Would anyone tolerate Federal judges being paid based on the number of cases they dispose of? Probably not—it looks bad and erodes faith in the system. With faith in the USPTO at a low point, why then does the USPTO compensate PTAB judges using a bonus system that appears biased? Judge Newman elegantly points out that the appearance of propriety is critical to build faith in any adjudicative process—including those at the PTAB.  

More on Sarah Guske and Eliot Williams, Baker Botts.

 

SPEAKERS

Sarah Guske, Wayne Stacy, Eliot Williams

 

Wayne Stacy  00:00

Welcome, everyone to the Berkeley Center for Law and Technology's Expert Series podcast. I'm your host, Wayne Stacey, the Executive Director of BCLT. And today we're talking about the USPTO. And a few issues that the next director might want to look into quickly. Two issues in particular, were recently raised by Judge Newman, the bias and appearance of bias and the director review ability of institution decisions. So both of these came up in a wonderful dissent written by Judge Newman in the mobility works case. To talk about these issues today. We have two experts from Baker Botts, Sarah Guske and Eliot Williams. Thank you both for joining us today.

 

Sarah Guske  00:41

Thanks for having us.

 

Eliot Williams  00:42

Good to be here, Wayne.

 

Wayne Stacy  00:43

So I want to talk about the the bias issue first, this case had a really interesting section in the majority opinion about how PTAB judges are bonused. And how bias may or may not arise from those bonuses. So Eliot, I wanted to kick it to you first, you want to give a little background on how PTAB judges are paid and why somebody might perceive a bias.

 

Eliot Williams  01:09

Yeah, this is definitely an interesting issue that comes out of out of this this opinion. And, you know, here the patent owner obtained some information through the Freedom of Information Act, although I think generally most practitioners knew this was how PTAB judges are paid. But essentially, the way they're evaluated, they're obviously several components that go into that. But one of them is sort of how many decisions they write. And for PTAB judges, those come in a couple from a couple different places. One is the institution decision, which I'm sure we'll talk more about in this conversation, which is kind of the beginning of an PTAB trial proceeding. And it's the first the first step in deciding whether the petitioner has made enough of a showing that patents may be invalid to sort of begin the trial. The second phase is in the final written decision, which is of course, the decision that comes at the very end of the trial. The third thing that PTAB judges can do, however, is to write decisions in ex parte appeals, which has nothing to do with these sort of IPRS and PTAB trials, but has to do with just regular prosecution coming up from the examiner core. And, so in this particular case, what the petitioner noted is, the patent owner should say noted is that because the PTAB judges are paid based on the number of decisions they write, or that goes into their bonus calculations, they have an incentive to institute, because they know that if they write the institution decision, they would then have the chance to get another, you know, piece of work product out at the end of the process when they write the final written decision. So that essentially, as I understand it, was the argument that was being made