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PublishedJune 8, 2023

ANPRM’s Ex Parte Reexamination Proposals are Deeply Flawed

The U.S Patent and Trademark Office’s (USPTO) Advance Notice of Proposed Rulemaking (ANPRM) has spurred a range of commentary and criticism—mostly the latter—from current and former members of Congress, former USPTO officials, the private sector, and experts across the US patent landscape. The lengthy rulemaking proposal includes a wide range of sweeping changes, many of which appear to contradict the America Invents Act, so it is understandable that some components have received less attention than others. One topic that has flown somewhat under the radar, and deserves further discussion, are changes related to ex parte reexaminations. 

The ANPRM proposes two primary changes related to ex parte reexamination.

First, the ANPRM suggests taking away an inter partes review (IPR) petitioner’s ability to request a later ex parte reexamination. Specifically, the ANPRM proposes “requiring petitioners to file a stipulation that neither they nor their privy or real parties have filed prior post-grant proceedings (PGRs, IPRs, CBMs or ex parte reexaminations) on the challenged claims; and that if their post-grant proceeding is instituted, neither they nor their privy or real parties in interest, will challenge any of the challenged claims in a subsequent post-grant proceeding (including PGRs, IPRs and ex parte reexamination).”

When Congress wrote the AIA and created AIA trials, they knew how to set limits on what proceedings a petitioner could pursue.  These rules appear in 35 U.S.C. § 315 and § 325.  Congress was quite clear about when a petitioner was barred from pursuing an IPR—when they had previously filed a civil action challenging the patent, or after a final written decision on that patent that the petitioner was involved in.  Litigation other than a civil action challenging the patent?  Not on the list.  Ex parte reexaminations?  Also absent from the list.  Congress set the scope of what conduct would bar petitioners from filing an IPR, and the Director shouldn’t be trying to expand that list in order to protect invalid patents.  

And that’s all that’s needed—if the petitioner in an IPR wins, then obviously there’s no need for them to request an ex parte reexam.  And if the petitioner loses, then they’re barred from seeking an ex parte reexamination on any issue the petitioner raised or could have raised in the IPR.  So the only area in which a petitioner might request a reexam is if either they do it while the IPR is pending, or if they later find new and unrelated art they couldn’t previously have reasonably located which is sufficient to raise a new question regarding whether the patent is valid.

Congress thought of the simultaneous request issue, though.  In § 315(d) and § 325(d), Congress said “if another proceeding or matter involving the patent is before the Office, the Director may determine the manner in which the inter partes review or other proceeding or matter may proceed, including providing for stay, transfer, consolidation, or termination of any such matter or proceeding.”  

In other words, this provision is totally unnecessary.  It either protects a patent that shouldn’t be valid, by blocking a future ex parte reexamination on newly discovered art, or it’s just unnecessary because the Director can handle the ex parte reexamination in whatever way they feel is appropriate.  But Congress assigned that responsibility to the Director, not to petitioners, and the Director should not seek to avoid political accountability for their decisions in this way. 

Second, the ANPRM seeks to further expand the Director’s discretion to deny IPRs, to include cases where the USPTO has previously adjudicated a patent claim’s validity through an ex parte reexamination. After a discussion of parallel and prior district court cases that states “changes under consideration would provide that prior final adjudications by a district court or by the Office in AIA post-grant proceedings upholding the validity of claims that substantially overlap the challenged claims will result in discretionary denial” (except in in instances where additional standing requirements are met), the ANPRM goes on to say that “the Office is also considering whether to extend this proposal to including prior adjudications of validity through ex parte reexaminations requested by a third party other than the patent owner or the patent owner’s real party in interest or privy.” 

This is, in essence, an expansion of the USPTO’s failed NHKFintiv rule and is incompatible with current law. Again, the statute indicates that Congress considered cases where a petition for IPR is filed after an ex parte reexamination, noting that “if another proceeding or matter involving the patent is before the Office” then the USPTO may provide for “the stay, transfer, consolidation, or termination of any such matter or proceeding.” The law is plain that IPRs may be filed after ex parte reexaminations on the same patent, with the Director retaining authority to address the parallel proceedings in an accountable fashion.

In addition to being an overreach of agency power, some experts have smartly pointed out that the proposed changes to reexamination could also open up a dangerous new loophole. Ex parte reexaminations can be filed anonymously. As a result, sophisticated non-practicing entities (or any other patent owner who wished to game the system, or even the patent owner themselves) could purposely file a poor-quality reexamination petition. Under the new rules, the USPTO’s validity adjudication based on that poor-quality reexamination petition would then protect the patents in question from further post-grant scrutiny. This isn’t a new point—I made this point when testifying to Congress about the STRONGER Patents Act, which had a similar provision barring IPRs based on proceedings filed by other parties.  And you can go even further back—Thomas Jefferson explained why this sort of provision is a bad idea in 1791!

For an agency that is seeking to make rules consistent and discourage attempts to game the system, this appears to be a significant vulnerability. 

The more you peel back the ANPRM’s layers, the more problems you find. Ex parte reexamination hasn’t been the largest topic of discussion to date, but it deserves attention alongside issues like new standing requirements and higher review thresholds.

Josh Landau

Patent Counsel, CCIA

Joshua Landau is the Patent Counsel at the Computer & Communications Industry Association (CCIA), where he represents and advises the association regarding patent issues.  Mr. Landau joined CCIA from WilmerHale in 2017, where he represented clients in patent litigation, counseling, and prosecution, including trials in both district courts and before the PTAB.

Prior to his time at WilmerHale, Mr. Landau was a Legal Fellow on Senator Al Franken’s Judiciary staff, focusing on privacy and technology issues.  Mr. Landau received his J.D. from Georgetown University Law Center and his B.S.E.E. from the University of Michigan.  Before law school, he spent several years as an automotive engineer, during which time he co-invented technology leading to U.S. Patent No. 6,934,140.

Follow @PatentJosh on Twitter.

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