....” Ex parte reexaminations (35 U.S.C. §§ ) –“Any person at any time may file a request for reexamination by the Office of any claim of a patent on the basis of any prior art cited under the provisions of section 301 of this title....” (§ 302) –“Within three months following the filing of a request for reexamination... the Director will determine whether a substantial new question of patentability affecting any claim of the patent concerned is raised by the request, with or without consideration of other patents or printed publications....” (§ 303(a)) –“If, in a determination made under the provisions of subsection 303(a) of this title, the Director finds that a substantial new question of patentability affecting any claim of a patent is raised, the determination will include an order for reexamination of the patent for resolution of the question....” (§ 304) –“After the times for filing the statement and reply provided for by section 304 of this title have expired, reexamination will be conducted according to the procedures established for initial examination under the provisions of sections 132 and 133 of this title....” (§ 305) –Patent owner is permitted to propose amendments and to add new claims, but may not enlarge the scope of the claims. (Id.)

Pre-AIA Law: inter partes reexaminations (35 U.S.C. §§ ) Introduced only in 1999, after analysis showed that ex parte reexaminations were not being widely used in part because of the limits on third party involvement in the process. Section 311(a): “Any third-party requester at any time may file a request for inter partes reexamination by the Office of a patent on the basis of any prior art cited under the provisions of section 301. “ Section 312(a): “[T]he Director shall determine whether a substantial new question of patentability affecting any claim of the patent concerned is raised by the request....” Section 313: “If... the Director finds that a substantial new question of patentability affecting a claim of a patent is raised, the determination shall include an order for inter partes reexamination of the patent for resolution of the question....” Section 314(a): “Except as otherwise provided in this section, reexamination shall be conducted according to the procedures established for initial examination under the provisions of sections 132 and 133.” Section 314(b)(2): “Each time that the patent owner files a response to an action on the merits from the Patent and Trademark Office, the third-party requester shall have one opportunity to file written comments addressing issues raised by the action of the Office or the patent owner's response thereto....” Third party requester also has a right to appeal and to participate in the patent owner’s appeal (§ 315(b)).

Pre-AIA Law: inter partes reexaminations (35 U.S.C. §§ ) Estoppel –“A third-party requester whose request for an inter partes reexamination results in an order under section 313 is estopped from asserting at a later time, in any civil action arising in whole or in part under [28 U.S.C. § 1338], the invalidity of any claim finally determined to be valid and patentable on any ground which the third-party requester raised or could have raised during the inter partes reexamination proceedings. This subsection does not prevent the assertion of invalidity based on newly discovered prior art unavailable to the third-party requester and the [USPTO] at the time of the inter partes reexamination proceedings.” ((§ 315(c)) –Section 4607 of the Optional Inter Partes Reexamination Procedure Act of 1999 also includes an estoppel provision that (for some reason) was never codified in Title 35, but which nevertheless has the force of law: “Any party who requests an inter partes reexamination... is estopped from challenging at a later time, in any civil action, any fact determined during the process of such reexamination, except with respect to a fact determination later proved to be erroneous based on information unavailable at the time of the inter partes reexamination decision.” In large part due to these estoppel rules, inter partes reexaminations have been rare. –Initially, the USPTO projected that 600 petitions would be filed annually by –In fact, from , only 53 (total) were filed. –See USPTO Report to Congress on Inter Partes Reexamination (2004) [hereinafter 2004 Report], available at

Post-AIA Law: submissions of prior art and ex parte reexaminations (effective 9/16/2012) Submission of prior art (35 U.S.C. § 301): –“Any person at any time may cite to the Office in writing (1) prior art consisting of patents or printed publications which that person believes to have a bearing on the patentability of any claim of a particular patent; or (2) statements of the patent owner filed in a proceeding before a Federal court or the Office in which the patent owner took a position on the scope of any claim of a particular patent.” (§ 301(a)) “A party that submits a written statement pursuant to subsection (a)(2) shall include any other documents, pleadings, or evidence from the proceeding in which the statement was filed that addresses the written statement.” (§ 301(c)) “A written statement submitted pursuant to subsection (a)(2), and additional information submitted pursuant to subsection (c), shall not be considered by the Office for any purpose other than to determine the proper meaning of a patent claim in a” reexamination or post-grant review. Ex parte reexaminations (35 U.S.C. §§ ): –No material changes, except that because any of the evidence referred to in § 301 can be considered in an ex parte reexamination, the universe of relevant evidence is now slightly larger than it was before. –“This addition will counteract the ability of patent owners to offer differing interpretations of prior art in different proceedings.... [T]he Committee does not intend these statements to be a basis for the institution of a reexamination proceeding. Reexaminations will continue to be available only on the basis of ‘patents or printed publications.’” H.R. Rep. No , at 46 (June 1, 2011).

Post-AIA Law: inter partes review With one exception noted below, these provisions also go into effect 9/16/2012, and will apply to any patents granted before, on, or after that date. See AIA § 6(c)(2)(A). “A petitioner in an inter partes review may request to cancel as unpatentable 1 or more claims of a patent only on a ground that could be raised under section 102 or 103 and only on the basis of prior art consisting of patents or printed publications.” (§ 311(b)) –Does not expand the type of prior art that may be considered from what it was prior to the AIA. The petition “shall be filed after the later of either... 9 months after the grant of a patent... or... if a post-grant review is instituted... the date of termination of such post-grant review.” ((§ 311(c)) –As we will see, post-grant reviews are to be initiated, if at all, within 9 months of issuance. –So the effect of this provision will be to require petitioners to wait until a post- grant review, if any, is completed before initiating an inter partes review. –Inter partes review will still be “appropriate for parties that have discovered prior art outside the time period to request review of the patent under Post-Grant Review.... [I]nter partes reexamination would become a more effective vehicle for addressing the fact that new relevant prior art patents and printed publications can very well surface at any time during a patent’s life.” 2004 Report, at 7.

Post-AIA Law: inter partes review The substantive standard for granting an inter partes reexamination has changed from “substantial new question of patentability” to “reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims challenged in the petition.” –This change will be embodied in a new section 314(a), effective 9/16/2012. –The new standard, however, applies immediately to any reexamination petitions filed on or after 9/16/2011, under “transitional” sections 312(a) and 313. –The new standard will make it “substantially harder to obtain inter partes review.” Mark A. Lemley, Things You Should Care About in the New Patent Statute, at 5 (Sept. 16, 2011), available at –See also H.R. Rep. No , at 47 (stating that the “threshold for initiating an inter partes review is elevated from ‘significant new question of patentability’—a standard that currently allows 95% of all requests to be granted—to a standard requiring petitioners to present information showing that their challenge has a reasonable likelihood of success”).

Post-AIA Law: inter partes review Amended § 315 sets forth the relation between inter partes review and other proceedings: –“An inter partes review may not be instituted if, before the date on which the petition for such a review is filed, the petitioner... filed a civil action challenging the validity of a claim of the patent.” (§ 315(a)(1)) –“If the petitioner... files a civil action challenging the validity of a claim of the patent on or after the date on which the petitioner files a petition for inter partes review of the patent, that civil action shall be automatically stayed until either (A) the patent owner moves the court to lift the stay; (B) the patent owner files a civil action or counterclaim alleging that the petitioner... has infringed the patent; or (C) the petitioner... moves the court to dismiss the civil action.” (§ 315(a)(2)) –An inter partes review may not be instituted if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner... is served with a complaint alleging infringement of the patent....” ((§ 315(b))

Post-AIA Law: inter partes review The estoppel effect, however, remains: –“The petitioner in an inter partes review... that results in a final written decision under section 318(a)... may not request or maintain a proceeding before the Office with respect to that claim on any ground that the petitioner raised or reasonably could have raised during that inter partes review.” –“The petitioner in an inter partes review... that results in a final written decision... may not assert either in a civil action arising in whole or in part under [28 U.S.C. § 1338] or section 337 of the Tariff Act of 1930 that the claim is invalid on any ground that the petitioner raised or reasonably could have raised during that inter partes review.” (§ 315(e)). See also id. § 317: “If the inter partes review is terminated [by party settlement] with respect to a petitioner under this section, no estoppel under section 315(e) shall attach to the petitioner...” “The Act converts inter partes reexamination from an examinational to an adjudicative proceeding.” H.R. Rep. No , at 46. For example: –Section 316(a) requires the director to prescribe regulations for, inter alia, discovery (including depositions), sanctions for abuse, and a right to an oral hearing. –Inter partes reexaminations will be conducted by the Patent Trial and Appeal Board (f/k/a Board of Patent Appeals and Interferences) (§ 316(c)). –The petitioner will have the burden of proving unpatentability by a preponderance of the evidence. (§ 316(e))

Post-grant reviews Section 321: –“Subject to the provisions of this chapter, a person who is not the owner of a patent may file with the Office a petition to institute a post-grant review of the patent. The Director shall establish, by regulation, fees to be paid by the person requesting the review....” (321(a)) –“A petitioner in a post-grant review may request to cancel as unpatentable 1 or more claims of a patent on any ground that could be raised under paragraph (2) or (3) of section 282(b) (relating to invalidity of the patent or any claim).” (321(b)) –‘‘A petition for a post-grant review may only be filed not later than the date that is 9 months after the date of the grant of the patent or of the issuance of a reissue patent (as the case may be).” Section 323: –‘‘If a post-grant review petition is filed under section 321, the patent owner shall have the right to file a preliminary response to the petition, within a time period set by the Director, that sets forth reasons why no post-grant review should be instituted based upon the failure of the petition to meet any requirement of this chapter.” Section 324: –“The Director may not authorize a post-grant review to be instituted unless the Director determines that the information presented in the petition filed under section 321, if such information is not rebutted, would demonstrate that it is more likely than not that at least 1 of the claims challenged in the petition is unpatentable.” (324(a))

Post-grant reviews Section 325: –As with inter partes reexaminations, a post-grant review is inappropriate if the petitioner has already filed a civil action challenging the validity of a claim of the patent; and automatically stays a civil action filed by the petitioner at some later time, subject to the same exceptions that apply with respect to inter partes reexaminations. –Does not appear to prevent a defendant in a civil action from both raising invalidity as a defense, however, and instituting an opposition (Lemley, supra, at 10). –Estoppel also applies to post-grant reviews under the same terms as it applies in inter partes reexamination (§§ 325(e), 327). Section 326: –As with inter partes reexaminations, the Director is to issue regulations by 9/16/2012, providing for discovery, right to an oral hearing, etc. (§ 326(a)). –PTAB to conduct post-grant reviews (§ 326(c)). –The petitioner will have the burden of proving unpatentability by a preponderance of the evidence (§ 326(e)).

Post-grant reviews These amendments all take effect as of 9/16/2012, but they will apply only to patents issued under the first-to-file standard that goes into effect 3/16/2013. So in effect there won’t be any post-grant reviews until sometime after 3/16/2013. Recall, however, that after 9/16/2012, inter partes reviews cannot be instituted until at the earliest 9 months after grant. Thus, during the transition to first-to-file, “neither inter partes reexam nor post-grant oppositions appear to be available during the first nine months of the patent term. That omission seems inadvertent, a result of the complex effective data provisions” (Lemley, supra, at 10).

Why post-grant reviews? Widely used elsewhere –See, e.g., EPC article 99 (providing that within 9 months of grant of a European patent, “any person may give notice to the [EPO] of opposition to the European patent granted”). Grounds include pretty much any reason that would preclude patentability (EPC art. 100). Opposition proceedings are adversarial-type proceedings, conducted before the EPO’s Opposition Division. –Oppositions are often viewed as a way of screening out invalid patents at an early stage and at relatively low cost, usually before any infringement litigation has commenced. –Oppositions are not the only way of screening out invalid patents, however. Although practice varies from country to country, countries that have oppositions may also permit third parties to file civil actions for patent invalidation after the time for filing an opposition has lapsed, and/or to file declaratory judgment actions, and/or to raise invalidity as a defense to infringement.

Why post-grant reviews? Statistics show that oppositions are used much more frequently in Europe than are reexaminations in the U.S. See, e.g., –Stuart J. Graham et al., Post-Issue Patent “Quality Control”: A Comparative Study of US Patent Re-examinations and European Patent Oppositions, available at (Aug. 5, 2002) (stating that “the rate of opposition at the EPO is more than thirty times higher than the rate of reexamination at the USPTO,” and that “opposition leads to a revocation of the patent in about 41 percent of the cases, and to a restriction of the patent right in another 30 percent of the cases,” compared with “cancellation of the patent right in only 12.2 percent of all” reexaminations). –Robert P. Merges, As Many as Six Impossible Patents Before Breakfast: Property Rights for Business Concepts and Patent System Reform, 14 Berkeley Tech. L.J. 577, 613 n.99 (1999) (stating that, in 1997, 6.8% of EPO patents were opposed, compared to 0.3% of U.S. patents reexamined). Some of the reasons are pretty obvious: –Challengers can raise any challenge, not just challenges based on prior art consisting of printed publications and patents; proceedings are adversarial; etc. –In comparison, ex parte reexaminations are limited in the type of evidence that can be considered, impose severe limits on third party involvement, etc. –Inter partes reexaminations are even less popular for various reasons. Possible downsides of oppositions: Potential for abuse? Increased costs to applicants?

Post-grant review of business method patents: AIA section 18 Not later than 9/16/2012, “the Director shall issue regulations establishing and implementing a transitional post-grant review proceeding for review of the validity of covered business method patents.” (AIA § 18(a)(1)) “The transitional proceeding implemented pursuant to this subsection shall be regarded as, and shall employ the standards and procedures of, a post-grant review under chapter 32 of title 35, United States Code,” subject to some exceptions. (AIA § 18(a)(1)(A)) “A person may not file a petition for a transitional proceeding with respect to a covered business method patent unless the person or the person’s real party in interest or privy has been sued for infringement of the patent or has been charged with infringement under that patent.” (AIA § 18(a)(1)(B)) –Query: What does “has been charged with infringement” mean?

Post-grant review of business method patents: AIA section 18 “A petitioner in a transitional proceeding who challenges the validity of 1 or more claims in a covered business method patent on a ground raised under section 102 or as in effect on” 3/15/2013, “may support such ground only on the basis of— –“(i) prior art that is described by section 102(a)... (as in effect on [3/15/2013]) or –“(ii) prior art that— “(I) discloses the invention more than 1 year before the date of the application for patent in the United States; and “(II) would be described by section 102(a)... (as in effect on [3/15/2013]) if the disclosure had been made by another before the invention thereof by the applicant for patent.” (AIA § 18(a)(1)(C)) “The petitioner in a transitional proceeding that results in a final written decision... with respect to a claim in a covered business method patent... may not assert... in a civil action... that the claim is invalid on any ground that the petitioner raised [not “could have raised”] during that transitional proceeding.” (AIA § 18(a)(1)(D)) “The Director may institute a transitional proceeding only for a patent that is a covered business method patent.” (AIA § 18(a)(1)(E))

Post-grant review of business method patents: AIA section 18 “The regulations issued under paragraph (1) shall take effect upon the expiration of [9/16/2012] and shall apply to any covered business method patent issued before, on, or after [9/16/2012]....” (AIA § 18(a)(2)) “This subsection, and the regulations issued under this subsection, are repealed effective upon the expiration of the 8-year period beginning on the date that the regulations issued under to paragraph (1) take effect.” (AIA § 18(a)(3)(A)) Stays of civil litigation may be granted based on considerations set forth in section AIA § 18(b). “[T]he term ‘covered business method patent’ means a patent that claims a method or corresponding apparatus for performing data processing or other operations used in the practice, administration, or management of a financial product or service, except that the term does not include patents for technological inventions.” (AIA § 18(d)(1)) “To assist in implementing the transitional proceeding authorized by this subsection, the Director shall issue regulations for determining whether a patent is for a technological invention.” (AIA § 18(d)(2)) “Nothing in this section shall be construed as amending or interpreting categories of patent-eligible subject matter set forth under section 101 of title 35, United States Code.” (AIA § 18(e)

Supplemental examinations AIA § 12 provides for supplemental examinations to fend off an inequitable conduct challenge. Specifically, it allows patent owners to request supplemental examinations “to consider, reconsider, or correct information believed to be relevant to the patent,” and providing that “a patent shall not be held unenforceable on the basis of conduct relating to information that had not been considered, was inadequately considered, or was incorrect in a prior examination of the patent if the information was considered, reconsidered, or corrected during a supplemental examination” concluded before the date on which the patentee files suit for infringement. A request for supplemental examinations will be considered under the “substantial new question of patentability” standard that governs in ex parte reexaminations. Effective 9/16/2012. May not matter too much, given the restrictive interpretation of the inequitable conduct doctrine announced earlier this year in Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276 (Fed. Cir. 2011) (en banc).