New Rule Improves Patent Challenge Proceedings for Patent Owners

The U.S. Patent and Trademark Office (PTO) this week published a final rule change that will significantly improve the fairness of post-issuance patent challenge proceedings, such as Inter Partes Review (IPR), for patent owners.

This change replaces the controversial “broadest reasonable interpretation” (BRI) standard – under which a patent being challenged is more likely to be struck down – with the more narrow and reliable claim construction standard used to construe claim terms in federal courts. This is a policy change that BIO has advocated forever since the BRI standard was adopted for post-issuance proceedings in 2012.

In July, BIO submitted comments to the PTO in support of the proposed revisions to the standard for construing disputed claim terms in IPRs, as well as post-grant reviews and covered business method reviews (collectively, “post-grant proceedings”).

Post-grant proceedings were intended to be an alternative to district court litigation to address patentability and validity. However, the vast majority of patents that are the subject of post-grant proceedings – over 80% – are or were involved in parallel district court litigation.

This action by the PTO will help ensure that patent claims are construed consistently, whether they are reviewed by the PTO, a federal court, or the International Trade Commission. In its final rule, the PTO decided to apply the rule change only prospectively to all petitions filed after Nov. 13, 2018.

Why this matters: The PTO is to be commended for removing an inherent unfairness in the current system that disfavors patent owners and encourages gamesmanship by patent challengers. Its action will increase the efficiency and consistency of patent reviews, better utilize administrative and court resources, reduce incentives for redundant litigation, and provide greater predictability for patent owners. More broadly, this latest action signals a continuing positive trend by the new PTO leadership to rein in abuses of the IPR system and make the system more fair for patent owners.

Grace Appelbe
[email protected]
Manager, External Relations
Biotechnology Innovation Organization

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