Inter Partes Review – Overview and Affordable Defense

Born from the America Invents Act, the Inter Partes Review (“IPR”) Proceeding, and its progeny, the Covered Business Method (“CBM”) Proceeding, and Post Grant Review (“PGR”) have become the favored means for defendants in patent cases to short circuit a Plaintiff’s path to trial.  IPRs have been especially successful, resulting in victories for Defendants approximately 90% of the time.  As most Plaintiff litigation firms will not handle an IPR as part of their contingent fee agreement with the Plaintiff in the underlying patent litigation case, this also adds enormously to a Plaintiff’s cost; typically, defending an IPR costs a Plaintiff between $250,000 and $1,000,000.  However, the Law Offices of Konrad Sherinian, LLC is pleased to offer an affordable IPR defense plan with minimal up front costs to qualifying Plaintiffs.  

An Overview of the Inter Partes Review Process

First, only a person who is not the owner of a patent may file a petition with the United States Patent & Trademark Office to institute an Inter Partes Review of an issued patent.  An IPR can only be raised based on printed publications and only on grounds that fall under 35 U.S.C. §§ 102 and 103.  Each IPR is conducted before the Patent Trials and Appeals Board (“PTAB”), which reviews the petition, as well as any response from the patent owner, and determines whether or not to institute the IPR.  

An IPR can only be filed if 1) at least nine months have elapsed since the challenged patent was granted, or 2) if a PGR was filed, the day the PGR terminates.  In addition, an Inter Partes Review may not be instituted if the petition requesting the IPR is filed more than one year after the petitioner, real party-in-interest, or the privy of such, is served with a complaint alleging infringement of the patent.

In order for an Inter Partes Review, it must meet the following criteria:

  1. The proper fee must accompany the IPR;
  2. The IPR must identify all real parties in interest;
  3. The IPR must identify in particularity each claim that is challenged, the grounds on which each claim is challenged, and the evidence that supports those grounds.  In particular, the IPR must include:
    1. Copies of any patents or printed publications that the petitioner relies on to support the IPR;
    2. Any affidavits, declarations and supporting evidence of any opinions that are offered in the affidavits and declarations if the petition relies on an expert opinion; and
    3. Proof that the IPR and all of the above was properly served on the patent owner.

All Petitions for Inter Partes Review are made public as soon as practicable.  

The patent owner has the right to file a Response, known as the Preliminary Response, to the initial IPR petition.  The Preliminary Response must be filed no later than three months after the initial notice from the PTAB indicating that the IPR has been granted a filing date.  The notice will specify a notice date (mailing date) on the front; the Preliminary Response must be filed no later than three months from that date.  The notice will look much like the following:

Inter Partes Review

A patent owner does not have to file a preliminary response.  However, in most cases, it is advantageous for the patent owner to oppose institution of the IPR.  If the patent owner chooses not to file a Preliminary Response, the decision on whether or not to institute the IPR can be expedited if the patent owner files an election expressly waiving the Preliminary Response.  

In the Preliminary Response, the patent owner may not introduce any testimonial evidence unless it is authorized by the PTAB (which rarely happens), although the patent owner can argue based on testimonial evidence introduced by the petitioner.

Once the Preliminary Response has been filed, expressly waived, or the time to file such response has expired, a panel of Administrative Patent Judges will consider the petition.  Within three months of starting such consideration, the panel will determine whether or not to institute Inter Partes Review.  An IPR will be instituted if the panel determines that there is a reasonable likelihood that the petitioner will prevail in invalidating at least one of the claims challenged in the petition.  

Typically, IPRs are filed after a defendant has been sued in civil litigation.  As such, most of the time, after an IPR has been instituted, the patent litigation is stayed in court pending resolution of the IPR.  In addition, given the high rate of success of IPRs in invalidating patents, this is usually the end of the line for a patent lawsuit.

On the latter point, one issue that patent owners face when defending an IPR is the standard of proof; rather than the clear and convincing standard that an alleged infringer must overcome in civil litigation, the petitioner only has to prove that a claim is more likely invalid than not.  

During an IPR, a patent owner can only amend claims a single time.  In addition, the patent owner must establish that the amendment addresses an issue raised by the petition and does not seek to enlarge the scope of a claim or introduce a new matter.  An additional motion to amend claims will only be permitted on joint request of the petitioner and the patent owner to materially advance the settlement of a proceeding.

In many cases, IPRs are resolved via settlement.  However, the vast majority of such settlements are royalty free licenses for the petitioner, which is unquestionably a critical loss for the patent owner.

Finally, after the IPR proceeding is complete, the PTAB will issue a decision either upholding or cancelling the challenged claims.  A party that is not satisfied with the decision of the PTAB may appeal the decision.

Affordable Defense of Inter Partes Review Proceedings

Presently, more than 90% of IPRs result in victory for the petitioner.  It is difficult to believe that more than 90% of patents challenged by IPR (most if not all patents asserted in litigation) are invalid in view of the prior art.  Rather, it is more likely that many IPRs are not being defended effectively (or at all).  Given that the typical cost to defend an IPR is between $250,000 and $1,000,000, it is likely that many patent owners simply run out of funds – especially if the attorneys that they select to represent them in their patent litigation cases are not able to represent them in the IPR.  

To meet this need, the Law Offices of Konrad Sherinian, LLC is now offering an affordable IPR defense plan.  Presently, we are charging a single up front fee – typically between $40,000 and $75,000 – along with payment of all expenses and a negotiated contingent fee that is a portion of all future licenses related to the challenged patent or any related patents.  Our firm has an excellent record before the PTAB, and our attorneys are experienced in a variety of technology areas.

If your patent has been challenged via IPR and you need representation, contact us today, and we will evaluate your case to determine if we can represent you.   Please feel free to reach out to us via telephone or email. You may also fill out our online inquiry form and we will strive to get back to you within 24 hours.