inter partes proceedings

Supreme Court IPR Decisions Present Strategic Challenges to Patent Owners and Accused Infringers

The Supreme Court issued two significant decisions on the same day, both of which concern Inter Partes Reviews (IPRs), the administrative procedure to challenge patent validity.  Since their creation, IPRs have been a potent tool for those accused of patent infringement to challenge patent validity while avoiding the expense and burden of district court litigation. 

 In Oil States Energy Services v. Greene’s Energy Group, the Court rejected a constitutional challenge to the IPR regime, finding that because patents are public rights, Congress may allow them to be reviewed and invalidated by a non-court proceeding. 

 In SAS Institute v. Iancu, the Court held that once an IPR is instituted, the PTO must issue a decision as to all patent claims that are challenged – it cannot decide to pass on some claims and avoid others. 

 Both cases will have an important impact on patent litigation practice.

 Oil States means that IPRs will continue to be a significant, and often effective, tool in patent disputes. 

 SAS Institute will impact how parties petitioning for IPRs should structure their petitions.  Before SAS Institute, a part could petition for review of all claims in a patent, and rely on the PTAB to initiate the procedure only on the most promising claims.  But the decision in SAS Institute requires careful strategic thinking to determine whether to challenge all or just some of the claims in a patent.

New Patent Ploy: Let’s Make a Deal with an Indian Tribe

Companies involved in patent disputes should be aware of a new tactic they may either face or wish to employ.  Some patent owners have recently utilized a new strategy to avoid inter partes proceedings (IPRs) in the Patent Office. The strategy: sell (and then obtain a license back) the patents to an Indian tribe, retaining all marketing rights, and then assert that tribe’s sovereign immunity to avoid an IPR.  At least two patent owners have revealed their implementation of such a strategy in recent filings, which has seen significant push-back from both the courts and Congress. 

If you are a patent owner who expects heavy litigation on your patents, you might wish to consider using a similar strategy.  If your company regularly faces claims of patent infringement (by competitors or patent trolls), then be prepared to have such a strategy employed against you by a patent owner.