PTAB Issues Representative Order Clarifying Motion To Amend Analysis In Idle Free Systems

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Yesterday the Patent Trial and Appeal Board ("Board") added a recent order to its list of Representative Orders, Decisions, and Notices. See MasterImage 3D, Inc. v. RealD Inc., IPR2015-00040, Paper 42 (PTAB July 15, 2015).
United States Intellectual Property

Yesterday the Patent Trial and Appeal Board ("Board") added a recent order to its list of Representative Orders, Decisions, and Notices.  See MasterImage 3D, Inc. v. RealD Inc., IPR2015-00040, Paper 42 (PTAB July 15, 2015).  The Representative Order in MasterImage concerns motions to amend and elaborates on the Patent Owner's burden to set forth a prima facie case of patentability of narrower substitute claims in a motion to amend as originally set forth in Idle Free Systems, Inc. v Bergstrom, Inc., IPR2012-00027, Paper 26 (PTAB June 11, 2013).

The panel in Idle Free indicated that a patent owner must show that its proposed substitute claims are patentably distinct over the "prior art of record" and "prior art know to the patent owner."  Id. at 7.  In MasterImage, the Board issued an order clarifying the meaning of both phrases.  MasterImage at 4.  The MasterImage panel explained that "prior art of record" refers to any material art (i) in the prosecution history of the challenged patent, (ii) in the current proceeding (including art asserted in grounds on which the Board did not institute review) and (iii) in any other proceeding before the Office involving the challenged patent.  Id. at 1.

The Board further held that "prior art known to the patent owner" "should be understood as no more than the material prior art that the Patent Owner makes of record in the current proceeding pursuant to its duty of candor and good faith to the Office under 37 C.F.R. § 42.11, in light of a Motion to Amend."  Id. at 2.  According to the panel, a patent owner should focus its patentability analysis on the limitation(s) that each new claim adds to the original claim(s):  "Because a proposed substitute claim is considered after the corresponding patent claim is determined unpatentable, Patent Owner's addition of a limitation to render the claim as a whole patentable places the focus, initially, on the added limitation itself."  Id.  The Board noted that information relating to one or more added limitations can still be "material" even if it isn't directed to one or more of the elements of the original claims.  Id. (citing VMWare, Inc. v. Clouding Corp., Case IPR2014-01292, slip op. at 2 (PTAB Apr. 7, 2015) (Paper 23)).

The Representative Order concluded by reinforcing that even though the burden of production shifts to the petitioner following a patent owner's prima face case of patentability, the ultimate burden of persuasion remains with the patent owner to demonstrate the patentability of the substitute claims.  Id. at 3.

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