A brief overview of Inter Partes Review of patents

1. Inter Partes Review
of Patents
Richard P. Beem
Beem Patent Law Firm
www.BeemLaw.com
Chicago, IL US
© Beem Patent Law 2015
Permission is granted to reproduce with attribution
1
Chicago Bar Association
Intellectual Property Law Committee
March 24, 2015

2. What is PTAB?
• Patent Trial and Appeal Board
• Instituted as a result of AIA
• Formerly, BPAI – Board of Patent Appeals and
Interferences
• Appeals from patent prosecution
• Post Grant Procedures
• Chief judge, lead judges
• PTAB webpage: www.uspto.gov/patents-application-process/patent-
trial-and-appeal-board-0
2

3. Post-Grant Procedures
• Post-Grant Procedures
• Post Grant Review (PGR)
• Inter Partes Review (IPR)
• Covered Business Method (CBM)
• IPR is most popular of post-grant procedures
3

4. Major Differences between IPR, PGR, and CBM
Post Grant
Procedure
Petitioner Estoppel Standard Basis
Post Grant Review
(PGR)
• Person who is not the patent
owner and has not previously
filed a civil action challenging
the validity of a claim of the
patent
• Must identify all real parties in
interest
• Raised or reasonably
could have raised
• Applied to subsequent
USPTO/district court/ITC
action
More likely than not
OR
Novel or unsettled legal
question important to other
patents/
applications
101, 102, 103, 112,
double patenting
but not best mode
Inter Partes
Review (IPR)
• Person who is not the patent
owner, has not previously filed
a civil action challenging the
validity of a claim of the
patent, and has not been
served with a complaint
alleging infringement of the
patent more than 1 year prior
(exception for joinder)
• Must identify all real parties in
interest
• Raised or reasonably
could have raised
• Applied to subsequent
USPTO/district court/ITC
action
Reasonable likelihood 102 and 103 based
on patents and
printed publications
Covered Business
Method (CBM)
• Must be sued or charged with
infringement
• Financial product or service
• Excludes technological
inventions
• Must identify all real parties in
interest
• Office—raised or
reasonably could have
raised
• Court-raised
Same as PGR Same as PGR (some
102 differences)
4Source: USPTO

5. Major Differences between IPR, PGR, and CBM
Post Grant Procedure Petitioner
Post Grant Review (PGR) • Person who is not the patent owner and has not previously filed a
civil action challenging the validity of a claim of the patent
• Must identify all real parties in interest
• Must be filed within 9 months of issue date
Inter Partes Review (IPR) • Person who is not the patent owner, has not previously filed a civil
action challenging the validity of a claim of the patent, and has
not been served with a complaint alleging infringement of the
patent more than 1 year prior (exception for joinder)
• Must identify all real parties in interest
• Cannot be filed until 9 months after issue date
• Must await decision on any pending PGR petition
Covered Business Method
(CBM)
• Must be sued or charged with infringement
• Financial product or service
• Excludes technological inventions
• Must identify all real parties in interest
5Source: USPTO

6. Major Differences between IPR, PGR, and CBM
Post Grant
Procedure
Estoppel Standard Basis
Post Grant Review
(PGR)
• Raised or reasonably
could have raised
• Applied to subsequent
USPTO/district court/ITC
action
More likely than not
OR
Novel or unsettled legal
question important to other
patents/applications
101, 102, 103, 112,
double patenting
but not best mode
Inter Partes
Review (IPR)
• Raised or reasonably
could have raised
• Applied to subsequent
USPTO/district court/ITC
action
Reasonable likelihood 102 and 103 based
on patents and
printed publications
Covered Business
Method (CBM)
• Office—raised or
reasonably could have
raised
• Court—raised
Same as PGR Same as PGR
(some 102
differences)
6Source: USPTO

7. Why Inter Partes Review?
• Because district court litigation is expensive
• Similar to European invalidation procedures
• Faster, cheaper decision
• District courts aren’t technical
7

8. When to Use Inter Partes Review?
• File promptly if sued for patent infringement
• Requirements: timing
• Petition for IPR will be barred if it is “filed more than 1 year after
the date on which the petitioner, real party in interest, or privy of
the petitioner is served with a complaint alleging infringement of
the patent.” 35 U.S.C. §315(b)
• Cannot be filed until 9 months after issue date
• Must await decision on any pending PGR petition
• Can’t file civil action for D.J. of invalidity in D.Ct. 35 U.S.C. §315(a)
• Limited to §§102, 103 based on patents and printed publications 35
U.S.C. §311(b)
• Decision: roughly 18 months
8

9. IPR Procedure
• Petition
• Preliminary response optional
• Institution (90% of petitions result in trial being
instituted)
• Discovery
• Motion practice: must arrange telecon to get permission
to file motion; often decided on the spot without a
motion
9

10. Inter Partes Review Timeline
10Source: USPTO

11. 3 months
Petition
Filed
No More than
3 months
PO
Preliminary
Response
(optional)
3 months
Decision on
Petition
11

12. 12
3
months
Decision on
Petition
3
months
PO Response
& Motion to
Amend
Claims
Petitioner Reply
to PO Response
& Opposition to
Amendment
PO Discovery PeriodPetitioner Discovery PeriodPO Discovery Period
No more than 12 months for discovery

13. 13
1 month
Petitioner
Reply to PO
Response &
Opposition to
Amendment
Hearing
Set on
Request
PO Reply to
Opposition
to
Amendment
Oral
Hearing
Final
Written
Decision
Period for Observations
& Motions to Exclude
Evidence
PO Discovery Period
No more than 12 months for discovery

14. IPR Petitions
• The petition is your
entire case-in-chief
• Support it with expert
testimony (evidence) in the
form of a declaration
• Page limit and formatting
requirements (37 C.F.R. 42)
• Review Request fee and
Post-Institution fee upfront
($23,000+)
Fee Code Fee Description Amount
1406 IPR review request fee–
up to 20 claims
$9,000
1414 IPR review post-
institution fee–up to 15
claims
$14,000
1407 IPR review request in
excess of 20
$200/claim
1415 IPR post-institution
request in excess of 15
$400/claim
14

15. IPR Petitioners:
Your petition is your day in court.
• This is not notice pleading
• Make your petition tight
• Present best arguments only
• Make it complete
15

16. IPR Petition Length and Format
• 60 page limit
• 14 pt. font, double spaced
• No arguments in claim chart
• Intended to prevent circumvention of page/font/spacing
requirements
• Assertions on knowledge of one of ordinary skill may be
objectionable as argument
16

17. IPR Petitions
• How do you know what claims to challenge?
• What if there are 162 claims?
• Most cases do not dispose of all claims
17

18. IPR Petitions Terminated by January 15, 2015
• 20,206 Claims in 617 Patents Petitioned
• 9,048 Claims Challenged
• 6,114 Claims Instituted
• 68% of Claims Challenged
• 425 of 617 Petitions
• 2,176 Claims Found Unpatentable
• 36% of Claims Instituted
• 24% of Claims Challenged
• 173 of 617 Petitions
18Source: USPTO

19. Grounds Must Not be Redundant (I)
• Take your best shot with one §102 or two §103 prior art
references—patents or publications
• A “publication” is theoretically available but often it
won’t be sufficiently complete
• Not public use—that will have to wait for D.Ct.
• Must not be redundant (hundreds of grounds were
advanced, PTAB said cut it down, or when we get to
first redundant ground, we’re stopping)
• Claim construction
19

20. Grounds Must Not be Redundant (II)
• Note: decisions often include little analysis to support
the redundancy conclusion.
• Permobil v. Pride Mobility Products, IPR2013-00407
• Instituted review based on 2 of 13 combinations of prior art.
• Denied petitioner's proposed alternate grounds as redundant
20

21. Decision Points for Patent Owner
• Think twice before filing infringement suit – expect IPR
• Get started immediately, including getting experts onboard
• Preliminary response is optional and cannot include expert
evidence
• Pros and cons of filing prelim response
• If instituted, PO may take discovery and file response
• Support with expert testimony
• Motion to amend claims permitted
• First must confer with Board
• Likelihood: fuhgeddaboutit
21

22. Experts
• Why an expert? Because that’s evidence.
• Monsanto Company v. Pioneer Hi-Bred International, Inc., IPR2013-00022
• Monsanto’s expert testimony not considered because conclusory. Left only attorney
argument and prior art. Denied Monsanto’s petition.
• Not submitting expert testimony makes Board more likely to find in favor of opposing
expert.
• But see
• Biodelivery Sciences Int'l, Inc., Petitioner, IPR2014-00325.
• PTAB expects affidavits/declarations of experts (in complex cases).
• However, “expert testimony is not a per se requirement.”
• Primera Tech., Inc., Petitioner, IPR2013-00196
• PTAB “reject[s] the notion that the failure to present expert testimony on a position presented in a
petition necessarily compels us to ignore or excuse that position.”
22

23. Motions to Stay—District Court
• Accused infringer: File motion to stay?
• When to file motion to stay (timing of IPR)?
• What if District Court refuses to stay?
23

24. Treatment of AIA’s four-factor test for stay:
• File motion early, perhaps before PTAB issues decision on whether to institute IPR
• Including all asserted patent claims in instituted IPR proceeding weighs heavily in
favor of stay
• Can no longer successfully argue that stay should be denied because IPR will likely
not result in finding of invalidity. Improper collateral attack.
• Motion to amend patent claims in IPR weighs in favor of stay because potentially
changing claim language may complicate claim construction if stay is not granted.
• Failure of patentee to seek preliminary injunction weighs in favor of stay because its
goes against argument that patentee will be prejudiced without stay
• delay by patentee in filing suit weighs in favor of stay because it also weighs against
prejudice absent stay
• Alleged loss of evidence due to witnesses’ ages will not be given much weight
—VirtualAgility Inc. v. Salesforce.com, Inc., No. 2014-1232
24

25. Settlement and Termination of IPR (I)
• Settlement
• Mediation – private
• Requires board approval
• Termination not automatic
• How: request phone conference, get permission to file
motion, state why PTAB should dismiss after finding
good grounds to institute
• What must be filed on the record
25

26. Settlement and Termination of IPR (II)
• Settlement does not guarantee termination of proceeding. Section 317 provides that “Office
may terminate the review or proceed to a final written decision under section 318(a).”
• Less inclined to terminate when settlement occurs at an advanced stage. Settle early and
before final briefings are filed
• Blackberry Corp. v. Mobilemedia Ideas, IPR2013-00016
• Declined to terminate when parties filed joint motion to terminate seven months after institution and one day before
oral hearing
• Blackberry v. MobileMedia, IPR2013-00036
• Declined to terminate when the parties fully briefed issues and oral hearing had already taken place
• But see
• IBM Corp. v. Financial Systems Technology, IPR2013-00078
• Agreed to terminate proceedings settled during petition stage.
• Hitachi Cable America Inc. v. Belden Inc., IPR2013-00408
• Agreed to terminate proceedings settled within first few months of trial.
• Sony Corp. v. Tessera, Inc., IPR2012-00033
• Agreed to terminate proceedings ten days before oral argument.
26

27. Terms of Art in IPRs
• Petition (want to have all ducks in a row – this is your
whole case!)
• Institute Trial (paper record! Not what we normally
think of).
• Oral Hearing (judges are well prepared; come into it
with a tentative decision).
27

28. Key Learnings and Take-Aways
• On timeline, at minus 2-3-5 years, file better, more thorough
patent applications after good prior art search; make sure claims
distinguish over prior art
• Aim for IPR-proof patents
• IPR may not dispose of all issues
• IPR petitioner: your petition is your trial present your entire best
case-in-chief including written expert testimony in form of
declaration and claim charts with one or two best prior art
references
• For both parties: thorough preparation with expert support is
key; start early and allow plenty of time
• District Court infringement litigation has cooled
• An IPR-proved patent is golden (estoppel – yet TBD)
28

29. Questions?
© Beem Patent Law 2015 29

30. Thank you!
© Beem Patent Law 2015 30
Richard P. Beem
Beem Patent Law Firm
www.BeemLaw.com
Presentation (subject to revisions) is intended to be posted on SlideShare:
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Visit our blog, Beem on Patents, for additional updates and information on patent law and
IPRs: www.beemonpatents.com