Benefits to the Ex Parte Reexam Requester:

• Requesters can file the Request anonymously. This can be very important when there are fears of retaliation or targeting among existing competitors. Anonymity can also be important for a potential competitor who wants to challenge a dominant patent before risking capital in new equipment that might be unnecessary if the patent is valid and the likelihood of a license is remote. Anonymity assures that an existing situation is not worsened. Indeed, some companies who are known to use a particular firm for their IP work have used a second IP firm for the reexamination as a further layer of anonymity.

• Reexamination does not have jurisdiction or standing requirements.
Anybody can request reexamination. Such a situation is valuable for Requesters who cannot sue or be sued in court, such as potential new manufacturers.

• Reexamination is generally less expensive than litigation.
The cost savings to a Requester is due to the assumption of spectator status after the initial Request. On average, an ex parte reexamination Request would typically cost no more than about $25,000 to prepare and file the Request. This is minimal compared to litigation: the 2001 AIPLA survey notes a national median cost of patent infringement litigation to be $300,000 to $1 million. Ex parte reexamination would cost about 1-5% that of a judicial proceeding and within the reach of even small competitors. This low barrier of challenge does not make Owners comfortable, but the defense of a challenge to validity by way of ex parte reexamination has corresponding low costs for the Owner with the possible gain of a strengthened patent.

• Because there is no discovery or opportunity for live testimony, reexamination proceedings are less intrusive for executives and research personnel.

• A continuing duty of disclosure under 37 C.F.R. ' 1.56 applies to the Owner but not the Requester.
This duty would require the Owner to come forward with any new evidence or information that might affect validity at the risk of rendering the patent unenforceable (regardless of validity) due to a failure to give the information to the examiner. There is no corresponding duty of disclosure on the Requester, who may even remain anonymous. The high stakes of nondisclosure are a significant matter for Owners.

• Once started, the reexamination process cannot be stopped
until a final decision is rendered. Settlement and licensing has no effect on the examiner’s duty to reach a final decision either for or against patentability of the claims. A fully prepared Request can be a powerful incentive to begin an advantageous licensing negotiation.

• There is no presumption of validity in reexamination.
See In re Etter, 756 F.2d 852, 225 USPQ 1 (Fed. Cir. 1985). The value of this lower standard can be a key factor in the resolution of doubts or ambiguities in the strength or teaching of a reference.

• Claims are given the broadest reasonable interpretation that is consistent with the specification
. (MPEP ' 2258(I)(G)). The examiner is not required to construe the claims in a manner that tries to preserve patentability unless the patent under reexamination is an expired patent during its six year period of enforceability. (Id.)

• New arguments presented by the Owner can introduce new prosecution history estoppel
and may force the Owner to choose among claim interpretation options that limit the claims. Omissions or misrepresentations to the examiner can be the basis for a defense of unenforceability based on inequitable conduct. In general, the more the patent owner says, the better are the chances that a defendant will find a defect in the file that may give rise to new defenses or find representations that may restrict the claims to a less favorable interpretation.

• Legislation in November 2002 [PL 107-273, 116 Stat. 1758, 1899-1906] overruled In re Portola Packaging, 110 F. 3d 786, 42 U.S.P.Q.2d 1295 (Fed. Cir. 1997) so that Requesters may rely on prior art that was originally cited during the original examination proceeding. A court will tend to give deference to the original examiner= s experienced interpretation of the patent until that original interpretation is proved to be wrong. In reexamination, however, examiners tend to review each reference de novo and without significant predisposition for the initial examination. The ability to rely on previously cited prior art without a presumption of patent validity or deference to the original examiner’s interpretation represent two significant advantages to the Requester that are not available to a defendant in court.

Drawbacks for the Ex Parte Reexam Requester:

• Apart from the initial Request, ex parte reexam does not allow the Requester any input into the examination proceeding or provide any right of appeal if the examiner determines that the claims are patentable. This "file-it-and-pray" posture requires that the Request has to anticipate and address issues that the Owner might raise. The lack of Requester input also means that there is nobody to correct the examiner if the technology or the meaning of a reference is misunderstood.

• The Requester has no opportunity to appeal or contest a decision for patentability.
In view of the potentially strengthened posture of a patent that emerges from the reexamination proceeding, the risks of misinterpretation or an understanding of how the technology interacts with the teachings of the prior art heighten the need for a thorough initial Request that fully anticipates all amendments and arguments for patentability.

• Because the Owner has the right to amend the claims to a narrower scope (and possibly broaden the claim scope if the reexam is filed within the two year window allowed for a broadening reissue), the Requester may be giving the Owner an opportunity to clean up a possible validity problem and strengthen the patent. The strengthened patent will emerge from the proceeding with a somewhat stronger presumption of validity by having faced the best prior art and been deemed patentable by the new examiner.

• The Owner can have an interview with the examiner
, the nature of which may not be completely recorded in the written summary placed in the file despite admonitions to do so. This may allow for a less complete record of the basis for the patentability decision. Alternatively, if the Owner files a summary of the interview, there exists the possibility that the interview summary may inadvertently include a somewhat slanted view of the details. There isn’t much the Requester can do to correct or fill in the patent prosecution record: the best art has been cited with the best arguments, but the examiner found a patentable invention anyway.

Despite the drawbacks and limitations, ex parte reexamination has gained a reputation as an important tool for patent challengers. The USPTO’s 21st Century Plan recognizes the value of the proceeding and has announced its intention to retain the ex parte reexamination proceeding.

Ex parte reexamination is not really a viable alternative to litigation. With no voice in the reexamination process, few litigation counsel would suggest that the client would be better served by a reexamination proceeding in which only the Owner can speak with the examiner. Thus, ex parte reexamination is best suited for Requesters who could not yet sue or be sued due to standing and jurisdictional requirements.

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