PTAB institutes 6 IPRs challenging RESTASIS patents

The Patent Trial and Appeal Board (PTAB) of the United States Patent and Trademark Office (USPTO) recently instituted six separate inter partes reviews (IPRs) against patents owned by Allergan plc (NYSE: AGN), which cover RESTASIS® (Cyclosporine Ophthalmic Emulsion) 0.05%. RESTASIS® is an eye drop that helps increase the eyes’ natural ability to make tears. Mylan Pharmaceutical Inc. says they expect PTAB decisions on the IPRs sometime during the fourth quarter of 2017.

All the challenged patents are set to expire on August 27, 2024 and are listed in FDA’s Orange Guide. The patents being challenged are U.S. Patent Nos. 8,629,111 (the “‘111 patent”), 8,633,162 (the “‘162 patent”), 8,642,556 (the “‘556 patent”), 8,648,048 (the “‘048 patent”), 8,685,930 (the “‘930 patent”), and 9,248,191 (the “‘191 patent”). Hatch-Waxman litigations involving these patents against Mylan and other generic defendants remain pending in the United States District Court for the Eastern District of Texas.

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USPTO instructs examiners on patent eligibility cases

The United States Patent and Trademark Office recently issued a new memorandum to patent examiners on recent software patent eligibility decisions from the Federal Circuit. The memo sent to patent examiners provides discussion of McRo, Inc. v. Bandai Namco Games America and BASCOM Global Internet Services v. AT&T Mobility.

The PTO acknowledges in the memo that the Federal Circuit even more recently issued another precedential decision in Amdocs (Israel) Ltd. v. Openet Telecom, which will be discussed in forthcoming subject matter eligibility guidance. For more on that case, please see Software eligible because it recites technical solution to technical problem.

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Hearing on Examiner Fraud Leaves No Resolution

In mid-September, the House Judiciary Committee held what seemed like it was going to be an oversight hearing to address the allegations of timekeeping fraud by patent examiners made in the Inspector General’s recent report. Prepared statements released in advance of the hearing talked tough, but that was pretty much it. Insofar as getting to the root of the problems identified in the IG report the hearing turned out to be a big, fat nothing.

Congressman Jerrold Nadler (D-NY) (pictured left at the hearing) defended the Office in his prepared remarks, explaining that there were flaws with the methodology of the IG study, which make the conclusions unreliable. For example, it is entirely possible that patent examiners were indeed working while they were not logged into the Patent Office computer systems. After all, examination is a job that requires a lot of reading and contemplation, much of which might occur without being logged into the server. Of course, that, at best, means there is no way to know whether patent examiners are working or not, which is why the IG report recommended the sensible step of requiring patent examiners to log into the Office computer systems whenever they are working.

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USPTO Director Lee testifies before House Judiciary Committee

On the afternoon of Tuesday, September 13th, the intellectual property subcommittee of the U.S. House of Representatives Judiciary Committee convened for a hearing on oversight of practices and procedures at the U.S. Patent and Trademark Office. The day’s sole panelist was USPTO director Michelle K. Lee. The day’s discussion focused on recent reports from federal governmental agencies regarding issues at the USPTO surrounding patent litigation as well as time and attendance abuses among USPTO examiners.

A press release posted in advance of the hearing contained statements from both House Judiciary Committee chairman Bob Goodlatte (R-VA) and Courts, Intellectual Property, and the Internet subcommittee chairman Darrell Issa (R-CA) provided a good indication of the direction the hearing would take. Both statements reflected a wariness regarding timesheet abuses among USPTO employees. “The amount of wasted man-hours that could have been spent reducing the patent backlog is astounding, not to mention the millions of taxpayer dollars that were wasted paying USPTO employees for work they were not doing,” Goodlatte’s statement read. Issa added, “If the PTO can’t even guarantee sufficient oversight of its employees timecards, how can we be assured patent examiners aren’t just rubberstamping ideas without oversight as well?”

The concerns of both Congressmen stem from an examiner time and attendance report issued August 31st by the Office of the Inspector General (OIG) within the Department of Commerce. The Commerce Department’s OIG found 288,000 unsupported hours of work claimed by examiners over a 15-month period, which was equated to more than $18.3 million in potential waste. The OIG report also found multiple weak points in USPTO policy which limits the agency’s ability to detect fraud, including no requirement for teleworking examiners to log into computers during workdays as well as no requirement for workers with average or high performance ratings to provide supervisors with work schedules.

The methodology used during the OIG’s study on time and attendance abuse was also questioned by Congressman Jerrold Nadler (D-NY). Nadler’s prepared remarks noted that the unsupported work hours identified in the OIG’s report amounted to less than 2 percent of all hours worked by examiners during the 15-month period of the study. “In fact, the IG acknowledges that after the USPTO instituted certain reforms to its telework policy, six months into the study, the percentage of unsupported hours dropped to just 1.6%, an efficiency rate that most employers would boast about,” Nadler’s prepared remarks stated. “But, the IG buried this fact in a footnote deep in the report.”

“My team and I do not tolerate time and attendance abuse,” Lee told the subcommittee. While she did note that the USPTO had taken disciplinary actions against examiners that have abused time and attendance reports, such actions ranging from counseling to expulsion and repayment for hours not worked, she added that there was evidence that instances of time and attendance abuse were not widespread. She cited a report on the USPTO’s telework program issued by the National Academy of Public Administration (NAPA) in July 2015. The report found that “It would appear to be unlikely that [time and attendance] abuse is widespread or unique to teleworkers, and it does not appear to reflect the actions of the workforce as a whole.”

Alice Experts and the Return of Second Pair of Eyes to the PTO

“I have not yet run into an Art Unit that does not have someone designated as an Alice expert,” explained JiNan Glasgow of Neopatents. “They won’t always tell you who it is, but they all say they have an Alice expert.”

While discussing the importance of doing interviews in every single case, Glasgow explained that although it is not something that has been generally publicly disclosed by the Patent Office, “in every art unit examiners confirm that there is an examiner within the Art Unit who is the Alice expert and that examiners have said that even if they are ready to allow a case, nothing can be allowed without the approval of that Alice expert.” This applies to TC 3600 and beyond, according to Glasgow.

If what examiner after examiner has told Glasgow is correct, this means there is essentially a return to the so-called “second pair of eyes” review at the Patent Office.

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