Posts Tagged: "PTAB"

On January 3, 2017 the Court of Appeals for the Federal Circuit (the court) handed down two decisions relating to obviousness under § 103 – In re: Marcel Van Os, Freddy Allen Anzures, Scott Forstall, Greg Christie, Imran Chaudhri, No. 2015-1975 (Fed. Cir. 2017) (Van Os) and In re: Ethicon, Inc., No. 2015-1696 (Fed. Cir. 2017) (Ethicon). In Van Os, the Appellants appealed a decision from the Patent Trial and Appeal Board (PTAB) affirming the Examiner’s rejection of the claims of U.S. Patent Application No. 12/364,470 under § 103. The court addressed the question of whether the PTAB properly held that the claims were obvious in light of prior art. The court vacated and remanded. In Ethicon, the Appellant appealed a decision from the PTAB affirming, in a merged inter partes reexamination, the Examiner’s rejection of the claims of U.S. patent 7,591,844 (the ’844 patent) under § 103. The court addressed the question of whether the PTAB properly affirmed the rejection of the claims of the ’844 patent under § 103. The court affirmed. These two cases raise several interesting questions, especially given that they were decided on the same day.

If you are having trouble figuring out how Zond could have had 371 claims, lost all of them, but only 1,220 claims were instituted out of 1,377 claims challenged, you understand the problem. These are not misprints or mistakes. Zond had 371 unique patent claims, but because of the IPR gang tackling phenomena those 371 claims were challenged a total of 1,377 times, but instituted only 1,220 times. Thus, the number of institutions is more than three times the number of unique claims Zond owned. In other words, the institution rate shouldn’t have been 88.6%, it should have been closer to 329%!

Patent claims being adjudicated valid in federal district court and then being killed in an administrative proceeding at the PTAB is exactly the problem so many of us saw coming. Time and time again throughout the debates in Congress, and all through the legislative history, post grant proceedings were explained as being a faster, low-cost alternative to litigating validity disputes in Federal District Court. That was just a lie. Post grant proceedings at the PTAB are not cheap, and they are not an alternative to district court proceedings. The PTAB is duplicative and anti-patent. In fact, because of the different standards used between district courts and the PTAB, and because district courts presume patents are valid pursuant to 35 U.S.C. 282, different outcomes are practically inevitable.

The Federal Circuit noted that precedent requires a prior art reference to disclose the invention without modification in order to anticipate. “[A] prior art reference that must be distorted from its obvious design does not anticipate a patent claim.” The Court applied that principle here and found that the first reference (Rambert) would only anticipate if one of its elements was removed. The Board failed to explain the removal of that element. The second reference (Bouttens) also required “significant and impermissible modification,” which was also unexplained. Consequently, the Board’s conclusions were not supported by substantial evidence.

“In our time together today we are going to try and take stock of the health of the American patent system,” Michel began. “It is important to remember that the patent system was founded in the Constitution… and although the world ‘right’ appears many times in the Bill of Rights, in the original Constitution the only ‘right’ mentioned is the patent right.”… Investment is being disincentivized by uncertainty created by the aforementioned three waves of changes to the system. We should be looking at the impact on the flow of money, Michel explained.

Anticipation can arise when the disclosure of a limited number of alternative combinations discloses the one that is claimed. However, a reference does not anticipate because an artisan would immediately envision a missing limitation… In Kennametal, the challenged claim required a ruthenium binding agent and a PVD coating to be used together. The prior art reference disclosed five binding agents (including ruthenium) and three coating techniques (including PVD), and taught that any binding agents could be used with any coatings. Thus, Kennametal held that the reference effectively taught fifteen combinations, one of which anticipated the challenged claim. A limited number of possible combinations effectively disclosed one of them. Kennametal does not hold that a reference can anticipate a claim if a skilled artisan would “at once envisage” the missing limitation. As a result, the Court reversed the Board’s finding of anticipation.

As of March 17, 2017, the Federal Circuit has remanded 23 post-grant proceedings back to the Patent Trial and Appeal Board (PTAB) for further consideration. But there are no rules governing remands: no deadlines and no set procedures. Even the Trial Practice Guide is silent. To shed some light on how the PTAB is handling remands, we analyzed these cases in detail and have spotted a few notable trends. We first provide some general statistics about appeals from post-grant proceedings to the Federal Circuit. We then discuss the types of issues remanded and discuss how the PTAB is handling them. Finally, we provide some practical takeaways.

In a surprisingly restrained decision, the Patent Trial and Appeal Board (PTAB) released a decision denying institution of a covered business method (CBM) review proceeding on a patent that is tangentially related to financial activity… Ford alleged that its claim was further supported by the ‘080 patent’s description of market regions for which the consolidated models could be constructed. “The configuration process/system claimed in the ‘080 patent is at least ‘incidental to’ or ‘complementary to’ a financial activity, such as the sale of automobiles,” Ford’s petition reads.

Michael Meiresonne (“Meiresonne”) appealed from the final inter partes review (“IPR”) decision of the U.S. Patent Trial and Appeal Board (“Board”). The Board held that certain claims of the underlying patent were unpatentable as obvious… The Court stated that neither prior art reference said or implied that combining their teachings, especially for the “rollover viewing area” would be “‘unreliable,’ ‘misleading,’ ‘wrong,’ or ‘inaccurate,’ and which might lead one of ordinary skill in the art to discard” the combination. Thus, the references did not discourage a person of ordinary skill in the art from making the combination.

The PTAB held that anticipation can be found even when a prior art reference does not disclose each and every claim element as long as one of skill in the relevant art would “at once envisage” the claimed arrangement, citing Kennametal, Inc. v. Ingersoll Cutting Tool Co., 780 F.3d 1376, 1381 (Fed. Cir. 2015). The Federal Circuit explained the PTAB fundamentally misinterpreted and misapplied the Court’s holding in Kennametal… For there to be anticipation each and every element must be present, period. Close is not the same and PTAB judges should know that.

While there are many fixes that need to happen to bring about even a modicum of fairness and justice to the PTAB processes, the most important fix that must occur is a change to the law that recognizes a quieting of title for patents. Serial challenges against the same patent must end, period… If a party challenges a patent in a post grant proceeding notice should be provided to the industry, such as through the Patent Office Gazette and/or other mechanisms, providing any and all interested parties the ability to similarly file a challenge against the same patent with a certain number of days – perhaps 90 days or maybe 120 days. Then once the time period for challenges has run the PTAB can determine which claims to institute, if any, and the case can proceed.

Each of the Covidien IPRs challenged the validity of a single patent owned by the University of Florida Research Foundation (UFRF) which the university had previously asserted against Covidien. The decisions made by the ALJs in these IPRs indicate that public research universities can find protection from review proceedings at PTAB by claiming rights afforded them by the Eleventh Amendment of the U.S. Constitution… In their final written decision, the PTAB ALJs note that deciding this case based on UFRF’s Eleventh Amendment defense could have wide-reaching implications for the future of validity challenges to patents held by public university research arms or “a monetization foundation affiliated with a state university.”

A panel of administrative patent judges (APJs) at the Patent Trial and Appeal Board (PTAB) issued a final written decision ending a series of inter partes review (IPR) proceedings targeting patents covering a popular multiple sclerosis (MS) treatment developed and sold by Ardsley, NY-based Acorda Therapeutics (NASDAQ:ACOR). The decision strengthens the patent portfolio covering Acorda’s Ampyra pharmaceutical even as competition from generic manufacturers has ramped up in recent months. The IPRs, instituted after petitions from the Kyle Bass-backed Coalition for Affordable Drugs (ADORCA), targeted four patents listed in the U.S. Food and Drug Administration’s (FDA) Orange Book.

LAB sued Eli Lilly & Company, alleging marketing of the drug Cialis induced infringement of LAB’s patent. Eli Lilly subsequently requested that the Board conduct inter partes review of the patent. The Board agreed to do so and ultimately found the patent to be obvious in light of three prior art references… The Court then found the Board’s construction of certain claim terms to be overly broad, stating the Board’s construction “would make the patent claims applicable to individuals with erectile dysfunction not caused by penile fibrosis.”

The § 101 rejection rate for patent applications in the e-commerce work groups approaches 100%, then drops precipitously for the remaining seven of the top ten work groups with the greatest percentage of § 101 rejections. Before Bilski, the § 101 rejection rate in the e-commerce work groups hovered around around the 30% mark, but has now tripled. The remaining work groups have also seen their § 101 rejection rates rise by 200-300%, although they make up a significantly smaller proportion of total rejections than in the e-commerce art units. While it did not surprise us that these work groups were at the very top of the list for § 101 rejections, we also wanted to know what other technologies are particularly prone to § 101 rejections.