Inter Partes Review
On April 24, the U.S. Supreme Court handed down two opinions pertaining to inter partes review (IPR); a relatively new mechanism for challenging the validity of a U.S. patent, enacted by the America Invents Act (AIA) in 2012. IPR allows anyone to challenge the validity of an issued patent on the grounds that the subject matter covered by the patent is the same as, or would have been obvious in light of, other patents or printed publications that would have been available when the patent application was filed, provided the challenger can demonstrate a reasonable likelihood of success.

Challenging the validity of an issued patent is nothing new; however, IPR and post-grant review (PGR) are relatively new administrative procedures brought before the Patent Trial and Appeal Board (PTAB), itself a relatively new administrative body within the United States Patent and Trademark Office (USPTO; acronyms, this is what I do with my life). Many institutional patent holders have felt a lot of pressure on their patent portfolios: patents issued by the USPTO aren’t necessarily safe even within the walls of the USPTO. Some of those patent holders have challenged the constitutionality of the IPR process.

Oil States Energy Services LLC v. Greene’s Energy Group, LLC
Oil States Energy obtained U.S. Patent No. 6,179,053 and sued Greene’s Energy for infringement. Greene’s Energy challenged the validity of the patent in District Court and at the USPTO, using IPR with both proceedings going on in parallel. The District Court seemed to favor Oil States while the PTAB found Oil States claims unpatentable. Oil States appealed to the Federal Circuit both on patentability of the claims and constitutionality of the IPR process (that is, patents should only be invalidated by an Article III, or judicial court). The Federal Circuit subsequently issued a ruling in another case upholding the constitutionality of IPR. The Supreme Court held that Congress has the power to assign the judgment of public rights (such as patent rights) to entities other than Article III courts.

So IPRs (and presumably PGRs) are constitutional, but maybe there are administrative limitations to the scope of such reviews. If administrative courts like the PTAB have the power to adjudicate patent rights, perhaps the administrators of the USPTO have some discretion in determining the scope of those adjudications.

SAS Institute Inc. v. Iancu, Director, USPTO
SAS petitioned to review all the claims in a patent issued to ComplementSoft under IPR. The Director instituted review of some, but not all the claims pursuant to USPTO regulations allowing partial institution. SAS challenged the partial institution provision, maintaining that all the claims should have been reviewed. The Supreme Court agreed, holding that SAS’s petition, not the discretion of the Director, should guide the scope of the litigation.

Together, Oil States and SAS indicate that the PTAB has the constitutional authority to adjudicate patent rights, but not the authority to alter the scope of the rights being adjudicated. Aspects of the STRONGER Patents Act might have an impact on IPRs if it ever gets signed into law; for example, under the proposed law, only entities that have been sued can bring an IPR challenge, and issued patents would have a presumption of validity. But those changes are prospective at best.

It seems to me, the best defense to any kind of validity challenge is, and always has been, aggressively making the examiner aware of the prior art during prosecution. If a patent applicant tells the examiner about a reference, and the examiner reviews the reference during prosecution and still issues the patent, validity challenges become less problematic. On their own, examiners are pretty good at putting together the prior art; but when tens or hundreds of millions of dollars are at stake, even incompetent litigators can piece together some kind of validity argument (and they always do)..

Also, make sure all the issued claims are valuable. Even if some claims in an issued patent are eventually judged invalid, other claims might survive. If a challenger thinks they might prevail on some claims but ultimately still infringe on other valid claims, that might be enough to dissuade the challenger altogether.

Don’t be put off from pursuing patent protection for your inventions. Validity challenges have always existed; you’re only hearing about them now because the process is new. In some sense, it’s heartening that post grant validity challenges are being conducted by the USPTO; at least the process is being handled by patent professionals.

Suiter Swantz IP is a full-service intellectual property law firm, based in Omaha, NE, serving all of Nebraska, Iowa, and South Dakota. If you have any intellectual property questions or need assistance with your patent, trademark, or copyright matters and would like to speak with one of our attorneys please contact us.