The U.S. Patent and Trademark Office announced a proposed change to the standard for construing both unexpired and amended patent claims in Patent Trial and Appeal Board (PTAB) proceedings under the America Invents Act (“AIA”). The change would replace the current Broadest Reasonable Interpretation (“BRI”) standard with the standard articulated in Phillips v. AWH Corp. 415 F.3d 1303 (Fed. Cir. 2005) (en banc). This change would harmonize the claim construction standard applied in inter partes review, post-grant review, and covered business method patent proceedings before the PTAB with the one used by federal district courts and the International Trade Commission. The proposed amendment would also allow the PTAB to consider any prior claim construction determination concerning a term of the involved claim in a civil action, or an ITC proceeding, that is timely made of record in an AIA proceeding.
On Tuesday, the U.S. Supreme Court issued two important patent law opinions that relate to the inter partes review procedure introduced by the America Invents Act: Oil States Energy Servs., LLC v. Greene’s Energy Grp., LLC, which upholds the constitutionality of inter partes review, and SAS Institute, Inc. v. Iancu, which requires the Patent Trial and Appeal Board to adjudicate the validity all patent claims challenged in a petition for inter partes review if the Board decides to adjudicate the validity of any claim challenged in that petition. Yesterday, the PTO issued a memo describing how pending trials will be conducted and how new petitions will be addressed in light of SAS Institute, but important questions remain.
The Federal Circuit affirmed the Patent Trial and Appeal Board’s inter partes review decision declaring various claims of patent owner Thales’ U.S. Patent No. 6,474,159 (“the ‘159 patent”) nonobvious. In doing so, the Federal Circuit clarified what constitutes the substantial evidence required to sustain the Board’s factual findings on appeal.
When trying to overcome an obviousness rejection of a patent claim, an argument that two or more cited references cannot be combined may be used. For example, it can be argued that the combination is improper because the modification of a reference completely changes its “fundamental principle of operation.” However, it can be difficult to overcome obviousness rejections using this argument, which is highlighted in a recent Federal Circuit decision in University of Maryland v. Presens. In this case, the court affirmed an inter partes reexamination (IPR) decision of the Patent Trial and Appeal Board (PTAB) that affirmed the examiner’s rejection of claims in U.S. Patent 6,673,532 (“’532 patent) as obvious despite the plaintiff’s “changes the principle of operation” argument. Although the decision is non-precedential, it provides helpful information to patent practitioners and litigators for arguing obviousness based on changes to a reference’s fundamental principle of operation.
The ’532 patent discloses an optical method of monitoring various cell culture parameters. Claim 1 of the ’532 patent, deemed as representative, reads as follows: Continue Reading Overcoming Obviousness Rejections: Arguing Changes to Fundamental Principle of Operation
On December 19, 2017, an expanded panel of the Patent Trial and Appeal Board (PTAB) ruled that the state of Minnesota waived its Eleventh Amendment immunity to challenges to patent validity by inter partes review (IPR) by filing suit in federal court alleging infringement of the same patent being challenged by IPR. In Ericsson Inc. and Telefonaktiebolaget LM Ericsson v. Regents of the University of Minnesota (IPR2017-01186; IPR2017-01197; IPR2017-01200; IPR2017-01213; IPR2017-01214; IPR2017-01219), Petitioner Ericsson Inc. filed IPR petitions against five University of Minnesota patents covering wireless communications technology. In response, the University filed a motion to dismiss, arguing its Eleventh Amendment sovereign immunity exempted the patents from IPR challenge.
On Monday, November 27, 2017, the Supreme Court heard oral arguments in SAS Institute v. Matal.
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.
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.”
We first covered the Supreme Court’s grant of certiorari in Oil States Energy Servs., LLC v. Greene’s Energy Grp., LLC, 137 S. Ct. 2239 (2017), a case with the potential to substantially alter the patent litigation landscape, back in June. On Monday, November 27, 2017 the Court heard oral arguments on whether inter partes review – an adversarial process used by the Patent and Trademark Office (PTO) since September 16, 2012 to analyze the validity of existing patents – violates the Constitution by extinguishing private property rights through a non-Article III forum and without a jury.
Advocates and commentators on both sides of the argument weighed in extensively prior to Monday’s argument, culminating in almost 60 amicus curiae briefs, the most of any case this term. Parties urging the Court to reject Oil States’ argument included, for example, the Alliance of Automobile Manufacturers, GE, Apple, the Internet Association (which represents Amazon, Facebook and Google), and the current Solicitor General of the United States, Noel Francisco. On the other side, inventors, venture capitalists, law professors, the Pharmaceutical Research and Manufacturers of America, and the Biotechnology Innovation Organization, amongst others, urged the Justices to abolish inter partes review. Protesters, including some organized by websites such as www.usinventor.org, gathered outside the Court on Monday to support Oil States armed with signs stating “PTAB Kills American Dreams” and “Innovation: Don’t Kill it!”
Earlier this week, the United States Patent and Trademark Office (“USPTO”) published a new rule governing when privilege exists for communications between clients and their domestic or foreign patent attorneys and patent agents before the Patent Trial and Appeal Board (“PTAB”). For context, the originally proposed amendment sought to resolve ambiguity as to when privilege extends to USPTO patent practitioners during PTAB discovery proceedings in light of prior Federal Circuit, District Court and PTAB decisions. The now-published rule codifies the PTAB’s intent to protect communications between patent agents and clients from discovery, stating that:
“communication[s] between a client and a USPTO patent practitioner or a foreign patent practitioner that is reasonably necessary and incident to the scope of the patent practitioner’s authority shall receive the same protections of privilege under Federal law as if that communication were between a client and an attorney authorized to practice in the United States, including all limitations and exceptions[;]”
“USPTO patent practitioners and foreign jurisdiction patent practitioners shall receive the same treatment as attorneys on all issues affecting privilege or waiver, such as communications with employees or assistants of the practitioner and communications between multiple practitioners.”
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.
On September 6, 2017, an expanded panel of the Patent Trial and Appeal Board issued an “informative” decision in General Plastic Industrial Co., Ltd, v. Canon Kabushiki Kaisha setting forth the Board’s framework for analyzing follow-on inter partes review (IPR) petitions. In response to five concurrent requests for rehearing, a panel of seven administrative patent judges reviewed the factors articulated in NVIDIA Corp. v. Samsung Elec. Co., IPR2016-00134, Paper 9 (PTAB May 4, 2016) and, in doing so, denied all five requests. While acknowledging that multiple petitions challenging the same patent may be permitted based on specific facts of each case, the Board explained that follow-on petitions run the risk of undue inequities and prejudices to patent owners, and petitioner’s submission of multiple, staggered petitions constituted “an inefficient use of the inter partes review process and the Board’s resources.”