United States: Three PTAB Decisions On 35 U.S.C. § 325(d) Designated Precedential Or Informative

On March 24, 2020, three PTAB decisions applying 35 U.S.C. § 325(d) were designated precedential or informative.  The trio of decisions clarify the Board's use of its discretion under that statutory section.

Advanced Bionics, LLC v. MED-EL Elektromedizinische Geräte GmbH, IPR2019-01469, Paper 6 (Feb. 13, 2020) (precedential)

In Advanced Bionics, the Board exercised its discretion to deny institution of inter partes review under 35 U.S.C. § 325(d).  In doing so, the Board clarified that § 325(d) presents two distinct issues it must consider: first, whether the petition presents the same or substantially the same art as previously presented to the Office; and second, whether the petition presents the same or substantially the same arguments as previously presented to the Office.  Each inquiry is separate and highly factual, and can be decided by looking to the factors laid out in Becton, Dickinson & Co. v. B. Braun Melsungen AG, IPR2017-01586, Paper 8 (Dec. 15, 2017) (precedential as to section III.C.5, first paragraph).¹

In addition, the consideration of each issue is itself two-fold.  If the Board finds that the same art or arguments have been previously presented, it must then consider whether the petition has demonstrated that the Office "erred in a manner material to the patentability of challenged claims."  The error must be clear: if "reasonable minds can disagree," the Office cannot be said to have materially erred.  Thus, even if the Board determines that the same art or arguments were previously presented under the first prong of § 325(d), the Board may nonetheless choose to institute inter partes review under the second prong if it determines that the Office materially erred in its prior analysis.

The Becton, Dickinson factors can guide this two-part analysis.  Factors (a), (b), and (d) can guide consideration of the first prong of the § 325(d) test in determining whether the same art or arguments were previously presented.  And factors (c), (e), and (f) can guide consideration of the second prong in determining whether the petitioner has demonstrated a material error by the Office. 

Oticon Medical AB v. Cochlear Ltd., IPR2019-00975, Paper 15 (Oct. 16, 2019) (precedential as to sections II.B and II.C)

Unlike Advanced Bionics, the Board instituted inter partes review in Oticon Medical, declining to exercise its discretion under § 325(d).  In section II.B of the decision, the Board analyzed each of the Becton, Dickinson factors in turn, finding that the art cited in the petition was new and noncumulative.

In section II.C, the Board addressed the patent owner's argument regarding 35 U.S.C. § 314(a).  The patent owner argued that the Board should deny institution under § 314(a) because the petitioner waited until the end of the one-year time bar to file the petition and then used the patent owner's positions and responses in the accompanying District Court case to inform its petition.  Additionally, the patent owner contended that the District Court would likely determine the validity of the patent during the same or similar timeframe as any instituted inter partes review.

The Board acknowledged that Gen. Plastic Indus. Co. v. Canon Kabushiki Kaisha, IPR2016-01357, Paper 19 (Sept. 6, 2017) pronounced a non-exhaustive list of factors for the Board to consider in evaluating whether to exercise its discretion under § 314(a).  But the concerns raised in General Plastic, namely those of "follow-on petitions" related to parallel litigation, were not raised by the case at hand.  Unlike the petitioner in General Plastic, Oticon Medical had not previously filed a petition.  And although the petitioner may have derived benefit from seeing the patent owner's responses to invalidity contentions and arguments before the petition was filed, the Board determined that the IPR proceeding would not be "directly duplicative" of the District Court proceeding because the prior art references presented by the petitioner differed between the District Court proceeding and the proceeding before the Board.  Further, the patent owner had neither argued that a stay would be issued in the District Court proceeding, nor provided the court's schedule for that proceeding to indicate the stage of the case.  Weighing these factors, the Board declined to exercise its discretion under § 314(a).

PUMA N. Am., Inc. v. NIKE, Inc., IPR2019-01042, Paper 10 (Oct. 31, 2019) (informative)

The PUMA decision provides an example of the Board applying the two-prong approach to § 325(d) set forth in Advanced Bionics.  The Board considered each of the six Becton, Dickinson factors in turn.  After quickly finding that factors (a)–(c) either weighed in favor of exercising discretion to deny institution or were neutral, the Board then analyzed factor (d), and found that there was a high degree of overlap between the arguments made during examination and those made in the petition.  Thus, the Board concluded that factor (d) weighed in favor of exercising discretion to deny institution.

The Board then moved to the second prong of the § 325(d) test: whether petitioner has sufficiently shown how the Office erred.  Considering Becton, Dickinson factors (e) and (f), the Board found that the petitioner had failed to show how the Examiner erred in applying the prior art.  The PUMA Board thus exercised its discretion under § 325(d) to deny institution of inter partes review.

Footnotes

1 The Becton, Dickinson factors are:

Becton, Dickinson at 17–18.

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