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Impacts of Recent PTAB Precedential Opinions Addressing Its Discretion to Reject Petitions for Review of Issued Patents

March 27, 2020 Articles

The Patent Trial and Appeal Board (PTAB) recently designated two more opinions as “precedential” dealing with its discretion to reject petitions for inter partes review (IPR) or similar post-grant reviews. Under 35 U.S.C. § 325(d), the Board has discretion to reject a petition where “the same or substantially the same prior art or arguments previously were presented to the Office.” The Board has issued previous precedential decisions addressing how it will exercise this discretion and in particular set out six relevant factors (commonly referred to as Becton Dickenson factors) to consider, including the similarities and material differences between the asserted prior art and the prior art involved during examination, the cumulative nature of the asserted art and the previously examined art, and the extent to which the asserted art was evaluated during examination.

These recent decisions applied the Becton Dickenson factors to address unexamined prior art that, according to the patent owner, was “substantially the same” as prior art presented during prosecution. In the Advanced Bionics v. MED-EL Elektromedizinische Gerate decision, the Board analyzed the asserted prior art and invalidity arguments and exercised its discretion to reject the petition in light of similar prior art and arguments in the prosecution history, while in Oticon Medical v. Cochlear the Board similarly analyzed the asserted prior art and arguments in light of the prosecution history but reached the opposite conclusion and granted inter partes review.[1] Taken together, these decisions further clarify the scope of the Section 325(d) analysis the Board applies when deciding whether to institute a review of an issued patent. These decisions highlight another pitfall for petitioners who do not sufficiently differentiate their prior art arguments from those considered during the initial Patent Office examination. They also provide fertile ground for patent owners drafting their Preliminary Responses in which they can focus on the pre-institution Section 325(d) inquiry, while keeping their powder dry on the merits in case a review is instituted.

Advanced Bionics, LLC v. MED-EL Elektromedizinische Geräte GmbHIPR2019-01469 (Paper 6—denying institution)

In this decision, the Board applied a two-part framework for determining whether to exercise its discretion under Section 325(d). First, the Board considered whether the prior art and arguments presented in the IPR petition were “the same or substantially the same” as prior art and arguments previously presented during prosecution. The Board applied the Becton, Dickinson factors and determined that the petition, which relied on a prior art reference cited during prosecution in combination with other references that were not cited during prosecution, relied on the “same or substantially the same prior art” previously presented. It is worth nothing that the Board closely parsed the prosecution history to determine that the petitioner was advancing new references to meet certain claim limitations in substantially the same way the patent examiner had during prosecution based on similar references. Having found the first part of the framework satisfied, the Board next considered whether the petition demonstrated that the Patent Office “erred in a manner material to the patentability of challenged claims.” Because the petition did not show that the examiner erred when considering the prior art during prosecution, the Board concluded that it was appropriate to exercise its discretion to reject the IPR petition. This decision is not appealable.

Oticon Medical AB v. Cochlear Limited, IPR2019-00975 (Paper 10—granting institution)

As in Advanced Bionics, the petition in Oticon Medical relied on some prior art that was cited during prosecution and other prior art that was not cited. The patent owner argued in its Preliminary Response that the “new” prior art was merely cumulative of another reference that was considered during prosecution. Applying the Becton Dickinson factors, the Board closely compared the cited prior art identified by the patent owner and the “new” prior art cited in the petition. The Board contrasted the references (one describing a bone screw and the other a dental implant) and found them different in structure and function, and it further found that the prior art reference in the IPR petition provided a functional advantage because it dispersed stress on bone. The Board then determined that the examiner had not considered the teachings of the prior art cited in the IPR and that the examiner therefore erred (apparently by not identifying and considering it during prosecution). The Board concluded therefore that it would not exercise its discretion under Section 325(d).

In a separate section of the decision that was also made precedential, the Board similarly declined to exercise its discretion under Section 314(a) despite the patent owner’s argument that the petitioner had waited as long as possible to get the “road mapping” benefit of responses to invalidity arguments in the related district court proceedings. The Board determined that its instituted IPR “proceeding would not be directly duplicative of the District Court consideration of validity.” The Board further rejected the patent owner’s contention that the petitioner was trying to stall the district court action given that there was no evidence that the district court action had been stayed and indeed the patent owner had not even provided the schedule from the district court. The Board instituted review of the challenged patent and the IPR proceeding will now move on to the trial phase.

Impact of the PTAB’s Recent Precedential Decisions

The Board Provides a Framework: The Advanced Bionics and Oticon Medical decisions provide a framework for practitioners and the Board to employ when analyzing the Board’s discretion to reject a petition under Section 325(d). The Board’s stated goal is to “defer to previous [Patent Office] evaluations of the evidence of record unless material error is shown.” The first part of the analysis focuses on determining if the prior art arguments are “the same or substantially the same” as prior art arguments made during prosecution. This part employs the factors set out in the precedential Becton Dickinson case. Where the Board concludes that the first part it met, it will then consider whether the Patent Office “erred” in examination of the challenged patent.

What Petitioners and Patent Owners Should Take Note of in These Decisions: The Advanced Bionics decision shows that the PTAB can conduct a fine-grained comparison of previously-cited and previously uncited prior art in making its decision whether to reject an IPR petition for advancing prior art arguments that are different but “substantially the same” as those considered during prosecution. For patent owners, this underscores the importance of including any available specific and fact-intensive Section 325(d) argument in the preliminary response. The Section 325(d) determination is a discretionary one that will be made before institution and before the petitioner is permitted to file a reply as of right. Therefore, if the patent owner can make credible and well-supported arguments, they may go unrebutted before the institution decision. If the Board accepts such an argument and exercises its discretion to deny institution, that decision will be unappealable.

Petitioners also should compare the prior art to be advanced in the petition with art discussed during examination in an effort to avoid a discretional rejection under Section 325(d). Petitioners should seek to avoid repeating arguments that the patent owner already overcame during prosecution. Ideally, the petition should advance prior art theories distinct from those raised previously and particularly those that were the basis of claim rejections. If not, however, the petition should explain clearly to the Board why the prior art arguments in the petition are not “substantially similar” to the prior arguments during prosecution. And that discussion should be detailed. The petitioner in Advanced Bionics addressed the Becton Dickinson factors in the petition, but did so in a cursory manner rather than engaging in the fact-intensive comparison of prior art references that the patent owner did and that the Board ultimately found persuasive. When a patent owner raises significant issues under Section 325(d) in the preliminary response, the petitioner should also consider seeking leave to file a preliminary reply brief responding to those arguments. Otherwise, unrebutted arguments by the patent owner might lead the Board to deny institution, which again is a decision not subject to appeal.


[1] The Board also issued an informative decision in PUMA North America, Inc. v. NIKE, Inc., IPR2019-01042 (Paper 10), denying institution where the examiner had twice considered the same combination of references advanced in IPR.

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