On May 8, 2018, the USPTO announced its proposed rulemaking for claim construction standard in PTAB proceedings. The PTO proposed to amend the rules to require the PTAB to interpret the claims in IPR/PGR/CBM proceedings using the same standard as applied in federal district courts and the USITC, and to consider any prior claim construction determination concerning a term of involved claim in a civil action or ITC proceeding that is timely made in the PTAB proceeding. The proposed changes would replace the BRI standard with the claim construction standard used in federal district courts and would be consistent with the PTO's current approach for interpreting claims in an expired patent. Full text of the notice is available here.
On April 26, 2018, USPTO issued guidance on the impact of the Supreme Court's decision in SAS Institute Inc. v. Iancu on AIA trial proceedings. According to the guidance, PTAB will proceed as follows: (1) it will institute as to all claims or none; if it institutes a trial, it will institute on all challenges raised in the petition; (2) for pending trials in which panel instituted trial on all challenges raised in the petition, panel will continue with the proceeding in normal course; (3) for pending trial in which a panel instituted trial only on some of the challenges raised in the petition, panel will issue a supplemental order on all challenges raised in the petition, and take action to manage trial proceeding including permitting additional time, briefing, discovery and/or oral argument, depending on the stage of the proceeding.
Full text is available here.
On April 24, 2018, the U.S. Supreme Court issued its decisions in two much-awaited patent cases involving inter partes review. In Oil States, in a 7-2 decision, the Court held that inter partes reviews were constitutional under the public-rights doctrine. Oil States Energy Svcs., LLC v. Greene's Energy Group, LLC, 584 U.S. ___ (2018). In SAS, in a 5-4 decision, the Court held that the PTAB must decide the patentability of all the claims the petitioner has challenged in an inter partes review. SAS Inst. Inc. v. Iancu, 584 U.S. ___ (2018).
Oil States Energy Svcs., LLC v. Greene's Energy Group, LLC
In Oil States, petitioner Oil States Energy Services, LLC obtained a patent relating to technology for protecting wellhead equipment used in hydraulic fracturing. Oil States sued Greene's Energy Group, LLC for infringement and Greene's Energy challenged the validity in district court and also filed an IPR petition. The district court issued a claim construction order favoring Oil States while the PTAB concluded that the patented claims were invalid. Oil States appealed to the Federal Circuit challenging the PTAB decision and the constitutionality of IPR. While the appeal was pending, the Federal Circuit rejected the constitutionality of IPR in a separate case and summarily affirmed the PTAB's decision involving Oil States.
On appeal, the U.S. Supreme Court held that the inter partes review does not violate Article III. Writing for the majority, Justice Thomas reasoned that IPR falls squarely within the public-rights doctrine and that patents are "public franchises." According to the Court, IPR involves the same basic matter as the grant of a patent subject to the Board's authority and that the Court has recognized that franchises can be qualified in this manner. Addressing the petitioner's arguments, the Court found that the three decision recognizing patent rights are private property were decided under a different statutory scheme, historical practice where courts have adjudicated patent validity does not foreclose Congress from assigning matters governed by public-rights doctrine to the Executive, and that the similarities between the various procedures used in IPR and in courts does not lead to the conclusion that IPR violates Article III. The Court went on to to say that the holding is narrow and does not address whether patents are property for the purposes of Due Process Clause or the Takings Clause.
In his dissent, Justice Gorsuch joined by Chief Justice Roberts, stated that the decision signaled a retreat from Article III's guarantees that "suits at the common law, or in equity, or admiralty" must be heard by independent judges.
Full text of the Oil States opinion is available here.
SAS Institute Inc. v. Iancu
In SAS, petitioner SAS Institute sought an inter partes review of ComplementSoft's software patent alleging that all 16 of the claims were unpatentable. The Director instituted review of only claims 1 and 3-10 and denied review on the rest. At the end of litigaton, PTAB issued a final written decision finding claims 1, 3 and 5-10 to be unpatentable while upholding claim 4. PTAB's decision did not address the remaining claims on which the Director had refused review. SAS appealed to the Federal Circuit which affirmed the Board's decision and dismissed SAS's argument that 35 USC 318(a) required the Board to decide the patentability of every challenged claim in the petition. SAS filed a writ of certiorari.
On appeal, the U.S. Supreme Court, in a 5-4 decision, held that the Patent Office must decide the patentability of all of the claims the petitioner has challenged in an IPR instituted by the PTAB.
Full text of the SAS opinion is available here.
On Jan. 11, 2018, the PTAB designated two decisions as informative involving 35 USC 315(b). Luv N' Care, Ltd. v. McGinley, IPR2017-01216 (PTAB Sept. 18, 2017) (Paper 13), Amneal Pharm., LLC v. Endo Pharm., Inc., IPR2014-00360 (PTAB June 27, 2014) (Paper 15). In Luv N' Care, the Board denied institution because payment was not received until after the date the petition was filed and the petitioner failed to show good cause for waiving the fee requirement. In Amneal Pharma, the Board determined that the petition was timely filed under 35 USC 315(b) because filing a motion to amend the complaint in district court, with an amended complaint attached, does not constitute service.
Full text of the decisions are available here.
On Jan. 8, 2018, the en banc court of the Federal Circuit held that the time-bar determinations under 35 USC 315(b) are appealable and overruled the court's 2015 ruling in Achates. Wi-Fi One, LLC v. Broadcom Corp., Nos. 2015-1944, -1945, -1946 (Fed. Cir. Jan. 8, 2018) (en banc) According to the Court, there was no clear and convincing indication of congressional intent barring judicial review of USPTO's action denying institution of inter partes review that are filed more than one year after the petitioner is served with a complaint for patent infringement.
Full text of the opinion is available here.
On Nov. 16, 2017, the USPTO issued new procedures for cases remanded from the Federal Circuit. The Standard Operating Procedure (SOP) provides guidance for panels in preparing for remand meetings and guidance to parties on remand procedures. The potential topics for such remand meetings may include the procedural history, issues on remand, any contemplated procedures for the proceedings on remand, and policy considerations. The SOP suggests parties in remanded trial cases are to contact the Board within 10 days and encourages parties to seek agreement on, among others, additional briefing, length of briefing, subject matter limitations on briefing, and briefing schedule. Full text is available here.
On October 24, 2017, the PTAB designated three opinions that address 35 USC 325(d) as informative opinions. See Unified Patents, Inc. v. Berman, IPR2016-01571 (PTAB Dec. 14, 2016) (Paper 10); Hospira, Inc. v. Genentech, Inc., IPR2017-00739 (PTAB July 27, 2017) (Paper 16); Cultec, Inc. v. Stormtech LLC, IPR2017-00777 (PTAB Aug. 22, 2017) (Paper 7). In Unified Patents, the Board denied institution because the petitioner asserted an obviousness combination that included a reference the examiner considered during prosecution and a second reference that was cumulative prior art. In Hospira, the Board denied institution because the examiner considered during prosecution the same arguments the petitioner raised regarding patent owner's claim to priority and examiner's determination was dispositive as to asserted grounds of unpatentability. In Cultec, the Board denied institution because (i) the examiner previously considered two of the asserted references; and (ii) two additional references relied upon were cumulative of prior art. Full text is available here.
USPTO released the PTAB statistics end of July 2017. The data reveals that a total of 7,306 petitions were filed under AIA and 92% of those petitions were IPRs. A total of 1,650 petitions were filed thus far this year and the majority of those petitions were in electrical/computer (60%), and mechanical and business methods (21%). Institution of the petitions was at an all time low of 63% with the highest rate of institution in the art area of mechanical and business methods (70%), closely followed by electrical/computer arts (69%). Fourteen percent (14%) of the petitions settled prior to institution and twenty-three percent (23%) after institution. In the 1,674 final written decisions, 65% of all instituted claims were found to be unpatentable.
Detailed report is available here.
On September 18, 2017, the PTAB designated an expanded panel's decision on follow-on petitions as informative. General Plastic Indus. Co., Ltd. v. Canon Kabushiki Kaisha, IPR2016-01357 (PTAB Sept. 6, 2017) (Paper 19). In this case, General Plastic filed a first set of five petitions seeking IPR of two patents and each of the petitions were denied. Petitioner filed follow-on petitions against the same patents and PTAB denied institution based on 35 USC 314(a). Petitioner sought rehearing arguing that the follow-on petitions aren't limited to one petition per challenged patent under 35 USC 311 or 314; follow-on petitions should be analyzed under 35 USC 325(d) instead of 314(a); and that the PTAB misapplied the Nvidia decision.
In Nvidia, the Board enumerated the following factors that it considers when exercising its discretion to denying institution of an IPR: (1) whether the same petitioner previously filed a petition directed to the same claims of the same patent; (2) whether at the time of filing of the first petition the petitioner knew of the prior art asserted in the second petition or should have known of it; (3) whether at the time of filing of the second petition the petitioner already received the patent owner's preliminary response to the first petition or received the Board's decision on whether to institute review in the first petition; (4) the length of time that elapsed between the time the petitioner learned of the prior art asserted in the second petition and the filing of the second petition; (5) whether the petitioner provides adequate explanation for the time elapsed between the filings of multiple petitions directed to the same claims of the same patent; (6) the finite resources of the Board; and (7) the requirement under 35 USC 316(a)(1) to issue a final determination not later than 1 year after the date on which the Director notices institution of review. Nvidia Corp. v. Samsung Elec. Co., IPR2016-00134 (PTAB May 4, 2016). Applying these factors, the follow-on petitions were denied.
In its request for rehearing, the Petitioner argued the following: (a) Board ignored the overarching purpose of Section 6 of AIA; (b) Section 325(d) recognizes possibility of subsequent petitions; (c) section 325(d) controls over the more general statutory section 314(a); (d) denial of first-filed petition shouldn't be fatal where follow-on petitions attempt to cure a substantive and material defect in the first-filed; (e) Nvidia doesn't include a factor addressing patent owner's resources and PTAB erred in considering it. In finding the Petitioner's arguments as not persuasive, the expanded panel upheld the denial of follow-on petitions finding that the multiple, staggered petition filings were an inefficient use of the IPR process and the Board's resources, that six of the seven Nvidia factors weighed against institution, and that Petitioner failed to explain why a reasonably diligent search couldn't have uncovered the newly applied prior art or whether there were any changed circumstances that reasonably justified its new prior art searches and associated filing of follow-on petitions.
The PTAB designated its decision in Athena Automation Ltd. v. Husky Injection Moldings Systems Ltd., IPR2013-00290, Paper No. 18 (Oct. 25, 2013) as precedential. Announcing the designation, the PTO states that the "decision determines that the doctrine of assignor estoppel is not an exception to 35 USC 311(a), which allows 'a person who is not the owner of a patent' to file a petition for inter partes review."
Other IPR or CBM decisions that have been designated precedential thus far are:
Garmin Int'l, Inc. v. Cuozzo Speed Techs LLC, IPR2012-00001 (Mar. 5, 2013)
Oracle Corp. v. Click-to-Call Techs LP, IPR2013-00312 (Oct. 30, 2013)
MasterImage 3D, Inc. v. RealD Inc., IPR2015-00040 (July 15, 2015)
Lumentum Holdings, Inc. v. Capella Photonics, Inc., IPR2015-00739 (Mar. 4, 2016)
LG Electronics, Inc. v. Mondis Tech Ltd., IPR2015-00937 (Sept. 17, 2015)
Westlake Services, LLC v. Credit Acceptance Corp., IPR2014-00176 (May 14, 2015)
Bloomberg Inc. v. Markets-Alert Pty Ltd., CBM2013-00005 (May 29, 2013)
SecureBuy LLC v. CardinalCommerce Corp., CBM2014-00035 (Apr. 25, 2014)
Disclaimer: The content in this blog is solely for informational purposes and does not constitute legal advice.