PTAB Issues Precedential Opinion Regarding “Follow-On” Petitions

“If at first you don’t succeed, try, try again….” may not be an appropriate mantra for the PTAB. Today, the PTAB made precedential an opinion that was initially issued on September 6, 2017 regarding the appropriateness of “follow-on” petitions and the factors PTAB panels must consider when deciding whether to allow follow-on petitions. General Plastic Indus. Co., Ltd. v. Canon Kabushiki Kaisha.

A follow-on petition is a petition filed after an earlier filed petition was unsuccessful. For example, in General Plastic, Petitioner filed a first set of petitions seeking inter partes review of two patents. For each of these petitions, an IPR trial was denied on the merits. Nine months later, Petitioner filed a second set of (follow-on) petitions against the same patents. The PTAB denied those petitions pursuant to 35 U.S.C. § 314(a), finding that the follow-on petitions should not be allowed in view of the denial of the earlier-filed petitions.

After Petitioner filed a request for rehearing, the Chief Judge of the PTAB instituted an expanded panel, which panel ultimately denied the requested rehearing. In the rehearing request, Petitioner had argued, among other things, that follow-on petitions are expressly contemplated in the statute implementing IPRs, specifically in 35 U.S.C. § 325(d). And, further, any consideration of follow-on petitions should be governed by § 325(d) (which only allows rejection of follow-on petitions when the same or substantially the same art or arguments were previously presented to the PTO).

In the end, the Board maintained the stance on follow-on petitions first articulated in the NVIDIA case, holding that it’s discretion is derived from  § 314(a). Of course, now, that position is mandatory to all panels through this precedential opinion. As review, below are the non-exhaustive NVIDIA factors to consider:

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 U.S.C. § 316(a)(11) to issue a final
determination not later than 1 year after the date on which the Director notices institution of review.

A key takeaway from this decision is that the PTAB has chosen to address the follow-on petition issue under a broadly-construed reading of § 314(a), rather than the seemingly more on point (and narrower) provisions of § 325(d). Is this rule-making by PTAB decision, of the type recently over-turned in Aqua Products? We predict that time (and the Federal Circuit) will soon tell.

Toward a Bullet-Proof Petition – Motivation to Combine

white puzzle with one piece missing, on blueWhile 8 out of 10 Petitions seeking inter partes review are granted by the PTAB, there remain several key errors that unsuccessful Petitioners make. Among them is the failure to provide sufficient factual basis for a rationale to combine prior art references in an obviousness analysis. That issue arose, in an unsuccessful petition, in Kinetic Technologies, Inc. v. Skyworks Solutions, Inc., IPR2014-00529, where the Board found Petitioner’s motivation to combine arguments inadequate. The case involved US Pat. No. 7,921,320, directed to a single wire serial interface that may be used to control stand-alone power integrated circuits and other devices.  Decision at 3.

Petitioner, in arguing obviousness of the challenged claims, asserted that combining to two prior art references was a matter of combining know elements to yield predictable results, among other conclusory remarks. Petitioner did list several similarities in the circuits of the two references, and provided expert testimony, but did not provide much in the way of details. Id. at 14.

As such, the Board was unpersuaded by Petitioner’s argument for motivation to combine. First, the Board gave little or no weight to the expert testimony, since it was virtually identical in content to the arguments presented in the petition, and lacked facts or data to support the opinion of the expert. Specifically, the Board criticized the expert declaration as filing to “expain the ‘how,’ ‘what,’ and ‘why’ of the proposed combination of references.” Id. at 15. To that end, the Board found that the expert did not explain how the references could be combined, or how such combination would yield a predictable result.  In the final criticism of the expert testimony, the Board noted that the expert failed to explain why the ordinary artisan would have combined elements from the two references in the specific way the ‘320 invention does.

Accordingly, the Board reminded Petitioner that there must be reasoning supporting combination of references in an obviousness challenge, and rejected Petitioner’s argument for motivation to combine references, stating that the argument lacked articulated reasoning with rational underpinning. Id. at 16. As such, the Board determined that Petitioner failed to demonstrate a reasonable likelihood that it would prevail in establishing the challenged claims as unpatentable.

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.

Board Will Not Fill In Evidentiary Gaps in Inter Partes Review Petition

iStock_000009779932SmallIn a victory for Patent Owner, Zerto was unable to get any of 13 challenged claims of an EMC Israel Development Center patent into a trial for inter partes review, in Zerto, Inc. v. EMC Israel Development Center, Ltd., (IPR2013-00458), involving U.S. Pat. No. 7,577,867.

The ‘867 patent generally relates to “data protection and disaster recovery and, in particular, to tracking and managing storage systems with dynamically changing data.” More specifically, the ‘867 patent discloses processing data across multiple nodes of a “storage area network.”

Of interest in the Board’s decision was its analysis of a ground for obviousness in view of two references.  Finding that Petitioner had failed to set forth sufficient evidence to meet its burden, the Board made clear that it would not “resort to speculation or unfounded assumptions.”  Order at 18, citing In re Warner, 379 F.2d 1011, 1017 (CCPA 1967).  “We will not resort to such speculation or assumptions to cure the deficiencies in the factual basis in order to support Petitioner’s alleged grounds of unpatentability based in whole or in part on Warrick.”  Id. 

Also interesting was the Board’s consideration of whether a reference constituted prior art.  The “Kashya” reference had a title page bearing a date of August 4, 2004.  Order at 25.  Petitioner relied on this date as proof of the art’s relevance as 102(b) art.  But, the reference also has a copyright date of 2013.  The reference further states that “[a]ll information contained or disclosed by this document is considered confidential and proprietary by Kashya Inc.”  Lastly, the reference contained “tracked changes” that gave the appearance that it was merely a working document.  As a result of these facts, Patent Owner contended that Petitioner had not sufficiently established that the document qualified as a printed publication.

The Board held that, because Petitioner did not address the other evidence in Kashya, that indicates that it has not been disseminated publicly, the reference did not qualify as a prior art printed publication.  For example, the “confidential and proprietary” notice has been considered by the Federal Circuit – Northern Telecom, Inc. v. Datapoint Corp., 908 F.2d 931, 936-37 (Fed. Cir. 1990) (holding that documents containing the legend “Reproduction or further dissemination is not authorized…not for public release” were not printed publications).

Unsuccessful on all grounds, Zerto was unable to get 13 challenged claims of the ‘867 patent into a trial for inter partes review.

23 for 24: PTAB Provides Guidance on Petition Drafting in Instituting 23rd Inter Partes Review Trial

Denso and Clarion were successful in getting half of the claims of a patent owned by Beacon Navigation into an inter partes review trial, in the case styled as Denso Corp. and Clarion Co. Ltd. v. Beacon Navigation GmbH, IPR2013-00026, involving US Patent No. 6,029,111. The Board granted the IPR trial for 14 of the 28 challenged claims based on 4 of the 8 references presented by the Patent Challenger. The remaining claims were not placed into the IPR trial, marking one of the relatively few decisions in which an IPR trial was only granted for some of the challenged claims. It is also an unusual case because the Patent Challenger only challenged the ‘111 patent on anticipation grounds, with no obviousness grounds at all.

The subject matter of the ‘111 patent describes a navigation system in which information from a GPS is used to obtain velocity vectors, which include speed and heading components, for propagating or “dead reckoning” the vehicle position from a previous position to a current position. The current position is calculated by adding displacements obtained from the GPS velocities to the previous position. GPS position data alone is not accurate enough for certain applications, but GPS velocities are much more accurate than the position data and can be sued to propagate a known solution forward and be more accurate over time then the GPS position solution.

The Board first noted that ordinary and customary meaning would be used for all claim terms because Patent Challenger did not provide any proposed constructions.  In so holding, the Board softly criticized the petition, pointing out that the Petition relied largely upon claim charts, but lacked sufficient discussion and explanation of the unpatentability arguments upon which Patent Challenger relied:

Relying on claim charts with little or no supporting discussion or explanation assumes that the anticipation contentions are self-evident from them.  That is usually not the case, especially where, as here, the technology is complex.  That is why our rules state: “The Board may exclude or give no weight to the evidence where a party has failed to state its relevance or to identify specific portions of the evidence that support the challenge.”  37 C.F.R. § 42.104(b)(5).

The Board’s comment certainly provides a caution for patent challengers, especially in complex technology areas.  While page limitations can be a concern, it is not advisable to simply present unpatentability contentions in claim chart format. Instead, the claim chart should be accompanied by detailed explanation of the arguments contained in the claim chart, including the positions taken by Patent Challenger’s expert.

Moving beyond the claim construction and drafting issues, the Board ultimately decided that some of the proposed anticipation grounds met the reasonable likelihood standard.  In this regard, the Board made several potentially noteworthy conclusions, indicating the types of arguments and evidence the Board may be willing to rely on in deciding anticipation challenge grounds. As to claim 1, the Board took note of a “well-known calculus/physics principle” that integrating velocity yields a position displacement. Order at 19. As to claim 2, the Board found that even though “east” and “north” displacements were not explicitly recited in the anticipating reference, they were inherently disclosed because a velocity vector can have any direction. As to claim 6, the Board cited to a declaration submitted by the Patent Challenger in determining that there was a reasonable likelihood of prevailing for that claim. Order at 20-21.

The Board continued to stress the importance of additional argument beyond claim charts by finding no reasonable likelihood of prevailing as to claim 1 under one particular reference, “in the absence of any analysis from Petitioners above and beyond what is set forth in the claim charts.” Order at 29. There was one instance, however, in which the Board conducted their own review of a translated foreign reference which was only mentioned in the petition in claim charts that generally referred to certain pages of the foreign reference without any explanation. Order at 42. The Board did find a reasonable likelihood of prevailing on some of the claims, but not all, based on the foreign reference.

In the end, the IPR trial was instituted for only half of the claims, using only half of the asserted references for those claims. Interestingly, the Board did not deny any grounds based on redundancy, but instead made specific findings for every ground for each reference as to whether all elements of the claim were disclosed in the reference. The Board actually granted four different grounds based on four different anticipating references for many of the claims which were put into the IPR trial.

Stay tuned….while the faulty petition may have been the cause of numerous grounds for unpatentability being denied, the Board noted in its decision that there are 18 pending district court litigation matters relating to the patent-at-issue.  Guidance from the Board may lead one or more of the other defendants to retry the denied grounds.

What is in your Inter Partes Review Claim Chart?

The claim chart has been a fixture of Patent Office post-grant practice, let alone federal court litigation, and inter partes review should be no different.  As has become a theme in inter partes practice, however, strict adherence to the Patent Office regulations is paramount in these proceedings, and the venerable claim chart has not avoided the glare of the Board.

In the case of Xilinx, Inc. v. Intellectual Ventures I, LLC (IPR2013-00112), the Board convened a conference call to discuss defects in the petition filed by Xilinx.  In the end, the Board accepted the petition, but made clear that the petition was flawed because it contained defective claim charts.  Specifically, the Board slapped Xilinx’s wrist because the claim charts contained analysis that went beyond the process of identifying key features of a claim and comparing those features with specific evidence.

The Board’s position is interesting because it is unclear where the Board derived the basis for its strict objection to the claim charts.  The Trial Practice Rules (at 48764) state that claim charts are not required, but that they may be filed to “explain clearly and succinctly what the petitioner believes a claim means in comparison to something else, such as another claim, a reference or a specification.”  The Rules go on to explain that such charts may streamline the process of identifying key features of a claim and comparing those features with specific evidence.  Of course, this latter language is what was cited by the Board in its conference call and subsequent Order, but there is nothing in the rule that would seem to prohibit including analysis in the claim chart.  There also is little to help us discern what types of “analysis” were troublesome to the Board.

Our best guess is that the Board is concerned about the page limitations that are imposed on petitions.  The inter partes rules state that a claim chart may be single-spaced, despite the requirement that a petition must otherwise be double-spaced.  If a petitioner were to include a significant amount of analysis and argument in the claim chart, instead of a succinct comparison of claim language versus specific evidence, this would help a petitioner to avoid the strictures of the page limitation.