PTAB Estoppel as a Sword and Shield?
Estopping a Winning Argument?
One of the stranger developments of recent months has been the interpretation of PTAB estoppel (315(e)(2)) to foreclose a petitioner from pursuing arguments in a district court that were successful at the PTAB. That is, a petitioner that has successfully defeated claims at the PTAB, and has received a Final Written Decision (FWD) explaining the same, is thereafter estopped from making the same successful arguments in court.
Earlier this month, the government supported this position in an amicus brief to the Federal Circuit in BTG v. Amneal. In it’s brief, the government explains that its interpretation leads to the “counterintuitive result that the district court would not be able to consider invalidity arguments that the Board found persuasive.”
Aside from interpreting the statute to be “counterintuitive” in the first instance, which is canon of sorts in statutory construction, it also requires one to construe estoppel as somehow guarding against consistency.
To arrive at its counterintuitive result, the government relies (here) heavily on the fact that the previous inter partes reexamination statutes were explicit as to outcome where the corresponding AIA statute is not. That is, the previous inter partes reexam statute recited:
" A third party requester whose request for an inter partes reexamination results in an order under section 313 [35 U.S.C. § 313] is estopped from asserting at a later time, in any civil action arising in whole or in part under section 1338 of title 28, the invalidity of any claim finally determined to be valid and patentable on any ground which the third party requester raised or could have raised during the inter partes reexamination proceedings. (emphasis in original)
(emphasis in original)
But in order for this argument to hold weight, it would have had to have been possible absent this language to argue the other side of the equation – it wasn’t. This statute was never “outcome determinative” as alleged.
The only estoppel that could be argued in court after an inter partes reexam was when the challenger failed (i.e., finally determined to be valid and patentable) . This is because estoppel didn’t attach until all appeals were exhausted. And if the challenger won at that point, the USPTO issued a certificate cancelling the claims. There was never an instance, even absent the above highlighted language, where a winning argument could be argued as subject to statutory estoppel because the patent was already dead. (assuming one could twist the word estoppel to cover such a result, which is another issue altogether)
Thus, to the extent we can guess at an unspoken reason as to why the highlighted language (valid and patentable) was removed in the AIA statute, it was because it was always superfluous in its previous iteration, and subsumed within the definition of estoppel anyway.
As to the four aspects aspects of the AIA statutes that were changed and explained in the legislative history relative to the inter partes reexam statutes, we have:
1. Estoppel was softened to reasonably could have raised; (to account for a diligent search)
2. Estoppel was extended to the ITC (oversight in reexam statutes)
3. Estoppel no longer flows from the courts to the agency (the former inter partes reexam systems set up a race between parallel proceedings as to which would control. The AIA was designed to be a litigation alternative); and
4. Estoppel attaches at the end of the AIA trial instead of at the exhaustion of all final appeals. (So that the outcome could be leveraged faster. Speed was a focus of the AIA framework given the 6-7 year reexamination timelines.)
It is this last change that has caused the current confusion. Estoppel now attaches before all appeals are exhausted. This change was nowhere described in the legislative history as also designed to turn the legal meaning of estoppel on its head, and to prevent consistency between proceedings.
Scott A. McKeown is an author of the Patents Post Grant