United States: A Rare Binding PTAB Decision: Guidance On Multiple Petitions

Last Updated: November 10 2017
Article by Jennifer Bush

The recent decision in General Plastic Industrial Co. v. Canon Kabushiki Kaisha denying the petitioner's requests for a rehearing provided a "baseline" of factors to be considered as to the limited circumstances when second — or "follow-on" — petitions are likely to be successful in Patent Trial and Appeal Board trials.

A recent decision denying the petitioner's requests for a rehearing provided a "baseline" of factors to be considered as to the limited circumstances when second — or "follow-on" — petitions are likely to be successful in Patent Trial and Appeal Board trials.

The petitioner in General Plastic filed two inter partes review petitions, each challenging one patent. The PTAB denied institution on the merits. The petitioner then sought rehearing, which was denied. The petitioner filed further petitions several months later with newly discovered art, challenging the same two patents based in part on the new references.

The decision, rendered by an "expanded" panel including Chief Judge David P. Ruschke, is significant both procedurally — because the decision was rendered by an expanded panel — and substantively — because it provided greater clarity to all parties in an area of PTAB trials processes that had previously been somewhat inconsistent, and recently was designated "precedential," a rare status indicating it is binding on future PTAB decisions unless replaced or undone.

To date, less than half of follow-on petitions have been instituted, showing the PTAB's reservations about them. However, there was great disparity in the prior PTAB decisions on this topic, including whether all seven factors laid out in NVIDIA v. Samsung Electronicswere addressed. The varied outcomes led commentators and practitioners alike to wonder whether initiation of a given follow-on petition was dependent on the particular panel drawn by petitioner.

Thus, the decision to render the decision via an expanded panel and label the case as precedential likely represents a recognition of the inconsistency of the PTAB decisions in follow-on petitions, and stands as a statement that the analysis in the General Plastic decision should be followed by the PTAB on a going-forward basis.

Substantively, the decision by the expanded panel describes how multiple challenges to the same patent will be evaluated. It made clear that the seven NVIDIA factors — which the PTAB stated should, at minimum, serve as a baseline moving forward — likely will limit the number of challenges that a patent ultimately goes through, which could be encouraging for patent owners.

The seven NVIDIA factors are:

  1. The finite resources of the PTAB;
  2. The requirement to issue a final determination not later than one year after institution;
  3. Whether the same petitioner previously filed a petition directed to the same claims of the same patent;
  4. Whether, at the time of the filing of the first petition, the petitioner knew or should have known of the prior art asserted in the later petition when it filed its earlier petition;
  5. Whether, at the time of filing of the later petition, the petitioner already received the patent owner's preliminary response to the first petition or received the PTAB's decision on whether to institute review in the earlier petition;
  6. The length of time that elapsed between when the petitioner learned of the prior art asserted in the second petition and the filing of the second petition; and
  7. Whether the petitioner provides adequate explanation for the time elapsed between the filing of multiple petitions directed to the same claims of the same patent.

The PTAB said, however, that "additional factors may arise" — essentially leaving open the door for panels to consider other factors outside the seven NVIDIA factors. In its decision denying the requests for rehearing, the Board noted that both 35 U.S.C. § 314(a) and § 325(d) made institution of review "discretionary." Indeed, the discretionary nature of the institution decision might be the reason the PTAB opted to leave open a door for such "additional factors," thereby allowing panels rendering future decisions to follow the guidance of General Plastic to the letter, while maintaining some discretion via possible additional factors not discussed in General Plastic.

However, the limits of the Board's discretion is being called to question in SAS Institute v. Lee, which the Supreme Court will hear this term, in which SAS argues that the USPTO cannot partially institute IPR proceedings, since 35 U.S.C. § 318(a) says the PTO "shall issue a final written decision with respect to the patentability of any patent claim challenged by the petitioner." In the past, the Board has taken its interpretation of its discretion to an extreme, e.g., in Shaw Industries Group v. Automated Creel Systems, arguing that the statute only articulates the negative of when the trial may not be instituted, but that institution is never compelled. If SAS prevails, however, the decision could impose new limits on the Board's discretion.

While the Board stated that the NVIDIA factors would serve as a "baseline" going forward, a few factors in particular stood out in the General Plastic decision as holding more weight than others. Factor 1, "PTAB resources," was articulated in the decision as: "the Board's resources would be more fairly expended on initial petitions, rather than follow-on petitions." If this is the way the PTAB is interpreting factor 1, it is likely to always weigh in favor of the patent owner, i.e., if the PTAB is favoring initial petitions over follow-on ones.

In addition, factors 5 and 7 seemed particularly important, as each addresses some aspect of the timing of the follow-on petition: whether a patent owner preliminary response and/or institution decision has been issued in the first petition, i.e., whether two and five months have elapsed, respectively, from the notice of a filing date (factor 5), and whether the petitioner has provided an adequate explanation of the time elapsed between petition filings (factor 7). Here, the second petitions were filed a few months after the institution decisions in the prior petitions and no adequate rationale was provided — so both of these weighed against the petitioner.

Factor 6 (time elapsed since knowledge of art in the second petition) seemed less important than did factor 4, as it was a relatively short timeframe that the art in the second petition actually was known to the petitioner, since it came from a prior art search performed after the institution decision in the first cases. However, there was no clear reason why the new art could not have been found/applied previously (i.e., it "should have" been known) — which weighed in the patent owner's favor for factor 4.

Takeaways and Implications

On the whole, the decision provides patent owners some comfort that no true "second bite at the apple" — i.e., a new petition challenging the same claims of the same patent after the PTAB has issued an institution decision — is likely to be allowed unless truly changed circumstances justify the second petition (factor 5). Considering the seven factors, such attempted "second bites" of this type likely would mean at least four factors (factors 1, 3, 5 and 6) — and possibly more — weigh in favor of denying institution. The expanded panel in General Plastic echoed this sentiment in cautioning against using a first institution decision as a road map for follow-on petitions, noting that second petitions are not a time for modifying challenges to cure the board-identified deficiencies of the prior petition.

Many commentators have pointed out that patent owners should be pleased with the decision. Although the expanded panel indicated that "there is no per se rule precluding the filing of follow-on petitions" and that "there may be circumstances where multiple petitions by the same petitioner against the same claims of a patent should be permitted," most read this language as followed by an implied "however": e.g., however, the institution of follow-on petitions is reserved for exceptional circumstances.

For petitioners, the expanded panel decision provides some clarity when seeking to file follow-on petitions — specifically, as to how to bolster their chances of success in getting them instituted. In particular, petitioners should attempt to file any follow-on petition before the institution decision is rendered in the first petition, and before the patent owner preliminary response if possible. Furthermore, petitioners need to articulate a strong rationale justifying any delay in filing the second petition.

What the General Plastic decision makes clear is that petitioners seeking a true "second bite at the apple" — in which a petitioner tries to remedy the shortcomings of the earlier petition, especially those noted by the PTAB in the institution decision in the first petition — are almost certain to be unsuccessful. This aspect alone should provide some comfort to patent owners who face challenges to their patent via PTAB trials, who previously were uncertain as to what limits existed for such challenges. Although it might seem limiting to petitioners, the General Plastic decision does provide guidance that will help prevent petitioners wasting time, cost and resources filing second petitions when they are almost certain to be unsuccessful.

The upcoming SAS case may shed light on whether the Board has been applying the right amount of discretion to its institution decision, including the application of the seven NVIDIA factors in General Plastic. By asking the Supreme Court to interpret 35 U.S.C. § 318(a), the SAS case will require the justices to interpret the language of the America Invents Act to determine what level of discretion the Board may apply. It seems likely that the absolute discretion that the Board has argued is not the correct standard, especially without explanation of the underlying rationale, for precisely the reasons Judge Moore cautioned against during oral arguments in Shaw, when she likened the Board's institution inconsistencies to throwing darts while blindfolded.

In particular, of the seven NVIDIA factors, the most problematic may be factor 1 (PTAB resources), since it seems to favor denial of institution without analysis beyond convenience for the PTAB. The one other AIA section noted by the Board that provides possible guidance as to second petitions is 35 U.S.C. § 325(d), which allows the Director to "reject the petition or request because, the same or substantially the same prior art or arguments previously were presented to the Office." This statue seems related to NVIDIA factors 4, 6 and 7. It seems likely that the SAS decision may place some limits on the Board's institution discretion, including whether the NVIDIA factors will continue to serve as a "baseline" going forward.

The Board recently designated three decisions as informative, underscoring the difficulty of challenging patents using arguments that were previously rejected during patent prosecution. All three cases — Unified Patents Inc. v. John L. Berman, Hospira Inc. v. Genentech Inc., and Cultec Inc. v. StormTech LLC — were denied institution on the holding that the art and/or the arguments were the same or similar to those previously presented to the USPTO.

Originally published by Law360 on November 8, 2017 (subscription required).​​​​​​​​

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
Events from this Firm
12 Dec 2018, Other, California, United States

Fenwick Counsel Robert Brownstone is lead chair​ in this highly interactive colloquium will provide a deep understanding and practical advice regarding major e-discovery challenges facing organizations today.

21 Jan 2019, Speaking Engagement, California, United States

Now entering its fifth year, the Pocket Gamer Connects events series has grown to become the biggest and most influential mobile games conference in the west as well as th​e biggest games event overall in the UK and Helsinki.

8 Mar 2019, Conference, Austin, United States

Join the world’s largest gathering of creative professionals at the 2019 SXSW Conference & Festivals in Austin, Texas from March 8-17.

Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
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
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

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 or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq 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 of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions