Since the passage of the America Invents Act in 2011, a significant proportion of patent litigation in the United States has moved to trials held before the Patent Trial and Appeal Board (PTAB) of the US Patent and Trademark Office (USPTO). These trials are relatively fast, inexpensive, and narrow in scope compared to litigation in other forums, such as district courts or the International Trade Commission. This paper presents a brief summary of key case milestones and strategic considerations for PTAB trials.
There are several types of adversarial post-grant proceedings at the PTAB, including inter partes review (IPR), covered business method review (CBM), and post-grant review (PGR). To date, IPRs have been the most popular PTAB trial proceeding, comprising 93% of petitions filed at the PTAB through August 31, 2019.1 The popularity of IPRs likely hinges, at least in part, on the proceeding's relatively less restrictive provisions regarding which patents are eligible for review2 and post-decision estoppel.3 IPR proceedings are limited to patent validity challenges under the legal theories of anticipation and obviousness.4 Prior art asserted during an IPR is also limited to patents and printed publications.5 CBM and PGR proceedings, in contrast, allow for a broader range of legal challenges, including grounds addressing subject matter eligibility, enablement, indefiniteness, and written description support.6
I. Pre-Institution Filings
A party initiates a post-grant proceeding at the PTAB by filing a petition for review. This petition must identify, with particularity, each claim challenged, the grounds on which each challenge to each claim is based, and the evidence supporting each ground.7 Testimony supporting the petition must be submitted in the form of a written declaration, such as expert witness testimony regarding the knowledge of a skilled artisan.8 A notable restriction on the timing of IPR petitions is the "one-year bar," which prohibits institution of an IPR petition filed more than one year after service of a district court complaint alleging infringement of the patent-at-issue.9
The petitioner bears the ultimate burden of proof for unpatentability in PTAB proceedings.10 The PTAB requires a showing by a preponderance of the evidence, which is more favorable to petitioners than the clear and convincing evidence standard applied in district court.11 The petition must also set forth the petitioner's positions on all necessary claim construction issues.12 Although the PTAB previously used a different claim construction standard than district courts, the PTAB now construes claims under the same "Phillips" standard.13
Once the petition is filed and accepted by the Office after a procedural review, a filing date is awarded. The patent owner has three months to file an optional patent owner preliminary response, which can address reasons why the Board should decline to institute review of the challenged patent.14 While the preliminary response may be supported by declarant testimony, such as testimony from an expert witness, at this early stage the PTAB views genuine factual disputes in the light most favorable to the petitioner.15 As a result, patent owners often reserve at least some substantive arguments concerning a disputed question of fact for presentation during the post-institution trial.
II. Institution of Trial
The PTAB has up to three months to issue a decision on whether to institute trial after the earlier of (1) the patent owner's preliminary response filing, or (2) the preliminary response due date.16 In its institution decision, the PTAB must either institute review of all grounds presented in the petition or deny institution entirely.17 For institutions in IPR proceedings, the PTAB considers whether the petition (in view of the preliminary response) demonstrates a reasonable likelihood of unpatentability for at least one challenged claim.18 PGR and CBM proceedings consider a slightly different standard: whether it is more likely than not that at least one challenged claim is unpatentable.19 CBM proceedings include an additional consideration of whether the challenged patent is a "covered business method" patent subject to CBM review.20 The Board has discretion to deny institution of review, and may do so, for example, because similar prior art and arguments were previously considered by the USPTO during prosecution,21 or because the challenges presented in the petition are too similar to those raised in a previously filed petition against the same patent.22
If trial is instituted, the PTAB issues a Scheduling Order setting out due dates for the remaining stages of the case, including the timing of the patent owner response, petitioner's reply, and patent owner's sur-reply filings. The Scheduling Order also establishes the timing of filings relating to evidentiary disputes and the tentative date of an oral hearing, which the parties must affirmatively request by a stated date.
III. Post-Institution Filings
Upon institution of trial, the patent owner is typically afforded around three months to file a patent owner's response to the petition.23 Patent owner responses typically include a rebuttal of the unpatentability positions presented in the petition and can be supported by expert testimony. The petitioner may then file a petitioner's reply, which may only respond to arguments raised in the patent owner response.24 The patent owner may respond with a sur-reply limited to responding to the petitioner's reply.25
The patent owner may also file a motion to amend the challenged claims.26 If it does, the petitioner may file an opposition to the motion to amend and may respond to new patentability issues arising from the patent owner's proposed substitute claims, even if those new grounds would not otherwise be available in, for example, an IPR proceeding.27 The patent owner may then file a reply to the petitioner's opposition to the motion to amend, and the petitioner may file a corresponding sur-reply. Under the PTAB's March 2019 pilot program for motions to amend, the patent owner may have additional options during the amendment process, including receiving preliminary guidance from the PTAB and filing a revised motion to amend in response.28
IV. Fact Discovery, Protective Orders, and Evidentiary Disputes
Discovery in PTAB trials is limited by design and is divided into "routine" and "additional" discovery.29 Routine discovery is granted in every case and includes cross-examination of expert witness declarant testimony via deposition.30 Additional discovery in IPR proceedings may be granted when doing so "is in the interests of justice," such as for inquiries relating to the real-parties in- interest in a proceeding, and the burden of proof for obtaining such discovery falls on the party seeking it.31
To exclude evidence submitted during a trial, the parties must first file objections to the evidence within a relatively short time frame.32 These objection filings must identify the grounds for objection with "sufficient particularity to allow correction in the form of supplemental evidence."33 Later in the case, the parties may file a motion to exclude the objected-to exhibits. Motions to exclude must explain the objections in detail and are required to preserve any earlier objection.34 The Board rules on the arguments raised in the motions to exclude in the Final Written Decision.
V. Oral Hearing
The parties may request an oral hearing before the panel of administrative law judges assigned to the case by the date stated in the Scheduling Order and must specify the issues to be argued when doing so.35 The petitioner generally presents first (and may reserve rebuttal time), followed by the patent owner. Although demonstrative exhibits are permitted at the hearing, no new arguments may be raised by either party.36 The Board may permit live testimony of party witnesses in rare circumstances, such as when the credibility of a witness is potentially dispositive of a case, but counsel for each party are ordinarily the sole presenters at the hearing.37
VI. Final Written Decision and Appeal
The Board is required to issue a Final Written Decision within one year of instituting trial, absent a showing of good cause.38 In these decisions, the Board determines whether the petitioner met its burden of showing the unpatentability of the challenged claims by a preponderance of the evidence. The Board is required to issue a patentability determination for every claim challenged in the petition and instituted for trial.39 Parties receiving an adverse ruling from the PTAB may appeal to the Court of Appeals for the Federal Circuit. The appeal must be filed within 63 days of the decision or a decision on any properly filed rehearing request.40
The PTAB offers a streamlined, cost-effective venue for challenging the patentability of a patent. Due to the high popularity of the forum for high-stakes patent litigation, understanding the PTAB's unique procedures and strategies benefits petitioners and patent owners alike.
1 Trial Statistics, Patent Trial and Appeal Board August 2019, available at: https://www.uspto.gov/sites/default/files/documents/Trial_Statistics_2019-08-31.pdf.
2 See 35 U.S.C. § 311(a) and (c).
3 35 U.S.C. § 315(e).
4 35 U.S.C. § 311(b).
6 See 35 U.S.C. § 321.
7 35 U.S.C. § 312(a)(3).
8 35 U.S.C. § 312(a)(3)(B); 37 C.F.R. § 42.63.
9 35 U.S.C. § 315(b).
10 35 U.S.C. § 316(e).
12 37 C.F.R. § 42.104(b)(3).
13 See "Changes to the Claim Construction Standard for Interpreting Claims in Trial Proceedings Before the Patent Trial and Appeal Board," 83 Fed. Reg. 51340 (Oct. 11, 2018).
14 37 C.F.R. § 42.107.
15 37 C.F.R. § 42.108.
16 35 U.S.C. § 314(b).
17 SAS Institute v. Iancu, 138 S. Ct. 1348, 1354 (2018).
18 35 U.S.C. § 314(a).
19 35 U.S.C. § 324(a).
20 America Invents Act, § 18(a)(1)(E).
21 35 U.S.C. § 325(d).
22 35 U.S.C. § 314(a); see Valve Corp. v. Elec. Scripting Prods., Inc., IPR2019-00062, Paper 11 at 2 (PTAB Apr. 2, 2019) (Precedential).
23 37 C.F.R. § 42.120.
24 37 C.F.R. § 42.23.
26 37 C.F.R. § 42.121.
27 See Office Patent Trial Practice Guide, July 2019 Update, 84 Fed. Reg. 33925 (July 16, 2019); full text available at: https://www.uspto.gov/sites/default/files/documents/trial-practice-guide-update3.pdf (see relevant discussion at PDF page 39).
28 Notice Regarding a New Pilot Program Concerning Motion to Amend Practice and Procedures in Trial Proceedings Under the America Invents Act Before the Patent Trial and Appeal Board, 84 Fed. Reg. 9497 (March 15, 2019).
29 37 C.F.R. § 42.51.
30 37 C.F.R. § 42.51(b)(1).
31 37 C.F.R. § 42.51(b)(2).
32 37 C.F.R. § 42.64(b)(1).
33 37 C.F.R. § 42.64.
35 37 C.F.R. § 42.70.
36 See Dell Inc. v. Acceleron, LLC, 884 F.3d 1364, 1369–70 (Fed. Cir. 2018).
37 See K-40 Elecs., LLC v. Escort, Inc., IPR2013-00203, Paper 34 at 2 (PTAB May 21, 2014) (Precedential).
39 35 U.S.C. § 316(a)(11).
40 35 U.S.C. § 318(a).
41 37 C.F.R. § 90.3.
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