IP Policy Shifts Are Promising for Patent Owners in High Tech

Under the Trump administration, intellectual property policy appears to be leaning toward stronger protections for patent owners. Shifts at the US Patent and Trademark Office and broader regulatory moves are poised to affect how companies approach innovation, risk, and IP portfolio management.

In sectors such as financial services, manufacturing, and semiconductors—where technological progress and domestic investment are accelerating IP values—the stakes have never been higher.

The changes afoot generally signal an increased role for patents in the innovation economy and may present patent owners with additional opportunities for enforcement.

Speeding Up Prosecution

The USPTO has renewed efforts to reduce examination delays and accelerate appeals while maintaining quality. Pendency was a key topic during Secretary of Commerce Howard Lutnick’s confirmation hearing and has remained a prominent topic ever since.

Amid criticism in a Government Accountability Office report released publicly last month, the USPTO touted the increased role of artificial intelligence to improve quality and increase the examination corps’ efficiency. And the office recently announced that pendency from issue notification to grant is down to two weeks.

Lutnick has pledged to cut into the patent backlog by launching initiatives to reduce pendency. One mechanism the USPTO could use is to further expand the use of examiner interviews. The USPTO previously expanded the use of examiner interviews to resolve more cases and may do so again once director nominee John Squires is confirmed.

Squires has expressed alarm at the growing backlog of pending applications and said he’ll waste no time in tackling the issue. During his recent confirmation hearings, Squires acknowledged the importance of maintaining quality while addressing the backlog. He forecast that AI technologies could be a force multiplier for the USPTO in realizing higher quality in less time.

Faster prosecution times and streamlined Patent Trial and Appeal Board proceedings generally enhance predictability and reduce strategic uncertainty for applicants.

When patentees can act on granted rights more swiftly, it gives those rights real commercial impact, which is important in fast-moving industries where time-to-market can make or break return on investment.

For example, if startups could secure protection within their first funding/innovation cycle (a benchmark that has so far been difficult to attain), they could move more swiftly into commercialization.

Discretionary Denials

Accused infringers or those seeking freedom to operate often turn to the PTAB to challenge patent validity. Those petitioners enjoy an elite technical panel well-versed in patent law. While it’s a difficult forum for all parties, it remains popular and is among the most active forums for patent disputes.

A fundamental shift is taking place at the PTAB, where evolving guidelines on discretionary denial appear to respond to patent owners’ concerns. While discretionary denial has long sought to address duplicative issues with parallel district court litigation, the PTAB has begun incorporating broader societal and policy factors when deciding whether to institute inter partes review.

Recent cases, including Motorola Solutions, Inc. v. Stellar, LLC, illustrate how compelling economic, public health, and national security interests are part of the consideration in the director’s discretionary denial decisions.

Such considerations echo the domestic industry and public interest aspects of the International Trade Commission’s jurisprudence and signal a convergence of IP and trade policy. Invalidating a patent is now more than a consideration of the four corners of the prior art—it’s a policy decision that considers the role of the parties in society.

The impact of the new PTAB jurisprudence comes as Congress is taking up legislative reform in the Patent Eligibility Restoration Act, the Promoting and Respecting Economically Vital American Innovation Leadership Act, and the RESTORE Patent Rights Act.

By restricting who may file an inter partes review, the PREVAIL Act may make it more difficult for innovators to secure just, speedy, and inexpensive resolution of disputes before the PTAB.

Geopolitical Edge

The effects of these USPTO changes intersect with the broader regulatory and trade environment. With the Trump administration’s call for increased domestic production and tariffs impacting trade, some companies are making multi-billion-dollar commitments to shift production to US soil.

Products such as mobile phones, semiconductors, automobiles, and building materials that have long been staples of foreign production may see a bump in domestic manufacture.

US patent owners may see an increase in the value of their patent portfolios. More domestic production would mean more potential targets for infringement lawsuits in district courts, where money damages are in play.

But another impact militates for a reorientation of prosecution strategy. In industries such as semiconductors, where the US represents less than 10% of current manufacturing capacity, companies were developing their portfolios for enforcement at the International Trade Commission—or perhaps not at all.

If domestic production expands, it would open the possibility of enforcement in district courts and bring patents on the systems used for manufacture into play.

Takeaways

These changes may facilitate an increased role for patents in the innovation economy. If patents become easier to obtain and more difficult to challenge, companies may be more willing to assert their rights.

The high-tech space may feel the effects most strongly, as patents are already aggressively pursued in this industry, and the scope of potential enforcement actions in the US may be expanding.

High-tech companies should consider evaluating how these policy changes could impact the value of their patent portfolios or highlight gaps that need to be filled.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.

Author Information

Michael Zoppo is a principal at Fish focused on IP for financial services, high-tech, and life sciences companies.

Tom Rozylowicz is a principal at Fish focused on patent procurement and post-grant proceedings.

Evan Sumner is an associate at Fish focused on patent litigation for pharmaceuticals, biologics, and medical devices.

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