Assessing Commercial Success at the U.S. Patent Trial and Appeal Board

Robert Vigil, Principal, Analysis Group, Inc., USA

U.S. patents increasingly are challenged on validity grounds through inter partes reviews at the U.S. Patent Trial and Appeal Board (“PTAB” or “board”). In fact, from September 2012 through June 30, 2015, there have been over 3,000 inter partes review (“IPR”) petitions filed by petitioners. Filings per month have increased from an average of 28 petitions in 2012 to 58 in 2013 to 125 in 2014 to 144 so far in 2015. Many patent owners raise a “commercial success” defense in response to such challenges. They argue that the success of products embodying the challenged patent proves that the patented invention must not have been obvious. Had the invention been obvious, the argument goes, the products embodying the patented invention would not have enjoyed the marketplace success that they, in fact, did. If the invention was obvious, someone else would have introduced a product incorporating the patented features earlier. Patent owners rarely have been successful at the PTAB in invoking this defense. In 82 final written decisions in IPR proceedings (through June 2015) that considered commercial success as a potential defense to patentability, the patent owner prevailed only twice. In all other cases, the patent owner failed in proving non-obviousness through a showing of commercial success.

Robert L. Vigil is a Principal of Analysis Group, Inc. Dr. Vigil specializes in the application of economics and finance to complex commercial litigation matters. His work includes the estimation of damages and unjust enrichment in intellectual property and breach of contract cases; the evaluation of patented drug products’ commercial success in connection with generic manufacturers’ Abbreviated New Drug Application submissions to obtain early market entry; and the analysis of issues related to the granting of permanent injunctions, such as irreparable harm and causal nexus. Dr. Vigil has also analyzed issues related to domestic industry, remedy, and bonding on cases before the International Trade Commission. He has served as an expert witness on litigation matters in a variety of industries, including pharmaceuticals, medical devices, consumer products, telecommunications, computer hardware and software, and electronics. In non-litigation matters, he has assisted clients in valuing intellectual property for sale or license; identifying and evaluating potential partners for licensing, acquisition, or divestiture of assets; and analyzing the impact of generic entry on prices and market shares of brand name pharmaceutical products. Vigil holds a B.A. (Pepperdine University) and a Ph.D. in Economics (University of Maryland).

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