“While Judge Rader said the bill would not itself achieve true balance at the PTAB… the PREVAIL Act would benefit the many members of US Inventor facing a gauntlet of well-resourced petitioners challenging their critical patent rights.”
On August 2, inventor advocacy group US Inventor held a webinar on provisions of the Promoting and Respecting Economically Vital American Innovation Leadership (PREVAIL) Act that are intended to curb abuses impacting small business patent owners at the Patent Trial and Appeal Board (PTAB). While most panelists on the virtual call acknowledged that the PREVAIL Act wouldn’t solve every problem threatening the U.S. innovation ecosystem’s most vulnerable members, there was widespread agreement that the bill would have beneficial impacts if enacted.
The webinar was US Inventor’s second on the PREVAIL Act following a virtual call last week with law professor Adam Mossoff and C4IP General Counsel Jamie Simpson.
Estoppel and Burden of Proof Provisions Expected to Benefit Patent Owners
Randall Rader, Former Chief Judge of the Federal Circuit, in his opening comments highlighted a pair of provisions from the PREVAIL Act that he expected would have the most beneficial impacts for members of US Inventor. First, he pointed out that the PREVAIL Act would cause estoppel to apply prior to the PTAB’s final written decision, preventing challengers from litigating validity claims after they’re raised in a petition. Rader also said that language increasing the burden of proof on PTAB patentability determinations from a preponderance standard to a clear and convincing standard would further limit the ability of alleged infringers to obtain protracted stays of district court infringement litigation.
US Inventor President Randy Landreneau, who noted at the outset that the inventor advocacy organization had not yet taken an official stance on supporting the PREVAIL Act, said that the statutory language of the PREVAIL Act indicated that while estoppel would apply to grounds raised in PTAB petitions, such estoppel wouldn’t attach until a petition was instituted by the PTAB. Rader responded that there was a certain wisdom to waiting for the institution phase to attach estoppel, giving challengers the opportunity to withdraw weak petitions for inter partes review (IPR) proceedings.
A Better Balance for Patent Owners, but Structural Problems Remain
While the PREVAIL Act introduces several changes to validity proceedings at the PTAB, Judge Rader conceded that the bill doesn’t address the most significant structural issue posed by the alternative venue for validity determinations. By separating infringement proceedings from validity, which as a defense to infringement should be litigated in the infringement context, the America Invents Act (AIA) enabled competing standards on claim construction and other aspects of validity determinations. Rader added that one of the greatest criticisms of patent systems in European jurisdictions that decouple infringement and validity proceedings was that such separation allows parties to take inconsistent arguments on the breadth of a patent to argue invalidity, while arguing a much smaller scope of the claimed invention during the infringement trial.
At the conclusion of the webcast, most panelists observed that the PREVAIL Act represents some progress in balancing PTAB proceedings between petitioners and patent owners. While Rader said that the bill would not itself achieve true balance at the PTAB, as the structural issues in separating validity from infringement would require a true repeal of the PTAB, the PREVAIL Act would benefit the many members of US Inventor facing a gauntlet of well-resourced petitioners challenging their critical patent rights.
