Friday, May 9, 2014

Death Panels and Patents

Reports of the death of the U.S. Patent System might be a bit exaggerated.  As some readers might be aware, the America Invents Act vested the Patent Trial and Appeal Board (PTAB) with authority to conduct post-patent-issuance validity proceedings.  In its early proceedings, the PTAB has invalidated patents at an astonishing rate of 76%Chief Judge Rader likened the PTAB to “death squads killing [patent] rights.”

The first word of caution for patent applicants is that, unfortunately, some patent practitioners do produce garbage.  I see these “bad” applications frequently.  Worse still, some Patent Examiners are asleep at the switch and allow these bad applications to issue.  The fatality rate might therefore reflect defendants taking a relatively inexpensive route to invalidate patents that desperately deserve euthenasia.  This strategy should be compared to paying “go away” money to appease the owners.  Moreover, invalidating bad patents would be a good thing for all (but the owners).  No statistics, though, are available yet to validate/disprove this theory.

So, what should entrepreneurs do?  First, a well-written application presents the best defense against invalidity no matter who hears the challenge (PTAB or not).  The days when making-do with second string patent drafters ought to be over.  Instead, the onus should be on innovators to hire well-qualified Patent Attorneys.  And many Patent Attorneys should up their game.

Furthermore, if this threat is actually as bad as it seems, then someone will challenge the PTAB.  But, that action will take years to wind its way through the appeal system.  That means that, in the meantime, entrepreneurs should continue filing patent applications when warranted.  In that way, when/if the challenge succeeds (or the PTAB comes around) smart entrepreneurs will be positioned to reap the benefits. 

We at the Villhard Patent Group would welcome the opportunity to discuss the specifics of your situation.  For more information about us see or call us at 512-897-0399.  We look forward to hearing from you.