Ahead of the four-year anniversary of PTAB trials being available on September 16 this year, Managing IP is publishing two articles a week revealing 10 issues to watch at the Board. Visit www.managingip.com/ptab to see which other articles have been published in the series so far.
One source of frustration with the Patent Trial and Appeal Board (PTAB) among patent owners has been the inability to amend claims during proceedings.
The USPTO said it released its report to “provide greater transparencies into our practices” and “aid the ongoing dialogue”.
PTAB observers are intrigued to see if the success rate now goes up.
“The Patent Office is under some pressure to grant more of them now,” says Don Steinberg, chair of the IP department at WilmerHale.
He adds that patent owners also have a better idea of what they need to do in order to get one allowed.
“It will be really interesting to see if patent owners have more success in the next six months,” says Steinberg. “If they do, it would suggest the process is now working better – a little bit because practitioners have become more sophisticated and a little bit because the Patent Office has eased up.”
Federal Circuit goes en banc
Pro-patent observers have been very critical of the low chance of success for motions to amend. For example, serial Federal Circuit dissenter Judge Pauline Newman has repeatedly highlighted the difficulty in amending claims as conflicting with the reason for the PTAB’s existence.
In In re Cuozzo (the first Federal Circuit opinion on a PTAB appeal), Newman described the availability of amendments as “almost illusory”, and argued this meant that the Board uses the wrong claim construction as a result.
“The restricted role of amendment in the America Invents Act proceedings comports with the intended and expected ‘correct’ claim construction, not the broadest claim construction. It comports with district court practices in adjudication, not PTO practices in examination,” she said.
Newman will soon have the chance to weigh in specifically on the issue of motions to amend. In a surprising move, the Federal Circuit in August granted an en banc rehearing of In re Aqua Products to address two issues related to the claims amendment process during PTAB trials:
- (a) When the patent owner moves to amend its claims under 35 USC § 316(d), may the PTO require the patent owner to bear the burden of persuasion, or a burden of production, regarding patentability of the amended claims as a condition of allowing them? Which burdens are permitted under 35 USC § 316(e)?
- (b) When the petitioner does not challenge the patentability of a proposed amended claim, or the Board thinks the challenge is inadequate, may the Board sua sponte raise patentability challenges to such a claim? If so, where would the burden of persuasion, or a burden of production, lie?
The oral argument date is set for December 9, with briefing in October and November.
Most practitioners agree that the PTAB sets too high a bar for amended claims, says Cyrus Morton, partner and chair of the Patent Office trials group at Robins Kaplan.
"But the problem with simply keeping the burden on the petitioner is that the petitioner has no way of knowing in advance what the amended claims will be, and no way to have marshaled the appropriate prior art," says Morton. "I also think the Federal Circuit will struggle with the idea of making the petitioner the gatekeeper for insuring patentability of new claims in a patent applicable to the public at large."
Others downplay the impact the case will have. Scott McKeown, partner and chair of the post-grant patent group at Oblon McClelland Maier & Neustadt, believes it likely the Federal Circuit will shift burdens away from patent owners seeking amended claims before the PTAB.
"My expectation is that the CAFC will shift the burdens to the petitioner in the first instance, and where absent (settlement), the Board," McKeown said in a post on the Patents Post-Grant blog.
But he said this will not have a big enough impact to bring the rate at which motions to amend are filed up from its low level. One big reason for this is that patent owners involved in litigation are careful not to amend claims so as not to ruin their infringement case.
"As In re Aqua Products Inc will not disturb any of intervening rights, substantial evidence, substitute claim practices, or infringement concerns of patentees, the issues presented by the CAFC are largely academic ones," McKeown concluded.
Not too harsh
A verdict out of the Federal Circuit this week also will not have done anything to change the view that the Board is harsh on motions to amend.
The Federal Circuit vacated the denial of a motion to amend in an inter partes review, and remanded the case back to the Board to address the patentability of two proposed substitute claims, in its Veritas Techs v Veeam Software decision. "We vacate the Board’s denial of Veritas’s motion to amend because the Board was arbitrary and capricious in its sole ground for denying the motion," said the appeals court But some defend the PTAB’s record on motions to amend.
“I’m in the camp where I don’t think the PTAB being overly harsh,” says Lori Gordon, director in the litigation and electronics practice groups at Sterne Kessler Goldstein & Fox. “It is the nature of the way that Congress set up the system. It saddled the patent owner with having to establish patentability. That is an incredibly difficult task, particularly when in you are in an adjudicative proceeding not an examinational one. I don’t foresee any change [in the success rate] in the future unless Congress changes the mechanism for doing motions to amend.”
Echoing McKeown’s point, Gordon says that patent owners do not want to amend in most cases, meaning the number of motions is relatively low to begin with.
“The reality is that motions to amend were rare to begin with because most of these patents are involved in litigation and you don’t want to amend claims that are currently in litigation or associated with claims in litigation,” says Gordon.
And even of the motions that are filed, WilmerHale’s Steinberg believes it is not meaningful to look at the percentage of successful motions to amend without considering whether the proposed amendments actually would distinguish the prior art.
“You can’t just look at the very low numbers of successful motions to amend and say the Patent Office is biased against them,” he says. “You have to look a little past the statistics.”
Data as of April 30 2016
Source: USPTO's Motions to Amend Study
