Richard Lloyd

If there is one area of patent reform where most US legislators seem able to agree, it’s that the Patent Trial and Appeal Board’s (PTAB) use of the broadest reasonable claim interpretation standard in interpreting patent claims should be abandoned. The Innovation Act contains a provision to shift PTAB re-exam proceedings to the standard used at district court level, as does the STRONG Patents Act, the bill which has been introduced in the Senate.

Given the consensus that is building around a reworking it might be safe to assume that any legislation that does eventually emerge from Congress will include a change. This, of course, is being closely watched because of the runaway popularity of inter partes reviews. Big tech companies, in particular, have shown a real enthusiasm for them.

Now hedge fund investor Kyle Bass, who has earned a high degree of notoriety for launching IPR challenges to life sciences patents, has waded into the debate. In a letter to the leadership of the House of Representatives’ Judiciary Committee, as it held its latest hearing on the Innovation Act, Bass made plain his opposition to changing the standard, claiming to do so would be “premature and harmful”.

He went on to explain the reasons for his opposition: “If during the patent application process patent owners choose not to narrowly define key patent claim terms-why should they benefit from a narrow construction of claim terms that would salvage validity during an IPR when they chose to leave vague claim terms undefined during prosecution? The “vagueness” of patents is very much a problem created by the patent owner.”

As Bass is using the IPR process and profiting by shorting the stock of the pharma companies that he’s challenging, his thoughts would fall into the category of “well he would say that, wouldn’t he?”; but his comments offer an interesting counter-point to the case for change.

In the most recent issue of IAM Google’s Tim Porter, who is in charge of the company’s internal patenting efforts, explained why the IPR process has proved so popular with large parts of the tech community. “A process like inter partes review is a good way of giving companies and members of the public the ability to test the realms of a patent without having to get sued to do it,” he explained.

In his letter Bass also included a comment from Jason Piché, Medtronic’s patent counsel for spinal and biologics, who said that as a result of challenges to pharma patents “the drafting of obtuse patents will go away, which is a good thing”.

In bringing his anti-pharma IPRs Bass has been working in conjunction with former IPNav CEO Erich Spangenberg. Although Bass is the only signatory on the letter to Judiciary Committee Chairman Bob Goodlatte and Ranking Member John Conyers Jr, it would be surprising if Spangenberg had not played an active role in helping to craft his arguments.

If that is the case, we’re left with the rather intriguing prospect of Spangenberg, who perhaps more than anyone has pioneered the kind of monetisation tactics that have big tech companies and countless advocacy groups spluttering “troll”, now lining up alongside parts of Silicon Valley as one of the IPR process’s staunchest defenders. If anyone saw that one coming perhaps they would do me a favour and let me know who’s going to win the next World Series.