Oct 24

Dissents and Concurrences Popping up in IPR Proceedings

974041_sThe PTAB has been remarkably consistent to date in its decisions regarding the variety of issues in inter partes review practice. Issues both simple and complex have typically been resolved by one panel and future panels, deciding the same type of issue, fall in line. Of late, however, we have begun to see some divergence in views among the various panels, both in terms of one panel disagreeing with an earlier panel, and even some disagreement within a single panel. This latter situation presented itself in two recent Final Written Decisions in Vibrant Media, Incorporated v. General Electric Company, IPR2013-00172 and Smith & Nephew, Inc. v. Convatec Technologies, Inc., IPR2013-00097.

Vibrant Media involved US Pat. No. 6,092,074 and, more particularly, claims 1-12 of that patent. All three members of the PTAB panel determined that claims 1-8 and 12 were unpatentable. A disagreement between those panel members arose, however, relative to claims 9-11. Claim 9 is directed to a computer system comprising multiple steps.  Claims 10 and 11 depend from Claim 9 and add further steps to the system. The three judges agreed that the claims recited both an apparatus and method steps, an improper combination pursuant to 35 USC § 112, ¶2. But, while the majority acknowledged that mixed system and method claims would not be in compliance with 35 USC § 112, ¶2 for infringement purposes, it did not believe such infirmity in the claims prevented it from reaching the patentability of those infirm claims. The alternative would have been to terminate the IPR as to those claims. Order at 9. The dissent criticized this decision, arguing that an obviousness analysis could not be performed on indefinite claims, as a comparison of the invention as a whole to the prior art would be impossible given the indefinite scope of the claims.  Id. at 51-52. The dissenting judge would have terminated the proceeding relative to claims 9-11, not ruling on their patentability.

Smith & Nephew, involving US Pat. No. 6,669,981, was notable for a disagreement regarding a claim construction, resulting in a concurring opinion from one of the PTAB panel members. The ‘981 patent pertains to methods of enhancing the photostability of silver in antimicrobial materials for use in wound dressings and other medical devices. Of particular interest in the proceeding was a concurrence-in-part, which disagreed with the majority’s interpretation of the claim term “photostable”.  The ‘981 specification defined the term “photostable” as a “controlled colour change to a desired color with a minimal change thereafter.”  Decision at 62.  At issue for in the concurrence was the definition of “desired color.”

The majority interpreted “desired color” to encompass any color which is desirable for any purpose, including aesthetic purposes. The concurrence thought this definition was too broad based on what was known in the art, and that “desired color” should reflect the technical viewpoint that color is a measure of photostability. Id. at 62. Specifically, the concurrence pointed to prior art which taught that purple was not a “desired colour” because the color purple was chemically indicative of the degradation of the antimicrobial properties of the wound dressing.  Accordingly, the concurrence believed that “desired colour” should not include purple, but rather be restricted to the art-recognized color of grayish-white.  Id. at 63. Further, the concurrence disagreed with the majority’s interpretation of “minimal” change (in color), believing (unlike the majority) that a change in color of the wound dressing from a desired color to and undesired color would not be a “minimal” change.  Id. at 64. But, despite the disagreement in claim construction, the concurrence ultimately agreed with the outcome of the analysis the majority reached on the merits.

Oct 23

Rare Grant (in Part) of an IPR Motion to Exclude

iStock_000001758213XSmallMotions to Exclude Evidence have been one of the features of inter partes review practice that have, to date, had a less significant effect than expected. Very few motions have been granted, largely because the Board constructs its Final Written Decisions so as to not rely upon any disputed evidence. As such, motions are often denied as moot. Because the grant of such motions is so rare, we address such a grant that was issued in Corning Inc. v. DSM IP Assets B.V., (IPR2013-00043 and IPR2013-00044), wherein Petitioner moved to exclude evidence and portions of an expert’s declaration.

Petitioner argued in its motion that Patent Owner’s expert testimony relied on experiments that contain hearsay. Id. at 3. More specifically, Patent Owner’s expert relied on various documents generated in Patent Owner’s research laboratories that were created after the filing of the petition and report information relating to particular experiments performed by Patent Owner (such as preparation of samples, chromatography data, viscosity measurements, etc.). Id. 

In rebuttal, Patent Owner argued that the documents, while hearsay, are admissible based on the “business record” exception to the hearsay rule. Fed. R. Evid. 803(6). Id.

The Board found the records-at-issue were excluded because they did not fall within the “business rule” exception. Id. Applicable Federal Circuit and Board precedent declines to invoke a Rule 803(6) exception to a laboratory notebook documents and laboratory generated data of properties of compositions experimentally made in laboratories. Further, “conducting specific and unique scientific experimental work is not ‘a regularly conducted activity.'” Id. at 5.

All was not lost, however, for Patent Owner. Despite the fact that Patent Owner cannot have the exhibits admitted under Rule 803(6), its expert was allowed to rely on them in forming his opinion. Id. To that end, Rule 703 provides in part: “An expert may base an opinion on facts or data in the case that the expert has been made aware of or personally observed. If experts in the particular field would reasonably rely on those kinds of facts or data in forming an opinion on the subject, they need not be admissible for the opinion to be admitted.”

Because the documents-at-issue were not shown to be unreliable, the evidence of the experiments is excluded as hearsay, but the expert’s related testimony was admissible. Id. at 8.

Oct 22

An Overdue Discussion of the PTABs Grant of the First IPR Motion to Amend

17624885_sIt is hard to explain how this post, discussing the first ever granted Motion to Amend in an inter partes review, sat in “draft” mode for over 5 months. This is especially perplexing given the difficulty Patent Owners are experiencing relating to the issue of amending claims in an IPR. But, in a way, the decision has become even more remarkable in the months that have passed since it issued on May 20, 2014, because no other Motion to Amend has been granted. So, today we finally address International Flavors & Fragrances, Inc. v. The United States of America, as Represented by the Secretary of Agriculture, IPR2013-00124, wherein the Board granted the first (and still only) Motion to Amend in the over two years of inter partes review. So….what went right for the US Government given how the amendment process has gone so wrong for every other Patent Owner?

After the Petition by IF&F was filed, Patent Owner (the US Government) did not contest the grounds set forth in the Petition, instead conceding the unpatentability of the challenged claims and filing a Motion to Amend Claims. This motion proposed amended claims 27-45. Order at 2. Of perhaps critical importance in this decision, Petitioner did not oppose the Motion to Amend, leaving the Board by itself to decide the patentability of the amended claims solely on the record presented in the Petition and Motion to Amend.

Following the precedent of Idle Free Sys., Inc. v. Bergstrom, Inc., IPR2012-00027, at 33 (PTAB January 7, 2014 (Paper 66)), the Board noted that in a Motion to Amend, the Board bears the burden of demonstrating patentability of the proposed claims over the prior art in general to be entitled to the proposed amended claims.  Id. at 7. To that end, the Board first determined that the proposed claims were not broadening and had written description support. Id. at 9-10.

The Board then turned to the issue of patentability over the prior art, a hurdle that no other Patent Owner had before, or has since, negotiated. By way of background, the patent-at-issue relates to a new compound useful as an insect repellent. Patent Owner proposed 18 amended claims – 2 independent claims (claims 27 and 45) and 16 dependent claims (that all depended from claim 27). Claim 27 amended an original claim by specifying a Markush group from which the claimed analog was to be selected. Claim 45 added that the claimed repellent is applied against ticks or mites.

Interestingly, the Board first remarked that Patent Owner only addressed the the art presented in the Petition and identified one of those references as the “apparent” closest prior art. More specifically, Patent Owner argued that “Substitute independent claim 27 is patentable over the cited references, of which Behan appears to be the closest known prior art, because the cited references do not disclose or suggest that….” This is the type of conclusory statement that has sunk many previous Patent Owners. See, e.g., Toyota Motor Corp. v. Am. Vehicular Sciences LLC, IPR2013-00419, Paper 32, at 4 (PTAB Mar. 7, 2013) (“Explaining patentability over references applied by the petitioner against the original patent is not the main event.”).

Here, though, the PTAB decided that the US Government had sufficiently demonstrated, beyond the conclusory statement, that “the level of ordinary skill in the art, as well as providing evidence regarding what would have been understood by the ordinary artisan as to those features being relied upon to demonstrate the patentability of the proposed claim.” Order at 12. Specifically, the Board noted evidence that explained that small changes in structure can result in significantly different properties in the chemical compound. As such, because the prior art did not provide a reason to modify the parent compound to arrive at the members of the Markush group of new claim 27, nor did the art provide a reasonable expectation that such modifications would result in a compound having the desired insect repellent activity, the preponderance of the evidence supported the patentability of proposed claim 27. Id. at 15. Notably absent, however, was any explanation why, in this case, a failure to go beyond the art cited in the petition was sufficient, when that has not been the case for many other patent owners.

Because claims 28-44 all incorporated the limitations of claim 27, they were found patentable for the same reasons. Id. 

The Board did reject claim 45 that, as mentioned, sought to claim the use of the parent compound for ticks and mites, because the same compound was shown in the prior art to be effective against cockroaches and mosquitoes. Id. at 17-18. The Board found that maxim that, merely discovery a new benefit of an old process does not render the process again patentable, was applicable here. Proposed substitute claim 45 was, therefore, denied.

When all of the Final Written Decisions that have denied Motions to Amend have been reviewed, it is difficult to come up with a firm understanding of why many other motions that did not discuss the art generally were denied, yet this motion by the US Government was granted. For example, at the the PTAB AIA Roundtable, the Board suggested that a certified prior art search, or some other good faith effort by the patent owner to tell the Board what it knows, especially about the added feature, is required. We are not sure that was done in this case, but the Board still granted the motion. Decide for yourself – the successful Motion to Amend Claims is HERE.

Oct 21

PTAB Shows a Willingness to Intervene in Deposition Disputes

10929882_sExperienced district court litigators are reluctant to “call the judge” when a dispute arises during a deposition. Judges do not want to take the time to deal with mundane discovery disputes and parties do not want to get on the wrong side of the judge. The Office Patent Trial Practice Guide bucks this trend, explaining that “[t]he Board encourages the use of conference calls to raise and resolve issues in an expedited manner.” Id. at 48758. We think lawyers are still reluctant to make that call, but experience is showing that the Board is willing to intervene to settle procedural matters.

For example, in Toyota Motor Corp. v. American Vehicular Sciences LLC, IPR2013-00424, Patent Owner asked the Board to limit cross-examination of its expert witness by prohibiting questions directed to whether a feature would have been obvious to one with ordinary skill in the art. Paper 33 at 2. The Board granted the request.

In the Petition, Petitioner relied on a particular prior art reference as disclosing the claimed feature, not as rendering that feature as obvious. Petitioner argued that “obviousness, inherent disclosure, and the understanding of ordinary skill in the art…are inter-mingled as one integral discoverable topic.” Id. at 3. The Board, however, disagreed stating the Petitioner knew the difference between the separate concepts and that they topics were not one and the same. Additionally, the Board found Petitioner has no reason to inquire about the obviousness in light of that feature based on the specific grounds instituted for trial, the arguments in the petition, and absence of testimony in the expert witness’s declaration regarding obviousness of the feature. Id.

In short, deposition combatants take note – the Board is showing both a willingness to intervene in discovery disputes and to limit the testimony of witnesses to only that which is at issue in the IPR proceeding.

Oct 20

Later Priority Date for IPR-Challenged Patent Where No Written Description in Parent

4177464_sThe Board denied an interesting attack from Patent Owner who suggested that Petitioner’s argument, that the patent-at-issue was not entitled to the priority date of its parent, was barred in inter partes review proceedings because it is based on 35 U.S.C. § 112. SAP America, Inc. v. Pi-Net International, Inc. IPR2014-00414, involving US Patent No. 8,346,894; and parent patent, US Patent No. 8,037,158.

Petitioner argued that the subject matter of the challenged claims of the ‘894 patent were not disclosed in the parent ‘158 patent in a manner sufficient to meet the requirements of 35 USC §112, first paragraph. Order at 11. As such, per Petitioner, the ‘894 claims were not entitled to the priority date of the ‘158 parent patent.  Specifically, Patent Challenger argued that negative limitations in some of the ‘894 claims were not disclosed in the ‘158 parent specification. Id.

Patent Owner’s Preliminary Response argued that the petition exceeded the scope of inter partes review (which allows only challenges under 35 USC §102 and §103) by including an analysis under §112 in the challenge.

The Board began its analysis by noting that there is a difference between arguing that a claim is unpatentable based on §112 inadequate written description grounds and arguing that a claim is not entitled to a given priority date based on §112 grounds.  Further, Patent Owner provided no arguments on the merits against Petitioner’s assertions of lack of written description in the parent ‘158 patent.  Accordingly, after dismissing inapplicable case law cited by Patent Owner because of this distinction, the Board agreed with Petitioner and found that the ‘894 challenged claims were not entitled to the priority date of the ‘158 patent because the ‘158 patent did not provide an adequate written description of the challenged claims.

Oct 20

PTAB Disqualifies Art as Being Non-Analogous to Claimed Invention

13111368_sA limited number of cases, to date, have dealt with the issue of analogous prior art in an obviousness analysis. In Schott Gemtron Corp. v. SSW Holding Co., IPR2014-00358, the Board addressed this type of issue, finding in favor of Patent Owner that the art-at-issue was not analogous and, thus, disqualifying its use in the IPR proceeding.

The ‘561 patent relates to shelving which has a hydrophobic top surface arranged in a pattern to contain spills. At issue in the petition was whether Petitioner had established that a reference which relates to microscope slides was analogous art.  The Board noted two factors in this determination, either of which is sufficient to establish a reference as analogous:

  • if the reference is from the same field of endeavor as the claimed subjected matter, regardless of the problem addressed; or
  • if the reference, even though not within the field of the claimed invention, is reasonably pertinent to the problem with which the inventor is involved.

Further, the Board noted that the purpose of the claimed invention and the purpose of the prior art reference are important to the inquiry of whether the reference is analogous art.

That the reference was not in the same field of endeavor as the ‘561 claimed invention was not in dispute.  Both parties agreed that shelving and microscope slides were not in the same field.  However, Petitioner argued that the reference was reasonably pertinent to the problem faced by the inventor of the ‘561 patent.  Specifically, Petitioner argued that both the reference and the ‘561 patent pertained to the problem of how to contain a liquid in a predetermined area using a thin structure that extends minimally from a surface.

Patent Owner argued that the reference was not analogous because the reference (related to microscope slides) did not pertain to containment of spills (construed as “an accidental or unintentional release of liquid” by the Board) because liquids are intentionally put on microscope slides.  The Board agreed with Patent Owner, citing the recitation of a “spill containment” pattern in the ‘561 claims and considerable support for a spill containment feature in the ‘561 specification.  Therefore, the reference and the ‘561 invention did not address the same problem.

Further, the Board explained that even if the reference qualified as prior art, it was different enough from other cited references that one skilled in the art would not have been familiar enough with the reference to combine it with others to mount a successful obviousness challenge.  Therefore, the Board dismissed the obviousness challenge.

Oct 17

Infringement Contentions From Copending Litigation Not Allowed as Supplemental IPR Information

Glucosamine & MSM labelingThe circumstances under which the Board will entertain the inclusion of “supplemental evidence” in an inter partes review proceeding remains a moving target. It is worth noting, therefore, the case of Mentor Graphics Corp. v. Synopsys, Inc., IPR2014-00287, wherein the Board denied Petitioner’s efforts to include Patent Owner’s infringement contentions from a co-pending district court litigation involving the same patent. Paper 17 at 2. Petitioner claimed that these contentions reflect Patent Owner’s assessment of the claim scope. Id.

The Board found that the only relevance the contentions have is an alleged inconsistency as compared to arguments made by Patent Owner in the IPR. Id. at 3. They further determined that the contentions were served prior to any substantive discovery in the district court litigation and are supplanted by final infringement contentions as well as the District Court’s Order Construing Claims. Id. The Board, therefore, found that, while the district court’s construction may be informative, the preliminary infringement contentions are too tenuous to be relevant to the Board’s application of the broadest reasonable construction standard. Id. Thus, Petitioner’s Motion to Submit Supplemental Information was denied. The Board however noted that Petitioner can bring these contentions forward in its Reply, if appropriate as rebuttal. Id.

Oct 16

PTAB Offers Guidance Regarding Discovery in Inter Partes Reviews

iStock_000013492145XSmallStill confused about how much discovery you will be able to obtain in an IPR? Fear not, as two of the PTAB’s Administrative Patent Judges have weighed in with a primer on inter partes review discovery. The PTAB blog entry provides a nice overview of “routine” and “additional” discovery, including some insights into the reasons why the Board believes it is constrained in its grant of additional discovery in IPR proceedings.

To that end, as our statistics have made clear, only 28% of Motions for Additional Discovery have been granted through the 2nd year anniversary of IPR practice. Of note in the PTAB’s blog posting is that this low percentage is due to several key constraining forces on the Board. First, the AIA legislative history makes clear that additional discovery is confined to “particular limited situations, such as minor discovery that PTO finds to be routinely useful, or to discovery that is justified by special circumstances of the case.” Second, statutory deadlines for completing IPR proceedings require a much more streamlined procedure than the broad discovery allowed in litigation. Third, the Board notes the fact that discovery is only allowed when in the “interests of justice.” Because this standard is slightly higher than the “good cause” standard, the Board is more constrained on this issue than on other issues it is called on to decide.

Lastly, the article provides a helpful synopsis of a number of other PTAB decisions relating to additional discovery that can be a helpful reference.

Oct 15

PTAB Getting Tough on Petitions Seeking to Circumvent Page Limit

11011816_sOld habits are hard to break. Patent attorneys love to put forth every argument in their arsenal and let the chips fall where they may. Problem is, Congress set up inter partes review procedures to ensure a just, efficient and inexpensive resolution to the patentability of challenged patents. To that end, Patent Office regulations require a maximum, 60-page limit for the Petition. To get around this limit, Petitioners are increasingly seeking to stash a large portion of their arguments in an expert report that accompanies the Petition. In this way, citations in the Petition to these lengthy declarations are intended to allow Petitioners to include all of their arguments in their filing, but still stay within the 60-page limit for a Petition. Problem is…..the PTAB recognizes this technique for what it is – a way around the page limit. Numerous Petitions have now been denied as failing to comply with the page limit because Petitioner’s arguments are not contained “within the Petition.”  35 U.S.C. § 312(a)(3) (“A petition filed under section 311 may be considered only if…(3) the petition identifies, in writing and with particularity, each claim challenged, the grounds on which the challenge to each claim is based, and the evidence that supports the grounds for the challenge to each claim…”).

This scenario was presented in Fidelity National Information Services, Inc., v. DataTreasury Corp., IPR2014-00489, involving US Pat. No. 5,910,988. Petitioner asserted seven grounds of unpatentability and provided a claim-by-claim analysis to show all limitations taught or suggested in the art. Throughout the petition, Petitioner cited to a declaration by an expert that spanned nearly 300 pages and further comprised a 1,003-page, single-spaced claim chart labeled as Exhibit A.  The claim chart also incorporated the prior art references themselves.

The Board found that Petitioner used this system of multi-level incorporation to circumvent the page limit requirements of the petition. Within each ground, Patent Challenger used only a few pages of the actual petition to essentially incorporate many more pages of arguments by citation to the declaration, which further cited to the claim chart.

Under 37 C.F.R. § 42.22(a)(2), a petition for inter partes review must contain a “full statement of the reasons for the relief requested, including a detailed explanation of the significance of the evidence.”  In view of this requirement, the Board ignored much of Petitioner’s arguments, as they were contained in the declaration and claim chart, not the Petition itself.  As such, the Petition lacked sufficient citation to the references themselves to support the asserted grounds of unpatentability and the Board denied the petition.

UPDATE: Petitioner’s Motion for Rehearing was denied on October 9, 2014.

Oct 14

Board Considers Proof of Diligent Reduction to Practice

22397198_sPatent Owner’s attempt to disqualify prior art in an inter partes review failed because it could not show diligence from conception to reduction to practice in Medtronic, Inc., et al. v. Troy R. Norred, M.D., IPR2014-00395, U.S. Patent No. 6,482,228.

Patent Owner’s preliminary response sought to remove one of the allegedly-anticipatory references as prior art by providing evidence of conception prior to the effective filing date of the reference and diligence to reduction to practice (the filing of the patent application, in this instance). To remove a reference with an art-date during 1999, Patent Owner argued that the claims at issue of the ‘228 patent were conceived in late 1998 and there was reasonable diligence until reduction to practice. To support the argument, Patent Owner submitted documentary evidence and exhibits to the Board.

The Board was not persuaded, however, finding that the exhibits were not sufficiently linked to each claim limitation to prove reasonable diligence during the period between conception and filing of the patent application. The Board specifically pointed out that though some exhibits pertained to drawings present in the ‘228 patent, those drawings were not relied upon to illustrate claimed features of the invention. Further, the evidence presented did not show several claimed features of the ‘228 invention, including a “tissue valve.” Therefore, reasonable diligence was not proven for all claimed features and the reference at issue was deemed to be prior art.

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