Improving patent quality with post-grant opposition?
Joseph Hosteny, in the August 2004 issue of Intellectual Property Today, criticized the analysis of "Prospects for Improving US Patent Quality via Post-Grant Opposition." Although he did not give a cite, he may have been referencing the paper by Bronwyn Hall, Stuart Graham, Dietmar Haroff, and David Mowery (none of whom seem to be patent lawyers). This paper compares European opposition procedures to American re-exam methods, but does not formulate an explicit proposal for an American opposition method. Thus, we discuss below some comments of the AIPLA. [The paper by Hall et al. cites, but does not endorse, the rational ignorance paper of Mark Lemley; further, it recognizes the "knowledge spillover" value of a patent but does not attempt to quantify this value in the overall picture of "patent quality." Because no entity is likely to oppose patents of no economic value (such as the swing patent cited therein, US 6,368,227), the paper is problematic in proposing a solution that will not cure the defects identified. Oppositions will address patents perceived to be economically valuable.]
One advocate of the opposition mechanism is the AIPLA, which wrote:
In view of the absence of an effective and inexpensive means to challenge patents, AIPLA, the PTO, the Federal Trade Commission (FTC), the NAS, and, just last week [ca. June 2004], the Intellectual Property Law Section of the ABA have all put forth suggestions for post-grant opposition proceedings as a means of permitting a more meaningful, timely and cost-effective opportunity for the public to challenge patents that may be of questionable validity.
In 1996, AIPLA proposed the establishment of a post-grant opposition system to provide parties with an efficient, effective, and relatively inexpensive procedure to evaluate whether the claims of an issued patent are too broad or simply should not have been issued at all. The PTO, as part of its 21st Century Strategic Plan released in 2002, called for the post-grant review of patents. Last October, the FTC, in its report entitled “To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy,” also recommended the establishment of an effective post-grant opposition system. Earlier this year, the NAS, in its report mentioned earlier, recommended the creation of an “Open Review procedure” to provide “more timely, lower cost, and more efficient review of granted patents” to replace the current reexamination procedures. The resolution adopted by the IPL Section of the ABA is generally supportive of a post-grant proceeding along the lines of the proposal AIPLA has developed. The call for an effective, efficient post-grant system to review patents has reached a crescendo. It is time to act.
The AIPLA proposal includes the following:
Nine-month post-issuance period in which to request the opposition.
Requirement to identify the real party in interest, but allowing its name to be kept confidential in appropriate cases, until such time as justice and fairness require disclosure.
“Front loading” of the requester’s evidence supporting the opposition is required to expedite the proceedings.
Opportunity for the patent owner to respond with evidence.
Opportunity for the patent owner to amend the claims at least once.
Discovery is normally limited to cross-examination of affiants, but could be extended if required in the interests of justice.
Requester has the burden of proof by a preponderance of the evidence.
One-year time limit, start to finish, but extendable to no more than 18 months in appropriate cases.
Opportunity for oral hearing, filing briefs, reconsideration, and appeal to CAFC by all parties to the opposition.
Bar to any later inter partes reexamination by the opposer and no concurrent reexamination proceeding until the opposition terminates
Estoppel against unsuccessful requester as to the validity issues actually decided, but with exceptions for issues based on later availability of new material evidence regarding a legal or factual issue.
The AIPLA also noted:
The adoption of any post-grant opposition system by the United States would be of limited value unless the necessary resources are dedicated to its implementation. As a point of reference, the latest statistical report of the European Patent Office (EPO) indicates that the EPO granted 59,992 European patents in 2003. That same year, 2,634 patents, or approximately 4.4%, were opposed. In the context of the PTO which granted 189,597 patents in 2003, this would translate into over 8,000 oppositions. Even discounting this number by 90% to account for patent owners or others who would continue to use ex parte reexamination to test patent validity and who would be reluctant to use the post-grant opposition procedure, one could still be looking at a potential caseload that is many times the number of interferences currently handled by the Board. While interferences are admittedly more complex than the proposed post-grant oppositions, the adoption of a post-grant opposition system would require a significant increase in the number of APJs (20 of the 61 APJs currently at the Board are exclusively dedicated to interferences). Hiring the number of properly trained and skilled individuals needed to handle post-grant oppositions – irrespective of which proposal is adopted – will be essential if the system is to achieve the results intended. We cannot overlook this need when considering this change to the patent system.
One advocate of the opposition mechanism is the AIPLA, which wrote:
In view of the absence of an effective and inexpensive means to challenge patents, AIPLA, the PTO, the Federal Trade Commission (FTC), the NAS, and, just last week [ca. June 2004], the Intellectual Property Law Section of the ABA have all put forth suggestions for post-grant opposition proceedings as a means of permitting a more meaningful, timely and cost-effective opportunity for the public to challenge patents that may be of questionable validity.
In 1996, AIPLA proposed the establishment of a post-grant opposition system to provide parties with an efficient, effective, and relatively inexpensive procedure to evaluate whether the claims of an issued patent are too broad or simply should not have been issued at all. The PTO, as part of its 21st Century Strategic Plan released in 2002, called for the post-grant review of patents. Last October, the FTC, in its report entitled “To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy,” also recommended the establishment of an effective post-grant opposition system. Earlier this year, the NAS, in its report mentioned earlier, recommended the creation of an “Open Review procedure” to provide “more timely, lower cost, and more efficient review of granted patents” to replace the current reexamination procedures. The resolution adopted by the IPL Section of the ABA is generally supportive of a post-grant proceeding along the lines of the proposal AIPLA has developed. The call for an effective, efficient post-grant system to review patents has reached a crescendo. It is time to act.
The AIPLA proposal includes the following:
Nine-month post-issuance period in which to request the opposition.
Requirement to identify the real party in interest, but allowing its name to be kept confidential in appropriate cases, until such time as justice and fairness require disclosure.
“Front loading” of the requester’s evidence supporting the opposition is required to expedite the proceedings.
Opportunity for the patent owner to respond with evidence.
Opportunity for the patent owner to amend the claims at least once.
Discovery is normally limited to cross-examination of affiants, but could be extended if required in the interests of justice.
Requester has the burden of proof by a preponderance of the evidence.
One-year time limit, start to finish, but extendable to no more than 18 months in appropriate cases.
Opportunity for oral hearing, filing briefs, reconsideration, and appeal to CAFC by all parties to the opposition.
Bar to any later inter partes reexamination by the opposer and no concurrent reexamination proceeding until the opposition terminates
Estoppel against unsuccessful requester as to the validity issues actually decided, but with exceptions for issues based on later availability of new material evidence regarding a legal or factual issue.
The AIPLA also noted:
The adoption of any post-grant opposition system by the United States would be of limited value unless the necessary resources are dedicated to its implementation. As a point of reference, the latest statistical report of the European Patent Office (EPO) indicates that the EPO granted 59,992 European patents in 2003. That same year, 2,634 patents, or approximately 4.4%, were opposed. In the context of the PTO which granted 189,597 patents in 2003, this would translate into over 8,000 oppositions. Even discounting this number by 90% to account for patent owners or others who would continue to use ex parte reexamination to test patent validity and who would be reluctant to use the post-grant opposition procedure, one could still be looking at a potential caseload that is many times the number of interferences currently handled by the Board. While interferences are admittedly more complex than the proposed post-grant oppositions, the adoption of a post-grant opposition system would require a significant increase in the number of APJs (20 of the 61 APJs currently at the Board are exclusively dedicated to interferences). Hiring the number of properly trained and skilled individuals needed to handle post-grant oppositions – irrespective of which proposal is adopted – will be essential if the system is to achieve the results intended. We cannot overlook this need when considering this change to the patent system.
posted by Lawrence B. Ebert at 9:12 PM
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