The America Invents Act (AIA) has made a number of changes in the way patent disputes are resolved. Before the AIA, there were the options of inter partes reexamination and ex parte reexamination before the US Patent Office (USPTO), and litigation in federal district court.
Under the AIA, inter partes reexamination has been eliminated. Litigation is increasingly seen as an excessively slow and expensive option.
The Patent and Trademark Appeals Board (PTAB) of the USPTO now accepts petitions to invalidate patents. The three kinds of Post-Grant Challenges (PGCs) are:
- inter partes review (IPR),
- covered business method review (CBM), and
- post-grant review (PGR).
An IPR challenge must be made within 12 months after a patent has been granted. A PGR must be sought within nine months. There is no express time limit for a CBM.
The advantages of filing a PGC v. litigation include lower costs and speed.
A PGC proceeding must be completed within 12 months after it’s initiated, although in rare cases this period may be extended to 18 months for good cause.
Also, the PTAB will apply the “broadest reasonable interpretation” claim construction standard, which resolves ambiguities in favor of broader construction. In contrast, federal district courts apply the “ordinary and customary meaning” standard. The result is that it’s easier for a defendant to invalidate a broader claim under the PGC process.
The PTAB is also considered a better place to litigate patent disputes because the administrative law judges on the board are experts in patent law. In comparison, many federal district court judges have little knowledge of or experience with patent law issues.
The PGC process can be especially valuable for large companies under siege from Non-Practicing Entities (NPEs, aka “patent trolls”) that bring multiple lawsuits and seek to settle for slightly less than the costs of litigation. Since the PGC process is cheaper than litigation, it’s a cost-effective way to fight rather than settle claims that may be of questionable validity.
