“While it’s good to see that some attention is being paid to creating a level playing field for patentees at the PTAB through estoppel and encouraging claim amendments, the Day One Project certainly didn’t give those proposals the level of detail that pro-petitioner policies like increasing the grounds for invalidation in IPR received.”
Recently, the Day One Project, an initiative of the Federation of American Scientists, released a transition document drafted by a collection of veteran policymakers discussing a range of policy ideas to be implemented at the U.S. Patent and Trademark Office (USPTO) starting from the earliest days of the Biden Administration. The ideas advocated by the Day One Project focus on a mix of policies related to diversity, international IP systems, patent quality, agency budgeting and governance and ways that the USPTO can contribute to broader administrative policy initiatives. The full list of contributors to the project is available here.
While there are many sound policy positions advocated by the Day One Project, patent owners may want to be aware of the document’s stance on the “public benefit of PTAB review of a patent” as well as the agency’s role in developing policy on patentable subject matter reform. Interestingly, the policy document indicates that there is broad consensus for continuing policies from the Trump Administration relating to China’s influence on the world of intellectual property.
Patent Quality Proposals Focus on Maintaining ‘Public Benefit of PTAB Review’
The transition document’s cover memo indicates that top policy priorities for the USPTO will include “the need to achieve balance” by “balanc[ing] incentives for innovation with access to new technologies… [C]ontinued efforts to improve and maintain patent quality will be USPTO’s most important day-to-day contribution to America’s innovation economy.” While there’s no sense that the Biden Administration will release its pick for USPTO Director any time soon, the suggested policies represent what the document’s collaborators believe were policy areas that the next Director could address immediately.
“There is broad consensus that the PTAB is a useful tool to reduce issues for litigation and increase business certainty,” according to the Day One Project transition document, although it’s hard to determine how the PTAB increases business certainty for many patent owners who have dealt with harassing multiple petitions preventing their ability to enforce patent rights against alleged infringers with deep financial resources. Duke University School of Law Professor Arti Rai proposed that the new USPTO regime work with Congress to pass legislation establishing PTAB administrative patent judges (APJs) as inferior officers to answer questions raised by Arthrex v. Smith & Nephew, which is currently at the U.S. Supreme Court.
Stephen Yelderman, Associate Professor at Notre Dame Law School, suggested various non-merits factors that could be considered by PTAB APJs when deciding whether to institute a petition for inter partes review (IPR), including the age of the patent, the value of the commercial market relevant to the patented technology and the patent’s prior litigation history. “These factors are not spelled out in 35 U.S.C. §311 et seq., but the Director likely has (unreviewable) discretion to consider such factors in IPR grant decisions,” Yelderman’s proposal reads. He adds that these factors could become more important in decisions if PTAB resources constrain the number of IPRs that can be granted by the Board. A proposal from Loyola Law School Professor Justin Hughes suggested that USPTO leadership work with Congress to increase the grounds for invalidation in IPRs to cover Section 112 enablement and double patenting issues.
In addition to those PTAB proposals, the Day One Project’s transition document suggests that the next USPTO Director should be prepared to explore several other PTAB ideas including the creation of a reexamination off-ramp for amending claims, expanding estoppel provisions and achieving better coordination between the PTAB and district court. While it’s good to see that some attention is being paid to creating a level playing field for patentees at the PTAB through estoppel and encouraging claim amendments, the Day One Project certainly didn’t give those proposals the level of detail that pro-petitioner policies like increasing the grounds for invalidation in IPR received. That alone would give many patent owners reason to be discouraged by the Day One Project’s overall policy proposal.
Section 101 Proposal May Indicate Willingness to Change Course on Iancu Reforms
Yelderman also drafted a proposal on patentable subject matter reform policy that may signal an effort to reconsider efforts made by Director Iancu to bring more clarity to Section 101 issues. After acknowledging the large number of U.S. Supreme Court certiorari denials on Section 101 questions and legislative efforts to fix Section 101 eligibility, Yelderman notes that “a new Congress and a new President would have a fresh opportunity to address these issues.” Yelderman suggests that the agency’s engagement on Section 101 should involve hosting roundtable discussions, preparing comprehensive reports on various perspectives on Section 101, as well as collecting information on patent eligibility standards internationally in Europe, Japan, China and Korea. While Yelderman’s proposal doesn’t express a viewpoint on whether Section 101 eligibility should be expanded or constricted, his openness to changing course on much of Director Iancu’s work in that area cannot be welcome news to many practitioners who have welcomed Iancu’s guidance on Section 101.
Another Arti Rai policy proposal regarding patent quality would increase collaboration between the USPTO and other federal agencies like the Food & Drug Administration (FDA) and the U.S. Department of Energy (DOE) to increase prior art references for use by patent examiners during prosecution. Yelderman and Santa Clara University School of Law Professor Colleen Chien were part of a group proposing that the USPTO should de-identify patent applications to reduce potential gender- or race-based examiner biases. Former USPTO Acting Director Teresa Rea and Former USPTO Deputy Director Sharon Barner advocated for a pilot program designed to to increase work sharing arrangements among Big 5 patents offices including the USPTO, European Patent Office, Japan Patent Office, Korean Intellectual Property Office and China’s National Intellectual Property Administration. Such an effort could improve prior art identification and reduce the amount of time examiners spend prosecuting patent applications.
‘Broad Consensus’ in Favor of Trump’s IP Policies on China
While many Biden voters may have thought that a Democratic presidential administration would have represented a complete about-face from many Trump Administration policies, “[t]here is broad consensus that U.S.-China relations cannot and should not return to their pre-2017 form,” according to Mark Allen Cohen, Distinguished Senior Fellow at UC Berkeley. However, while the incoming administration should address Chinese activities that negatively affect U.S. interests, Cohen argues that opportunities for U.S.-China collaboration still exist. He also pushes for the creation of a long-term inter-agency task force to develop coordinated responses by the federal government to Chinese IP policies. Under the Day One Project’s governance insights, collaborators observed that “[i]n a US-China relationship that will be intensely competitive in some areas and productively cooperative in others, PTO should press the new administration for guideposts on what outreach and initiatives will be appropriate.”
Several other policy areas of interest for the incoming USPTO administration are identified in the Day One Project’s transition document, including equity and diversity initiatives, USPTO budgeting and governance, international IP regimes and broader administration goals involving the USPTO. Equity initiatives include mandating information collections on patent applicant demographics, which would be firewalled from the agency’s examination workforce, and developing more incentives for minority inventors. Budgeting and governance proposals cover raising initial fees to account for declines in maintenance fees and reduce fraudulent filings, recalibrating patent maintenance fees to “encourage patent holders to further assess patent value and thereby move some innovations into the public domain more quickly,” establishing a Bureau of Economics within the USPTO and pursuing legislation to give the USPTO substantive rulemaking authority.
While the Day One Project’s international IP policy proposals include a good deal of focus on China, collaborators also advocate for exploring opportunities at the World Intellectual Property Organization’s Intergovernmental Committee for achieving consensus on international patent issues, increasing cross-agency collaboration on digitized genetic sequence information, and giving the USPTO authority to recommend international IP Attachés for counselor status with foreign governments based on individual experience and qualifications. Several other policy proposals for interacting with broader administration initiatives include convening a cross-agency task force on drug pricing; developing more robust systems for using USPTO data; establishing a small claims court for patent infringement similar to the UK’s Intellectual Property Enterprise Court; expanding the Patents for Humanity award program for inventors addressing global humanitarian concerns; prioritizing global access to medicines in international trade negotiations; and creating Blue Ribbon Commissions for developing comprehensive U.S. strategies on innovation and current issues with the patent system.
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