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  • The opinions, commentary and characterizations provided to this online forum by the authors and moderators are provided for encouraging discussion, thought and debate on important post grant issues. These postings are in no way representative of the opinions of Oblon Spivak et al., or its clients.

Post Grant Patent Challenges To Threaten Continuation Portfolios

Posted On: Sep. 13, 2012   By: Scott A. McKeown
continuation applicationContinuation Applications to be Collateral Damage to PTAB Proceedings?

The new patent validity trials of the Patent Trial & Appeal Board (PTAB), Post Grant Review (PGR), Transitional Program for Covered Business Method Patents (TPCBMP), and Inter Partes Review (IPR) introduce a new layer of estoppel for PatenteesThis estoppel, once triggered by claim cancellation or refusal by the Patent Trial & Appeal Board (PTAB), could operate to effectively forfeit a Patentee’s continuation application portfolio.

The danger is significant as it is common practice for many Patentees to maintain continuation patent applications long after the issuance of a first patent. The pending continuation applications allow Patentees to adapt/refine their claims to changing products of the marketplace such as when competitors attempts to ”design around” the claims of the initially issued patent. In this way, a robust continuation portfolio serves as a further hedge against infringement of the base patent. Indeed, for many large stakeholders, continuation patent application portfolios constitute a major investment.

Once a patent is challenged in a petition for IPR, PGR, or TPCBMP, what can a patentee do to protect their investment in continuation patent applications?

First, let’s start with the rule that creates the “patentee estoppel” of the new post grant trials, Rule 42.73(d)(3). The rule provides as follows:

(3) Patent applicant or owner. A
patent applicant or owner whose claim
is canceled is precluded from taking
action inconsistent with the adverse
judgment, including obtaining in any
(i) A claim to substantially the same
invention as the finally refused or
cancelled claim;
(ii) A claim that could have been filed
in response to any properly raised
ground of unpatentability for a finally
refused or cancelled claim; or
(iii) An amendment of a specification
or of a drawing that was denied during
the trial proceeding.

(3) Patent applicant or owner. A patent applicant or owner is precluded from taking action inconsistent with the adverse judgment, including obtaining in any patent:

(i) A claim that is not patentably distinct from a finally refused or cancelled claims; or

(iii) An amendment of a specification or of a drawing that was denied during the trial proceeding, but this provision does not apply to an application or patent that has a different written description.

(emphasis added)

As can be appreciated, the lack of patentable distinction between a continuation application and a previously issued patent, for many large patent filers, is a trivial concern in light of widespread terminal disclaimer practice. However, going forward, large patent filers will be wise to avoid such situations as the same patentable distinction analysis may now doom a continuation patent application.

Consider the situation where a parent patent has a broad, generic claim that is cancelled or refused in a post grant trial of the PTAB. If the continuation (or reissue) applications present claims of indistinct scope to that which was cancelled or finally refused, and if one assumes that the specification is identical in relevant respect, the Patentee is estopped from pursuing the pending continuation claim. As the PTAB will operate under the premise that the continuation application claim should be barred under Rule 42.73(d), the Patentee would be effectively forced to introduce the indistinct, continuation claims in the PTAB proceeding, or lose them. Yet, the trial rules do not provide a mechanism for introducing claims en masse outside of a “reasonable number of substitute claims.” In fact, a reasonable number of claims is defined as those presented in one-to-one correspondence with respect to cancelled claims. Therefore, the best strategy is to avoid such a dilemma, but how?

Preemptive Model

Continuation practice should be avoided in favor of a parallel divisional application practice. That is to say Patentees should present multiple claim sets in a single filing to encourage restriction by the USPTO, necessitating the filing of divisional applications. Once claims are restricted, which practically speaking seems to occur anytime there are more than 20 or so claims in a single application (irregardless of the propriety of the restriction), the Office has essentially issued a finding that the claims are patentably distinct.

This step may seem extreme. But, for patent filers with large, actively licensed portfolios, especially those directed to telecommunications standards, such preventative efforts make sense as a general practice.

After-the-Fact Model

For those with smaller portfolios, or those caught in the cross hairs of a newly filed petition in the coming weeks, there are far fewer options.

The PTAB proceeding will be pending from petition filing to decision for roughly 17-24 months (5-6 month petition phase, followed by 12-18 months of trial phase). During this time, continuation claims should be collected and refiled in a single application to force restriction, or accelerated to the extent possible. Yet, the PTAB will have jurisdiction over these filings once a trial is instituted, and they have broad powers to stay such proceedings.

A “poison pill option” would seek to exploit an oversight in the rule. Keep in mind that patentee estoppel is only triggered by an “adverse judgment” that “finally refused or cancelled claims.” Arguably, the rule would not seem to embrace claims that are statutorily disclaimed (i.e., not “finally refused or cancelled”). Thus, a Patentee may choose to battle it out at the PTAB for a period of time. When it becomes clear that the written decision is very likely to be adverse to the patent, it may be wiser to statutorily disclaim the subject claims (or perhaps just the broadest claims) in the interests of preserving the continuation portfolio.

And, of course, you can try to settle the trial before an adverse decision….or just win :)

3 Responses to “Post Grant Patent Challenges To Threaten Continuation Portfolios”

  1. Brian says:


    Have you seen anything in the comments/discussion about whether this estoppel would bar the patentee in ex parte reexamination proceedings? If for example, a narrower claim is invalidated in IPR, will the patentee be precluded from defending a broader claim in a related application during reexamination?

  2. Brian,
    It’s an interesting point. For example, if an IPR successfully invalidates a narrow claim, could the challenger then throw other issued patents into reexamination (i.e., reopen prosecution) in the hopes that estoppel would prevent the Patentee from defending the claims (assuming they are patentably indistinct).

    I imagine one could argue that 42.73 relates to “obtaining” and the reexamined claims are already in force, but, the estoppel would would seem to prevent seeking amendment and/or new claims during the later reexamination. (assuming the subject claims are not patentably distinct). The existence of a terminal disclaimer relative to the IPR patent would be a big problem in that situation as it is effectively an admission on that point.

    I’ll post something next week.


  3. Brian says:

    I’d be interested in hearing your thoughts. I understand that the language refers to “obtaining.” but it’s mentioned as an example not as exhaustive.

    (3) Patent applicant or owner. A patent applicant or owner is precluded from taking action inconsistent with the adverse judgment, including obtaining in any patent:

    So if reference A is found to have all the elements of a narrower claim, on first glance it would seem that any attempt to defend a broader claim would be inconsistent with the decision.