What You Need To Know About Amazon’s Utility Patent Neutral Evaluation Procedure
Amazon launched the Neutral Patent Evaluation Procedure in early 2019 with the purpose of resolving disputes between patent holders and those who are accused (sometimes wrongfully) of infringement on the marketplace. Our Amazon Seller IP lawyer addresses what you need to know about this process if you become involved in an infringement dispute.
Amazon’s Utility Patent Neutral Evaluation Procedure Initiation
It is important to note that the process may only be initiated by a party that holds a valid utility patent. The patent owner must submit a written request to Amazon by completing the Amazon Utility Patent Neutral Evaluation Agreement. Among other things, the patent owner must provide via the agreement:
- The patent owner’s name and address
- The names of any corporate parents, subsidiaries, or other related entities
- The U.S. utility patent number of the patent at issue
- The Amazon Standard Identification Number (ASIN) of the Accused Product(s)
Seller’s Response to Initiation of Amazon’s Utility Patent Neutral Evaluation Procedure
If an accused seller, or their Amazon Seller IP lawyer, fails to respond within three weeks, then the patent owner “wins” the proceeding. In other words, the allegedly-infringing listing is removed as a result. To respond to and refute an accusation of infringement in a timely matter, the accused seller must also complete and submit the Amazon Utility Patent Neutral Evaluation Agreement.
Appointment of Neutral Evaluator
Once a patent owner and accused seller (or sellers) submit their paperwork, Amazon will select a qualified patent attorney to serve as the neutral evaluator for the process. Each party must submit a $4,000 deposit to be held in escrow by the evaluator, pending the outcome of the proceeding. If the accused seller does not pay the fee, then the product listing(s) at issue will be removed.
Length of the Amazon Utility Patent Neutral Evaluation Procedure
After both parties pay the fees, the evaluator then establishes a 2 to 3-month schedule for the process, in which strict deadlines are set. Requests to modify the schedule are not permitted, and failure to meet a deadline can result in forfeiture of the case and the party’s $4,000 deposit.
Evidence Considered By The Neutral Evaluator
The evaluator will not consider any oral testimony from any party or their Amazon Seller IP lawyer. They will, however, consider photographs and charts in addition to the written arguments and responses. Discovery, depositions, and physical evidence are not allowed to be submitted for consideration.
The seller may only use the following defenses:
- A previous ruling by the court that the patent is invalid
- The goods in question were on sale for more than a year proper to the patent effective date
After considering the arguments and evidence, the evaluator will issue his or her ruling. The evaluator will make one of the following findings:
- The product likely infringes the asserted patent; or
- The asserted patent likely does not cover the product or is likely invalid
The prevailing party is then refunded its $4,000 fee. The evaluator retains a maximum of $4,000 as compensation. Any excess amount paid by sellers may be awarded to an Amazon Smile charity of the patent owner’s choosing if the patent owner prevails. Amazon will generally remove a listing within 10 business days after a decision is handed down against a seller. Amazon may restore a listing if a subsequent judgment or order from a litigation or arbitration proceeding is submitted.
A Note About Amazon’s New Patent Evaluation Express Program (APEX)
The Amazon Patent Evaluation Express Program (APEX) is the company’s newest, fastest and least expensive way for utility patent owners in the United States to resolve disputes on Amazon’s US platform. Similar to the company’s previous UPNEP program, APEX uses a third-party attorney to analyze and determine whether patent infringement has occurred. The upside to using the program is that those who participate typically receive decisions within two months, as opposed to waiting on an outcome from patent litigation, which can take several years to resolve.
Consult With An Amazon Seller IP Lawyer at ESQgo
If you are a patent holder or you have been accused of utility patent infringement, an Amazon Seller IP lawyer at our firm is here to provide the guidance you need regarding Amazon’s Utility Neutral Evaluation Procedure. Schedule a consultation with our firm so we can discuss the options available to you.