Federal Circuit Flips Burden in PTAB Motion to Amend

For PTAB practitioners, the en banc decision in In re Aqua Products is a complete non-event. While the decision has been embraced as a net positive for Patentees, practically speaking, it will not move the needle on amending at the PTAB.

Aqua Products held that it is improper for the PTAB to place the burden of persuasion on the Patentee relative to the patentability of new/amended claims. Going forward, this burden of persuasion will rest with Petitioners (as it does for originally challenged claims 35 USC § 316(e)). (here)

While this shift may be seen as a positive for Patentees, the difficulties/unpopularity in amending at the PTAB never had anything to do with an improper shifting of the burden of patentability.

As I have pointed out previously, amendment is almost never an option for patentees at the PTAB.  This is because amendments create intervening rights.  See Laitram Corp. v. NEC Corp., 163 F.3d 1342, 1346 (Fed. Cir. 1998) (“If substantive changes have been made to the original claims, the patentee is entitled to infringement damages only for the period following the issuance of” the modified claims). As the vast majority of patents in PTAB proceedings are in active litigation, surrendering past damages by amending is typically non-starter. Not to mention, in the tech space, intervening rights could mean that infringement is lost forever where the market has already matured beyond the patented technology.

Intervening rights aside, there is also a 1-for-1 substitution limitation on Motions to Amend at the PTAB. This means that Patentees — unlike the days of patent reexamination— can’t simply add piles of new claims as a hedge. Rather, they must give up existing claims in order to even offer an amendment; this is not the easy decision it was in patent reexamination.

Finally, even in those limited cases where amendment is a viable option, the vast majority of such motions fail because the amendments are far too minimal. Stated another way, when claims are being prosecuted, amendments are fashioned to distinguish from the art — period. In PTAB proceedings, maintaining an infringement read on the petitioner is the primary driver on what is added to a claim. For this reason, in many Motions to Amend, the change to the claim is very slight to maintain infringement, or try to comply with the “substantially identical” standard of intervening rights. Shooting down these types of amendments typically requires minimal effort from the Petitioner. Indeed, most motions to amend are declined on prior art grounds. Whether that prior art is first explored by the Patentee or Petitioner (i.e., burden shifting) is of no moment.

PTAB Motions to Amend will remain unpopular, and rarely successful given the practical dynamics at work.

The more interesting aspect of Aqua Products was the “Chevron deference” posturing of the Court on the eve of the Supreme Court’s review of SAS Institute v. Lee. This case has been largely overlooked in the shadow of Oil States, but will be far more impactful on PTAB practice. More on this next week