October PTAB round-up: Filing holds up, CAFC IPR reviewability decisions, fee and patent agent privilege changes

The monthly numbers of Patent Trial and Appeal Board (PTAB) petitions filed for the past four months have been within a 14-petition range, after displaying volatility at the start of the year.

In October, 155 total PTAB petitions were filed. This compares with 154 in September, 143 in August and 157 in July. Two other months this year fell within that range. June was the high for the year, with 176. January was the low, with 99.

Inter partes review (IPR) petition filing was steady in October. The 149 petitions was barely up from 148 in September. (You can read our analysis of third-quarter PTAB filing here.)

The five covered business method petitions in October was the most since June. Only one post-grant review petition (PGR) was filed.

According to data pulled from the Docket Navigator database, Apple was the biggest filer in October, with 15 petitions. All but one of them challenged patents owned by Papst Licensing, which was the most targeted patent owner in October.

Samsung was next in the petitioner rankings, with 13. Social media company Facebook was the third-busiest filer, with 12 petitions, eight of which involved its Instagram subsidiary.

Facebook has filed 39 PTAB petitions since July 2013, 24 of which have come this year. Its October filing consisted of four CBMs and eight IPRs. Eight of the petitions challenged seven patents owned by Skky for media delivery platforms. Four challenged one patent owned by Bruce Zak related to a system and method for managing content on a network interface. Skky sued Facebook for patent infringement in the District of Minnesota in January this year. Zak sued Facebook for patent infringement in the Eastern District of Michigan in September last year.

Top petitioners and patent owners in October 2016
Petitioner	Petitions		Patent owners	Petitions
Apple	15		Papst Licensing	14
Samsung Electronics	13		ProMOS Technologies	8
Facebook	12		Skky	8
Instagram	8		Boston Scientific	7
Ford	7		Versata Development Group	7
Campbell Soup Company	6		Gamon Plus	6
Fisher & Paykel Healthcare	6		ResMed	6
Trinity Manufacturing	6		Daicel Corporation	5
Celanese International	5		Bruce Zak	4
Cook Group	5		Eagle View Technologies	4
Baker Hughes	4		Lubrizol Specialty Products	4
Insurance Services Offices	4
Mylan	4
Verisk Analytics	4
Xactware Solutions	4
Source: Docket Navigator

The most important Federal Circuit action on a PTAB appeal in October was the rehearing in Medtronic v Robert Bosch. The original decision was reconsidered because of the Supreme Court’s Cuozzo decision. The Federal Circuit panel reaffirmed its order that a determination by the PTAB to discontinue IPR proceedings was not reviewable on appeal. The Board had terminated the IPR because it said Medtronic failed to identify all real parties in interest.

“The Board’s vacatur of its institution decisions and termination of the proceedings constitute decisions whether to institute inter partes review and are therefore ‘final and nonappealable’ under § 314(d). Nothing in Cuozzo is to the contrary,” said the Federal Circuit.

It added: “We conclude that under Cuozzo a decision whether to institute inter partes review proceedings pursuant to § 314(a) (the issue in Cuozzo) and a reconsideration of that decision (the situation here) are both barred from review by § 314(d).”

Knobbe Martens provided a summary of Federal Circuit cases that have ruled on reviewability of IPR institution. The appeals court has found nearly all decisions related to the institution of IPR proceedings to be unreviewable.

Federal Circuit and Supreme Court decisions regarding review of IPR institution
Case	Ground for challenge	Court decision
St Jude Med, Cardiology Volcano Corp (Fed Circ 2014)	Whether 35 USC § 314(d) bars the court's review of the Board's decision, when the decision to deny institution was based on the timing requirement under 35 USC §315(b)	Not reviewable
Versata v SAP (Fed Circ 2016) (cert denied on June 27 2016)	Whether § 324(e) prohibits review of a final written decision on whether a patent is a covered business method patent	Reviewable
In re Cuozzo Speed (Fed Circ 2015)	Whether the Board's decision to grant institution is unreviewable when some claims were instituted based on prior art not identified in the petition and were not pleaded "with particularity" as required by § 312(a)(3)	Not reviewable
Achates v Apple (Fed Circ 2015)	Whether 35 USC § 314(d) prohibits the court from reviewing the Board's determination to initiate IPR proceedings based on its assessment of the time-bar under § 315(b)	Not reviewable
Avid Technology v Harmonic (Fed Circ 2016)	Whether the Board's decision to deny institution based on redundancy is unreviewable	Not reviewable
Cuozzo Speed Tech v Lee (Supreme Court 2016)	Whether the Board's decision to grant institution is unreviewable when some claims were instituted based on prior art not identified in petition and were not pleaded "with particularity" as required by § 312(a)(3)	Not reviewable
Wi-Fi One v Broadcom (Fed Circ Sept 16 2016)	Whether the Board's decision to grant institution based on its assessment of the time-bar under § 315(b) is reviewable when the Board improperly allowed a privy of time-barred district court litigant to pursue an IPR	Not reviewable
Husky Injection Molding Sys v Athena Automation (Fed Circ Sept 23 2016)	Whether the Board's decision to grant institution is reviewable when the Board declines to apply § 311 assignor estoppel during the institution phase	Not reviewable
Medtronic v Robert Bosch Healthcare Systems (Fed Circ Oct 20 2016)	Whether the Board's determination to vacate an institution decision is reviewable when the determination was based on failure to identify a real party-in-interest as required by § 312(a)(2)	Not reviewable
Source: Knobbe Martens

Lawyers at Knobbe Marten commented: “Medtronic provides yet another example that statutory requirements such as a real party in interest are considered to be ‘closely related’ to the decision to institute IPR proceeding and are therefore not reviewable on appeal. While the door to requesting judicial review of an IPR institution decision appears to be closed in most cases, the two-part test provided in Husky suggests that it may not be completely closed.”

Jones Day commented: “It is clear that the Supreme Court and the Federal Circuit believe Congress ceded institution decisions and many related procedural issues to the realm of unreviewable decisions. It will be interesting to observe what other issues the Federal Circuit will find to be ‘closely related’ to the PTAB’s decision to institute IPRs.” The law firm said one example is that it is unclear whether an appeal can be maintained from a petition that is denied institution under § 315(e)(1) due to estoppel from a prior final written decision.

Another Federal Circuit ruling of interest was a Rule 36 decision affirming the invalidation of the CBM patents that were specifically cited during the debate in Congress about the America Invents Act, in DataTreasury v Fidelity (you can read an analysis of that decision here). 

The first final written decisions on Coalition for Affordable Drugs petitions have come out in the past month. So far, seven IPRs have made it to final written decision. Six of these have resulted in invalidated claims of a total three patents, with two of those patents having all challenged claims invalidated. You can read a full analysis here.

In Duodecad IT Services Luxembourg v WAG Acquisition, the PTAB in a final written decision determined that a patent’s file history qualifies as a “printed publication” under 35 USC 102(b). Jones Day noted: “For petitioners this decision counsels towards examining a prior art patent’s file history to determine if it contains additional information that is not present in the patent itself, as the combination of the patent and its file history contents could serve as a persuasive ground of unpatentability.”

In GoPro v Contour IP Holding, the PTAB found that a catalogue that was distributed at a trade show attended by thousands was not a printed publication. The Board reasoned that there was no evidence that persons of ordinary skill in the art were at the show because the audience was dealers and vendors members and not the general public.

One interesting case to keep an eye on involves sovereign immunity of state universities. The PTAB will rule on whether state sovereign immunity prevents an IPR challenge from being maintained against a University of Florida patent.

As Foley & Lardner’s Steve Maebius noted on the PTAB Trial Insights blog: “State university patent owners who have availed themselves of the remedies offered by infringement litigation in federal courts, have still been able to use the sovereign immunity shield of the 11th Amendment to prevent other suits against them challenging validity of their patents … While the use of state sovereign immunity as a shield in patent litigation is not new, this appears to be the first instance of it being asserted as a defence in an IPR or AIA proceeding.”

At the end of September the USPTO released proposed patent fee adjustments. These included PTAB trial fee increases “aimed at better aligning these fees with the USPTO’s costs and aiding the PTAB to continue to meet required AIA deadlines”. PTAB fee increases of between 18% and 56% have been proposed.

These include: IPR request fee for up to 20 claims increasing to $14,000 from $9,000; IPR post-institution fee for up to 15 claims increasing to $16,500 from $14,000; PGR or CBM review request fee for up to 20 claims increasing to $16,000 from $12,000; and PGR or CBM review post-institution fee for up to 15 claims increasing to $22,000 from $18,000.

The USPTO is holding a comment period on the fee increases that closes on December 2.

Marshall Gerstein’s PTABWatch blog explained: “The Patent Office now has three years of data and, therefore, an insight into the costs of administering AIA trials and estimating the demand for these proceedings. And the notice explains that the fee adjustments the Patent Office proposes are meant to align more appropriately with this insight and estimate.”

In October, the USPTO proposed new rulemaking that would recognise patent agent privilege in PTAB proceedings. This would expand privilege to cover communications with foreign agents, which is not addressed under the rules now. It would apply for IPR, PGR, CBM and derivation proceedings. 

The Office is proposing to amend the PTAB rules to “recognise that, in connection with discovery conducted in certain proceedings at the [USPTO], communications between US patent agents or foreign patent practitioners and their clients are privileged to the same extent as communications between clients and US attorneys.” A comment period on the proposal closes on December 19.

Scott McKeown on the Patents Post-Grant blog commented: “The rule is designed to ensure consistency in such determinations before the agency as the common law on privilege for domestic and foreign patent practitioners varies across jurisdictions. Different approaches are taken, and results sometimes conflict. This may lead to administrative inefficiencies and inconsistencies in outcomes, as PTAB must select which set of common law rules to follow.”

The Supreme Court denied cert in six PTAB cases in October.

According to the PTAB Bar Association, the Court denied petitions challenging IPRs’ constitutionality (MCM Portfolio, Cooper v Lee), statutory interpretation of AIA provisions (Trading Technologies, GEA Process), other AIA issues (Merck & Cie, MacDermid) and reexaminations (Pactiv and MacDermid).

AIA filings by month
Month	Number of petitions filed
	IPR	CBM	PGR	Total
Sep 2012	17	8	0	25
Oct 2012	24	5	0	29
Nov 2012	24	2	0	26
Dec 2012	32	0	0	32
Jan 2013	25	0	0	25
Feb 2013	30	0	0	30
Mar 2013	38	2	0	40
Apr 2013	27	4	0	31
May 2013	45	7	0	52
Jun 2013	65	8	0	73
Jul 2013	69	3	0	72
Aug 2013	62	9	0	71
Sep 2013	73	8	0	81
Oct 2013	77	19	0	96
Nov 2013	89	18	0	107
Dec 2013	101	11	0	112
Jan 2014	60	9	0	69
Feb 2014	54	12	0	66
Mar 2014	76	22	0	98
Apr 2014	143	14	0	157
May 2014	131	19	0	150
Jun 2014	184	6	0	190
Jul 2014	116	10	0	126
Aug 2014	159	16	1	176
Sep 2014	120	21	1	142
Oct 2014	179	16	0	195
Nov 2014	102	13	1	116
Dec 2014	177	15	0	192
Jan 2015	100	14	1	115
Feb 2015	164	16	0	180
Mar 2015	131	13	1	145
Apr 2015	139	7	0	146
May 2015	145	26	3	174
Jun 2015	182	9	2	193
July 2015	117	6	0	123
Aug 2015	165	9	3	177
Sep 2015	136	5	0	141
Oct 2015	106	11	0	117
Nov 2015	131	10	1	142
Dec 2015	138	5	1	144
Jan 2016	96	3	0	99
Feb 2016	132	12	6	150
Mar 2016	107	10	1	118
Apr 2016	136	10	2	148
May 2016	114	17	4	135
Jun 2016	166	9	1	176
Jul 2016	155	1	1	157
Aug 2016	136	4	3	143
Sep 2016	148	2	4	154
Oct 2016	149	5	1	155
Cumulative Total	5,292	481	38	5,811
Source: USPTO