Posts Tagged: "motion to amend"

The Patent Trial and Appeal Board (PTAB) recently issued its first-ever preliminary guidance on motions to amend claims filed by patent owner Sanofi and, although the substituted claims haven’t escaped an obviousness challenge from Mylan, patent owners might be able to use that guidance as a roadmap for their own motions to amend claims. In other PTAB decisions between October 1 and 16, USAA escaped covered business method (CBM) reviews based on the technological invention exclusion, NHK Spring factors led the PTAB to deny two inter partes reviews (IPRs) petitioned against TRUSTID patents, oral hearings were held in Apple’s IPRs against Qualcomm, despite the patent settlement agreement between the two firms, and NuCurrent failed to avoid Samsung IPRs after arguing issue preclusion based on district court litigation of a forum selection clause in a contract between the two companies.

Federal Circuit issued a Rule 36 summary judgment in Chart Trading Development, LLC v. Interactive Brokers LLC, affirming the invalidation of patent claims owned by Chart Trading in covered business method (CBM) proceedings instituted at the Patent Trial and Appeal Board (PTAB). In issuing the summary affirmance of the PTAB, the Federal Circuit panel of Circuit Judges Pauline Newman, S. Jay Plager and Kimberly Moore declined the opportunity to comment on Chart Trading’s arguments on the PTAB’s alleged due process violations by changing the construction of a key term in its final written decision… If the government can award a franchise and that franchise can be taken away in a manner that violates the APA, what is the point in seeking the government franchise in the first place? If the Court charged with making sure the agency that strips government franchises is following the rules is going to decide cases of such importance with only one word — Affirmed — one has to question whether a government franchise is at all a worthwhile pursuit.

Director Iancu: ‘For the sake of predictability and reliability, the boundaries of a patent should not depend on which forum happens to analyze it. People who want to invest in a patented technology, or who want to invent or design around one, should be able to determine, within reason, what that patent means. Objectively speaking, that meaning cannot, and should not, depend on the happenstance on which forum might review the patent, years after issuance. The rule change, therefore, increases the predictability of our patent system.’

The United States Patent and Trademark Office (USPTO) has published a Request for Comments (RFC) about a proposed procedure for motions to amend filed in inter partes reviews, post-grant reviews, and covered business method patent reviews (collectively AIA trials) before the Patent Trial and Appeal Board (PTAB).  In essence, the proposal includes:  providing the parties with the Board’s initial assessment of the proposed amendment early in the process; providing meaningful opportunity to revise, and oppose, proposed amendments; and ensuring that the amendment process concludes within the 12-month statutory timeline. The proposal is based upon six years of experience conducting AIA trials during which time more than 350 motions to amend have been filed.

Due to the recent decision in Aqua Products v. Matal, 872 F.3d 1290 (Fed. Cir. 2017), the Court disagreed with the Board’s decision to deny Bosch’s motion to amend. The Board noted in its final decision that it was “unpersuaded that Bosch had demonstrated that the proposed substitute claims are patentable.” However, under Aqua Products, the patent owner does not bear the burden of proof for the patentability of its proposed amended claims in an IPR proceeding. Rather, the petitioner must prove by a preponderance of the evidence that the proposed amended claims are unpatentable. The Board therefore impermissibly assigned the burden of proof to Bosch.

It is that time once again when we look back on the previous year in preparation to close the final chapter of 2017 in order move fresh into the year ahead. 2017 was a busy year in the patent world, although change was not as cataclysmic as it had been in past years, such as 2012 when the PTAB and post grant challenges began, in 2013 when AIA first to file rules went into effect, or in 2014 when the Supreme Court decided Alice v. CLS Bank. It was, nevertheless, still an interesting year… To come up with the list below I’ve reviewed all of our patent articles, and have come up with these top 10 patent stories for 2017. They appear in chronological order as they happened throughout the year.

On November 21, 2017, the USPTO’s Chief Administrative Patent Judge David P. Ruschke issued a memorandum to the Patent Trial and Appeal Board (PTAB) providing guidance on motions to amend claims during trial proceedings before the PTAB. This was done in light of the Federal Circuit’s en banc decision in Aqua Products, Inc. v. Matal, 872 F.3d 1290 (Fed. Cir. 2017) on October 4, 2017… Judge Ruschke has reversed the PTAB’s practice of placing the burden of persuasion on the patent owner rather than the inter partes review (IPR) petitioner: “In light of the Aqua Products decision, the Board will not place the burden of persuasion on a patent owner with respect to the patentability of substitute claims presented in a motion to amend,” the Ruschke memo reads.

The industry reaction to Aqua Products v. Matal has been swift. In IPWatchdog’s Industry Roundup blog post, there was broad acclaim. However, for those involved with post-grant proceedings before the AIA, however, Aqua Products at most means a return to the amending regime allowed under the previous inter partes post-grant procedure, inter partes reexaminations. Given that IPRs were explicitly designed to extend and amend the previous inter partes reexamination procedures, a comparison of amendment practice under the two procedures makes a number of lessons clear.

More than six months have passed since the en banc rehearing in Aqua Products without a decision from the Federal Circuit. It could be an indication that the court is working on handing down a ruling that would greatly alter PTAB practices relating to motions to amend. In the alternative, it could be an indication that there’s a split in opinion and Federal Circuit is still making up its mind on the matter with multiple separate opinions being prepared and circulated. Interestingly, an article on In re: Aqua Products published last August by The National Law Review noted that, in its decision to grant Aqua’s petition for en banc rehearing, the Federal Circuit asked an additional question of law: who holds the burden for persuading PTAB or producing evidence to challenge the patentability of claims amended by a patent owner. That by itself could be an indication that Federal Circuit is interested in ruling in favor of patent owners in this case.

When the America Invents Act (AIA) was being formulated, from about 2005 – 2011, nothing was more subject to change bill-to-bill than the proposed “1st look” and “2nd look” procedures for issued US patents. Should the U.S. have a regular opposition procedure, or should existing inter partes reexam just be tweaked? The AIA final result is the universally dis-liked post grant troika known as PGR, IPR, and CBM… For today I will confine my remarks (and associated fixes) to three truly bad ideas that in practice have played out as particularly egregious. More specifically: (1) the lack of standing required for inter partes review (IPR) challenges; (2) the lack of any real ability to amend claims during a post grant proceeding; and (3) the trivially low threshold (i.e., reasonable likelihood) that initiates an IPR.

Overall, a significant number of the eleven judges present for argument hinted through their questioning that they thought the PTO’s rulemaking was problematic…. The PTO’s position is that the burden of proof allocated by § 316(e) is not applicable to motions to amend and therefore it may regulate the burden of proof on such motions based on the authority granted to it in § 316(a)(9). Judge Reyna jumped in almost immediately during the PTO’s argument to question the validity of the PTO’s rulemaking. In his view, there is no validly promulgated PTO regulation that places the burden of persuasion for motions to amend on the patent owner.

On December 9, 2016, the en banc Federal Circuit will hear argument in In re Aqua Products, Inc. on an issue that has long been troubling patent owners involved in inter partes reviews (“IPR”)—the difficulty of amending patent claims before the Patent Trial and Appeal Board (“PTAB”)… The Federal Circuit granted a petition for rehearing en banc to consider whether the burden of persuasion allocated to the patentee by the PTAB for motions to amend is permissible under the statutory scheme.[5] Notably, the Federal Circuit’s rehearing order specifically identifies 35 U.S.C. § 316(e), which provides that in an IPR “the petitioner,” not the patent owner, “shall have the burden of proving a proposition of unpatentability by a preponderance of the evidence.” The Federal Circuit also will consider whether the PTAB can raise sua sponte challenges to patentability, much the way an examiner would, if the IPR petitioner fails to do so.

The enumerated problems with the post grant procedures could be bettered by both the courts and the USPTO. The courts have had an opportunity to change the standard for claim construction in the post grant procedures but have declined. However, the USPTO can ameliorate the problem itself by providing for more liberal leave to amend. The rationale for BRI at the USPTO is that patentee can amend at the Office but not in court. The Office can more easily allow for claims that are further limiting and this would greatly reduce the problem.

In the final decision by the Board in the IPR, the Board denied the patent owner’s motion solely because the patent owner did not discuss whether each newly added feature was separately known in the prior art. The Board concluded that the motion and the declaration of Veritas’s expert, Dr. Levy, was insufficient because it did not discuss the features separately but discuss only the newly added feature in combination with other known features. The Federal Circuit found that denying the motion to amend for this reason alone was unreasonable and, therefore, the decision of the Board had to be set aside as being arbitrary and capricious.