16 for 17: First of Three Inter Partes Trials Instituted on Petitions from Illumina

In the first of three petitions for inter partes review brought by Illumina, Inc. against Columbia University was granted in the IPR styled as Illumina Inc. v. The Trustees of Columbia University in the City of New York (IPR2012-00006), involving US Patent No. 7,713,698. The PTAB instituted the IPR trial against all 11 claims based on three of 22 proposed grounds for unpatentability.

The subject matter of the ‘698 patent involves sequencing DNA by incorporating a nucleotide analogue into a newly synthesized strand of DNA, and then detecting the identity of the incorporated analogue. Terms from the patent that were key to the Board’s analysis were “attached”/”immobilized and “deaza-substituted.”

The Board first considered the claim construction of the terms “attached” (claim 1) and “immobilized” (claim 11). While no explicit definition was provided for those terms in the patent, the Board looked to the specification and a dictionary (specifically, http://www.thefreedictionary.com) to determine, first, that the terms should be given the same meaning, and second, that such meaning was “that the DNA, itself, is affixed to the solid surface without intervening structures.” Order at 8.

Next, the Board turned to the issue of anticipation involving several prior art references. With regard to those references, Patent Challenger relied on the fact that those patents incorporated by reference another prior art patent that disclosed a relevant claim term (i.e., “deaza-substituted”). On this issue, the Board cited the test articulated in Advanced Display Sys., Inc. v. Kent State Univ., 212 F.3d 1272, 1282 (Fed. Cir. 2012), wherein it was held that “incorporation by reference provides a method for integrating material from various documents into a host document…by citing such material in a manner that makes clear that the material is effectively part of the host document as if it were explicitly contained therein.” Id. Further limiting what can be deemed effectively incorporated by reference, the Advanced Display decision held that “to incorporate material by reference, the host document must identify with detailed particularity what specific material it incorporates and clearly indicate where that material is found in the various documents.” Id. Because the primary references did not clearly indicate that the secondary art was being referenced for its teaching of the claim limitation at issue, the Board found that none of the grounds for unpatentability based on §102 met the standard to initiate an inter partes review trial.

As part of that decision, it is interesting to note that the Board discounted the testimony of Patent Challenger’s expert witness, finding that the expert did not provide a factual basis for his testimony as to why the teaching from the secondary reference would have been recognized by one of skill in the art. Order at 13. Further, the Board also discounted one of the primary reference’s statements that all documents referenced in the specification were “incorporated by reference.” Such a general statement, per the Board, “does not direct the ordinary skilled worker to specific disclosure [in the secondary reference].” Id.

Having discarded Patent Challenger’s §102 grounds, the Board next turned to several grounds based on §103. The Board’s analysis took on a traditional John Deere structure: (a) the scope and content of the prior art, (b) differences between the prior art and claimed invention, (c) level of ordinary skill in the art, and (d) evidence of secondary considerations. Order at 19.

The Board’s analysis then distilled the prior art down to two basic points: 1) that DNA sequencing by synthesis was known in the art, and 2) that deaza-substituted nucleotides had been used in DNA sequencing prior to the priority date of the ‘698 patent. Order at 23. Having established this distillation of the art, the Board then identified reasons why it would have been obvious to combine the DNA sequencing method with deaza-substituted nucleotides, to render the two independent claims obvious. Using this rationale, the Board ultimately granted the IPR trial on four separate §103 grounds.

It is worth remarking that the rationales being employed to institute IPR trials by various panels of the Board are disparate and, at times, contradictory. Given we are in the infancy stages of these proceedings, this is perhaps to be expected.  Over time, it seems likely that the Board’s decisions will synthesize into more uniform Orders, but it is helpful to recognize who is your Administrative Patent Judge.

14 for 15: Another Inter Partes Review Trial Instituted

SONY DSCSuddenly, the 92% rate at which the Patent Office granted petitions seeking inter partes reexamination seems kind of low.  While the standard for initiating an inter partes review is ostensibly higher (reasonable likelihood) than the standard that was required to institute an inter partes reexamination (substantial new question), the rate at which inter partes review trials are being instituted does not reflect any such difference.  The Board instituted the fourteenth out of fifteen trials in Ranbaxy Labs, Ltd. v. Vertex Pharm., Inc. (IPR2013-00024), involving US Patent No. 5,436,989.  The Board initiated this trial based on two of the four proposed grounds and against all twelve of the challenged claims.

The subject matter of the ‘989 patent includes prodrugs of HIV aspartyl protease inhibitors, including pharmaceutical compositions and methods of treatment.  In general, the advantages of the prodrugs of the ‘989 patent included higher aqueous solubility, higher oral bioavailability, and decreased pill burden/increased patient compliance.

The first chemical trial instituted by the Board, Ranbaxy also is an outlier because it is one of the few decisions by the Board instituting a trial wherein claim construction was not a central part of the Board’s decision.  Perhaps the Patent Owner was simply saving a claim construction dispute for later in the proceeding, but the Board remarked that “the terms recited in the claims of the ‘989 Patent do not appear to be in dispute.”  Order at 4.

Instead, the Board’s decision turned on the issue of whether the claimed chemical compound was obvious, and used the test for obviousness in a chemical case articulated in Otsuka Pharma. Co., Ltd. v. Sandoz, Inc., 678 F.3d 1280, 1292 (Fed. Cir. 2012).  More specifically, the correct inquiry was articulated as “whether the prior art would have supplied one of ordinary skill in the art with a reason or motivation to modify a lead compound to make the claimed compound with a reasonable expectation of success.”  Order at 7.

Starting with the “Reason to Modify” prong of the Otsuka test, the Board undertook a detailed analysis of the state of the art at the time the ‘989 patent was filed and determined that a shortcoming of protease inhibitors, low solubility, was well-known in the art. The Board gained this perspective from a review of the art of record in this inter partes review.  Because one of the prior art references taught the addition of a solubilizing group known to improve solubility of a low solubility compound, the Board found sufficient “reason to modify.”

Turning to the “Reasonable Expectation of Success” prong, the Board found that the prior art discloses a prodrug similar to the claimed compound.  Further, the Board cited to the ‘989 patent description to support its finding that there was merely insignificant differences between the prior art and claimed methods.  As such, the Board found that the similar structure and disclosure of similar solubility problems associated with that structure would have provided a reasonable expectation of success in improving solubility using the methods taught in the prior art.  Order at 13.

The Board relied upon Patent Challenger’s expert’s testimony in coming to its conclusions.  It being improper, of course, for Patent Owner to introduce any counter-testimony at this stage, there was no evidence to dispute the expert’s conclusion.  Patent Owner’s day, in that regard, will come.  In any event, the two Otsuka prongs having been met, the Board instituted the trial against all challenged claims.

Finally, it is worth noting an interesting point raised by the Board regarding the qualifications of Patent Challenger’s expert.  Specifically, the Board stated that “Patent Owner had not directed us to any reason to doubt Dr. Fisher’s qualifications to testify as an expert in the field of HIV aspartyl protease inhibitors.”  Order at 6.  The remark is interesting because the Board has previously shown a reluctance to consider evidentiary issues at this stage of the proceeding and because an expert’s qualifications are not among the items listed in the Trial Practice Guide as proper subject of a Patent Owner Preliminary Response.

Ninth Inter Partes Review Trial Instituted

In the third of four inter partes review trials involving Intellectual Ventures and Xilinx, all instituted on February 12, 2013, the PTAB again has again instituted an inter partes review trial against a Xilinx patent, this time US Patent No. 8,058,897, in the IPR styled as Intellectual Ventures Management LLC v. Xilinx, Inc. (IPR 2012-00020).  As with the previous Orders (see, e.g., HERE), the Board in this IPR proceeding instituted the trial against all challenged claims, granting on four of the nine proposed grounds.

The subject matter of the ‘897 patent covers an integrated circuit that includes multiple dies, wherein a master die receives configuration data for both the master and a slave die.  The key limitations at issue in the Board’s ruling were the terms “integrated circuit” and “die,” with the Board holding that the ‘897 patent claims require a multi-die IC, where a die is a “single piece of silicon that contains one or more circuits and is or will be packaged as a unit” (relying on the “Authoritative Dictionary of IEEE Standard Terms” in coming to this conclusion).

In turning to the Board’s specific analysis of the proposed grounds of unpatentability, a few interesting points are revealed.  At threshold, Patent Owner chided the petition for failing to present prior art that teaches all of the claim elements, including a multi-die IC and, therefore, that the “proposed obviousness rejection” is incomplete.  The Board rejected this argument, finding that IPR proceedings are different than reexamination or continued prosecution in that no “proposed obviousness rejection” is to be made by the Board.  Regardless of how the counter-argument was phrased (it may have been better for Patent Owner to frame its argument that a prima facie case of obviousness had not been advanced), it is eye-opening that the Board accepted a 103 argument where each of the limitations were not found in the proposed combination of prior art.

To come to that obviousness conclusion, the Board remarked that Xilinx did not take into account the level of ordinary skill in the art.  The Board went on to articulate the appropriate level of ordinary skill in the art for this matter, and then went on to find that developing a multi-die IC would have been a matter of routine implementation given that level of ordinary skill.  As such, even though Patent Challenger advanced art that lacked this key limitation of the claims, citing the KSR decision, the Board found that “it would have been within the knowledge and skill set of a person of ordinary skill in the art” to arrange the dies on the same IC, creating a multi-die IC.  Order at 11.

It is also worth noting that the Board rejected, in its discussion relating to Ground 4 (Order at 14-15), the argument by Patent Owner that the Petition was defective for not providing a statement of the precise relief requested.  In a manner that rings of a motion for more definite statement before a district court, Patent Owner had argued that Ground 4 did not specifically articulate the relief requested.  The Board did not accept this argument, finding that Patent Challenger “has substantively provided an underlying explanation of how [the prior art] applied to claims 12-14.”  While the titles used by Patent Challenger may not have been representative of the precise nature it sought, the Board found that to deny Ground 4 based on the titles used would exalt form over substance.  In short, this portion of the decision is interesting because, for one of the very few times, the Board seems to giving some leeway as compared to a strict reading of the Trial Practice Rules.

In the end, the Board instituted the IPR based upon Grounds 1, 2, 4, and 9.  The Board denied Grounds 3 and 5-8, finding that they were cumulative in view of the other grounds that were granted.

At the risk of becoming repetitive, it is worth noting again that the Board did not rely upon the mere recital of “broadest reasonable interpretation,” but rather articulated a specific claim construction for the disputed terms.  Consciously or not, the Board is moving the battlefield for many inter partes reviews to claim construction.  While parties to IPR proceedings must take note of this strong trend, there are certainly risks (especially to patent owners) to articulating claim construction positions in these proceedings and this should be carefully considered when making claim construction arguments.