January 13, 2020

USPTO Issues New Guidance “Clarifying” its 2013 Policy Statement on Availability of Injunction Relief and Exclusion Orders for SEPS

For those who attended our October webinar on standard essential patent (SEP) issues at the International Trade Commission (ITC), you may recall that, in 2013, the U.S. Patent and Trademark Office (PTO) and Department of Justice (DOJ) issued a policy statement relating to an SEP holder’s ability to seek an injunction for infringement of a F/RAND encumbered patent. According to that policy statement, the DOJ and PTO concluded that “the remedy of an injunction or exclusion order may be inconsistent with the public interest” and that “an exclusion order based on a F/RAND encumbered patent appears to be incompatible with the terms of a patent holder’s existing F/RAND licensing commitment to an SDO.” Although the DOJ had since altered its stance on the issue in favor of the “New Madison” approach, the PTO had remained relatively silent on the issue since 2013.

That changed on December 19, 2019, when the PTO expressly withdrew its 2013 policy statement. Instead, the PTO clarified in a new statement that, although a patent owner’s F/RAND commitment is a relevant factor in determining the appropriateness of any particular remedy, it “need not act as a bar to any particular remedy.” The PTO’s new guidance, purports to be based on “additional experience with disputes concerning standards-essential patents” and “concerns that the 2013 policy statement has been misinterpreted” to suggest “a unique set of legal rules” and/or that “injunctions and other exclusionary remedies should not be available in actions for infringement of standards-essential patents.” It also states that the 2013 statement may “have been misinterpreted to suggest that antitrust law is applicable to F/RAND disputes.”

The statement presents the view that all remedies “including injunctive relief and adequate damages” as well as “exclusion orders issued by the U.S. International Trade Commission” should be “equally available in patent litigation involving standards-essential patents.” The statement concludes by opining that “a balanced, fact-based analysis, taking into account all available remedies, will facilitate, and help preserve competition and incentives for innovation and for continued participation in voluntary, consensus-based, standards-setting activity.”

In the years following the 2013 guidance, accused infringers routinely availed themselves of the prior statements to argue that an injunction in the district courts or an exclusion order at the ITC was inappropriate in light of the SEP’s promise to grant a license on F/RAND terms. With this new guidance, the PTO clearly walks back from its earlier statements. This change will undoubtedly embolden SEP holders to take advantage of the ITC’s jurisdiction in particular, given the availability of injunctive relief as the main remedy,  to seek exclusion orders on F/RAND encumbered standard essential patents.