PTAB Bar Association Annual Meeting
Director of the U.S. Patent and Trademark Office Andrei Iancu
September 24, 2020
As prepared for delivery
Thank you, Naveen, for the kind introduction. Thank you to the PTAB Bar Association for bringing us together over the digital networks, made possible, by the way, by many inventors who have been granted patents by the USPTO.
I hope you are all staying healthy and safe. During these challenging times, we are focused more than ever before on enhancing the American system of innovation.
We are adopting new and innovative programs and policies aimed at accelerating innovation, simplifying patenting, and developing a new generation of passionate and determined inventors. We want many more people to understand the importance of patents to the renewal of the American economy. All of us in the PTAB community will benefit from our efforts to broaden the community of inventors, and by our engagement with larger segments of the American population.
We are committed to protecting the intellectual property rights of those individuals – the innovators – who take great risks to develop new technologies and products that transform the American economy and global society.
I am pleased to report that both the USPTO and PTAB are making tremendous strides in transforming operations to keep up with the challenges confronting individuals and companies engaged in innovation. We are focused on continuously improving our operations and meeting milestones needed to achieve our goals.
Two years ago, I said that there is “a new day at the PTAB.” And indeed it is. There are a number of examples of the Board’s transformation, but I would first like to highlight two brand new initiatives that we implemented over the summer.
The first is the acceleration of ex-parte appeals for appellants through the Fast-Track Appeals Pilot Program. The Fast-Track Appeals Pilot is limited to 125 granted petitions per quarter, or 500 total for the fiscal year. We set these limits in order to encourage participation without compromising other PTAB goals, such as pendency of ex parte cases overall. We expect these appeals to be decided in about half the time of a normal-track appeal.
Meanwhile, pendency for normal-track appeals has itself been steadily improving over recent years. Today, appeal pendency is approaching an average of 13 months from docketing. That is down substantially from the 30 months it took us on average to decide an appeal in 2015. This is amazing progress; a true accomplishment. And we want to maintain that momentum. Kudos to Chief Judge Boalick, Deputy Chief Judge Bonilla, and the entire PTAB team.
The second initiative was the recent launch of the Legal Experience and Advancement Program — or better known as “LEAP.” Our intention is to help train and mentor the next generation of top-notch IP lawyers. As we all know, the demands on a patent lawyer are not trivial. Patent law is a complicated area of jurisprudence. It is also apparently in a constant state of flux. LEAP provides new lawyers with the opportunity to hone their skills in oral argument by providing them with more time to make their case. It also provides them with direct access to senior lawyers who are on standby to assist them during a hearing.
The program is also unique in that it enables newer lawyers to receive training directly from PTAB judges. Our judge-led training provides guidance on intricate PTAB hearing procedures, including the use of demonstratives, and the appearance of remote judges. And our judges can provide new lawyers with approaches to advocacy that are unique to AIA trials and ex parte hearings. Yes, LEAP is for ex parte hearings too!
This program is clear evidence of our commitment to fortify the essential innovation infrastructure of our country and ensure its continuity long into the future. I invite everyone to check out our dedicated LEAP webpage, which you can access from the PTAB home page.
Another PTAB transformation that we have been working on for a few years is the increased balance in AIA trials. As with many other IP issues, balance is so critically important for these proceedings. On the one hand, the AIA statue was intended for a petitioner to be able to choose a faster, cheaper alternative to district court litigation. On the other hand, Congress cautioned against repeated challenges to a patent, and against the harassment of patent owners.
To quote from the 2011 House Report on the AIA: “In utilizing the post-grant review process, petitioners, real parties in interest, and their privies are precluded from improperly mounting multiple challenges to a patent….” The same AIA legislative report “recognizes the importance of quiet title to patent owners to ensure continued investment resources.” It added that AIA proceedings “are not to be used as tools for harassment or as a means to prevent market entry through repeated litigation and administrative attacks on the validity of a patent.”
In the first years after passage of the AIA, however, a practice had developed of challenging the same patents repeatedly. And the types of these multiple challenges themselves multiplied over time, and started to come in various forms: serial petitions, parallel petitions, petitions duplicative of pending district court litigation, and more.
Such repeated challenges turned certain IPRs from their intended purpose – a cheaper, faster alternative to district court litigation -- into the exact opposite – lengthier, more costly, repetitive litigation. Instead of streamlining patent litigation, in other words, some IPRs may lead to additional, prolonged litigation. This is not the bargain struck in the AIA. This is not what Congress intended.
So to restore the appropriate balance, we have worked to avoid multiple challenges to the extent possible. Specifically, we carefully studied the many cases that came before us and developed a series of flexible considerations to guide the Board in its determinations as to whether a petition should be denied because it is repetitive.
To be clear, various Board panels had been rejecting repetitive challenges for some time. But because there was no unified approach, different panels did different things over time. Our precedential and informative decisions synthesize what we have learned over the past decade and provide guideposts in order to increase consistency and predictability of these analyses.
These decisions have successfully restored balance and reduced repeated challenges. Through the General Plastic factors, we have essentially eliminated serial petitions – that is, multiple petitions filed against the same patent, one after another, in series. We have also drastically reduced parallel petitions – that is, multiple petitions filed against the same patent at about the same time.
There is also another form of repetitive challenge that has received a lot of attention lately. And that is: what to do if the petitioner is challenging validity of the same patent under substantially the same arguments both at the PTAB and in District Court, and the court is far ahead of the PTAB?
Turning back to my earlier points, AIA proceedings were meant to be a faster, cheaper alternative to the district court. However, sometimes – rarely as it turns out – the courts are faster than the PTAB. Adding a PTAB proceeding in this situation would mean that the PTAB would issue a decision after the district court. In this situation, a PTAB proceeding would be slower than the court and result in more expensive litigation. And, if the petitioner litigates the same issues in both fora, a PTAB case would repeat proceedings instead of allowing for an alternative.
Take, for example, a jury trial that ends before the PTAB can even institute. An IPR at that point, by definition, cannot be faster – it would be at least 12 months longer. It cannot be cheaper – the district court case is essentially done, the money is spent, so the PTAB can only add to the expense. And it usually cannot be an alternative – if the issues are the same, it is only an after-the-fact administrative check on an Article III Court, setting up the possibility of inconsistent results to boot. In such a situation, the only reason left for a PTAB case is a guaranteed second bite at the apple.
My example, where trial in the district court is actually finished before we can even make an institution decision, is quite rare indeed – although it does happen every now and then. But the same issues arise if the court trial is imminent and will take place well before we can reach a final written decision.
In some of these cases, PTAB panels had previously exercised discretion not to institute an IPR. But each panel was essentially making these decisions on its own. These cases were collected and analyzed by the panel in the Apple v Fintiv case, which created a consistent framework for analysis across the Board, balancing a set of six factors. With these factors in mind, we can minimize the “repeated litigation and administrative attacks on the validity of a patent” that Congress warned about, and the PTAB can instead continue to focus on being the faster, cheaper alternative to district court litigation that Congress intended.
This also minimizes the potential conflict with co-pending court cases that are in an advanced stage and will likely not be stayed. We must be mindful of the fact that courts typically review administrative decisions, and not the other way around. The PTAB, as an administrative body, should act with humility and restraint in the face of a prior decision by an Article III court.
And we should also act within predictable guidelines. This is precisely what we have done with our various precedential and informative decisions.
In the end, and as Congress intended, a petitioner can choose the PTAB as an alternative to district court litigation. But Congress did not assure petitioners of repeated, prolonged litigation on the same issues, and gave the PTO discretion to prevent it. That was the statutory balance agreed upon. And that is the balance we have restored.
By the way, this restored balance has helped our patent system regain its place at the top of worldwide rankings. As stewards of a patent system that is truly the envy of the world, we must be unwavering and steadfast in maintaining a post-grant review system that is faithful to the statute, and is also balanced and fair to all parties: petitioners, patent owners, and the public.
Our patent system is a crown jewel, the gold standard. Our patent system, born from the Constitution and steeped in our history, is the reason why the United States is able to remain a world leader in so many ways. It is the system upon which the United States depends to generate the economic growth and prosperity required of a modern society. Our patent system, which democratized invention, is essential to achieving the American Dream for millions of people from all walks of life. We are its guardians. It is up to us to build the strongest IP system possible – today, tomorrow, and for the many generations to come.
Thank you, again, to the PTAB Bar Association for hosting this meeting, and for all you do to support our remarkable patent system. Thank you for inviting me to be here with you today. I look forward to our discussion.