emerging trends and legal developments in post-grant ...go.bio.org/rs/490-ehz-999/images/session 5 -...

Emerging Trends and Legal Developments

in Post-Grant Proceedings

March 28, 2017

Attorney Advertising

WilmerHale

Overview

2

Trends for TC1600/Orange Book Patents

Legal Developments

– Scope of Estoppel

– Joinder

– Motions To Amend

– What is reviewable by the Federal Circuit?

– Standing to Appeal

– Sovereign Immunity

– Section 101 Creep

WilmerHale

IPR Petitions – Technology Breakdown

3

As of January 31, 2017.Source: https://www.uspto.gov/sites/default/files/documents/aia_statistics_january2017.pdf

WilmerHale

IPR Petitions

4

37 8

14 17

5

18

41

27

3932

41

5360

35

54 51

32

0

10

20

30

40

50

60

70

Sep

-12

Oct

-De

c-1

2

Jan

-Mar

-13

Ap

r-Ju

n-1

3

Jul-

Sep

t-1

3

Oct

-De

c-1

3

Jan

-Mar

-14

Ap

r-Ju

n-1

4

Jul-

Sep

t-1

4

Oct

-De

c-1

4

Jan

-Mar

-15

Ap

r-Ju

n-1

5

Jul-

Sep

t-1

5

Oct

-De

c-1

5

Jan

-Mar

-16

Ap

r-Ju

n-1

6

Jul-

Sep

t-1

6

Oct

-No

v-1

6

TC1600 IPRS Filed by Quarter

1779 94

137204

267

190

458395

458395

466418

375335

416439448

0

100

200

300

400

500

Sep

-12

Oct

-De

c-1

2

Jan

-Mar

-13

Ap

r-Ju

n-1

3

Jul-

Sep

t-1

3

Oct

-De

c-1

3

Jan

-Mar

-14

Ap

r-Ju

n-1

4

Jul-

Sep

t-1

4

Oct

-De

c-1

4

Jan

-Mar

-15

Ap

r-Ju

n-1

5

Jul-

Sep

t-1

5

Oct

-De

c-1

5

Jan

-Mar

-16

Ap

r-Ju

n-1

6

Jul-

Sep

t-1

6

Oct

-No

v-1

6

IPRS Filed by Quarter

As of January 18, 2017.

WilmerHale

IPR Institutions – Technology Breakdown

5


Source: https://www.uspto.gov/sites/default/files/documents/aia_statistics_january2017.pdf

WilmerHale

IPR Institutions

6

92%

84%89%

86%

78% 79%82%

76%

69%73% 75%

69%65%

51%56%

72%

80%

100%

89% 88%

100%

57% 59%

46%

57%54%

43%

63%

41%

49%52%

93%

0%

20%

40%

60%

80%

100%

120%

Institution Rates

Institution Rates All IPRs Institution Rates TC1600


* Of decisions that have reached an institution decision.

WilmerHale

IPR Outcomes – Technology Breakdown

7


Source: https://www.uspto.gov/sites/default/files/documents/aia_statistics_january2017.pdf

WilmerHale

Petitions – Orange Book Patents

8

As of February 23, 2017.

0 50 100 150 200 250

Method of Treatment

Formulation/Composition

Compound

234

182

63

Types of Orange Book Patents Petitioned

WilmerHale

Institution Decisions – Orange Book Patents

9


0 10 20 30 40 50 60 70

Method of Treatment

Formulation/Composition

Compound

68

52

19

Types of Orange Book PatentsDenied Petitions

WilmerHale

Outcomes – Orange Book Patents

10


348 Petitions Total

39 Decisions Awaiting

Institution

34 Terminated by Agreement

Pre-Institution

96 Not Instituted

179 Instituted

Of Decisions Instituted

26 Settled

3 Requested Adverse

Judgment

77 Proceeded to Final Written Decision

• 43 All Instituted Claims Unpatentable

• 2 Some Instituted Claims Unpatentable

• 32 All Instituted Claims Not Unpatentable

WilmerHale

Outcomes – Orange Book Patents

11

0

5

10

15

20

25

30

35

Formulation Method Compound

Final Decisions by Type of Patent

Not Unpatentable All Unpatentable Some Claims Unpatentable

As of March 21, 2017.

WilmerHale


https://www.uspto.gov/sites/default/files/documents/20170302_PPAC_PTAB_Update.pdf

Preliminary Response Rates: Pre and Post Rule to Allow

New Testimonial Evidence (NTE)

12

WilmerHale

IPRs – Legal Developments

Scope of Estoppel

Joinder

Motions To Amend

What is reviewable by the Federal Circuit?

Standing to Appeal

Sovereign Immunity

Section 101 Creep

13

WilmerHale

IPRs – Scope of Estoppel

The petitioner in an inter partes review of a claim in a patent

under this chapter that results in a final written decision. . .

may not request or maintain a proceeding before the Office

with respect to that claim on any ground that the petitioner

raised or reasonably could have raised during that inter

partes review. 35 U.S.C. § 315(e)

Shaw Indus. Grp. Inc., v. Automated Creel Sys., Inc.

– Plain language of the statute prohibits the application of

estoppel when a party raises a ground in its petition for IPR

that is then denied and no IPR is instituted on that ground.

14

WilmerHale

Petitioned: 1. SDB

2. DB 3. QC

Instituted:

1. SDB

Estopped: 2. DB

Not

Estopped:

3. QC

Verinata Health v. Ariosa Diagnostics

Ariosa IPR Petitions:

(1) obviousness over the combined

teachings of Dhallan and

Binladen; (“DB”)


teachings of Quake and Craig; (“QC”)


teachings of Shoemaker, Dhallan, and

Binladen. (“SDB”)

The PTAB instituted IPR on only the

third ground. (“SDB”)

Before the district court:


teachings of Dhallan and

Binladen; and (“DB”)


teachings of Quake and Craig. (“QC”)

15

WilmerHale


Only arguments raised during IPR are subject

to estoppel.

– However, if the grounds denied as redundant cite a subset of

the references on which the petition was instituted, the

petitioner could have raised them in the IPR and is

therefore estopped. See Verinata, at 7.

– If the final IPR decision is based on a “technicality,” whether a

particular reference can be considered prior art, estoppel

applies even though the PTAB never specifically compared

the reference with the patent in its final decision. See Verinata,

at 9.

16

WilmerHale

Parallel Networks Licensing, LLC v.

Int’l Business Machines Corp.

In August 2015, IBM filed

four IPR petitions.

IPR was instituted on all four

grounds, but IBM ultimately

failed to prove the claims

were unpatentable.

Before the District of

Delaware IBM sought to

invalidate claims based on

prior art combinations of

which it was aware before it

filed the IPR petitions.

17

Petitioned: 1, 2, 3, 4

Instituted:

1, 2, 3, 4,

Estopped:

1,2,3,4

Not

Petitioned,

Estopped:

5 and 6.

WilmerHale

“The PTAB has recognized that estoppel under

§ 315(e) is broad, and that the prior art references (or

combinations) a petitioner ‘could have raised’ includes

any references that were known to the petitioner or

that could reasonably have been discovered by ‘a

skilled searcher conducting a diligent search.’”

Citing Apotex v. Wyeth, IPR2015-00873 at *6.

18

Joinder and Scope of Estoppel



WilmerHale

Inconsistent Standards for Estoppel?

Two standards:

Narrow: Raised before

the PTAB, but not

instituted – not barred

by estoppel

Broad: Not raised before

the PTAB, but aware of –

barred by estoppel.

19

Petitioned: 1. SDB

2. DB 3. QC

Instituted:

1. SDB

Estopped: 2. DB

Not

Estopped:

3. QC

Estopped:

4. YZ

(not in

petition but

known)

WilmerHale

Joinder

“If the Director institutes an inter partes review, the

Director, in his or her discretion, may join as a party to

that inter partes review any person who properly files a

petition under section 311 that the Director, after

receiving a preliminary response under section 313 or

the expiration of the time for filing such a response,

determines warrants the institution of an inter parties

review under section 314.” 35 U.S.C. § 315(c)

20

WilmerHale


April 24, 2015, Roche filed separate IPR petition

challenging patent.

The same day, Roche also tried to join Ariosa’s IPR

in which Roche had been named a real

party-in-interest.

PTAB denied the motion as untimely and denied

institution of Roche’s own IPR as a “belated, and

essentially, second attempt to raise” duplicative

grounds against the same patent.

21

WilmerHale


Court held the Roche was estopped from raising

arguments Ariosa raised or reasonably could have

raised in Ariosa’s IPR.

Estoppel applies equally to a real party-in-interest or

privy of the petitioner.

Nothing more need be shown beyond “literal status

as a real party-in-interest” for estoppel to apply.

– Court need not determine whether the real party-in-interest

had a realistic opportunity to influence the IPR petition.

22

WilmerHale



The court rejected IBM’s argument that because it

joined a petition brought by Microsoft on identical

grounds, it would have been unreasonable for it to

have raised any invalidity argument not presented in

the Microsoft IPR. 13-2072 (KAJ), slip. Op. at 25 (D. Del, Feb

22, 2017).

There is no “mirror image” rule for joinder. Id. at 26.

Joinder can involve petitions that assert different

grounds of invalidity.

23

WilmerHale

Motions to Amend

Patent owners are allowed to move to amend claims

during an IPR under 37 C.F.R. § 42.121.

– A motion to amend will only be granted if the patentee also

demonstrates that the proposed amendments would make

the claims patentable over the known prior art.

24

WilmerHale

A History of Motions to Amend

“The burden is on the patent owner to show a patentable

distinction over the prior art of record and also prior art known

to the patent owner.”

– Idle Free Systems, Inc. v. Bergstrom, Inc. (PTAB 2013).

– Microsoft Corporation v. Proxyconn, Inc. (Fed. Cir. 2015).

A patent owner need not identify how amendments are

patentable over all prior art, but only over the

“prior art of record.”

– MasterImage 3d, Inc. v. RealD Inc. (PTAB 2015).

– Nike v. Adidas (Fed. Cir. 2016).

“The purpose of [the] post-grant review [system] is not to stack

the deck against the patentee, but to achieve a correct and

reliable result.”

– Prilotec Inc. v. Scentair Technologies, Inc. (Fed. Cir. 2015)

(J. Newman, dissenting).

25

WilmerHale

Motions to Amend - Veritas v. Veeam

On August 30, 2016, the CAFC vacated the denial of

Veritas’ motion to amend its claims.

PTAB denied Veritas’ motion because Veritas had not discussed whether

each newly added feature was separately known in the prior art, but instead

discussed “the newly added feature in combination with other

known features.” 835 F.3d 1406, 1411 (Fed. Cir. 2016).

CAFC vacated the Board’s denial of motion to amend as arbitrary and

capricious: “We do not see how the Board could reasonably demand more

from Veritas in this case.” Id. at 1414.

“We fail to see how describing the combination is meaningfully different from

describing what is new about the proposed claims, even in comparison to the

unamended claims.” Id. at 1415.

The Board’s rationale is erroneous regardless of the outcome of the In re

Aqua Products pending en banc decision. Id.

26

WilmerHale

Motions to Amend - In re Aqua Products

CAFC granted en banc review to consider two questions

When the patent owner moves to amend its claims under 35

U.S.C. § 316(d), may the PTO require the patent owner to

bear the burden of persuasion, or a burden of production,

regarding patentability of the amended claims as a condition

of allowing them? Which burdens are permitted under 35

U.S.C. § 316(e)? 833 F.3d 1335, 1336 (Fed. Cir. 2016).

When the petitioner does not challenge the patentability of a

proposed amended claim, or the Board thinks the challenge

is inadequate, may the Board sua sponte raise patentability

challenges to such a claim? If so, where would the burden of

persuasion, or a burden of production, lie? Id.

27

WilmerHale

What is judicially reviewable?

AIA bars judicial review of a decision to

institute a review.– Cuozzo Speed Techs., LLC v. Lee, (2016).

But will judicial review be available to challenge a

PTO determination that petitioner satisfied

timeliness requirement?– Overturning Achates?

– Wi-Fi One LLC v. Broadcom Corp. (2017)*

28

* WilmerHale represents Broadcom

WilmerHale


Cuozzo Speed Techs., LLC v. Lee

“The determination by the Director whether to institute an inter

partes review under this section shall be final and

nonappealable.” 35 U.S.C. § 314(d).

“[O]ur 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.”

– “[W]e need not, and do not, decide the precise effect of §

314(d) on appeals that implicate constitutional questions,

that depend on other less closely related statutes, or that

present other questions of interpretation that reach, in terms

of scope and impact, well beyond ‘this section.’”

29

WilmerHale


Wi-Fi One LLC v. Broadcom Corp.

“35 U.S.C. § 314(d) prohibits this court from

reviewing the Board's determination to initiate IPR

proceedings based on its assessment of the time-

bar of § 315(b)”

– Achates Reference Publ’g Inc. v. Apple, (Fed. Cir. 2015).

“Wi–Fi does not dispute that Achates renders its

challenge to the Board's timeliness ruling

nonappealable if Achates is still good law.”

– “What Wi–Fi argues is that the Supreme Court's recent

decision in Cuozzo Speed Technologies, implicitly

overruled Achates.”

– Wi-Fi One LLC v. Broadcom Corp. (Fed. Cir. 2016).

30

WilmerHale



Petition for rehearing en banc by Wi-Fi One was

granted on a single issue:

Should this court overrule Achates and hold that

judicial review is available for a patent owner to

challenge the PTO's determination that the

petitioner satisfied the timeliness requirement of 35

U.S.C. § 315(b) governing the filing of petitions for

inter partes review?

31

WilmerHale



Wi-Fi One’s Position:

Absent a clear expression of Congressional intent, courts must read the

statutes to permit judicial review of the process by which the Board made an

institution decision (even if the decision itself is unreviewable), and to permit

challenges asserting the agency exceeded the scope of its statutory

jurisdiction, acted contrary to a statutory command, or otherwise acted

contrary to law.

Broadcom’s Position:

By its plain terms, 35 U.S.C. § 314(d) prohibits appeals of the Board’s

determination whether to institute an inter partes review. The Board’s

conclusion that a petitioner is not time-barred under § 315(b) is a central

aspect of the institution determination and thus falls well within the scope of §

314(d). The Supreme Court’s decision in Cuozzo only bolsters that conclusion.

Cuozzo held that § 314(d), at a minimum, bars challenges that are closely tied

to the application and interpretation of statutes related to the Patent Office’s

decision to initiate inter partes review. § 315(b) is just such a statute.

32

WilmerHale

Standing to Appeal

To appeal a decision of the PTAB, a party must establish a

concrete and particularized injury in fact from the

adverse decision.

– Phigenix, Inc. v. Immunogen, Inc., (Fed. Cir. 2017).

Injury in fact:

Must be concrete. . .

– The harm must actually exist or appear imminent.

– A conjectural or hypothetical injury will not suffice.

. . . and particularized.

– Will affect an appellant in a personal and individual way.

Phigenix failed to substantiate its alleged injury in fact.

Submitted two declarations that asserted only that it suffered actual

economic injury because Immunogen’s patent increased competition.

33

WilmerHale

Sovereign Immunity

Covidien v. Univ. Fla. Research Found. Inc.

“On the whole, considering the nature of inter partes review and civil

litigation, we conclude that the considerable resemblance between

the two is sufficient to implicate the immunity afforded to the States

by the Eleventh Amendment.”

Further, we note that there are several similarities between civil

litigation and inter partes review that are not unlike those compared

in Vas-Cath for interferences.

– “The manner of discovery, adversarial nature of the proceeding, role

of the APJ, and the applicability of the Federal Rules of Evidence in

an inter partes review largely mirrors that involved in an

interference proceeding.”

34

* WilmerHale represented Covidien

WilmerHale

Section 101 “Creep”

Nidec Motor Corp. v. Zhongshan Broad

Ocean Motor Co. Ltd.

The Board held that anticipation can be

found even when a prior art reference

fails to disclose a claim element so long

as a skilled artisan reading the reference

would “at once envisage” the claimed

arrangement. Citing Kennametal Inc. v.

Ingersoll Cutting Tool Co.,

(Fed. Cir. 2015).

“Kennametal does not stand for the

proposition that a reference missing a

limitation can anticipate a claim if a

skilled artisan viewing the reference

would ‘at once envisage’ the

missing limitation.”

35

“Kennametal does not permit the

Board to fill in missing limitations

simply because a skilled artisan

would immediately envision them.”

WilmerHale

Other 2016 IPR Decisions of Note:

Burden of Proof in IPR Proceedings– The burden of proof in an IPR proceeding after institution

remains with the petitioner.

In re Magnum Oil Tools Int’l, Ltd. (Fed. Cir. 2016).

IPR Claim Construction– Claim terms in an IPR are to be given their broadest

reasonable interpretation.

Cuozzo Speed Techs., LLC v. Lee (2016).

Standard of Review– AIA requires the “substantial evidence” standard of review.

Merck & Cie v. Gnosis SpA (Fed. Cir. 2016).

36

WilmerHale

Questions?

37

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keep recipients advised of all legal developments. Prior results do not guarantee a similar outcome. © 2015 Wilmer Cutler Pickering Hale and Dorr LLP

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