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SNQ Standard Removed by Proposed Manager AmendmentToday, the Chairman of the House Judiciary Committee circulated a Manager’s Amendment to H.R. 1249. (here).  There were several notable changes to the proposed Inter Partes Review and Post Grant Review proceedings.Perhaps the most noteworthy change in the manager’s amendment from a post grant perspective is the removal of the Substantial New Question of Patentability (SNQ) standard for Inter Partes Review. Previously I explained that the SNQ standard was adopted by the House for Inter Partes Review over the proposed “reasonable likelihood of success” standard of Senate bill S.23. The House adoption of the more liberal SNQ standard was not only unpopular, but rendered other aspects of the bill wasteful. Fortunately, this change has been undone by the manager amendment.Other notable Post Grant Changes include:Inter Partes Review-expansion of window to request an Inter Partes Review once litigation is initiated (expanded from 9 months to one year)-a provision was added guaranteeing that the petitioner will get at least one opportunity to file written comments if an Inter Partes Review is instituted. (I guess if the Board sides with the Patentee at the outset, the Patentee would not need to file anything that would trigger a petitioner right of response, effectively forcing the petitioner to the CAFC?)-the section of H.R. 1249 pertaining to staying an ITC action was removed (Sec. 320)Post Grant Review-the section of H.R. 1249 pertaining to staying an ITC action was removed (Sec. 330)Other provisions and changes, perhaps most notably to the first to file provision (correction of language). Also a provision was added to study the impact of patent troll litigation and its effect on the econo

Today, the Chairman of the House Judiciary Committee circulated a Manager’s Amendment to H.R. 1249. (here).  There were several notable changes to the proposed Inter Partes Review and Post Grant Review proceedings.

Perhaps the most noteworthy change in the manager’s amendment from a post grant perspective is the removal of the Substantial New Question of Patentability (SNQ) standard for Inter Partes Review. Previously I explained that the SNQ standard was adopted by the House for Inter Partes Review over the proposed “reasonable likelihood of success” standard of Senate bill S.23. The House adoption of the more liberal SNQ standard was not only unpopular, but rendered other aspects of the bill wasteful. Fortunately, this change has been undone by the manager amendment.

Other notable Post Grant Changes include:…

Continue Reading House Reverts to Senate Inter Partes Review Standard

USPTO Vacates Reexamination Certificate Cancelling All Claims?Typically, a patent reexamination proceeding is terminated after a patentability determination of the USPTO. Termination may occur during the prosecution phase or after the appeal phase is concluded. Occasionally, a patent reexamination is terminated based upon a failure of a Patentee to present timely filings.  Once terminated, a certificate is published informing the public of the outcome of the patent reexamination proceeding (i.e., claim changes/cancellations).For those terminations caused by the failure to present a timely filing, such as an interview summary (ex parte) or a response to an office action, it is possible to petition under 37 CFR § 1.137(b) to have the late papers entered and the termination vacated; thereafter, the patent reexamination proceeding continues. But what if the petition is not filed until months after the initial termination, and after the printing of a certificate informing the public that all claims of the patent have been cancelled?The answer might surprise you.In Extreme Networks, Inc. v. Enterasys Networks, Inc., (WDWI), after an adverse jury verdict, defendant Enterasys sought ex parte patent reexamination of the Extreme Network patents at issue. The verdict found Enterasys liable for $200k in damages, but more importantly, an injunction was entered against the defendant (now stayed).In April of 2010, first office actions were issued in two of the ex parte patent reexaminations (90/010,433 & 90/010,432) . In June of 2010, petitions for extension of time were filed by Extreme to extend the due date for filing the responses; these petitions were denied. In July of 2010, both reexaminations were terminated as a response was never filed to the April office actions. 4 months later, reexamination certificates were printed cancelling all claims of the respective patents.Relying on the printed certificates, Enterasys motioned for the court to dissolve the injunction. Shortly thereafter, Extreme petitioned the USPTO to vacate the terminated reexamination proceedings, despite the fact that the certificates had already printed. Extreme claimed that the months of delay in filing their response was unintentional; curiously, the USPTO granted the petitions.Enterasys then filed a new motion with the court alleging that the petition filing constituted clear inequitable conduct (as the decision not to file a response after the extension denial was intentional), and that the injunction threat was no longer equitable. The court denied the relief requested by Enterasys, but continued the stay until the conclusion of the patent reexaminations (decision here)Petitions to vacate a terminated patent reexamination are not uncommon. Yet, here, the reexaminations were not only terminated, they were concluded, and resulted in printed certificates. Only after the printing of the certificates were the petitions submitted to the office. It is unclear how the USPTO can justify jurisdiction over such concluded proceedings. Indeed, 37 CFR  § 1.570(d) provides:If a certificate has been issued which cancels all of the claims of the patent, no further Office proceedings will be conducted with regard to that patent or any reissue applications or reexamination requests relating thereto. (emphasis added)Here the office decision vacated the reexamination certificate that cancelled all claims, and allowed further proceedings. This action seems directly at odds with 1.570(d).Moreover, even assuming such vacatur were proper on another basis, public policy would seem to favor reliance upon printed reexamination certificates. Certainly practitioners should be allowed to correct simple mistakes, but with so many patent reexaminations being related to high profile litigations (as was the case here) it should not take 6 months to file a simple petition…..just my two cents. Very, very strange case.This case was brought to my attention by the great Docket Navigator.

Typically, a patent reexamination proceeding is terminated after a patentability determination of the USPTO. Termination may occur during the prosecution phase or after the appeal phase is concluded. Occasionally, a patent reexamination is terminated based upon a failure of a Patentee to present timely filings.  Once terminated, a certificate is published informing the public of the outcome of the patent reexamination proceeding (i.e., claim changes/cancellations).

For those terminations caused by the failure to present a timely filing, such as an interview summary (ex parte) or a response to an office action, it is possible to petition under 37 CFR § 1.137(b) to have the late papers entered and the termination vacated; thereafter, the patent reexamination proceeding continues. 

But what if the petition is not filed until months after the initial termination, and after the printing of a certificate informing the public that all claims of the patent have been cancelled?

The answer might surprise you.
Continue Reading The Finality of a Patent Reexamination Certificate

Using a Parallel Patent Reexamination as Evidence of Invalidity?Increasingly, courts are presented with evidence of a parallel patent reexamination and must determine whether/when such evidence is admissible.Admissibility of evidence is governed by the Federal Rules of Evidence (“FRE”).  In recent cases, where the admissibility of evidence of concurrent reexamination proceedings has been offered with respect to the ultimate question of validity, patentees have attempted to use three rules of evidence to exclude such evidence, FRE 402, FRE 403, and FRE 802.FRE 402 excludes irrelevant evidence.  Patentees, hoping to keep evidence of concurrent reexamination proceedings out of the litigation and away from the jury, have argued that this evidence is irrelevant and should be excluded under FRE 402.  Several courts have agreed.  For example, in the Northern District of Iowa, where reexamination had been granted but no office action had issued, the court stated that “evidence of incomplete patent reexamination proceedings is not admissible to prove invalidity of a patent, because it has no probative value on that issue.”  Transamerica Life Ins. Co. v. Lincoln National Life Ins. Co., 597 F. Supp. 2d 897, 907 (N.D. Iowa 2009) (citing Fed. R. Evid. 402).  Likewise, in the District of Utah, the court held that “evidence concerning the reexamination proceedings is likely irrelevant because it does not have the tendency to make any fact more or less probable than it would otherwise be.” Edizone, L.C. v. Cloud Nine, 2008 U.S. Dist. LEXIS 41258, at *4 (D. Utah, May 22, 2008).  Even where reexamination proceedings resulted in the rejection of claims and the issuance of  actions closing prosecution, the Southern District of Texas still found that such evidence was irrelevant.  Tesco Corp. v. Weatherford Int’l, Inc., 2010 U.S. Dist. LEXIS 121054 (S.D. Tex., Sep. 27, 2010).  The Tesco court stated that “[u]nlike in reexaminations, those challenging the validity of a patent in litigation must overcome a presumption of validity by proving by clear and convincing evidence that a patent is valid.  The conclusions of examiners as to whether a claim should be confirmed or rejected using a completely different standard have no probative value in this context.”  Id. at *27.  Nonetheless, the Tesco court held that evidence of concurrent reexamination proceedings was relevant to the issue of willful infringement.  Id. at *29-30.However, even where such evidence has been found to be relevant, some courts have found that it fails the test of FRE 403.  FRE 403 states that “evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence.”  Patentees, hoping to exclude evidence of concurrent reexamination proceedings have argued that the probative value of such evidence would be far outweighed by the danger of its prejudice.  Several courts have agreed.  Where the PTO had granted a request for reexamination, the Eastern District of Texas held that “[t]he simple fact that a reexamination decision has been made by the PTO is not evidence probative of any element regarding any claim of invalidity. . . . Even if it was, its probative value is substantially outweighed by its prejudicial effect in suggesting to the jury that it is entitled to ignore both the presumption of validity and the defendant’s clear and convincing burden at trial.” i4i L.P. v. Microsoft Corp., 670 F. Supp. 2d 568, 588 (E.D. Tex. 2009).  The Northern District of Illinois similarly held that “telling the jury that the patent has been called into question by the Patent Office may significantly influence the jury’s application of the presumption of validity and significantly prejudice [the patentee]. The prejudicial potential of this evidence far outweighs any probative value it may have.” Amphenol T&M Antennas, Inc. v. Centurion Int’l, Inc., 2002 U.S. Dist. LEXIS 822, at *5 (N.D. Ill., Jan. 17, 2002).  Even where final rejections had been made during reexamination, the District of Delaware held that “[a]bsent unusual circumstances… non-final decisions made during reexamination are not binding, moreover, they are more prejudicial (considering the overwhelming possibility of jury confusion) than probative of validity.” SRI Int’l Inc. v. Internet Security Sys., Inc., 647 F. Supp. 2d 323, 356 (D. Del. 2009).FRE 802 ensures the inadmissibility of hearsay evidence.  Hearsay is defined as “a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.”  Fed. R. Evid. 801(c).  In Fresenius Medical Care Holdings, Inc. v. Baxter International, Inc., the patentee argued that the alleged infringer was offering several PTO documents, including the grant of a request for reexamination, to prove the truth of the matters asserted therein.  No. 03-cv-1431 (N.D. Cal. May 15, 2006).  According to the patentee, such documents were hearsay.  In response, the accused infringer asserted that this evidence fell within the public records exception to the hearsay rule, FRE 803(8), and was admissible.  Id.  FRE 803(8) creates an exception for “[r]ecords, reports, statements, or data compilations, in any form, of public offices or agencies, setting forth (A) the activities of the office or agency, or (B) matters observed pursuant to duty imposed by law as to which matters there was a duty to report…, or (C) in civil actions…, factual findings resulting from an investigation made pursuant to authority granted by law, unless the sources of information or other circumstances indicate lack of trustworthiness.”  Fed. R. Evid. 803(8).  In Fresenius, the court found that evidence of a grant of reexamination fell within this exception and was not excludable as hearsay.  Id., slip op. at 4-6.  Specifically, it found that the PTO is a public office or agency, that the determination that a substantial new question of patentability exists is a final decision, and that PTO documents are trustworthy. Id. at 5. For purposes of proving invalidity, evidence of concurrent reexamination proceedings is almost certainly to be excluded as lacking relevance under FRE 402 and/or as being more prejudicial than probative under FRE 403.For the above reasons, parallel patent reexamination filings are almost never filed for the purpose of convincing a fact finder that a patent should be found invalid at trial.Instead, the benefits of parallel patent reexamination have been discussed at great length here as potentially impacting other aspects of litigation, “Is Evidence of Parallel Reexamination Proceedings Admissible at Trial?” (Parts I, II, III, and IV). In past posts, we have explained the benefits of parallel patent reexamination evidence as: aiding an inequitable conduct defense, impacting claim construction,  rebutting allegations of willful infringement, obtaining patent owner admissions to support a non-infringement defense, obtaining an intervening rights defense, providing grounds to stay a district court proceeding, and supporting/opposing injunctive reli

Increasingly, courts are presented with evidence of a parallel patent reexamination and must determine whether/when such evidence is admissible.

Admissibility of evidence is governed by the Federal Rules of Evidence (“FRE”).  In recent cases, where the admissibility of evidence of concurrent reexamination proceedings has been offered with respect to the ultimate question of validity, patentees have attempted to use three rules of evidence to exclude such evidence, FRE 402, FRE 403, and FRE 802.

FRE 402 excludes irrelevant evidence.  Patentees, hoping to keep evidence of concurrent reexamination proceedings out of the litigation and away from the jury, have argued that this evidence is irrelevant and should be excluded under FRE 402.  Several courts have agreed.  …
Continue Reading Patent Reexamination Evidence Can Be Prejudicial to Patentees

Confirmed Dependent Claims Confuse Court?It seems every day there is a new decision issued in a district court addressing a motion to stay pending patent reexamination. (certainly I have written my fair share of posts on the topic). Due to the routine nature of these decisions, I try to avoid discussing the topic too much absent some noteworthy development.Recently, in Simson Garfinkel v Decru Inc., (EDTX) (here) the plaintiff sought to lift a stay that has been in place since the Summer of 2008. Initially, the case was stayed pending an ex parte patent reexamination (U.S. Patent 6,993,661). The plaintiff requested that the case be stayed until the conclusion of that proceeding. During this reexamination, all the issued claims were cancelled in favor of new claims, which were allowed. Shortly thereafter, the defendants sought inter partes reexamination of the new claims. In a first action, dependent claims 946-53) were confirmed, but the independent claims (42-45) were rejected. After learning of the confirmation of the dependent claims, the plaintiff sought to lift the stay. In denying the plaintiff’s request, the court cited the defendant’s argument that the confirmed claims are “virtually certain” to be amended. However, this argument is based on a flawed understanding of patent reexamination practice. At page 4 of the decision, the court explained:Defendants sur-reply that contrary to Plaintiff’s assertions, all of the claims in the Plaintiff’s patent are “virtually certain” to undergo further changes, even the ones that Plaintiff has identified as affirmed. Dkt. No. 101 at 2. Defendants point out that the four independent claims, claims 42 to 45, have been rejected and that claims 46 through 53 depend from those independent claims. Thus, claims 46 through 53 has to “either be amended to independent form, or be made to depend on a new independent base claim” for those claims to be allowable. (emphasis added)This is absolutely not the case. Unlike regular prosecution, it is improper to object to an allowable dependent claim by virtue of a dependency to a rejected base claim. There is never a need to amend such claims. As explained in MPEP § 2260.01.If an unamended base patent claim (i.e., a claim appearing in the reexamination as it appears in the patent) has been rejected or canceled, any claim which is directly or indirectly dependent thereon should be confirmed or allowed if the dependent claim is otherwise allowable. The dependent claim should not be objected to or rejected merely because it depends on a rejected or canceled patent claim. No requirement should be made for rewriting the dependent claim in independent form. As the original patent claim numbers are not changed in a reexamination proceeding, the content of the canceled base claim would remain in the printed patent and would be available to be read as a part of the confirmed or allowed dependent claim. (emphasis added)Rather than pointing this issue out to the court during oral argument to aid in justify the lifting of the stay, unfortunately, shortly after the briefing concluded….the Patentee placed all of the dependent claims in independent form in a December 2010 amendment.( This was done despite the fact that the office, correctly, made no such requirement).Here the stay may very well have remained in place based on other factors beyond the scope of reexamination issue. However, the ability to point out that the claims will not change and that the defendants argument is wrong may have persuaded the judge to lift the stay. Instead, the Patentee now has to wait until September before seeking another reconsideration of the issue.  As pointed out previously, this amendment mistake is quite common, and can often times have significant impact on unexamined, intervening claims.This case was brought to my attention by the great Docket Navigator.

It seems every day there is a new decision issued in a district court addressing a motion to stay pending patent reexamination. (certainly I have written my fair share of posts on the topic). Due to the routine nature of these decisions, I try to avoid discussing the topic too much absent some noteworthy development.

Recently, in Simson Garfinkel v Decru Inc., (EDTX) (here) the plaintiff sought to lift a stay that has been in place since the Summer of 2008. Initially, the case was stayed pending an ex parte patent reexamination (U.S. Patent 6,993,661). The plaintiff requested that the case be stayed until the conclusion of that proceeding. During this reexamination, all the issued claims were cancelled in favor of new claims, which were allowed. Shortly thereafter, the defendants sought inter partes reexamination of the new claims. In a first action, dependent claims 946-53) were confirmed, but the independent claims (42-45) were rejected. After learning of the confirmation of the dependent claims, the plaintiff sought to lift the stay. 

In denying the plaintiff’s request, the court cited the defendant’s argument that the confirmed claims are “virtually certain” to be amended. However, this argument is based on a flawed understanding of patent reexamination practice.…

Continue Reading Stay Continued Despite Confirmed Claims

Director Kappos Informs Examing Corps of Temporary Funding Today, Director Kappos provided the following announcement to the Examing Corps:            Although the Commerce Department indicated earlier in the week that the USPTO should prepare a plan to shut down, it appears that temporary funding exists to keep the office going for a few days. Full announcement

…

buzzGoings on and Rumored Changes at the USPTO Spring 2011

With so much attention focused on the current patent reform debate, continued efforts within the USPTO to improve post grant performance may be going unnoticed. Below are just a few office initiatives and rumored developments. 

USPTO to Close Monday?

Assuming Congress does not arrive at a solution to the current budget impasse, the USPTO has been informed by the Secretary of Commerce that it is not exempt from a government shutdown.

Central Reexamination Unit (CRU)

Recently, the Office has begun reviewing examiner applications to join the Central Reexamination Unit (CRU) for a temporary detail (3 months, extendable for a year) (opening listed here). Selected examiners will be assigned to work
Continue Reading The Post Grant Buzz (Spring 2011)

Delay in Case Schedule Allows for Amended Complaint  Previously, Voda v. Medtronic Inc., et. al. (OKWD) examined the impact of multiple requests for patent reexaminationin the context of a motion to stay. Early in the case the defendant Medtronic was able to secure a stay pending a first request for patent reexamination. Shortly thereafter, the

…

Inter Partes Review, 5 Months to a First Action?Should the proposed patent reform legislation pass into law, inter partes reexamination will gradually cease to exist. In place of inter partes patent reexamination will be an entirely new mechanism known as Inter Partes Review. Inter Partes Review will not be conducted by patent examiners of the Central Reexamination Unit, but instead by the Administrative Patent Judges of the Patent Trial & Appeal Board (now known as the BPAI). As the new proceeding is conducted by APJs, limited discovery practices will be provided. Beside these procedural changes, the substantive analysis remains largely the same. …at least in H.R. 1249.In H.R. 1249, the Substantial New Question of Patentability (SNQ) standard is substituted for the “likelihood of success” standard of Senate bill S.23. So, in order to initiate an Inter Partes Review under the House Bill, the same SNQ standard of inter partes patent reexamination is used.While the House bill removed the heightened standard (i.e., likelihood of success) in favor of the much more liberal SNQ standard (i.e., important to a reasonable examiner), the Senate provision providing for a preliminary Patentee response to a request for Inter Partes Review remains in the bill. In essence, Inter Partes Review of H.R. 1249 is substantive ly the same as inter partes patent reexamination, with the added provision of a patent owner statement on the front end. In the Senate Bill, a preliminary response provided a meaningful opportunity for patentees to rebut the ‘likelihood of success” showing of the request. Now that the House Bill has reverted to the SNQ standard, the preliminary response may provide nothing more than dead time to the front end of the Inter Partes Review. The preliminary response provision of H.R. 1249 reads as follows:Sec. 313. Preliminary response to petition(a) Preliminary Response- If an inter partes review petition is filed under section 311, the patent owner shall have the right to file a preliminary response within a time period set by the Director.(b) Content of Response- A preliminary response to a petition for inter partes review shall set forth reasons why no inter partes review should be instituted based upon the failure of the petition to meet any requirement of this chapter.Sec. 314. Institution of inter partes review(a) Threshold- The Director may not authorize an inter partes review to commence unless the Director determines that the information presented in the petition filed under section 311 and any response filed under section 313 shows that a substantial new question of patentability exists. (emphasis added)History has shown that roughly 96% of inter partes patent reexaminations are granted, meaning an SNQ is almost always found. Due to the relatively low standard for finding an SNQ, it seems unlikely that a patentee would deem it worthwhile to argue the issue. Whether an SNQ is presented in the request is quite different from whether or not prima facie rejections are presented. As such, one would expect the office to follow the statute and deny consideration of arguments directed to proposed rejections as premature.Although neither the House nor Senate bills identify a time frame to submit such a preliminary response, the Post Grant Review mechanism provides 2 months. Thus, it is safe to assume a similar time frame for Inter Partes Review. The date for determining whether or not the proceeding should be conducted is “within three months” of the receipt of the preliminary response, or the last date upon which one would be due. So, a first office action would not be possible until at least 5 months from filing of an Inter Partes review.Currently, as there is no patent owner statement permitted in inter partes patent reexamination, office actions have issued as quickly as 2 months. Notably, Congress has set a 12 month time frame to conclude an Inter Partes Review (18 months maximum); front loading needless delay would not seem to comport with that intent.  As the saying goes, if it aint broke, don’t fix

Should the proposed patent reform legislation pass into law, inter partes reexamination will gradually cease to exist. In place of inter partes patent reexamination will be an entirely new mechanism known as Inter Partes Review.

Inter Partes Review will not be conducted by patent examiners of the Central Reexamination Unit, but instead by the Administrative Patent Judges of the Patent Trial & Appeal Board (now known as the BPAI). As the new proceeding is conducted by APJs, limited discovery practices will be provided. Beside these procedural changes, the substantive analysis remains largely the same. …at least in H.R. 1249.

In H.R. 1249, the Substantial New Question of Patentability (SNQ) standard is substituted for the “likelihood of success” standard of Senate bill S.23. So, in order to initiate an Inter Partes Review under the House Bill, the same SNQ standard of inter partes patent reexamination is used.

While the House bill removed the heightened standard (i.e., likelihood of success) in favor of the much more liberal SNQ standard (i.e., important to a reasonable examiner), the Senate provision providing for a preliminary Patentee response to a request for Inter Partes Review remains in the bill. In essence, Inter Partes Review of H.R. 1249 is substantive ly the same as inter partes patent reexamination, with the added provision of a patent owner statement on the front end. 

In the Senate Bill, a preliminary response provided a meaningful opportunity for patentees to rebut the ‘likelihood of success” showing of the request. Now that the House Bill has reverted to the SNQ standard, the preliminary response may provide nothing more than dead time to the front end of the Inter Partes Review. …
Continue Reading House Version of Inter Partes Review & Wasted Time

Additional Grounds for Challenging Patents in Proposed Post Grant Review LegislationOn Wednesday, the House of Representatives formally introduced H.R. 1249, as previewed here last Friday. The bill includes some changes to the proposed post grant review and inter partes review proceedings.The two major changes being discussed in the House are: (1) The expansion of the Post Grant Review window to 12 months (S.23 previously provided 9 months); and (2) The reemergence of the SNQ standard as the threshold determination in the proposed inter partes review proceeding (S.23 previously proposed a likelihood of success standard). The Bio/Pharma community has been clear that the House’s adoption of the SNQ standard for inter partes review is not a welcomed change.Yet, the “additional grounds” subsection of postgrant review may prove much more troublesome for the bio/pharma community.Both the Senate and House bills prevent a post grant review proceeding form going forward unless the request demonstrates that “it is more likely than not that at least 1 of the claims challenged in the petition is unpatentable.” (Sec. 324 subsection (a))Subsection (b) provides:(b) ADDITIONAL GROUNDS–The determination required under subsection (a) may also be satisfied by a showing that the petition raises a novel or unsettled legal question that is important to other patents or patent applications.Subsection (b) clearly addresses the concern that subsection (a) would, by virtue of the “more likely than not” outcome standard, prevent challenges on unproven theories. But, is subsection (b) necessary?  Is the USPTO the best venue for such novel legal challenges?  What kinds of “theories” would fall into this category anyway?It is hard to imagine too many novel or untested legal theories that are “important to other patents or patent applications” that would not in some way involve application of 35 U.S.C. § 101. Arguing against the patentability of gene sequencing, aspects of human cloning, genome mapping, and the like would seem to be the types of “novel or untested” legal theories having a wide ranging impact on other patents. Subsection (b) is nothing more than an invitation to take these battles to the USPTO.It seems to me that untested legal theories that have far reaching public policy implications are best left to the courts and legislators. The USPTO is best equipped to review issues of technology and prior art, not novel legal questions.Moreover, this legislation is a game changer with respect to the Board of Patent Appeals & Interferences (BPAI). The USPTO will have enough on their plate transitioning to a Patent Trial & Appeal Board to accommodate inter partes review, while simultaneously accommodating an entirely new procedure, post grant review. Encouraging the public to pursue novel and untested legal theories during this time of change seems more than a bit misguided. Clearly, the post grant aspects of the bill will be hotly debated in the coming weeks. Yet, not all aspects of the proposed post grant review mechanism are problematic for bio/pharma.  Interestingly, since the grounds of post grant review are based on the statutory defenses of 35 U.S.C. § 282, instead of patent reexamination’s “patents and printed publications,” obviousness-type double patenting is seemingly excluded from post grant review. The absence of this ground is a boon to the bio/pharma community. Many patent reexaminations that involve drug patents include such rejections with the hopes of limiting patent term.More on the various post grant options of the legislation next week.  

On Wednesday, the House of Representatives formally introduced H.R. 1249, as previewed here last Friday. The bill includes some changes to the proposed post grant review and inter partes review proceedings.

The two major changes being discussed in the House are: (1) The expansion of the Post Grant Review window to 12 months (S.23 previously provided 9 months); and (2) The reemergence of the SNQ standard as the threshold determination in the proposed inter partes review proceeding (S.23 previously proposed a likelihood of success standard). The rn-with-inter-partes-review-changes/”>Bio/Pharma community has been clear that the House’s adoption of the SNQ standard for inter partes review is not a welcomed change.

Yet, the “additional grounds” subsection of postgrant review may prove much more troublesome for the bio/pharma community.…

Continue Reading Post Grant Review Grounds

Petition or Appeal?–Pursuit of SNQ Denial at the USPTOWhen pursuing inter partes patent reexamination, denial of a Substantial New Question of Patentability (SNQ) by the USPTO can be especially troubling to third party requesters. This is because a third party is estopped from asserting in litigation the “invalidity of any claim finally determined to be valid and patentable on any ground which the third-party requester raised or could have raised during the inter partes reexamination proceedings.” 35 U.S.C. § 315(c).Denied SNQs raise the fear of potential district court estoppel relative to the prior art underlying the denied SNQ. For this reason, third parties will almost always dispute such denials internal to the USPTO–even where the claims of the patent remain rejected based upon other SNQs of the same request.But, what is the appropriate vehicle for such a dispute, petition or appeal? The answer to this question will depend upon whether or not the denied SNQ pertains to a claim that is being actively reexamined on other grounds. As explained by an expanded panel of the Board of Patent Appeals & Interferences (BPAI) yesterday in Belkin International et al., v. Optimumpath LLC, the denial of an SNQ in inter partes patent reexamination is  petitionable, not appealable. In Belkin U.S. Patent 7,035,281 was reexamined (95/001,089). The request was granted as to claims 1-3 and 8-10, but denied as to claims 4-7 and 11-31.The denial of the SNQs applied to claims 4-7 and 11-31 was petitioned to the Director of the Central Reexamination Unit. Upon reconsideration, the Director refused to reverse the examiner. During prosecution, the rejection of claims 1-3 and 8-10 was later withdrawn by the examiner. Thereafter, the third party appealed the withdrawn rejection and the denial of the SNQs. On appeal, the BPAI affirmed the examiner’s decision to withdraw the rejection and confirm the patentability of claims 1-3 and 8-10. As to the appeal of the denied SNQs, the BPAI explained that such issues may not be appealed to the Board. . . . 35 U.S.C. § 312 states that the Director makes such determinations (of whether a substantial new question of patentability exists) and that the determination “by the Director . . . shall be final and non-appealable.” Only when the Director makes the determination that a substantial new question of patentabilityaffecting a claim of a patent is raised (i.e., that a substantial new question of patentability exists for a particular claim) shall an inter partes reexamination of the claim(s) in question be performed for resolution of the question (35 U.S.C. § 313). Therefore, on the other hand, when the Director makes a determination that a substantial new question of patentability affecting a particular claim is not raised, the Director does not order inter partes reexamination of the patent with respect to those claims. Under those circumstances, no reexamination is performed with respect to those proposed substantial new questions of patentability. Also, as pointed out above, the Director’s determination that no substantial new question of patentability was established for any particular claim(s) is final and non-appealable (35 U.S.C. § 312(c)).Since, under 35 U.S.C. § 312 and 35 U.S.C. § 313, reexamination of the patent claims in question cannot proceed when the Director makes a determination that a substantial new question of patentability has not been raised for those claims and that the Director’s determination is non-appealable, no final decision, whether favorable or unfavorable, can be rendered pertaining to those claims. Under 35 U.S.C. § 315(b), a third-party requester may appeal with respect to any “final decision favorable to the patentability” of disputed claims. However, as described above, if the Director makes the non-appealable determination that no substantial new question of patentability has been raised, then reexamination is not performed for those claims in question with respect to the corresponding prior art references. There cannot have been a final decision (either favorable or unfavorable) on the patentability of the claims in question under 35 U.S.C. § 315(b), the claims not having been reexamined in the first place for lack of a substantial new question of patentability. (emphasis added)The decision continues on to explain that the denial of SNQs is propoerly pursued by petition to the Director (which Belkin filed to no avail; 37 C.F.R. § 1.927). Note that had an SNQ been found but the corresponding rejections not adopted, appeal of non-adopted rejections would have been appropriate.Of course, a patent owner’s seeking to reverse an accepted SNQ in ex parte patent reexamination may pursue the matter to the BPAI

When pursuing inter partes patent reexamination, denial of a Substantial New Question of Patentability (SNQ) by the USPTO can be especially troubling to third party requesters. This is because a third party is estopped from asserting in litigation the “invalidity of any claim finally determined to be valid and patentable on any ground which the third-party requester raised or could have raised during the inter partes reexamination proceedings.” 35 U.S.C. § 315(c).

Denied SNQs raise the fear of potential district court estoppel relative to the prior art underlying the denied SNQ. For this reason, third parties will almost always dispute such denials internal to the USPTO–even where the claims of the patent remain rejected based upon other SNQs of the same request.

But, what is the appropriate vehicle for such a dispute, petition or appeal? The answer to this question will depend upon whether or not the denied SNQ pertains to a claim that is being actively reexamined on other grounds.

Continue Reading Pursuing Denied SNQs in Inter Partes Patent Reexamination