With the enactment of the America Invents Act in 2011, came the creation of the Patent Trial and Appeal Board and new administrative avenues for post-grant review of patent validity.
The PTAB has since elicited varied reactions, from being criticized by some as a “death squad” for patents, to being hailed by others as offering up faster and more cost effective proceedings than traditional district court patent litigation.
At the IP Dealmakers Forum in New York City on Thursday, in-house lawyers from Uber Technologies Inc. and International Business Machines Corp. offered up their opinions on the administrative tribunal.
From IBM senior counsel Marian Underweiser’s perspective, there’s a quality problem in the PTAB in that the processes sometimes result in unfair judgments for good faith patentees. “I certainly think the right thing is to have the front end work, have those patents as likely to be of high quality, to be valid, as possible,” she said. But when a patent that’s the subject of litigation ends up at the PTAB, “in a very large percentage of cases, all or some of the claims are found invalid,” she said.
“Does that seem like where we wanted to be going with these procedures?” Underweiser questioned. “The way the results come out now, I don’t think reflect…what we think the patent system is supposed to be doing.”
Former Federal Circuit Chief Judge Paul Michel added that while PTAB proceedings, particularly inter partes reviews, are characterized as being cheaper and faster alternatives to district court litigation, the reality is that “they’ve just become the prelude to the district court, so the majority of cases get stayed while the PTAB proceeding goes forward.”
This, in turn, delays the process and adds to the costs, in Michel’s view. “So we’ve moved in exactly the wrong direction, and in a way [that's] contrary to the expectations and the intent of Congress as reflected by the legislative history,” he said.
But panelist John Mulgrew, global head of IP at Uber, was more enthusiastic about the PTAB. Mulgrew, who was formerly associate general counsel at Microsoft Corp., said part of his job in the 10 years he was at Microsoft was to defend the company against assertions made by other companies, both in the pre-litigation phase and in litigation.
“It’s one of the most infuriating jobs I ever had because most of the claims that were asserted against the company were ridiculous,” Mulgrew said. “I was longing for a procedure like IPR, and it did not exist.”
Questioned later by an audience member about his perspective, Mulgrew commented that it’s a “reaction to sort of an abuse of the system.” A number of times, Mulgrew explained, he’s been confronted with a situation in which someone took advantage of the fact that it would be more cost efficient to settle a claim of patent infringement than to defend against it.
“The ability to settle because it’s going to cost you more to litigate is wrong, that’s just wrong. That’s a broken system,” he said. “I’m not saying AIA was perfect, [but] you need something to address that problem.”