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Patent Office ‘in Neutral’ as It Awaits Biden’s Pick to Lead It

Sept. 10, 2021, 9:00 AM

The lack of a permanent U.S. Patent and Trademark Office director has left attorneys guessing about how the agency will tackle some high-profile policy questions.

The patent office has been grappling with issues such as review of Patent and Trial Appeal Board decisions and how its examiners should determine if certain inventions are eligible for patents. Progress on those issues is largely stalled until a new director is in place.

It’s a waiting game for attorneys because the agency official temporarily performing the director’s duties, Drew Hirshfeld, isn’t setting policy in some areas while the office awaits a U.S. Senate-confirmed director.

“Everything has been kept in neutral and just cruising along,” said Joseph Matal, a Haynes and Boone LLP partner who temporarily led the agency early in the Trump administration. “It’s surprising that we’ve all had to wait that long, but I don’t see the agency’s interim leadership as having any choice.”

In some areas, like the process for the director’s review of PTAB decisions, attorneys can only follow the interim guidance for now, Michelle Armond, a founding partner at Armond Wilson LLP, said.

“Attorneys have been dealing with lots and lots of quick changes here,” Armond said. “This is just another instance where we’re waiting to see, but we do have interim guidance and then we’ll see what the new director does and everyone will adjust their approach accordingly.”

The administration has been tight-lipped about whom President Joe Biden will tap to lead the agency, and slower than the past two administrations in making an announcement. The Trump administration announced Andrei Iancu’s selection in late August 2017, and the Obama administration named David J. Kappos in June 2009.

The White House didn’t immediately respond to a request for comment on the timing of an announcement.

Armond said Hirshfeld hasn’t fully explored the authority of the director to review PTAB decisions, a power the Supreme Court conferred in June in United States v. Arthrex. As of Aug. 30, Hirshfeld had denied all requests for him to overturn the PTAB’s findings.

The agency unveiled an interim process for the director’s review of PTAB decisions in late June, though Armond said it’s still an area for the new leader to make an impact.

“That’s a big power for the PTO director to put their thumb on the scale and impact PTO policy,” Armond said, adding that Biden’s nominee is likely to face questions on the issue during the U.S. Senate confirmation process.

The Arthrex decision raised questions about the fate of the agency’s Precedential Opinion Panel, which Iancu created in 2018 to review important issues and set precedent at the PTAB. The panel included the director and other agency officials.

The agency said the POP remains unchanged, for now. Attorneys said they are left wondering what to do if the panel is about to become obsolete.

“Should stakeholders be filing requests for POP review? Does the POP even exist anymore?” said Bridget Smith, a patent attorney at Lowenstein & Weatherwax LLP. “We don’t have that transparency in the office anymore.”

Patent Eligibility

Attorneys also hope that a new director will provide more clarity on how patent examiners should apply the standards courts use to determine whether some inventions qualify for a patent, after Supreme Court decisions on the subject created uncertainty regarding patent eligibility.

Inventions involving software or diagnostic medical testing are vulnerable to being rejected as ineligible for patents. Lower courts and patent examiners have struggled to apply the eligibility criteria. The patent office launched a study in July on how the case law might be harming innovation in the technology and medical industries.

The new director will be able to issue new guidelines on how patent examiners will consider the standards when reviewing applications.

“Medical patents and software patents are really the stars of the show when it comes to subject matter eligibility. Are people in those areas going to be able to protect those patents on life-saving technology? We don’t know,” Smith said. “It would be great to have certainty again.”

Biden’s eventual pick to lead the agency is not likely to be confirmed for months after he submits the nomination. Intellectual property attorneys say that can’t happen quickly enough.

“It should obviously be a high priority because it impacts American innovation, which is so important right now,” Smith said. “Hopefully we get a new director soon.”

To contact the reporter on this story: Samantha Handler in Washington at shandler@bloombergindustry.com

To contact the editors responsible for this story: Keith Perine at kperine@bloomberglaw.com; Kibkabe Araya at karaya@bloombergindustry.com

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