PublishedNovember 22, 2023

Correcting the Record on the PREVAIL Act

Earlier this month, the Senate Judiciary Subcommittee on Intellectual Property held a hearing to discuss Reforming the Patent Trial and Appeal Board – The PREVAIL Act and Proposals to Promote U.S. Innovation Leadership. Back in June, after the PREVAIL Act was introduced, I noted that “in practice, the PREVAIL Act would severely limit access to PTAB (Patent Trial and Appeal Board) review and make it more difficult to challenge invalid patents on their merits” and that “the legislation appears to primarily be a response to oft-repeated assertions by certain interest groups that patent owners – particularly small patent owners – face repeated harassment through coordinated validity challenges and that current review practices create opportunities for abuse by petitioners.”

Unsurprisingly, but troublingly, during the hearing lawmakers and witnesses touted several longstanding misconceptions about how the PTAB operates, including the patent owner harassment. Another claim that featured heavily during the hearing is that the PTABkills” patents at extremely high rates. The oft-repeated phrase “patent death squad” wasn’t mentioned, but the sentiment was there. 

This summer, Senator Coons’ office released a factsheet about the PREVAIL Act citing that, “about 80 percent of instituted PTAB proceedings that reach a final written decision result in the invalidation of at least one challenged patent claim, with 65 percent of those proceedings resulting in the invalidation of all challenged patent claims.” This data point helps fuel the “death squad” story, but it’s a misleading number. In order for a review to be instituted a PTAB petition already must show a “reasonable likelihood” or, depending on the circumstances, “compelling merits” that a patent is invalid—a threshold inquiry where nearly half of petitions fail. Therefore, petitions that make it to a PTAB trial stage have already been deemed, by experts, to likely be invalid. Only looking at the final written decision data heavily skews the figures in one direction.

I was pleased to hear one witness Michelle Armound, Founding Partner of Armond Wilson, correct the record during her oral testimony. Michelle cited the Patent Office’s 2023 End of Year Outcome Round Up for IPRs and PGRs, and explained, “There is a perception that the PTAB is just there killing patents and if you actually look at the numbers it’s actually a pretty balanced resolution…there is a 59% win rate for patent owners and I think that is really good news.” A pretty good win rate for a process that supposedly overwhelmingly kills patents.

Armound’s 59% is not the only way to slice the data that shows the PTAB “death squad” assertion is not based in reality. According to USPTO data, between September 16, 2012 and September 30, 2022, 8,578 patents were challenged in America Invents Act proceedings. Out of those challenges, 2,749 were partially invalidated and only 870 were fully invalidated by the PTAB. Do the math and only 10% of petitions have been completely invalidated. Further, only 26% of challenged claims and 53% of instituted claims were found unpatentable in FY2022 and only 33% of challenged patents had one or more claims deemed unpatentable. All of this is a far cry from the “death panel” rhetoric that’s been perpetuated by some interest groups.

As lawmakers continue to debate the PREVAIL Act, it is my hope that we can all start from a place of agreeing on some foundational data about how the PTAB has been operating over the last decade-plus. Until then, advocates on both sides of the issue will be speaking past and not with each other. In order to have a productive conversation, key PTAB misconceptions need to be put to bed.  

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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