The Reexamination Center Executive Interview: Chief Judge Paul R. Michel (part 2 of 3)
August 31st, 2011
With patent reform legislation looming on the not too distant horizon, The PTO Litigation 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.
THE REEXAMINATION CENTER: Do you feel that legally the separation of powers in the Constitution has been violated in a situation where the Federal Circuit has affirmed the validity of a patent and now it’s in reexam and the same claims have now been found to be invalid on the same art?
JUDGE MICHEL: Well I don’t know if it’s a breach of the Constitution, but I think it’s an extremely unfortunate, unwise result to permit. It seems to me if a patent has been upheld in Court, particularly in the face of some specific challenge – some specific prior art, for example – to permit the Patent Office subsequently to invalidate the patent based on the same prior art seems like a terrible result to me. So whether or not there’s a constitutional problem, I think there’s a serious policy problem and there’s a very bad appearance problem. You know, part of the patent reform debate in its larger dimension – not just the part relating to post-grant review – assumes that the Courts can’t do their job right – that Court results aren’t dependable. I find that highly questionable. From my experience, and I must have sat on well over 1,000 patent cases – maybe 2,000 – I really never made a count – over the 22 years, the trial courts, in a very large percentage of the cases, did quite a good job and so did the juries and the results, with a few exceptions, looked fair and just and reliable to me. To the extent that the patent reform bill or the post-grant procedures in particular are based on the assumption that the Courts usually get this wrong and allow bogus patents to stand and find infringement when it isn’t there, etc. – I don’t accept that. I think that’s propaganda, not fact.
THE REEXAMINATION CENTER: The argument is often made that the Patent Office, as an administrative agency with great expertise, is a better forum for decisions relating to patents and printed publication prior art. So from the perspective of a District Court Judge, what impact is this parallel universe that exists between the courts and the patent system having on the ability to enforce patents in the District Courts?
JUDGE MICHEL: Well, it’s a very bad effect. The District Courts in all 94 districts are overburdened and in about a third of the districts – the metropolitan districts – severely backlogged and overburdened. And therefore the pressure is on District Judges – if there’s any pending proceeding in the Patent Office of any sort whatever – is to stay forward progress in the infringement case. And the infringement case normally takes three to six years to get to a final result anyway between discovery and motions practice and trial and post-trial and appeals. So the delays are already upwards of a half a decade and if a case is going to be put in the deep freeze for let’s say five years to go through the reexam process and two levels of appeals – at least under current law – then you’re talking about potentially another five years. So now you could have a valid patent that’s being plainly infringed that might not be enforced for almost a decade. I just find that horrific. Patents ought to be enforceable within 18 months just the way they ought to be granted within 18 months, in my opinion. I’m very upset with the impact on getting justice in the Courts that the long delays and the multiple post-grant channels are increasingly causing.
THE REEXAMINATION CENTER: Now the length of time even with the push that the Patent Office is making to speed up the reexamination process is considerable and can often take four to eight years to work through the Central Reexamination Unit to the Board of Appeals and then to the Federal Circuit. In light of that, Judge, do you feel that District Court Judges confronted with a stay request should be loath to grant a stay? Or under what circumstances do you think it’s appropriate for a District Court Judge to grant a stay?
JUDGE MICHEL: Well, maybe I’m not experienced enough to be able to set out some sort of formula. I think it would be very desirable for the country and for innovation and for job creation and economic growth and recovery from recession and all the rest for patent applications to get prompt action and for infringement law suits to get prompt action. And the country seems to have been headed for a least a decade in the direction of slower and slower when it needs to get faster and faster in both those pathways. And, so, when you get the interplay where post-issuance reexaminations can take years and years and years, and then the subsequent enforcement could take many, many years more, I don’t see how that gets past the adage that “ justice delayed, is justice denied.” If you own a valid patent and I’m infringing it, but it’s going to take 10 years for you to get any kind of a remedy because of the parallel universe being pursued sequentially, I don’t see how you’ve gotten justice.
THE REEXAMINATION CENTER: Now going to this justice delayed is justice denied, the situation where the requestor files the reexam request later in the trial proceeding or maybe even after verdict or even on appeal, should a Court grant a stay in that circumstance in your opinion?
JUDGE MICHEL: It’s hard to imagine a case where the trial has already been held where stopping the judicial machinery and waiting for years for the PTO would be justified and productive. I wouldn’t even favor granting stays where a case is nearly ready for trial. If discovery has been finished, it would seem to me too late to start post-grant type proceedings in the Patent Office. If they’re filed within months – a few months of the filing of the complaint, that’s a totally different matter. But part of the problem is the threshold is so low in the Patent Office in the current reexam proceedings. In that sense, I think the Bill makes a big improvement at least as to inter partes reexamination – renamed “inter partes review” – because at least they raised the threshold and they have substantial estoppel provisions and other safeguards. But since the low threshold and the lack of safeguards associated with ex parte reexamination continue, it’s not good enough to tighten up the inter partes track – particularly when they’re adding this new post-grant review track and the inter partes proceeding can’t even start, as I read the Bill, until after the post-grant review had concluded. And that might take several years by itself. So you could have a reexam – an ex parte reexam filed first, and then a little later a post-grant review. And then after that’s concluded, an inter partes review. And with appeals and overlapping timeframes, you could be talking about four or five, six, seven years before it’s all over even if the proceedings ultimately are merged or consolidated in some fashion. So it seems to me the potential for abuse is substantial today and it will increase hugely if the Bill is passed with their current post-issuance provisions.
THE REEXAMINATION CENTER: In the current system where you have a reexam concurrently being handled on the same claims that are being enforced in the Courts, and the District Court decision is now before the Federal Circuit, but the reexam is still being processed at the Patent Office, should the Federal Circuit wait for the reexam to catch up or should it decide the decision before?
JUDGE MICHEL: Well, my personal preference is that Trial Judges and Appellate Judges should decide cases expeditiously and I think it’s a very rare circumstance where either level of the judiciary is justified in stopping forward motion and awaiting some action in some other part of the government.
THE REEXAMINATION CENTER: Now the Patent Office in current reexam practice has a different burden of proof and different claim construction rules than the Courts do for the same claims and the same prior art. Do you think that that’s appropriate and warranted? I know that the argument is that the patent owner can amend claims in reexam and not in the Courts, but from a system integrity perspective and public policy viewpoint, do you think that the different rules are appropriate?
JUDGE MICHEL: Well, it is certainly awkward where you have Court proceedings and Patent Office proceedings overlapping one another. I can see the argument for broadest reasonable interpretation of claim scope as a way to prompt narrowing amendments. But in the final stage of a reexamination, it seems to me that the construction of the patent claims should be the same as in Court, because otherwise we have a potential for opposite results, which just makes a mockery of both systems.
THE REEXAMINATION CENTER: Now the Patent Examiners are – under the current system – are loath to take attorney argument as being persuasive and instead rely on record evidence that is produced through the Rule 131 and 132 Declaration approach or mechanism. That evidence, of course, is not subject to cross examination. It’s merely submitted and made part of the record. Do you think that that system is one that is protective enough of the patent owner and also the public interest or should there be some type of ability for the Central Reexamination Unit to cross examine, if you will, the Declarants?
JUDGE MICHEL: Well, cross examination has for centuries been relied on as the principal guarantor of getting to the truth in English and American jurisprudence, and in many other countries as well. And over and above cross examination by opposing parties attorneys, any tribunal needs an ability to sort out conflicting assertions. So one of the things that troubles me about the Patent Office procedure is the lack of cross examination, the lack of live witnesses. Another thing that troubles me is the lack of experience and training and ability to explain in opinions how conflicting expert Declarations are reconciled or sorted out or assessed. In Federal Court, that’s usually the heart of the controversy : who should be believed when saying what? It looks to me like the Patent Office procedure sort of skips over that aspect of adjudication in favor of what I suppose is regarded by some as neutral technological expertise by the Examiner or re-Examiner so he doesn’t – or she doesn’t – need to sort out the conflicts because they’re going to see the truth on their own and just ignore the Declarations. But I don’t like that approach either because it ignores the evidence submitted by the two sides. That doesn’t seem right. And if the adjudicator doesn’t sort out the conflicts or assess the credibility of the Declarations, I don’t see how you can get a reliable and just result in the eyes of the law or even a technologically correct result.