The Reexamination Power of Patent Infringers and the Forgotten Inventor

• Author: Douglas Duff
• Position: Registered Patent Agent. J.D., 2013, Capital University Law School; B.S. Mechanical Engineering, 2005, Wright State University
• Pages: 693-727

THE REEXAMINATION POWER OF PATENT INFRINGERS

AND THE FORGOTTEN INVENTOR

DOUGLAS DUFF*

I. INTRODUCTION

Now threatened, an inventor’s rights were once secured. Protection of

the inventor dates back to our founding fathers drafting directly into the

United States Constitution the availability of patents “[t]o promote the

Progress of Science and useful Arts, by securing for limited Times to

Authors and Inventors the exclusive Right to their respective Writings and

Discoveries.”1 The American patent system, established by the U.S.

Constitution, relies upon providing incentive for three types of activities.2

The patent system must provide incentive for the inventor to invent, to

disclose, and to risk capital.3 Furthermore, the incentive offered by the

government in its patent bargain with the inventor must come with

minimal interference to foster the motivation of an inventor to invent, to

Copyright © 2013, Douglas J. Duff.

* Registered Patent Agent. J.D., 2013, Capital University Law School; B.S. Mechanical

Engineering, 2005, Wright State University. The autho r is a former patent examiner at the

United States Patent and Trademark Office and a former design engineer employed in the

fluid machinery industry. The author would like to thank Professor Stephen Grant and Paul

Roderer for their feedback and the author’s wife, Angela, for her steadfast support.

1 U.S. CONST. art. I, § 8, cl. 8. William Thornton, a superintendent of patents during the

Nineteenth Century, “viewed the patent system as an institution designed to serve and

reward inventors.” Andrew P. Morriss & Craig Allen Nard, Institutional Choice & Interest

Groups in the Development of American Patent Law: 1790–1865, 19 SUP. CT. ECON. REV.

143, 156 (2011).

2 John B. Campbell, Jr., What’s the Deal Now? A Business Perspective Analysis of the

U.S. Patent System and Recent Changes to the Patent Laws, 10 TEX. INTELL. PROP. L.J. 293,

297 (2002).

3 Id. See also Thomas L. Irving et al., The Significant Federal Circuit Cases

Interpreting Section 112, 41 AM. U. L. REV. 621, 622–23 (1992) (“The modern U.S. patent

system has three purposes: first, to encourage invention by offering potential rewards to the

individual inventor; second, to encourage industry to assume the risks of financing research,

developing products, and introduci ng new products to the marketplace; and t hird, to

discourage an atmosphere in which industrial design and technological development are

clouded in secrecy, and scientific progress is hidden from the public.”).

694 CAPITAL UNIVERSITY LAW REVIEW [41:693

disclose, and to invest.4 Only when this delicate contractual balance is

struck will the patent system serve to advance technological progress.5

Patent reexamination has become such a colossal and powerful

administrative instrument that it threatens to disrupt this delicate balance

and destroy patent rights previously granted through the patent bargain.6 A

multitude of reexamination benefits for third parties reveals a dominant

method to supplement or replace litigation when a reexamination petitioner

seeks to terminate the patent rights of an inventor. These third party

reexamination requesters are typically accused infringers, but may include

anonymous competitors.7 Infringer-friendly reexamination characteristics

4 Chief Justice Marshall articulated the contract metaphor of patent law in Grant v.

Raymond, 31 U.S. 218, 242 (1832). The recognition of a quid pro quo contract between the

United States and the inventor continues today. J.E.M. Ag Supply, Inc., v. Pioneer Hi-Bred

Int’l, Inc., 534 U.S. 124, 142 (2001) (“The disclosure required by the Patent Act is ‘the quid

pro quo of the right to exclude.’”). See also John C. Hughs, The Disruption of the U.S.

Constitutional Symmetry of Intellectual Property to Gain Conformity with an International

Property Framework; A Road to a Global Market or a Tripping Point to the Gradual

Collapse of the U.S. Economy?, B.C. INTELL. PROP. & TECH. F., June 8, 2004, at 1,

http://bciptf.org/wp-content/uploads/2011/07/34-Hughs-THE-DISRUPTION-OF-THE-US-

CONSTITUTION.pdf. Due to the ex parte nature of ad ministrative patent proceedings, the

government represents the people of the United States as th eir agent. Eric D. Zard,

Comment, Patentability of Human Genetic Information: Exploring Ethical Dilemmas

Within the Patent Office and Biotechnology’s Clash with the Public Good, 6 UNIV. OF ST.

THOMAS L.J. 486, 491 (2009). While the USPTO serves the inventor, the American people

are the parties affected by the granting of patent righ ts. Id.

5 Hughs, supra note 4, at 1–2.

6 The term “inventor,” as used throughout this Article, refers to every type of inventing

entity. However, the increasing power of reexamination especially harms individual

inventors. Christopher A. Cotropia, The Individual Inventor Motif in the Age of the Patent

Troll, 12 YALE J. L. & TECH. 52, 57 (2010). See also Mark D. Janis, Rethinking

Reexamination: Toward a Viable Administrat ive Revocation System for U.S. Patent Law, 11

HARV. J.L. & TECH. 1, 37 (1997) (quoting a USPTO commissioner who “testified that the

time and expense associated with judi cial resolution of the patent validity issue p laced

‘special hardships on small businesses and individual inventors.’”).

7 Stefan Blum, Note, Ex Parte Reexamination: A Wolf in Sheep’s Clothing, 73 OHIO ST.

L.J. 395, 412 (2012). “Infringers” or “accused infringers,” as referenced throu ghout this

Article, may include parties accused o f infringing a patent, active infringers th at have not

been discovered, or anonymous third parties such as competitors of the inventor wishing to

infringe. The term “infringer” is u sed frequently in the present analysis t o emphasize that

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2013] POWER OF REEXAMINATION 695

and rules, recent case law that makes the validity of previously granted

patents now questionable, and new patent legislation that expands the

scope of reexamination at the United States Patent and Trademark Office

(USPTO) give accused infringers greater power now than ever before.

This unprecedented power erodes the incentives that form the basis of the

patent system and disrupts the delicate and longstanding balance between

inventors and the government. The continued use and expansion of

reexamination will discourage the patenting efforts of inventors as the core

purpose of patent law—the incentive for inventors to invent, to disclose,

and to invest—is stifled, and the patent rights of inventors are

compromis ed.

II. BACKGROUND OF PATENT ACQUISITION AND

PATENT REEXAMINATION

A. Acquisition of Patent Rights

The relationship between a patent applicant and the USPTO is a

delicate contractual relationship.8 The government offers a patent

applicant an exclusive right to make, use, sell, or import9 an invention if

the inventor discloses certain information, performs certain tasks, and pays

certain fees.10 After spending the energy, time, and resources to create a

new and useful invention, an inventor must decide whether to expend

additional energy, time, and resources to protect that invention at the

USPTO.

As part of the price to obtain patent rights, an inventor must do more

than simply pay a large amount of money.11 The inventor must discl ose

the invention to the public in a formal patent application and pay filing,

an infringer benefits most from reexamination while being the least deserving of

empowerment at the United States Patent and Trademark Office.

8 Brenner v. Manson, 383 U.S. 519, 534 (1966) (“The basic quid pro quo . . . for

granting a patent monopoly is the benefit derived by the public from an invention with

substantial utility.”). See also Eldred v. Ashcroft, 537 U.S. 186, 216 (2003) (“[I]mmediate

disclosure is not the objective of, but is exacted from, the patentee. It is the price paid for

the exclusivity secured.”).

9 35 U.S.C.A. § 271(a) (West 2012).

10 35 U.S.C.A. § 111(a)(1)–(3) (West Supp. 2012).

11 The financial cost of obtaining a patent can be as much as $30,000. Damon C.

Andrews, Why Patentees Litigate, 12 COLUM. SCI. & TECH. L. REV. 219, 223 (2011).