Sep 03

Don’t Count on Avoiding a Redundancy Finding by Filing Multiple IPR Petitions

36457258_sFrom the very outset of inter partes review proceedings, the Board has helped to manage its docket by rejecting challenge grounds in petitions that are redundant to other grounds in the petition. See Liberty Mutual Ins. Co. v. Progressive Casualty Ins. Co., CBM2012-00003 (explaining vertical and horizontal redundancy). As a strategy to avoid this type of redundancy finding, Petitioners began to file multiple petitions directed to the same patent, hoping that by paying an extra $23,000+ filing fee, the Board would consider additional grounds against the same patent. That strategy is facing headwinds, however, as demonstrated in the case of LG Elec., Inc. v. ATI Techs., ULCIPR2015-00327, Paper 15 (Sept. 2, 2015) (denying request for rehearing). In that case, the Board (once again) denied a petition relying in part on 35 U.S.C. § 325(d), finding that the overlapping of arguments between two related petitions, and the institution of an IPR of the same claims in the related case, warranted a denial of the petition.

Of the reasons given by the Board for its decision, the one factor that might have tipped the Board’s decision in Petitioner’s favor relates to the purported overlap between the primary references cited in each of the two petitions at issue. If Petitioner had provided some rationale regarding why the primary references do not disclose substantially the same subject matter, the decision might have come out differently. And, of course, if the references really did disclose the same subject matter, a second petition was likely not necessary in the first place.

Regardless, a denial of a decision to institute is non-appealable, so this type of decision by the Board is, effectively, immune from challenge. 35 U.S.C. § 314(d).

Aug 31

PTAB Finds Copyright Notice is Inadmissible Hearsay – Denies Petition for IPR

6686163_sDifferent panels of the Patent Trial and Appeal Board have, for the most part, agreed with each other on many of the key issues that arise in inter partes review proceedings. There are, however, instances of disagreement and an example of this type of disagreement arose in ServiceNow, Inc. v. Hewlett-Packard, Inc., IPR2015-00707, wherein this particular panel of PTAB judges decided that a copyright notice on a prior art reference did not suffice to establish that the reference was publicly available as of the date of the notice.

The prior art at issue included the date “July 2001″ on their face and also included a copyright date of “2001.” The Board agreed with Patent Owner that the indications of the availability of the references is inadmissible hearsay to the extent Petitioner relies on the date for the truth of that information. Order at 16. Notable in the Board’s analysis was the fact that the references included a statement that restricted the use and dissemination of the references.

The Board noted that at least one other panel agreed that a copyright notice as evidence that a reference was a printed publication as of a particular date is inadmissible hearsay. Standard Innovation Corp. v. Lelo, Inc., IPR201400148, Paper 41, at 13-16. The Board also noted, however, that other panels have determined that a copyright notice is prima facie evidence of publication. Ford Motor Co. v. Cruise Control Techs. LLC, IPR2014-00291, Paper 44, at 7-8; FLIR Sys., Inc. v. Leak Surveys, Inc., IPR2014-00411, Paper 9, at 18-19.

Ultimately, on the basis of the facts mentioned above, the Board decided that Petitioner had failed to establish that the exhibits at issue were publicly available more than one year prior to the priority date of the patent-at-issue. Order at 17.

 

Aug 25

First One Gets Away from Bass-Backed Group

3119029_sMany in the pharmaceutical industry have been concerned about becoming a target of the Coalition for Affordable Drugs, the group backed by hedge fund manager Kyle Bass.  But yesterday the first target of Bass’s strategy, Acorda Therapeutics, scored a big win when the PTAB declined to institute review in the first two IPRs filed by Bass’s group.

In February Bass’s group filed IPR petitions against two Acorda patents, 8,007,826 and 8,663,685.  Both are listed in the Orange Book for Acorda’s Ampyra tablets used to treat walking difficulty in patients with MS; they are the last-expiring patents listed for that product.

The Board found that both petitions failed to established that the relied-upon art was in fact prior art.  In each IPR petition, the Coalition relied on two poster presentations, one from a conference in September/October 2001, and another from a conference in September 2002.  Each was before the priority date, but the Board agreed with Acorda that neither was established as a “printed publication.”  Because the Coalition did not show that the posters were distributed (rather than presented) or otherwise indexed, the Board considered the factors from In re Klopfenstein, 380 F.3d 1345, 1349 n.4 (Fed. Cir. 2004) to determine whether the presentations nonetheless qualified.  Those factors are:  [1] the length of time the display was exhibited, [2] the expertise of the target audience, [3] the existence (or lack thereof) of reasonable expectations that the material displayed would not be copied, and [4] the simplicity or ease with which the material displayed could have been copied.  According to the Board, the Petitioner failed to make a sufficient showing that these factors were met.

So, the first decisions in the Bass-filed applications did not succeed, but it may not matter. If the speculation is correct, the Coalition already made its money in the stock market.

Aug 24

Board Dismisses Petition for Failure Name All Real Parties-In-Interest

14409517_s (1)Patent Owners get frustrated when they believe a petition fails to identify all real parties-in-interest.  This is understandable, given the difficulties in obtaining additional discovery on the issue.  However, sometimes Patent Owners get that discovery, and when a Patent Owner does get the evidence it needs, it has a kill shot.  This is again reflected in Corning Optical Comm’ns RF, LLC v. PPC Broadband, Inc., IPRs2014-00440, -00441, and 00736.

There, the Board instituted review of three patents.  The petitions were filed less than a year after a lawsuit was service against Petitioner.  Patent Owner’s argument, though, was that the petition was not entitled to the original filing date because not all real parties-in-interest were named.  Rather, Patent Owner argued, a new filing date would be set only upon submission of updated mandatory notices.  Because the one-year deadline (from service of the complaint) had passed, that would mean that the petitions would be barred under § 315(b).

After institution, the Board authorized a motion for additional discovery directed to whether the Petitioner (Corning) should have identified its parent (Corning Inc.) and sister (Corning Optical Comm. LLC) companies.  The issue was whether those companies funded or controlled the IPRs.  The Board first addressed the issue of whether Patent Owner waited too long in raising the issue.  The Board decided that Patent Owner’s argument was timely, because Patent Owner only gained notice of the issue shortly before alerting the Board, based on discovery in an underlying ITC investigation.  As to the substance of the issue, the Board noted the highly fact-specific nature of the real-party-in-interest analysis.  Here, there was evidence of commingling between the three Corning entities, including because common employees of each were involved in the IPR and because Corning Inc. payed the attorneys’ fees.  As the result, the Board found that “Petitioner’s actions have blurred sufficiently the lines of corporate separation” with Corning NC, such that Corning NC ‘could have controlled the filing and participation of the IPRs.’ Zoll, Case IPR2013-00606, slip op. at 10 (Paper 13). Furthermore, we determine that evidence sufficiently establishes that Corning Inc. funded these IPR proceedings, and also exercised or could have exercised control over Petitioner’s  participation in these proceedings. Trial Practice Guide, 77 Fed. Reg. at 48,759–60; Atlanta Gas,  Case IPR2013-00453, slip op. at 8–9 (Paper 88).”

The Board then determined that the petitions could not be afforded their original filing date because of the failure to name all real parties-in-interest.  Because it was then a year past service of the complaint, any new filing date would result in a bar under § 315(b).  The Board thus dismissed the petitions.

Aug 21

PTAB Generously Expands Page Limits in Patent Owner Response

41185418_sThe Board has earned a reputation for rigidly following the procedural rules for IPR proceedings, for good reason. Early on, the Board was likely concerned that an ad hoc web of decisions that granted relief from the variety of rules that govern IPR would create an unwieldly body of decisions. As IPR approaches its 3-year old birthday, however, there are ever growing signs that the Board is willing to consider deviations from core procedural rules, in the right circumstances. For example, in Daicci Sankyo Co., Ltd., v. Alethia Biotherapeutics, Inc., IPR2015-00291, the Board granted Patent Owner’s request for 25 additional pages to argue the prior art status of certain references relied upon by Petitioner. Order at 3. Finding that the particular facts of the case favored an exception to the rules, the Board granted Patent Owner an additional 25 pages “to be used solely for the purposes of addressing the prior art status of references relied on by Petitioner based on prior conception plus reasonable diligence and/or prior actual reduction to practice.” Id. Similarly, Petitioner was granted an additional 12 pages to its reply brief to respond to these arguments.

Also interesting in this decision is the Board’s recitation of what should be addressed relative to this conception issues. Specifically, Patent Owner was instructed to present a “diligence chart” that includes: “1) list all days from the beginning of diligence through the end of diligence, 2) briefly state what happened on each day, and 3) cite the page and line of the motion on which the listed day is discussed; every date gap in the diligence showing must be explained…” Order at 4.

So, the Board demonstrates some leniency in the procedural rules, and also provides interesting guidance regarding what should be provided to the Board to prove diligence.

Aug 19

USPTO Announces Second Set of IPR Changes

USPTOToday, USPTO Director, Michelle Lee, explained the anticipated, second set of proposed changes to be made to IPR proceedings as inter partes review approaches its 3rd birthday. The first set of changes was discussed HERE. We set forth below a brief summary of the changes that have arrived. The proposed rule package will now be subject to a round of comments (due before October 19, 2015).

  1. In general, the Board shied away from adopting bright-line rules, and instead focused on the need for considering issues on a case-by-case basis.  Highlights of the new regulations include:

 

  • The Board will continue to apply the broadest reasonable interpretation standard for claim construction of unexpired claims, rather than the Phillips standard;
  • However, the Board will apply Phillips-type claim construction to claims what will expire before a final written decision;
  • Concerning motions to amend, the Office confirmed that the patent owner must show patentability of substitute claims over the prior art of record (including art provided in light of the patent owner’s duty of candor);
  • Patent Owners will be allowed to file testimonial evidence with its preliminary response, but there will be no depositions until trial is instituted, and, for purposes of deciding whether to institute trial, factual disputes will be resolved in favor of petitioner;
  • Regarding additional discovery, the Board will continue to apply the Garmin factors, subject to additional guidance reflected at http://www.uspto.gov/blog/aia/entry/message_from_administrative_patent_judges. The Board’s discussion of this issue implicitly forecasts more flexibility from the Board in applying these factors going forward;
  • Concerning the specific issue of additional discovery geared towards Patent Owner’s attempt to develop evidence concerning secondary considerations (e.g., regarding sales of Petitioner’s product), the Board maintains that the Garmin factors are applicable, but did give the Patent Owners the concession that an absolute showing of nexus is not required to obtain additional discovery;
  • Patent Owners will be allowed to raise real-party-in-interest or privity challenges at any point in a proceedings;
  • The Board reiterated its discretion to stay, transfer, consolidated, or terminate multiple proceedings involving the same claims;
  • Despite some requests for more lax adherence to the one-year time limit for IPRs, the “Office will continue to strive” to meet that deadline;
  • Concerning live testimony at hearings, the Board will continue its practice of considering requests for oral testimony on a case-by-case basis;
  • The Board also signaled that it will provide more guidance on whether parties are limited to certain issues at oral argument, that it plans to upgrade its technology so that hearings can be held in regional offices, and will allow exchange of demonstratives 7 days before a hearing; however, the Board declined to relax the rules concerning content of demonstratives;
  • The Board will be switching to word-count limits, rather than page count limits, for the petition, preliminary response, patent owner response, and petitioner’s reply brief (14,000 words instead of 60 pages for petition, patent owner preliminary response, and patent owner response, and 5,600 words instead of 25 pages for replies). As a result, the Board will no longer review claim charts in petitions for argument. For all other briefing, a page limitation will be maintained;
  • The Board states that it is working to upgrade its filing system to allow easier access to docket information;
  • The Board intends to include a Rule 11-type certification requirement for all filed papers
  • With the final version of these proposed rules, the Office will also issue an updated Office Patent Trial Practice Guide.

Lastly, we are very focused on the statistics that underlie IPR proceedings. In introducing the above changes, Director Lee explained some of the reasons why the Office believes IPR practice has been successful to date. That may be the case, but we were surprised by Director Lee’s citation to statistics regarding the results of IPR proceedings. Specifically, the Director stated that only “12 percent of total claims available to be challenged (4,496 of 38,462) were determined by the PTAB to be unpatentable in a final written decision.” Statistics can, of course, be manipulated and here, we fear, the USPTO may lose credibility. Including claims that were not challenged and claims that were resolved by settlement has a clear effect in raising the survival rate of claims subjected to IPR, without a strong basis for doing so. That is helpful for the Director’s narrative, but in our opinion, is unhelpful to ascertain the true effect of IPR and the Director’s reliance on that skewed stat undermines the other arguments made in favor the success of IPR.

Aug 18

PTAB Addresses Means-Plus-Function Claim in a Post-Williamson World

36713644_sLike every en banc Federal Circuit decision, the Court’s decision in Williamson v. Citrix Online, LLC, No. 2013-1130 (Fed. Cir. June 16, 2015) (en banc) made big headlines. It is, therefore, worth reviewing one of the first PTAB decisions to address the contours of that case in an inter partes review context in Toyota Motor Corp. v. Cellport Sys., Inc., IPR2015-00633, where the Board granted an IPR trial with respect to some claims, but denied as to others.

The first means-plus-function issue related to the claim limitation: “controller means including processing means in the vehicle for controlling the sending and receiving of said information using said wireless device between said first remote station and the vehicle.” More specifically, the Board had to decide the scope of both “controller means” and “processing means.”

The Board recognized that both terms were presumptively means-plus-function limitations pursuant to the Williamson decision. In rendering its claim construction determination, however, the Board agreed with Patent Owner that “controlling means” was not subject to 35 USC § 112, paragraph 6 because: 1) the language of the claim did not link the “controller means” to a specific recited function, and 2) the claim specifies detailed structure sufficient to overcome any recited or implicit function, e.g., controlling. Order at 13. Instead, the Board concluded that the recited function was associated with the “processing means” and “controller means” was simply a controller.

The Board also agreed with Patent Owner relative to the second means-plus-function issue related to limitation: “first standard network communication means.” In evaluating this limitation, the Board first instructed that the proper function for a means-plus-function limitation is the function recited in the claim. As such, the Board accepted Patent Owner’s articulation of the proper function. Then, using this function, the Board evaluated Petitioner’s proposal for corresponding structure and found that the structure identified by Petitioner was not “clearly associated or linked in the Specification to the recited function…” Order at 16.

In view of these claim construction determinations, Petitioner faced an uphill battle in having all claims put into the trial. For example, the Board explained that, for means-plus-function limitations, Petitioner is required to show that both the recited function and the corresponding structure are present in the applied references. Id. at 19. Losing the claim construction ruling made it impossible for Petitioner to win the issue of showing that the “first standard network communication means” was discussed in the Petition.

Aug 17

PTAB Addresses Antecedent Basis Issues in IPR

34108250_sClaims that have terms lacking antecedent basis can present an opportunity for defendants in litigation, including creating a potential invalidity defense under 35 USC §112. It is interesting, therefore, to review the Board’s treatment of these issues in the context of an inter partes review, such as its decision to institute in Google Inc. v. At Home Bondholders’ Liquidating Trust, IPR2015-00662, involving US Patent No. 6,014,698.

In the Decision to Institute Trial, the Board dealt with two antecedent basis issues. In the first instance, the Board considered a claim limitation that required “said banner location signal,” where the claim from which it depended only referred to a “location signal.” Because a person of ordinary skill in the art would read the claim in view of the specification, and the language was similar, the Board concluded that the person of skill would understand “said banner location signal” to refer to the “location signal” of the parent claim.

A later claim in the patent presented a tougher issue for the Board, however. In that case, the dependent claim required that “said banner includes an advertisement.” The parent claims, however, did not recite a “banner” at all. Petitioner suggested that perhaps the claim contained a drafting flaw, and should have depended from a different claim altogether. Alternatively, Petitioner assumed that the “banner” limitation corresponded to the “second portion of information” recited in the parent claim.

The Board declined to adopt either interpretation of the claim, deciding instead that the claim was indefinite and not susceptible to interpretation. Regarding the theory that the claim contained a drafting error, the Board found no basis on which to interpret it to depend from a different claim. Regarding the alternative theory, the Board was not persuaded that a person of skill would have understood the “banner” to refer to the “second portion of information.” In contrast to the above example involving “location signal,” here the terms were substantially different and the Board was unwilling to assume that they corresponded.

Because the Board was unable to determine the scope of the claim, it denied the Petition relative to that claim.

Aug 12

PTAB Denies Challenged Grounds as Redundant in View of Grounds in Different Petition

37975151_sThe Board has a well-established reputation for denying grounds in a petition that are deemed redundant to other instituted grounds. In view of that reputation, Petitioners are adapting, seeking to file multiple petitions, putting grounds that might otherwise be deemed redundant into a separate petition in the hopes that they will be considered in that context. The Board, however, is not backing down, finding on occasion that grounds in one petition may be denied as redundant in view of grounds in a separate petition. That situation arose in CoreLogic, Inc. v. Boundary Solutions, Inc., IPR2015-00219, wherein the Board denied certain grounds in the IPR petition as redundant in view of grounds that were instituted in a completely separate IPR.

In coming to this conclusion, the Board remarked that “Petitioner makes no attempt to distinguish the grounds asserted against the claims of the ‘352 patent in this case from those asserted in [the co-pending IPRs].” Id. at 11. Further, the Board pointed out that instituting a trial in an IPR proceeding is permissive, in the discretion of the Patent Office. In short, because Petitioner did not show, and the Board was not convinced, that any additional obviousness grounds add substantively to the already-instituted grounds (albeit from a different petition), the Board denied certain grounds in the ‘219 proceeding.

As such, Petitioners are warned that the redundancy rejections from the Board may not be overcome simply by placing the additional grounds in a separate petition. Instead, Petitioners must be diligent to explain why each additional ground is necessary and adds substantively to the grounds before the Board, even over grounds presented in completely different petitions.

Aug 04

33 Months of IPR…By the Numbers

UntitledOur apologies for our slightly delayed public dissemination of our Quarterly IPR Report. Please click HERE for the report or email us for a hard copy.

It’s hard to believe IPR has grown up so quickly. We look forward to celebrating its 3-year-old birthday next month.

Let us know if you have any questions or comments about the report in the comment section.

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