Scott McKeown

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Upcoming CLE Programs My partner, Stephen Kunin is the former Deputy Commissioner for Patent Examination Policy at the USPTO. He will be speaking at a few CLE events of potential interest to the post-grant community in the coming weeks. On March 21-22, PLI’s 5th Annual Patent Law Institute will make its way to San Francisco.

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Patent Reform, The Next “Big Thing”Since being voted out of committee earlier this month, the Patent Reform Act of 2011 (S.23) has been awaiting floor debate. S.23 was first positioned behind the FAA bill in the legislative queue, and now seems secondary to the budget crisis. Although scheduled for debate on February 28th, it seems

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Deja Vu All Over Again in Patent Reexamination?A prejudice common to Patent Owners is that patent reexamination serves to re-hash previously distinguished prior art for harassment purposes. While this is certainly not the case, the difference between a previously considered issue and a “Substantial New Question of Patentability” (SNQ) need not be very pronounced.Since In re Swanson, the standard for establishing a (SNQ) in a patent reexamination has been quite liberal. A requester need only establish that the submitted art be presented in a new light. Thus, previously considered prior art can be re-considered, if applied to the claims in a slightly different manner than that of the original prosecution.However, that is not to say that every proposed SNQ is…well, an SNQ.In such instances, when is the best time to object, and what is the proper procedural mechanism, petition or appeal? A recent decision of the BPAI has helped clarify these issues for ex parte patent reexamination.Last June, I explained the case of Ex parte Yasukochi et al, which pertained to an owner initiated ex parte patent reexamination. At issue in Yasukochi is U.S. Patent 7,034,083 (“‘083 Patent”) of Hisamitsu Pharmaceutical.  After the ex parte patent reexamination was initiated by Hisamitsu on certain prior art, the examiner introduced a rejection based upon a reference (Tsubota) previously applied in the original prosecution. The Patentee argued that this reference was being applied in the exact same manner as the original prosecution, and, as such, could not constitute an SNQ. On appeal, the BPAI refused to consider the issue, taking the position that the propriety of an SNQ is a question of procedure to be addressed by petition. Under the BPAI’s reasoning, the patent owner should have filed a petition under 37 CFR § 1.181 to the Director of the CRU when the examiner initially raised the new rejection.  Of course, such a petition was untimely at the time of the appeal. (since more than two months have elapsed since the rejection was made).The decision seemed to be at odds with In re Recreative Technologies Corp., 83 F.3d 1394, 38 USPQ2d 1776 (Fed. Cir. 1996) as well as  In re Portola Packaging Inc., 110 F.3d 786, 42 USPQ2d 1295 (Fed. Cir. 1997), which both considered the question of an appropriate SNQ in patent reexamination at the Board level (and beyond).A week thereafter, the USPTO determined that issues relating to an SNQ determination, while still considered a procedural question, are to be delegated the BPAI for a final determination. In the June 25, 2010 Federal Register Notice, the Office has clarified that assuming an SNQ is contested prior to appeal, either by petition or Patentee response, that the BPAI will now finally decide the issue. Likewise, for reexaminations pending prior to 6/25/10, if the issue was not raised prior to appeal, the Patentee may still raise the issue with the BPAI.So, in essence, Hisamitsu was afforded a chance to pursue the issue before the BPAI on rehearing.On further consideration, the BPAI found that the change in procedure was not applicable to rejections applied during patent reexamination. The Board reasoned that the proper avenue for such a review was still by way of petition, stating:We hold that the Notice does not delegate authority to the Board to decide whether a particular rejection made during the course of prosecution following a properly initiated reexamination is outside the scope permitted in an ex parte reexamination. The notice addresses those situations where a patent owner challenges an examiner’s threshold determinationthat a substantial new question has been presented. The Notice delegates the authority “to review issues related to the examiner’s determination that a reference raises a SNQ” to the Chief APJ. Notice, 75 Fed. Reg. 36,357. The examiner’s determination is not challenged in this appeal. Appellant requested that its patent be reexamined. Request for Ex parte Reexamination, filed March 22, 2007, pp. 1-6. The examiner held that a substantial new question had been raised by that request. Order Granting Request for Ex Parte Reexamination dated April 11, 2007, pp. 3-5. The examiner’s determination that the cited references raise a SNQ is unchallenged. (emphasis added)The Board seemed to emphasize throughout the rehearing opinion (here) that the Patentee had presented the initial SNQs necessary to initiate the reexamination. As to the Tsubota rejection, the examiner made clear in the rejection that the reference was previously considered. The examiner explained that previously submitted declaration evidence was ineffective against the reference as failing to account for certain claim language, hence the SNQ. Thus, even had Hisamitsu petitioned, the PTO seemed to have a legitimate ground for the re-presentation of the Tsubota reference. Interestingly, it appears the examiner searched for prior art during patent reexamination. Several references used in rejecting the claims were neither submitted by the patentee or of record in the earlier application prosecution; this is quite unusual.All is not lost for Hisamitsu, during the patent reexamination a broadening patent reissue was filed that remains suspended. Absent appeal to the CAFC, the reissue proceeding can now proceed. Perhaps Hisiamitsu will have more luck in this post grant proceeding. (12/108,934) 

A prejudice common to Patent Owners is that patent reexamination serves to re-hash previously distinguished prior art for harassment purposes. While this is certainly not the case, the difference between a previously considered issue and a “Substantial New Question of Patentability” (SNQ) need not be very pronounced.

Since In re Swanson, the standard for establishing a (SNQ) in a patent reexamination has been quite liberal. A requester need only establish that the submitted art be presented in a new light. Thus, previously considered prior art can be re-considered, if applied to the claims in a slightly different manner than that of the original prosecution.

However, that is not to say that every proposed SNQ is…well, an SNQ.

In such instances, when is the best time to object, and what is the proper procedural mechanism, petition or appeal? A recent decision of the BPAI has helped clarify these issues for ex parte patent reexamination.…

Continue Reading SNQ Deja Vu

terms-of-disservice

Infamous Katz Portfolio Withers Under Pressure of Patent Reexamination

USPTO empirical data is quite helpful for determining the frequency by which claims are amended, cancelled, or confirmed in patent reexamination. Yet, when it comes to the overall efficacy of patent reexamination, USPTO statistics only tell part of the story.

A successful reexamination from an infringer’s perspective does not always result in an overt claim change or cancellation. In other words, even where claims are confirmed, statements in the reexamination record that are inconsistent with arguments made in a concurrent litigation, or that rise to the level of an outright disclaimer may provide new, non-infringement positions to defendants. Likewise, such statements may limit the Patentee’s ability to distinguish the prior art.

In the ongoing patent reexaminations of the Katz portfolio, there have been significant victories for challengers. However, as made clear by the CAFC last week (In re Katz Interactive Call Processing Patent Litigation) not every victory shows up in USPTO statistics as cancelled/amended claims.
Continue Reading Patent Reexamination Statements Hamper Katz Portfolio

When Can the Board Change the Target?In November of 2010, the USPTO introduced a proposed rule package for practice before the BPAI. One focus of the new rules is to liberalize the manner by which an Applicant/Patent Holder may challenge a “new ground of rejection” as presented in an Examiner Answer. The idea being, it is unfair for the Office to change course, mid-way through an appellate process.Unchecked, a modification to the Office’s fact finding/legal theory in an Examiner Answer can be quite prejudicial during patent reexamination. This is because, once on appeal, there is no RCE-like procedural mechanism by which a patent holder can unilaterally restart prosecution. Last week, In re Stepan posed this very issue to the CAFC, albeit in the context of a Board affirmance in patent reexamination. (oral arg. here).At issue in Stepan was the right to priority to a parent application under 35 USC  § 120. Further, a declaration submitted under 37 CFR § 1.131 was submitted to antedate certain 102(a) prior art.  Since the child patent disputed in Stepan was a CIP of the parent, the ability to benefit from the filing date of the parent was considered on a claim-by-claim basis. As such, the examiner determined that certain claims of the Stepan patent were not able to benefit from the 120 priority claim. For these claims, a reference to Singh was determined by the examiner to qualify as 102(b) prior art. Based on this statutory bar, no antedating was possible.The Patentee argued that the 120 priority claim was proper (i.e., 112 support in the parent for the claims), and that priority claim transformed the Singh reference to 102(a) art; thus the Patentee reasoned that the antedating declaration was able to remove Singh as prior art. On appeal, the Board found that the Examiner was incorrect as to 120, and that some of the disputed claims were entitled to priority. However, the Board found that the declaration was insufficient for these claims. In essence, the Board affirmed the examiner by changing the basis of the rejection from 102(b) to 102(a). Rather than seek a rehearing of this issue, Stepan took the dispute to the CAFC.The CAFC and the USPTO pointed out to Stepan that although this change of statutory basis would typically constitute a new ground of rejection, Stepan argued both 102(a) and 102(b) issues in their briefing to the BPAI, and before the examiner. The Patentee countered that had the ground been changed earlier, or designated as such in the affirmance, that the declaration evidence could have been corrected.While a rehearing request to the BPAI is not required before seeking appeal to the CAFC, the panel was not impressed with the failure to point out this issue to the Board prior to the CAFC appeal.Perhaps Stepan would have been better off exploring the controversial district court option to introduce new eviden

In November of 2010, the USPTO introduced a proposed rule package for practice before the BPAI. One focus of the new rules is to liberalize the manner by which an Applicant/Patent Holder may challenge a “new ground of rejection” as presented in an Examiner Answer. The idea being, it is unfair for the Office to change course, mid-way through an appellate process.

Unchecked, a modification to the Office’s fact finding/legal theory in an Examiner Answer can be quite prejudicial during patent reexamination. This is because, once on appeal, there is no RCE-like procedural mechanism by which a patent holder can unilaterally restart prosecution. Last week, In re Stepan posed this very issue to the CAFC, albeit in the context of a Board affirmance in patent reexamination. (oral arg. here).
Continue Reading When is a BPAI Rejection Truly New?

mistakesLast Friday, In re Mostafazadeh was argued before the CAFC (argument here). The case explored the boundaries of the patent reissue recapture rule. At dispute in the appeal was whether or not the third step of the rule, as outlined in MPEP 1412.02, is tied to the “critical limitation” (i.e., originally surrendered subject matter) or not. {10:30 min. mark}

The three step analysis of In re Clement is as follows:

(1) first, we determine whether, and in what respect, the reissue claims are broader in scope than the original patent claims; 

(2) next, we determine whether the broader aspects of the reissue claims relate to subject matter surrendered in the original prosecution; and

(3) finally, we determine whether the reissue claims were materially narrowed in other respects, so that the claims may not have been enlarged, and hence avoid the recapture rule. (emphasis added)

In considering the case, the CAFC found both the MPEP discussion of step (3) and BPAI decision on this point to be confusing. {14.50 min mark}
Continue Reading Recapture Doctrine Before The CAFC

Is a Preliminary Injunction Ever Proper Parallel to Patent Reexamination?Over the past week I have discussed the interplay between a parallel patent reexamination and requests for a preliminary injunction. On Monday I pointed out that if a request for injunctive relief remains outstanding courts are very reluctant to stay an ongoing litigation pending a parallel patent reexamination. Last week I explained that a defendant’s ability to argue prejudice, to fend off a stay pending patent reexamination, may very well hinge on the pursuit of a preliminary injunction. Left to explore this week is the impact of the parallel reexamination on the preliminary injunction equities ultimately weighed by the court.To date, a parallel patent reexamination has been the “silver bullet” for defeating requests for such preliminary injunctive relief. Yet, as one defendant found out recently, perceived gamesmanship in patent reexamination tactics may re-direct that very same bullet to one’s foot.In the case of Celsis In Vitro Inc., v. CellzDirect Inc., & Invitrogen Corp. (N.D. IL), the court agreed to enter an injunction. In doing so, the court rejected certain invalidity evidence presented by the defendant for purposes of demonstrating that the plaintiff was unlikely to succeed on the merits. Upon losing their argument, the defendant filed a request for inter partes patent reexamination. The request included much more art than was presented to the court.Around the same time, the plaintiff beat the defendant to the punch by using the same art in their own ex parte request. The ex parte patent reexamination request was granted. In view of the same or cumulative art before the USPTO in the ex parte request, the defendant’s inter partes request was denied shortly thereafter. By employing  this “first to file” strategy, the plaintiff effectively shut out the defendant from participating in the patent reexamination. (See first to file strategy discussion here)Nevertheless, once a first office action was issued in the ex parte patent reexamination, the defendant sought dissolution/modification of the injunction. The defendant argued that a preliminary injunction has never been maintained in view of a parallel patent reexamination that rejected claims. Yet, this otherwise compelling argument was offset by the perceived bad faith in the defendant’s actions. The court questioned the defendant on the issue as follows:THE COURT:Good morning. I would be remiss, I think, if I didn’t comment that I find defendant’s actions here very troubling. You know, if your — I know you are a newcomer here for this purpose. But if your people wanted to have reexamination of plaintiffs’ ‘929 patent, why wasn’t that done before our hearing and the entry of the preliminary injunction order? That I believe casts a serious cloud on the good faith of the defendants and defense counsel.What is conspicuously absent from this motion to stay is even a whisper of an explanation for doing battle before me, occupying a great deal of time and effort on my part, as well as the part of the litigants, and then when you have lost, tendering the issue of patent validity to the Patent & Trademark Office.And it is not just a matter of lack of consideration for an imposition on what is really — although lawyers don’t think about this a lot — the most limited resource in the justice system, that is, the judge’s time. So before you started to lecture me about something I was well aware, that is, the power to stay and the need for the exercise of discretion, it seems to me I am entitled to an explanation. (Plaintiff’s motion in Opposition to Dissolve or Modify Preliminary Injunction, January 4, 2011)Thereafter, the court did agree to modify the injunction as to certain products already in existence for purposes of inventory liquidation. (order here) However, the court refused to modify the injunction for prospective sales and the manufacture of new product. In other words, based upon the court’s inference of bad faith, the very first defendant was preliminarily enjoined in view of a parallel patent reexamination that rejected asserted claims. (Discussion on permanent injunction equities and parallel patent reexamination here)It may be that the new art in the defendant’s request was more of a response to the “use it or lose it” estoppel provision of inter partes patent reexamination (as opposed to a lack of bad faith). Still, delaying the filing of a patent reexamination parallel to patent litigation rarely makes sense.This case was brought to my attention by the great Docket Navigator.

Over the past week I have discussed the interplay between a parallel patent reexamination and requests for a preliminary injunction. On Monday I pointed out that if a request for injunctive relief remains outstanding courts are very reluctant to stay an ongoing litigation pending a parallel patent reexamination. Last week I explained that a defendant’s ability to argue prejudice, to fend off a stay pending patent reexamination, may very well hinge on the pursuit of a preliminary injunction. Left to explore this week is the impact of the parallel reexamination on the preliminary injunction equities ultimately weighed by the court.

To date, a parallel patent reexamination has been the “silver bullet” for defeating requests for such preliminary injunctive relief. Yet, as one defendant found out recently, perceived gamesmanship in patent reexamination tactics may re-direct that very same bullet to one’s foot.
Continue Reading Undermining a Preliminary Injunction Via Patent Reexamination

House and Senate Focus on Moving ForwardThe Senate may begin debate on Patent Reform this week once the FAA Re-authorization Bill is settled. After last week’s hearing in the House, it appears that a second bill will also emerge.During a recent C-SPAN taping, Rep. Bob Goodlatte (R-Va) has indicated that he will be taking the lead for House Republicans on the creation of new patent reform legislation. It seems that the motivation behind the bill is to accelerate the process. Rep. Goodlatte was reported as stating:…..lawmakers are working in a bipartisan, bicameral way to decide which patent reforms can enhance job growth and stand a good chance of passing Congress and being signed into law by the president. Goodlatte said the most likely focus would be on improving the efficiency of the U.S. Patent and Trademark Office by increasing the speed and quality of the patent process. He acknowledged the Obama administration’s recent plan for reforming the process but said legislation would likely be necessary. When asked about his primary concern for any legislation Goodlatte said the patent process is better at handling drugs and other products that use single patents, but less equipped to deal with technology products that often incorporate dozens or even hundreds of patents. (Source: Hillicon Valley 2/13/11)It remains to be seen whether or not a competing bill in the House will truly help refine the issues, or just create more of the same familiar morass of the past few yea

The Senate may begin debate on Patent Reform this week once the FAA Re-authorization Bill is settled. After last week’s hearing in the House, it appears that a second bill will also emerge.

During a recent C-SPAN taping, Rep. Bob Goodlatte (R-Va) has indicated that he will be taking the lead for House Republicans on the creation of new patent reform legislation. It seems that the motivation behind the bill is to accelerate the process. Rep. Goodlatte was reported as stating:…
Continue Reading This Week in Patent Reform

Pending Prelminary Injunction Dispute Avoids StayAs discussed last week, defendants are increasingly employing patent reexamination as a mechanism to stay a district court action. For this reason, patent owners must adapt their game plan. Last week’s post explained that an early motion for preliminary injunction can go a long way in demonstrating potential prejudice relative to a direct competitor. Additionally, while pending, an injunctive dispute may forestall the ability to stay the court action altogether.In Medicis Pharmaceutical Corp., v. Acella Pharmaceuticals Inc. (DCAZ), the court explained that a motion to stay pending patent reexamination is inappropriate where a request for injuctive relief remains pending.The court explained:Medicis filed a Motion for Preliminary Injunction on December 10, 2010. (Doc. 53.) The parties have submitted their Proposed Findings of Fact and Conclusions of Law (Docs. 122 & 123), and the Court set a hearing on the Motion for Preliminary Injunction for February 23, 2011. If the Court stayed the case pending reexamination, the Court effectively would deny the Motion for Preliminary Injunction without first addressing the merits, which would be inappropriate. Procter & Gamble Co. v. Kraft Foods Global, Inc., 549 F.3d 842, 849 (Fed. Cir. 2008)(holding the district court erred in granting a stay pending reexamination when the plaintiff had filed a motion for preliminary injunction). Because the Court has not yet ruled on the merits of the injunction motion, the Court declines to enter a stay at this time.Further, the court noted that the defendant chose to seek ex parte patent reexamination rather than inter partes. See the earlier post on the importance of this decision. (here)This case was brought to my attention by the great Docket Navigator.

As discussed last week, defendants are increasingly employing patent reexamination as a mechanism to stay a district court action. For this reason, patent owners must adapt their game plan. Last week’s post explained that an early motion for preliminary injunction can go a long way in demonstrating potential prejudice relative to a direct competitor. Additionally, while pending, an injunctive dispute may forestall the ability to stay the court action altogether.

In Medicis Pharmaceutical Corp., v. Acella Pharmaceuticals Inc. (DCAZ), the court explained that a motion to stay pending patent reexamination is inappropriate where a request for injuctive relief remains pending.
Continue Reading Pending Motion for Preliminary Injunction Precludes Stay

NTP Oral Arguments Reveal Disatisfaction with BPAIYesterday, the CAFC considered the patent reexamination appeals of NTP Inc. (see yesterday’s background post). In total, the CAFC heard just under 4 hours of oral arguments. The MP3 file can be found here.Throughout the arguments the CAFC made it clear that much of the Board of Patent Appeals & Interference (BPAI) record was inadequate as to claim construction. The court repeatedly expressed concern that the competing claim constructions offered by the two parties were not clearly differentiated on the BPAI record. Throughout the arguments, the court repeatedly emphasized that a remand to the BPAI seemed in order.  In the first hour, NTP contested the BPAI’s claim construction as inconsistent with the lexicographic definitions of the NTP patents. Throughout the first hour, the CAFC made it quite clear that the BPAI record was unclear as to a clear construction of the term “email.” Judge Moore was especially critical, at one point stating that the Board’s explanation as to this term  was “as wrong as wrong can be.” {48-52 min. mark}. Judge Moore noted that the the lack of fact finding in this regard seemed to require a remand. Judge Clevenger noted that the BPAI record “left a lot of openings.” {58 min. mark}In the second hour, the sufficiency of the antedating evidence was debated. The CAFC seemed to question the conception evidence presented by NTP, labeling it “amorphous.” Again Judge Moore emphasized the fact finding of the BPAI, stating “I don’t love the Board’s findings….I think you got that already” {1.36 min. mark}. Here again the antedating fact finding was so intertwined with claim construction that the CAFC seemed to throw up there hands. The Panel asked the solicitor whether it was fair for the CAFC to decide the issues, or whether a remand to the USPTO was better as an expert agency. {1.45 min. mark}In the third hour, the authenticity of a certain prior art document was debated (Telenor). The court asked NTP why they did not simply contact the authors to seek evidence that the document was fraudulent. NTP argued that the PTO needed to prove the authenticity of a one of a kind document. {2.05 min. mark} The court then seemed interested in whether public accessibility of a prior art reference is a question of law or fact. {2.15-18 min. mark} At the close of the third hour a variety of issues were debated. NTP argued that consideration of 35 U.S.C. § 120 priority was inappropriate as a backdoor 112 attack. {2.38 min. mark} Next, NTP argued that the same issue was considered in the original prosecution, and noted that if this practice is accepted it will open the floodgates to similar challenges in patent reexamination. The court didn’t seem overly receptive to the public policy argument. At the outset of the 4th hr, the CAFC asked NTP to identify those rejections that would not hinge on claim construction, and would not have to be remanded to the USPTO. The Court requested NTP & the USPTO file a list of issues that could be be decided independent of the remand on the claim construction of “email” within 10 days {3.02 min. mark}.What does this mean for NTP?The CAFC seems inclined to affirm certain rejections that do not turn on the definition of “email,” and decide the authenticity of the Telenor reference. It seems clear that the bulk of the issues will be remanded back to the BPAI. Long story short, this battle will continue for another 12-18 months…..at least.  Sorry BPAI, it’s coming ba

Yesterday, the CAFC considered the patent reexamination appeals of NTP Inc. (see yesterday’s background post). In total, the CAFC heard just under 4 hours of oral arguments. The MP3 file can be found here.

Throughout the arguments the CAFC made it clear that much of the Board of Patent Appeals & Interference (BPAI) record was inadequate as to claim construction. The court repeatedly expressed concern that the competing claim constructions offered by the two parties were not clearly differentiated on the BPAI record. Throughout the arguments, the court repeatedly emphasized that a remand to the BPAI seemed in order.  …
Continue Reading NTP Patent Reexaminations to be Remanded to BPAI?