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Executive Interviews

The Reexamination Center Executive Interview: Chief Judge Paul R. Michel (part 1 of 3)

August 30th, 2011

With patent reform legislation looming on the not too distant horizon, The Reexamination Center interviews former Chief Judge of the United States Court of Appeals for the Federal Circuit Paul R. Michel on this topic and other timely issues related to patent reexamination.  Chief Judge Michel was appointed to the Court in 1988 and assumed the duties of Chief Judge in 2004.  Judge Michel judged several thousand appeals and wrote over 800 opinions in the diverse legal areas covered by his circuit (patent, government contracts, international trade, veterans’ benefits, government takings of private property, tax, childhood vaccine injuries, military and civilian promotions, trademark, civilian government personnel, and whistleblower cases).  On May 31, 2010, he stepped down from the bench.  Chief Judge Michel continues to share his knowledge gained during 22 years on the court by speaking out on issues related to the courts and the patent system, as well as by providing mediation, arbitration, and case evaluation services to private clients.

Chief Judge MichelTHE REEXAMINATION CENTER:  Why don’t you talk a little bit about coming off the Court, your reaction to being off the Court, what you’re doing and what you’re focusing on and why.

JUDGE MICHEL:  Well, I resigned at the end of May of 2010 as I was nearing the term limit of my time as the Chief Judge, motivated principally by the desire to be free to speak out on issues affecting intellectual property rights beyond the walls of the court house.  Sitting judges are restricted to commenting on policy matters within the narrow confines of how a policy change would impact the courts, and I wanted to be free to talk about whether the policies were wise and productive and would help innovation occur and create jobs or destroy jobs.  I decided  during the latter part of my 22 years on the Court to take that pathway even though my original intention was to stay forever – eventually maybe as a Senior Judge.  So right from the start, June 1 of last year, I busied myself with a heavy  schedule speaking around the country to patent lawyers and other intellectual property experts of one kind of another.  And I’ve written a number of articles – half a dozen or so.  I’ve been spending much of my time on things related to patent policy, patent reform, the pending legislation in Congress and I’ve found it enormously invigorating and exciting , slightly frightening and very satisfying.  I have no regrets at all about leaving the Court.  I loved being a Judge. I had always wanted to be a Judge and when I had the good luck of serving in that capacity, I enjoyed it hugely and for most of the 22 years I served on the Court expected I would never leave.  But having left and now looking back from the vantage point of more than a year, I am quite sure I did the right thing at the right time for the right reasons and it’s working out very, very well.

THE REEXAMINATION CENTER:  What is your overall impression, now that you’re off the Court, as to the effectiveness of the patent system for innovators in the United States?

JUDGE MICHEL:  I think that the patent system is critical to many companies and many industries – but not all – and that the patent system is performing on the whole rather well.  But there are areas where important improvements can and should be made.  I think a lot of improvements that were needed actually have been made in the last five years or so – primarily by the Courts, particularly the Federal Circuit and the Supreme Court.Meanwhile, particularly in the last two years, considerable reforms have been instituted within the Patent Office, most of which look very productive or at least very promising to me..  I do think there’s a role for the Congress but any time something gets in the hands of Congress that involves a lot of money it becomes a target of massive lobbying and campaign contributions and public relations campaigns and there can be a lot of exaggeration or distortion or political pressure that can cause legislative provisions that, in my view, won’t serve the country or innovation well.  I’ve been inclined to think that the evils of the patent system  or its shortcomings have been greatly exaggerated by certain companies, certain coalitions, certain individuals including some academics – and they all have something of a point, but in my view have greatly overstated the problems in the system and greatly underestimated the benefits of the system as it has functioned in recent years.  And one of the results of all this is that the Congress seems poised to try to pass what I guess can fairly be called comprehensive patent reform when maybe something much more selective and simple – something much narrower and easier would actually be better than this 150 page bill that tries to solve 50 different problems that have been alleged by somebody or other who can get the ear of Congress.  I’m hoping that the process can continue whereby the Congress is taking account of things that have been fixed by the Patent Office, by the private bar, by the Courts, and limit its legislative role to things that none of those institutions have or could fix.  I’m a little bit worried that there’s such a rush now to pass the House Bill 1249 that it may end up containing some good features, but many which will have harmful effects.  And I’m very hopeful that the Congress will slow down and be careful and having taken at least seven years in the effort will be willing to take another seven weeks or seven months perhaps – whatever it would take – to refine the existing proposal so that the beneficial features would all be retained and questionable or plainly improper ones would be deleted.  But it’s very unclear whether they have the patience and stamina to do a final round of refinements and corrections or whether they’re just going to pass it regardless.

THE REEXAMINATION CENTER:  Do you think that the provisions currently contained in HR 1249 as it relates to post-grant review and expanded reexamination are needed and warranted?

JUDGE MICHEL:  I don’t think they’re needed or warranted.  Congress has enacted two different post-grant reexamination procedures in recent decades and while many felt that they were not as fully utilized as desirable, that’s changed hugely in the last five or ten years and they’re now very commonly used – almost routinely used by any accused infringer who sees an advantage in pursuing reexaminations back in the Patent Office.  My perception is that they’re very easy to initiate because almost any competent patent lawyer can find one or more prior art references that weren’t before the Examiner  before the patent was granted and thereby frame a “substantial new question of patentability.”  So the threshold to prevent abusive post-grant reexaminations mainly designed to delay or harass the patent owner is not a meaningful threshold in my view.  It’s way too low, way too easy to meet and it’s met in over 90% of the cases.  So not only is there an existing and now well-utilized pair of reexamination procedures, but they actually are subject to abuse and I think are being abused today – not in every case, but in many cases – and that the improvement needed would be to tighten some of the safeguards, particularly the threshold to initiate reexamination in the first place.  And the problem with the Bill is not only what it does – creating a third, new, unproven procedure that they call” post-grant review”, but also leaves in place the current ex parte reexamination track, unchanged.  So with the special procedure for business method patents, there will be four different kinds of post-issuance review dealing with validity and one more dealing with inequitable conduct issues.  So I think adding more layers, more procedures in the post-grant phase is a bad idea – not justified – and will be additional weapons in the hands of accused infringers.  It seems to me that if you assume that nearly all patents are bad, then you say the more reexams we have, the better.  But if you take a realistic view of how asserted patents are carefully screened before people go the trouble to file a law suit – at least in most instances – and you consider the downside risks to the patent owner of getting his patent invalidated, either in the Court or the Patent Office, that whatever number of potentially invalid patents may be out there, very few of them are in court.  I don’t accept the assumption that most patents are bad and therefore the more reexams we have the better and who cares how long they take because that assumption also says that in the end they’re going to be invalidated.  But what about the ones that aren’t invalidated and may take years and years and cost enormous sums of money to a patent owner who meanwhile probably can’t enforce what turns out to be a valid patent?  And in the case of clear infringement, it doesn’t seem to me to be a just result that a valid patent that’s clearly being infringed can be made effectively unenforceable for something on the order of about a half a decade.

Read part 2 of 3 in this interview series here.

Read part 3 of 3 in this interview series here.