Revisions to PTAB Trial Rules

The USPTO proposed on August 20, 2015 amended rules applicable to trial practice for the three post grant proceedings known as IPR (inter partes review), PGR (post grant review) and CBM (covered business method), as well as derivation proceedings (which replaced the former interference practice).    A comment period of 60 days was set and has now been extended until November 18, 2015.

This rules package focuses on the claim construction standard for AIA trials, new testimonial evidence submitted with the patent owner’s preliminary response, a Rule 11-type certification, and a word count for major briefing.  This is in addition to prior ministerial rule changes and decisions  clarifying that the scope of the analysis by a patent owner for a motion to amend the claims of a patent in response to a Petition for IPR is limited to the prior art known to the patent owner, and allowing 10 additional pages for a motion to amend, and 10 additional pages for a petitioner’s reply brief (the proposed rules revise this limit for the reply to 5,600 words).

With respect to the Broadest Reasonable Interpretation (“BRI”) standard, the USPTO will continue to use the BRI standard in post grant proceedings for unexpired patents.  The USPTO recognized that a number of comments argued that the federal court standard used in the Phillips decision (Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005)) was more appropriate.  The Federal Circuit held in Phillips that the meaning of patent claims should be based on the meaning to one of ordinary skill in the art at the time of the claimed invention, in light of the specification and prosecution history.  Such commenters argued in favor of the Phillips standard on the basis that an IPR proceeding is most analogous to an invalidity trial in Federal Court where the Phillips standard would apply.  The USPTO agreed with the commenters who argued that the USPTO has an established history of using the BRI standard in reexamination, reissue and interference proceedings, and that the use of BRI served the public interest by reducing the possibility that claims as issued would be given a broader construction than appropriate.

However, the Phillips construction will be applied to those patents for which a viable opportunity to amend is not present.  Such is the case for patents that will expire prior to the issuance of a final decision.  The USPTO did not consider it a workable option to allow a patent owner to “opt-in” to the Phillips standard for unexpired patents because there would be inadequate time for the petitioner to amend the petition to address the changed standard, under current procedural timelines.

With respect to motions to amend, the USPTO explains in the response to comments that while a patent owner has the right to file a motion to amend, “37 CFR 42.121(a) and 42.122(a) require the patent owner to hold a conference call with the Office before the patent owner files a motion to amend. During that call, the judges provide technical guidance to the patent owner and the petitioner regarding the motion.”  (See Response to Comment 6.)  The USPTO further explained that once the patent owner demonstrates a prima facie case of patentability with respect to narrowed amended claims, the “burden of production” shifts to the petitioner.  The USTPO identified the following PTAB opinions to assist patent owners regarding motions to amend:

MasterImage, slip op. at 1–3); Idle Free Systems, Inc. v. Bergstrom, Inc., Case         IPR2012-00027 (PTAB June 11, 2013) (Paper 26) (informative); Int’l Flavors & Fragrances Inc. v. United States of America, Case IPR2013-00124 (PTAB May 20, 2014) (Paper 12) (informative); Corning Optical Comms. RF, LLC v. PPC Broadband, Inc., Case IPR2014-00441 (PTAB Oct. 30, 2014) (Paper 19); Riverbed Tech., Inc. v. Silver Peak Systems, Inc., Case IPR2013-00403 (PTAB Dec. 30, 2014) (Paper 33); Reg Synthetic Fuels LLC v. Neste Oil OYJ, Case IPR2014-00192 (PTAB June 5, 2015) (Paper 48).

These opinions are available on the PTAB PRPS system at this link:  http://www.uspto.gov/patents-application-process/appealing-patent-decisions/trials/patent-review-processing-system-prps-0 .

The specific proposed rule changes are summarized as follows:

42.11 – creates a duty of candor including potential sanctions against “any attorney, registered practitioner, law firm, patent agent, or party that violated the rule or is responsible for the violation. Absent exceptional circumstances, a law firm must be held jointly responsible for a violation committed by its partner, associate, or employee.”

42.24 – creates a maximum word count for petitions for IPRs (14,000), PGRs (18,700), CBMs (18,700), Derivation Proceedings (14,000), and Motions to Amend are limited to 25 pages, and other motions to 15 pages.  The word counts for a preliminary response, and patent owner response, are the same as the word counts for the petition.

42.100 (IPR); 42.200 (PGR); 42.300 (CBM) – codifies BRI standard for construction of patents that will not expire before a final written decision.

42.107 (IPR); (42.207)(PGR) – amends procedures of patent owner’s preliminary response to allow supporting evidence such as expert declarations to be included.  (A petitioner may seek leave to file a reply to a preliminary response if the response contains supporting evidence.)

The goal by the USPTO appears to be to “level the playing field” that some perceive as tilted in favor of the petitioner.  Patent Owners’ ability to present detailed arguments to support their proposed claim amendments in response to an IPR has been significantly enhanced.  Importantly, the PTAB is however maintaining its view that the appropriate claim construction standard for PTAB post grant proceedings is BRI which arguably favors petitioners.

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