USPTO Forms Council to Bolster Inventor Diversity Platform

Timothy Maier

Earlier this year, the USPTO launched the new Expanding Innovation Hub Platform. The Hub is designed to help foster inventorship from underrepresented groups including both female and minority inventors. As emphasized by USPTO Director Andrei Iancu, “To maintain our technological leadership, the United States must seek to broaden our intellectual property ecosystem demographically, geographically, and economically.”

The Hub includes an educational toolkit to help new inventors understand the system, mentoring programs to match inventors with individuals who can help them succeed in the system, and community groups to foster support and cooperation between inventors. The Hub will also serve as a base for events and programming focused on spurring innovation from the underrepresented groups.

Now, the USPTO has established the National Council for Expanding American Innovation (“NCEAI”). The Council is made up of 29 practitioners and Federal representatives and is tasked with building “a more diverse and inclusive innovation ecosystem” as emphasized by Director Iancu above. Part of the Council’s task will be period reporting such as the “Progress and Potential” report on female inventorship to hold the council accountable to the stated goals.

Per the Director of Commerce, Wilbur Ross, “It is critical that industry, academia, and government work together to strengthen our culture of innovation by encouraging the participation of young people from diverse backgrounds.”

One shining example of success Is the celebrated Dr. Marian Cloak, who was honored with an “Inventor Card” as part of the USPTO’s collectible card series. Dr. Croak emphasized the need for support and role models, explaining that “I think the more role models that people have, the more inspired they are to understand that they are capable of doing anything.” Dr. Croak will join Director Iancu later in October in the USPTO Speaker Series to address her path to success, her pioneering of VoIP advancements and 200 patents, and the goals of Direcor Iancu’s goals for a more diverse innovation pool.

However, these goals cannot be achieved by the USPTO or even the federal government alone. In the NCEAI are 29 industry representatives similarly committed to the cause, but industry support must be expanded for this to be successful.

Maier & Maier has long been a supporter of diverse inventorship in the industry, with a strong commitment to underserved inventors. Maier & Maier has made it a firm priority to assist solo inventors whenever possible and has a demonstrated commitment to leveling the playing field for inventors and practitioners alike. Our team consists of a diverse group of individuals speaking a variety of languages and from a variety of different countries, backgrounds, and identities.

We are committed to continuing on this path, and we welcome underrepresented inventors and practitioners to reach out to us at any time.

USPTO Announces Final Fee Schedule Update

Timothy Maier

The USPTO is set to implement changes to its Fee Schedule on October 2, 2020. Per the USPTO announcement, this update is “necessary to adjust to increasing costs and to provide necessary resources for Patent operations, including implementing the USPTO 2018-2022 Strategic Plan.”  The changes include an approximate 5% increase of fees across the board.

Certain fees were increased by substantial more than 5%. Most significant were AIA request and post-institution fees which were increased by up to 50%, with most coming in at 20-25% increases. This substantially affects the costs for PTAB post grant practice for petitioners and those considering their options for IP disputes.

This process began in 2017 in accordance with federal fee setting requirements. The process has included a public forum at the USPTO headquarters in Alexandria, Virginia, comments, and extensive review by the Patent Public Advisory Committee (PPAC). The fees were initially planned to be announced and come into effect earlier this summer but were delayed due to the state of the U.S. economy and the ongoing pandemic.

Notable changes include the addition of two new fees (for pro hac vice admission and effective January 1, 2021 a fee for non docx format submissions), four discontinued fees, and increases to most existing fees.

Further, it is especially important to note the following fee increases for PTAB proceedings:

  • Inter Partes Review Request Fee: This fee will increase from $15,000 to $19,000.
  • Inter Partes Review Post-Institution Fee: This fee will increase from $15,000 to $22,500
  • Total Fees for an instituted IPR increase from $30,000 to $41,500
  • Post Grant Review Request Fee: This fee will increase from $16,000 to $20,000
  • Post Grant Review Post-Institution Fee: This fee will increase from $22,000 to $27,500
  • Total Fees for an instituted PGR increase from $38,000 to $47,500
  • Additional fees may be incurred for each claim in excess of 20.

The full fee schedule table is available for download here and the USPTO announcement is available here.  In the meantime, filing cases before the October 2nd increase could provide significant cost savings and should be considered.

USPTO Issues IPR Guidance On § 311(b) Prior Art

Timothy Maier

On August 18, 2020, the USPTO issued guidance on § 311(b)’s institution requirement that IPR’s may only be petitioned “on the basis of prior art constisting of patents or printed publications” and how this applies to statements of the applicant in the specification.

The use of statements like these is referred to as ‘Applicant-Admitted Prior Art’ or APAA. Under the new guidance, APAA may not be used as the basis for an IPR but may still be permissible for other evidenciary purposes.

Previously, some Boards allowed the use of APAA under the logic that  “it is ‘prior art’ and found in a ”patent’. See, e.g., Cardiovascular Sys., Inc. v. Shockwave Med., Inc., IPR2019-00405, Paper 75, at 35-36 (PTAB Jul. 8, 2020); Apple Inc. v. Qualcomm Inc., IPR2018-01315, Paper 26, at 18-19 (PTAB Jan. 3, 2020); One World Techs., Inc. v. Chamberlain Group, Inc., IPR2017-00126, Paper 56, at 36-37 (Oct. 24, 2018) . As the Guidance explains, this interpretation is inconsistent with the statute, which is more accurate read to mean “any patent that is used as the “basis of’ a request for inter partes review must be a prior art patent, not the challenged patent.” Guidance at 3.

As a result, the PTAB will no longer allow APAA as the basis for a petition, but will allow its use for the following three purposes:

“(1) supply missing claim limitations that were generally known in the art prior to the invention (for pre-AIA patents) or the effective filing date ofthe claimed invention (for post-AIA patents);

(2) support a motivation to combine particular disclosures; or

(3) demonstrate the knowledge of the ordinarily-skilled artisan at the time ofthe invention (for pre-AIA patents) or the effective
filing date ofthe claimed invention (for post-AIA patents) for any other purpose related to
patentability”.” Guidance at 9.

Federal Circuit Overturns Pre-Suit Damage Award Against NetScout

Timothy Maier

On July 22, the Federal Circuit ruled that marking requirements for pre-suit damages cannot be satisfied based on defendant’s infringement of a related method claim in Packet Intelligence LLC v. NetScout Systems, Inc.

In the case, Packet Intelligence sued NetScout Systems for patent infringement in the Eastern District of Texas. The Jury found in favor of Packet Intelligence on all issues and awarded both pre-suit and post-suit damages. Following the jury trial, the court also enhanced damages and awarded an ongoing royalty for post-verdict infringement.

NetScout appealed to the Federal Circuit, arguing that in order to be subject to pre-suit damages Packet intelligence’s licensees must have properly marked their patent-practicing products. NetScout concluded that because they failed to do so, the award of pre-suit damages was in error. The Federal Circuit agreed.

Judge Lourie explained in the written opinion. While the defendant has the primary burden to “articulate the products it believes are unmarked ‘patented articles”, this initial burden was met by NetScout. The low bar for this need only “put the patentee on notice that certain licensees sold specific unmarked products”. The Federal Circuit ruled that the District Court incorrectly placed a burden on them to prove these products practiced the patent, when the burden should rightly be on the plaintiff to demonstrate that they did not.

Finally, the Federal Circuit was not convinced that NetScout’s infringement of related patents could be used to satisfy the marking obligation in place of actual compliance. Per the decision, “Packet Intelligence is barred from recovering damages for pre-suit sales of the…products because it failed to comply with the marking requirement. It cannot circumvent § 287 and include those products in its royalty base simply by arguing that NetScout’s infringement of related method claims drove sales.”

Federal Circuit Upholds Subject Matter Eligibility Review for Substitute Claims In IPR Proceedings

Timothy Maier

The Federal Circuit ruled that the PTAB May review all aspects of patentability for substitute claims in inter partes review (IPR) proceedings in Uniloc 2017 LLC v. Hulu, LLC last month.

At the PTAB, Hulu petitioned for IPR on Uniloc’s patent “System and Method for Adjustable Licensing of Digital Products”.  In the course of the proceeding, Uniloc offered substitute claims under $ 316(d). Hulu challenged these substitute claims as obvious under § 103, as enlarging the claim scope in violation of § 316(d), and as claiming non-statutory subject matter under § 101. The Board rejected the first two grounds, but agreed that the substitute claims were ineligible under § 101. Based solely on its ineligibility under § 101, the Board then rejected Uniloc’s proposed substitute claims.

After a failed rehearing at the PTAB arguing that substitute claims could not be reviewed under § 101, Uniloc appealed the decision to the Federal Circuit. The Federal Circuit upheld the Board’s ruling with Judge Wallach authoring the decision. The Federal Circuit found that the Board is to find “patentability” of substitute claims in IPR cases, based on legislative history and structure of the statute the court found this to require a full analysis of proposed substitute changes, and is not limited by § 311(b) for these purposes. The Federal Circuit accordingly reasoned that the Board was correct in including § 101 in its patentability analysis for substitute claims.

This is a significant development and should be noted with caution for patent owners and petitioners alike at the PTAB to factor into their decisions in any IPR proceeding with substitute claims.

Ongoing Pandemic Highlights Importance of S-Signatures

Timothy Maier

Disruption to travel, mail, and in-person meetings caused by the ongoing COVID-19 pandemic has made acquiring signatures problematic and the need for inventor signatures has created a direct impact on the patent procedures for many companies.   To mitigate these issues, it is increasingly important for applicants and their counsel to understand the United States Patent Office’s acceptance of electronic signatures.  Pursuant to 37 C.F.R. § 1.4(e), electronic signatures are acceptable for all submissions to the USPTO except correspondence relating to registration to practice before the Patent and Trademark Office in patent cases, enrollment and disciplinary investigations, or disciplinary proceedings; and payments by credit cards where the payment is not made by the electronic filing system.  Electronic signatures have been used regularly by U.S. attorneys for patent filings since their acceptance began in 2004.

Electronic signatures may also be used for documents including inventor declarations and powers of attorney. This can greatly facilitate obtaining signatures in a remote workforce. However, it is important to note that the relevant inventor or employee must affix his or her own signature to the document, regardless of whether that signature is electronic or handwritten.  The proper method for electronic signatures is referred to as the “S-Signature,” which requires the inventor to place his or her name in between a pair of forward slashes (Ex: “/John Smith/”) on the signature line.  While the signing individual must apply their own signature (type their name) to the document, the slash marks do not have to be entered by the signing party.  For example, the slashes may be pre-inserted in a document before it is sent to an inventor for signature.  This may further increase efficiency and ensure proper application of the signature.

While the USPTO accepts electronic signatures, if the signature were to become the subject of a contentious matter, there is little evidence of who signed and when they signed the document.  The evidence is often limited to the e-mail exchange in which the signed document was attached.  However, certain signature services may be used to verify the authenticity electronic signatures.  It is important to note that the signatures must still include the slashes.  Pre-inserting the slashes or building them into a signature workflow may also be done when using a signature service, which can make the process more efficient for the signing party and reduce the chance of improper signature application.

For applicants and patent owners with international concerns, it is important to consider the rules of all applicable jurisdictions.  Notably, the U.S. and Patent Cooperation Treaty (PCT) have enacted rules regarding the acceptance of electronic signatures in the form of S-Signatures.  However, some countries may require handwritten signatures or enhanced electronic signature procedures.

Assignments, licenses, and other grants carry additional considerations globally and even within the U.S. because the validity of such grants is generally interpreted according to the controlling law, which may be state law.  There is no universal rule indicating what type of electronic signatures will be sufficient in court.  In the United States, the Electronic Signatures in Global and National Commerce (ESIGN) Act in 2000 made electronic signatures legal in every state and U.S. territory when federal law applies.  All states and Washington D.C. have enacted some form of electronic signature laws, mostly adopting the Uniform Electronic Transactions Act (UETA).  Notable states that have not enacted the UETA, but have instead enacted their own electronic signature laws include Illinois, New York, and Washington.  As a result, in order to determine whether an electronic signature is sufficient in a given jurisdiction, it is still important to check local rules.

It is possible that an electronic signature may be contested years after the relevant document was signed.  Therefore, it may be prudent to bolster the validity of an assignment or license signature with additional evidence.  The evidence needed to do this varies from jurisdiction to jurisdiction, but options include remote notarization, electronic signature software, video evidence of the signing, or bolstering the S-Signature with a traditional ink signature once in person signings become feasible.

In the United States, notarization greatly bolsters the validity of an assignment signature.  35 U.S.C. § 261 states that a notarization “shall be prima facie evidence of the execution of an assignment, grant or conveyance of a patent or application for patent.” In other words, a notarized signature shifts the burden to the challenger to prove that the signature is not authentic.  Notarization can be done remotely so long as the signer is willing to verify his or her identity by sending the notary copies of his or her ID and other identifying information.  A notarized signature is preferable to a witnessed signature, as the notarization does not require the notary to testify to the authenticity.

If neither a notary nor a witness is available, the authenticity of an electronic signature can be bolstered by electronic signature software.  These tools add authenticity and anti-tampering features to an electronic signature and may retain records on the signing that can be recalled later.  However, the acceptability of these types of software is not always consistent among international jurisdictions.  It may also be beneficial to have video evidence of the signature being applied.

In foreign countries, the acceptability of electronic signatures varies from country to country.  In Europe for instance electronic signatures made with anti-tampering software may qualify as “advanced signatures,” which may be very likely to be considered authentic.  Other countries may only accept traditional signatures and notaries.  To cope with the realities of the pandemic, it may be necessary to use an electronic signature at first and establish procedures for bolstering those signatures with traditional signatures and notarization later affirming their validity.

With a remote workforce and social distancing practices, it is important to consider the efficiencies of electronic signatures for your patent procedures.  If you have any questions about whether electronic signatures are appropriate for your specific needs, please contact a Maier & Maier attorney today.

USPTO Expands COVID Response To Restore Benefit of and Right of Priority to Prior-Filed Applications

Timothy Maier

The USPTO has been active in responding to the COVID-19 pandemic. They’ve extended deadlines for affected applicants and practitioners multiple times, established multiple pilot programs related to the virus, and taken steps to make sure they can continue operations throughout the pandemic.

Now the USPTO has expanded its adjustments to allow applicants to restore benefit of and right of priority to Prior-Filed Applications. In the notice, the USPTO explains that if the delay was unintentional, applicants may petition for the restoration for their application. The notice grants a two-month extension for the filing and waives the petition fee under § 1.17(m).

This will be available for application claiming the end of a 12-month or 6-month period which fell in a period starting March 27, 2020 and ending after July 30, 2020. This applies to non-provisional utility claiming to both foreign applications (under § 119(a) and § 172) and provisional applications (§ 119(e)), and to foreign applications claiming right of priority.

In order to obtain the extension, as with the other extensions, applicant must demonstrate that the delay was unintentional and due to the COVID-19 outbreak. The USPTO highly encourages the use of this form to establish the COVID-19 connection.

Any questions or concerns regarding your applications or other USPTO matters can be brought to us at info@maierandmaier.com.

USPTO Publishes PTAB Rule Changes For Public Comment

Timothy Maier

The USPTO has published proposed changes to the rules governing proceedings at the PTAB. Comments must be submitted by June 26th to be considered. A majority of the changes conform the rules with current PTAB practices already adopted, while one specific change would represent a diversion from the norm.

First, the proposal would adopt the Supreme Court’s SAS Institute decision changes to institution at the PTAB. In the decision on whether to institute, the Board would be required to choose between instituting on all or none of the grounds for rejection proposed in the petition. As established by the Supreme Court, this rule would prohibit partial institutions.

Second, the proposed rules would allow sur-replies to principal briefs and a response and reply by the patent owner to decision on institution. This rule echoes changes to the Office Trial Practice Guide from August 2018 and aligns the rules with the current practices by the Board in proceedings.

Finally, the proposed changes would revise 37 C.F.R. 42.108(c) and 42.208(c). Currently, the Board’s determination of whether there are sufficient grounds for institution is described as follows:

The Board‘s decision will take into account a patent owner preliminary response where such a response is filed, including any testimonial evidence, but a genuine issue of material fact created by such testimonial evidence will be viewed in the light most favorable to the petitioner solely for purposes of deciding whether to institute an inter partes review.

Under the proposed change, the description would end before granting the presumption in favor of the petitioner. Under the proposal, the rule would instead read:

The Board‘s decision will take into account a patent owner preliminary response where such a response is filed, including any testimonial evidence.

Per the notice, the USPTO believes this rule change will ensure that “any testimonial evidence submitted with a patent owner’s preliminary response will be taken into account as part of the totality of the evidence.” This would shift the burden away from the patent owners and likely lead to a lower institution rate at the PTAB.

The PTAB is hosting a Boardside Chat on Thursday June 11 from 12:00 noon until 1:00 PM where they will discuss the proposals.

If you have any questions or concerns about these changes, how they may affect your filings, or are interested in submitting comments and would like assistance, please feel free to reach out to us here.

USPTO Announces Next Round of Coronavirus Extensions

Timothy Maier

In the past few months, the USPTO has made a number of extensions and changes in response to the spread of coronavirus. Previously, the USPTO had extended deadlines that would have come between March 27 and April 30 by 30 days and then deadlines from March 27 to May 31 to June 1st for those affected by the virus.

Now the USPTO has announced a further extension to July 1st for small and micro entities. Additional extensions for entities of all sizes will remain available on a case-by-case basis through the filing of an extension of time or petition to revive, with the revival petition filing fee waived for those abandoned before June 30.

Any questions or concerns regarding your applications or other USPTO matters can be brought to us at info@maierandmaier.com.

PTAB Discretionary Denial On The Rise

Timothy Maier

The timing considerations that go into filing a petition for inter partes review with the PTAB have become progressively more difficult to navigate as the PTAB exercises increased discretion in rejecting IPRs. This trend started with the precedential NHK decision in which the PTAB rejected an IPR petition on the basis of an upcoming district court trial. Since then, the Federal Circuit has continued to provide the PTAB with increased autonomy by expanding its discretion to institute IPR under 314(a).

Likewise, in the Thryv decision the Supreme Court all but cut off any review of institution by the Federal Circuit, and in the SAS decision, the Supreme Court determined that all PTAB decisions on whether to institute IPR have to be binary, either instituting on all grounds or denying IPR altogether. Following SAS, the PTAB also started to deny institution of IPR where there is a reasonable likelihood that the petitioner will prevail on only a minority of the proposed grounds for unpatentability. For example, in Biofrontera v. DUSA Pharms the PTAB exercised its discretion to deny institution where the petitioner only showed a reasonable likelihood of success on only 1 of 8 grounds.

Since the NHK decision, many patent owners have raised NHK in an attempt to thwart institution of IPR as redundant to invalidity defenses raised in district court proceedings. Approximately 33 patent owner preliminary responses have raised NHK in similar circumstances since December 2018, with 20 of those cases being decided in Jan to May of 2020 alone. Below is a chart detailing the 10 cases where IPR institution has been denied on the basis of an NHI argument, consolidated into a single entry where multiple IPR denials related to the same parallel district court case.

Table 1: IPR denied based on NHK

Decision Date Case Name* Materially different prior-art arguments raised in the IPR petition(s)? Months until district court trial after the IPR institution decision**
12/3/2018 Mylan v. Bylar No 4
10/16/2019 Next caller v. Trustid No 9
1/22/2020 Magellan v. Sunoco No 2
3/10/2020 Bentley v. Jaguar Yes 7
3/26/2020 Ford v. MIT No 0 (finished, under appeal)
3/27/2020 Google v. UNILOC No 5
5/13/2020 Apple v. FINTIV No 10
5/15/2020 Cisco v. Ramot at Tel Aviv No 6
5/19/2020 Intel v. VLSI No 5-7, estimated

 

The most recent of these cases is perhaps one of the most favorable to the patent owner. In a series of decisions captioned Intel v. VLSI, the PTAB relied on NHK to deny review under 314(a) even though the District court has suspended its trial schedule due to Covid-19. Significantly, petitioner Intel filed its IPR petitions fully three months prior to the one-year statutory deadline after service of the district court complaint. Acknowledging these facts, the PTAB focused on the significant investment that had already gone into the parallel district court case, with fact discovery scheduled to end in May. Additionally, the trial date was set for October 2020, with a final written decision from the PTAB likely not to come until May 2021 if IPR were instituted. Even with the district court currently closed due to Covid-19, the PTAB found that it is likely the district court will go to trial before a final decision is reached. In weighing all the factors set forth in NHK, the PTAB ultimately decided that the likelihood of a district court trial in 5 to 7 months warranted denial of review.

The cases identified above are just the first in a series of PTAB developments favoring patent owners. With the ever-evolving landscape of IPR litigation it has become even more important than ever that parties looking to petition for IPR have capable and knowledgeable counsel who are able to navigate the unwritten rules of discretionary denial of IPRs.