The Unintended Consequences of Post-Grant Review of Patents

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The 2011 Leahy-Smith America Invents Act (AIA) was heralded as a landmark patent reform that would improve patent quality, create jobs, and boost the economy. The law was broad in scope and made many important changes. The AIA was also remarkable for one change it did not make. Many recent high-profile patent controversies have centered on what types of inventions should be eligible for patent protection. Critics have argued that software, business methods, and isolated human genes should not receive any patent protection at all. Despite these and similar controversies, the AIA left the scope of patent coverage almost entirely untouched. The language of section 101 of the Patent Act, which defines the types of inventions that are eligible for patent protection, was entirely unchanged.
While the AIA did not directly change the scope of section 101, it did introduce a new, long-anticipated procedure to challenge a patent that has already been issued. The new post-grant review procedure allows petitioners to challenge a patent’s validity on many different grounds, including failure to satisfy existing section 101 requirements. Moreover, section 324(b) allows the Director of the PTO (Director) to authorize post-grant review if a petition raises “a novel or unsettled legal question that is important to other patents or patent applications.” The legislative history does not clarify how Congress imagined the Director would use this power.
Section 324(b) has not attracted mainstream media coverage, but patent specialists and attorneys have begun to speculate about its implications. I argue that petitioners will bring controversial subject matter challenges under section 324(b) because the law surrounding Section 101 remains unsettled. If these petitioners succeed, post-grant review may have the unintended consequence of indirectly redefining the scope of patent eligible subject matter.
Subject matter challenges are currently made in federal court. Post-grant review differs from litigation in two important ways. First, post-grant review allows third parties to challenge a patent without satisfying federal standing requirements. Second, post-grant review involves the PTO in challenges to patentable subject matter that have historically been left to federal judges. I argue that these differences may have two important impacts: (1) more subject matter challenges will be brought by interest groups for ideological, political, or policy reasons, and (2) the system will ultimately be more responsive to shifting popular preferences about what types of inventions should receive patent protection.
This Comment proceeds as follows. Part I explains that § 324(b) allows petitioners to raised novel and unsettled legal questions during post-grant review. Part II argues that the persistent uncertainties surrounding section 101 will allow petitioners to argue that patents do not cover patent eligible subject matter. Part III argues that the lack of traditional standing requirements for post-grant review will mean that more special interest groups will be able to bring subject matter challenges for ideological, political, or policy reasons. Part IV considers the relative institutional competencies of the federal courts and the PTO and argues that the post-grant review system may have the unintended consequence of making patent law more responsive to shifting popular preferences about what types of inventions merit patent protection. Part V proposes regulations and practices for the PTO and Federal Circuit intended to maximize the potential benefits of post-grant review and § 324(b).

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