United States: Federal Circuit Sanctions PTO's Authority To Institute IPR On A Claim-By-Claim Basis In Synopsis v. Mentor Graphics

Last Updated: February 23 2016
Article by George C. Beck

In Synopsys, Inc. v. Mentor Graphics Corp., a split panel of the Federal Circuit found "that there is no statutory requirement that the Board's final decision address every claim raised in a petition for inter partes review." Appeal Nos. 2014-1516, 2014-1530, slip op. at 12 (Feb. 10, 2016). The panel majority held that 35 U.S.C. § 318(a) only requires the Board to address claims as to which review was granted.

The decision arose from Synopsis's petition for inter partes review (IPR) of claims of a patent owned by Mentor relating to a method for tracing bugs in the design of computer chips. The Board instituted review as to some claims, but found that there was no reasonable likelihood of invalidity as to others. The Board ultimately issued a final written decision finding some of the claims subject to IPR to be anticipated but finding others not proven to be invalid.

Synopsys argued that because § 318 directs the Board to issue a final written decision with respect to "any patent claim challenged by the petitioner," the final written decision must address every claim raised in the petition. Id. at 8. The panel majority disagreed, finding that § 318(a) permits the Board to institute on a claim-by-claim basis. Id. at 8-10. The panel majority additionally found that the Board's practice is authorized by 37 C.F.R. § 42.108. Id. at 10-11.

Synopsis additionally appealed the substance of the Board's findings that some of the claims addressed in the Board's final written decision were not proven anticipated. Among other grounds, Synopsis argued that the Board improperly required it to present expert testimony. The court rejected this argument. Referring first to district court cases, the court observed that while expert testimony is not required, when the technology is complex and "beyond the comprehension of laypersons" expert testimony is sometimes essential. Id. at 18-19, quoting Centricut, LLC v. Esab Grp., Inc. 390 F.3d 1361, 1369 (Fed. Cir. 2004). In the context of IPR proceedings, the court acknowledged that the expertise of Board members may make it easier to understand and soundly explain the teachings and suggestion of the prior art without expert assistance. Id. at 19, citing Belden Inc. v. Berk-Tek LLC, 805 F.3d 1064, 1079 (Fed. Cir. 2015). On the other hand, as observed by the court, "the Board is not precluded from finding that the technology in a particular case is sufficiently complex that expert testimony is essential for a petitioner to meet his burden of proving unpatentability. Id.

In any event, the court found that the Board did not actually require Synopsis to provide expert testimony, but rather noted that Mentor did so, while Synopsis did not. The court found no error by the Board in giving substantial weight to this fact given the complexity of the technology. Id. at 24.
Synopsis additionally argued that the Board erred in failing to find that a particular limitation of the challenged claims was obvious over the prior art. The court, however, observed that the Board rejected the argument as being raised for the first time in Synopsis's reply and not responsive to arguments made in Mentor's response. The court agreed with the Board that Synopsis failed to properly raise this argument in its petition. Id. at 21-22.

Mentor cross-appealed the Board's denial of Mentor's motion to amend its claims. The Board denied the motion on two grounds. First, the Board found that Mentor failed to show that the amended claims would not have been obvious over one reference asserted in the IPR. Second the Board found that Mentor had not shown general patentability over the prior art. Relying on its prior decisions in Microsoft Corp. v. Proxyconn, Inc., 789 F. 3d 1292, 1303-08 (Fed. Cir. 2015) and Prilotec, Inc. v. ScentAir Techs.., Inc., 807 F.3d 1353, 1363 (Fed. Cir. 2015), the court found the Board's first narrower holding to be sufficient. Notably, the court declined to address whether the Board properly could require the patent owner to prove patentability more generally as to the "prior art."

In a lengthy dissent, Judge Newman took issue with the majority's holding that the Board may issue a final written decision addressing only some of the claims challenged in the petition. The dissent noted that § 318(a) mandates that the Board "shall issue a final written decision with respect to the patentability of any patent claim challenged by the petitioner and any new claim added under section 316(d)." The dissent further contended that no Chevron deference should be accorded to PTO Rule 42.108(a) because it is not in accordance with the plan language of the statute.

Judge Newman further took issue with the Board's practice of having Board judges render decisions to institute. Citing to her recent dissent in Ethicon Endo-Surgery, Inc. v. Covidien LP, No. 2014-1771 (Fed. Cir. Jan. 13, 2016), Judge Newman maintained her position that under the statute, the institution decision in an IPR is to be made by the Director, not by the Board. The dissent cites to AIPLA comments on the PTO's trial proceedings, which allege that having the decision to institute and a final decision decided by the same Board judges "creates an actual or perceived bias against the patent owner.

The Federal Circuit's decision in Synopsis is notable in several respects:

First, the decision affirms the Board's discretion to address only certain claims upon which it institutes trial. If the dissent's interpretation were accepted, it would require the Board to address all claims challenged in the petition even if it only found one of the claims to actually be likely shown invalid. Were the court to reverse the Board as to this practice, there would be a substantial risk that the trial phase would be expanded to a large number of issues that could not be adequately addressed given the statutory timeline for resolution of IPRs and the congestion in the Board's docket.

Second, in dictum, the panel decision indicates that claims not subject to institution are not subject to estoppel. Although Synopsis appealed the Board's refusal to issue a final decision as to claims it found unlikely to be proven unpatentable, it presumably found some comfort in the fact that the denial of institution would likely avoid estoppel. If the PTO does not find sufficient grounds to institute based on the evidence and arguments set forth in the petition, it would not seem favorable to the petitioner if the Board were to issue a final written decision based primarily on the petition addressing those claims.

Finally, the decision reaffirms the danger of failing to address fully all limitations of all challenged claims in the petition. While there is some possibility for a petitioner to address alleged shortcomings in the prior art in reply to a patent owner response, a petitioner runs a substantial risk of failing to meet its burden of demonstrating invalidity if the petition fails to demonstrate how each claim element is taught or suggested by the prior art.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.