Congress passed the AIA because of serious concerns that low-quality patents were dragging down innovation and eroding public confidence in the patent system. They understood that the realities of the patent examination process lead to a high number of invalid patents issued, which NPEs seize on to extract value from small and Main Street businesses.
19 hours – Average number of hours PTO examiners have to look for prior art, understand the claimed invention, make a detailed comparison to decide what, if anything, should be patentable, and engage in a back-and-forth with the applicant.
Inter Partes Review Has Become a Vital Tool
Because IPR is faster and cheaper than litigation, the impact it has had on the ability of small businesses and Main Street companies to fight frivolous claims of patent infringement, and not give in to the aggressive demands of non-practicing entities, has been significant. For example:
- Dozens of small, independent podcasters were sued by a patent troll that claimed to have invented the concept of podcasting. Under the IPR, the patent was invalidated, allowing the podcasters to stay on the air and avoid devastating settlement payments.
- One patent troll claimed to own the idea of scanning a document to email. It sent letters to more than 16,000 small businesses nationwide, demanding a patent licensing fee of thousands of dollars each. The shakedown scheme was halted when the IPR process invalidated the patent.
98.8% of active patents never face an IPR.
Patents are invalidated less often in IPR than in court.
But Some Lawmakers and Regulators Want to Weaken IPR
The PTO has received unfounded complaints of unfairness about IPR in recent years, and the agency has significantly weakened the program in response by making it harder to invalidate patents that should not have been granted. At the same time, some lawmakers have introduced legislation to weaken the IPR process even further. These changes force small and Main Street businesses to choose between costly litigation and settling with NPEs.
38% – Percent increase in the frequency of patent litigation brought by patent trolls in recent months, as IPR gets weaker.