Apple Inc. v. California Institute of Technology, Appeal Nos. 2019-1580, -1581 (Fed. Cir., March 5, 2020).

In January of this year, a jury awarded the California Institute of Technology (Caltech) $837,801,178 for Apple’s infringement of three patents. One of those patents was U.S. Patent No. 7,116,710. The ‘710 patent claimed methods of encoding a

Wasica Finance GmbH et al. v. Schrader Int’l, Inc. et al., C.A. 13-1353-LPS (D. Del. January 14, 2020) (publicly available on January 21, 2020).

Plaintiffs Wasica and Bluearc (collectively “Wasica”) filed an infringement action based on U.S. Patent No. 5,602,524 against defendants (collectively “Schrader”). The patent pertained to devices for measuring the air pressure in tires.
Continue Reading IPR Estoppel Strikes Again

Arthrex, Inc. v. Smith & Nephew, Inc., Appeal No. 2018-2140 (Fed. Cir., October 31, 2019)

Since the inception of inter partes review at the Patent Trial and Appeals Board (PTAB), there have been a number of constitutional challenges to these type of proceedings.  This latest challenge concerned the very formation of the PTAB itself.

Continue Reading The PTAB and the Constitution

A bipartisan group of Senators and Representatives recently released a framework for amending Section 101.  The group includes Senator Chris Coons (D-Del.) and Senator Thom Tillis (R-N.C.), as well as Representative Doug Collins (R-Ga.), Representative Hank Johnson (D-Ga.) and Representative Steve Stivers (R-Ohio).  As Senator Coons stated in a press release:
Continue Reading Recent Proposal for Section 101 Reform

All patent practitioners recognize that a single prior art reference can be used to reject claims in an obviousness rejection. However, the issue is whether the Patent Office must provide additional evidence, above and beyond the sole prior art reference, when using common sense to conclude the invention is obvious. Recently, the Federal Circuit held that the Board misapplied the law on the permissible use of common sense in an obviousness analysis. Arendi S.A.R.L. v. Apple Inc., No. 2015-2073, 2016BL258032, 5 (Fed. Cir. Aug. 10, 2016).

The Arendi case began as an IPR petition filed December 2, 2013 by Apple Inc., Google, Inc., and Motorola Mobility LLC claiming U.S. Patent No. 7,917,843 (the ‘843 Patent), owned by Arendi S.A.R.L., was invalid as obvious. The IPR was instituted and the Board issued an opinion on June 9, 2015 finding the claims unpatentable as obvious. On appeal, the Federal Circuit reverses the Board.

As described by the patent owner, the “’843 Patent is directed, among other things, to computer-implemented processes for automating a user’s interaction between a first application, such as a word processing application or spreadsheet application, on the one hand, and a second application, such as contact management application having a database, on the other.” IPR2014-00208, Paper 6 page 1. The sole prior art reference used to invalidate the ‘843 Patent as obvious was U.S. Patent No. 5,859,636 (“Pandit”). Pandit taught recognizing different classes of text in a document and providing suggestions based on it.

The Federal Circuit acknowledged that there is a place for common sense, common wisdom, and common knowledge in the obviousness analysis. However, Judge O’Malley provides three caveats when applying common sense in these instances.

First, common sense is acceptable to use to provide a motivation to combine, not to supply a missing claim limitation. O’Malley noted the suggestion test described in Dystar. The suggestion test does not require that an explicit teaching to combine be found in a particular prior art reference, the motivation to combine “may be found in the knowledge of one of ordinary skill in the art, or, in some cases, from the nature of the problem to be solved. When not from the prior art references, the ‘evidence’ of motive will likely consist of an explanation of the well-known principle or problem-solving strategy to be applied.”. Dystar Textilfarben GmbH v. Patrick Co., 464 F.3d 1356, 1366 (Fed. Cir. 2006).  The Dystar decision further explained that an “implicit motivation to combine exists not only when a suggestion may be gleaned from the prior art as a whole, but when the ‘improvement’ is technology-independent and the combination of references results in a product or process that is more desirable, for example because it is stronger, cheaper, cleaner, faster, lighter, smaller, more durable, or more efficient…In such situations, the proper question is whether the ordinary artisan possesses knowledge and skills rendering him capable of combining the prior art references.” Id. at 1368.
Continue Reading When Can Common Sense be Relied Upon to Find an Invention Obvious?

Last week, the Supreme Court declined to make any changes to IPR procedure in its opinion in Cuozzo Speed Technologies, LLC v. Lee, 579 U.S. ___ (2016). Relying primarily on statutory language and concepts of agency rulemaking authority, the Court found no reason to alter the Federal Circuit’s interpretation of the “no appeal” provision of the patent act covering IPRs, or the patent office rule that the agency shall construe a claim according to its “broadest reasonable construction” during IPR. In doing so, the Court did not foreclose the possibility of other challenges to actions by the PTAB, whether constitutional or based on the manner in which the PTAB exercised its authority. For now, however, it is largely business as usual at the PTAB.

The case arose out of an IPR instituted on certain claims of a patent owned by Cuozzo (“Cuozzo Patent”). The original petitioner sought IPR on all 20 claims of the Cuozzo Patent. One of the grounds for review set forth the petition was that dependent claim 17 was obvious under §103. The PTAB instituted review of claim 17 on the §103 ground articulated in the petition, but also decided to include claims 10 and 14 in its review on the same obviousness ground as claim 17. As noted by the PTAB, claim 17 depended from claims 14 and 10, and a challenge to claim 17 implicitly raised the same challenge to claims 14 and 10. Thus, the PTAB decided to institute IPR on claims 10, 14, and 17, despite the fact that petitioner only specifically challenged claim 17 on the obviousness ground that ultimately was the basis of instituting the IPR.

During the course of IPR, the PTAB issued a final decision, in which it construed the claim terms at issue with the “broadest reasonable” construction. Cuozzo also sought to amend the claims, which the PTAB rejected, finding that the proposed amendments failed to satisfy 35 U.S.C. §112 and would have impermissibly broadened the scope of the claim language.

Cuozzo appealed the PTAB’s decision to institute review of claims 10 and 14 on the grounds that petitioner failed to identify those claims with particularity as required by 35 U.S.C. §312(a)(3). Cuozzo also appealed the PTAB’s use of the “broadest reasonable interpretation” standard to construe claims in IPR, arguing that the Congressional intent of establishing IPR as a surrogate for litigation suggests that the claim construction standard employed during IPR should be consistent with the standard used in district court cases.

The Federal Circuit affirmed the decision to institute review of claims 10 and 14 of the Cuozzo Patent, noting that the “no appeal” provision of 35 U.S.C. §314(d) explicitly states that the decision whether to institute an IPR “shall be final and nonappealable.” The Federal Circuit reasoned that §314(d) precludes not only interlocutory appeal of the PTO’s decision to institute an IPR, but also appeal of the PTO’s decision to institute an IPR after a final decision from the Patent Trial and Appeal Board. In re Cuozzo Speed Technologies, LLC, 793 F.3d 1268, 1273 (Fed. Cir. 2015).

The Federal Circuit also held that the PTO reasonably required the PTAB in an IPR to construe claims according to their “broadest reasonable construction.” While noting that there is no express requirement in the patent statute about what specific claim construction standard should be used, the Federal Circuit reviewed the judicially approved history of use of this standard in other PTO proceedings involving unexpired patents, and concluded that the PTO’s approach was a valid exercise of agency rulemaking authority.

The Supreme Court granted cert on both issues.

“No Appeal” Means “No Appeal” – Absent Shenanigans, That Is
Justice Breyer, writing for the majority, affirmed the Federal Circuit’s determination and held that §314(d)’s “no appeal” provision precluded appellate review of a decision to institute an IPR. The majority held that the plain language of §314(d) clearly set forth Congress’ intent to preclude such judicial review of a decision to institute. Any other interpretation of §314(d), the majority reasoned, “would undercut one important congressional objective, namely, giving the Patent Office significant power to revisit and revise earlier patent grants.” Cuozzo, 579 U.S. at ___ (slip op., at 8).

In making its holding, the majority “emphasize[d] that our interpretation applies where the grounds for attacking the decision to institute inter partes review consist of questions that are closely tied to the application and interpretation of statutes related to the Patent Office’s decision to initiate inter partes review.” Id. (slip op., at 11). Applying this interpretation, the majority held that Cuozzo’s challenge of the PTAB’s determination was closely tied to its determination that the information presented in the petition warranted review under §314(a).

The majority, however, did not interpret §314(d)’s “no appeal” provision to completely foreclose all judicial review of decisions to institute an IPR. In particular, the majority noted that judicial review of PTO decisions to institute an IPR would be warranted where the PTO’s decisions “implicate constitutional questions, [] depend on other less closely related statutes, or [] present other questions of interpretation that reach, in terms of scope and impact, well beyond ‘this section.’” Id. (slip op., at 11). Such questions could be reviewed under the Administrative Procedure Act (APA), which allows courts to “set aside agency action that is contrary to constitutional right, in excess of statutory jurisdiction, or arbitrary and capricious.” Id. (slip op., at 12).

Justice Alito, along with Justice Sotomayor, dissented from the majority’s holding, arguing that the “strong presumption favoring judicial review of administrative action” precluded the majority’s broad reading of §314(d)’s “no appeal” provision. Id. (slip op., at 3, Alito, J., dissenting). Noting that Congress could have employed “far more unambiguous and comprehensive” language precluding judicial review in §314(d), Justice Alito concluded that §314(d) should be read to only preclude interlocutory appeal of the PTO’s determination to institute an IPR. Id. (slip op., at 5, Alito, J., dissenting). While this interpretation would allow for judicial review of the PTO’s determination to institute an IPR after a final determination, Justice Alito confirmed that “normal limits on judicial review still apply” – noting that “errors that do not cause a patent owner prejudice” or errors that are “superseded by later developments” may not warrant relief and thus do not warrant disposal of the PTO’s determination. Id. (slip op., at 9-10, Alito, J., dissenting).

The majority rejected the arguments in Justice Alito’s dissent, finding the plain language of §314(d) to be consistent with preserving “the agency’s primacy over its core statutory function in accord with Congress’ intent.” Id. (slip op., at 10). The majority noted that the APA still provided an avenue to seek judicial review of the PTO’s determination.

Despite the differences in interpretation between the majority and dissent, both opinions recognize that judicial review is appropriate where the PTO engages in “shenanigans” – such as exceeding its statutory authority by canceling a patent claim for indefiniteness under §112 in inter partes review. Id. (slip op., at 11 and slip op., Alito., J., dissenting at 12-13). Under the majority opinion, however, it is questionable whether anything short of “shenanigans” by the PTAB in a decision to institute could be subject to judicial review, nor is it entirely clear what might be considered appealable shenanigans.

“Broadest Reasonable” Is Reasonable
While noting that the patent statute does not unambiguously direct the PTO to use one claim construction standard or another, the majority also noted that the statute does expressly authorize the PTO to issue rules governing IPR. Id. (slip op., at 13). The “broadest reasonable construction” regulation is one such rule. Id.
Continue Reading Status Quo At The PTAB For Now: Supreme Court makes no changes to IPR Practice

The Federal Circuit affirmed the PTAB’s final determination in Genzyme Therapeutic Products Limited Partnership v. Biomarin Pharmaceutical Inc., Nos. 2015-1720, 2015-1721 (Fed. Cir. June 14, 2016), holding that the PTAB did not violate the Administrative Procedure Act (APA) by relying upon prior art references not identified in the grounds on which the PTAB instituted review.  In particular, the Federal Circuit held that the PTAB properly relied upon those references to establish the state of the art at the time of invention of the claimed invention.

The patents at issue are Genzyme’s U.S. Patent Nos. 7,351,410 (“the ’410 patent”) and 7,655,226 (“the ’226 patent”), which are directed towards the treatment of Pompe disease. Pompe disease is a genetic condition that results in a deficiency or absence of a certain enzyme, acid alpha glucosidase (“GAA”), that is used to break down glycogen.  The inability to break down glycogen in the body causes the glycogen to accumulate in a patient’s heart and skeletal muscles, causing progressive deterioration and ultimate failure of those muscles.  Pompe’s disease can be treated by injecting GAA with mannose-6-phosphate (“M-6-P”) into patients, causing GAA to be taken up in heart and skeletal muscles with M-6-P receptors.

Biomarin filed two IPR petitions challenging the validity of Genzyme’s ’410 and ’226 patents. The PTAB instituted review of the ’410 and ’226 patents on grounds that the claims were invalid as obvious in view of the prior art. In its patent owner responses, Genzyme argued that the claims of the ’410 and ’226 patents were not obvious because each of the prior art references were directed towards in vitro experiments, and that there was no evidence that a person of ordinary skill would have a reasonable expectation of success applying those experiments in a human.  In its reply, Biomarin challenged Genzyme’s non-obviousness argument and identified two references in response – van der Ploeg ’91 and Kikuchi – showing successful in vivo tests administering GAA.  The van der Ploeg ’91 and Kikuchi references were not identified in the instituted grounds for review.

The PTAB found the challenged claims of the ’410 and ’226 invalid as obvious. In particular, the PTAB found that a person of ordinary skill could have arrived at the claimed inventions through “routine optimization” of the prior art.  In reaching this conclusion, the PTAB relied upon the Kikuchi and van der Ploeg ’91 references to establish the state of the art regarding in vivo studies.

Genzyme challenged the PTAB’s final determination, inter alia, on the grounds that the PTAB “relied on ‘facts and legal arguments’ that were not set forth in the institution decisions.” Id. (slip op., at 7).  In particular, Genzyme took issue with the fact that the PTAB’s final determination relied on the Kikuchi and van der Ploeg ’91 references to establish obviousness without providing notice of those specific references in its institution decision.  In Genzyme’s view, the PTAB improperly “change[d] theories in midstream,” thereby depriving Genzyme of notice and an opportunity to be heard as required by the APA. Id. (slip op., at 7-8).

On appeal, the Federal Circuit rejected Genzyme’s argument, holding that Genzyme had actual notice of the Kikuchi and van der Ploeg ’91 references and had an opportunity to be heard with regards to those references.
Continue Reading PTAB Can Rely Upon Prior Art Not Cited in an IPR Institution Decision to Establish the State of Art

Two recent cases show that simply avoiding a post-grant review proceeding at the U.S. Patent Office’s Patent Trial and Appeal Board (PTAB) not only does not preclude a defendant in underlying patent infringement litigation in a federal district court from raising the same invalidity arguments again, it also may not even influence the court’s claim construction. Moreover, the patent owner may not be allowed to make reference to its prior success in avoiding an administrative trial at the Patent Office as well.

Although 35 U.S.C. § 315(e)(2) provides an estoppel binding on a petitioner (or any party in privity with the petitioner) from raising the same issue in federal court patent infringement litigation if they lose in a PTAB final written decision, it is increasingly clear that a PTAB decision not to institute a trial is not likely to carry much weigh in federal court.

In Adidas AG v. Under Armour Inc. et al, C.A. No. 14-130, slip op. (D. Del. Dec. 15, 2015), the District Court of Delaware denied a defendants’ motion to modify the court’s claim construction order based on a PTAB decision denying institution of an inter partes review (IPR). The patent at issue covers “location aware” fitness trackers, which Addidas has alleged are infringed by Under Armour’s fitness and exercise monitoring systems. Even though Under Armour didn’t get a trial initiated on the Addidas patent at the PTAB, it did like the way the board construed the claims and urged Judge Sleet of the Delaware federal district court to adopt the same construction.

The Delaware District Court declined to change its construction of the term “with respect to a route path.”  Judge Sleet noted in a footnote that the “PTAB’s choice not to institute an IPR is not the type of adjudication that leads to issue preclusion.” The order further noted that the PTAB had not reached a final decision on the claim construction and consequently, the Court “is not bound by a preliminary claim construction used by the PTAB for the limited purpose of denying an IPR request.”
Continue Reading A Decision Not to Institute a Trial at the PTAB Does Not Carry Much Weight in Federal Court