On February 5, 2015, the Judiciary Committee of the House of Representatives’ re-introduced an anti-patent troll bill (Innovation Act of 2015, H.R. 9). This bill is essentially the same as the bill that was passed by Congress in December, 2013 but stalled in the Senate.
Most of the provisions are directed towards discouraging patent trolls from filing federal district court infringement actions. However, there are a few provisions that would affect inter partes review (IPR) and post grant review (PGR). These provisions include inter alia:
- Providing that the claim scope in IPR and PGR would be determined according to the Philips v. AWH ( Cir. 2005)(en banc.) standard used in district court litigation, rather than the Broadest Reasonable Interpretation (BRI) standard that the USPTO currently uses when an unexpired patent is involved in a IPR or PGR proceeding. See proposed amendment to USC § 316(a) & 326(a).
- Reducing the estoppel provision for a PGR petitioner. Under current law, a petitioner that loses a PGR (and real parties-in-interest or privies) may not assert any invalidity ground that “reasonably could have raised during the post grant proceeding” in a civil action or in a proceeding before the ITC The proposal eliminates “reasonably could have” from this provision so that this estoppel would only be with respect to grounds that the petitioner actually raised. This would-allow patent challengers to start PGR proceedings without the substantial “chilling” effect of not knowing how far estoppel would apply, should the PGR prove unsuccessful. See proposed amendment to 35 USC §325(e)(2).
- Expanding the type of prior art that can be relied upon in the transitional Covered Business Methods (CBM) program to include 102(e) secret prior art. See proposed amendment to AIA § 18(a)(1)(C)(i).
While the expansion of prior art in the transitional CBM program and weakening of the estoppel provision would be favorable to petitioners, the use of the Philips standard, as opposed to the BRI standard, for claim construction would disadvantage petitioners.
The BRI standard currently used in USPTO proceedings increases the likelihood for a petitioner to show unpatentability at the USPTO compared with showing invalidity in a district court. The proposed modification provision is most likely motivated to provide a more consistent claim scope across forums, thereby providing better certainty for the affected parties.
On February 4, 2015, the day before HR 9 was introduced, the Court of Appeals for the Federal Circuit held that the BRI standard is the appropriate standard for IPR proceedings. See In Re Cuozzo Speed Technologies, LLC, 2014-1301. The Federal Circuit found that the use of the BRI standard in IPR proceedings was properly adopted by USPTO regulations (Cuozzo at pgs. 18-19) and that “Congress in enacting the AIA was well aware that the broadest reasonable interpretation standard was the prevailing rule” and therefore “impliedly adopted the existing rule” (Cuozzo at pg. 14).
Thus, the Federal Circuit points to the silence of Congress with respect to the proper claim construction standard as a reason why the BRI standard should be maintained in IPR proceedings. But Congress will have clearly expressed its intent to change this standard if the Innovation Act in its current form becomes law.
A link to the bill is provided below: Innovation Act