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Supreme Court saves bad patent review

| Jun 15, 2020 | Uncategorized |

The U.S. Patent Office must sometimes address when it granted a patent that failed the tests of patentability, known as a bad patent. The US Supreme Court issued an important intellectual property  decision last April when it approved the PTO’s process used to review and eliminate bad patents.

A new process for challenging the validity of bad patent claims, the PTO’s inter parties review, was created in the 2011 America Invents Act. The Patent Trial and Appeal Board may begin hearings on the validity of the challenged patent claims if the PTO finds that a challenge petition warrants action and meets other standards, such as timely filing before a deadline.

In this case, the Court addressed whether a federal court could overturn the PTO’s conclusion that a deadline for challenging a deadline was met. In a 7 to 2 decision, it ruled that overturning the PTO’s decision would interfere with agency proceedings determining patentability and continue enforcement of bad patents. The Court concluded that Congress created this process to efficiently eliminate bad patents to fix over patenting and reduced competition.

Recently, some lawmakers questioned whether there were bad patents and wanted to take away the IPR’s power to address this issue. But this process helps prevent some of the misuse of bad patent litigation.

Bad patents may be used to threaten or file questionable litigation which can harm smaller manufacturers which have thin capitalization. Start up costs for new products include research and development, constructing or expanding facilities, hiring more workers, and establishing distribution systems.

Facing a bad patent lawsuit, these firms face the choice of paying a quick settlement in a case relying on a bad patent or paying time and costs in prolonged litigation. Settlement allows bad patents to remain in force and threaten other firms. Litigation may lead to a patent suit that, on average, takes five years and costs $3 million and could put a firm out of business.

An attorney can help assure that your ideas are protected with proper intellectual property filings and that legal requirements are met. An intellectual property attorney can also help you preserve your rights against misappropriation.

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