Post-Grant Proceedings

Indian tribes ability to shield patents from review at the United States Patent and Trademark Office’s (“USPTO”) Patent Trial and Appeal Board (“PTAB”) took another blow at the Federal Circuit.  The Federal Circuit in a precedential decision, affirming the decision of the PTAB, held that tribal sovereign immunity cannot be asserted in inter partes review (“IPR”) proceedings before the PTAB.[1]

The Federal Circuit based the decision on two principles extrapolated from Supreme Court decisions.  First, the general proposition that “immunity does not apply where the federal government acting through an agency engages in an investigative action or pursues an adjudicatory agency action.”[2]  Second, the Supreme Court’s recognized distinction between adjudicative proceedings brought by a private party against a state, on the one hand, and federal agency-initiated enforcement proceedings, on the other.  According to the Federal Circuit, immunity may generally be invoked in the private party actions, but not in the federal agency-initiated enforcement proceedings. Continue Reading Tribal Immunity Cannot Be Asserted to Escape IPR Proceedings

The USPTO announced today proposed rulemaking for changing its policy related to claim interpretation in Patent Trial and Appeal Board (“PTAB”) proceedings (not including patent examination). Currently, the broadest reasonable interpretation (“BRI”) standard is applied when analyzing claims. The proposed new rules would result in “the same as the standard applied in federal district courts and International Trade Commission (“ITC”) proceedings;” i.e., “ordinary and customary meaning” according to “a person of ordinary skill in the art in question at the time of the invention,”[1] and “reasonable certainty” for definiteness analysis[2]. In addition, it is proposed that the USPTO/PTAB “will consider any prior claim construction determination concerning a term of the involved claim in a civil action, or an ITC proceeding, that is timely made of record in an IPR, PGR, or CBM proceeding.” Continue Reading USPTO Announces Notice of Proposed Rulemaking for Claim Construction Standard used in PTAB Proceedings

SAS Institute Inc. v. Iancu

As we recently noted in our companion piece Part 1 of 2: Supreme Court and Inter Partes Review, the Supreme Court issued decisions in two intellectual property appeals relating to inter partes review (“IPR”) before the U.S. Patent and Trademark Office. In Oil States Energy Services LLC v. Greene’s Energy Group LLC, No. 16-712, the Court decided 7–2 that the inter partes review process does not violate Article III of the Constitution or the Seventh Amendment. In SAS Institute Inc. v. IANCU, No. 16-969, the Court decided that the Patent Trial and Appeal Board (“PTAB”) must decide the patentability of all of the claims the petitioner has challenged rather than selectively picking and choosing which claims to review. In response to the Court’s decision in SAS, the PTAB has already issued new guidance regarding the institution of IPRs. Continue Reading Part 2 of 2: Supreme Court and Inter Partes Review

Oil States Energy Services LLC v. Greene’s Energy Group LLC

On April 24, 2018, the Supreme Court issued decisions in two intellectual property appeals relating to inter partes review (“IPR”) before the U.S. Patent and Trademark Office. In Oil States Energy Services LLC v. Greene’s Energy Group LLC, No. 16-712, the Court decided 7–2 that the inter partes review process does not violate Article III of the Constitution or the Seventh Amendment. In SAS Institute Inc. v. IANCU, No. 16-969,  the Court decided that the Patent Trial and Appeal Board (“PTAB”) must decide the patentability of all of the claims the petitioner has challenged rather than selectively picking and choosing which claims to review.  In response to the Court’s decision in SAS, the PTAB has already issued new guidance regarding the institution of IPRs. Continue Reading Part 1 of 2: Supreme Court and Inter Partes Review

As a special feature of our blog, we include special guest postings by experts, clients, and other professionals—please enjoy this blog entry which includes guest author Rolf J. Haag.[1]

It has been impossible to miss the surreal volatility in Bitcoin’s per unit price—having gone from $1,000 in January 2017 to almost $20,000 (~$750B mkt. cap) toward the end of last year and retracting to under $8,000 (~$500B mkt. cap) in February 2018. Whether these G-LOC-inducing price undulations are reflective of a radical paradigm shift in the mode of financial transactions, history’s greatest pyramid scheme, or some mix thereof, remains to be seen. Continue Reading Will Blockchain Revolutionize Bio/Pharma R&D, Tech Transfer, and IP?

In an unprecedented move by the U.S. Patent and Trademark Office (USPTO), the Patent Trials and Appeals Board (PTAB) has permitted the filing of amicus briefs on whether the Saint Regis Mohawk Tribe (“Tribe”) should be permitted to terminate the inter partes review of Allergan’s patents contested in IPR2016-00127, IPR2016-01128, IPR2016-01129, IPR2016-01130, IPR2016-01131, and IPR2016-01132. Allergan assigned the patents challenged in these IPRs to the Tribe, while retaining an exclusive license in exchange for ongoing payments. As a sovereign entity, the Tribe seeks to terminate the IPR challenges of these patents, a move which the PTAB had ruled in 2016 shielded the University of Florida Research Foundation as a sovereign entity from IPRs. See Covidien LP v University of Florida Research Foundation Inc., IPR2016-01274, Paper 21 (PTAB Jan. 25, 2016). Amicus briefs of no more than 15 pages are due to be filed by December 1, 2017, and the Petitioners and Tribe are each authorized to file a single response to any amicus brief by December 15, 2017.

This maneuvering has caught the attention of many, including members of Congress and the district court specifically addressing the validity of these patents. In response to a bipartisan committee investigating the Allergan-Tribe deal, Senator McCaskill has already drafted a bill to block tribal claims of sovereign immunity, which could otherwise preclude USPTO review of patents assigned to tribes. Court of Appeals for the Federal Circuit Judge William Bryson, sitting by “designation” in the Eastern District Court of Texas, expressed concerned that Allergan sought to “rent” sovereign immunity from the Tribe. On the other hand, heralded as an innovative defense, patent attorneys now seek such a defense to patent challenges before the USPTO. The Saint Regis Mohawk Tribe has reportedly already taken ownership of patents from SRC Labs and is in discussion with another technology company.

Interestingly, the district court under Judge Bryson recently found four of the six patents invalid, a decision which will likely be appealed to the CAFC. However, the PTAB nevertheless will need to answer, inter alia, the question of  whether the Tribe’s right as a sovereign immunity will shield the Allergan patents from IPRs. Due to additional parties joining as Petitioner and the complicated issues surrounding this challenge, the PTAB has extended a deadline to render its final decision in the IPR from December 8, 2016, to April 6, 2018.

The America Invents Act (“AIA”) provides for post grant challenges of U.S. patents in the Patent Trial and Appeal Board (“PTAB”) of the U.S. Patent and Trademark Office. One type of AIA proceeding, Inter Partes Review (“IPR”), came into effect in September 2012, and provides a process for relatively quick determination of invalidity of challenged patent claims based on published prior art. [1] IPR decisions rendered in the past five years have created a body of law addressing a variety of issues related to invalidity challenges before the PTAB. In a recent IPR proceeding, a novel strategy has arisen that posts an interesting question of first impression, whether the assignment of a patent involved in an IPR proceeding to a U.S. Indian tribe can avoid an IPR proceeding based on a sovereign immunity defense. The present blog post summarizes the new issue that the PTAB will be required to decide in the IPR. Continue Reading Indian Tribal Sovereign Immunity Asserted in an IPR

shutterstock_492045028In Commil v. Cisco Systems, the Federal Circuit held that “evidence of an accused inducer’s good-faith belief of invalidity may negate the requisite intent for induced infringement.” CITE. The court’s opinion did not explore the proof needed to show good faith, but it is reasonable to expect that a competent opinion of counsel may meet this requirement, potentially resurrecting the importance of invalidity opinions.

The relevance of opinions of counsel during litigation has been diminished in the willfulness context. Before 2004, accused infringers who were aware of a competitor’s patent had a duty to obtain competent legal advice before engaging in any potentially infringing activity. If they didn’t fulfill this duty, the jury was allowed to draw an “adverse inference” against the defendant during trial. In 2004, the Federal Circuit eliminated the jury’s ability to draw such an adverse inference. Knorr-Bremse Systeme Fuer Nuetzfahrezeuge GMBH v. Dana Corp., et al.

Congress has since codified the Knorr-Bremse holding for AIA patents, stating that “[t]he failure of an infringer to obtain the advice of counsel with respect to any allegedly infringed patent, or the failure of the infringer to present such advice to the court or jury, may not be used to prove that the accused infringer willfully infringed the patent or that the infringer intended to induce infringement of the patent.” 35 U.S.C. § 298. This statute thus addresses both willful infringement and induced infringement, eliminating negative inferences from the failure to produce such evidence. But the statute, of course, does not prohibit using opinions of counsel as evidence of lack of intent.

Indeed, citing previous case law, the Federal Circuit in Commil v. Cisco Systems reiterated that opinions of counsel regarding non-infringement were admissible to show the defendant’s state of mind and its bearing on indirect infringement. CITE. The Federal Circuit has now opened the door for using opinions of counsel to show good faith belief of invalidity. The Supreme Court granted certiori and heard oral arguments in this case on March 31, 2015, and may keep that door open in its final opinion.

If the Court agrees with the Federal Circuit, it appears up for debate whether opinions of counsel of invalidity under the PTAB standards of claim construction and burden of proof will be sufficient. The Federal Circuit has affirmed that the broadest reasonable construction standard is appropriate at the PTAB, making it easier to invalidate patents than in District court in most instances. Also, the well-known lower burden of proof to show invalidity at the PTAB makes this a more attractive venue for patent challengers. For example, if a patent is upheld in district court, will a competent opinion of counsel of invalidity under the PTAB standards be sufficient to show good faith?

In-house counsel charged with asserting patent rights, as well as generic and biosimilar counsel at life science companies no doubt are watching this case closely, especially with regard to method claim patents. Most of the time, if direct infringement of such claims occurs, it is by physicians, whereas the companies manufacturing the drug will be the inducers. Of course, the drug manufacturers will be who the patent holders will want to go after for damages. If a good-faith belief of invalidity is sufficient to negate the specific intent for induced infringement, opinions of counsel regarding invalidity will become very important to generics and biosimilar manufacturers alike.

Jushutterstock_147164960dge Newman’s dissent in Enzoidemonstrates that the Federal Circuit is struggling with how much deference to give to a district court’s claim construction in view of the Supreme Court’s ruling in Teva.ii

In Enzo, the majority found that the district court’s claim construction of the phrase “at least one component of a signaling moiety,” was incorrect when reviewing the intrinsic evidence and taking into account the ordinary and customary meaning of the term “component.”iii The court pointed to a number of instances in the specification where the only examples of “signaling moiety” required at least two components and thus the claims encompassed only indirect detection.iv This was contrary to the district court’s claim construction, which determined that direct detection of the signaling moiety without an additional compound was also encompassed by the claims.v

However, the majority seemed to gloss over the specific factual findings supported by expert testimony that, in fact, at least one example in the specification did support a construction that “at least one component” could mean a single signaling moiety.iv Instead, the Federal Circuit noted that “this sole factual finding does not override our analysis of the totality of the specification.”vii In addition, rather awkwardly, the Federal Circuit dismissed the use of claim differentiation used by the district court to support its holding, stating that a dependent claim cannot broaden claim 1.viiiThis conclusion, however, came only after the majority first found claim 1 should have been construed more narrowly.

In the dissent, Judge Newman identifies several instances where the majority failed to follow the Supreme Court’s holding in Teva. For instance, she argues that the majority opinion “ignore[s] the testimony and the district court’s findings and the jury verdict based on the evidence at trial.”ix As argued by Judge Newman, the majority reviewed all aspects of the claim construction under a de novo standard, rather than reviewing the findings of fact that the district court found critical to its decision for clear error.x

With Enzo, it would appear that the Federal Circuit is reluctant to let go of its hold on the review of claim construction. Perhaps when the district court relies more heavily on expert testimony, its claim construction would be given more deference. But according to Judge Newman, the majority “show[s] error in neither fact nor law in the court’s findings and conclusions,”xi which makes it difficult to predict the court’s reasoning in subsequent claim construction rulings.

i Enzo Biochem, Inc. v. Applera Corp., 780 F.3d 1149, 1157-59 (Fed. Cir. 2015).
ii Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831 (2015).
iii Enzo, 780 F.3d at 1154.
iv Id. at 1155.
v Id. at 1153.
vi Id. at 1155-56.
vii Id. at 1156.
viii Id.
ix Id. at 1159.
x Id.
xi Id.