Navigating Patent Litigation Changes: Update on the America Invents Act

In Issue 3 of IP Insights, we discussed the Inter Partes Review (IPR) process at the United States Patent and Trademark Office (USPTO) since the Leahy-Smith America Invents Act (AIA) was signed into law. The AIA was approved as part of an effort to improve the quality of the patents issued by the USPTO, to allow for patent validity challenges to be heard in front of a panel of judges from the USPTO at the Patent Trial and Appeal Board (PTAB), and to help alleviate the backlog of patent validity cases in the district courts.

Three years later, how has the PTAB affected district court litigation?

Initially, the USPTO projected that approximately 420 patent challenges would be filed annually through the IPR process at the PTAB. However, since the effective date of September 2012 through September 2015, almost 3,600 IPR petitions have been filed. In 2015 alone, filings averaged more than 140 per month. The number of IPR petitions has nearly doubled annually since inception, from 17 petitions in 2012 (which represents only one-quarter of the year, since the effective date was September 2012) to over 1,700 petitions for the fiscal year ended September 2015:

The primary reason for this significant increase in PTAB IPR petitions appears to be the expedited process to resolution. The average length of time to a district court trial is approximately 30 months, but can vary widely. In contrast, once the PTAB institutes trial on an IPR petition, resolution is generally expected to be completed within one year.

Another important factor when considering the filing of an IPR is the historical trial results. Of the almost 3,600 IPR petitions filed, how have these petitions been resolved by the PTAB?

In the first two years of the PTAB’s existence, about 70 to 80 percent of challenged patent claims were canceled. According to USPTO statistics (as of September 2015), there have been approximately 1,000 trials instituted by the PTAB out of approximately 2,100 IPR petitions completed to date (the remaining IPR petitions are still waiting for a decision on whether trial will be instituted). Of the trials instituted, 575 trials were completed and a final written decision was reached (the remaining trials were terminated due to settlement, dismissal, or request for adverse judgement). Of those 575 written decisions, approximately 72 percent (414 decisions) concluded that all instituted claims were unpatentable, invalidating the challenged patent. An additional 85 decisions (of the 575 trials) returned a decision that some claims were unpatentable. As a result, only 13 percent of final written decisions affirmed the validity of all asserted claims of the challenged patent.

Gleason IP’s Role in AIA Cases

With the increasing use of IPR under the AIA in patent litigation, Gleason IP can help clients navigate the PTAB review process and assist clients with economic issues such as objective indicia of nonobviousness, including analyses of commercial success and nexus. Our experience providing analysis and expert testimony related to secondary considerations of nonobviousness in connection with IPR proceedings at the PTAB, as well as within numerous district court matters, including working several times directly on behalf of the USPTO, positions us well to provide expert analysis and testimony within IPR proceedings.

Sources:

Patent Trial and Appeal Board Statistics, 9/30/2015

Shuchman, Lisa. “Patent Litigation Will Never Be the Same Again.” Corporate Counsel, October 26, 2015.