On September 29, 2021, Senators Patrick Leahy and John Cornyn introduced the Restoring the America Invents Act in the Senate.  According to the Senators, the bill seeks to “address problems for small businesses and ordinary Americans caused by poor-quality patents.”  It “builds on and supports the structures that were created ten years ago in the Leahy-Smith [America Invents] Act,” bringing “more transparency into the PTO review process, prevent[ing] politicized meddling with PTO decisions, and ensur[ing] that these important PTO proceedings are widely available to the public.”

The bill outlines numerous provisions to address the Senators’ concerns, many of which would codify decisions made by the Patent Trial and Appeal Board (PTAB) and Supreme Court.  The provisions of the bill include:

 

• • Director Review: The PTAB director may, at his/her discretion or at the request of a party, review, modify, or set aside a final written decision of the PTAB.  Any review by the director must be issued in a separate and public written opinion with reasoning for the decision.
    • Timelines: Within 18 months of enactment, the director is to create rules for the timelines, bases, and responses for director- and party-initiated reviews.
    • This provision would codify the Supreme Court’s June 2021 opinion in U.S. v. Arthrex creating director review of PTAB decisions.
  • PTAB Proceedings by Government Entities: The bill would add the ability for government entities to initiate post-grant review (PGR) and inter partes review (IPR) proceedings.  This would overrule the June 2019 Supreme Court opinion in Return Mail, Inc. v. United States Postal Service finding that the federal government is not a “person” capable of petitioning the PTAB.
  • Addition of Statutory or Obviousness-Type Double Patenting to IPR Challenges: Where currently IPRs are limited to challenges under 35 U.S.C. § 102 and 103 and only on the basis of prior art patents or printed publications, the bill would expand the challenge types available to include statutory or obviousness-type double patenting.  It would also allow a petitioner to rely on admissions in the patent specification, drawings, or claims in addition to patents or printed publications.
  • Removal of Discretionary Denials: The bill would remove the ability for the Board to deny petitions based on discretion (other than discretion under 325(d)(4) based on the same or substantially the same prior art or arguments having previously been presented to the PTO).  This provision would end the ability for discretionary denial based on application of the NHK-Fintiv factors previously outlined in precedential PTAB decisions, which allowed the Board to deny petitions for reasons other than on the merits.
  • Complaints Dismissed without Prejudice Will Not Prevent an IPR: The bill would clear up confusion about whether the 1-year time bar on filing an IPR after being served with an infringement complaint should apply when a complaint is dismissed without prejudice, which was at issue in the Thryv Inc. v. Click-to-Call Technologies LP opinions at the PTAB and Federal Circuit.  The provision ensures that a complaint that is dismissed without prejudice does not start the clock for the time bar.
  • Encourages District Court Stays in Favor of PTAB Challenges: When determining whether to stay a district court proceeding, the bill would require the court to consider whether:
    • The IPR or PGR would simplify the issues and streamline the proceedings.
    • Discovery in the district court is complete.
    • A stay or denial would unduly prejudice the non-moving party or present a clear tactical advantage for the moving party.
    • A stay or denial will reduce the burden of litigation on the parties.
      The decision whether to stay the case will be subject to immediate appellate review.
  • Clarifies Petitioner Estoppel: The bill clarifies that estoppel applies to joined parties to the same extent as the first petitioner.
  • Creates Patent Owner Estoppel: Under the bill, no claims can be issued to a patent owner that are not patentably distinct from a claim that was found unpatentable or canceled in a PTO proceeding.
  • Stay, Transfer, Consolidation, or Termination of Multiple Proceedings: When there are multiple proceedings filed at the PTO on the same patent or a pending application claiming the benefit of a common filing date, the bill would require the director to determine the manner in which the proceedings will go forward, including the ability to stay, transfer, consolidate, or terminate proceedings, with a rebuttable presumption that proceedings of the same type should be consolidated if they are filed close in time.  Inter partes proceedings will not be terminated in favor of ex parte proceedings.
  • No Ex Parte Communications by PTAB Judges: Under the bill, PTAB judges on a panel for a pending proceeding should refrain from ex parte communications with other judges and supervisors who are not on the panel regarding that proceeding.
  • Claim Amendments Require Full Examination: The bill requires a patent owner to have amended claims fully examined, proving their patentability under sections 101, 102, 103, and 112 by a preponderance of the evidence.
  • Rehearing Decision Timeline: The bill sets a deadline of 120 days after a final written decision for decisions on reconsideration, rehearing, or review, extendable for 60 days for good cause.
  • Expanded Appellate Standing: This provision creates a presumption of injury in fact if an appealing party reasonably expects estoppel will be asserted against it based on the final written decision subject to the appeal, or suffers any other concrete injury that is fairly traceable to the final written decision.  If the party is found to lack appellate standing, estoppel will not apply.  This provision broadens appellate standing so that petitioners who have not been accused of infringing the patent at issue can still appeal a final written decision.