Opinions and Editorials

Aug. 10, 2020

IP Watchdog: The Covered Business Methods Program Must Finally Be Laid to Rest by James Edwards

Rather than allowing it a quiet death, the financial services industry is making a quiet effort to keep the Covered Business Methods (CBM) Program at the Patent Trial and Appeal Board (PTAB) alive.

The special interest group has reportedly enlisted Senator Richard Blumenthal (D-CT) to push for an extension of the CBM program for one year. A rider on the next COVID supplemental appropriations package, or possibly a FY 2021 Commerce Department appropriations bill, would carry the grant of CBM’s stay of expiration.

A Political Fix That Should Not be Prolonged

CBM is one of three administrative adjudicatory proceedings at the PTAB. The 2011 America Invents Act created the PTAB and its tripartite means of administratively pursuing invalidation of issued patents, for the first time denying patent owners de novo review by and the superiority of Article III federal courts. Inter partes review is the most-used proceeding at the PTAB, while post grant proceedings are second-most used.

Referred to in the AIA as a “transitional” program, CBM is scheduled to expire permanently on September 16, 2020. The program was created as a political fix for ulterior purposes directly benefitting the financial services industry.

Plenty of opposition to extending CBM’s life exists. CBM was roundly decried during the AIA debate. Its opponents — many then and more now — include inventors, entrepreneurs, intellectual property organizations such as the Licensing Executives Society (USA & Canada) and the Small Business Technology Council, conservative and free-market organizations, and innovative business groups, including the Innovation Alliance, the National Small Business Association and U.S. Business & Industry Council.