United States: Board Decision Grants Motion To Amend With Respect To One Substitute Claim And Denies Motion To Amend With Respect To Other Substitute Claim

Last Updated: October 30 2017
Article by Kate Nuehring Su

The Board's recent decision in Veeam Software Corp. v. Veritas Technologies, LLC, Case No. IPR2014-00090 (PTAB July 17, 2017), provides patent practitioners with a framework for analyzing proposed substitute claims.  The Board's decision, granting patent owner's motion to amend in part, should be considered in conjunction with the Federal Circuit's decision in Veritas Technologies LLC v. Veeam Software Corp., 835 F.3d 1406 (Fed. Cir. 2016), which vacated the Board's earlier disposition of the IPR and remanded the case to the Board to reconsider the substitute claims it previously denied.  These decisions offer at least a partial framework by which the PTAB may assess motions to amend during inter partes reviews.

The patent challenged in the IPR is directed to systems and methods for restoring data from backup storage while applications are active and accessing the data being restored.  After the PTAB instituted the IPR, the patent owner filed a conditional motion to amend to add new claims.  After rejecting all challenged claims as obvious, the Board denied the patent owner's motion to amend.  The Board reasoned that patent owner had not addressed whether each newly added feature in each proposed claim was independently known in the prior art.  The Board concluded that testimony by the patent owner's expert regarding the newly added features in combination with other known features was not sufficient for it to grant the motion to amend.

On appeal, the Federal Circuit upheld the Board's obviousness decision.  However, the court determined that the Board's denial of the motion was arbitrary and capricious.  The court pointed out that a long line of Supreme Court and Federal Circuit cases note that "novel and nonobvious inventions often are only a combination of known individual features."  There being no meaningful difference here, according to the court, in "describing the combination," as the patent owner's motion does, and in "describing what is new in the proposed claims," as the Board required, the court vacated portion of the Board's decision denying the motion and remanded the matter for the Board to properly determine whether the proposed substitute claims are patentable.

On remand, the Board allowed the patent owner to supplement its motion to amend.  The patent owner modified one of the previously proposed substitute claims to specify that a computer-accessible medium was "non-transitory."  The Board then articulated the framework used to evaluate proposed amendments.  First, the Board identified the limitations that differentiated the proposed substitute claims from the respective originally patented claims upon which they were based.  Next, for each limitation, the Board determined whether the limitation introduced new matter in violation of 35 U.S.C. §316(d)(3).  The Board examined whether the limitation had written description support as required by 35 U.S.C. §112(a).  If it did not, the Board concluded that the limitation did not comply with 35 U.S.C. §316(d)(3), and no further analysis was undertaken with respect to that limitation.

In the case of one of the two proposed claims, the Board concluded that one of more of its newly added limitations introduced new matter in violation of Section 316(d)(3).  For the other, however, the Board found no such defect.  The Board next reviewed the claim for indefiniteness, concluding that the claim phrase was not indefinite.  After that, the Board examined the claim with respect to the requirements of 35 U.S.C. §102 and §103, and concluded that the identified prior art references lacked certain features of the claim and that a person of ordinary skill in the art would not have modified the references to arrive at the claimed invention.  Lastly, the Board addressed whether the proposed claims were permissible under 37 C.F.R. §42.12(a)(2)(i), which provides that motions to amend may be denied where the "amendment does not respond to a ground of unpatentability involved in the trial." The petitioner had argued that the amendment to include "non-transitory" was made to overcome objections under 35 U.S.C. §101—a ground of unpatentability that could not have been part of the inter partes review.  In addressing the requirements of Section 42.12(a)(2)(i), the Board announced that it "do[es] not view the requirement to be that every word added to or removed from a claim in a motion to amend must be solely for the purpose of overcoming an instituted ground."  Accordingly, the proposed amendment to introduce the "non-transitory" language was permissible and, thus, the claim Board granted the motion with respect to this claim.

Patent practitioners can take a few lessons for drafting substitute claims from this decision.  First, the novelty of any substitute claim may rely merely on a new combination of known individual features.  Second, modifications to address potential 35 U.S.C. §101 or §112 issues are permissible so long as other aspects of the claim are designed to overcome an instituted ground.  Finally, as the Board noted toward the end of its decision, the proper way to revise the dependency of other claims is to propose substitute claims that are duplicates of the originally patented dependent claims.  These lessons are further important in the wake of the Federal Circuit's October 2017 en banc decision in Aqua Products Inc. v. Matal, which is forcing the PTAB to re-think the procedure by which parties present substitute claims and the procedural framework for the PTAB's review of those claims.

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.

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