WEBVTT
1
00:00:02.080 --> 00:00:05.080
Welcome to fedsoc Forums, a podcast of the Federal Societies
2
00:00:05.120 --> 00:00:08.279
Practice Groups. I'm Ny kas Merrick, vice President and Director
3
00:00:08.320 --> 00:00:09.039
of Practice.
4
00:00:08.759 --> 00:00:10.039
Groups at the Federal Society.
5
00:00:10.240 --> 00:00:13.800
For exclusive access to live recordings of fedsock form programs,
6
00:00:13.919 --> 00:00:17.160
become a Federal Society member today at fedsoc dot org.
7
00:00:18.120 --> 00:00:22.199
Hello everyone, and welcome to this Federalist Society virtual event.
8
00:00:22.600 --> 00:00:25.559
My name is Sarah Clark, and I'm Assistant director of
9
00:00:25.559 --> 00:00:29.320
Practice Groups with the Federalist Society. Today we're excited to
10
00:00:29.359 --> 00:00:33.840
host his fedsoft forum called which Path for Patent Challenges,
11
00:00:34.320 --> 00:00:40.039
the USPTOS one Challenge, MPRM for Inner Parties Review. We're
12
00:00:40.200 --> 00:00:43.679
very pleased to welcome our moderator, Robert Randa, who is
13
00:00:43.719 --> 00:00:47.039
a partner at Patrick Door, where he brings over three
14
00:00:47.159 --> 00:00:51.600
decades of experience and intellectual property law. If you'd like
15
00:00:51.679 --> 00:00:55.200
to learn more about today's moderator or speakers, her full
16
00:00:55.240 --> 00:00:58.520
bios can be viewed on our website fedsock dot org.
17
00:00:59.200 --> 00:01:02.359
Throughout the program, we'll turn to the audience for questions.
18
00:01:02.719 --> 00:01:05.000
If you have a question, please enter it into the
19
00:01:05.040 --> 00:01:07.959
Q and A function at the bottom of your zoom window,
20
00:01:08.359 --> 00:01:10.840
and we'll do our boss to answer as many as
21
00:01:10.879 --> 00:01:14.680
we can. Finally, I want to know, as always, all
22
00:01:14.719 --> 00:01:18.560
expressions opinion today are those of our guest speakers, not
23
00:01:18.640 --> 00:01:22.519
the Folleralist Society. Without mister Randa, thank you so much
24
00:01:22.519 --> 00:01:25.200
for joining us today and I'll hand things over to you.
25
00:01:25.840 --> 00:01:27.319
Thank you, Sarah.
26
00:01:27.439 --> 00:01:29.640
I'd also like to thank the Federalist Society for the
27
00:01:29.680 --> 00:01:33.280
opportunity to participate at the moderator of what will undoubtedly
28
00:01:33.359 --> 00:01:37.400
be an informative and insightful discussion about the recent USPTO
29
00:01:37.560 --> 00:01:42.840
Notice of Proposed Rulemaking or MPRM change is to institution
30
00:01:43.079 --> 00:01:46.719
into Parties Review or IPR before the p TEN. I
31
00:01:46.799 --> 00:01:50.519
now have the distinct honor and privilege to introduce our panelists.
32
00:01:50.560 --> 00:01:52.120
In the interest of time, I will keep you the
33
00:01:52.120 --> 00:01:55.319
introduction brief as you would see from their extended bios
34
00:01:55.760 --> 00:01:59.239
that are available everywhere bios are available. Each panelist is
35
00:01:59.280 --> 00:02:02.079
so accomplished that their full bios would fill a large
36
00:02:02.079 --> 00:02:02.760
part of the hour.
37
00:02:03.159 --> 00:02:04.959
So first we have Andre A. Ingkoup.
38
00:02:05.200 --> 00:02:08.360
Andre is a former Under Secretary of Commerce for Intellectual
39
00:02:08.360 --> 00:02:11.599
Property and Director of US Patent and Trademark Office during
40
00:02:11.639 --> 00:02:14.479
President Trump's first term in office. He is currently a
41
00:02:14.479 --> 00:02:17.039
partner at Solomon and Cromwell and one of the leading
42
00:02:17.159 --> 00:02:21.280
voices in intellectual property law and innovation policy.
43
00:02:21.919 --> 00:02:24.319
Next we have David W. Jones.
44
00:02:24.520 --> 00:02:27.479
David is the executive director of High Tech Inventor's Alliance
45
00:02:27.520 --> 00:02:31.639
for HTIA. Prior to HTIA, David was an assistant was
46
00:02:31.719 --> 00:02:35.479
Assistant General Council for Patent Policy at Microsoft. Prior to that,
47
00:02:35.520 --> 00:02:38.960
he held multiple position on Capitol Hill. He also clerked for
48
00:02:39.000 --> 00:02:41.680
the former Chief Judge Sharon Pross on the Federal SEARCHUS
49
00:02:42.080 --> 00:02:45.639
and Judge Will Gowarod on the Fifth Circuit. Next we
50
00:02:45.759 --> 00:02:49.479
have Joseph Mattal. Joseph is the principal at clear IPLLC.
51
00:02:49.919 --> 00:02:53.120
He has served as both the USPTO Acting Director and
52
00:02:53.599 --> 00:02:56.439
Acting Solicitor. Prior to that, he served in the senior
53
00:02:56.520 --> 00:02:59.000
legal roles from more than a decade for the US
54
00:02:59.039 --> 00:03:03.080
Senate Judiciary Committee, and in that capacity he negotiated and
55
00:03:03.159 --> 00:03:06.360
drafted many of the key provisions of the invent sect
56
00:03:06.840 --> 00:03:10.120
and Next we have Brian O'Shaughnessy. Brian is a partner
57
00:03:10.159 --> 00:03:14.240
at Dinsmore and Scholl LLP, the Cherch Dinsmore IP Transaction
58
00:03:14.360 --> 00:03:18.400
and Licensing group. He has extensive experience and contested proceeding
59
00:03:18.479 --> 00:03:21.360
before the p TEP. He has also been retained as
60
00:03:21.360 --> 00:03:24.639
a testifying witness in IP and licensing disputes by the
61
00:03:24.719 --> 00:03:28.199
US Department of Justice, US Department of Treasury, and by
62
00:03:28.280 --> 00:03:32.439
various private enterprise Now, before we delve into the four
63
00:03:32.479 --> 00:03:37.840
specific categories of the NPRM, which are one required stipulation
64
00:03:37.960 --> 00:03:42.080
for efficiency to claims found invalid in prior proceedings, three
65
00:03:42.479 --> 00:03:47.080
parallel litigation, and four institutions in extraordinary circumstances, I would
66
00:03:47.199 --> 00:03:50.120
like to invite each of our speakers to provide opening
67
00:03:50.159 --> 00:03:54.360
remarks outlining their view of the NPRM. We will then
68
00:03:54.400 --> 00:03:57.800
move on to a discussion among the panelists. Director Yngkup,
69
00:03:57.800 --> 00:03:59.159
if you could please lead us off.
70
00:04:00.319 --> 00:04:04.479
Sure, thanks Rob, and great to be with all the
71
00:04:04.520 --> 00:04:07.159
panelists and all the Federal Society folks.
72
00:04:07.479 --> 00:04:08.199
Watching this.
73
00:04:10.840 --> 00:04:11.080
Look.
74
00:04:11.280 --> 00:04:15.159
The main point about the n p r M is
75
00:04:15.639 --> 00:04:19.439
that the office is taking steps to go through the
76
00:04:19.519 --> 00:04:24.759
notice and comment process to solicit views from the public
77
00:04:26.120 --> 00:04:33.920
and then make the appropriate final policy decisions, presumably taking
78
00:04:33.959 --> 00:04:39.720
into account the views from the public. And there are
79
00:04:39.800 --> 00:04:46.360
multiple points to the n p r M, and I'm
80
00:04:46.360 --> 00:04:48.439
sure we're going to touch on all of them during
81
00:04:49.040 --> 00:04:55.879
the During the panel discussion, but the key concept.
82
00:04:55.519 --> 00:05:00.480
Here seems to be an effort to.
83
00:05:00.720 --> 00:05:07.399
Align the i PR process with two core principles.
84
00:05:07.600 --> 00:05:12.399
One to have a single UH UH bite at the apple.
85
00:05:13.879 --> 00:05:21.360
At the invalidity stage or in the invalidity analysis UH
86
00:05:21.600 --> 00:05:29.120
during during an infringement case. And to give meaning to
87
00:05:30.439 --> 00:05:33.879
the original concept of the i PR system to be
88
00:05:34.959 --> 00:05:39.680
a faster alternative to disrecord litigation. So they're trying to,
89
00:05:39.920 --> 00:05:45.959
at least conceptually to UH to reduce or eliminate multiple
90
00:05:46.000 --> 00:05:49.120
attacks on the same on the validity of the same.
91
00:05:48.959 --> 00:05:51.439
Patent, and UH to.
92
00:05:53.399 --> 00:05:57.959
Effectively eliminate i prs if they are not in fact
93
00:05:58.160 --> 00:06:04.120
faster than the parallel district coort litigation. Whether whether the
94
00:06:04.240 --> 00:06:08.360
n p r M actually achieves those you know, in
95
00:06:08.399 --> 00:06:15.079
a precise in a perfectly balanced manner, or whether you
96
00:06:15.160 --> 00:06:20.399
think those requirements are good or bad for the patent system,
97
00:06:20.519 --> 00:06:23.639
that's obviously to be debated, and.
98
00:06:23.759 --> 00:06:26.360
We'll have to see what the what the public say.
99
00:06:26.439 --> 00:06:29.959
One thing I'm sure of is that the PTO will
100
00:06:29.959 --> 00:06:33.839
get a very significant number of comments, just judging by
101
00:06:34.399 --> 00:06:40.480
the comments the PTO got on prior UH such requests
102
00:06:40.680 --> 00:06:46.879
for public input on on on on p TAP policies.
103
00:06:48.040 --> 00:06:50.079
So I look forward to the to the conversation.
104
00:06:51.160 --> 00:06:54.639
Thank you, Andrea. Mister Jones, please provide your the n
105
00:06:54.720 --> 00:06:59.160
p r N. I think it's a mess. Let me
106
00:06:59.240 --> 00:07:02.519
just make three quick points. First, it's contrary to statute.
107
00:07:02.560 --> 00:07:05.040
I mean a lot of these things Congress considered and
108
00:07:05.079 --> 00:07:06.399
specifically rejected.
109
00:07:06.480 --> 00:07:08.680
And hopefully Joe will talk a little bit about that.
110
00:07:08.759 --> 00:07:10.360
He was I was the Republican.
111
00:07:09.920 --> 00:07:12.839
Staffer who kind of started off the patent reform process
112
00:07:12.879 --> 00:07:15.959
in the Senate, and Joe was the superstar who carried
113
00:07:15.959 --> 00:07:20.000
it over the finish line. The second problem with the
114
00:07:20.120 --> 00:07:21.399
rings just don't make any sense.
115
00:07:21.439 --> 00:07:22.759
I mean, they're going to lead to all sorts of
116
00:07:22.879 --> 00:07:23.720
arbitrary results.
117
00:07:23.759 --> 00:07:27.199
They based they foreclosed i prs based on non final
118
00:07:27.199 --> 00:07:31.279
decisions for example, right, So you can have all sorts
119
00:07:31.279 --> 00:07:34.079
of situations where you have an initial determination by the
120
00:07:34.079 --> 00:07:37.800
ITC that is eventually overruled by the full Commission or
121
00:07:37.879 --> 00:07:41.839
a district court summary judgment and a kind of decision
122
00:07:42.199 --> 00:07:45.480
saying that you know, this is found not invalid under
123
00:07:45.480 --> 00:07:48.000
one oh three that gets reversed by the federal by
124
00:07:48.040 --> 00:07:48.839
the Federal Circuit.
125
00:07:48.920 --> 00:07:51.199
Right, and it'll be years in between. So you're going
126
00:07:51.240 --> 00:07:53.839
to have situations where you.
127
00:07:53.879 --> 00:07:57.639
Have like a period of time where everyone is foreclosed
128
00:07:57.639 --> 00:08:00.399
from challenging the patent, and by the time the window
129
00:08:00.439 --> 00:08:03.240
opens again because they incorrect decision you know from the
130
00:08:03.240 --> 00:08:07.399
district court gets overruled. Well, most of those petitioners, maybe
131
00:08:07.439 --> 00:08:09.680
all of them, can be time bard because they're defendants
132
00:08:09.720 --> 00:08:11.839
in a lawsuit. You know, they've already been sued on
133
00:08:11.839 --> 00:08:15.480
the patent. So it basically gives the patent owner free
134
00:08:15.519 --> 00:08:19.360
reign for a long period of time, usually three years
135
00:08:19.399 --> 00:08:22.240
I think for a federal circuit decision to ascertain the
136
00:08:22.240 --> 00:08:25.759
pattern without any fear of an IPR, and it's you know,
137
00:08:25.920 --> 00:08:29.279
people call this a one and done type of approach,
138
00:08:29.920 --> 00:08:32.600
in many cases will be a zero and done type approach,
139
00:08:32.720 --> 00:08:35.639
just for exactly those reasons. Another problem I'd point out
140
00:08:35.840 --> 00:08:41.320
is that all of these provisions say that an IPR
141
00:08:41.440 --> 00:08:46.159
shall not be instituted or maintained right, So that presumably
142
00:08:46.240 --> 00:08:50.120
means that if your post final written decision and pre
143
00:08:50.960 --> 00:08:53.600
director review, right, so you already have a decision, but
144
00:08:53.639 --> 00:08:56.240
it's not final yet. If any of the things that
145
00:08:56.320 --> 00:08:58.679
you know in the second and third part of the
146
00:08:58.759 --> 00:09:02.600
Rags happen, which includes so PTO, just a siding is
147
00:09:02.639 --> 00:09:05.200
more likely than not that something will happen in the future.
148
00:09:05.919 --> 00:09:09.600
Then you lose the like basically they will dismiss the IPR,
149
00:09:10.080 --> 00:09:12.639
and then you have already signed a stipulation saying you
150
00:09:12.679 --> 00:09:15.000
can't challenge under one or two, one, O three. In
151
00:09:15.039 --> 00:09:18.639
that scenario, that petitioner not only doesn't get the benefit
152
00:09:18.679 --> 00:09:22.120
of IPR, also can't challenge it in court assuming the
153
00:09:22.159 --> 00:09:25.919
stipulation is deemed valid. So that's like three examples out
154
00:09:25.919 --> 00:09:29.720
of thousands. I think we're the real problems. And I
155
00:09:29.799 --> 00:09:32.200
say the last thing, and this kind of actually surprised me.
156
00:09:33.679 --> 00:09:39.559
The MPRM does not do almost anything to support the
157
00:09:40.360 --> 00:09:44.639
pto's conclusions or proposals with actual evidence or data. I
158
00:09:44.639 --> 00:09:46.639
mean the handful of things that they cite, you know,
159
00:09:46.679 --> 00:09:48.799
I went through them, all their sources, and half of
160
00:09:48.840 --> 00:09:52.320
them don't seem to support the contention the PTOs making
161
00:09:52.360 --> 00:09:54.639
in the first place. But they have all sorts of
162
00:09:54.759 --> 00:09:58.240
factual contentions like oh, this will save litigation costs. Well,
163
00:09:58.279 --> 00:10:01.120
we've got economic studies out there that already talked about
164
00:10:01.120 --> 00:10:03.919
how much litigation cost IPR has saved.
165
00:10:04.399 --> 00:10:06.080
You're going to forfeit that. I don't know how the
166
00:10:06.120 --> 00:10:09.679
PTO guest idea that all on balance, you're going to
167
00:10:09.720 --> 00:10:11.159
say litigation costs.
168
00:10:11.240 --> 00:10:13.559
They say that, you know, stronger patent systems, you know,
169
00:10:14.279 --> 00:10:18.879
are will address market concentration. Well, there's a bunch of
170
00:10:19.080 --> 00:10:23.159
academic papers from econmists saying the opposite. The patents are
171
00:10:23.200 --> 00:10:26.879
correlated with market concentration, not vice versa, so it really
172
00:10:27.000 --> 00:10:28.039
is unsupported.
173
00:10:28.120 --> 00:10:32.039
They use kind of skewed statistics.
174
00:10:31.279 --> 00:10:33.720
And that that surprised me because it seems like that
175
00:10:33.799 --> 00:10:36.399
might be a basis for challenge down the road, assuming
176
00:10:36.440 --> 00:10:38.679
there is any ability to challenge under the APA.
177
00:10:42.240 --> 00:10:44.240
David, mister shaughnessy.
178
00:10:45.200 --> 00:10:48.840
Thanks rod Well, I'll ancho the comments. I'm very pleased
179
00:10:48.840 --> 00:10:51.440
to be here amongst this distinguished panel and it's a
180
00:10:51.480 --> 00:10:53.480
real honor to be here. So thanks to the fed
181
00:10:53.559 --> 00:10:58.279
sock for providing this forum. You know, David raises some
182
00:10:58.519 --> 00:11:01.519
issues that are worthy of consideration, and I'm sure that
183
00:11:01.559 --> 00:11:03.799
those will find their way into his comments that he
184
00:11:03.840 --> 00:11:07.879
provides in this response to notice to proposed rulemaking, And
185
00:11:07.879 --> 00:11:10.960
that's the purpose of this webinar, but it's also the
186
00:11:11.000 --> 00:11:14.720
purpose of the NPRM is to hear from the practitioners
187
00:11:15.240 --> 00:11:18.080
about how the proposed rules might actually be.
188
00:11:18.080 --> 00:11:19.559
Put into practical effect.
189
00:11:21.360 --> 00:11:25.000
I think personally that the proposed rules make a lot
190
00:11:25.000 --> 00:11:27.759
of sense. They bring a lot of balance, They bring
191
00:11:28.559 --> 00:11:32.159
a lot of corrective measures, if you will, to the
192
00:11:32.200 --> 00:11:35.679
way that the IPR system has been implemented. We all
193
00:11:35.799 --> 00:11:38.840
know that the AIA had as one of its objective
194
00:11:38.960 --> 00:11:43.519
to bring greater reliability and transparency to the patent system
195
00:11:43.919 --> 00:11:48.720
and to give people an alternative to litigation. We also
196
00:11:48.840 --> 00:11:52.039
know that the IPR process is one of only three
197
00:11:52.399 --> 00:11:57.279
post grant processes available to challengers at the PTO, and
198
00:11:57.360 --> 00:12:00.799
of course there are the courts and the ITC. So
199
00:12:01.279 --> 00:12:05.320
there are plenty of avenues by which challengers can go
200
00:12:05.440 --> 00:12:09.960
after a particular patent, and I think they have the
201
00:12:10.039 --> 00:12:14.600
opportunity to file PGRs. For example, early on PGRs are
202
00:12:14.679 --> 00:12:15.919
properly time barred.
203
00:12:16.559 --> 00:12:17.919
They give the patent owner.
204
00:12:18.080 --> 00:12:21.440
If we had only PGRs, we'd probably be better off.
205
00:12:21.759 --> 00:12:25.559
They give the patent owner the opportunity to rely on
206
00:12:25.679 --> 00:12:30.679
quiet title to their asset. And so there are lots
207
00:12:30.679 --> 00:12:33.799
of things that we need to do to remedy the
208
00:12:33.840 --> 00:12:38.679
current situation because quite frankly, the IPRs haven't been an
209
00:12:38.679 --> 00:12:43.919
alternative to litigation. They've been an adjunct to litigation, and
210
00:12:44.120 --> 00:12:48.519
this has in fact only raised expense. It's delayed the
211
00:12:48.679 --> 00:12:53.159
decision to a final decision on the validity of a
212
00:12:53.200 --> 00:12:57.639
particular patent, and this has worked to enormous detriment to
213
00:12:57.799 --> 00:13:02.600
our innovation economy. So I disagree with Dave that patents
214
00:13:02.639 --> 00:13:04.720
don't really do the system any good. I think the
215
00:13:04.759 --> 00:13:09.600
patents have been shown to be enormously beneficial, particularly to
216
00:13:09.679 --> 00:13:13.679
the disruptive innovator who doesn't have the assets and the
217
00:13:13.720 --> 00:13:17.919
resources that the incumbents have. So I think bringing some
218
00:13:18.039 --> 00:13:21.559
balance looking at the IPR system in terms of how
219
00:13:21.600 --> 00:13:25.679
it affects the actual patent owners and particularly the innovators
220
00:13:26.759 --> 00:13:31.279
is well placed and these rules make a lot of
221
00:13:31.320 --> 00:13:33.679
sense and I think bring a lot more balance back
222
00:13:33.720 --> 00:13:34.639
into the program.
223
00:13:35.720 --> 00:13:39.039
Thank you Brian, mister Mattow, he's rounded out with you
224
00:13:39.080 --> 00:13:42.759
of huge thank you. You know, it's kind of hard
225
00:13:42.799 --> 00:13:44.840
to take the MPR seriously.
226
00:13:45.639 --> 00:13:48.799
It's basically a set of arbitrary restrictions that are designed
227
00:13:48.840 --> 00:13:50.159
to cut off access.
228
00:13:49.799 --> 00:13:52.559
To review, including for people who are being sued.
229
00:13:53.960 --> 00:13:56.440
The most problematic rule is the one and done role
230
00:13:56.480 --> 00:13:59.480
that if anyone in any forum has ever challenged the patent,
231
00:14:00.120 --> 00:14:03.840
then you can't challenge it if you're sued a decade later,
232
00:14:04.559 --> 00:14:06.879
even if you never knew about the previous suit, The
233
00:14:06.919 --> 00:14:10.600
previous challenge can even be in the ITC proceedings don't
234
00:14:10.600 --> 00:14:13.960
create a stopple against later enforcement of the patent, even
235
00:14:14.000 --> 00:14:17.279
if they find the patent invalid. They include X party
236
00:14:17.320 --> 00:14:21.279
re examine, which parties can't even participate once the proceeding
237
00:14:21.320 --> 00:14:21.879
has started.
238
00:14:21.879 --> 00:14:26.039
But most fundamentally, there's this old Anglo.
239
00:14:25.679 --> 00:14:29.200
American principle that if you're sued, you're allowed to present
240
00:14:29.240 --> 00:14:30.960
your own defense. It was in two thousand and eight
241
00:14:31.000 --> 00:14:34.080
and the Sturgil case that the Supreme Court rejected the
242
00:14:34.120 --> 00:14:37.960
concept of virtual representation, that you don't have the right
243
00:14:38.000 --> 00:14:40.600
to present your own defense because somebody else represented you
244
00:14:40.639 --> 00:14:44.679
somewhere else. Another key feature of the rules is this
245
00:14:45.120 --> 00:14:47.759
timing with district court litigation that if the district court's
246
00:14:47.799 --> 00:14:51.879
going to get to trial faster, we should cut off review. Principally,
247
00:14:51.960 --> 00:14:54.360
that means if you're sued in East Texas, where the
248
00:14:54.399 --> 00:14:57.159
average time to trial is in about sixteen months, then
249
00:14:57.159 --> 00:14:59.120
you don't have the right to challenge the patent at
250
00:14:59.120 --> 00:15:01.039
the board again, even if you're being sued on it
251
00:15:01.480 --> 00:15:05.039
by someone demanding millions, and about ninety percent of the
252
00:15:05.080 --> 00:15:08.960
litigation in East Texas is NPE litigation. Why on earth
253
00:15:09.000 --> 00:15:13.799
we would privilege that, of all things, is completely beyond me.
254
00:15:14.399 --> 00:15:16.159
So what does this mean in practice?
255
00:15:16.679 --> 00:15:18.080
Just in the news the other day there was a
256
00:15:18.120 --> 00:15:22.639
story about Micron appealing a four hundred million dollars verdict
257
00:15:22.679 --> 00:15:26.200
against it in East Texas and the patents, you know,
258
00:15:26.240 --> 00:15:28.120
they were sued earlier, so they were still able to
259
00:15:28.159 --> 00:15:31.320
challenge the pattern. There's a copeending appeal of a p
260
00:15:31.480 --> 00:15:34.120
TAB decision saying these claims are invalid. This is the
261
00:15:34.200 --> 00:15:36.480
technical experts of the board looked at it and decided
262
00:15:36.559 --> 00:15:39.039
this was already known. There are plenty of other suits
263
00:15:39.039 --> 00:15:42.559
against Micron, mostly by mpes, some by y MTC, a
264
00:15:42.679 --> 00:15:45.480
state owned company. In the future, are we're really going
265
00:15:45.519 --> 00:15:48.000
to cut off the ability of Micron and companies like
266
00:15:48.080 --> 00:15:51.159
that to protect itself against the patent that's not valid?
267
00:15:51.720 --> 00:15:55.159
And one final thing, there's this A lot of this
268
00:15:55.240 --> 00:15:58.399
is premised on the notion that district court litigation is
269
00:15:58.519 --> 00:15:59.279
just as good.
270
00:15:59.279 --> 00:16:00.960
A forum for testing these things.
271
00:16:01.480 --> 00:16:04.080
Like since the seventies, we've shifted mainly to doing jury
272
00:16:04.200 --> 00:16:08.440
trials in these cases. Very few jurors have a technical background,
273
00:16:08.879 --> 00:16:11.279
often very skilled truck trial lawyers will tell you not
274
00:16:11.360 --> 00:16:14.200
even to bother present a paper base of patents and
275
00:16:14.240 --> 00:16:17.799
credit publications, obviousness defense do in jury juries are not
276
00:16:18.000 --> 00:16:21.960
going to engage on what was obvious and Semiconductor designed
277
00:16:22.000 --> 00:16:26.360
circuit two thousand and seven. At best, they're inconsistent about it.
278
00:16:26.399 --> 00:16:30.399
And when you get repeated suits, you will have invalid
279
00:16:30.440 --> 00:16:33.679
patents and forced for very high amounts. And I hope
280
00:16:33.679 --> 00:16:36.480
the administration really thinks about this, like how many hits
281
00:16:36.480 --> 00:16:40.360
do you want companies like Micron or Semiconductors and others
282
00:16:40.399 --> 00:16:43.720
to take for hundreds of millions sometimes billions of dollars
283
00:16:44.000 --> 00:16:45.919
for a patent that if they were allowed to challenge
284
00:16:45.960 --> 00:16:48.840
it before the technical experts at the agency, they would
285
00:16:48.879 --> 00:16:52.720
agree that it's not valid. And I've talked to many
286
00:16:52.759 --> 00:16:54.960
people on the life sciences side who think, you know,
287
00:16:55.000 --> 00:16:58.000
we don't really need IPRs, et cetera. And the life
288
00:16:58.000 --> 00:17:01.240
sciences is different, Okay, the quality is higher there. It's
289
00:17:01.279 --> 00:17:04.759
mostly judge trials and you know VIA and the cases.
290
00:17:04.799 --> 00:17:08.319
But I also think back to a line from Bob Armitage,
291
00:17:08.319 --> 00:17:10.759
who was heavily involved in the AI, was General counsel
292
00:17:10.799 --> 00:17:13.440
of Eli Lilly at the time, he warn't people, if
293
00:17:13.480 --> 00:17:16.480
you like patents, if you love patents, do you love
294
00:17:16.519 --> 00:17:20.319
your children? You know most people love their children too.
295
00:17:20.440 --> 00:17:23.079
If your children are misbehaving, don't you want to correct
296
00:17:23.079 --> 00:17:26.640
their behavior? And the folks out there who love patents,
297
00:17:26.680 --> 00:17:29.359
if you see the system being abused, if it's seeing
298
00:17:30.279 --> 00:17:33.799
you know, if if you see it patent's misbehaving, in effect,
299
00:17:34.240 --> 00:17:36.440
you want to correct that behavior because you'll be the
300
00:17:37.319 --> 00:17:41.680
most gentle disciplinarian. And the backlash that's going to come
301
00:17:41.880 --> 00:17:44.359
if we allow things like this to go forward and
302
00:17:44.480 --> 00:17:49.319
literally just immunize patents that never should have issued and
303
00:17:49.359 --> 00:17:55.240
are being asserted by mpees, this is just this is doing.
304
00:17:55.680 --> 00:17:59.200
We're doing severe damage to the integrity and legitimacy of
305
00:17:59.240 --> 00:18:02.799
the system with this NPRM. I very much hope the
306
00:18:02.839 --> 00:18:04.519
administration reconsiders this.
307
00:18:06.480 --> 00:18:06.839
Well.
308
00:18:07.480 --> 00:18:17.400
Thank you, Joseph. Before we get into the individual provisions, Joseph,
309
00:18:17.599 --> 00:18:21.839
you brought up misbehaving patents, and I guess the question
310
00:18:21.960 --> 00:18:25.160
I have is did they misbehaved.
311
00:18:24.519 --> 00:18:27.559
Before the AIA or were they? Were they good.
312
00:18:27.480 --> 00:18:31.559
Children before the AI had inner parties re examinations which
313
00:18:31.680 --> 00:18:35.440
actually had the same scope of challenge. The problem with
314
00:18:35.480 --> 00:18:38.359
inter party the reason the system was upgraded in the
315
00:18:38.400 --> 00:18:43.240
AIA was just the structure of inn Parties reexams made
316
00:18:43.279 --> 00:18:45.599
them impossible to get done in a timely manner. They
317
00:18:45.720 --> 00:18:48.720
pretty routinely dragged out for six or seven years. In fact,
318
00:18:49.200 --> 00:18:51.920
I believe there are still two or three Inner Parties
319
00:18:51.960 --> 00:18:55.519
re exams that are still pending, even though the deadline
320
00:18:55.559 --> 00:18:58.799
for filing them expired in twenty twelve. These are cases, obviously,
321
00:18:58.960 --> 00:19:01.759
but procedure can be dragged out that long that either
322
00:19:01.799 --> 00:19:06.160
party can kind of delay it will is not useful
323
00:19:06.720 --> 00:19:09.519
as a check on validity when you have copending litigation.
324
00:19:10.319 --> 00:19:13.160
But the decision to go back to the agency goes
325
00:19:13.200 --> 00:19:16.039
back to nineteen eighty You validity review has always been
326
00:19:16.079 --> 00:19:20.079
available in course, but over the course of the twentieth century,
327
00:19:20.079 --> 00:19:22.880
Congress heard enough complaints about this. I decided, you know,
328
00:19:22.920 --> 00:19:25.000
we really need technical experts to be able to look
329
00:19:25.000 --> 00:19:28.319
at this. In the eighties, they created XPARTI re Exam.
330
00:19:28.400 --> 00:19:30.559
Then they decided, you know, you really need both parties
331
00:19:30.559 --> 00:19:33.279
to be able to participate. They turn they and then
332
00:19:33.319 --> 00:19:36.480
added Inner Parties re Exam. But Inner Party's reexam just
333
00:19:36.519 --> 00:19:40.240
became dysfunctional. You know, the point of the AI wasn't
334
00:19:40.279 --> 00:19:42.400
just to make it faster and quicker, but it's that
335
00:19:42.440 --> 00:19:46.119
original idea that, especially for these complex technologies, you're not
336
00:19:46.200 --> 00:19:49.519
going to get an accurate and reliable decision on validity
337
00:19:49.880 --> 00:19:53.440
other than from technical experts.
338
00:19:53.880 --> 00:19:58.559
So, Andre, David and Joseph have pointed to a lot
339
00:19:58.599 --> 00:20:03.240
of flaws that they see in the npr M, and
340
00:20:04.200 --> 00:20:09.000
Joseph points out misbehaving patents, which I think might be
341
00:20:09.000 --> 00:20:14.319
better characterized as misbehaving litigants in the courts. But can
342
00:20:14.359 --> 00:20:17.880
you maybe address some of the floors and pointed out
343
00:20:18.440 --> 00:20:21.839
and you know, you highlighted the motivation.
344
00:20:21.559 --> 00:20:22.440
For the npr M.
345
00:20:22.720 --> 00:20:26.200
I don't think anybody, well people may disagree with the motivation,
346
00:20:26.359 --> 00:20:28.599
but can you maybe take on some of those floors
347
00:20:28.640 --> 00:20:30.880
and tell us whether they're right or wrong.
348
00:20:32.839 --> 00:20:36.200
Well, look, first of all, I do want to emphasize that.
349
00:20:36.680 --> 00:20:40.119
This is exactly the process that's supposed to take place.
350
00:20:41.680 --> 00:20:47.240
In a notice in common rulemaking exercise. Folks who have
351
00:20:48.960 --> 00:20:49.720
different points of.
352
00:20:49.759 --> 00:20:53.480
View make them known, and then the administration will consider
353
00:20:53.519 --> 00:20:59.160
them all. So I hope folks that across the various
354
00:20:59.160 --> 00:21:04.079
interests he do that. And I think that will result
355
00:21:05.039 --> 00:21:08.200
in a better rule package at the end of the day.
356
00:21:10.039 --> 00:21:14.799
And you know, but but we have to be careful
357
00:21:15.200 --> 00:21:15.640
with the.
358
00:21:15.640 --> 00:21:18.640
Language that we're using here and and try to stay
359
00:21:18.680 --> 00:21:24.559
away from from hyperbole. So let me just address a
360
00:21:24.599 --> 00:21:29.400
couple of of the points that.
361
00:21:28.480 --> 00:21:34.000
That have been raised just on a factual basis. Uh, David,
362
00:21:34.039 --> 00:21:34.759
You mentioned that.
363
00:21:36.200 --> 00:21:39.799
The NPRM forecloses i PR is based on non final decisions,
364
00:21:40.319 --> 00:21:44.240
and you're right in the in the reading of the
365
00:21:44.359 --> 00:21:49.000
of the rule proposal, which is, you know, if there
366
00:21:49.079 --> 00:21:52.559
is a summary judgment ruling or a jury verdict, the
367
00:21:53.759 --> 00:22:00.599
stopple effectively applies at that point when there are rulings
368
00:22:00.599 --> 00:22:04.960
from the district coords that find the patent not invalid.
369
00:22:06.039 --> 00:22:09.200
And your point was, well, those can be reversed on appeal.
370
00:22:10.039 --> 00:22:15.839
Okay, but let's just think through the alternatives here. The
371
00:22:15.880 --> 00:22:20.839
district coord in those examples found the patent not invalid
372
00:22:21.279 --> 00:22:26.079
if it goes on appeal, two possible outcomes theoretically, obviously,
373
00:22:26.319 --> 00:22:30.240
there are many others. Just theoretically, Either the Federal Circuit
374
00:22:30.680 --> 00:22:34.599
affirms what was just found and therefore the patent is
375
00:22:34.640 --> 00:22:38.599
still not invalid, and in that case there's no reason
376
00:22:38.720 --> 00:22:43.079
not to attach the estopel at the earlier point in time,
377
00:22:43.200 --> 00:22:47.000
why wait another year and a half. On the other hand,
378
00:22:47.559 --> 00:22:58.200
if if the Federal Circuit finds the patent invalid, then
379
00:22:58.240 --> 00:23:03.720
the patent's gone and everything thing goes away, including the
380
00:23:03.799 --> 00:23:08.480
litigation and the patent completely, you don't need at that point.
381
00:23:08.480 --> 00:23:11.599
If the Federal Circuit speaks and the Federal Circuit has
382
00:23:11.599 --> 00:23:15.200
found the patent invalid, you no longer need an IPR
383
00:23:15.279 --> 00:23:19.039
process obviously at that point in time. So in either circumstance,
384
00:23:20.200 --> 00:23:24.279
from just from that pure technical perspective, I don't think
385
00:23:24.319 --> 00:23:31.119
that's that that is necessarily you know, a reason to
386
00:23:31.200 --> 00:23:33.279
find meaningful fault here.
387
00:23:33.359 --> 00:23:35.559
Now you can argue.
388
00:23:37.079 --> 00:23:40.720
On the other point that mister Jones has made, which is,
389
00:23:42.920 --> 00:23:45.559
you know, the pure one and done type of an approach,
390
00:23:45.640 --> 00:23:48.599
which is and I think Joe made the same point,
391
00:23:48.640 --> 00:23:49.279
which is.
392
00:23:49.839 --> 00:23:52.400
Look, why should.
393
00:23:53.720 --> 00:23:58.960
The results coming from a different litigation prosecuted by a
394
00:23:59.000 --> 00:24:02.920
different party, completely unrelated into the long distance in time
395
00:24:03.400 --> 00:24:07.720
and perhaps over different you know, different acoust products, et cetera,
396
00:24:07.799 --> 00:24:08.240
et cetera.
397
00:24:08.319 --> 00:24:10.000
Why should that preclude others?
398
00:24:10.519 --> 00:24:12.799
And I have to say that is a fair debate,
399
00:24:13.240 --> 00:24:17.680
and there are policy reasons to go either way, But
400
00:24:17.839 --> 00:24:20.559
it is a fair debate. But one thing I will say,
401
00:24:20.920 --> 00:24:24.920
and again to avoid hyperbole here, it's not that if
402
00:24:25.759 --> 00:24:29.920
if you go and you accept the nprm's approach to
403
00:24:29.960 --> 00:24:32.920
that policy, if that's what comes out, it doesn't mean
404
00:24:32.960 --> 00:24:37.319
that the world has collapsed and defendants have no way
405
00:24:37.400 --> 00:24:39.920
to challenge the validity of a patent anymore, and then
406
00:24:40.000 --> 00:24:44.359
that's it. Billions of dollars will be, you know, forever
407
00:24:44.440 --> 00:24:50.480
at risk without recourse. The defendants can still defend themselves,
408
00:24:50.519 --> 00:24:54.960
obviously in the disrecord litigation or the ITC litigation, just.
409
00:24:54.880 --> 00:24:57.559
As they have been from the beginning of the patent system.
410
00:24:58.000 --> 00:25:00.680
They can still go to that pattern into office if
411
00:25:00.680 --> 00:25:03.240
they want and do expart their re examinations.
412
00:25:03.680 --> 00:25:08.480
That is still a viable approach.
413
00:25:09.400 --> 00:25:14.559
I am not saying that that is the correct policy position.
414
00:25:15.759 --> 00:25:19.519
I acknowledge that there are legitimate debates on both sides,
415
00:25:20.240 --> 00:25:23.319
and I don't need to repeat, but David and Joe
416
00:25:23.440 --> 00:25:27.519
have made the policy argument why that would not be
417
00:25:27.599 --> 00:25:32.039
fair to the particular litigant in this particular case. On
418
00:25:32.079 --> 00:25:36.680
the other side, one can argue the patent owners might argue, well, look,
419
00:25:36.720 --> 00:25:39.759
you need quiet title and the PTO has already. You know,
420
00:25:40.319 --> 00:25:43.160
an adjudicave body has already looked at the validity of
421
00:25:43.200 --> 00:25:48.799
this thing. And a patent is an objective document, and
422
00:25:49.000 --> 00:25:54.400
once the judiciary, in whatever format, has passed on it, then.
423
00:25:55.119 --> 00:25:57.160
Why should the judiciary look at it again?
424
00:25:57.960 --> 00:26:02.839
Now, I really do understand the practical considerations that nothing
425
00:26:02.920 --> 00:26:06.200
is purely objective in this in this world, and claim
426
00:26:06.240 --> 00:26:08.759
constructions can be different, the scope of claims can be
427
00:26:08.799 --> 00:26:11.640
interpreted differently based on the infringement.
428
00:26:11.079 --> 00:26:13.240
Allegations in a particular case, and all of that.
429
00:26:13.519 --> 00:26:16.799
But my only point is that that is a fair
430
00:26:16.880 --> 00:26:21.799
debate and we should avoid the extreme hyperbole on both sides.
431
00:26:22.240 --> 00:26:27.359
One final point to go to to address one one
432
00:26:27.359 --> 00:26:35.599
point that Joe made. Joe Joey fundamentally seemed to reject jury,
433
00:26:37.039 --> 00:26:41.359
the role of juries, at least on the validity analysis.
434
00:26:41.839 --> 00:26:47.400
But look, the reality is, the jury system is fundamental
435
00:26:47.960 --> 00:26:52.279
to the American judicial process. It's in our constitution. It's
436
00:26:52.319 --> 00:26:56.440
it's it's there, it's there twice, it's in the body
437
00:26:56.559 --> 00:27:02.039
and in the amendments to be frank and and it's
438
00:27:02.079 --> 00:27:06.279
been a core part of our system of laws from
439
00:27:06.279 --> 00:27:10.119
the beginning of time. And if you don't trust the
440
00:27:10.200 --> 00:27:18.559
jury system, then we have bigger problems with our judicial
441
00:27:18.640 --> 00:27:27.400
system then patent validity challenges. But I'll say this, I
442
00:27:27.440 --> 00:27:31.160
think it's a fair debate. You know that you're pointing
443
00:27:31.200 --> 00:27:35.680
out our juries technically equipped or not to hear patent cases.
444
00:27:35.720 --> 00:27:38.799
And countries around the world have had that debate. And
445
00:27:39.680 --> 00:27:41.960
you know, we are still here in the United States
446
00:27:42.000 --> 00:27:44.680
on the side of jury trials. Other countries do not
447
00:27:44.759 --> 00:27:50.279
have them. But when it comes to the validity question,
448
00:27:52.000 --> 00:27:56.039
if you do not like you don't trust the juries,
449
00:27:56.559 --> 00:28:01.839
or a particular defendant does not trust jurys, then that
450
00:28:01.920 --> 00:28:06.200
defendant can go and do an IPR. But just do
451
00:28:06.359 --> 00:28:10.039
the IPR. Then the biggest problem that I've had was
452
00:28:10.079 --> 00:28:18.359
with the insistence on both. And if one of your clients,
453
00:28:18.400 --> 00:28:22.640
Joe says, look, I agree with you. I don't think
454
00:28:22.680 --> 00:28:26.279
a jury is capable to understand my complicated technology here,
455
00:28:26.640 --> 00:28:29.599
and from a validity point of view, I don't think
456
00:28:29.599 --> 00:28:32.119
we should give it to the jury, So let's give
457
00:28:32.119 --> 00:28:35.559
it to the PETAB. But in that case, why also
458
00:28:35.680 --> 00:28:40.880
maintain the parallel ability to do the jury as well?
459
00:28:41.720 --> 00:28:45.640
And you know this hasn't come up yet here in
460
00:28:45.680 --> 00:28:50.480
this discussion, but you know there is the prevailabill out there,
461
00:28:51.599 --> 00:28:56.039
and that's what that bill tries to accomplish. It's like, okay,
462
00:28:56.359 --> 00:29:01.000
each defendant can pick and it's the choice of the defendant.
463
00:29:00.920 --> 00:29:01.759
And you pick one.
464
00:29:02.920 --> 00:29:06.200
You pick the jury or the court system, or you
465
00:29:06.279 --> 00:29:10.119
pick the p tap system, but not both. So you've
466
00:29:10.119 --> 00:29:13.599
got to pick, you know, the The concept in general
467
00:29:13.640 --> 00:29:19.359
here is pick the horse you're going to ride, but
468
00:29:19.599 --> 00:29:27.640
don't do it. Don't do both. And that goes a
469
00:29:27.640 --> 00:29:31.240
little bit beyond this npr N because this NPRM has
470
00:29:31.480 --> 00:29:35.000
other issues beyond just picking one or the other for
471
00:29:35.079 --> 00:29:40.160
one particular defendant. But conceptually, I think that's a debate
472
00:29:41.519 --> 00:29:44.559
that's an issue worth discussing and resolving.
473
00:29:44.839 --> 00:29:48.400
Frankly, well, thank you, Andre Dave.
474
00:29:48.480 --> 00:29:51.440
I want to give you an opportunity to respond to
475
00:29:51.799 --> 00:29:55.599
areas that Andrea has said. But Joe, first, I want
476
00:29:55.640 --> 00:29:58.759
to give you the opportunity to respond to being criticized,
477
00:29:58.960 --> 00:30:01.039
not like the jury.
478
00:30:01.319 --> 00:30:05.400
Okay, well, look under the system you're describing, you know,
479
00:30:05.400 --> 00:30:08.519
where you're forced to choose it is. You know, it's
480
00:30:08.599 --> 00:30:10.880
cultorably and reasonable. We could have that debate. You're basically
481
00:30:10.880 --> 00:30:13.039
describing the system you left in place when you left
482
00:30:13.039 --> 00:30:16.759
the agency. That is not what the NPRM does. Under
483
00:30:16.759 --> 00:30:19.880
the NPRM. Literally again, like someone else was sued ten
484
00:30:19.960 --> 00:30:24.279
years earlier and couldn't bring a challenge, brought an unsuccessful challenge.
485
00:30:24.440 --> 00:30:26.400
Now you can't bring a challenge and doing a.
486
00:30:26.319 --> 00:30:30.039
So terrorist stipulation, et cetera isn't going to overcome the
487
00:30:30.119 --> 00:30:31.440
rules that they could in place.
488
00:30:31.440 --> 00:30:31.759
Here.
489
00:30:32.279 --> 00:30:34.440
They seem to not even have the stipulation in the
490
00:30:35.279 --> 00:30:39.400
parallel proceedings provision. You literally will you know, it doesn't
491
00:30:39.440 --> 00:30:41.720
matter what the case is. Someone else was sued earlier,
492
00:30:41.799 --> 00:30:44.279
or you're suited in a fast moving district and you
493
00:30:44.400 --> 00:30:48.680
cannot go to an inner party is proceeding before the agency.
494
00:30:49.119 --> 00:30:51.680
And it's great that everyone loves juries. Juries are good
495
00:30:51.680 --> 00:30:53.240
at a lot of things. They can tell when people
496
00:30:53.279 --> 00:30:56.119
are lying. But again, your typical jury does not have
497
00:30:56.200 --> 00:30:59.759
a technical background. In the few cases where people present
498
00:30:59.799 --> 00:31:02.880
these defenses and they're they're able to interview the jurors later,
499
00:31:02.960 --> 00:31:06.680
they routinely discover it was the jury deliberations were a disaster.
500
00:31:06.880 --> 00:31:09.759
The jury did not engage at all with the technology. Look,
501
00:31:09.799 --> 00:31:12.519
a lot of this stuff is just very complex and
502
00:31:12.559 --> 00:31:16.519
having the technical background to at least no understand the
503
00:31:17.160 --> 00:31:20.880
you know, the prior art is a critical element to
504
00:31:20.920 --> 00:31:25.240
being able to accurately and reliably assess you know, you
505
00:31:25.279 --> 00:31:27.759
know whether that you know whether this was obvious or not.
506
00:31:28.279 --> 00:31:31.119
You know, jurors tend to be motivated by things like narratives.
507
00:31:31.119 --> 00:31:33.880
When you just when you watch the way really good
508
00:31:33.920 --> 00:31:37.119
trial lawyers prepare for this. It's all about our narratives
509
00:31:37.160 --> 00:31:39.960
and our themes and uh, it's not about are the
510
00:31:40.000 --> 00:31:42.279
limitations to the claim meant by the prior art?
511
00:31:43.039 --> 00:31:44.319
And again, this is we've had.
512
00:31:44.680 --> 00:31:47.799
You know, the Supreme Court started talking about the need
513
00:31:47.880 --> 00:31:50.920
for technical experts in patent cases going.
514
00:31:50.720 --> 00:31:52.880
Back to the nineteenth century, learned and.
515
00:31:53.440 --> 00:31:55.680
Denounced how ridiculous it is that he is a judge,
516
00:31:55.680 --> 00:31:57.880
had to learn this stuff and that we needed some
517
00:31:57.920 --> 00:32:00.480
system like that. This was it was a long debate
518
00:32:00.519 --> 00:32:04.039
building up to the creation of these post issuance proceedings.
519
00:32:04.079 --> 00:32:07.799
And it's pretty clear what's going to happen if you
520
00:32:07.880 --> 00:32:11.559
cut these off. You're going to immunize invalid patterns and
521
00:32:11.599 --> 00:32:15.000
make it impossible to effectively challenge them. And again, like
522
00:32:15.039 --> 00:32:17.960
how many multi hundred million dollar hits do we want
523
00:32:18.440 --> 00:32:21.880
Micron technology or chip makers to make. These are big companies.
524
00:32:21.920 --> 00:32:24.640
But that's money they could spend on R and D.
525
00:32:24.720 --> 00:32:28.079
And I'll tell you some of these very companies have
526
00:32:28.880 --> 00:32:32.720
expressed in our private discussions that this is existential for them.
527
00:32:32.839 --> 00:32:36.000
If they don't have access to some way to challenge
528
00:32:36.039 --> 00:32:38.839
these cases in the MP suits they're facing in Texas,
529
00:32:39.240 --> 00:32:42.200
it will eventually run them out of business. So again,
530
00:32:42.240 --> 00:32:45.559
I just hope that administration someone talks sense into the
531
00:32:45.599 --> 00:32:48.599
people up there. Jdevans has said all these very intelligent
532
00:32:48.640 --> 00:32:51.519
things about manufacturing, how you can't give up.
533
00:32:51.480 --> 00:32:52.920
The ability to make things.
534
00:32:52.920 --> 00:32:55.839
You're eventually going to be impoverished if you forget how.
535
00:32:55.759 --> 00:32:56.160
To make things.
536
00:32:56.200 --> 00:32:58.279
A lot of innovation just comes out of the process
537
00:32:58.680 --> 00:33:03.039
of mastering the manufacturer. If we let companies like Micron
538
00:33:03.160 --> 00:33:05.920
be run out of business or or hobbled, you know,
539
00:33:06.000 --> 00:33:09.759
our manufacturing strategy is get your dram memories from China.
540
00:33:09.920 --> 00:33:15.279
That's the administration's manufacturing strategy. If they go forward with
541
00:33:15.839 --> 00:33:18.720
some of the ridiculous things in this NPR M.
542
00:33:19.160 --> 00:33:21.640
Okay, I mean, look again, I really think we should
543
00:33:21.640 --> 00:33:22.960
avoid hyperbole here.
544
00:33:23.400 --> 00:33:24.160
They're there.
545
00:33:25.359 --> 00:33:32.119
It's just because you have to litigate a patent in
546
00:33:32.200 --> 00:33:36.799
court or at the ITC or through X part eary exam.
547
00:33:36.920 --> 00:33:39.759
Just because this one tool is unavailable in a particular
548
00:33:39.799 --> 00:33:44.640
case doesn't mean that the United States manufacturing infrastructure collapses.
549
00:33:44.680 --> 00:33:48.200
I'm not debating whether you like the mp RM or not.
550
00:33:48.559 --> 00:33:50.720
There definitely points to be discussed.
551
00:33:50.960 --> 00:33:55.640
But again, I think we're going to lose perspective on
552
00:33:57.000 --> 00:34:01.119
creating a better system if we gauge in this type
553
00:34:01.119 --> 00:34:04.839
of hyperbole. But on the jury point, I just want
554
00:34:04.880 --> 00:34:12.880
to ask you, Joe, a direct question. Accepting hypothetically what
555
00:34:12.920 --> 00:34:15.119
you just said, the juries are not capable of doing that,
556
00:34:15.199 --> 00:34:18.400
and you know some cases are definitely technology is more complicated,
557
00:34:18.480 --> 00:34:21.239
and in that particular case, you really don't think the
558
00:34:21.320 --> 00:34:24.320
jury can do it, and you want the experts of
559
00:34:24.360 --> 00:34:27.639
the pe TAP to do that validity challenge. Do you
560
00:34:27.719 --> 00:34:30.719
agree then that in that case you should not also
561
00:34:30.760 --> 00:34:34.039
maintain the ability to go to that jury that you
562
00:34:34.239 --> 00:34:38.119
just articulated is not reliable.
563
00:34:39.760 --> 00:34:41.559
You know that's not what the statute says, but it's
564
00:34:41.599 --> 00:34:45.119
a fair compromise. Frankly, I think if a review has
565
00:34:45.119 --> 00:34:47.360
been instituted, if the board is already found there's a
566
00:34:47.440 --> 00:34:50.599
reasonable likeli that the claims are invalid, then you should
567
00:34:50.639 --> 00:34:51.280
stay of the trial.
568
00:34:51.360 --> 00:34:54.400
There's an excellent chance at that point that some or
569
00:34:54.480 --> 00:34:54.880
all of the.
570
00:34:54.840 --> 00:34:58.199
Claims will be canceled once you've met that institution threshold
571
00:34:58.519 --> 00:35:02.840
and going through trial frankly a waste of everyone's money. Typically,
572
00:35:02.880 --> 00:35:05.800
when these dual litigations have to go forward that patent
573
00:35:05.800 --> 00:35:09.079
owners claim a complain about, it's not the defendant who
574
00:35:09.079 --> 00:35:11.880
wanted the litigation to go forward, it's the plaintiff who
575
00:35:11.920 --> 00:35:15.199
wanted the litigation to go forward. Typically, from what I've seen,
576
00:35:15.239 --> 00:35:17.519
if both the defendant and the plaintiff asked for a
577
00:35:17.599 --> 00:35:20.920
stay of the case pending the completion of the review, the.
578
00:35:20.920 --> 00:35:22.679
Judge will grant it.
579
00:35:23.320 --> 00:35:26.360
And look, I'm not saying this is you know, you
580
00:35:26.480 --> 00:35:29.480
do get cases where the technology is very accessible and
581
00:35:29.519 --> 00:35:31.719
where you know, an ordinary person can.
582
00:35:31.679 --> 00:35:33.880
Assess, you know what, have this been an obvious or not.
583
00:35:34.039 --> 00:35:37.039
But in some of these cases, it's just it's just
584
00:35:37.119 --> 00:35:40.320
invaluable to have that technical expert and at the.
585
00:35:40.400 --> 00:35:42.920
Very least you're not going to get a reliable result.
586
00:35:43.000 --> 00:35:46.480
And when these companies are facing repeated litigation again, like
587
00:35:46.519 --> 00:35:49.800
these numbers are in the papers, these are multi hundred million,
588
00:35:49.920 --> 00:35:52.039
even billion dollar awards.
589
00:35:52.119 --> 00:35:53.239
Do we want to take.
590
00:35:53.119 --> 00:35:56.239
That kind of money out of these companies' hides, you know,
591
00:35:56.559 --> 00:35:58.760
money that could be spent on building an Elorado plan
592
00:35:59.519 --> 00:36:02.119
or a chip fab. It seems like a no brainer
593
00:36:02.159 --> 00:36:05.480
to me that we want an accurate and reliable assessment
594
00:36:05.559 --> 00:36:08.559
of validity before we shift that kind of money around.
595
00:36:10.360 --> 00:36:14.079
Okay, I promise I will get to you, because I'm
596
00:36:14.079 --> 00:36:16.679
sure there's a lot you'd like to say about this conversation, Brian,
597
00:36:16.760 --> 00:36:22.639
I'd really like to bring you in and I, you know,
598
00:36:23.039 --> 00:36:26.480
in light at a time. But excuse me. I like
599
00:36:26.559 --> 00:36:28.880
to try to address each of the provisions of the
600
00:36:29.000 --> 00:36:33.960
MPR separately. So the first provision is the required Stipulation,
601
00:36:34.599 --> 00:36:37.159
and it says, quote, inter party reviews shall not be
602
00:36:37.239 --> 00:36:38.519
institute or maintain the lists.
603
00:36:38.519 --> 00:36:40.960
Each petition to file the stipulation with the.
604
00:36:40.880 --> 00:36:43.199
Board in any other tribunal where it is litigating or
605
00:36:43.280 --> 00:36:46.519
later litigates regarding the challenge patent, stating that if the
606
00:36:46.599 --> 00:36:49.719
trial is instituted, the petitioner at any real party in
607
00:36:49.760 --> 00:36:52.719
interest or privy of the petitioner, will not raise grounds
608
00:36:52.719 --> 00:36:56.039
of invalidity or unpattability with respects to the challenge patents
609
00:36:56.280 --> 00:36:58.199
on the one O two or one O three in
610
00:36:58.280 --> 00:37:02.400
any of the proceeding can you tell us whatever benefits
611
00:37:02.440 --> 00:37:04.079
or flaws you see in that provision.
612
00:37:05.679 --> 00:37:10.079
Well, I think the benefits are obvious in the sense that, Okay,
613
00:37:10.159 --> 00:37:13.880
we're going to actually choose a tribunal, and we're going
614
00:37:13.920 --> 00:37:19.239
to abide by the decision of that tribunal. So whichever
615
00:37:19.280 --> 00:37:23.159
way it goes and whichever party, whatever the parties decide,
616
00:37:23.760 --> 00:37:28.239
it makes sense rather than having two duplicative proceedings that,
617
00:37:28.320 --> 00:37:31.519
by the way, are decided according to different burdens of
618
00:37:31.599 --> 00:37:35.559
proof and different standards, so we can have competing decisions
619
00:37:35.599 --> 00:37:39.079
that come out of the Article three courts and decisions
620
00:37:39.079 --> 00:37:42.679
that come out of the PTO tribunal that are in
621
00:37:42.800 --> 00:37:46.400
conflict but are both correct, and that just doesn't make
622
00:37:46.440 --> 00:37:49.920
any sense from a jurisprudential efficiency standpoint.
623
00:37:51.800 --> 00:37:58.320
And I think to comment on Joe's remarks about.
624
00:37:58.039 --> 00:38:04.679
The professional and technological expertise within the Patent Office relative
625
00:38:04.719 --> 00:38:08.199
to that of a jury. You know, I'm a little
626
00:38:08.239 --> 00:38:11.480
bit skeptical of the notion that just because we have
627
00:38:11.559 --> 00:38:14.840
technical experts in the PTO that they're necessarily going to
628
00:38:14.840 --> 00:38:17.719
always come to the right conclusion. The fact of the
629
00:38:17.760 --> 00:38:19.960
matter is we have an issued patent that the PTO
630
00:38:20.079 --> 00:38:24.480
has determined is patentable, and then it goes back into
631
00:38:24.480 --> 00:38:28.559
the same agency before substantially the same technical experts who
632
00:38:28.599 --> 00:38:32.199
come to the opposite conclusion. That just doesn't seem to
633
00:38:32.239 --> 00:38:36.360
be efficient from the standpoint of investment and innovation in
634
00:38:36.400 --> 00:38:39.960
giving people the opportunity to move forward. So I'm also
635
00:38:40.079 --> 00:38:43.280
troubled by sort of the one way starry decisis that
636
00:38:43.440 --> 00:38:48.079
exists under the IPR system. The serial challenges that take
637
00:38:48.119 --> 00:38:51.400
place on substantially the same arguments means that the patent
638
00:38:51.519 --> 00:38:56.679
owner is perpetually in jeopardy and never really gets out
639
00:38:56.679 --> 00:39:02.239
from underneath sad whereas they would in court proceeding. But
640
00:39:02.559 --> 00:39:05.760
we don't have anything that stops the serial challenges that
641
00:39:05.800 --> 00:39:08.519
are in place right now. So I think, you know,
642
00:39:09.800 --> 00:39:12.559
somebody go out to get to choose the tribunal and
643
00:39:12.599 --> 00:39:17.679
then that really should be effectively the end point. But
644
00:39:17.719 --> 00:39:21.400
we don't have that, and so consequently we have duplicative litigation,
645
00:39:21.480 --> 00:39:25.800
We have duplicative IPRs, and it's just not efficient, and
646
00:39:25.840 --> 00:39:29.119
it's not fair and reasonable for the patent owners, and
647
00:39:29.159 --> 00:39:30.920
it certainly doesn't promote innovation.
648
00:39:31.760 --> 00:39:33.719
I'll tell you what, Brian, I'll trade you one and
649
00:39:33.760 --> 00:39:35.719
done on the IPR side for one and done on
650
00:39:35.800 --> 00:39:39.199
the on the litigation side, pan owners can only bring
651
00:39:39.239 --> 00:39:42.719
one case, preferably just against one defendant, and then they're
652
00:39:42.719 --> 00:39:45.199
done forever, and then they can't see anybody else, and
653
00:39:45.199 --> 00:39:47.599
then we can have one and done on the IPR side.
654
00:39:47.599 --> 00:39:50.679
I'd be happy to make that deal, but they are gave.
655
00:39:50.800 --> 00:39:52.840
I mean, if you bring a patent suit and the
656
00:39:52.920 --> 00:39:56.559
defendant proves that the patent's invalid, they're done. They've got
657
00:39:56.599 --> 00:39:59.519
they've shot their chance, and they're not going to get
658
00:39:59.519 --> 00:40:02.119
to come back. Can bring that up again if they win,
659
00:40:02.280 --> 00:40:04.679
that's a different story. And by the way, usually they're
660
00:40:04.800 --> 00:40:08.199
arguing about infringement at that point. Now, certainly the defendant
661
00:40:08.239 --> 00:40:11.920
at that point can again raise substantially the same arguments
662
00:40:11.920 --> 00:40:16.360
of invalidity, but presumably the judge will be at least
663
00:40:16.519 --> 00:40:19.760
moderately persuaded by the arguments that were raised in it
664
00:40:19.880 --> 00:40:20.840
earlier proceeding.
665
00:40:21.880 --> 00:40:25.800
So you know, I think that exists, Dave, I don't know.
666
00:40:26.000 --> 00:40:27.800
I'm not so sure, but I won't argue the point.
667
00:40:28.119 --> 00:40:30.199
I'd like to get back to kind of Andre's point
668
00:40:30.199 --> 00:40:32.440
about exaggeration, because I'm a big exaggerator.
669
00:40:32.519 --> 00:40:34.920
But it is no exaggeration to.
670
00:40:34.840 --> 00:40:37.280
Say it's not just that billions would be at risk
671
00:40:37.320 --> 00:40:40.679
in judgments. I mean, you look at the litigation record
672
00:40:40.920 --> 00:40:42.360
of the companies I represent.
673
00:40:42.599 --> 00:40:44.199
They do pretty well in litigation.
674
00:40:44.280 --> 00:40:47.480
They did pretty well in litigation prior to the AIA,
675
00:40:47.559 --> 00:40:50.280
but not always right. You do have a lot of
676
00:40:50.360 --> 00:40:53.199
uncertainty with choice. But it will be billions of dollars
677
00:40:53.519 --> 00:40:57.920
just in litigation costs that will be added here easily, billions.
678
00:40:57.960 --> 00:41:01.119
I mean, there was a study pre AIA that's that just.
679
00:41:01.239 --> 00:41:02.440
I think PAE.
680
00:41:02.159 --> 00:41:05.199
Suits resulted in something like a thirty two billion dollar
681
00:41:05.320 --> 00:41:08.719
loss to the US economy. And to Andre's point about
682
00:41:08.760 --> 00:41:11.760
again about exaggeration, it's not necessarily exaggeration.
683
00:41:12.119 --> 00:41:14.480
I don't know what's going to happen, but this look
684
00:41:14.599 --> 00:41:15.239
is going to look.
685
00:41:15.119 --> 00:41:18.519
A lot like PREAIA days, and that looked pretty ugly.
686
00:41:18.639 --> 00:41:23.320
And companies really do leave countries because of kind of
687
00:41:23.639 --> 00:41:28.079
litigation risk. When I was at Microsoft during the Motorola case,
688
00:41:28.079 --> 00:41:31.400
We've been telling the German government for years, you know,
689
00:41:31.519 --> 00:41:34.119
the kind of the liability under the penal laws is
690
00:41:34.119 --> 00:41:35.360
getting out of control.
691
00:41:35.679 --> 00:41:37.280
You going to start driving business away.
692
00:41:37.639 --> 00:41:40.480
During the motorol A litigation, Microsoft announced that it was
693
00:41:40.519 --> 00:41:44.400
moving it's it's European distribution center out of Germany, and
694
00:41:44.440 --> 00:41:46.159
we've got to call it there too later from the
695
00:41:46.159 --> 00:41:48.400
German government. That's a lot of jobs and a lot
696
00:41:48.440 --> 00:41:50.519
of tax revenue. What can we do? I said, well,
697
00:41:50.559 --> 00:41:53.320
you can listen to us like two years ago. Now
698
00:41:53.800 --> 00:41:56.960
the decisions made and we're leaving. So it really does
699
00:41:57.760 --> 00:41:59.519
I mean, you know, I can point to a number
700
00:41:59.519 --> 00:42:04.679
of experiences where people have made fairly large corporate decisions
701
00:42:04.679 --> 00:42:07.760
and sometimes to leave the entire jurisdiction just because of
702
00:42:07.800 --> 00:42:10.559
the liability, because you have other options, right, and.
703
00:42:10.639 --> 00:42:12.719
So if it's if the United.
704
00:42:12.440 --> 00:42:16.280
States is slightly better rather than a lot better as
705
00:42:16.320 --> 00:42:22.480
a site for your manufacturing plant, well extra onion two
706
00:42:22.519 --> 00:42:24.239
hundred and three hundred million dollars can.
707
00:42:24.280 --> 00:42:27.400
Tempt a balance, They really can't have an effect. I
708
00:42:27.400 --> 00:42:27.920
would say.
709
00:42:27.960 --> 00:42:30.440
One of the things that's more mobile than companies and
710
00:42:30.559 --> 00:42:32.119
moving in response to.
711
00:42:33.719 --> 00:42:36.239
Litigation or legal developments is investment.
712
00:42:36.599 --> 00:42:39.639
And if investors know that they're not going to get
713
00:42:39.679 --> 00:42:43.000
the return on their investment because of a weak patent system,
714
00:42:43.480 --> 00:42:46.639
they're going to invest in companies elsewhere. And we've already
715
00:42:46.679 --> 00:42:49.320
seen that happen, and so what we want to do
716
00:42:49.400 --> 00:42:52.079
is we want to invest in disruptive technologies here in
717
00:42:52.119 --> 00:42:55.119
the United States, and so we need to protect innovators
718
00:42:55.159 --> 00:42:56.800
and we need to protect patent holders.
719
00:42:57.199 --> 00:42:59.079
Well, Brent, that just doesn't make any sense to me.
720
00:42:59.119 --> 00:43:02.079
I mean, most sees that are investing in companies, they expect
721
00:43:02.079 --> 00:43:05.440
to operate in multiple countries, So you'd have you'd have
722
00:43:05.480 --> 00:43:08.960
to have the same defects in every country. That's making
723
00:43:08.960 --> 00:43:10.639
any sense, right, And then if you have the same
724
00:43:10.719 --> 00:43:13.920
defects in the patent systems of every country enough to
725
00:43:14.000 --> 00:43:16.840
like reduce insteadive, well there'd be no point to moving.
726
00:43:17.039 --> 00:43:19.719
And if you're in an international company, there is already
727
00:43:19.760 --> 00:43:22.639
no point to moving because under trips you can face
728
00:43:22.679 --> 00:43:25.360
the same you know, when you're located in China and
729
00:43:25.360 --> 00:43:27.119
you apply for a US patent, you're going to face
730
00:43:27.159 --> 00:43:30.679
the same defects. And you know, when you're a US company,
731
00:43:31.039 --> 00:43:33.679
you're almost always going to apply for a patent in China.
732
00:43:33.719 --> 00:43:35.559
So it just it doesn't make sense to me that
733
00:43:35.599 --> 00:43:39.079
anyone would there's no reason under trips for anyone ever
734
00:43:39.159 --> 00:43:42.400
to change their residents because of patent laws.
735
00:43:43.039 --> 00:43:46.880
Well, I mean that may be true for the large
736
00:43:46.960 --> 00:43:54.320
multinationals you represent, but it's not true of the startups,
737
00:43:54.440 --> 00:44:01.559
the original entrepreneurs and the like. And you know, a
738
00:44:01.599 --> 00:44:07.039
lot of American innovation happens in the startup economy obviously
739
00:44:07.079 --> 00:44:12.480
across the spectrum, and usually you look to your domestic
740
00:44:13.400 --> 00:44:14.440
market first.
741
00:44:14.920 --> 00:44:18.039
You know, if you're an American startup, your.
742
00:44:17.880 --> 00:44:22.599
First instance is I'm looking to develop and market my
743
00:44:22.679 --> 00:44:26.639
product here in the United States, and if I'm successful,
744
00:44:26.719 --> 00:44:29.760
then I'll go to Europe maybe, and then if i'm successful,
745
00:44:29.800 --> 00:44:31.960
I'll go to China and time and so on and
746
00:44:32.000 --> 00:44:36.480
so forth. But first and foremost, I need my domestic
747
00:44:36.559 --> 00:44:40.280
market and I need to protect that domestic market because
748
00:44:40.320 --> 00:44:42.679
if I don't have that by the time I get
749
00:44:42.679 --> 00:44:45.079
to Europe, I won't ever get to Europe, orate to China.
750
00:44:45.119 --> 00:44:47.719
It's going to be too late. My product will be killed.
751
00:44:47.719 --> 00:44:53.280
When a company will be killed in its infancy, obviously,
752
00:44:53.320 --> 00:44:57.079
when the companies are mature and they're multinationals, conglomerates and
753
00:44:57.159 --> 00:45:00.760
all of that, the calculus, all of this calculus is
754
00:45:01.800 --> 00:45:06.320
a little bit is a little bit different. I also
755
00:45:06.360 --> 00:45:09.039
want to go back to again, I'm just the whole
756
00:45:09.039 --> 00:45:14.840
conversation is, you know, the the unfortunate. I'm concerned that
757
00:45:14.920 --> 00:45:19.239
the whole conversation surrounding this is evolving into hyperbole, and
758
00:45:19.280 --> 00:45:23.599
it's going to prevent good policy to be made. And
759
00:45:23.679 --> 00:45:29.559
good policy always results from conversation, discussions, and compromise. You know,
760
00:45:29.880 --> 00:45:35.760
and I already heard through through the various statements apropost
761
00:45:35.800 --> 00:45:36.800
compromise from Joe.
762
00:45:37.320 --> 00:45:41.320
But if we're just sticking at the extremes on both sides,
763
00:45:41.440 --> 00:45:43.719
we're not going to be able to have the rational
764
00:45:43.760 --> 00:45:47.239
conversation where it needs to be in the middle. So,
765
00:45:47.840 --> 00:45:50.440
you know, statements like, for example, you.
766
00:45:50.360 --> 00:45:52.880
Know, you may have been kidding Dave, I don't know,
767
00:45:52.960 --> 00:45:56.199
but statements like you'll trade one and done in the
768
00:45:56.239 --> 00:45:59.039
IPR system with one and done for infringement.
769
00:45:58.960 --> 00:46:01.599
Just doesn't make sense. It doesn't make sense.
770
00:46:02.000 --> 00:46:06.719
It's not like it's one and done for invalidity.
771
00:46:06.840 --> 00:46:07.320
Period.
772
00:46:07.920 --> 00:46:12.000
Every defendant, no matter what, will have the ability to
773
00:46:12.079 --> 00:46:16.920
defend himself in court for sure, just like the plaintiff
774
00:46:16.960 --> 00:46:21.360
has an opportunity to present the plaintiff's case in court
775
00:46:21.599 --> 00:46:25.440
in every single case. This doesn't impact the court cases
776
00:46:25.599 --> 00:46:28.079
at all, so you still have the defense there, so
777
00:46:28.119 --> 00:46:32.199
you can just you know, because you're preventing one PTO mechanism,
778
00:46:32.280 --> 00:46:38.239
now you're preventing the entire court system on the other side,
779
00:46:39.159 --> 00:46:41.320
And by the way, you're not even preventing the entire
780
00:46:41.360 --> 00:46:42.480
PTO mechanisms.
781
00:46:42.760 --> 00:46:45.199
You still have the exparte in place.
782
00:46:45.239 --> 00:46:48.559
So my only point is, you know, it's fine to
783
00:46:48.639 --> 00:46:52.039
debate whether one and Done to the world is good
784
00:46:52.039 --> 00:46:55.119
policy or not. It's fine to have that debate, but
785
00:46:55.440 --> 00:46:58.679
I would just simply stay away from these extreme hyperboles
786
00:46:58.760 --> 00:47:02.519
that divert from a potential result that results in a
787
00:47:02.599 --> 00:47:09.519
balanced system. So, for example, and I asked Joe this,
788
00:47:09.639 --> 00:47:12.719
and I will ask you as well, are you okay
789
00:47:12.760 --> 00:47:15.239
with a system that is not one and done to
790
00:47:15.320 --> 00:47:19.599
the world, but it's one and done as to a
791
00:47:19.639 --> 00:47:24.559
particular defendant or short of that, one and done as
792
00:47:24.599 --> 00:47:26.000
to a particular proceeding.
793
00:47:26.320 --> 00:47:28.480
There's various gradual gradations here.
794
00:47:28.880 --> 00:47:31.880
So my only hope is that if people don't like
795
00:47:31.960 --> 00:47:36.480
the NPRM, and again I emphasize, you know, there's legitimate
796
00:47:36.599 --> 00:47:39.639
arguments on both sides of all of these points.
797
00:47:39.280 --> 00:47:40.039
In the NPRM.
798
00:47:40.480 --> 00:47:44.559
If you don't like them, make a counter proposal that
799
00:47:44.960 --> 00:47:49.039
reaches a result that we don't have. On the one hand,
800
00:47:49.159 --> 00:47:50.920
you don't like the one and done to the world,
801
00:47:50.920 --> 00:47:55.639
but on the other hand, we also shouldn't have, you know,
802
00:47:56.239 --> 00:48:01.039
endless repetitive challenges between the same parties on the same patent,
803
00:48:01.400 --> 00:48:04.679
with the same arguments. There's lots of place in the
804
00:48:04.679 --> 00:48:07.760
middle that people can have a rational debate and reach
805
00:48:08.000 --> 00:48:09.400
a rational conclusion.
806
00:48:11.400 --> 00:48:13.280
Here's a compromise for you. I don't think you could
807
00:48:13.400 --> 00:48:13.679
like it.
808
00:48:13.760 --> 00:48:16.400
But one way to address some of the issues that
809
00:48:16.519 --> 00:48:19.159
Jonah are raising would be to have something like a
810
00:48:19.159 --> 00:48:22.239
working requirement, so you don't you don't get the benefit
811
00:48:22.360 --> 00:48:25.440
of a discretionary denial unless you're actually practicing the patent
812
00:48:25.440 --> 00:48:28.679
in the United States that you know that protects investment
813
00:48:28.679 --> 00:48:31.440
in the United States. It actually gives you additional incentive
814
00:48:31.559 --> 00:48:33.800
because you know, you get that benefit if you're.
815
00:48:33.599 --> 00:48:36.679
Working the patent. It protects small entities.
816
00:48:36.760 --> 00:48:39.679
You know, you can structure however you want, you know,
817
00:48:40.119 --> 00:48:43.840
in terms of the entity making substantial efforts to practice.
818
00:48:43.920 --> 00:48:45.880
It doesn't need that they have to be a going concern.
819
00:48:46.320 --> 00:48:50.440
That would exclude foreign companies all in the US penents,
820
00:48:50.480 --> 00:48:52.760
but don't practice the United States from getting the benefit.
821
00:48:53.039 --> 00:48:56.719
I mean something that the benefit of a discretionary is now.
822
00:48:56.880 --> 00:48:59.440
So no discretionary denial unless you're working the patent in
823
00:48:59.440 --> 00:49:02.960
the United States. That takes care of a huge portion
824
00:49:03.079 --> 00:49:06.719
of the PAE problem that concerns tech. I don't see
825
00:49:06.760 --> 00:49:09.400
how it gores the aughts of you know, if it's
826
00:49:09.400 --> 00:49:14.800
written properly of people patentees who are actually intending or
827
00:49:14.880 --> 00:49:17.119
are already in business in the United States.
828
00:49:17.440 --> 00:49:19.800
But that would seem to satisfy ten of the concerns
829
00:49:19.800 --> 00:49:20.559
on both sides.
830
00:49:22.400 --> 00:49:24.280
Ran to address it.
831
00:49:24.800 --> 00:49:27.679
Yeah, I would say it's a rather superficial look at
832
00:49:27.719 --> 00:49:31.159
how the patent system is actually used in practice. Not
833
00:49:31.280 --> 00:49:33.960
everybody patents things that they're going to turn into a product.
834
00:49:34.000 --> 00:49:37.840
Sometimes they're patenting it to license it or monetize it
835
00:49:37.880 --> 00:49:42.559
in some other way. Sometimes they're using it to maintain
836
00:49:42.599 --> 00:49:47.039
a particular market in a particular technology that is something
837
00:49:47.079 --> 00:49:50.119
other than what they've patented. So there are lots of
838
00:49:50.159 --> 00:49:52.519
different ways that people use the patent system, and I
839
00:49:52.519 --> 00:49:57.960
think history has shown that we have long since refused
840
00:49:58.119 --> 00:50:01.599
to put in place a working requirement, and I think
841
00:50:01.599 --> 00:50:03.840
the wisdom of that is self evident.
842
00:50:05.840 --> 00:50:07.639
Well, let me get.
843
00:50:07.480 --> 00:50:13.760
Back to under his point about, you know, resisting hyperbole
844
00:50:13.880 --> 00:50:19.000
and trying to reach compromise, you know, through thoughtful processes.
845
00:50:19.320 --> 00:50:21.280
I mean, it's a given that you know, we all
846
00:50:21.320 --> 00:50:24.199
approach the US patent system with good faith and the
847
00:50:24.239 --> 00:50:26.840
best for the system and the best for the country.
848
00:50:27.639 --> 00:50:28.639
But here's the question.
849
00:50:29.239 --> 00:50:33.159
You know, if both sides of the issues regarding i
850
00:50:33.199 --> 00:50:35.960
PR's or patent law reform believe that you have had
851
00:50:36.000 --> 00:50:39.519
to achieve the US Article War Section eight, Clause eight,
852
00:50:39.719 --> 00:50:43.400
the constitution goal to promote progress of science and useful
853
00:50:43.480 --> 00:50:45.639
arts and maintain fidelity.
854
00:50:45.280 --> 00:50:49.320
With fidelity with it is correct? How is that reconcilable?
855
00:50:49.920 --> 00:50:52.519
Can both use be right or does it very based
856
00:50:52.519 --> 00:50:55.239
on what the progress of science and useful arts has become?
857
00:50:55.800 --> 00:50:57.360
Or is it merely one side is right and the
858
00:50:57.440 --> 00:51:01.000
other side is wrong? Joe, would you like to tackle that?
859
00:51:04.000 --> 00:51:07.639
I'll pass on the broader philosophical stuff. I mean, everyone
860
00:51:07.760 --> 00:51:09.480
is there are different views, you know, when you talk
861
00:51:09.519 --> 00:51:11.719
to people of different industries and they just have completely
862
00:51:12.320 --> 00:51:13.880
different views of these issues.
863
00:51:13.920 --> 00:51:17.960
And frankly, you know, the life sciences.
864
00:51:17.559 --> 00:51:20.639
Litigation is just so radically different, you know, from what
865
00:51:20.719 --> 00:51:23.000
goes on in the tech space. It's it's not even
866
00:51:23.039 --> 00:51:27.840
the same, uh, you know, patent system. I just you know,
867
00:51:27.840 --> 00:51:29.960
if we're going to talk about history, I came across
868
00:51:30.000 --> 00:51:34.920
something interesting recently when he was a Secretary of State,
869
00:51:34.960 --> 00:51:38.079
Thomas Jefferson got into a back and forth discussion with
870
00:51:38.119 --> 00:51:41.480
a congressman about legislation they were considering. In the congressman
871
00:51:41.519 --> 00:51:44.000
it proposed he shouldn't we have a rule that once
872
00:51:44.159 --> 00:51:47.360
patent validity has been decided once in a case, Uh,
873
00:51:47.480 --> 00:51:48.840
you know that that should be the end of it.
874
00:51:48.880 --> 00:51:52.360
And Jefferson replied, if you do that, people will immediately
875
00:51:52.400 --> 00:51:54.840
have a collusive suit brought against them just to cut
876
00:51:54.840 --> 00:51:58.719
off future challenges. So this is a this idea, the
877
00:51:58.719 --> 00:52:02.000
one and done philosophy, is one that Thomas Jefferson, one
878
00:52:02.000 --> 00:52:06.119
of the architects of the first patent acts, rejected. Certainly,
879
00:52:06.159 --> 00:52:08.639
the members of the Federalist Society should pay some heed
880
00:52:08.679 --> 00:52:11.559
when even Thomas Jefferson considered this and told you it's
881
00:52:11.559 --> 00:52:12.400
a terrible idea.
882
00:52:13.480 --> 00:52:23.599
Well, just for the record, Thomas Jefferson was not discussing
883
00:52:23.639 --> 00:52:27.199
the America Invents Act, or the i PR system, or.
884
00:52:27.159 --> 00:52:30.760
The existing multiple parallel challenges at the same time on
885
00:52:30.800 --> 00:52:32.519
the same patent between the same parties.
886
00:52:32.960 --> 00:52:35.800
Again, again, let's just be grounded here.
887
00:52:37.360 --> 00:52:40.840
Look, the reality is the patent system from the beginning
888
00:52:40.880 --> 00:52:42.199
of time is a compromise.
889
00:52:43.360 --> 00:52:45.920
It's always a compromise between.
890
00:52:47.239 --> 00:52:52.360
The rights of the innovator to protect the invention and
891
00:52:56.280 --> 00:52:59.360
his rights for a limited period of time versus the
892
00:52:59.440 --> 00:53:03.480
right of the black towards access towards that innovation. And
893
00:53:03.639 --> 00:53:07.960
everything comes down from that quick pro quo and compromise,
894
00:53:09.199 --> 00:53:13.519
and there's a potion pull. And our system for the
895
00:53:13.559 --> 00:53:17.119
last few decades has been harmed in my opinion, by
896
00:53:17.199 --> 00:53:20.880
extreme views or one side on the other. The patent system,
897
00:53:20.960 --> 00:53:24.760
in any system of property, depends on long term stability.
898
00:53:25.559 --> 00:53:28.400
Patents and other ip rights.
899
00:53:30.079 --> 00:53:37.320
Enable investment in long term, disruptive and risky technologies.
900
00:53:38.800 --> 00:53:40.320
People who make use of the.
901
00:53:40.280 --> 00:53:45.480
System and then invest heavily in the innovation economy have
902
00:53:45.679 --> 00:53:50.000
to have a long term view and the and these
903
00:53:50.559 --> 00:53:59.000
radical moves from one side to the other increasingly fast
904
00:53:59.119 --> 00:54:02.679
at an increasingly fast space is very disruptive to our
905
00:54:02.679 --> 00:54:05.719
innovation economy and long term is going to put the
906
00:54:05.880 --> 00:54:10.480
United States at at the competitive disadvantage vis a vis
907
00:54:10.639 --> 00:54:13.320
the rest of the world. This is why it's really
908
00:54:13.360 --> 00:54:20.519
important that we try to get the sides together and
909
00:54:20.639 --> 00:54:24.440
have a rational conversation to reach long term stability.
910
00:54:25.079 --> 00:54:27.679
And look, bottom line is, and.
911
00:54:27.639 --> 00:54:30.400
I've said this for a long time, I prefer a
912
00:54:30.480 --> 00:54:37.119
legislative solution in general to enable long term stability. And
913
00:54:38.119 --> 00:54:41.480
you know, we haven't talked in detail about prevail, but
914
00:54:42.320 --> 00:54:43.159
that could be.
915
00:54:43.079 --> 00:54:47.320
The conversation for a different such channel.
916
00:54:48.920 --> 00:54:51.719
The Office, in the meantime on until there is a
917
00:54:51.880 --> 00:54:56.440
legislative solution, has to operate the system that's been given
918
00:54:56.480 --> 00:55:00.519
to it. And you know this is the the NPRM
919
00:55:00.639 --> 00:55:04.039
is an attempt to operate the system in their view, through.
920
00:55:03.960 --> 00:55:06.000
Notice and comment and give the public input.
921
00:55:06.559 --> 00:55:09.159
And and if this is not the way it's going
922
00:55:09.239 --> 00:55:10.719
to go forward, it's going to be amended.
923
00:55:11.280 --> 00:55:12.880
Let's have the rational.
924
00:55:12.480 --> 00:55:15.480
Points be brought forward and and and and fix the
925
00:55:15.559 --> 00:55:16.440
mp r M as.
926
00:55:16.320 --> 00:55:18.800
People as the consensus comes out to be.
927
00:55:19.679 --> 00:55:22.000
Fortunately, Andrew, I think the Office has put itself in
928
00:55:22.039 --> 00:55:25.320
a position where that's probably not possible. I mean, they're
929
00:55:25.360 --> 00:55:29.880
not they're not following the regulations that were promulgated before.
930
00:55:30.719 --> 00:55:33.960
There's nothing in here that cuts off discretion. You know,
931
00:55:34.039 --> 00:55:36.800
based on the Federal Circuit decision says unlikely that you
932
00:55:36.800 --> 00:55:39.679
can get an end amos an APA suit and certainly
933
00:55:39.760 --> 00:55:42.159
can't get a direct appeal of any of these decisions.
934
00:55:42.559 --> 00:55:43.239
So I mean.
935
00:55:45.199 --> 00:55:46.920
I feared that you're going to have people on my
936
00:55:47.039 --> 00:55:50.400
side who look at the regulations and say, you know,
937
00:55:51.119 --> 00:55:53.159
why would I believe that they will actually be followed?
938
00:55:53.400 --> 00:55:55.679
What possible relevance do they have?
939
00:55:55.800 --> 00:55:57.599
Why should I spend a lot of time trying to
940
00:55:57.639 --> 00:55:59.880
negotiate something that I don't believe will be buying it.
941
00:56:00.920 --> 00:56:03.920
And I think, you know, I don't mean to task
942
00:56:03.960 --> 00:56:05.000
those persons on the office.
943
00:56:05.039 --> 00:56:09.480
I'm just saying the the sentiment on my side.
944
00:56:10.039 --> 00:56:10.920
You know where we do.
945
00:56:10.960 --> 00:56:13.320
You know me, Andrew, you know, we have sat down
946
00:56:13.360 --> 00:56:16.599
and had these conversations. Normally we'd be happy to but
947
00:56:16.679 --> 00:56:20.239
in this circumstance, I can't tell my member companies that, yes,
948
00:56:20.440 --> 00:56:22.599
the PTO is going to abide by these rgs.
949
00:56:22.679 --> 00:56:25.440
Whatever we negotiate, there will be no certainty at all.
950
00:56:25.519 --> 00:56:27.519
They're not, like I said, they're not abiding by the
951
00:56:27.599 --> 00:56:29.280
rigs that were promulgated previously.
952
00:56:30.000 --> 00:56:34.800
Well, getting back to Andrea's point about, uh, you know, legislation.
953
00:56:36.519 --> 00:56:41.199
So if if Congress, I mean, in order to achieve
954
00:56:41.280 --> 00:56:44.280
stability and you know, the finality issue that we're all
955
00:56:44.320 --> 00:56:48.719
talking about as well in terms of determinations, would it
956
00:56:48.800 --> 00:56:52.039
make more sense for Congress to really take take more
957
00:56:52.159 --> 00:56:54.760
by the hornes so to speak and deal with these
958
00:56:54.800 --> 00:56:59.360
issues directly, and I would suggest that we come up
959
00:56:59.400 --> 00:57:02.719
with I've come up with an acronym epstein, which would
960
00:57:02.679 --> 00:57:08.119
probably make it sales through quite quickly. But you know,
961
00:57:08.239 --> 00:57:10.480
I'll ask each of you to just briefly say whether
962
00:57:10.559 --> 00:57:14.599
you think that a congressional response to these issues and
963
00:57:14.639 --> 00:57:18.320
what's you know, the Prevail Act, for instance, is a
964
00:57:18.320 --> 00:57:21.960
better course of action to avoid whiplash from administration to
965
00:57:22.039 --> 00:57:26.000
administration at the agency. Ryan, i'llsu first.
966
00:57:27.199 --> 00:57:30.119
Yeah, thanks, Rob Well, I agree one hundred percent with
967
00:57:30.119 --> 00:57:31.039
what Andre said.
968
00:57:31.719 --> 00:57:33.800
You know, legislation is the only way to fix this.
969
00:57:34.800 --> 00:57:39.840
It's these are invariably long term investments. They're tricky, risky investments.
970
00:57:40.719 --> 00:57:45.480
Patent system, a reliable, predictable patent system is central to that.
971
00:57:45.920 --> 00:57:48.280
And to get back to your earlier question, you know,
972
00:57:48.480 --> 00:57:52.400
since the very beginning of this nation, we wrote into
973
00:57:52.440 --> 00:57:57.559
our constitution the provision for the Patent Act. Everybody wants innovation.
974
00:57:57.719 --> 00:57:59.719
Doesn't matter what side of the coin you're on, Everybody
975
00:57:59.760 --> 00:58:02.440
wants its innovation. But the fact of the matter is,
976
00:58:02.599 --> 00:58:07.559
we created with our constitution the first patent Act of
977
00:58:07.599 --> 00:58:11.440
its kind that had not existed anywhere else in the world,
978
00:58:11.480 --> 00:58:15.119
with certain limitations that the rights would go only to
979
00:58:15.159 --> 00:58:18.519
the inventor for limited at times and their exclusive rights only.
980
00:58:19.599 --> 00:58:23.559
And as a result, we have become the most innovative
981
00:58:23.639 --> 00:58:26.920
nation the world has ever seen. And that's because of
982
00:58:26.960 --> 00:58:30.360
our legal regime. It's not something in the water here
983
00:58:30.360 --> 00:58:33.679
in the United States. It's because we have a predictable,
984
00:58:33.760 --> 00:58:36.880
reliable legal regime that protects innovators.
985
00:58:37.360 --> 00:58:39.039
And so I.
986
00:58:38.760 --> 00:58:41.920
Agree with Andre that we have to find the middle ground.
987
00:58:42.880 --> 00:58:49.559
Legislation is a tool of compromise, but I do believe
988
00:58:49.639 --> 00:58:52.360
legislation is the only way to fix this, because otherwise
989
00:58:52.719 --> 00:58:56.000
we're going to be tacking port and starboard for many
990
00:58:56.079 --> 00:58:59.719
years to come, as each administration chambers and we get
991
00:59:00.119 --> 00:59:05.159
people coming in with different ideas, So legislation is absolutely imperative.
992
00:59:06.559 --> 00:59:13.320
Joe, your feelings on having Congress correct these issues?
993
00:59:14.679 --> 00:59:16.039
Sure? You know.
994
00:59:16.079 --> 00:59:18.760
One interesting thing is we have a dozen years experience
995
00:59:18.880 --> 00:59:21.840
under the America and Men's Act and p TAP proceedings,
996
00:59:21.880 --> 00:59:24.480
and one thing we know for certain to fight all
997
00:59:24.519 --> 00:59:27.079
the attacks on the proceeding from within and without the
998
00:59:27.119 --> 00:59:30.679
agency is the proceedings actually work quite well. They work
999
00:59:31.079 --> 00:59:33.800
more or less as intended. The board is producing high
1000
00:59:33.880 --> 00:59:38.480
quality decisions. Those decisions are upheld on appeal more often
1001
00:59:38.480 --> 00:59:42.079
than district court decisions are, even though they're more reviewable,
1002
00:59:42.079 --> 00:59:44.880
because they're actually explained to the extent people of a
1003
00:59:44.920 --> 00:59:48.440
detected bias in the board's decisions and the federal circuits reversals,
1004
00:59:48.679 --> 00:59:50.800
it's been a bias in favor of patent owners. The
1005
00:59:50.800 --> 00:59:53.559
Board is much more likely to be reversed for having
1006
00:59:53.679 --> 00:59:58.199
failed to find claims unpatentable than to be reversed for
1007
00:59:58.280 --> 01:00:02.280
finding them unpatent I'd say there's a good case to
1008
01:00:02.320 --> 01:00:04.400
be made that at this point more of these issues
1009
01:00:04.400 --> 01:00:06.840
should be shifted from the Board and out of course,
1010
01:00:06.880 --> 01:00:08.920
that a broader set of issues should be allowed to
1011
01:00:08.920 --> 01:00:11.920
be raised in inter parties reviews or later in the
1012
01:00:11.960 --> 01:00:14.239
life of the patent. PGR is great, but it can
1013
01:00:14.320 --> 01:00:16.199
only be brought in the first nine months, and you
1014
01:00:16.239 --> 01:00:21.119
can't challenge every patent in your art field. Most people
1015
01:00:21.119 --> 01:00:23.880
an't going to have that budget. The problem is, though
1016
01:00:24.239 --> 01:00:28.960
legislation takes years, and it was about a ten dozen
1017
01:00:29.039 --> 01:00:30.360
year process for the AIA.
1018
01:00:31.320 --> 01:00:33.519
Right now we're facing this rig that is.
1019
01:00:33.519 --> 01:00:37.119
Literally going to cut off the ability to challenge validity
1020
01:00:37.159 --> 01:00:40.639
on improperly issued patents in hundreds of cases. If the
1021
01:00:40.679 --> 01:00:43.000
administration goes through with this rig you're going to see
1022
01:00:43.000 --> 01:00:47.320
American manufacturers get ripped off on a massive scale. Again,
1023
01:00:47.400 --> 01:00:50.679
we know these proceedings are the only reliable and consistent
1024
01:00:52.159 --> 01:00:55.280
system for reviewing these things. Why on earth the administration
1025
01:00:55.360 --> 01:00:57.960
is doing this, I frankly have no idea. It completely
1026
01:00:58.079 --> 01:01:02.119
undercuts everything that the higher level officials have said about
1027
01:01:02.119 --> 01:01:05.960
the importance of strengthening and reinforcing manufacturing capacity in the
1028
01:01:06.039 --> 01:01:06.760
United States.
1029
01:01:08.840 --> 01:01:13.079
Okay, well, I see we're kind of run over time.
1030
01:01:13.239 --> 01:01:18.639
But to Andre's point, I think it would be very
1031
01:01:18.639 --> 01:01:22.679
beneficial if we could reconvene this group and talk about
1032
01:01:23.079 --> 01:01:30.119
prevail if everyone is in agreement to that. I don't
1033
01:01:30.199 --> 01:01:34.440
run the show, but I'll certainly I'll certainly make that suggestion,
1034
01:01:34.960 --> 01:01:37.719
and I think it can happen. I want to thank
1035
01:01:37.960 --> 01:01:41.719
each one of you for all of your thoughtful comments
1036
01:01:41.880 --> 01:01:47.599
and this discussion. Hopefully we've all learned a little something.
1037
01:01:48.519 --> 01:01:51.519
I believe, as Andering points out, the best way to
1038
01:01:51.559 --> 01:01:54.199
understand your own position is really to understand the position
1039
01:01:54.280 --> 01:01:56.960
of the person who disagrees with you, and then hopefully
1040
01:01:56.960 --> 01:02:01.679
you can reach that compromise. Any last one more thoughts
1041
01:02:01.719 --> 01:02:02.199
before we.
1042
01:02:02.239 --> 01:02:06.079
End legislation, yes, but not necessarily to fix the PITA.
1043
01:02:06.239 --> 01:02:08.000
I think we might need a new solution.
1044
01:02:10.519 --> 01:02:14.719
Anyone else Okay, I guess we're at it. Thank you again.
1045
01:02:15.159 --> 01:02:18.840
I've thoroughly appreciated this conversation.
1046
01:02:19.559 --> 01:02:22.639
Thanks all, good, Thank you.
1047
01:02:23.679 --> 01:02:25.320
I'm having the four list Society.
1048
01:02:25.400 --> 01:02:29.440
Thank you so much to Andre, Joseph, David, and Brian
1049
01:02:29.559 --> 01:02:32.559
for speaking with us today and for Rob for moderating.
1050
01:02:32.800 --> 01:02:35.360
We're so grateful for your time and expertise on this
1051
01:02:35.440 --> 01:02:38.559
important topic. Thank you to our audience.
1052
01:02:38.159 --> 01:02:38.960
For joining us.
1053
01:02:39.039 --> 01:02:43.199
We really appreciate your participation. You can stay up today
1054
01:02:43.239 --> 01:02:47.199
on other announcements and upcoming webnars on our website, best
1055
01:02:47.239 --> 01:02:51.639
soft dot org. We're all major social media platforms. Thank
1056
01:02:51.679 --> 01:02:54.000
you once more for tuning in, and we are adjourned.
1057
01:02:55.280 --> 01:02:57.880
Thank you for listening to this episode of fedst Forums,
1058
01:02:58.000 --> 01:03:01.599
a podcast of the Thorough Society's practice For more information
1059
01:03:01.639 --> 01:03:04.679
about the Federal Society, the practice groups, and to become
1060
01:03:04.719 --> 01:03:07.840
a Federal Society member, please visit our website at fedsoc
1061
01:03:07.960 --> 01:03:08.639
dot org
1
00:00:02.080 --> 00:00:05.080
Welcome to fedsoc Forums, a podcast of the Federal Societies
2
00:00:05.120 --> 00:00:08.279
Practice Groups. I'm Ny kas Merrick, vice President and Director
3
00:00:08.320 --> 00:00:09.039
of Practice.
4
00:00:08.759 --> 00:00:10.039
Groups at the Federal Society.
5
00:00:10.240 --> 00:00:13.800
For exclusive access to live recordings of fedsock form programs,
6
00:00:13.919 --> 00:00:17.160
become a Federal Society member today at fedsoc dot org.
7
00:00:18.120 --> 00:00:22.199
Hello everyone, and welcome to this Federalist Society virtual event.
8
00:00:22.600 --> 00:00:25.559
My name is Sarah Clark, and I'm Assistant director of
9
00:00:25.559 --> 00:00:29.320
Practice Groups with the Federalist Society. Today we're excited to
10
00:00:29.359 --> 00:00:33.840
host his fedsoft forum called which Path for Patent Challenges,
11
00:00:34.320 --> 00:00:40.039
the USPTOS one Challenge, MPRM for Inner Parties Review. We're
12
00:00:40.200 --> 00:00:43.679
very pleased to welcome our moderator, Robert Randa, who is
13
00:00:43.719 --> 00:00:47.039
a partner at Patrick Door, where he brings over three
14
00:00:47.159 --> 00:00:51.600
decades of experience and intellectual property law. If you'd like
15
00:00:51.679 --> 00:00:55.200
to learn more about today's moderator or speakers, her full
16
00:00:55.240 --> 00:00:58.520
bios can be viewed on our website fedsock dot org.
17
00:00:59.200 --> 00:01:02.359
Throughout the program, we'll turn to the audience for questions.
18
00:01:02.719 --> 00:01:05.000
If you have a question, please enter it into the
19
00:01:05.040 --> 00:01:07.959
Q and A function at the bottom of your zoom window,
20
00:01:08.359 --> 00:01:10.840
and we'll do our boss to answer as many as
21
00:01:10.879 --> 00:01:14.680
we can. Finally, I want to know, as always, all
22
00:01:14.719 --> 00:01:18.560
expressions opinion today are those of our guest speakers, not
23
00:01:18.640 --> 00:01:22.519
the Folleralist Society. Without mister Randa, thank you so much
24
00:01:22.519 --> 00:01:25.200
for joining us today and I'll hand things over to you.
25
00:01:25.840 --> 00:01:27.319
Thank you, Sarah.
26
00:01:27.439 --> 00:01:29.640
I'd also like to thank the Federalist Society for the
27
00:01:29.680 --> 00:01:33.280
opportunity to participate at the moderator of what will undoubtedly
28
00:01:33.359 --> 00:01:37.400
be an informative and insightful discussion about the recent USPTO
29
00:01:37.560 --> 00:01:42.840
Notice of Proposed Rulemaking or MPRM change is to institution
30
00:01:43.079 --> 00:01:46.719
into Parties Review or IPR before the p TEN. I
31
00:01:46.799 --> 00:01:50.519
now have the distinct honor and privilege to introduce our panelists.
32
00:01:50.560 --> 00:01:52.120
In the interest of time, I will keep you the
33
00:01:52.120 --> 00:01:55.319
introduction brief as you would see from their extended bios
34
00:01:55.760 --> 00:01:59.239
that are available everywhere bios are available. Each panelist is
35
00:01:59.280 --> 00:02:02.079
so accomplished that their full bios would fill a large
36
00:02:02.079 --> 00:02:02.760
part of the hour.
37
00:02:03.159 --> 00:02:04.959
So first we have Andre A. Ingkoup.
38
00:02:05.200 --> 00:02:08.360
Andre is a former Under Secretary of Commerce for Intellectual
39
00:02:08.360 --> 00:02:11.599
Property and Director of US Patent and Trademark Office during
40
00:02:11.639 --> 00:02:14.479
President Trump's first term in office. He is currently a
41
00:02:14.479 --> 00:02:17.039
partner at Solomon and Cromwell and one of the leading
42
00:02:17.159 --> 00:02:21.280
voices in intellectual property law and innovation policy.
43
00:02:21.919 --> 00:02:24.319
Next we have David W. Jones.
44
00:02:24.520 --> 00:02:27.479
David is the executive director of High Tech Inventor's Alliance
45
00:02:27.520 --> 00:02:31.639
for HTIA. Prior to HTIA, David was an assistant was
46
00:02:31.719 --> 00:02:35.479
Assistant General Council for Patent Policy at Microsoft. Prior to that,
47
00:02:35.520 --> 00:02:38.960
he held multiple position on Capitol Hill. He also clerked for
48
00:02:39.000 --> 00:02:41.680
the former Chief Judge Sharon Pross on the Federal SEARCHUS
49
00:02:42.080 --> 00:02:45.639
and Judge Will Gowarod on the Fifth Circuit. Next we
50
00:02:45.759 --> 00:02:49.479
have Joseph Mattal. Joseph is the principal at clear IPLLC.
51
00:02:49.919 --> 00:02:53.120
He has served as both the USPTO Acting Director and
52
00:02:53.599 --> 00:02:56.439
Acting Solicitor. Prior to that, he served in the senior
53
00:02:56.520 --> 00:02:59.000
legal roles from more than a decade for the US
54
00:02:59.039 --> 00:03:03.080
Senate Judiciary Committee, and in that capacity he negotiated and
55
00:03:03.159 --> 00:03:06.360
drafted many of the key provisions of the invent sect
56
00:03:06.840 --> 00:03:10.120
and Next we have Brian O'Shaughnessy. Brian is a partner
57
00:03:10.159 --> 00:03:14.240
at Dinsmore and Scholl LLP, the Cherch Dinsmore IP Transaction
58
00:03:14.360 --> 00:03:18.400
and Licensing group. He has extensive experience and contested proceeding
59
00:03:18.479 --> 00:03:21.360
before the p TEP. He has also been retained as
60
00:03:21.360 --> 00:03:24.639
a testifying witness in IP and licensing disputes by the
61
00:03:24.719 --> 00:03:28.199
US Department of Justice, US Department of Treasury, and by
62
00:03:28.280 --> 00:03:32.439
various private enterprise Now, before we delve into the four
63
00:03:32.479 --> 00:03:37.840
specific categories of the NPRM, which are one required stipulation
64
00:03:37.960 --> 00:03:42.080
for efficiency to claims found invalid in prior proceedings, three
65
00:03:42.479 --> 00:03:47.080
parallel litigation, and four institutions in extraordinary circumstances, I would
66
00:03:47.199 --> 00:03:50.120
like to invite each of our speakers to provide opening
67
00:03:50.159 --> 00:03:54.360
remarks outlining their view of the NPRM. We will then
68
00:03:54.400 --> 00:03:57.800
move on to a discussion among the panelists. Director Yngkup,
69
00:03:57.800 --> 00:03:59.159
if you could please lead us off.
70
00:04:00.319 --> 00:04:04.479
Sure, thanks Rob, and great to be with all the
71
00:04:04.520 --> 00:04:07.159
panelists and all the Federal Society folks.
72
00:04:07.479 --> 00:04:08.199
Watching this.
73
00:04:10.840 --> 00:04:11.080
Look.
74
00:04:11.280 --> 00:04:15.159
The main point about the n p r M is
75
00:04:15.639 --> 00:04:19.439
that the office is taking steps to go through the
76
00:04:19.519 --> 00:04:24.759
notice and comment process to solicit views from the public
77
00:04:26.120 --> 00:04:33.920
and then make the appropriate final policy decisions, presumably taking
78
00:04:33.959 --> 00:04:39.720
into account the views from the public. And there are
79
00:04:39.800 --> 00:04:46.360
multiple points to the n p r M, and I'm
80
00:04:46.360 --> 00:04:48.439
sure we're going to touch on all of them during
81
00:04:49.040 --> 00:04:55.879
the During the panel discussion, but the key concept.
82
00:04:55.519 --> 00:05:00.480
Here seems to be an effort to.
83
00:05:00.720 --> 00:05:07.399
Align the i PR process with two core principles.
84
00:05:07.600 --> 00:05:12.399
One to have a single UH UH bite at the apple.
85
00:05:13.879 --> 00:05:21.360
At the invalidity stage or in the invalidity analysis UH
86
00:05:21.600 --> 00:05:29.120
during during an infringement case. And to give meaning to
87
00:05:30.439 --> 00:05:33.879
the original concept of the i PR system to be
88
00:05:34.959 --> 00:05:39.680
a faster alternative to disrecord litigation. So they're trying to,
89
00:05:39.920 --> 00:05:45.959
at least conceptually to UH to reduce or eliminate multiple
90
00:05:46.000 --> 00:05:49.120
attacks on the same on the validity of the same.
91
00:05:48.959 --> 00:05:51.439
Patent, and UH to.
92
00:05:53.399 --> 00:05:57.959
Effectively eliminate i prs if they are not in fact
93
00:05:58.160 --> 00:06:04.120
faster than the parallel district coort litigation. Whether whether the
94
00:06:04.240 --> 00:06:08.360
n p r M actually achieves those you know, in
95
00:06:08.399 --> 00:06:15.079
a precise in a perfectly balanced manner, or whether you
96
00:06:15.160 --> 00:06:20.399
think those requirements are good or bad for the patent system,
97
00:06:20.519 --> 00:06:23.639
that's obviously to be debated, and.
98
00:06:23.759 --> 00:06:26.360
We'll have to see what the what the public say.
99
00:06:26.439 --> 00:06:29.959
One thing I'm sure of is that the PTO will
100
00:06:29.959 --> 00:06:33.839
get a very significant number of comments, just judging by
101
00:06:34.399 --> 00:06:40.480
the comments the PTO got on prior UH such requests
102
00:06:40.680 --> 00:06:46.879
for public input on on on on p TAP policies.
103
00:06:48.040 --> 00:06:50.079
So I look forward to the to the conversation.
104
00:06:51.160 --> 00:06:54.639
Thank you, Andrea. Mister Jones, please provide your the n
105
00:06:54.720 --> 00:06:59.160
p r N. I think it's a mess. Let me
106
00:06:59.240 --> 00:07:02.519
just make three quick points. First, it's contrary to statute.
107
00:07:02.560 --> 00:07:05.040
I mean a lot of these things Congress considered and
108
00:07:05.079 --> 00:07:06.399
specifically rejected.
109
00:07:06.480 --> 00:07:08.680
And hopefully Joe will talk a little bit about that.
110
00:07:08.759 --> 00:07:10.360
He was I was the Republican.
111
00:07:09.920 --> 00:07:12.839
Staffer who kind of started off the patent reform process
112
00:07:12.879 --> 00:07:15.959
in the Senate, and Joe was the superstar who carried
113
00:07:15.959 --> 00:07:20.000
it over the finish line. The second problem with the
114
00:07:20.120 --> 00:07:21.399
rings just don't make any sense.
115
00:07:21.439 --> 00:07:22.759
I mean, they're going to lead to all sorts of
116
00:07:22.879 --> 00:07:23.720
arbitrary results.
117
00:07:23.759 --> 00:07:27.199
They based they foreclosed i prs based on non final
118
00:07:27.199 --> 00:07:31.279
decisions for example, right, So you can have all sorts
119
00:07:31.279 --> 00:07:34.079
of situations where you have an initial determination by the
120
00:07:34.079 --> 00:07:37.800
ITC that is eventually overruled by the full Commission or
121
00:07:37.879 --> 00:07:41.839
a district court summary judgment and a kind of decision
122
00:07:42.199 --> 00:07:45.480
saying that you know, this is found not invalid under
123
00:07:45.480 --> 00:07:48.000
one oh three that gets reversed by the federal by
124
00:07:48.040 --> 00:07:48.839
the Federal Circuit.
125
00:07:48.920 --> 00:07:51.199
Right, and it'll be years in between. So you're going
126
00:07:51.240 --> 00:07:53.839
to have situations where you.
127
00:07:53.879 --> 00:07:57.639
Have like a period of time where everyone is foreclosed
128
00:07:57.639 --> 00:08:00.399
from challenging the patent, and by the time the window
129
00:08:00.439 --> 00:08:03.240
opens again because they incorrect decision you know from the
130
00:08:03.240 --> 00:08:07.399
district court gets overruled. Well, most of those petitioners, maybe
131
00:08:07.439 --> 00:08:09.680
all of them, can be time bard because they're defendants
132
00:08:09.720 --> 00:08:11.839
in a lawsuit. You know, they've already been sued on
133
00:08:11.839 --> 00:08:15.480
the patent. So it basically gives the patent owner free
134
00:08:15.519 --> 00:08:19.360
reign for a long period of time, usually three years
135
00:08:19.399 --> 00:08:22.240
I think for a federal circuit decision to ascertain the
136
00:08:22.240 --> 00:08:25.759
pattern without any fear of an IPR, and it's you know,
137
00:08:25.920 --> 00:08:29.279
people call this a one and done type of approach,
138
00:08:29.920 --> 00:08:32.600
in many cases will be a zero and done type approach,
139
00:08:32.720 --> 00:08:35.639
just for exactly those reasons. Another problem I'd point out
140
00:08:35.840 --> 00:08:41.320
is that all of these provisions say that an IPR
141
00:08:41.440 --> 00:08:46.159
shall not be instituted or maintained right, So that presumably
142
00:08:46.240 --> 00:08:50.120
means that if your post final written decision and pre
143
00:08:50.960 --> 00:08:53.600
director review, right, so you already have a decision, but
144
00:08:53.639 --> 00:08:56.240
it's not final yet. If any of the things that
145
00:08:56.320 --> 00:08:58.679
you know in the second and third part of the
146
00:08:58.759 --> 00:09:02.600
Rags happen, which includes so PTO, just a siding is
147
00:09:02.639 --> 00:09:05.200
more likely than not that something will happen in the future.
148
00:09:05.919 --> 00:09:09.600
Then you lose the like basically they will dismiss the IPR,
149
00:09:10.080 --> 00:09:12.639
and then you have already signed a stipulation saying you
150
00:09:12.679 --> 00:09:15.000
can't challenge under one or two, one, O three. In
151
00:09:15.039 --> 00:09:18.639
that scenario, that petitioner not only doesn't get the benefit
152
00:09:18.679 --> 00:09:22.120
of IPR, also can't challenge it in court assuming the
153
00:09:22.159 --> 00:09:25.919
stipulation is deemed valid. So that's like three examples out
154
00:09:25.919 --> 00:09:29.720
of thousands. I think we're the real problems. And I
155
00:09:29.799 --> 00:09:32.200
say the last thing, and this kind of actually surprised me.
156
00:09:33.679 --> 00:09:39.559
The MPRM does not do almost anything to support the
157
00:09:40.360 --> 00:09:44.639
pto's conclusions or proposals with actual evidence or data. I
158
00:09:44.639 --> 00:09:46.639
mean the handful of things that they cite, you know,
159
00:09:46.679 --> 00:09:48.799
I went through them, all their sources, and half of
160
00:09:48.840 --> 00:09:52.320
them don't seem to support the contention the PTOs making
161
00:09:52.360 --> 00:09:54.639
in the first place. But they have all sorts of
162
00:09:54.759 --> 00:09:58.240
factual contentions like oh, this will save litigation costs. Well,
163
00:09:58.279 --> 00:10:01.120
we've got economic studies out there that already talked about
164
00:10:01.120 --> 00:10:03.919
how much litigation cost IPR has saved.
165
00:10:04.399 --> 00:10:06.080
You're going to forfeit that. I don't know how the
166
00:10:06.120 --> 00:10:09.679
PTO guest idea that all on balance, you're going to
167
00:10:09.720 --> 00:10:11.159
say litigation costs.
168
00:10:11.240 --> 00:10:13.559
They say that, you know, stronger patent systems, you know,
169
00:10:14.279 --> 00:10:18.879
are will address market concentration. Well, there's a bunch of
170
00:10:19.080 --> 00:10:23.159
academic papers from econmists saying the opposite. The patents are
171
00:10:23.200 --> 00:10:26.879
correlated with market concentration, not vice versa, so it really
172
00:10:27.000 --> 00:10:28.039
is unsupported.
173
00:10:28.120 --> 00:10:32.039
They use kind of skewed statistics.
174
00:10:31.279 --> 00:10:33.720
And that that surprised me because it seems like that
175
00:10:33.799 --> 00:10:36.399
might be a basis for challenge down the road, assuming
176
00:10:36.440 --> 00:10:38.679
there is any ability to challenge under the APA.
177
00:10:42.240 --> 00:10:44.240
David, mister shaughnessy.
178
00:10:45.200 --> 00:10:48.840
Thanks rod Well, I'll ancho the comments. I'm very pleased
179
00:10:48.840 --> 00:10:51.440
to be here amongst this distinguished panel and it's a
180
00:10:51.480 --> 00:10:53.480
real honor to be here. So thanks to the fed
181
00:10:53.559 --> 00:10:58.279
sock for providing this forum. You know, David raises some
182
00:10:58.519 --> 00:11:01.519
issues that are worthy of consideration, and I'm sure that
183
00:11:01.559 --> 00:11:03.799
those will find their way into his comments that he
184
00:11:03.840 --> 00:11:07.879
provides in this response to notice to proposed rulemaking, And
185
00:11:07.879 --> 00:11:10.960
that's the purpose of this webinar, but it's also the
186
00:11:11.000 --> 00:11:14.720
purpose of the NPRM is to hear from the practitioners
187
00:11:15.240 --> 00:11:18.080
about how the proposed rules might actually be.
188
00:11:18.080 --> 00:11:19.559
Put into practical effect.
189
00:11:21.360 --> 00:11:25.000
I think personally that the proposed rules make a lot
190
00:11:25.000 --> 00:11:27.759
of sense. They bring a lot of balance, They bring
191
00:11:28.559 --> 00:11:32.159
a lot of corrective measures, if you will, to the
192
00:11:32.200 --> 00:11:35.679
way that the IPR system has been implemented. We all
193
00:11:35.799 --> 00:11:38.840
know that the AIA had as one of its objective
194
00:11:38.960 --> 00:11:43.519
to bring greater reliability and transparency to the patent system
195
00:11:43.919 --> 00:11:48.720
and to give people an alternative to litigation. We also
196
00:11:48.840 --> 00:11:52.039
know that the IPR process is one of only three
197
00:11:52.399 --> 00:11:57.279
post grant processes available to challengers at the PTO, and
198
00:11:57.360 --> 00:12:00.799
of course there are the courts and the ITC. So
199
00:12:01.279 --> 00:12:05.320
there are plenty of avenues by which challengers can go
200
00:12:05.440 --> 00:12:09.960
after a particular patent, and I think they have the
201
00:12:10.039 --> 00:12:14.600
opportunity to file PGRs. For example, early on PGRs are
202
00:12:14.679 --> 00:12:15.919
properly time barred.
203
00:12:16.559 --> 00:12:17.919
They give the patent owner.
204
00:12:18.080 --> 00:12:21.440
If we had only PGRs, we'd probably be better off.
205
00:12:21.759 --> 00:12:25.559
They give the patent owner the opportunity to rely on
206
00:12:25.679 --> 00:12:30.679
quiet title to their asset. And so there are lots
207
00:12:30.679 --> 00:12:33.799
of things that we need to do to remedy the
208
00:12:33.840 --> 00:12:38.679
current situation because quite frankly, the IPRs haven't been an
209
00:12:38.679 --> 00:12:43.919
alternative to litigation. They've been an adjunct to litigation, and
210
00:12:44.120 --> 00:12:48.519
this has in fact only raised expense. It's delayed the
211
00:12:48.679 --> 00:12:53.159
decision to a final decision on the validity of a
212
00:12:53.200 --> 00:12:57.639
particular patent, and this has worked to enormous detriment to
213
00:12:57.799 --> 00:13:02.600
our innovation economy. So I disagree with Dave that patents
214
00:13:02.639 --> 00:13:04.720
don't really do the system any good. I think the
215
00:13:04.759 --> 00:13:09.600
patents have been shown to be enormously beneficial, particularly to
216
00:13:09.679 --> 00:13:13.679
the disruptive innovator who doesn't have the assets and the
217
00:13:13.720 --> 00:13:17.919
resources that the incumbents have. So I think bringing some
218
00:13:18.039 --> 00:13:21.559
balance looking at the IPR system in terms of how
219
00:13:21.600 --> 00:13:25.679
it affects the actual patent owners and particularly the innovators
220
00:13:26.759 --> 00:13:31.279
is well placed and these rules make a lot of
221
00:13:31.320 --> 00:13:33.679
sense and I think bring a lot more balance back
222
00:13:33.720 --> 00:13:34.639
into the program.
223
00:13:35.720 --> 00:13:39.039
Thank you Brian, mister Mattow, he's rounded out with you
224
00:13:39.080 --> 00:13:42.759
of huge thank you. You know, it's kind of hard
225
00:13:42.799 --> 00:13:44.840
to take the MPR seriously.
226
00:13:45.639 --> 00:13:48.799
It's basically a set of arbitrary restrictions that are designed
227
00:13:48.840 --> 00:13:50.159
to cut off access.
228
00:13:49.799 --> 00:13:52.559
To review, including for people who are being sued.
229
00:13:53.960 --> 00:13:56.440
The most problematic rule is the one and done role
230
00:13:56.480 --> 00:13:59.480
that if anyone in any forum has ever challenged the patent,
231
00:14:00.120 --> 00:14:03.840
then you can't challenge it if you're sued a decade later,
232
00:14:04.559 --> 00:14:06.879
even if you never knew about the previous suit, The
233
00:14:06.919 --> 00:14:10.600
previous challenge can even be in the ITC proceedings don't
234
00:14:10.600 --> 00:14:13.960
create a stopple against later enforcement of the patent, even
235
00:14:14.000 --> 00:14:17.279
if they find the patent invalid. They include X party
236
00:14:17.320 --> 00:14:21.279
re examine, which parties can't even participate once the proceeding
237
00:14:21.320 --> 00:14:21.879
has started.
238
00:14:21.879 --> 00:14:26.039
But most fundamentally, there's this old Anglo.
239
00:14:25.679 --> 00:14:29.200
American principle that if you're sued, you're allowed to present
240
00:14:29.240 --> 00:14:30.960
your own defense. It was in two thousand and eight
241
00:14:31.000 --> 00:14:34.080
and the Sturgil case that the Supreme Court rejected the
242
00:14:34.120 --> 00:14:37.960
concept of virtual representation, that you don't have the right
243
00:14:38.000 --> 00:14:40.600
to present your own defense because somebody else represented you
244
00:14:40.639 --> 00:14:44.679
somewhere else. Another key feature of the rules is this
245
00:14:45.120 --> 00:14:47.759
timing with district court litigation that if the district court's
246
00:14:47.799 --> 00:14:51.879
going to get to trial faster, we should cut off review. Principally,
247
00:14:51.960 --> 00:14:54.360
that means if you're sued in East Texas, where the
248
00:14:54.399 --> 00:14:57.159
average time to trial is in about sixteen months, then
249
00:14:57.159 --> 00:14:59.120
you don't have the right to challenge the patent at
250
00:14:59.120 --> 00:15:01.039
the board again, even if you're being sued on it
251
00:15:01.480 --> 00:15:05.039
by someone demanding millions, and about ninety percent of the
252
00:15:05.080 --> 00:15:08.960
litigation in East Texas is NPE litigation. Why on earth
253
00:15:09.000 --> 00:15:13.799
we would privilege that, of all things, is completely beyond me.
254
00:15:14.399 --> 00:15:16.159
So what does this mean in practice?
255
00:15:16.679 --> 00:15:18.080
Just in the news the other day there was a
256
00:15:18.120 --> 00:15:22.639
story about Micron appealing a four hundred million dollars verdict
257
00:15:22.679 --> 00:15:26.200
against it in East Texas and the patents, you know,
258
00:15:26.240 --> 00:15:28.120
they were sued earlier, so they were still able to
259
00:15:28.159 --> 00:15:31.320
challenge the pattern. There's a copeending appeal of a p
260
00:15:31.480 --> 00:15:34.120
TAB decision saying these claims are invalid. This is the
261
00:15:34.200 --> 00:15:36.480
technical experts of the board looked at it and decided
262
00:15:36.559 --> 00:15:39.039
this was already known. There are plenty of other suits
263
00:15:39.039 --> 00:15:42.559
against Micron, mostly by mpes, some by y MTC, a
264
00:15:42.679 --> 00:15:45.480
state owned company. In the future, are we're really going
265
00:15:45.519 --> 00:15:48.000
to cut off the ability of Micron and companies like
266
00:15:48.080 --> 00:15:51.159
that to protect itself against the patent that's not valid?
267
00:15:51.720 --> 00:15:55.159
And one final thing, there's this A lot of this
268
00:15:55.240 --> 00:15:58.399
is premised on the notion that district court litigation is
269
00:15:58.519 --> 00:15:59.279
just as good.
270
00:15:59.279 --> 00:16:00.960
A forum for testing these things.
271
00:16:01.480 --> 00:16:04.080
Like since the seventies, we've shifted mainly to doing jury
272
00:16:04.200 --> 00:16:08.440
trials in these cases. Very few jurors have a technical background,
273
00:16:08.879 --> 00:16:11.279
often very skilled truck trial lawyers will tell you not
274
00:16:11.360 --> 00:16:14.200
even to bother present a paper base of patents and
275
00:16:14.240 --> 00:16:17.799
credit publications, obviousness defense do in jury juries are not
276
00:16:18.000 --> 00:16:21.960
going to engage on what was obvious and Semiconductor designed
277
00:16:22.000 --> 00:16:26.360
circuit two thousand and seven. At best, they're inconsistent about it.
278
00:16:26.399 --> 00:16:30.399
And when you get repeated suits, you will have invalid
279
00:16:30.440 --> 00:16:33.679
patents and forced for very high amounts. And I hope
280
00:16:33.679 --> 00:16:36.480
the administration really thinks about this, like how many hits
281
00:16:36.480 --> 00:16:40.360
do you want companies like Micron or Semiconductors and others
282
00:16:40.399 --> 00:16:43.720
to take for hundreds of millions sometimes billions of dollars
283
00:16:44.000 --> 00:16:45.919
for a patent that if they were allowed to challenge
284
00:16:45.960 --> 00:16:48.840
it before the technical experts at the agency, they would
285
00:16:48.879 --> 00:16:52.720
agree that it's not valid. And I've talked to many
286
00:16:52.759 --> 00:16:54.960
people on the life sciences side who think, you know,
287
00:16:55.000 --> 00:16:58.000
we don't really need IPRs, et cetera. And the life
288
00:16:58.000 --> 00:17:01.240
sciences is different, Okay, the quality is higher there. It's
289
00:17:01.279 --> 00:17:04.759
mostly judge trials and you know VIA and the cases.
290
00:17:04.799 --> 00:17:08.319
But I also think back to a line from Bob Armitage,
291
00:17:08.319 --> 00:17:10.759
who was heavily involved in the AI, was General counsel
292
00:17:10.799 --> 00:17:13.440
of Eli Lilly at the time, he warn't people, if
293
00:17:13.480 --> 00:17:16.480
you like patents, if you love patents, do you love
294
00:17:16.519 --> 00:17:20.319
your children? You know most people love their children too.
295
00:17:20.440 --> 00:17:23.079
If your children are misbehaving, don't you want to correct
296
00:17:23.079 --> 00:17:26.640
their behavior? And the folks out there who love patents,
297
00:17:26.680 --> 00:17:29.359
if you see the system being abused, if it's seeing
298
00:17:30.279 --> 00:17:33.799
you know, if if you see it patent's misbehaving, in effect,
299
00:17:34.240 --> 00:17:36.440
you want to correct that behavior because you'll be the
300
00:17:37.319 --> 00:17:41.680
most gentle disciplinarian. And the backlash that's going to come
301
00:17:41.880 --> 00:17:44.359
if we allow things like this to go forward and
302
00:17:44.480 --> 00:17:49.319
literally just immunize patents that never should have issued and
303
00:17:49.359 --> 00:17:55.240
are being asserted by mpees, this is just this is doing.
304
00:17:55.680 --> 00:17:59.200
We're doing severe damage to the integrity and legitimacy of
305
00:17:59.240 --> 00:18:02.799
the system with this NPRM. I very much hope the
306
00:18:02.839 --> 00:18:04.519
administration reconsiders this.
307
00:18:06.480 --> 00:18:06.839
Well.
308
00:18:07.480 --> 00:18:17.400
Thank you, Joseph. Before we get into the individual provisions, Joseph,
309
00:18:17.599 --> 00:18:21.839
you brought up misbehaving patents, and I guess the question
310
00:18:21.960 --> 00:18:25.160
I have is did they misbehaved.
311
00:18:24.519 --> 00:18:27.559
Before the AIA or were they? Were they good.
312
00:18:27.480 --> 00:18:31.559
Children before the AI had inner parties re examinations which
313
00:18:31.680 --> 00:18:35.440
actually had the same scope of challenge. The problem with
314
00:18:35.480 --> 00:18:38.359
inter party the reason the system was upgraded in the
315
00:18:38.400 --> 00:18:43.240
AIA was just the structure of inn Parties reexams made
316
00:18:43.279 --> 00:18:45.599
them impossible to get done in a timely manner. They
317
00:18:45.720 --> 00:18:48.720
pretty routinely dragged out for six or seven years. In fact,
318
00:18:49.200 --> 00:18:51.920
I believe there are still two or three Inner Parties
319
00:18:51.960 --> 00:18:55.519
re exams that are still pending, even though the deadline
320
00:18:55.559 --> 00:18:58.799
for filing them expired in twenty twelve. These are cases, obviously,
321
00:18:58.960 --> 00:19:01.759
but procedure can be dragged out that long that either
322
00:19:01.799 --> 00:19:06.160
party can kind of delay it will is not useful
323
00:19:06.720 --> 00:19:09.519
as a check on validity when you have copending litigation.
324
00:19:10.319 --> 00:19:13.160
But the decision to go back to the agency goes
325
00:19:13.200 --> 00:19:16.039
back to nineteen eighty You validity review has always been
326
00:19:16.079 --> 00:19:20.079
available in course, but over the course of the twentieth century,
327
00:19:20.079 --> 00:19:22.880
Congress heard enough complaints about this. I decided, you know,
328
00:19:22.920 --> 00:19:25.000
we really need technical experts to be able to look
329
00:19:25.000 --> 00:19:28.319
at this. In the eighties, they created XPARTI re Exam.
330
00:19:28.400 --> 00:19:30.559
Then they decided, you know, you really need both parties
331
00:19:30.559 --> 00:19:33.279
to be able to participate. They turn they and then
332
00:19:33.319 --> 00:19:36.480
added Inner Parties re Exam. But Inner Party's reexam just
333
00:19:36.519 --> 00:19:40.240
became dysfunctional. You know, the point of the AI wasn't
334
00:19:40.279 --> 00:19:42.400
just to make it faster and quicker, but it's that
335
00:19:42.440 --> 00:19:46.119
original idea that, especially for these complex technologies, you're not
336
00:19:46.200 --> 00:19:49.519
going to get an accurate and reliable decision on validity
337
00:19:49.880 --> 00:19:53.440
other than from technical experts.
338
00:19:53.880 --> 00:19:58.559
So, Andre, David and Joseph have pointed to a lot
339
00:19:58.599 --> 00:20:03.240
of flaws that they see in the npr M, and
340
00:20:04.200 --> 00:20:09.000
Joseph points out misbehaving patents, which I think might be
341
00:20:09.000 --> 00:20:14.319
better characterized as misbehaving litigants in the courts. But can
342
00:20:14.359 --> 00:20:17.880
you maybe address some of the floors and pointed out
343
00:20:18.440 --> 00:20:21.839
and you know, you highlighted the motivation.
344
00:20:21.559 --> 00:20:22.440
For the npr M.
345
00:20:22.720 --> 00:20:26.200
I don't think anybody, well people may disagree with the motivation,
346
00:20:26.359 --> 00:20:28.599
but can you maybe take on some of those floors
347
00:20:28.640 --> 00:20:30.880
and tell us whether they're right or wrong.
348
00:20:32.839 --> 00:20:36.200
Well, look, first of all, I do want to emphasize that.
349
00:20:36.680 --> 00:20:40.119
This is exactly the process that's supposed to take place.
350
00:20:41.680 --> 00:20:47.240
In a notice in common rulemaking exercise. Folks who have
351
00:20:48.960 --> 00:20:49.720
different points of.
352
00:20:49.759 --> 00:20:53.480
View make them known, and then the administration will consider
353
00:20:53.519 --> 00:20:59.160
them all. So I hope folks that across the various
354
00:20:59.160 --> 00:21:04.079
interests he do that. And I think that will result
355
00:21:05.039 --> 00:21:08.200
in a better rule package at the end of the day.
356
00:21:10.039 --> 00:21:14.799
And you know, but but we have to be careful
357
00:21:15.200 --> 00:21:15.640
with the.
358
00:21:15.640 --> 00:21:18.640
Language that we're using here and and try to stay
359
00:21:18.680 --> 00:21:24.559
away from from hyperbole. So let me just address a
360
00:21:24.599 --> 00:21:29.400
couple of of the points that.
361
00:21:28.480 --> 00:21:34.000
That have been raised just on a factual basis. Uh, David,
362
00:21:34.039 --> 00:21:34.759
You mentioned that.
363
00:21:36.200 --> 00:21:39.799
The NPRM forecloses i PR is based on non final decisions,
364
00:21:40.319 --> 00:21:44.240
and you're right in the in the reading of the
365
00:21:44.359 --> 00:21:49.000
of the rule proposal, which is, you know, if there
366
00:21:49.079 --> 00:21:52.559
is a summary judgment ruling or a jury verdict, the
367
00:21:53.759 --> 00:22:00.599
stopple effectively applies at that point when there are rulings
368
00:22:00.599 --> 00:22:04.960
from the district coords that find the patent not invalid.
369
00:22:06.039 --> 00:22:09.200
And your point was, well, those can be reversed on appeal.
370
00:22:10.039 --> 00:22:15.839
Okay, but let's just think through the alternatives here. The
371
00:22:15.880 --> 00:22:20.839
district coord in those examples found the patent not invalid
372
00:22:21.279 --> 00:22:26.079
if it goes on appeal, two possible outcomes theoretically, obviously,
373
00:22:26.319 --> 00:22:30.240
there are many others. Just theoretically, Either the Federal Circuit
374
00:22:30.680 --> 00:22:34.599
affirms what was just found and therefore the patent is
375
00:22:34.640 --> 00:22:38.599
still not invalid, and in that case there's no reason
376
00:22:38.720 --> 00:22:43.079
not to attach the estopel at the earlier point in time,
377
00:22:43.200 --> 00:22:47.000
why wait another year and a half. On the other hand,
378
00:22:47.559 --> 00:22:58.200
if if the Federal Circuit finds the patent invalid, then
379
00:22:58.240 --> 00:23:03.720
the patent's gone and everything thing goes away, including the
380
00:23:03.799 --> 00:23:08.480
litigation and the patent completely, you don't need at that point.
381
00:23:08.480 --> 00:23:11.599
If the Federal Circuit speaks and the Federal Circuit has
382
00:23:11.599 --> 00:23:15.200
found the patent invalid, you no longer need an IPR
383
00:23:15.279 --> 00:23:19.039
process obviously at that point in time. So in either circumstance,
384
00:23:20.200 --> 00:23:24.279
from just from that pure technical perspective, I don't think
385
00:23:24.319 --> 00:23:31.119
that's that that is necessarily you know, a reason to
386
00:23:31.200 --> 00:23:33.279
find meaningful fault here.
387
00:23:33.359 --> 00:23:35.559
Now you can argue.
388
00:23:37.079 --> 00:23:40.720
On the other point that mister Jones has made, which is,
389
00:23:42.920 --> 00:23:45.559
you know, the pure one and done type of an approach,
390
00:23:45.640 --> 00:23:48.599
which is and I think Joe made the same point,
391
00:23:48.640 --> 00:23:49.279
which is.
392
00:23:49.839 --> 00:23:52.400
Look, why should.
393
00:23:53.720 --> 00:23:58.960
The results coming from a different litigation prosecuted by a
394
00:23:59.000 --> 00:24:02.920
different party, completely unrelated into the long distance in time
395
00:24:03.400 --> 00:24:07.720
and perhaps over different you know, different acoust products, et cetera,
396
00:24:07.799 --> 00:24:08.240
et cetera.
397
00:24:08.319 --> 00:24:10.000
Why should that preclude others?
398
00:24:10.519 --> 00:24:12.799
And I have to say that is a fair debate,
399
00:24:13.240 --> 00:24:17.680
and there are policy reasons to go either way, But
400
00:24:17.839 --> 00:24:20.559
it is a fair debate. But one thing I will say,
401
00:24:20.920 --> 00:24:24.920
and again to avoid hyperbole here, it's not that if
402
00:24:25.759 --> 00:24:29.920
if you go and you accept the nprm's approach to
403
00:24:29.960 --> 00:24:32.920
that policy, if that's what comes out, it doesn't mean
404
00:24:32.960 --> 00:24:37.319
that the world has collapsed and defendants have no way
405
00:24:37.400 --> 00:24:39.920
to challenge the validity of a patent anymore, and then
406
00:24:40.000 --> 00:24:44.359
that's it. Billions of dollars will be, you know, forever
407
00:24:44.440 --> 00:24:50.480
at risk without recourse. The defendants can still defend themselves,
408
00:24:50.519 --> 00:24:54.960
obviously in the disrecord litigation or the ITC litigation, just.
409
00:24:54.880 --> 00:24:57.559
As they have been from the beginning of the patent system.
410
00:24:58.000 --> 00:25:00.680
They can still go to that pattern into office if
411
00:25:00.680 --> 00:25:03.240
they want and do expart their re examinations.
412
00:25:03.680 --> 00:25:08.480
That is still a viable approach.
413
00:25:09.400 --> 00:25:14.559
I am not saying that that is the correct policy position.
414
00:25:15.759 --> 00:25:19.519
I acknowledge that there are legitimate debates on both sides,
415
00:25:20.240 --> 00:25:23.319
and I don't need to repeat, but David and Joe
416
00:25:23.440 --> 00:25:27.519
have made the policy argument why that would not be
417
00:25:27.599 --> 00:25:32.039
fair to the particular litigant in this particular case. On
418
00:25:32.079 --> 00:25:36.680
the other side, one can argue the patent owners might argue, well, look,
419
00:25:36.720 --> 00:25:39.759
you need quiet title and the PTO has already. You know,
420
00:25:40.319 --> 00:25:43.160
an adjudicave body has already looked at the validity of
421
00:25:43.200 --> 00:25:48.799
this thing. And a patent is an objective document, and
422
00:25:49.000 --> 00:25:54.400
once the judiciary, in whatever format, has passed on it, then.
423
00:25:55.119 --> 00:25:57.160
Why should the judiciary look at it again?
424
00:25:57.960 --> 00:26:02.839
Now, I really do understand the practical considerations that nothing
425
00:26:02.920 --> 00:26:06.200
is purely objective in this in this world, and claim
426
00:26:06.240 --> 00:26:08.759
constructions can be different, the scope of claims can be
427
00:26:08.799 --> 00:26:11.640
interpreted differently based on the infringement.
428
00:26:11.079 --> 00:26:13.240
Allegations in a particular case, and all of that.
429
00:26:13.519 --> 00:26:16.799
But my only point is that that is a fair
430
00:26:16.880 --> 00:26:21.799
debate and we should avoid the extreme hyperbole on both sides.
431
00:26:22.240 --> 00:26:27.359
One final point to go to to address one one
432
00:26:27.359 --> 00:26:35.599
point that Joe made. Joe Joey fundamentally seemed to reject jury,
433
00:26:37.039 --> 00:26:41.359
the role of juries, at least on the validity analysis.
434
00:26:41.839 --> 00:26:47.400
But look, the reality is, the jury system is fundamental
435
00:26:47.960 --> 00:26:52.279
to the American judicial process. It's in our constitution. It's
436
00:26:52.319 --> 00:26:56.440
it's it's there, it's there twice, it's in the body
437
00:26:56.559 --> 00:27:02.039
and in the amendments to be frank and and it's
438
00:27:02.079 --> 00:27:06.279
been a core part of our system of laws from
439
00:27:06.279 --> 00:27:10.119
the beginning of time. And if you don't trust the
440
00:27:10.200 --> 00:27:18.559
jury system, then we have bigger problems with our judicial
441
00:27:18.640 --> 00:27:27.400
system then patent validity challenges. But I'll say this, I
442
00:27:27.440 --> 00:27:31.160
think it's a fair debate. You know that you're pointing
443
00:27:31.200 --> 00:27:35.680
out our juries technically equipped or not to hear patent cases.
444
00:27:35.720 --> 00:27:38.799
And countries around the world have had that debate. And
445
00:27:39.680 --> 00:27:41.960
you know, we are still here in the United States
446
00:27:42.000 --> 00:27:44.680
on the side of jury trials. Other countries do not
447
00:27:44.759 --> 00:27:50.279
have them. But when it comes to the validity question,
448
00:27:52.000 --> 00:27:56.039
if you do not like you don't trust the juries,
449
00:27:56.559 --> 00:28:01.839
or a particular defendant does not trust jurys, then that
450
00:28:01.920 --> 00:28:06.200
defendant can go and do an IPR. But just do
451
00:28:06.359 --> 00:28:10.039
the IPR. Then the biggest problem that I've had was
452
00:28:10.079 --> 00:28:18.359
with the insistence on both. And if one of your clients,
453
00:28:18.400 --> 00:28:22.640
Joe says, look, I agree with you. I don't think
454
00:28:22.680 --> 00:28:26.279
a jury is capable to understand my complicated technology here,
455
00:28:26.640 --> 00:28:29.599
and from a validity point of view, I don't think
456
00:28:29.599 --> 00:28:32.119
we should give it to the jury, So let's give
457
00:28:32.119 --> 00:28:35.559
it to the PETAB. But in that case, why also
458
00:28:35.680 --> 00:28:40.880
maintain the parallel ability to do the jury as well?
459
00:28:41.720 --> 00:28:45.640
And you know this hasn't come up yet here in
460
00:28:45.680 --> 00:28:50.480
this discussion, but you know there is the prevailabill out there,
461
00:28:51.599 --> 00:28:56.039
and that's what that bill tries to accomplish. It's like, okay,
462
00:28:56.359 --> 00:29:01.000
each defendant can pick and it's the choice of the defendant.
463
00:29:00.920 --> 00:29:01.759
And you pick one.
464
00:29:02.920 --> 00:29:06.200
You pick the jury or the court system, or you
465
00:29:06.279 --> 00:29:10.119
pick the p tap system, but not both. So you've
466
00:29:10.119 --> 00:29:13.599
got to pick, you know, the The concept in general
467
00:29:13.640 --> 00:29:19.359
here is pick the horse you're going to ride, but
468
00:29:19.599 --> 00:29:27.640
don't do it. Don't do both. And that goes a
469
00:29:27.640 --> 00:29:31.240
little bit beyond this npr N because this NPRM has
470
00:29:31.480 --> 00:29:35.000
other issues beyond just picking one or the other for
471
00:29:35.079 --> 00:29:40.160
one particular defendant. But conceptually, I think that's a debate
472
00:29:41.519 --> 00:29:44.559
that's an issue worth discussing and resolving.
473
00:29:44.839 --> 00:29:48.400
Frankly, well, thank you, Andre Dave.
474
00:29:48.480 --> 00:29:51.440
I want to give you an opportunity to respond to
475
00:29:51.799 --> 00:29:55.599
areas that Andrea has said. But Joe, first, I want
476
00:29:55.640 --> 00:29:58.759
to give you the opportunity to respond to being criticized,
477
00:29:58.960 --> 00:30:01.039
not like the jury.
478
00:30:01.319 --> 00:30:05.400
Okay, well, look under the system you're describing, you know,
479
00:30:05.400 --> 00:30:08.519
where you're forced to choose it is. You know, it's
480
00:30:08.599 --> 00:30:10.880
cultorably and reasonable. We could have that debate. You're basically
481
00:30:10.880 --> 00:30:13.039
describing the system you left in place when you left
482
00:30:13.039 --> 00:30:16.759
the agency. That is not what the NPRM does. Under
483
00:30:16.759 --> 00:30:19.880
the NPRM. Literally again, like someone else was sued ten
484
00:30:19.960 --> 00:30:24.279
years earlier and couldn't bring a challenge, brought an unsuccessful challenge.
485
00:30:24.440 --> 00:30:26.400
Now you can't bring a challenge and doing a.
486
00:30:26.319 --> 00:30:30.039
So terrorist stipulation, et cetera isn't going to overcome the
487
00:30:30.119 --> 00:30:31.440
rules that they could in place.
488
00:30:31.440 --> 00:30:31.759
Here.
489
00:30:32.279 --> 00:30:34.440
They seem to not even have the stipulation in the
490
00:30:35.279 --> 00:30:39.400
parallel proceedings provision. You literally will you know, it doesn't
491
00:30:39.440 --> 00:30:41.720
matter what the case is. Someone else was sued earlier,
492
00:30:41.799 --> 00:30:44.279
or you're suited in a fast moving district and you
493
00:30:44.400 --> 00:30:48.680
cannot go to an inner party is proceeding before the agency.
494
00:30:49.119 --> 00:30:51.680
And it's great that everyone loves juries. Juries are good
495
00:30:51.680 --> 00:30:53.240
at a lot of things. They can tell when people
496
00:30:53.279 --> 00:30:56.119
are lying. But again, your typical jury does not have
497
00:30:56.200 --> 00:30:59.759
a technical background. In the few cases where people present
498
00:30:59.799 --> 00:31:02.880
these defenses and they're they're able to interview the jurors later,
499
00:31:02.960 --> 00:31:06.680
they routinely discover it was the jury deliberations were a disaster.
500
00:31:06.880 --> 00:31:09.759
The jury did not engage at all with the technology. Look,
501
00:31:09.799 --> 00:31:12.519
a lot of this stuff is just very complex and
502
00:31:12.559 --> 00:31:16.519
having the technical background to at least no understand the
503
00:31:17.160 --> 00:31:20.880
you know, the prior art is a critical element to
504
00:31:20.920 --> 00:31:25.240
being able to accurately and reliably assess you know, you
505
00:31:25.279 --> 00:31:27.759
know whether that you know whether this was obvious or not.
506
00:31:28.279 --> 00:31:31.119
You know, jurors tend to be motivated by things like narratives.
507
00:31:31.119 --> 00:31:33.880
When you just when you watch the way really good
508
00:31:33.920 --> 00:31:37.119
trial lawyers prepare for this. It's all about our narratives
509
00:31:37.160 --> 00:31:39.960
and our themes and uh, it's not about are the
510
00:31:40.000 --> 00:31:42.279
limitations to the claim meant by the prior art?
511
00:31:43.039 --> 00:31:44.319
And again, this is we've had.
512
00:31:44.680 --> 00:31:47.799
You know, the Supreme Court started talking about the need
513
00:31:47.880 --> 00:31:50.920
for technical experts in patent cases going.
514
00:31:50.720 --> 00:31:52.880
Back to the nineteenth century, learned and.
515
00:31:53.440 --> 00:31:55.680
Denounced how ridiculous it is that he is a judge,
516
00:31:55.680 --> 00:31:57.880
had to learn this stuff and that we needed some
517
00:31:57.920 --> 00:32:00.480
system like that. This was it was a long debate
518
00:32:00.519 --> 00:32:04.039
building up to the creation of these post issuance proceedings.
519
00:32:04.079 --> 00:32:07.799
And it's pretty clear what's going to happen if you
520
00:32:07.880 --> 00:32:11.559
cut these off. You're going to immunize invalid patterns and
521
00:32:11.599 --> 00:32:15.000
make it impossible to effectively challenge them. And again, like
522
00:32:15.039 --> 00:32:17.960
how many multi hundred million dollar hits do we want
523
00:32:18.440 --> 00:32:21.880
Micron technology or chip makers to make. These are big companies.
524
00:32:21.920 --> 00:32:24.640
But that's money they could spend on R and D.
525
00:32:24.720 --> 00:32:28.079
And I'll tell you some of these very companies have
526
00:32:28.880 --> 00:32:32.720
expressed in our private discussions that this is existential for them.
527
00:32:32.839 --> 00:32:36.000
If they don't have access to some way to challenge
528
00:32:36.039 --> 00:32:38.839
these cases in the MP suits they're facing in Texas,
529
00:32:39.240 --> 00:32:42.200
it will eventually run them out of business. So again,
530
00:32:42.240 --> 00:32:45.559
I just hope that administration someone talks sense into the
531
00:32:45.599 --> 00:32:48.599
people up there. Jdevans has said all these very intelligent
532
00:32:48.640 --> 00:32:51.519
things about manufacturing, how you can't give up.
533
00:32:51.480 --> 00:32:52.920
The ability to make things.
534
00:32:52.920 --> 00:32:55.839
You're eventually going to be impoverished if you forget how.
535
00:32:55.759 --> 00:32:56.160
To make things.
536
00:32:56.200 --> 00:32:58.279
A lot of innovation just comes out of the process
537
00:32:58.680 --> 00:33:03.039
of mastering the manufacturer. If we let companies like Micron
538
00:33:03.160 --> 00:33:05.920
be run out of business or or hobbled, you know,
539
00:33:06.000 --> 00:33:09.759
our manufacturing strategy is get your dram memories from China.
540
00:33:09.920 --> 00:33:15.279
That's the administration's manufacturing strategy. If they go forward with
541
00:33:15.839 --> 00:33:18.720
some of the ridiculous things in this NPR M.
542
00:33:19.160 --> 00:33:21.640
Okay, I mean, look again, I really think we should
543
00:33:21.640 --> 00:33:22.960
avoid hyperbole here.
544
00:33:23.400 --> 00:33:24.160
They're there.
545
00:33:25.359 --> 00:33:32.119
It's just because you have to litigate a patent in
546
00:33:32.200 --> 00:33:36.799
court or at the ITC or through X part eary exam.
547
00:33:36.920 --> 00:33:39.759
Just because this one tool is unavailable in a particular
548
00:33:39.799 --> 00:33:44.640
case doesn't mean that the United States manufacturing infrastructure collapses.
549
00:33:44.680 --> 00:33:48.200
I'm not debating whether you like the mp RM or not.
550
00:33:48.559 --> 00:33:50.720
There definitely points to be discussed.
551
00:33:50.960 --> 00:33:55.640
But again, I think we're going to lose perspective on
552
00:33:57.000 --> 00:34:01.119
creating a better system if we gauge in this type
553
00:34:01.119 --> 00:34:04.839
of hyperbole. But on the jury point, I just want
554
00:34:04.880 --> 00:34:12.880
to ask you, Joe, a direct question. Accepting hypothetically what
555
00:34:12.920 --> 00:34:15.119
you just said, the juries are not capable of doing that,
556
00:34:15.199 --> 00:34:18.400
and you know some cases are definitely technology is more complicated,
557
00:34:18.480 --> 00:34:21.239
and in that particular case, you really don't think the
558
00:34:21.320 --> 00:34:24.320
jury can do it, and you want the experts of
559
00:34:24.360 --> 00:34:27.639
the pe TAP to do that validity challenge. Do you
560
00:34:27.719 --> 00:34:30.719
agree then that in that case you should not also
561
00:34:30.760 --> 00:34:34.039
maintain the ability to go to that jury that you
562
00:34:34.239 --> 00:34:38.119
just articulated is not reliable.
563
00:34:39.760 --> 00:34:41.559
You know that's not what the statute says, but it's
564
00:34:41.599 --> 00:34:45.119
a fair compromise. Frankly, I think if a review has
565
00:34:45.119 --> 00:34:47.360
been instituted, if the board is already found there's a
566
00:34:47.440 --> 00:34:50.599
reasonable likeli that the claims are invalid, then you should
567
00:34:50.639 --> 00:34:51.280
stay of the trial.
568
00:34:51.360 --> 00:34:54.400
There's an excellent chance at that point that some or
569
00:34:54.480 --> 00:34:54.880
all of the.
570
00:34:54.840 --> 00:34:58.199
Claims will be canceled once you've met that institution threshold
571
00:34:58.519 --> 00:35:02.840
and going through trial frankly a waste of everyone's money. Typically,
572
00:35:02.880 --> 00:35:05.800
when these dual litigations have to go forward that patent
573
00:35:05.800 --> 00:35:09.079
owners claim a complain about, it's not the defendant who
574
00:35:09.079 --> 00:35:11.880
wanted the litigation to go forward, it's the plaintiff who
575
00:35:11.920 --> 00:35:15.199
wanted the litigation to go forward. Typically, from what I've seen,
576
00:35:15.239 --> 00:35:17.519
if both the defendant and the plaintiff asked for a
577
00:35:17.599 --> 00:35:20.920
stay of the case pending the completion of the review, the.
578
00:35:20.920 --> 00:35:22.679
Judge will grant it.
579
00:35:23.320 --> 00:35:26.360
And look, I'm not saying this is you know, you
580
00:35:26.480 --> 00:35:29.480
do get cases where the technology is very accessible and
581
00:35:29.519 --> 00:35:31.719
where you know, an ordinary person can.
582
00:35:31.679 --> 00:35:33.880
Assess, you know what, have this been an obvious or not.
583
00:35:34.039 --> 00:35:37.039
But in some of these cases, it's just it's just
584
00:35:37.119 --> 00:35:40.320
invaluable to have that technical expert and at the.
585
00:35:40.400 --> 00:35:42.920
Very least you're not going to get a reliable result.
586
00:35:43.000 --> 00:35:46.480
And when these companies are facing repeated litigation again, like
587
00:35:46.519 --> 00:35:49.800
these numbers are in the papers, these are multi hundred million,
588
00:35:49.920 --> 00:35:52.039
even billion dollar awards.
589
00:35:52.119 --> 00:35:53.239
Do we want to take.
590
00:35:53.119 --> 00:35:56.239
That kind of money out of these companies' hides, you know,
591
00:35:56.559 --> 00:35:58.760
money that could be spent on building an Elorado plan
592
00:35:59.519 --> 00:36:02.119
or a chip fab. It seems like a no brainer
593
00:36:02.159 --> 00:36:05.480
to me that we want an accurate and reliable assessment
594
00:36:05.559 --> 00:36:08.559
of validity before we shift that kind of money around.
595
00:36:10.360 --> 00:36:14.079
Okay, I promise I will get to you, because I'm
596
00:36:14.079 --> 00:36:16.679
sure there's a lot you'd like to say about this conversation, Brian,
597
00:36:16.760 --> 00:36:22.639
I'd really like to bring you in and I, you know,
598
00:36:23.039 --> 00:36:26.480
in light at a time. But excuse me. I like
599
00:36:26.559 --> 00:36:28.880
to try to address each of the provisions of the
600
00:36:29.000 --> 00:36:33.960
MPR separately. So the first provision is the required Stipulation,
601
00:36:34.599 --> 00:36:37.159
and it says, quote, inter party reviews shall not be
602
00:36:37.239 --> 00:36:38.519
institute or maintain the lists.
603
00:36:38.519 --> 00:36:40.960
Each petition to file the stipulation with the.
604
00:36:40.880 --> 00:36:43.199
Board in any other tribunal where it is litigating or
605
00:36:43.280 --> 00:36:46.519
later litigates regarding the challenge patent, stating that if the
606
00:36:46.599 --> 00:36:49.719
trial is instituted, the petitioner at any real party in
607
00:36:49.760 --> 00:36:52.719
interest or privy of the petitioner, will not raise grounds
608
00:36:52.719 --> 00:36:56.039
of invalidity or unpattability with respects to the challenge patents
609
00:36:56.280 --> 00:36:58.199
on the one O two or one O three in
610
00:36:58.280 --> 00:37:02.400
any of the proceeding can you tell us whatever benefits
611
00:37:02.440 --> 00:37:04.079
or flaws you see in that provision.
612
00:37:05.679 --> 00:37:10.079
Well, I think the benefits are obvious in the sense that, Okay,
613
00:37:10.159 --> 00:37:13.880
we're going to actually choose a tribunal, and we're going
614
00:37:13.920 --> 00:37:19.239
to abide by the decision of that tribunal. So whichever
615
00:37:19.280 --> 00:37:23.159
way it goes and whichever party, whatever the parties decide,
616
00:37:23.760 --> 00:37:28.239
it makes sense rather than having two duplicative proceedings that,
617
00:37:28.320 --> 00:37:31.519
by the way, are decided according to different burdens of
618
00:37:31.599 --> 00:37:35.559
proof and different standards, so we can have competing decisions
619
00:37:35.599 --> 00:37:39.079
that come out of the Article three courts and decisions
620
00:37:39.079 --> 00:37:42.679
that come out of the PTO tribunal that are in
621
00:37:42.800 --> 00:37:46.400
conflict but are both correct, and that just doesn't make
622
00:37:46.440 --> 00:37:49.920
any sense from a jurisprudential efficiency standpoint.
623
00:37:51.800 --> 00:37:58.320
And I think to comment on Joe's remarks about.
624
00:37:58.039 --> 00:38:04.679
The professional and technological expertise within the Patent Office relative
625
00:38:04.719 --> 00:38:08.199
to that of a jury. You know, I'm a little
626
00:38:08.239 --> 00:38:11.480
bit skeptical of the notion that just because we have
627
00:38:11.559 --> 00:38:14.840
technical experts in the PTO that they're necessarily going to
628
00:38:14.840 --> 00:38:17.719
always come to the right conclusion. The fact of the
629
00:38:17.760 --> 00:38:19.960
matter is we have an issued patent that the PTO
630
00:38:20.079 --> 00:38:24.480
has determined is patentable, and then it goes back into
631
00:38:24.480 --> 00:38:28.559
the same agency before substantially the same technical experts who
632
00:38:28.599 --> 00:38:32.199
come to the opposite conclusion. That just doesn't seem to
633
00:38:32.239 --> 00:38:36.360
be efficient from the standpoint of investment and innovation in
634
00:38:36.400 --> 00:38:39.960
giving people the opportunity to move forward. So I'm also
635
00:38:40.079 --> 00:38:43.280
troubled by sort of the one way starry decisis that
636
00:38:43.440 --> 00:38:48.079
exists under the IPR system. The serial challenges that take
637
00:38:48.119 --> 00:38:51.400
place on substantially the same arguments means that the patent
638
00:38:51.519 --> 00:38:56.679
owner is perpetually in jeopardy and never really gets out
639
00:38:56.679 --> 00:39:02.239
from underneath sad whereas they would in court proceeding. But
640
00:39:02.559 --> 00:39:05.760
we don't have anything that stops the serial challenges that
641
00:39:05.800 --> 00:39:08.519
are in place right now. So I think, you know,
642
00:39:09.800 --> 00:39:12.559
somebody go out to get to choose the tribunal and
643
00:39:12.599 --> 00:39:17.679
then that really should be effectively the end point. But
644
00:39:17.719 --> 00:39:21.400
we don't have that, and so consequently we have duplicative litigation,
645
00:39:21.480 --> 00:39:25.800
We have duplicative IPRs, and it's just not efficient, and
646
00:39:25.840 --> 00:39:29.119
it's not fair and reasonable for the patent owners, and
647
00:39:29.159 --> 00:39:30.920
it certainly doesn't promote innovation.
648
00:39:31.760 --> 00:39:33.719
I'll tell you what, Brian, I'll trade you one and
649
00:39:33.760 --> 00:39:35.719
done on the IPR side for one and done on
650
00:39:35.800 --> 00:39:39.199
the on the litigation side, pan owners can only bring
651
00:39:39.239 --> 00:39:42.719
one case, preferably just against one defendant, and then they're
652
00:39:42.719 --> 00:39:45.199
done forever, and then they can't see anybody else, and
653
00:39:45.199 --> 00:39:47.599
then we can have one and done on the IPR side.
654
00:39:47.599 --> 00:39:50.679
I'd be happy to make that deal, but they are gave.
655
00:39:50.800 --> 00:39:52.840
I mean, if you bring a patent suit and the
656
00:39:52.920 --> 00:39:56.559
defendant proves that the patent's invalid, they're done. They've got
657
00:39:56.599 --> 00:39:59.519
they've shot their chance, and they're not going to get
658
00:39:59.519 --> 00:40:02.119
to come back. Can bring that up again if they win,
659
00:40:02.280 --> 00:40:04.679
that's a different story. And by the way, usually they're
660
00:40:04.800 --> 00:40:08.199
arguing about infringement at that point. Now, certainly the defendant
661
00:40:08.239 --> 00:40:11.920
at that point can again raise substantially the same arguments
662
00:40:11.920 --> 00:40:16.360
of invalidity, but presumably the judge will be at least
663
00:40:16.519 --> 00:40:19.760
moderately persuaded by the arguments that were raised in it
664
00:40:19.880 --> 00:40:20.840
earlier proceeding.
665
00:40:21.880 --> 00:40:25.800
So you know, I think that exists, Dave, I don't know.
666
00:40:26.000 --> 00:40:27.800
I'm not so sure, but I won't argue the point.
667
00:40:28.119 --> 00:40:30.199
I'd like to get back to kind of Andre's point
668
00:40:30.199 --> 00:40:32.440
about exaggeration, because I'm a big exaggerator.
669
00:40:32.519 --> 00:40:34.920
But it is no exaggeration to.
670
00:40:34.840 --> 00:40:37.280
Say it's not just that billions would be at risk
671
00:40:37.320 --> 00:40:40.679
in judgments. I mean, you look at the litigation record
672
00:40:40.920 --> 00:40:42.360
of the companies I represent.
673
00:40:42.599 --> 00:40:44.199
They do pretty well in litigation.
674
00:40:44.280 --> 00:40:47.480
They did pretty well in litigation prior to the AIA,
675
00:40:47.559 --> 00:40:50.280
but not always right. You do have a lot of
676
00:40:50.360 --> 00:40:53.199
uncertainty with choice. But it will be billions of dollars
677
00:40:53.519 --> 00:40:57.920
just in litigation costs that will be added here easily, billions.
678
00:40:57.960 --> 00:41:01.119
I mean, there was a study pre AIA that's that just.
679
00:41:01.239 --> 00:41:02.440
I think PAE.
680
00:41:02.159 --> 00:41:05.199
Suits resulted in something like a thirty two billion dollar
681
00:41:05.320 --> 00:41:08.719
loss to the US economy. And to Andre's point about
682
00:41:08.760 --> 00:41:11.760
again about exaggeration, it's not necessarily exaggeration.
683
00:41:12.119 --> 00:41:14.480
I don't know what's going to happen, but this look
684
00:41:14.599 --> 00:41:15.239
is going to look.
685
00:41:15.119 --> 00:41:18.519
A lot like PREAIA days, and that looked pretty ugly.
686
00:41:18.639 --> 00:41:23.320
And companies really do leave countries because of kind of
687
00:41:23.639 --> 00:41:28.079
litigation risk. When I was at Microsoft during the Motorola case,
688
00:41:28.079 --> 00:41:31.400
We've been telling the German government for years, you know,
689
00:41:31.519 --> 00:41:34.119
the kind of the liability under the penal laws is
690
00:41:34.119 --> 00:41:35.360
getting out of control.
691
00:41:35.679 --> 00:41:37.280
You going to start driving business away.
692
00:41:37.639 --> 00:41:40.480
During the motorol A litigation, Microsoft announced that it was
693
00:41:40.519 --> 00:41:44.400
moving it's it's European distribution center out of Germany, and
694
00:41:44.440 --> 00:41:46.159
we've got to call it there too later from the
695
00:41:46.159 --> 00:41:48.400
German government. That's a lot of jobs and a lot
696
00:41:48.440 --> 00:41:50.519
of tax revenue. What can we do? I said, well,
697
00:41:50.559 --> 00:41:53.320
you can listen to us like two years ago. Now
698
00:41:53.800 --> 00:41:56.960
the decisions made and we're leaving. So it really does
699
00:41:57.760 --> 00:41:59.519
I mean, you know, I can point to a number
700
00:41:59.519 --> 00:42:04.679
of experiences where people have made fairly large corporate decisions
701
00:42:04.679 --> 00:42:07.760
and sometimes to leave the entire jurisdiction just because of
702
00:42:07.800 --> 00:42:10.559
the liability, because you have other options, right, and.
703
00:42:10.639 --> 00:42:12.719
So if it's if the United.
704
00:42:12.440 --> 00:42:16.280
States is slightly better rather than a lot better as
705
00:42:16.320 --> 00:42:22.480
a site for your manufacturing plant, well extra onion two
706
00:42:22.519 --> 00:42:24.239
hundred and three hundred million dollars can.
707
00:42:24.280 --> 00:42:27.400
Tempt a balance, They really can't have an effect. I
708
00:42:27.400 --> 00:42:27.920
would say.
709
00:42:27.960 --> 00:42:30.440
One of the things that's more mobile than companies and
710
00:42:30.559 --> 00:42:32.119
moving in response to.
711
00:42:33.719 --> 00:42:36.239
Litigation or legal developments is investment.
712
00:42:36.599 --> 00:42:39.639
And if investors know that they're not going to get
713
00:42:39.679 --> 00:42:43.000
the return on their investment because of a weak patent system,
714
00:42:43.480 --> 00:42:46.639
they're going to invest in companies elsewhere. And we've already
715
00:42:46.679 --> 00:42:49.320
seen that happen, and so what we want to do
716
00:42:49.400 --> 00:42:52.079
is we want to invest in disruptive technologies here in
717
00:42:52.119 --> 00:42:55.119
the United States, and so we need to protect innovators
718
00:42:55.159 --> 00:42:56.800
and we need to protect patent holders.
719
00:42:57.199 --> 00:42:59.079
Well, Brent, that just doesn't make any sense to me.
720
00:42:59.119 --> 00:43:02.079
I mean, most sees that are investing in companies, they expect
721
00:43:02.079 --> 00:43:05.440
to operate in multiple countries, So you'd have you'd have
722
00:43:05.480 --> 00:43:08.960
to have the same defects in every country. That's making
723
00:43:08.960 --> 00:43:10.639
any sense, right, And then if you have the same
724
00:43:10.719 --> 00:43:13.920
defects in the patent systems of every country enough to
725
00:43:14.000 --> 00:43:16.840
like reduce insteadive, well there'd be no point to moving.
726
00:43:17.039 --> 00:43:19.719
And if you're in an international company, there is already
727
00:43:19.760 --> 00:43:22.639
no point to moving because under trips you can face
728
00:43:22.679 --> 00:43:25.360
the same you know, when you're located in China and
729
00:43:25.360 --> 00:43:27.119
you apply for a US patent, you're going to face
730
00:43:27.159 --> 00:43:30.679
the same defects. And you know, when you're a US company,
731
00:43:31.039 --> 00:43:33.679
you're almost always going to apply for a patent in China.
732
00:43:33.719 --> 00:43:35.559
So it just it doesn't make sense to me that
733
00:43:35.599 --> 00:43:39.079
anyone would there's no reason under trips for anyone ever
734
00:43:39.159 --> 00:43:42.400
to change their residents because of patent laws.
735
00:43:43.039 --> 00:43:46.880
Well, I mean that may be true for the large
736
00:43:46.960 --> 00:43:54.320
multinationals you represent, but it's not true of the startups,
737
00:43:54.440 --> 00:44:01.559
the original entrepreneurs and the like. And you know, a
738
00:44:01.599 --> 00:44:07.039
lot of American innovation happens in the startup economy obviously
739
00:44:07.079 --> 00:44:12.480
across the spectrum, and usually you look to your domestic
740
00:44:13.400 --> 00:44:14.440
market first.
741
00:44:14.920 --> 00:44:18.039
You know, if you're an American startup, your.
742
00:44:17.880 --> 00:44:22.599
First instance is I'm looking to develop and market my
743
00:44:22.679 --> 00:44:26.639
product here in the United States, and if I'm successful,
744
00:44:26.719 --> 00:44:29.760
then I'll go to Europe maybe, and then if i'm successful,
745
00:44:29.800 --> 00:44:31.960
I'll go to China and time and so on and
746
00:44:32.000 --> 00:44:36.480
so forth. But first and foremost, I need my domestic
747
00:44:36.559 --> 00:44:40.280
market and I need to protect that domestic market because
748
00:44:40.320 --> 00:44:42.679
if I don't have that by the time I get
749
00:44:42.679 --> 00:44:45.079
to Europe, I won't ever get to Europe, orate to China.
750
00:44:45.119 --> 00:44:47.719
It's going to be too late. My product will be killed.
751
00:44:47.719 --> 00:44:53.280
When a company will be killed in its infancy, obviously,
752
00:44:53.320 --> 00:44:57.079
when the companies are mature and they're multinationals, conglomerates and
753
00:44:57.159 --> 00:45:00.760
all of that, the calculus, all of this calculus is
754
00:45:01.800 --> 00:45:06.320
a little bit is a little bit different. I also
755
00:45:06.360 --> 00:45:09.039
want to go back to again, I'm just the whole
756
00:45:09.039 --> 00:45:14.840
conversation is, you know, the the unfortunate. I'm concerned that
757
00:45:14.920 --> 00:45:19.239
the whole conversation surrounding this is evolving into hyperbole, and
758
00:45:19.280 --> 00:45:23.599
it's going to prevent good policy to be made. And
759
00:45:23.679 --> 00:45:29.559
good policy always results from conversation, discussions, and compromise. You know,
760
00:45:29.880 --> 00:45:35.760
and I already heard through through the various statements apropost
761
00:45:35.800 --> 00:45:36.800
compromise from Joe.
762
00:45:37.320 --> 00:45:41.320
But if we're just sticking at the extremes on both sides,
763
00:45:41.440 --> 00:45:43.719
we're not going to be able to have the rational
764
00:45:43.760 --> 00:45:47.239
conversation where it needs to be in the middle. So,
765
00:45:47.840 --> 00:45:50.440
you know, statements like, for example, you.
766
00:45:50.360 --> 00:45:52.880
Know, you may have been kidding Dave, I don't know,
767
00:45:52.960 --> 00:45:56.199
but statements like you'll trade one and done in the
768
00:45:56.239 --> 00:45:59.039
IPR system with one and done for infringement.
769
00:45:58.960 --> 00:46:01.599
Just doesn't make sense. It doesn't make sense.
770
00:46:02.000 --> 00:46:06.719
It's not like it's one and done for invalidity.
771
00:46:06.840 --> 00:46:07.320
Period.
772
00:46:07.920 --> 00:46:12.000
Every defendant, no matter what, will have the ability to
773
00:46:12.079 --> 00:46:16.920
defend himself in court for sure, just like the plaintiff
774
00:46:16.960 --> 00:46:21.360
has an opportunity to present the plaintiff's case in court
775
00:46:21.599 --> 00:46:25.440
in every single case. This doesn't impact the court cases
776
00:46:25.599 --> 00:46:28.079
at all, so you still have the defense there, so
777
00:46:28.119 --> 00:46:32.199
you can just you know, because you're preventing one PTO mechanism,
778
00:46:32.280 --> 00:46:38.239
now you're preventing the entire court system on the other side,
779
00:46:39.159 --> 00:46:41.320
And by the way, you're not even preventing the entire
780
00:46:41.360 --> 00:46:42.480
PTO mechanisms.
781
00:46:42.760 --> 00:46:45.199
You still have the exparte in place.
782
00:46:45.239 --> 00:46:48.559
So my only point is, you know, it's fine to
783
00:46:48.639 --> 00:46:52.039
debate whether one and Done to the world is good
784
00:46:52.039 --> 00:46:55.119
policy or not. It's fine to have that debate, but
785
00:46:55.440 --> 00:46:58.679
I would just simply stay away from these extreme hyperboles
786
00:46:58.760 --> 00:47:02.519
that divert from a potential result that results in a
787
00:47:02.599 --> 00:47:09.519
balanced system. So, for example, and I asked Joe this,
788
00:47:09.639 --> 00:47:12.719
and I will ask you as well, are you okay
789
00:47:12.760 --> 00:47:15.239
with a system that is not one and done to
790
00:47:15.320 --> 00:47:19.599
the world, but it's one and done as to a
791
00:47:19.639 --> 00:47:24.559
particular defendant or short of that, one and done as
792
00:47:24.599 --> 00:47:26.000
to a particular proceeding.
793
00:47:26.320 --> 00:47:28.480
There's various gradual gradations here.
794
00:47:28.880 --> 00:47:31.880
So my only hope is that if people don't like
795
00:47:31.960 --> 00:47:36.480
the NPRM, and again I emphasize, you know, there's legitimate
796
00:47:36.599 --> 00:47:39.639
arguments on both sides of all of these points.
797
00:47:39.280 --> 00:47:40.039
In the NPRM.
798
00:47:40.480 --> 00:47:44.559
If you don't like them, make a counter proposal that
799
00:47:44.960 --> 00:47:49.039
reaches a result that we don't have. On the one hand,
800
00:47:49.159 --> 00:47:50.920
you don't like the one and done to the world,
801
00:47:50.920 --> 00:47:55.639
but on the other hand, we also shouldn't have, you know,
802
00:47:56.239 --> 00:48:01.039
endless repetitive challenges between the same parties on the same patent,
803
00:48:01.400 --> 00:48:04.679
with the same arguments. There's lots of place in the
804
00:48:04.679 --> 00:48:07.760
middle that people can have a rational debate and reach
805
00:48:08.000 --> 00:48:09.400
a rational conclusion.
806
00:48:11.400 --> 00:48:13.280
Here's a compromise for you. I don't think you could
807
00:48:13.400 --> 00:48:13.679
like it.
808
00:48:13.760 --> 00:48:16.400
But one way to address some of the issues that
809
00:48:16.519 --> 00:48:19.159
Jonah are raising would be to have something like a
810
00:48:19.159 --> 00:48:22.239
working requirement, so you don't you don't get the benefit
811
00:48:22.360 --> 00:48:25.440
of a discretionary denial unless you're actually practicing the patent
812
00:48:25.440 --> 00:48:28.679
in the United States that you know that protects investment
813
00:48:28.679 --> 00:48:31.440
in the United States. It actually gives you additional incentive
814
00:48:31.559 --> 00:48:33.800
because you know, you get that benefit if you're.
815
00:48:33.599 --> 00:48:36.679
Working the patent. It protects small entities.
816
00:48:36.760 --> 00:48:39.679
You know, you can structure however you want, you know,
817
00:48:40.119 --> 00:48:43.840
in terms of the entity making substantial efforts to practice.
818
00:48:43.920 --> 00:48:45.880
It doesn't need that they have to be a going concern.
819
00:48:46.320 --> 00:48:50.440
That would exclude foreign companies all in the US penents,
820
00:48:50.480 --> 00:48:52.760
but don't practice the United States from getting the benefit.
821
00:48:53.039 --> 00:48:56.719
I mean something that the benefit of a discretionary is now.
822
00:48:56.880 --> 00:48:59.440
So no discretionary denial unless you're working the patent in
823
00:48:59.440 --> 00:49:02.960
the United States. That takes care of a huge portion
824
00:49:03.079 --> 00:49:06.719
of the PAE problem that concerns tech. I don't see
825
00:49:06.760 --> 00:49:09.400
how it gores the aughts of you know, if it's
826
00:49:09.400 --> 00:49:14.800
written properly of people patentees who are actually intending or
827
00:49:14.880 --> 00:49:17.119
are already in business in the United States.
828
00:49:17.440 --> 00:49:19.800
But that would seem to satisfy ten of the concerns
829
00:49:19.800 --> 00:49:20.559
on both sides.
830
00:49:22.400 --> 00:49:24.280
Ran to address it.
831
00:49:24.800 --> 00:49:27.679
Yeah, I would say it's a rather superficial look at
832
00:49:27.719 --> 00:49:31.159
how the patent system is actually used in practice. Not
833
00:49:31.280 --> 00:49:33.960
everybody patents things that they're going to turn into a product.
834
00:49:34.000 --> 00:49:37.840
Sometimes they're patenting it to license it or monetize it
835
00:49:37.880 --> 00:49:42.559
in some other way. Sometimes they're using it to maintain
836
00:49:42.599 --> 00:49:47.039
a particular market in a particular technology that is something
837
00:49:47.079 --> 00:49:50.119
other than what they've patented. So there are lots of
838
00:49:50.159 --> 00:49:52.519
different ways that people use the patent system, and I
839
00:49:52.519 --> 00:49:57.960
think history has shown that we have long since refused
840
00:49:58.119 --> 00:50:01.599
to put in place a working requirement, and I think
841
00:50:01.599 --> 00:50:03.840
the wisdom of that is self evident.
842
00:50:05.840 --> 00:50:07.639
Well, let me get.
843
00:50:07.480 --> 00:50:13.760
Back to under his point about, you know, resisting hyperbole
844
00:50:13.880 --> 00:50:19.000
and trying to reach compromise, you know, through thoughtful processes.
845
00:50:19.320 --> 00:50:21.280
I mean, it's a given that you know, we all
846
00:50:21.320 --> 00:50:24.199
approach the US patent system with good faith and the
847
00:50:24.239 --> 00:50:26.840
best for the system and the best for the country.
848
00:50:27.639 --> 00:50:28.639
But here's the question.
849
00:50:29.239 --> 00:50:33.159
You know, if both sides of the issues regarding i
850
00:50:33.199 --> 00:50:35.960
PR's or patent law reform believe that you have had
851
00:50:36.000 --> 00:50:39.519
to achieve the US Article War Section eight, Clause eight,
852
00:50:39.719 --> 00:50:43.400
the constitution goal to promote progress of science and useful
853
00:50:43.480 --> 00:50:45.639
arts and maintain fidelity.
854
00:50:45.280 --> 00:50:49.320
With fidelity with it is correct? How is that reconcilable?
855
00:50:49.920 --> 00:50:52.519
Can both use be right or does it very based
856
00:50:52.519 --> 00:50:55.239
on what the progress of science and useful arts has become?
857
00:50:55.800 --> 00:50:57.360
Or is it merely one side is right and the
858
00:50:57.440 --> 00:51:01.000
other side is wrong? Joe, would you like to tackle that?
859
00:51:04.000 --> 00:51:07.639
I'll pass on the broader philosophical stuff. I mean, everyone
860
00:51:07.760 --> 00:51:09.480
is there are different views, you know, when you talk
861
00:51:09.519 --> 00:51:11.719
to people of different industries and they just have completely
862
00:51:12.320 --> 00:51:13.880
different views of these issues.
863
00:51:13.920 --> 00:51:17.960
And frankly, you know, the life sciences.
864
00:51:17.559 --> 00:51:20.639
Litigation is just so radically different, you know, from what
865
00:51:20.719 --> 00:51:23.000
goes on in the tech space. It's it's not even
866
00:51:23.039 --> 00:51:27.840
the same, uh, you know, patent system. I just you know,
867
00:51:27.840 --> 00:51:29.960
if we're going to talk about history, I came across
868
00:51:30.000 --> 00:51:34.920
something interesting recently when he was a Secretary of State,
869
00:51:34.960 --> 00:51:38.079
Thomas Jefferson got into a back and forth discussion with
870
00:51:38.119 --> 00:51:41.480
a congressman about legislation they were considering. In the congressman
871
00:51:41.519 --> 00:51:44.000
it proposed he shouldn't we have a rule that once
872
00:51:44.159 --> 00:51:47.360
patent validity has been decided once in a case, Uh,
873
00:51:47.480 --> 00:51:48.840
you know that that should be the end of it.
874
00:51:48.880 --> 00:51:52.360
And Jefferson replied, if you do that, people will immediately
875
00:51:52.400 --> 00:51:54.840
have a collusive suit brought against them just to cut
876
00:51:54.840 --> 00:51:58.719
off future challenges. So this is a this idea, the
877
00:51:58.719 --> 00:52:02.000
one and done philosophy, is one that Thomas Jefferson, one
878
00:52:02.000 --> 00:52:06.119
of the architects of the first patent acts, rejected. Certainly,
879
00:52:06.159 --> 00:52:08.639
the members of the Federalist Society should pay some heed
880
00:52:08.679 --> 00:52:11.559
when even Thomas Jefferson considered this and told you it's
881
00:52:11.559 --> 00:52:12.400
a terrible idea.
882
00:52:13.480 --> 00:52:23.599
Well, just for the record, Thomas Jefferson was not discussing
883
00:52:23.639 --> 00:52:27.199
the America Invents Act, or the i PR system, or.
884
00:52:27.159 --> 00:52:30.760
The existing multiple parallel challenges at the same time on
885
00:52:30.800 --> 00:52:32.519
the same patent between the same parties.
886
00:52:32.960 --> 00:52:35.800
Again, again, let's just be grounded here.
887
00:52:37.360 --> 00:52:40.840
Look, the reality is the patent system from the beginning
888
00:52:40.880 --> 00:52:42.199
of time is a compromise.
889
00:52:43.360 --> 00:52:45.920
It's always a compromise between.
890
00:52:47.239 --> 00:52:52.360
The rights of the innovator to protect the invention and
891
00:52:56.280 --> 00:52:59.360
his rights for a limited period of time versus the
892
00:52:59.440 --> 00:53:03.480
right of the black towards access towards that innovation. And
893
00:53:03.639 --> 00:53:07.960
everything comes down from that quick pro quo and compromise,
894
00:53:09.199 --> 00:53:13.519
and there's a potion pull. And our system for the
895
00:53:13.559 --> 00:53:17.119
last few decades has been harmed in my opinion, by
896
00:53:17.199 --> 00:53:20.880
extreme views or one side on the other. The patent system,
897
00:53:20.960 --> 00:53:24.760
in any system of property, depends on long term stability.
898
00:53:25.559 --> 00:53:28.400
Patents and other ip rights.
899
00:53:30.079 --> 00:53:37.320
Enable investment in long term, disruptive and risky technologies.
900
00:53:38.800 --> 00:53:40.320
People who make use of the.
901
00:53:40.280 --> 00:53:45.480
System and then invest heavily in the innovation economy have
902
00:53:45.679 --> 00:53:50.000
to have a long term view and the and these
903
00:53:50.559 --> 00:53:59.000
radical moves from one side to the other increasingly fast
904
00:53:59.119 --> 00:54:02.679
at an increasingly fast space is very disruptive to our
905
00:54:02.679 --> 00:54:05.719
innovation economy and long term is going to put the
906
00:54:05.880 --> 00:54:10.480
United States at at the competitive disadvantage vis a vis
907
00:54:10.639 --> 00:54:13.320
the rest of the world. This is why it's really
908
00:54:13.360 --> 00:54:20.519
important that we try to get the sides together and
909
00:54:20.639 --> 00:54:24.440
have a rational conversation to reach long term stability.
910
00:54:25.079 --> 00:54:27.679
And look, bottom line is, and.
911
00:54:27.639 --> 00:54:30.400
I've said this for a long time, I prefer a
912
00:54:30.480 --> 00:54:37.119
legislative solution in general to enable long term stability. And
913
00:54:38.119 --> 00:54:41.480
you know, we haven't talked in detail about prevail, but
914
00:54:42.320 --> 00:54:43.159
that could be.
915
00:54:43.079 --> 00:54:47.320
The conversation for a different such channel.
916
00:54:48.920 --> 00:54:51.719
The Office, in the meantime on until there is a
917
00:54:51.880 --> 00:54:56.440
legislative solution, has to operate the system that's been given
918
00:54:56.480 --> 00:55:00.519
to it. And you know this is the the NPRM
919
00:55:00.639 --> 00:55:04.039
is an attempt to operate the system in their view, through.
920
00:55:03.960 --> 00:55:06.000
Notice and comment and give the public input.
921
00:55:06.559 --> 00:55:09.159
And and if this is not the way it's going
922
00:55:09.239 --> 00:55:10.719
to go forward, it's going to be amended.
923
00:55:11.280 --> 00:55:12.880
Let's have the rational.
924
00:55:12.480 --> 00:55:15.480
Points be brought forward and and and and fix the
925
00:55:15.559 --> 00:55:16.440
mp r M as.
926
00:55:16.320 --> 00:55:18.800
People as the consensus comes out to be.
927
00:55:19.679 --> 00:55:22.000
Fortunately, Andrew, I think the Office has put itself in
928
00:55:22.039 --> 00:55:25.320
a position where that's probably not possible. I mean, they're
929
00:55:25.360 --> 00:55:29.880
not they're not following the regulations that were promulgated before.
930
00:55:30.719 --> 00:55:33.960
There's nothing in here that cuts off discretion. You know,
931
00:55:34.039 --> 00:55:36.800
based on the Federal Circuit decision says unlikely that you
932
00:55:36.800 --> 00:55:39.679
can get an end amos an APA suit and certainly
933
00:55:39.760 --> 00:55:42.159
can't get a direct appeal of any of these decisions.
934
00:55:42.559 --> 00:55:43.239
So I mean.
935
00:55:45.199 --> 00:55:46.920
I feared that you're going to have people on my
936
00:55:47.039 --> 00:55:50.400
side who look at the regulations and say, you know,
937
00:55:51.119 --> 00:55:53.159
why would I believe that they will actually be followed?
938
00:55:53.400 --> 00:55:55.679
What possible relevance do they have?
939
00:55:55.800 --> 00:55:57.599
Why should I spend a lot of time trying to
940
00:55:57.639 --> 00:55:59.880
negotiate something that I don't believe will be buying it.
941
00:56:00.920 --> 00:56:03.920
And I think, you know, I don't mean to task
942
00:56:03.960 --> 00:56:05.000
those persons on the office.
943
00:56:05.039 --> 00:56:09.480
I'm just saying the the sentiment on my side.
944
00:56:10.039 --> 00:56:10.920
You know where we do.
945
00:56:10.960 --> 00:56:13.320
You know me, Andrew, you know, we have sat down
946
00:56:13.360 --> 00:56:16.599
and had these conversations. Normally we'd be happy to but
947
00:56:16.679 --> 00:56:20.239
in this circumstance, I can't tell my member companies that, yes,
948
00:56:20.440 --> 00:56:22.599
the PTO is going to abide by these rgs.
949
00:56:22.679 --> 00:56:25.440
Whatever we negotiate, there will be no certainty at all.
950
00:56:25.519 --> 00:56:27.519
They're not, like I said, they're not abiding by the
951
00:56:27.599 --> 00:56:29.280
rigs that were promulgated previously.
952
00:56:30.000 --> 00:56:34.800
Well, getting back to Andrea's point about, uh, you know, legislation.
953
00:56:36.519 --> 00:56:41.199
So if if Congress, I mean, in order to achieve
954
00:56:41.280 --> 00:56:44.280
stability and you know, the finality issue that we're all
955
00:56:44.320 --> 00:56:48.719
talking about as well in terms of determinations, would it
956
00:56:48.800 --> 00:56:52.039
make more sense for Congress to really take take more
957
00:56:52.159 --> 00:56:54.760
by the hornes so to speak and deal with these
958
00:56:54.800 --> 00:56:59.360
issues directly, and I would suggest that we come up
959
00:56:59.400 --> 00:57:02.719
with I've come up with an acronym epstein, which would
960
00:57:02.679 --> 00:57:08.119
probably make it sales through quite quickly. But you know,
961
00:57:08.239 --> 00:57:10.480
I'll ask each of you to just briefly say whether
962
00:57:10.559 --> 00:57:14.599
you think that a congressional response to these issues and
963
00:57:14.639 --> 00:57:18.320
what's you know, the Prevail Act, for instance, is a
964
00:57:18.320 --> 00:57:21.960
better course of action to avoid whiplash from administration to
965
00:57:22.039 --> 00:57:26.000
administration at the agency. Ryan, i'llsu first.
966
00:57:27.199 --> 00:57:30.119
Yeah, thanks, Rob Well, I agree one hundred percent with
967
00:57:30.119 --> 00:57:31.039
what Andre said.
968
00:57:31.719 --> 00:57:33.800
You know, legislation is the only way to fix this.
969
00:57:34.800 --> 00:57:39.840
It's these are invariably long term investments. They're tricky, risky investments.
970
00:57:40.719 --> 00:57:45.480
Patent system, a reliable, predictable patent system is central to that.
971
00:57:45.920 --> 00:57:48.280
And to get back to your earlier question, you know,
972
00:57:48.480 --> 00:57:52.400
since the very beginning of this nation, we wrote into
973
00:57:52.440 --> 00:57:57.559
our constitution the provision for the Patent Act. Everybody wants innovation.
974
00:57:57.719 --> 00:57:59.719
Doesn't matter what side of the coin you're on, Everybody
975
00:57:59.760 --> 00:58:02.440
wants its innovation. But the fact of the matter is,
976
00:58:02.599 --> 00:58:07.559
we created with our constitution the first patent Act of
977
00:58:07.599 --> 00:58:11.440
its kind that had not existed anywhere else in the world,
978
00:58:11.480 --> 00:58:15.119
with certain limitations that the rights would go only to
979
00:58:15.159 --> 00:58:18.519
the inventor for limited at times and their exclusive rights only.
980
00:58:19.599 --> 00:58:23.559
And as a result, we have become the most innovative
981
00:58:23.639 --> 00:58:26.920
nation the world has ever seen. And that's because of
982
00:58:26.960 --> 00:58:30.360
our legal regime. It's not something in the water here
983
00:58:30.360 --> 00:58:33.679
in the United States. It's because we have a predictable,
984
00:58:33.760 --> 00:58:36.880
reliable legal regime that protects innovators.
985
00:58:37.360 --> 00:58:39.039
And so I.
986
00:58:38.760 --> 00:58:41.920
Agree with Andre that we have to find the middle ground.
987
00:58:42.880 --> 00:58:49.559
Legislation is a tool of compromise, but I do believe
988
00:58:49.639 --> 00:58:52.360
legislation is the only way to fix this, because otherwise
989
00:58:52.719 --> 00:58:56.000
we're going to be tacking port and starboard for many
990
00:58:56.079 --> 00:58:59.719
years to come, as each administration chambers and we get
991
00:59:00.119 --> 00:59:05.159
people coming in with different ideas, So legislation is absolutely imperative.
992
00:59:06.559 --> 00:59:13.320
Joe, your feelings on having Congress correct these issues?
993
00:59:14.679 --> 00:59:16.039
Sure? You know.
994
00:59:16.079 --> 00:59:18.760
One interesting thing is we have a dozen years experience
995
00:59:18.880 --> 00:59:21.840
under the America and Men's Act and p TAP proceedings,
996
00:59:21.880 --> 00:59:24.480
and one thing we know for certain to fight all
997
00:59:24.519 --> 00:59:27.079
the attacks on the proceeding from within and without the
998
00:59:27.119 --> 00:59:30.679
agency is the proceedings actually work quite well. They work
999
00:59:31.079 --> 00:59:33.800
more or less as intended. The board is producing high
1000
00:59:33.880 --> 00:59:38.480
quality decisions. Those decisions are upheld on appeal more often
1001
00:59:38.480 --> 00:59:42.079
than district court decisions are, even though they're more reviewable,
1002
00:59:42.079 --> 00:59:44.880
because they're actually explained to the extent people of a
1003
00:59:44.920 --> 00:59:48.440
detected bias in the board's decisions and the federal circuits reversals,
1004
00:59:48.679 --> 00:59:50.800
it's been a bias in favor of patent owners. The
1005
00:59:50.800 --> 00:59:53.559
Board is much more likely to be reversed for having
1006
00:59:53.679 --> 00:59:58.199
failed to find claims unpatentable than to be reversed for
1007
00:59:58.280 --> 01:00:02.280
finding them unpatent I'd say there's a good case to
1008
01:00:02.320 --> 01:00:04.400
be made that at this point more of these issues
1009
01:00:04.400 --> 01:00:06.840
should be shifted from the Board and out of course,
1010
01:00:06.880 --> 01:00:08.920
that a broader set of issues should be allowed to
1011
01:00:08.920 --> 01:00:11.920
be raised in inter parties reviews or later in the
1012
01:00:11.960 --> 01:00:14.239
life of the patent. PGR is great, but it can
1013
01:00:14.320 --> 01:00:16.199
only be brought in the first nine months, and you
1014
01:00:16.239 --> 01:00:21.119
can't challenge every patent in your art field. Most people
1015
01:00:21.119 --> 01:00:23.880
an't going to have that budget. The problem is, though
1016
01:00:24.239 --> 01:00:28.960
legislation takes years, and it was about a ten dozen
1017
01:00:29.039 --> 01:00:30.360
year process for the AIA.
1018
01:00:31.320 --> 01:00:33.519
Right now we're facing this rig that is.
1019
01:00:33.519 --> 01:00:37.119
Literally going to cut off the ability to challenge validity
1020
01:00:37.159 --> 01:00:40.639
on improperly issued patents in hundreds of cases. If the
1021
01:00:40.679 --> 01:00:43.000
administration goes through with this rig you're going to see
1022
01:00:43.000 --> 01:00:47.320
American manufacturers get ripped off on a massive scale. Again,
1023
01:00:47.400 --> 01:00:50.679
we know these proceedings are the only reliable and consistent
1024
01:00:52.159 --> 01:00:55.280
system for reviewing these things. Why on earth the administration
1025
01:00:55.360 --> 01:00:57.960
is doing this, I frankly have no idea. It completely
1026
01:00:58.079 --> 01:01:02.119
undercuts everything that the higher level officials have said about
1027
01:01:02.119 --> 01:01:05.960
the importance of strengthening and reinforcing manufacturing capacity in the
1028
01:01:06.039 --> 01:01:06.760
United States.
1029
01:01:08.840 --> 01:01:13.079
Okay, well, I see we're kind of run over time.
1030
01:01:13.239 --> 01:01:18.639
But to Andre's point, I think it would be very
1031
01:01:18.639 --> 01:01:22.679
beneficial if we could reconvene this group and talk about
1032
01:01:23.079 --> 01:01:30.119
prevail if everyone is in agreement to that. I don't
1033
01:01:30.199 --> 01:01:34.440
run the show, but I'll certainly I'll certainly make that suggestion,
1034
01:01:34.960 --> 01:01:37.719
and I think it can happen. I want to thank
1035
01:01:37.960 --> 01:01:41.719
each one of you for all of your thoughtful comments
1036
01:01:41.880 --> 01:01:47.599
and this discussion. Hopefully we've all learned a little something.
1037
01:01:48.519 --> 01:01:51.519
I believe, as Andering points out, the best way to
1038
01:01:51.559 --> 01:01:54.199
understand your own position is really to understand the position
1039
01:01:54.280 --> 01:01:56.960
of the person who disagrees with you, and then hopefully
1040
01:01:56.960 --> 01:02:01.679
you can reach that compromise. Any last one more thoughts
1041
01:02:01.719 --> 01:02:02.199
before we.
1042
01:02:02.239 --> 01:02:06.079
End legislation, yes, but not necessarily to fix the PITA.
1043
01:02:06.239 --> 01:02:08.000
I think we might need a new solution.
1044
01:02:10.519 --> 01:02:14.719
Anyone else Okay, I guess we're at it. Thank you again.
1045
01:02:15.159 --> 01:02:18.840
I've thoroughly appreciated this conversation.
1046
01:02:19.559 --> 01:02:22.639
Thanks all, good, Thank you.
1047
01:02:23.679 --> 01:02:25.320
I'm having the four list Society.
1048
01:02:25.400 --> 01:02:29.440
Thank you so much to Andre, Joseph, David, and Brian
1049
01:02:29.559 --> 01:02:32.559
for speaking with us today and for Rob for moderating.
1050
01:02:32.800 --> 01:02:35.360
We're so grateful for your time and expertise on this
1051
01:02:35.440 --> 01:02:38.559
important topic. Thank you to our audience.
1052
01:02:38.159 --> 01:02:38.960
For joining us.
1053
01:02:39.039 --> 01:02:43.199
We really appreciate your participation. You can stay up today
1054
01:02:43.239 --> 01:02:47.199
on other announcements and upcoming webnars on our website, best
1055
01:02:47.239 --> 01:02:51.639
soft dot org. We're all major social media platforms. Thank
1056
01:02:51.679 --> 01:02:54.000
you once more for tuning in, and we are adjourned.
1057
01:02:55.280 --> 01:02:57.880
Thank you for listening to this episode of fedst Forums,
1058
01:02:58.000 --> 01:03:01.599
a podcast of the Thorough Society's practice For more information
1059
01:03:01.639 --> 01:03:04.679
about the Federal Society, the practice groups, and to become
1060
01:03:04.719 --> 01:03:07.840
a Federal Society member, please visit our website at fedsoc
1061
01:03:07.960 --> 01:03:08.639
dot org