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Clear Forum Selection Clause May Avoid Patent Challenge

Careful language in a forum selection clause may help avoid patents from being invalidated. The U.S. Patent and Trademark Office (PTO) is, at the same time, the birthplace of all U.S. patents and their most prolific executioner. Patents regularly meet their demise in several PTO proceedings, including inter partes review (IPR), post grant review (PGR) and covered business method review (CBM). Licensors often include clauses in license agreements to restrict a licensee from filing reviews and challenging the patent. These provisions seldom were upheld. However, the federal circuit recently agreed that a forum selection clause prevented a PGR petition because the license clearly relegated disputes to California courts. The licensee has petitioned for rehearing, but, for now, pay close attention to forum selection clauses to avoid the PTO and better protect the validity of patents. Conversely, licensees should be wary to sign restrictive language that may limit the ability to challenge a patent at the PTO. Dodocase VR, Inc. v. MerchSource, LLC.

Royal W. Craig
410-576-4109 • rcraig@gfrlaw.com