The Patent Trial and Appeal Board (“the PTAB”) has a staunch reputation for rarely granting a patent owner’s motion to amend claims during inter partes review proceedings (to date, the Board has only granted six such motions to amend). However, in the matter of Shinn Fu Co. v. Tire Hanger Corp., IPR2015-00208 (decided on April 22, 2016), the PTAB granted The Tire Hanger Corporation’s (“Tire Hanger”) motion to amend the claims of its U.S. Patent No. 6,681,897 (“the ‘897 patent”). The PTAB’s decision allowed Tire Hanger to salvage invalid claims with narrowing claim amendments and provides encouragement to patent owners that more motions to amend may be granted by the PTAB in the future.
The America Invents Act (AIA) provided several mechanisms for reviewing the validity of issued patents. While Inter Partes Review (“IPR”) is commonly used, a review of Covered Business Method (“CBM”) patents is another mechanism for reviewing validity. Moreover, challenging a patent using CBM can be more desirable than in an IPR, since CBM provides the petitioner more bases for review than in an IPR.
Federal Circuit Affirmed: Institutions Decisions Are Not Appealable and Broadest Reasonable Interpretation Is Reasonable
On June 20, 2016, the Supreme Court issued its ruling in Cuozzo Speed Technologies, LLC v. Lee. There were two issues presented in Cuozzo: (1) whether the Board’s institution decision of an IPR is appealable, and (2) whether the broadest reasonable construction standard is appropriate to apply in patent office proceedings. For both of these issues, the Court affirmed the Federal Circuit’s previous ruling.
The outcomes of inter partes review petitions and final written decisions have differed dramatically for claims in pharmaceutical patents, compared to other technologies, particularly for obviousness challenges of claims to chemical compounds. In its final written decisions of Orange Book-listed patents, the Patent Trial and Appeal Board (“PTAB”) has found claims unpatentable 35% of the time, in contrast to a 73% unpatentability rate in final written decisions across all technologies. Likewise, in its institution decisions, the PTAB has granted 70% of petitions for inter partes review, but only 57% of petitions concerning pharmaceutical patents, and only 30% of petitions raising obviousness challenges of chemical compounds.
In Blackberry Corp. v. Zipit Wireless, Inc., IPR2014-01506, the Patent Trial and Appeal Board found that testimony of the Patent Owner’s declarant was owed diminished weight due to misstatements in the declarant’s Curriculum Vitae (“CV”). However, despite the reduced weight, the Board nevertheless found that the Patent Owner had a winning claim construction argument as to the meaning of a claimed “graphical symbol.” As a result, the Board determined that the Petitioner failed to establish that any claims of the patent-at-issue were disclosed or made obviousness by the art of record.
Novelty and obviousness are governed by 35 U.S.C. §§ 102 and 103, respectively. Generally speaking, a novel claim is one that has not been previously described or practiced. Similarly, a claim is non-obvious if the claim, as a whole, would not have been obvious to one of ordinary skill before the effective filing of the patent application or, for pre-AIA, invention by the inventor. Anticipation under § 102 requires that all the elements of a claim be found in a single prior art reference. The elements must be either expressly or inherently described in the reference without modification.
On March 31, 2016, in Alarm.com v. Vivint (IPR2015-020004), the Patent Trial and Appeal Board (PTAB or Board) denied institution of an inter partes review (IPR) of claims 1-43 of U.S. Patent No. 6,147,601 (the ‘601 patent). The Petitioner asserted that many of the claims of the ‘601 patent, including every independent claims, were anticipated by a single reference, Scadaware, and that a number of dependent claims were obvious over Scadaware either alone or in combination with other references. In the obviousness assertions, the Petitioner did not revisit the elements of the independent claims, but merely relied upon the anticipation analysis. The PTAB found that Scadaware failed to anticipate each and every element of the independent claims, and thus denied the assertion that the independent claims were not novel. The PTAB further denied institution of the obviousness assertions, finding these deficient by virtue of their reliance on the anticipation analysis.
The Patent Trial and Appeal Board (PTAB) may deny institution of inter partes review (IPR) of claims of a patent if the Petition for IPR repeats the same issues made during prosecution of the patent, even if the Petition uses a prior art reference cited during prosecution to reject only other claims of the patent and uses new secondary references. Additionally, where the newly cited art and arguments are the same or substantially the same as those previously presented to the Office, the PTAB will not reconsider the any evidence of secondary considerations already considered during prior prosecution.
On February 24, 2016, in Ziegman v. Stephens (IPR2015-01860), the PTAB denied institution of IPR of claims 12-15 of U.S. Patent No. 8,881,447 (the ‘447 patent), because the Petitioner presented substantially the same art or arguments as those previously presented to the U.S. Patent and Trademark Office (the Office).
On April 1, 2016, the USPTO published final amendments to the Rules of Practice for PTAB AIA trials. The amendments are effective May 2, 2016, and apply to all AIA petitions, whether they were filed before, on or after the effective date. Highlights include:
1) 37 C.F.R. § 42.11: The amended rules require that every paper be signed and that the signature complies with the signature requirements set forth in 37 C.F.R. § 10.18(a). The act of presenting a paper to the PTAB will be considered a certification as set forth in 37 C.F.R. § 10.18(b). Under rule 10.18(b), the party presenting a paper certifies that all statements made are believed to be true and that the party shall be subject to criminal penalties for any knowingly and willfully false statements or representations. The amended rules allow the PTAB to impose sanctions on an attorney that violates this rule and provides a procedure for the opposing party to file a motion for sanctions.
In J.P. Morgan Chase v. Intellectual Ventures (CBM2014-00157), the PTAB held that a patent owner cannot remove the standing of a petitioner in a covered business method (CBM) patent review, and therefore halt the CBM review entirely, by disclaiming all CBM claims after the review has been instituted.
In PPC Broadband Inc. v. Corning Optical Commc’ns, Docket No. 2015-1364 (Fec. Cir. 2016), the Federal Circuit strongly relied on the intrinsic evidence of the specification to limit the Patent and Trial Appeal Board’s broadest reasonable interpretation of a term at issue. During the instituted inter partes review (IPR) of US Patent 8,323,060, the PTAB construction of the term “reside around” resulted in a meaning of “in the immediate vicinity of; near”. Id. at p. 5. As a result of this interpretation, the PTAB determined that the claims at issue reciting this term were obvious. Reviewing the claims de novo (based on intrinsic evidence) and its factual determinations (based on extrinsic) for substantial evidence per In re Sullivan, 498 F.3d. 1345, 1350 (Fed. Cir. 2007), the Court remanded the IPR proceedings for further proceedings.