Source: http://271patent.blogspot.com/2008/04/
Timestamp: 2019-04-18 18:39:21+00:00

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NYT: Patent Reform "Boon To Lobbyists", Dudas Claims Applications Are Getting "Worse and Worse"
In a new article, the New York Times discusses some divergent perspectives on the patent reform act, noting that over the last 15 months, the Coalition for Patent Fairness and the Coalition for 21st Century Patent Reform collectively spent $4.3 million lobbying on the legislation (CPF = $2.5M, 21CPR = $1.8M). This number doesn't include amounts spent by other groups and individual corporations that could easily double this amount.
In the last 15 years, the United States Court of Appeals for the Federal Circuit, which handles patent cases, has affirmed findings of inequitable conduct in at least 40 cases, including 14 that involved pharmaceutical or health care products. Similar findings have been issued by federal district judges in an unknown number of cases that were not appealed.
We are getting more and more unpatentable ideas, worse and worse quality applications. Historically, in the last 40 years, the allowance rate — the percentage of applications ultimately approved — hovered around 62 percent to 72 percent. It went up to 72 percent in 2000, but dropped to 43 percent in the first quarter of this year.
We've seen a problem with quality . . . [I question whether the current system is] making it too easy for people who want to file poor [patent] applications?
[W]e’ve determined the quality of patents granted has been improving, and we expect this to continue because of current and future quality initiatives. A major concern we have at the USPTO--and it is a concern I have heard from many IP offices around the world--is the room for improvement in applications coming through our door.
Incidentally, IAM had a great article that discussed the "patent quality debate", where various IP leaders commented on patent quality (to see a brief except, click here). Quite interestingly, Alison Brimelow, President of the European Patent Office noted that, in her view, "[i]n spite of anecdotal evidence to the contrary, there is no hard empirical evidence that patent quality has substantially deteriorated in the last five or 10 years."
The applicants filed an application in 2001 under a petition to make special in order to accelerate examination. Two years later, the BPAI issued a first decision reversing the rejections on 2 claims, but sustaining the rejection to the other 64 claims, noting that "the appellants have not presented any patentability arguments for these claims." Aside from the procedural issues, no further analysis was given on the merits of reference-specific arguments made on the prior art.
The applicants filed a Request for Rehearing, which the BPAI granted, but refused to modify its original decision, concluding that the applicants "never explained how the limitations of the noted claims are patentable over the combined teachings of the applied references . . . Arguments pointing out the individual shortcomings in each of the applied references are not effective in overcoming a prima facie case of obviousness."
On appeal to the CAFC, the court stated that the applicants "misapprehended" the BPAI's decision, noting that none of the rejected claims contained the limitations which prompted the reversal. Also, the CAFC noted that the applicants admitted that each of the elements in the reversed claim "is known in the art." As a result, "[h]aving acknowledged that certain claim elements are taught by the prior art, Reuning cannot now defeat an obviousness rejection by asserting that the cited references fail to teach or suggest these elements."
The PTO also argued to the CAFC that the court should vacate and remand the decision to consider the merits of Reuning's arguments (since the appeal was based on a procedural issue). Finding this the "proper course," the CAFC vacated and remanded the application to the BPAI.
After twice denying Reuning a substantive review of claims 3-66—and taking over three years in the process—the Board, via the Director, now requests that we remand so that the Board can do what it should have done in the first place; namely, substantively review the examiner’s rejection of claims 3-66. By taking nearly three years to decline to adjudicate the merits of claims 3-66 on a procedural technicality, and by forcing Reuning to appeal before recognizing the superficial nature of its actions, the Board squandered judicial resources and needlessly frustrated Reuning’s interests. This is not a reflection of the Board’s finest work.
Although I assign the lion’s share of the blame to the Board for this case’s current posture, I wish to make clear that Reuning also is not without fault. He compounded the problem, and in a sense, invited the Board’s error, by unduly focusing on claim 1 in his appeal briefs and relying on happenstance for the Board to fill in the gaps. Although not technically improper, Reuning’s appeal brief to the Board was less than comprehensive and demonstrates the adverse consequences that may flow from arguments that are in some measure left to inference.
The end result is that as to claims 3-66, the parties are now back to where they started, albeit without the time and money it took them to get there. This wasteful course of proceedings does not promote the fair and efficient administration of justice and is inconsistent with the PTO’s mission "to ensure that the intellectual property system contributes to a strong global economy, encourages investment in innovation, and fosters entrepreneurial spirit." . . . I have the utmost respect for the members of the Board, the leadership of the PTO, and the members of the patent bar, and while I would like to believe that this case represents an aberration from the standards of practice I have long admired and have come to expect, I am concerned that it does not.
Back in July of 2000, Global Patent Holdings (GPH) (formerly Techsearch LLC) filed suit against numerous defendants alleging infringement of U.S. patent No. 5,253,341, which claimed an improved method and apparatus for downloading compressed audio and visual data as well as other graphical information from a remote server to an end user station for the purpose of decompressing and displaying the data.
Subsequently, a first reexamination proceeding was carried out, where the Board of Patent Appeals cancelled the 16 claims of the original patent and declared a new claim (claim 17) patentable. During that time, GPH requested and obtained dismissal of its complaint with leave to reinstate the case if the reexamination was resolved in its favor.
On August 8, 2007, Global Patent sued CDW Corporation and Motorola, Inc., in Global Patent Holdings v. CDW Corp., case No. 07 C 4476. In the meantime, a second reexamination request was filed in the PTO, and the Defendants moved to stay the proceedings in the case pending the outcome of the second reexamination procedure.
No discovery has been conducted and little judicial effort has been expended in either of the cases now before us. Though we are mindful that four years was consumed in waiting for the result of the reexamination of the original 16 claims, a significant amount of time and effort in claim construction and other litigation would have been wasted if we had forged ahead without the benefit of the PTO’s examination (and subsequent rejection) of those claims. Also, the fact that this examination will focus on a single claim makes it unlikely that a similar amount of time will be spent in reaching resolution of the new reexamination. The questions of validity, patentability, and claim content are common to the issues before this court and before the PTO, so the more prudent course of action is to stay these cases while the reexamination proceeds. Defendants’ motion requesting that relief is therefore granted.
Earlier, the Federal Trade Commission determined that Rambus, while participating in a standard-setting process on DRAM memory, deceptively failed to disclose to the standard setting organization (JEDEC) the patent interests it held in four technologies that were standardized.
On appeal, Rambus argued that the Commission erred in finding that it violated any JEDEC patent disclosure rules and thus that it breached any antitrust duty to provide information to its rivals. Second, it asserted that even if its nondisclosure contravened JEDEC’s policies, the Commission found the consequences of such nondisclosure only in the alternative: that it prevented JEDEC either from adopting a non-proprietary standard, or from extracting a RAND commitment from Rambus when standardizing its technology. As the latter would not involve an antitrust violation, there would be insufficient basis for liability.
Here, the Commission expressly left open the likelihood that JEDEC would have standardized Rambus’s technologies even if Rambus had disclosed its intellectual property. Under this hypothesis, JEDEC lost only an opportunity to secure a RAND commitment from Rambus. But loss of such a commitment is not a harm to competition from alternative technologies in the relevant markets. . . . Indeed, had JEDEC limited Rambus to reasonable royalties and required it to provide licenses on a nondiscriminatory basis, we would expect less competition from alternative technologies, not more; high prices and constrained output tend to attract competitors, not to repel them.
The court pinged the FTC for stretching a very thin evidentiary record to establish anticompetitive behavior. The parties stipulated earlier that, as of Rambus’s last JEDEC meeting, it held no patents that were essential to the manufacture or use of devices complying with any JEDEC standard, and that when JEDEC issued the SDRAM standard Rambus had no pending patent claims that would necessarily have been infringed by a device compliant with that standard.
As such, the only apparent grounds for supporting the FTC's opinion was that Rambus failed to fully disclose pending applications, as well as disclose progress on unfiled amendments at the PTO. However, the Appeals court found that the JEDEC policies did not explicitly address such situations, and, after looking at the trial record, concluded that "[w]e don’t see how a few strands of trial testimony would persuade the Commission to read this language more broadly."
As the Federal Circuit has said, JEDEC’s patent disclosure policies suffered from “a staggering lack of defining details.” . . . Even assuming that any evidence of unwritten disclosure expectations would survive a possible narrowing effect based upon the written directive of Manual 21-I, the vagueness of any such expectations would nonetheless remain an obstacle. One would expect that disclosure expectations ostensibly requiring competitors to share information that they would otherwise vigorously protect as trade secrets would provide “clear guidance” and “define clearly what, when, how, and to whom the members must disclose.”. . . This need for clarity seems especially acute where disclosure of those trade secrets itself implicates antitrust concerns; JEDEC involved, after all, collaboration by competitors. . . . In any event, the more vague and muddled a particular expectation of disclosure, the more difficult it should be for the Commission to ascribe competitive harm to its breach.
The D.C. Circuit's decision does not end the Rambus litigation, but merely returns the case to the FTC for possible retrial consistent with the court's opinion.
SIDE NOTES: From CNNMoney.com: "Michael Cohen, an analyst at Pacific American Securities, has estimated that Rambus could realize as much as $11.7 billion in total royalties from all makers of DRAMs, assuming the company was able to clear all of its legal hurdles."
Rambus currently has patent-infringement cases against many DRAM makers, including Samsung Electronics Co., Micron Technology Inc., Hynix Semiconductor Inc., and Nanya Technology Corp.
I originally thought I was out of the loop on this one, and then I couldn't find any notices from the PTO, and no chatter from the blogosphere. I'm currently at a loss as to what this is - any ideas?
By a jury verdict, the E.D Texas found that DirecTV willfully infringed Finisar's U.S. Patent No. 5,404,505 (the ’505 patent), and the jury awarded $78.9 million in reasonable royalty damages, and $25 million in enhanced damages. On appeal, DirectTV challenged numerous issues in the case.
Given “the importance of uniformity in the treatment of a given patent,” . . . this court would be remiss to overlook another district court’s construction of the same claim terms in the same patent as part of this separate appeal. In the interest of uniformity and correctness, this court consults the claim analysis of different district courts on the identical terms in the context of the same patent. Here, the Northern District of California’s efforts in the Comcast case are particularly helpful because that court repeatedly referred back to the Eastern District of Texas’s constructions—the subjects of this appeal.
Grammatical interpretation of prior art - Quite a bit of hay was thrown about over the interpretation of a passage in an anticipatory prior art reference. After analyzing referential and qualifying words and phrases, preceding antecedents, commas and modifiers, the CAFC concluded that "to avoid slipping into a realm of ambiguity that could render jury verdicts wholly unreviewable, this court imputes an understanding of English grammar and usage to the jury."
Finding that the new grammatical interpretation, coupled with additional supporting disclosure in the prior art, clearly and convincingly disclosed claimed features, the CAFC reversed the district court's denial of JMOL on anticipation.
Willfulness: The CAFC took issue with the district court faulting DirecTV in part for not obtaining an opinion on validity, weighing its failure to do so in Finisar's favor on the question of willfulness. Noting the Graco decision (“[t]here is no requirement that an opinion must address validity to negate a finding of willful infringement”), the CAFC concluded that "a competent opinion of counsel concluding either that DirecTV did not infringe the ’505 patent or that it was invalid would provide a sufficient basis for DirecTV to proceed without engaging in objectively reckless behavior with respect to the ’505 patent."
For computer-implemented means-plus-function claims where the disclosed structure is a computer programmed to implement an algorithm, “the disclosed structure is not the general purpose computer, but rather the special purpose computer programmed to perform the disclosed algorithm.” . . . Thus the patent must disclose, at least to the satisfaction of one of ordinary skill in the art, enough of an algorithm to provide the necessary structure under § 112, ¶ 6. This court permits a patentee to express that algorithm in any understandable terms including as a mathematical formula, in prose . . . or as a flow chart, or in any other manner that provides sufficient structure.
The district court correctly determined that the structure recited in the ’505 specification does not even meet the minimal disclosure necessary to make the claims definite. Simply reciting “software” without providing some detail about the means to accomplish the function is not enough . . . This court does not impose a lofty standard in its indefiniteness cases . . . But in this case, the claims are already quite vague. Without any corresponding structure, one of skill simply cannot perceive the bounds of the invention.
On Friday, the Wall Street Journal ran an article claiming that S. 1145 has hit an "impasse" at the Senate, and quoted Pennsylvania's Sen. Arlen Specter as saying "I think we need more time to get it right." More telling however, was a quote from Senate Judiciary Chairman Patrick Leahy, who spoke of the bill in past tense, saying that the bill "was a missed opportunity," adding that the dispute over S. 1145 was over "just a handful of words" and further warning that "thousands of hours" spent on negotiations were at risk of being wasted.
Also, it was reported by Hal Wegner that after last Wednesday's Giles Sutherland Rich American In of Court meeting, John Whealan announced to several members that he would be leaving his temporary position with Senator Leahy on May 1, 2008. Whealan has been the Deputy General Counsel for Intellectual Property Law and Solicitor for the USPTO since 2001. Over the last year, he has been on leave to assist Leahy with S. 1145. Some are questioning if Whealan's move is indicative of a dying bill that has, so far, failed to generate the level of support hoped by its proponents . . .
Last week, Peter Detkin, founder and Vice-Chairman of Intellectual Ventures (IV) was quoted as saying that small inventors only received the "crumbs" when it came to patent licensing revenue. Apparently, this statistic was generated by IV, but has been picked up from the likes of Acacia Research, which claims in this presentation from March 2008 that only 1% of patent revenue and distribution is received by small companies, individual inventors, universities and research labs.
He [Detkin] said that the mission of the patent system is to encourage and reward inventions and disclosures. Small inventors, defined as those entities that have less than 500 employees are responsible for 60% of US patents while the remaining 40% are granted to large companies. On the other hand, large companies collect over 90% of revenues derived from patents, while small companies are left with the "crumbs". He also pointed out that the average time required to go through the patent application process is now close to four years, and that, on the average, it takes just as long for a small inventor to negotiate licensing rights with a large company.
I haven't encountered any statistical breakdowns of licensing revenue along these lines, and I'd be interested to find out where Detkin obtained these numbers. If the statistics are accurate, this could easily serve as fodder for any upcoming patent reform debates.
The United States Patent and Trademark Office (USPTO) is initiating a pilot program in which, in certain art areas, applicants who comply with the requirements set forth in this notice will receive the results of a prior art search conducted by the examiner, via a condensed Pre-Interview Communication, and then be permitted to conduct an interview with the examiner to discuss the cited prior art references, before the examiner issues an Office action on the merits that sets forth the rejections.
The pilot program will last until November 1, 2008. Any request for a first action interview filed on or after April 28, 2008, and before November 1, 2008, will be granted if all of the requirements set forth in the Requirements section of this notice are satisfied.
A CIP patent asserted by PowerOasis was challenged in the district court over prior art that became available before the CIP, but after the filing date of the parent patent. After finding that the parent application did not provide support for the subject matter claimed in the CIP (i.e., could not be relied on for priority), the district court granted summary judgment of invalidity in favor of T-Mobile.
On appeal, PowerOasis argued that it was improper for the district court to place the burden on the patentee to show that it was entitled to the priority date of the Original Application. Additionally PowerOasis argued that the district court erred in denying priority, and, at a minimum, there was general issue of material fact that prevents summary judgment of invalidity.
Unless the filing date of the earlier nonprovisional application is actually needed, for example, in the case of an interference or to overcome a reference, there is no need for the Office to make a determination as to whether the requirement of 35 U.S.C. 120, that the earlier nonprovisional application discloses the invention of the second application in the manner provided by the first paragraph of 35 U.S.C. 112, is met and whether a substantial portion for all of the earlier nonprovisional application is repeated in the second application in a continuation-in-part (MPEP §201.08).
requirement is a question of fact but is amenable to summary judgment in cases where no reasonable fact finder could return a verdict for the non-moving party.
Since the CAFC did not find support in the original application for the disputed feature, the court affirmed the denial of priority and findings of invalidity.
Regarding expert testimony that declared that the disputed features were "well known to those of ordinary skill," the CAFC rebutted that "[a]t best, this is a statement that it would be obvious to substitute a customer laptop for the user interface disclosed on the vending machine. Obviousness simply is not enough; the subject matter must be disclosed to establish possession."
Instead of separately arguing each claim under a subheading as required by 37 C.F.R. § 41.37(c)(1)(vii), the Appellant in this case generally argued features without making specific references to the claims.
During the Appeal, Appellant offered to cancel the broadest claim set (claim 7), contingent upon the resolution of the other claims sets (claims 1 and 15). While the offer to cancel was made through the Reply Brief, no cancellation was made. Since the Appellant's arguments were not claim specific, the BPAI merits board selected the broadest claim (claim 7), for deciding the appeal. Affirming the rejection to claim 7, the Board applied that result to all of the appealed claims.
As a matter of policy, based on a need for efficient handling of the ex parte appeal and inter partes interference dockets, the Board of Patent Appeals and Interferences (“Board”) does not enter into contingent arrangements in which the withdrawal or dismissal of a claim is conditioned upon commitments to or restrictions on future Board action . . . Thus, an Appellant in an ex parte appeal may not seek to have a claim withdrawn or dismissed from an appeal based on a condition that the Board take or refrain from taking action on one or more other claims. If an Appellant wants an appeal withdrawn or dismissed as to a particular claim, the proper course of action is to file an amendment canceling the claim.
The saving grace for the Appellants in this case was that (1) the case was one of first impression, and (2) it was clear that everyone understood that claim 7 was to be canceled. Accordingly, in "an abundance of fairness", the expanded board remanded claims 1 and 15 for further consideration that is consistent with the features contained in those claims that were argued by Appellants.
In taking the action we take today, we wish to make clear that publication of this opinion is intended to put appellants on notice of the ineffectiveness of a conditional withdrawal of a claim. With this notice, appellants should not expect the Board in the future to exercise discretion to permit them from avoiding the consequence of such an approach. Adherence to the requirements of the rules is essential if the Board is to efficiently handle the increasing docket of ex parte appeals it is currently receiving.
The 271 Blog covered this important (albeit bizarre) 35 U.S.C. 101 decision back in February (link), where the expanded board held that utility must be "substantial" and "specific." Shortly after the blog post went up, the USPTO posted the decision as "precedential."
Today the Congressional Quarterly (CQ) is reporting that Senator Arlen Specter (R-PA) is pulling his support for S.1145, stating that he "cannot join" his colleagues "on some parts of the bill, citing apportionment of damages as a "principle sticking point."
Patrick Leahy, the chairman of the Senate Judiciary Committee has reportedly been working on introducing the amendments to S.1145 for several days and even reserved the television studio two days in a row this week, only to cancel both times. Support for the bill does not appear to be strong at this time - the CQ article notes that Leahy acknowledged that he "will need every vote he can find to advance the bill through the Senate."
Cosponsor Orrin Hatch (R-UT) has also voiced reservations about S.1145, and made clear this week that his support for the bill is contingent on the inclusion of his language for amending inequitable conduct (currently Hatch is "optimistic" that his language will be included).
In a separate but related news story, the Dow Jones Newswires are reporting that Senator Jeff Sessions (R-AL) is dropping the "Check 21" provision completely from the bill, stating "I don't know how [the provision] can be modified" to pass constitutional muster. Tuesday, Sessions indicated that he likely wouldn't attempt to fix the amendment. House Speaker Nancy Pelosi (D-CA) has previously voiced her opposition to the amendment.
The quote that best summarizes the situation is from Senator Sessions himself: "I think this has more to do with lobbyists than it does with merits . . . This has been a lobbyist money machine. They're all over the place around here."
Who at the USPTO Will Fix Inter Partes Reexaminations?
The American Inventors Protection Act, signed into law on November 29, 1999, made a number of landmark patent reforms, including the establishment of an inter partes reexamination procedure.
Initially shunned by 3rd parties, inter partes reexamination practice has grown considerably in the last few years: in 2003, only 23 requests were filed in the USPTO; in 2007, 126 requests were filed (see PTO statistics here).
To date, the BPAI has not issued a single final decision on any inter partes reexamination.
Recently, the BPAI issued Watson & Chalin Manufacturing, Inc. v. Hendrickson USA, L.L.C., 2008 WL 345059 (PTO Bd. App. & Int. 2008), which, as noted by the good professor Hal Wegner, is only the third inter partes decision in history (presuming that Westlaw's reporting is complete). And despite the statutory requirement for "special dispatch", the reexamination languished in the PTO for 5 years (since 2003); the other two BPAI inter partes decisions (Lobo v. Congoleum and NEC v. Entegris) had to wait 4 years to get their decisions.
Why weren't the decisions "final"? In each case, the Board "played examiner" and instituted new grounds of rejection. Because a new rejection is introduced, the decision cannot be final, and cannot be appealed to the CAFC until there has been a rehearing at the Board, or prosecution is reopened.
This is worrisome stuff. Considering that post-grant review is such a crucial part of patent reform, someone at the PTO needs to explain what policies and procedures the Office intends to implement to avoid having the same problem when (if?) patent reform is enacted.
In a historic moment, Lot 25, a notable IP portfolio owned by the subsidiary of a world-renowned multi-national corporation, sold for $6,600,000, setting a new world record for the highest selling price for a patent lot at a multi-lot live IP auction. In addition to the Lot 25 record-breaking sale, related to the processing of digital data in bit streams, the auction heralded three other transactions in the seven-figure range in the areas of computer systems and software, information management and data system, and location based services and logistics.
Fifty-three of the eighty-five offered lots were sold on the floor for a 62% transaction success rate, and forty-three of the sixty-nine sellers sold lots resulting in a 62% seller success rate. Other successful sellers included venture-backed companies, individual inventors and large multi-national corporations.
Organisations are willing to pay top dollar when they come across assets they want to get their hands on. And it’s not only at auctions that this is happening. Look at RIM, for example, which last week announced that it had spent over $300 million on acquiring intangible assets in the 4th quarter of its financial year. This amount includes €120 million ($188 million) spent on acquiring a European patent portfolio at the end of last year. Then there’s patent brokerage IPotential, which raised $104 million for clients in 29 transactions during 2007. And these are just two examples of IP monetisation that have come into my head immediately. Many reading this will know of quite a few more, I am sure.
- CNET has a great "on the scene" report on the Ocean Tomo auction, and can be accessed here.
- Read more from the IAM Blog here and here.
- There's also this interesting report from Market Watch, which highlighted the plight of one inventor (Yongyong Xu), who didn't generate much interest from the bidders, but, "[a]s the auction drew to a close, however, Xu slipped into conversation with a group of men outside in the hallway. He reported later that there is some enthusiasm about 'licensing and litigation' opportunities for his patent, though the interested parties would like more time to examine it."
When a defense of invalidity under Section 282 rests on documentary evidence that was not considered by the United States Patent and Trademark Office, whether the factual predicates of the defense must be proved by “clear and convincing evidence” or some lower burden of proof.
Read the petition here (link), and read more over at Patently-O.
Last year, the EPO received a record total of 218,200 patent filings, compared to 210,600 the previous year. At the same time, the 54,700 European patents granted in 2007 represented a decrease of 12.9% over the previous year (62,800 granted patents).
Debate on Patent Reform Act to Begin "As Early As Next Week": A spokeswoman for Senator Harry Reid (D-Nev.) said the majority leader is committed to bring S.1145 to the Senate floor in the current working session which ends in late May. "It could come up as early as next week," she said (link).
Sen. Clinton Questioned on Patent Reform on Campaign Stop: A local inventor and entrepreneur reportedly pushed and shoved his way through a crowd in Pennsylvania to ask Sen. Hillary Clinton a question on the Patent Reform Act. According to the inventor, she opposes anything in the bill that would hurt manufacturers (link).
Rating the Examiners: A new website has been created that has a message board allowing people to "rate" examiners (and also allow examiners to rate practitioners). There's even a kind post from an alleged EPO examiner that names yours truly (in case you're feeling cynical, no: I didn't put that post there myself). Click here for more info (link).
Carlos Gutierrez from the Department of Commerce sent a letter today to Arlen Specter, expressing "strong support" for a "key element" of S. 1145: Applicant Quality Submissions (AQS).
The Administration strongly supports the AQS provision in the bill in its current form and believes that enactment will prove to be the strongest step toward improved patent quality. By reducing the number ofpoor quality and imprecise applications, applicant quality standards will result in dramatic reductions in patent pendency and backlog, as well as reduce the likelihood of excessive litigation. The current misalignment of information incentives slows and degrades the patenting process.
There is no one who has greater opportunity, information, or incentive to explain why an application deserves a patent grant than the applicant. There has been a sharp decline in the percentage of patents allowed, due in part to comprehensive internal quality improvements. However, the USPTO is now applying more than 55 percent of its examination resources to examining applications that do not warrant a patent. In order for additional quality and efficiency gains to accrue, the system must focus on the quality of applications. Stated simply, our innovation system can no longer afford the time and the cost of heavily subsidizing poor quality patent applications, which crowd out our most important innovations. Applicant quality standards are essential to improving and expediting the process by which new and innovative ideas become reality.
[T]he Administration strongly opposes any statutory changes to the doctrine of inequitable conduct in the absence of a strong provision requiring Applicant Quality Submissions. Applicant quality standards and inequitable conduct reform are inextricably linked. Diminishing the penalties for misrepresenting facts before the United States Patent and Trademark Office (USPTO) without also increasing the robustness of the process for eliciting quality information from applicants may lead to poorer quality applications, in tum increasing the difficulty of conducting accurate examinations. Inequitable conduct reform alone, without Applicant Quality Submissions, would merely invite fraud on the patent system.
The 26 page opinion mainly addressed the "substantive" aspect of the rules and didn't stray further.
Expect the PTO to hit Congress hard on S.1145 to give it statutory authority - such a provision would effectively override the district court's ruling.

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