On Monday, November 27, 2017, the Supreme Court heard oral arguments in SAS Institute v. Matal.

Issue presented

Whether 35 U.S.C. § 318(a) requires that the Patent Trial and Appeal Board (PTAB or Board) issue a final written decision as to every claim challenged by a petitioner, or does it allow the Board to issue a final written decision with respect to the patentability of only some of the patent claims challenged by the petitioner.

Background

On September 14, 2012, ComplementSoft sued SAS in the Northern District of Illinois for infringement of U.S. Patent No. 7,110,936.  On March 29, 2013, SAS filed a petition with the PTAB for inter partes review (IPR) of the ‘936 Patent, challenging patentability of all 16 claims of that patent.  The PTAB instituted IPR as to 9 claims (1 and 3-10) of the ‘936 patent and on August 6, 2014 issued a final written decision under 35 U.S.C. § 318(a), holding that claim 4 was not invalid over prior art, whereas claims 1-3 and 5-10 were unpatentable.  SAS’ request for rehearing before the Board was denied.  On June 10, 2016, the 2-1 divided Panel of the Federal Circuit Rejected SAS’s argument that the Board must address all claims challenged in an IPR petition in its final written decision, and affirmed the PTAB’s decision, except vacated with respect to claim 4.   The Panel consisted of Judges Stoll, Chen, and Newman, with Judge Newman dissenting in part.  As Judge Stoll stated, there is “no statutory requirement that the Board’s final decision address every claim raised in a petition for inter partes review.  Section 318(a) only requires the Board to address claims as to which review was granted.” The Federal Circuit reasoned that 35 U.S.C. § 314  and 35 U.S.C. § 318(a) are different and that § 318(a) “does not foreclose the claim-by-claim approach the Board adopted [in Synopsys] and in this case.” In a dissenting opinion, Judge Newman stated that 35 U.S.C. § 314(a) required USPTO either refuse to institute IPR entirely, or to review all challenged claims when “there is a reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims challenged in the petition.”

Continue Reading SAS v. Matal – Overview of Oral Arguments in the Supreme Court

On November 21st, the PTAB issued guidance on motions to amend based on the Federal Circuit’s en banc decision in Aqua Products, Inc. v. Matal, 872 F.3d 1290 (Fed. Cir. 2017). In view of the Aqua Products decision, the PTAB will not place the burden of persuasion on the patent owner with respect to the patentability of substitute claims presented in a motion to amend. Instead, after the patent owner files a motion to amend, the Board will determine whether the substitute claims are unpatentable by a preponderance of the evidence based on the entirety of the record, including the opposition by the petitioner.

Continue Reading PTAB Guidance on Motions to Amend in View of Aqua Products

In Vecco Instruments Inc. v. SGL Carbon, LLC, No. 17-CV-2217 (E.D.N.Y. Nov. 2, 2017), Judge Pamela Chen in the Eastern District of New York recently granted Vecco’s motion for a preliminary injunction enjoining SGL Carbon. The requested injunction sought to prevent SGL Carbon’s further actions related to its likely indirect infringement of Vecco’s asserted patents. Notable in this extensive and detailed 76-page decision is the Court’s discussion of how “long-term and second-order” effects of the accused infringer’s actions can satisfy the “irreparable harm” requirement of the preliminary injunction analysis.

Plaintiff Vecco designs, manufactures, and services LEDs, power electronics, hard drives, and other electronic devices.  It also owns patents related to metal-organic chemical vapor deposition (MOCVD) reactors, a technology that enables high-volume fabrication of metal-organic semiconductor wafers that can be turned into LEDs. Vecco enjoys a large share of the MOCVD market due, in large part, to a distinctive feature of its MOCVD reactors: a removable wafer carrier, typically made of graphite that is mounted on a spindle centrally positioned within the reactor. Vecco authorized SGL Carbon to manufacture these wafer carriers for Vecco and its customers, but in 2013, SGL Carbon began manufacturing wafer carrier for a new entrant into the MOCVD market. Vecco claims this constituted infringement of its MOCVD patents, and sought a preliminary injunction to stop this activity during the pendency of the patent litigation case.

Continue Reading Potential Future Harm to Patent Holder Found to Justify Imposition of Preliminary Injunction

In a precedential opinion issued on October 11, 2017, the United States Court of Appeals for the Federal Circuit reversed the Patent Trial and Appeals Board’s (“PTAB”) finding of non-obviousness where the prior art taught away from some, but not all, of the embodiments covered by the challenged claims.  In Owens Corning v. Fast Felt Corp., No. 2016-2613 (Fed. Cir. Oct. 11, 2017), the panel held that the PTAB had applied an unreasonably narrow construction to the exclusion of embodiments that were not taught away from by prior combinations disclosing all of the claim elements.

PTAB’s Improper Claim Construction

Fast Felt owns U.S. Patent No. 8,137,757 (“the ‘757 patent”), which it asserted against Owens Corning in the U.S. District Court for the Northern District of Ohio.  In turn, Owens Corning petitioned for inter partes review of the claims of ‘757 patent, and the PTAB instituted trial.  Owens Corning contended that the challenged claims were rendered obvious by prior art combinations disclosing all elements of the independent claims.  However, in its final written decision, the Board determined that Owens Corning failed to provide a motivation to combine and upheld the patentability of the challenged claims. Owens Corning timely appealed.

Continue Reading Federal Circuit Clarifies the Requirements for a Teaching Away by the Prior Art

The United States Court of Appeals for the Federal Circuit’s recent decision in Aqua Products Inc., v. Matal materially changes the burden of proof associated with the patentability of amended claims during an inter partes review (“IPR”), shifting the burden from the Patent Owner seeking the amendment to the IPR Petitioner opposing it.

Prior to the Aqua decision, if a Patent Owner sought to amend claims during an IPR, the Patent Trial and Appeals Board (the “Board”) placed the burden on the Patent Owner to prove that the proposed amended claims were patentable.  When Patent Owner Aqua attempted to amend its claims during an IPR challenge to its U.S. Patent No. 8,273,183, the Board found that Aqua had not met its burden and denied Aqua’s motion to amend.

Continue Reading AQUA PRODUCTS: The Federal Circuit Shifts The Burden of Proof On Amending Claims During An IPR From The Patent Owner To The Petitioner

The Federal Circuit yesterday issued an opinion in In re: Smith Int’l, Inc., No. 2016-2303 (Fed. Cir. Sept. 26, 2017) reversing an affirmance by the Patent Trial and Appeal Board of the rejection of several claims of U.S. Patent No. 6,732,817 being challenged in ex parte reexamination.  In so doing, the Court held the Board’s construction of “body” in the ’817 Patent claims to be unreasonable as inconsistent with the specification.

The ’817 Patent concerns a downhole drilling tool for oil and gas operations.  In affirming the examiner, the Board found it “perfectly reasonable” to interpret the “body” of the tool as encompassing other components because neither the claims nor the specification explicitly limit the scope of the term.  Even though the specification describes the body as separate from other elements, the Board reasoned that it doesn’t expressly define “body” or otherwise preclude the examiner’s interpretation.  But according to Smith, the ’817 Patent consistently refers to and depicts the body as a component distinct from other components of the drilling tool – like the “mandrel” or “piston” located inside the drilling tool – and should be interpreted simply as an “outer housing.”

Continue Reading “In Light of the Specification”: Federal Circuit Weighs in on the Broadest Reasonable Interpretation

After an eight-year battle through the Federal Courts, the fight over attorneys’ fees in Octane Fitness v. ICON Health & Fitness has likely reached its end with the Federal Circuit upholding the hotly disputed $1.6 million award to Defendant Octane Fitness. This case previously made it up to the Supreme Court, which overturned the Federal Circuit’s prior standard for determining exceptional cases under 35 U.S.C. § 285. Following a remand to the District Court applying the new totality-of-the-circumstances test established by the Supreme Court, the parties again appealed to the Federal Circuit.

Continue Reading Octane Fitness Hits the Showers: Federal Circuit Affirms Attorneys’ Fees Award in Landmark Case

Last week, the Federal Circuit held computer memory system patent claims not abstract and thus patent-eligible under Section 101, reversing a lower court dismissal of the case under Rule 12(b)(6).  Visual Memory LLC v. NVIDIA Corp., No. 2016-2254, 2017 U.S. App. LEXIS 15187 (Fed. Cir. Aug. 15, 2017).

U.S. Patent No. 5,953,740 (“the ‘740 patent”) describes a memory system that can be tailored for use with multiple different processors without reducing performance.  Id. at 3.  The ‘740 patent explains that when “the [memory] system is turned on, information about the type of processor is used to self-configure the programmable operational characteristics.”  Visual Memory, No. 2016-2254, slip op. at 4.  “For example, depending on the type of processor, internal cache 16 can store both code and noncode data, or it can store only code data.”  Id. at 4.  Claim 1 recites the following:

Continue Reading In a Reversal, Federal Circuit Finds Data Processing Claims Patent-Eligible Under Section 101 in Visual Memory v. NVIDIA

On July 20, 2017, the United States Court of Appeals for the Federal Circuit in In re OptumInsight denied OptumInsight’s petition for writ of mandamus on privilege waiver. The court held that the District Court for the Northern District of California did not clearly abuse its discretion in evaluating the proper scope of waiver.

The ‘897 patent reexamination. In June 1994, Symmetry Health Data Systems, Inc. (Symmetry) responded to a request for proposal (RFP) from Aetna Life Insurance Co. and offered to license its healthcare analytics software, Symmetry Episode Treatment Group (ETG) Program, to Aetna. More than a year later, Symmetry filed a patent application that claims and describes the ETG Program. During prosecution, Symmetry did not disclose its RFP response regarding the software license to the patent office. Symmetry’s application eventually issued as U.S. Patent No. 5,835,897.

Continue Reading Federal Circuit Says PTO Submissions Can Waive Privilege to Future Communications

On July 17, 2017, the United States Court of Appeals for the Federal Circuit reversed, in a precedential opinion in Millennium Pharmaceuticals, Inc. v. Sandoz, Inc., No. 2015-2066 (Fed. Cir. July 17, 2017), a district court ruling that claims of a patent directed to the Velcade® cancer treatment drug compound were invalid as obvious. The Court held that the District of Delaware clearly erred by finding U.S. Patent No. 6,713,446 (the ‘446 patent) prima facie obvious to one of skill in the art, and by misapplying the secondary indicia of unexpected success and long-unmet need.

Continue Reading Federal Circuit Thoroughly Reverses District Court Findings of Velcade® Patent Obviousness