Is SCOTUS action a final curtain for alleged patent troll?

On behalf of Kaufhold & Dix Patent Law posted in Patent Law on Thursday, May 24, 2018.

Inter partes review is safe and sound. We reported on this development in our last post. In two recent decisions, the U.S. Supreme Court declared IPR constitutional on one hand. On the other hand, it took the U.S. Patent and Trademark Office to task being too arbitrary in the way it sometimes chose to exercise the IPR power it wields.

This week, we examine a decision by the high court to not hear another case challenging the IPR process and explore the implications that holds for protecting the creative output called podcasts.

As we observed in the previous post, the inter partes review is an administrative process the USPTO instituted to facilitate challenges to already issued patents. One of the big benefits of the system, according to proponents, is that it can take the legal wind out of the sails of patent trolls – entities who hold patents and use the threat of lawsuits to leverage money out of alleged infringers. Defendants in such cases often settle rather than face a costly court battle. Many see IPR as a less expensive way to fight back.

This is where the third recent Supreme Court decision comes into play. On May 14, the court refused to hear a petition for certiorari from Personal Audio LLC, a Texas company that claims a patent for a “system for disseminating media content” in serialized episodes over the internet. The company says podcasts fall into this category. Challengers claim Personal Audio is just another troll.

The history of the case goes like this. Back in 2013, Personal Audio was engaged in infringement claims against a number of podcasters when the Electronic Frontier Foundation went to the USPTO and challenged the relevant patent before through IPR. EFF won, and an appeals court later affirmed the decision, invalidating Personal Audio’s patent claims.

Personal Audio appealed to the Supreme Court claiming the IPR to be unconstitutional, but the justices refused to hear the case. With that inaction, EFF and others say Personal Audio’s claims of a podcast patent are dead.

It might be useful here to point out that, patent issues aside, copyright law still provides podcast creators with protection rights.