PTAB Reversed on Issue of Diligent Reduction to Practice

cafc1Perfect Surgical Techniques (PST), Inc. owns US 6,030,384 (‘384). Olympus petitioned for inter partes review of ‘384 as anticipated or obvious over JP H10-33551 (JP ‘551). JP ‘551 published less than one year before the ‘384 priority date, and therefore JP ‘551 was only art under pre-AIA 35 U.S.C. §102(a). PST offered a Rule 131 affidavit to remove JP ‘551 as prior art. The Patent Trial & Appeal Board (PTAB) ruled that the affidavit did not show sufficient evidence of continuous diligence between conception and reduction to practice, and therefore JP ‘551 is prior art to ‘384.

The ‘384 inventor was a working surgeon, so most of his working day was given over to patient care. Inventor hired a patent attorney to draft the application that later became ‘384, and the attorney sent the inventor a draft on 28 January 1998, thus proving that the inventor had conceived of the invention before JP ‘551 published on 10 February 1998. PST relied on the ‘384 filing date (1 May 1998) for reduction to practice. Therefore, PST had to show diligence between 9 February (the day before the publication date of the Japanese reference) and 1 May. PST submitted correspondence and invoices from the attorney to show that the inventor and attorney were working diligently in that intervening time, but these records only documented activity on 2, 4, 12, & 16 March and on 7 & 13 April.

The question for the PTAB, then, was whether the gaps between (e.g.) 4 and 12 March, or between 16 March and 7 April were so long as to show a lack of diligence. The PTAB concluded that these gaps showed that the inventor and attorney were not continuously exercising reasonable diligence.

On appeal, PST argued that the PTAB had applied an incorrect legal standard by requiring continuous exercise of reasonable diligence. PST argued—and the Court of Appeals for the Federal Circuit (CAFC) agreed—that the correct standard is “reasonably continuous exercise of diligence.” In other words, one does not need evidence that one’s reasonable diligence was continuous, but rather one needs evidence that one’s diligence was “reasonably continuous.” See, Tyco Healthcare v. Ethicon Endo-Surgery, 774 F.3d 968, 975 (Fed. Cir. 2014) (“To establish diligence in reduction to practice, the basic inquiry is whether there was reasonably continuing activity to reduce the invention to practice,” internal quotations and ellipsis omitted).

The CAFC vacated and remanded for the PTAB to reconsider whether the evidence showed “reasonably continuous” diligence. Therefore, Perfect Surgical stands for the proposition that the standard for proving prior invention is not “continuous reasonable diligence,” but instead is “reasonably continuous diligence.”