Former Chief Judge Rader minced no words when he labelled the Patent Trial and Appeal Board (“PTAB”) a “death squad” for patents back in 2013.1 And indeed, initial statistics depicted an uphill battle for patent owners. But recent statistics and guidance have hinted at the emergence of a new PTAB—a kinder, gentler PTAB that may be pulling away from its harsher past.
A study released in 2016 of 2015 PTAB decisions, for example, found a significant drop in the percentage of challenged claims that were found unpatentable or cancelled in final inter partes review (“IPR”) decisions.2 The same was true in covered business method (“CBM”) proceedings.3 The PTAB has also been instituting a consistently lower percentage of inter partes reviews than it has in the past.4 These trends held true through 2017.5
And in November 2016, the PTAB upheld a patent for the first time in a final decision following post-grant review.6 The petitioner argued that the claims were unpatentable as obvious over two lots of the petitioner’s phenylephrine hydrochloride ophthalmic solution products.7 But, after deliberation, the PTAB concluded that the petitioner did not meet its burden of proving obviousness by a preponderance of the evidence.8
The main question is why the recent trend exists. Some suggest that this is a natural response to a surge of lower-quality petitions filed on the false hope provided by high initial IPR and CBM petition success rates. Others feel that it is a result of higher-quality petition responses filed by patent owners reacting to those rates. Still others attribute the decrease to the more general downward trend in district court litigation.
But the U.S. Patent & Trademark Office (“Patent Office”) itself also seems to be taking an active role in distancing itself from its “death squad” image. In April and May of 2014, the Patent Office conducted a nationwide listening tour seeking public feedback on America Invents Act (“AIA”) proceedings.9 In 2015, in response to the comments they received, the Patent Office increased the page limit for a patent owner’s motion to amend by ten pages and allowed the claims appendix to be counted separately.10 Also in response, the Patent Office made substantial amendments to its rules effective May 2016.11 Patent owners may now submit testimonial evidence (e.g., an expert declaration) with its preliminary response.12 The new rules also provide for a new Rule 11-like sanction on practitioners that have not performed an adequate prefiling investigation.13
Recently appointed chief judge of the PTAB David Ruschke has been one of the most vocal about the PTAB’s changing vision, stating to reporters that it was “obvious that there are many concerns about potential unfairness to patent owners.”14 Ruschke stated that he “take[s] [Patent Office] Director [Michelle] Lee’s mandate very seriously that PTAB proceedings need to be fair and efficient and serve as a timely and cost-effective alternative.”15
Michelle Lee, too, has taken a greater interest in PTAB proceedings. Lee recently showed an interest in serving as a judge during a PTAB proceeding, stating that “[s]erving as a judge on a PTAB trial would be an informative experience. It’s important to know firsthand how these proceedings are unfolding.”16 She pointed to the new rules allowing patent owners to submit testimonial evidence as being “helpful,” noting that “[h]aving only one side submit it and not the other was perhaps not as fair.”17
Whatever the reason, it will be interesting to see whether the trend continues its current path, or reverts back to its old “death squad” ways.