Review of PTAB Trial Orders Debated by CAFC
In recent weeks, the CAFC has twice considered whether or not the trial orders of the USPTO's Patent Trial & Appeal Board (PTAB) become appealable once a final written decision is issued. First, on November 3, 2014, the CAFC heard arguments directed to this issue in In re Cuozzo Speed Technologies LLC. The Cuozzo appeal stemmed from the very first Inter Partes Review (IPR) ever filed. Cuozzo appealed the Board's determination of unpatentability and argued that the IPR never should have been instituted in the first place. This past Wednesday in an appeal stemming from the very first CBM filed, Versata Development Group v. SAP America, Inc, a similar threshold argument was made to the Court.Can the CAFC consider an otherwise nonappealable PTAB trial order in reviewing a final written decision?
Aqua Products: A Gift to the PTAB
Yesterday I explained why In re Aqua Products would not result in PTAB Motions to Amend being any more attractive or ultimately successful. This is because Motions to Amend are rarely advisable in litigation scenarios given intervening rights. And even where viable, such infringement-inspired amendments are almost always too incremental in nature to distinguish over the art. That said, Aqua Products is an absolute game changer for the agency itself.
With the burden of patentability now offloaded from the Motion to Amend, such motions can now be entered (i.e., granted) before reaching the ultimate question of whether or not the amended claim is actually patentable. As upward of 60% of pre-Aqua motions failed on patentability grounds, one can expect that the grant rate of such motions to now exceed 60%.
For this reason, Aqua Products is manna from heaven for the agency.
Since the PTAB’s inception, the number one rallying cry of critics has been the perceived inability to amend. When BRI was attacked in In re Cuozzo, it was argued that since the ability amend was the justification for BRI — but the PTAB didn’t allow amendment — BRI must be dropped. When the BRI attack failed in Cuozzo, the debate shifted to the amendment process itself in Aqua Products. But that too has now backfired.
As explained in Aqua Products, what the Federal Circuit has done is to free the PTAB of its most significant PR problem.
[T]he patent owner may proffer amendments that propose to cancel any challenged claim and propose a reasonable number of substitute claims as long as the substitute claims (1) do not impermissibly enlarge the scope of the claims, and (2) do not introduce new subject matter. 35 U.S.C. § 316(d)(1), (d)(3). These requirements describe a threshold showing the Board must deem satisfied before the amended claims can be considered in—i.e., “entered into”—an IPR. This showing by the patent owner is not the same as the burden of proof on the question of patentability.
The “request” made by a motion to amend is—in the PTO’s own words—for “entry” into the IPR, not for entry of an amended claim into the patent. Once entered into the proceeding, the amended claims are to be assessed for patentability alongside the original instituted claims.
So, post-Aqua, one can expect the granting of Motions to Amend to improve to 60% or greater, but the ultimate determinations of patentability to remain unchanged.