As we mark World IP Day, it provides an opportunity to marvel at the critical role the American system of protecting IP, particularly patents, has played in the United States’ global innovation leadership.
Unfortunately, recent years have seen too many efforts to undermine those critical property rights. One recent bill is a perfect example of that trend.
If someone set out to give a gift to Big Tech and the Infringer Lobby, worsen the Administrative State element of our patent system and advantage our innovation adversaries such as China, it would take some doing to check all these boxes more fully than S. 2891, the “Restoring the America Invents Act.”
The impartial blog Patently-O calls RAIA “basically a wish list of patent-killers seeking to cancel patent rights via inter partes review.”
S. 2891 aims to reduce Patent and Trademark Office director discretion to deny IPRs, make federal courts subservient to quasijudicial administrative panels, expand what the Patent Trial and Appeal Board examines in patent challenges and PTAB’s ability to stretch out its proceedings, and give the government standing to challenge patents.
The 2011 America Invents Act created PTAB, an adversarial administrative forum for challenging issued patents. PTAB—also known as “patent death panels”—quickly got a reputation—notorious with real inventors, glowing with predatory infringers—for its high likelihood of invalidating the vast majority of patent claims these panels review.
Among other reforms, PTO Director Andrei Iancu formed a Precedential Opinion Panel. That brought some boundaries to PTAB. Mr. Iancu exercised his discretion, considering factors such as parallel proceedings on the same patents in federal courts or the U.S. International Trade Commission.
PTAB must apply factors from the precedent, Apple v. Fintiv, and deny IPRs where they would duplicate effort or waste PTO resources. The U.S. Supreme Court affirmed the PTO director’s broad, unappealable discretion in Cuozzo v. Lee and Thryv v. Click-to-Call.
Selling the AIA, advocates claimed PTAB would be a faster, cheaper alternative to patent litigation in federal court. Challengers supposedly would get one bite at the apple within one year.
It turns out PTAB has been anything but an alternative. PTAB is another layer for litigation to drain innovators of time, money and focus. It’s a means of wiping out issued patents that Article III courts would uphold as valid. The selling points were lies.
Big Tech, other predatory infringers and favored Chinese companies often challenge the same patents in both Article III courts and PTAB proceedings, serially, simultaneously and repeatedly. “Instead of being an alternative to litigation, the IPR is a common adjunct to any litigation strategy,” writes former U.S. Commissioner of Patents Robert Stoll.
RAIA further tilts PTAB in infringers’ favor. S. 2891 “would open the door further to speculative filing of IPR petitions,” Patently-O reports.
Analysis shows just why RAIA is a lavish gift to Big Tech, the Infringers Lobby and China. These predatory infringers use PTAB more than others. They weaponize PTAB to cancel the patents they infringe. Note the Treacherous Twenty includes Chinese state-backed Huawei and ZTE.
Patently-O reports that S. 2891 “would substantially limit [the] PTO Director’s discretion to deny institution [of requested PTAB proceedings].”
IPWatchdog's Gene Quinn says RAIA “would overrule Fintiv, which opens the floodgates for fresh, new rounds of patent owner harassment by challengers and without any consideration for whether another judicial officer has or will soon consider the same issue.”
PTO is part of the Administrative State, executive agencies that violate the constitutional separation of powers, holding legislative, administrative and judicial powers in-house. RAIA further entrenches the Administrative State, where fairness and due process are dishonored.
S. 2891 weakens the constitutional role of federal courts in judicial matters involving patents. RAIA expands PTAB’s judicial powers. It essentially directs the judicial branch to defer to administrative personnel (unconstitutionally) exercising judicial power.
RAIA “would reduce the power of the federal district courts and elevate the PTAB over presidentially-appointed federal judges,” notes PhRMA’s Tom Wilbur.
IPWatchdog’s Quinn explains, “Preventing the USPTO from considering what is happening in federal district court prior to deciding whether to institute can only make sense if the PTAB is intended to supplant federal district court patent litigation.”
In short, S. 2891 doesn’t “restore” the AIA; it extends the AIA regime.
RAIA heightens the hurdles of invention and investment, rendering patent property rights less and less secure and reliable. It further distorts our government by erasing lines separating judicial, administrative and legislative branches.
As we marvel at the role IP has played in our nation’s progress, let’s focus on strengthening, not weakening our property rights.
James Edwards, Ph.D., is executive director of Conservatives for Property Rights (@4PropertyRights) and patent policy advisor to Eagle Forum Education & Legal Defense Fund.