Any company that owns patents must learn about the Unites States Patent and Trademark Office’s new inter partes review proceedings. The America Invents Act (AIA) created new tools to challenge a patent’s validity outside of a court. The AIA createdInter Partes Review (IPR) which, among other new procedures, gives petitioners the ability to challenge the validity of a patent through an administrative proceeding in front of the newly-renamed Patent Trial and Appeal Board (PTAB). The PTAB only allows petitioners to challenge a patent’s validity based on the grounds of anticipation or obviousness. The petitioner makes their case-in-chief in the 60 page petition that may be supplemented with affidavits from expert witnesses. Once the petition is filed the patent owner has three months to file a preliminary response. The preliminary response can attack the petition, and the PTAB will determine whether or not to institute an IPR within 3 months of filing the preliminary response. The PTAB will then decide to conduct an IPR for whatever grounds in the petition present a reasonable likelihood that the patent is invalid. However, there are limits on when a petition can be filed.
The PTAB will not accept a petition for IPR in certain circumstances. First, a petition for IPR cannot be filed until after the latter of i) nine months after the grant of a patent, or ii) the date of termination of any post-grant review of the application. Additionally, the PTAB does not accept petitions to challenge the validity of a patent from parties who have been litigating that patent for more than a year. The one year bar for litigants does not stop a non-party from challenging the validity of a parent-in-suit. The ability to challenge a patent’s validity outside of court makes IPRs an effective tool for businesses who want to reduce the risk of suit.
IPRs also present a useful tool for parties involved in co-pending district court cases for three reasons. First, the PTAB must issue a written decision on validity within 12 months of instituting an IPR. Second, an IPR’s quick disposition and simplified discovery gives defendants a less expensive way to fight. Third, and possibly most importantly, the PTAB uses a lower evidentiary standard than the district court. The PTAB does not presume a patent is valid. The lack of deference means that a patent can be invalidated by a preponderance of the evidence. Petitioners do not have to prove their case with clear and convincing evidence. This last factor has already made IPRs an effective tool in fighting patent lawsuits. The PTAB has cancelled the vast majority of claims where the PTAB instituted an IPR.
IPRs present a faster, more economical and potentially more successful way to invalidate patents when compared to U.S. District Court litigation. The PTAB has already cancelled claims in the vast majority of written decisions. This is of particular importance to tech companies because the vast majority of those IPRs have covered computer and electrical patents.