IP law changes likely to spike patent validity requests

Changes starting this year in U.S. intellectual property laws may cause more California companies to request federal government help in resolving patent lawsuits instead of a long litigation battle. Some companies already ask the U.S. Patent and Trademark Office to check the validity of patents during reexaminations to avoid taking cases to court.

Companies have seen positive evidence over the last five years that government patent reviews work. Twice the number of requests for government intervention have been made in the last half decade by companies like Google and TiVo.

The federal patent office is preparing for an onslaught of re-examinations, especially requests that allow third parties to take part. A government re-exam evaluates whether a patent was issued correctly. Companies have found that the patent office will “knock out” a patent faster than a court.

The patent office says that 90 percent of government patent re-examinations lead to a change or cancellation. Companies accused of patent infringement could avoid costly damages if patent owners are required to modify a patent. Starting in September, the window will begin to open to include all patents. More third-party participation will also be allowed.

New rules will also limit how long the government can take to make up its mind. Proceedings are limited to one year, with possible six-month extensions.

The patent office is already planning to hire 100 extra administrative law judges to handle the expected volume of re-examination requests. The government also wants to hike the fees for third-party requests to more than $27,000. Re-exams that do not allow a third party would cost about $17,700 per request.

Source: Washington Post, “Patent fights increasingly end up back in government offices,” Susan Decker, Feb. 20, 2012