Fifteen Months of Contested Proceedings Under the America Invents Act: Lessons Learned

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By Naveen Modi and Srikala P. Atluri

Naveen Modi is a partner at Finnegan, Henderson, Farabow, Garrett & Dunner LLP in Washington, D.C. His practice focuses on all aspects of patent-related work, including post-grant proceedings before the Patent Trial and Appeal Board, district court and appellate litigation and client counseling.

Srikala P. Atluri is an associate at the same Finnegan Henderson office. Her practice includes handling post-grant proceedings before the PTAB and litigation in district courts and at the International Trade Commission.

This article is for informational purposes, is not intended to constitute legal advice, and may be considered advertising under applicable state laws. This article is only the opinion of the authors and is not attributable to Finnegan, Henderson, Farabow, Garrett & Dunner LLP or the firm's clients.

It has been a little over 15 months since the establishment and implementation of contested proceedings under the America Invents Act. As of Jan. 1, 2014, close to 800 petitions for inter partes review (IPR) and over 100 petitions for covered business method patent review (CBM) have been filed. Entering into the third calendar year since the establishment of IPR and CBM petitions in September 2012, the Patent Trial and Appeal Board has made more than 300 decisions on institution and rendered a handful of final decisions.

These decisions and the course of proceedings in both successful and unsuccessful petitions have revealed valuable lessons for petitioners and patent owners alike. Specifically, petitioners should provide well reasoned and detailed grounds for rejection, consider submitting expert declarations, and propose constructions with appropriate support for any and all contested or potentially contested claim terms.

Conversely, patent owners should be alert for deficiencies in any of these areas. And both petitioners and patent owners should always be prepared for any and all eventualities, and be ready to adapt during the course of proceedings.

Provide Well Reasoned and Detailed Grounds for Rejection

The seemingly common-sense concept of providing well reasoned and detailed grounds for rejection has been the cause of numerous petition denials and denials-in-part. The board applies a strict approach with respect to IPR and CBM petitions. Relying on 35 U.S.C. §312(a)(3) and 37 C.F.R. §§42.22(a) and 42.104(b), the board has denied petitions that fail to explain proposed rejections in detail.

For each challenged claim, 35 U.S.C. §312(a)(3) requires petitions to identify “in writing and with particularity … the grounds on which the challenge to each claim is based, and the evidence that supports the grounds.” 37 C.F.R. §§42.22(a)(2) and 42.104(b)(5) expand on this, calling for petitions to present “a detailed explanation of the significance of the evidence” and “the relevance of the evidence to the challenge raised, including identifying specific portions of the evidence that support the challenge,” respectively.

For instance, simply identifying passages within prior art references as corresponding to claim elements may be insufficient. In Tasco v. Pagnani, the board determined that “[r]ather than providing specificity, Petitioner merely identifie[d] structures in [the prior art reference], without explaining why or how the identified structures allegedly meet the requirements of the claim.”1 The petitioner's showing was deemed to be nothing more than “conclusory allegations” that were insufficient to meet its burden.

In addition, assertions that a person of skill in the art would have combined features from multiple references to render a claim obvious or that a person of skill in the art would have found an element obvious,2 with little more, have been consistently rejected and result in dismissal of the challenge as unsupported. Likewise, “catch-all” statements claiming that any combination of the disclosed references satisfies the claims or that any missing elements would have been obvious to one of skill in the art should be avoided, as they are summarily dismissed by the board.3 Rather, the board requires petitioners to expressly identify differences between the claims and the prior art,4 and provide facts and reasoning as to how and why a person of skill in the art would have combined features from different references to arrive at the claimed invention.5

In the same vein, the board has identified two types of redundant grounds of rejection--horizontally redundant rejections and vertically redundant rejections. The board looks upon both with disfavor. Horizontally redundant rejections apply numerous prior art references for the same teaching, and vertically redundant rejections apply multiple prior art references in both partial and full combinations to render a claim anticipated and/or obvious.6 The board may refuse to consider either type without some explanation as to why one reference or combination is relatively stronger or weaker than another reference or combination.

In light of the board's decisions, a petitioner's efforts--and pages--may be better spent addressing, in detail and with sufficient support, what he or she believes to be his or her strongest grounds of rejection instead of directing resources into numerous grounds of rejection, none of which include the detail required by the board. Indeed, the board appears to be rejecting--based on redundancy--multiple petitions that seek review of the same patent and that overlap in the prior art being applied and/or the claims being challenged.7

Patent owners should point out conclusory grounds for rejection, such as the failure to explain how and why a prior art reference teaches the claimed elements, the failure to explain what elements are missing from references used to allege obviousness, and the failure to explain how and why particular references should be combined. This, combined with an awareness of redundant rejections, can be an important tool in responding to petitions.

Consider Submitting an Expert Declaration

The board has indicated it expects expert declarations to be submitted by petitioners.8 Though patent owners may not file expert declarations with their preliminary response,9 they should be ready to submit their own if review is instituted. Expert declarations are not mandatory, but the board has noted a lack of expert testimony in denying petitioners' grounds.10 A relevant, detailed expert declaration that discloses the underlying facts and data upon which the opinions within it are based will typically be accorded substantial weight by the board. Indeed, the board has explained, in response to objections that an expert declaration is simply an attempt to circumvent the page limits, that declarations are not considered argument, but are evidence.11

But just as the board dismisses conclusory attorney argument in petitions, it also accords little weight to conclusory expert opinion.12 The board further disapproves of testimony that merely mimics or tracks the language of the petition itself. In Wowza v. Adobe, the board observed that the declaration appeared “simply to track and repeat the arguments for unpatentability presented in the Petition,” and found petitioners' declaration “no more helpful tha[n] the Petition.”13 The board further criticized petitioners' “general” citations to the 100-page declaration, finding they lacked specificity and failed to point to specific testimony that may have related to specific claim limitations.

Propose Constructions With Appropriate Support for All Contested Claim Terms

Every claim term need not be defined,14 but in their petitions, petitioners should offer constructions for any and all terms they believe will be contested during the proceeding. At the same time, they should explain why their proposed constructions are correct. The board's rules require as much.15 To the extent a petitioner fails to identify any term that the board believes should be construed, the board may construe the term on its own, resulting in a potentially unfavorable construction--or at least one in which the petitioner has no say. In Synopsis v. Mentor Graphics, the petitioner failed to specifically construe any claim term, contending that all of them should be given their ordinary meaning.16 The board, however, disagreed and construed four terms which it relied upon at least in part in declining to institute an IPR for a number of the proposed claims.

Even if the board declines to construe an identified claim term in instituting review, the parties should consider proposing their own claim constructions (if they have not already), as the board reserves the opportunity to construe terms at a later time.17 But note that even construed claims are not final and may be reconstrued by the board after institution.18

Claim terms the petitioner has not identified may also be proposed and construed by patent owners. In fact, where patent owners believe that relevant terms have not been proposed by petitioners, they should be proactive in identifying and construing such terms.19 Patent owners should consider proposing such constructions with appropriate support in their preliminary responses. Advantageously to patent owners in such cases, the board is likely to construe these terms in its decision on institution without any input from the petitioner.

Correspondingly, patent owners should oppose any constructions put forth by petitioners that they disagree with. In Synopsis, the board accepted petitioner's “ordinary meaning” constructions for many terms, explaining that “[b]ecause this position is not challenged by Patent Owner, we adopt it.”20 But even where both parties have advocated constructions, they should not be surprised if the board adopts its own construction.21

Petitioners and patent owners should also recognize that despite the differing claim-construction standards at the board (broadest reasonable interpretation, also known as “BRI”) and the district courts (“ordinary and customary meaning” in accordance with Phillips v. AWH22), the board often considers the parties' statements before the district court as well as the court's constructions. Given that approximately two-thirds of IPR proceedings and almost all of CBM proceedings have co-pending district court litigations, this is an important consideration. According to the board, “[s]tatements made in a related litigation may shed useful light to the meaning of the claim terms.”23 The board does note, however, that “statements made in the course of litigation may include some degree of bias and may support an interpretation more narrow than the broadest reasonable interpretation given by the Office.”24 In any case, the parties should carefully consider their claim constructions in light of those proposed in district court. And regardless of what constructions the parties put forth, they should support them with evidence, such as the patent specification and pertinent dictionary definitions.25

Always Be Prepared

Given the nature of these contested proceedings, including the fact that the board must render a final decision within one year after institution (absent good cause), the party most prepared for any and all eventualities and ready to adapt will hold an advantage. For instance, routine teleconferences with the board may include a single administrative patent judge, the full panel, or even an expanded panel. And parties should always be prepared to discuss substantive positions--even on seemingly procedural calls. The parties should also be aware that the board may be willing to address or at least entertain some discovery disputes even prior to any decision on institution.26 Indeed, the parties must raise discovery issues at the right time or the board may not entertain them.

Patent owners in particular should be on notice that the board may set an expedited time period for submitting a preliminary response,27 especially in cases where the petition is the second such petition involving the same patent. More importantly, patent owners should be prepared for the board to issue a scheduling order with a shortened response time, leaving patent owners just weeks to respond following institution of an IPR or CBM review,28 rather than the approximately two-month time period the board has been giving most patent owners. In this short amount of time, patent owners must be ready to conduct discovery, cross-examine petitioner's experts, prepare any expert declarations and respond to the board's decision. Thus, even if a patent owner decides to forgo a preliminary response, it is critical that the patent owner begin formulating its response and vetting experts as soon as it receives a petition.


The first 15 months of IPR and CBM proceedings has seen a steady increase in both IPR and CBM filings with no sign of abatement. Despite the relatively few final decisions that have made it through the pipeline, it has become abundantly clear that these proceedings will be an important tool to challenge patents.

With parties growing more familiar with the process and the board's growing volume of decisions, there is far less room for error than in the first few months of contested proceedings under the America Invents Act. Parties should retain counsel well versed in the board's rules and practice.

Lastly, successful parties must be ready for every challenge and adapt as necessary in recognition of the speed of the proceedings and the board's increasing workload.

1 Tasco, Inc. v. Pagnani, IPR2013-00103, Paper No. 6 at 10-11 (May 23, 2013).

2 Avaya Inc. v. Network-1 Sec. Solutions, Inc., IPR2013-00071, Paper No. 18 at 28 (May 24, 2013).

3 Denso Corp. v. Beacon Navigation GmbH, IPR2013-00027, Paper No. 12 at 17-18 (Apr. 2, 2013).

4 Liberty Mut. Ins. Co. v. Progressive Cas. Ins. Co., CBM2012-00003, Order at 2-3 (Oct. 25, 2012).

5 Dominion Dealer Solutions, LLC v. AutoAlert, Inc., IPR2013-00222, Paper No. 12 at 29-31 (Aug. 13, 2013); Avaya, IPR2013-00071, Paper No. 18 at 28.

6 Liberty Mutual, CBM2012-00003, Order at 3.

7 Intelligent Bio-Systems, Inc. v. Illumina Cambridge Ltd., IPR2013-00324, Paper No. 19 at 5-7 (Nov. 21, 2013) (citing 35 U.S.C. §325(d)).

8 Norman Noble, Inc. v. NUTech Ventures, IPR2013-00101, Paper No. 14 at 10 (June 20, 2013) (citing 77 Fed. Reg. 48,763 (Aug. 14, 2012).

9 37 C.F.R. § 42.107(c).

10 Noble, IPR2013-00101, Paper No. 14 at 9; Redline Detection, LLC v. Star Envirotech, Inc., IPR2013-00106, Paper No. 17 at 12 (July 1, 2013).

11 Research in Motion Corp. v. Multimedia Ideas LLC, IPR2013-00036, Paper No. 15 at 7-8 (Mar. 18, 2013).

12 Corning Inc. v. DSM IP Assets B.V., IPR2013-00052, Paper No. 13 at 17 (May 2, 2013).

13 Wowza Media Sys., LLC v. Adobe Sys. Inc., IPR2013-00054, Paper No. 12 at 12 (Apr. 8, 2013).

14 77 Fed. Reg. 48,700 (Aug. 14, 2012)).

15 See, e.g., 37 C.F.R. §41.104(b)(3).

16 Synopsis, Inc. v. Mentor Graphics Corp., IPR2012-00042, Paper No. 16 at 5 (Feb. 22, 2013).

17 SAS Inst., Inc. v. ComplementSoft, LLC, IPR2013-00226, Paper No. 9 at 6 (Aug. 12, 2013).

18 Garmin Int'l, Inc. v. Cuozzo Speed Techs. LLC, IPR2012-00001, Paper No. 26 at 2 (Mar. 5, 2013).

19 Avaya, IPR2013-00071, Paper No. 18 at 7-8.

20 Synopsis, IPR2012-00042, Paper No. 16 at 5.

21 The board has adopted its own claim construction, as opposed to one proposed by either party, in almost 50 percent of cases.

22 Phillips v. AWH Corp., 415 F.3d 1303, 1312-18, 75 U.S.P.Q.2d 1321 (Fed. Cir. 2005) (en banc).

23 Motorola Mobility LLC v. Arnouse, IPR2013-00010, Paper No. 21 at 7 n.2 (Feb. 12, 2013).

24 Id.

25 The board appears to be basing close to 50 percent of all its claim constructions on the patent specification and close to 20 percent on dictionary definitions.

26 See Broadcom Corp. v. Telefonaktiebolaget LM Ericsson, IPR2013-00636, Paper No. 9 (Dec. 11, 2013).

27 See e.g., Shaw Indus. Grp., Inc. v. Automated Creel Sys., Inc., IPR2013-00584, Paper No. 7 (Sept. 18, 2013).

28 See e.g., Shaw Indus. Grp., Inc. v. Automated Creel Sys., Inc., IPR2013-00584, Paper No. 17 (Dec. 31, 2013); Nuvasive, Inc. v. Warsaw Orthopedic, Inc., IPR2013-00395, Paper No. 13 (Dec. 20, 2013).

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