What To Expect From The PTAB In 2023: Unpatentability Rates – Patent

This alert’s key takeaways include:

• The Patent Trial & Appeal Board (PTAB) has held
  unpatentable 70% or higher of the claims that it addressed in a
  final written decision over the last four years;




• This rate is not comforting for patent owners who if
  instituted, should explore alternative resolutions to avoid a final
  written decision; and




• Based on the historical trend and the present climate at the
  PTAB, which includes climbing institution rates, we expect the high
  rate of unpatentability at final written decision to continue in
  2023.

When you are embroiled in a contentious battle with your
competitor in aninter partesreview (IPR) proceeding, what
is your ultimate goal? To win, of course. But what are your odds of
success? This alert delves into the win rates for both patent
owners and patent challengers over the last four years at the PTAB
and provides predictions for what to expect in 2023.

Often, legal commentators are too focused on the PTAB’s
fluctuating institution rate. But once a proceeding is instituted
and a trial goes to completion, what ultimately matters is the rate
at which the PTAB finds claims unpatentable in a final written
decision.

This unpatentability rate can be calculated from the raw data
provided by the PTAB in its End of Year Outcome Roundup. We
crunched the numbers for you and found a staggering statistic: the
PTAB has held unpatentable 70% or higher of the claims it addresses
in a final written decision. The following chart shows the
PTAB’s unpatentability rate at final written decision in each
of the last four years.

This means that for every 10 claims the PTAB considers at final
written decision, 7 or more will likely be held unpatentable.

Now, analyzing the raw numbers in a slightly different manner on
a per patent basis, 60% of patents that have reached a final
written decision over the last four years have had every
challenged claim held unpatentable. This number was the highest in
2022 at 66%, or 2 out of every 3 patents did not have a single
claim at issue be patentable. While on the other side of the
spectrum, only 19% of patents over the last four years have escaped
a final written decision unscathed.

These are not comforting numbers for patent owners. The critical
takeaway for patent owners is that the best way to avoid an
unpatentability holding by the PTAB is to avoid an institution in
the first place. Patent owners should expend maximum effort to
defeat an IPR challenge at the institution stage if at all
possible. But if that fails and a petition is instituted, then a
patent owner needs to at least reevaluate its position and more
heavily consider alternative resolutions to avoid a final written
decision.

Consequently, these are attractive numbers for patent
challengers. The key takeaway for patent challengers is that if
they overcome the hurdle of institution, there is a good chance of
achieving an unpatentability holding for the overwhelming majority
of the claims at issue. This likely gives the patent challenger
significant leverage over the patent owner with respect to any
resolution opportunities because a patent owner may be more
motivated to settle the dispute after an institution to avoid the
PTAB’s 70% (or higher) unpatentability rate.

Another trend is apparent from the data. The unpatentability
rate remains mostly steady from year to year. Indeed, although the
recent unpatentability rate is a bit lower than the historical
unpatentability rate from 2011-2019 (77% according to the PTAB),
the recent and historical rates are not too far off from one
another.

Looking ahead to 2023, what do we predict from the PTAB
regarding its unpatentability rate? More of the same. Based on the
historical trend and the present climate at the PTAB, which
includes climbing institution rates as the rate of discretionary
denials decreases, we expect that the PTAB’s unpatentability
rate will remain in the 70% (or higher) range in 2023. We invite
you to contact us to further discuss these trends and how we may be
able to help leverage them for your business.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.