ExtractionTek Stainless (ETS), which said it's the ﬁrst cannabis extraction manufacturer to use only domestic steel in its closed-loop machinery, has instituted one of three inter partes review (IPRs) petition filings with the Patent Trial and Appeal Board (PTAB) at the United States Patent and Trademark Office.
The company said the move is based on a reasonable likelihood that at least one of the claims challenged in the IPR petition is unpatentable. The institution of the ﬁrst IPR starts a one-year clock for the PTAB to evaluate the claims in the patent in question and either confirm their validity or invalidate the claims and possibly the entire patent.
ETS said it filed the IPRs to sell their closed-loop extraction equipment to customers without fear of so-called “patent troll” retribution.
Halo Collective, an ETS client, has already had its subsidiaries Coastal Harvest and ANM subjected to a patent infringement lawsuit from Gene Pool Technologies ﬁled August 2021.
In its complaint, Gene Pool said it spent months attempting to engage Halo in good-faith licensing discussions regarding its patent portfolio. “Unfortunately, given Halo’s decision to ignore evidence of its past and continued infringement of Gene Pool’s patents, we must now vigorously defend our patent rights, and those of the inventors we work with, in order to support the establishment of a fair and equitable culture of IP rights which enable innovation in the medical and recreational cannabis industries," said Gene Pool CEO Stephen Martin.
ETS CEO Matthew Ellis clarified that his company is not being sued, but that it took action to protect its clients.
"...We can only imagine how many smaller companies are subject to these kinds of threats. Our client Halo has been challenged with two suits, and we felt we needed to wade into this situation in order to stop capricious and cynical actions like this from becoming the norm. We’re alarmed to learn of a Santa Clara University study ﬁnding that 61% of patent lawsuits are brought by such patent assertion entities as Gene Pool; that number was only 16% in 2006. Someone has to stand up to them, and this time that someone is us," he said.
ETS said it has so far has spent over $250,000 defending Gene Pool’s litigation. The ﬁrst IPR has been instituted and ETS expects the other two IPRs will be instituted as well.
“Patent assertion entities frame their aggression as an opportunity to do business with them, effectively suggesting that you can license patents if you give them their shakedown money,” said Ellis. “We can’t let that happen.”