By Masa Yokoyama & Scott Daniels
With the enactment of the AIA in 2011, ex parte reexamination was overtaken by the newly created inter partes (IPR) and post-grant (PGR) review proceedings, as a preferred means of challenging the validity of issued patents at the Patent Office. This early “relegation to the backseat” was not entirely justified since reexamination offers a number of advantages over the AIA review proceedings.
Indeed, ex parte reexamination has made something of a comeback in recent years as many practitioners have rediscovered its advantages. This renewed appreciation of reexamination is likely to increase with more and more Patent Office decisions like the recent final rejection of the challenged claims in U.S. Patent No. 10,259,470 (Reex. No. 90/015,287). The ‘470 patent claims “a vehicle control system” for high-risk drivers, which comprises “operating profiles” that “can be loaded to a driver identification and data logging module in conjunction with a remote computer,” so that “a master control” operates “the vehicle within the desired operating profile.”
The owner of the ‘470 patent had sued Honda, Kia, Mercedes, Toyota, and State Farm Insurance in the Easter District of Texas for infringement. Two of those lawsuits appear to have settled. The other three are still pending but might soon be stayed in light of the final rejection of the challenged ‘470 patent claims.
Of course, the ‘470 patent reexamination is not over since the patent owner may try to persuade the Examiner to enter claim amendments that patentably distinguish over the prior art or to appeal the final rejection. Still, the patent owner’s likelihood of success at this late stage might be remote.
Regardless of the eventual outcome of the ‘470 patent reexamination, the progress of the proceeding to date illustrates some of the advantages of reexamination. Most notable are (i) the great length of the reexamination request (far longer and more comprehensive than the length permitted for an IPR or PGR petition), (ii) the speed with which the Examiner issued the final rejection (less than nine months after filing date of the reexamination request), and (iii) the requester’s option to remain anonymous.
Ex parte reexamination also appeals to challengers because Examiners apply the “broadest reasonable construction” standard, rather than the “common and ordinary meaning” standard used in IPRs and PGRs, with the result that reexamined claims are construed broadly, making the challenged claims more vulnerable to attack. This broad construction may explain, in part, the very high grant rate for reexamination requests. Whereas the institution rate for IPR/PGR petitions has declined from around 85% in 2013 to around 60% today, the grant rate for reexamination requests has held steady over the same period at around 95%.
There are also, however, disadvantages of reexamination, not the least of which are that (i) the challenger may participate in the proceeding after filing its request in only very rare and limited circumstances, (ii) the only grounds for rejection are under 35 U.S.C. §§ 102 and 103 based on patents or other printed publications, and (iii) the patent owner has a much greater opportunity to amend its claims to overcome the prior art references than in IPRs and PGRs.
Which procedure is more effective in ultimately invalidating patent claims? Reexamination or IPR/PGR? A precise answer is impossible because of the complex procedural differences between the two types of proceedings. After reading through hundreds and hundreds of file histories, we can say with confidence that each type of proceeding has its advantages and disadvantages. We can also say such challenges at the USPTO are far likely to succeed than the same invalidity arguments presented in District Court or the U.S. International Trade Commission.
Practitioners’ Takeaway:
Each case is different. Practitioners challenging the validity of an issued patent at the Patent Office must therefore balance all the plusses and minuses of ex parte reexamination and then choose wisely.
Challenging the validity of a patent at the USPTO by reexamination and IPR/PGR is far more effective than pursing the same invalidity arguments in a trial in District Court or the U.S. International Trade Commission.
