Retroactive Correction of Patent ClaimsBack in March, I discussed the degree of change that can be secured from the USPTO via a Certificate of Correction (COC). As a reminder, one of the more limited methods to address errors in an issued patent is via COC as defined by 35 U.S.C. § 255. The statue provides that mistakes of a clerical or typographical nature, or of minor character may be corrected upon request. Such mistakes must have been made in good faith, and not constitute new matter or require reexamination.Once issued, a valid COC is only effective prospectively. For this reason, such certificates are best secured at the earliest possible date.Of course until claims are very closely scrutinized, the need for minor correction may not be so apparent. In cases where the COC is not secured for years, is there a mechanism available to retroactively correct a patent claim as to such minor errors?This issue was recently explored in Fujitsu Limited v. Tellabs Operations Inc., and Telllabs Inc. (NDIL).In Fujitsu U.S. Patent 5,386,418 was at issue. Claim 1 recited the language “and flag data;” this was a mistake. Claim 1 should have recited “a flag data.”Although the ‘418 Patent originally issued in 1995, a COC was not obtained until 2007, immediately prior to the Tellabs litigation.With respect to the claim language issue, Tellabs advanced two theories on summary judgment: (1) The COC was invalid for broadening the claims; and (2) claim 1, as issued, was indefinite.In ruling on these motions, the court explained that the COC corrected a minor issue, thus the COC was valid. For similar reasoning the court rejected argument (2).Fujitsu also sought summary judgment of its own, arguing that that the claim correction should be made retroactively, based on the doctrine of judicial correction. Tellalbs argued that the combination of a COC and judicial correction for the same patent was improper. The court agreed with Fujitsu, explaining, (full decision here):Although a valid certificate of correction is only effective prospectively, Southwest Software, Inc. v. Harlequin Inc., 226 F.3d 1280, 1295 (Fed. Cir. 2000) (“[F]or causes arising before its issuance, the certificate of correction is not effective.”), the district court can retroactively correct certain errors in a patent’s claims if “(1) the correction is not subject to reasonable debate based on consideration of the claim language and the specification and (2) the prosecution history does not suggest a different interpretation of the claims.” Novo Indus., L.P. v. Micro Molds Corp., 350 F.3d 1348, 1354, 1357 (Fed. Cir. 2003). These “determinations must be made from the point of view of one skilled in the art.” Ultimax Cement Mfg. v. CTS Cement Mfg., 587 F.3d 1339, 1353 (Fed. Cir. 2009).  .           .           .           .           .           .           .           .           .           . Neither Hoffer nor Ultimax suggests that the district court’s authority to correct a patent is constrained by the presence of a certificate of correction, and the court declines to impose such a proscription against judicial correction in this case. Consequently, the court agrees with Fujitsu that the Novo standard is the controlling standard for judicial correction, and the ‘418 Patent’s Certificate of Correction does not prevent this court from correcting the same error in claim 1.           .           .           .           .           .           .           .           .           . Patents provide an important notice function to the public and, as a result, post-issuance judicial corrections which have a retroactive effect must be carefully scrutinized. In this case, viewing the intrinsic evidence from the perspective of one of ordinary skill in the art, as the court must in determining whether a judicial correction is supported under Novo, this court finds that the only reasonable correction of claim 1 replaces “and flag bit data” with “a flag bit data.” A person of ordinary skill in the art, having reviewed the specification, drawings, and prosecution history, would have immediately recognized this error and understood what was claimed. The court accordingly corrects claim 1 of the ‘418 Patent to replace “and flag bit data” with “a flag bit data.”This case was brought to my attention by the great Docket Navigator.

Back in March, I discussed the degree of change that can be secured from the USPTO via a Certificate of Correction (COC). As a reminder, one of the more limited methods to address errors in an issued patent is via COC as defined by 35 U.S.C. § 255. The statue provides that mistakes of a clerical or typographical nature, or of minor character may be corrected upon request. Such mistakes must have been made in good faith, and not constitute new matter or require reexamination.

Once issued, a valid COC is only effective prospectively. For this reason, such certificates are best secured at the earliest possible date.

Of course until claims are very closely scrutinized, the need for minor correction may not be so apparent. In cases where the COC is not secured for years, is there a mechanism available to retroactively correct a patent claim as to such minor errors?

This issue was recently explored in Fujitsu Limited v. Tellabs Operations Inc., and Telllabs Inc. (NDIL).

In Fujitsu U.S. Patent 5,386,418 was at issue. Claim 1 recited the language “and flag data;” this was a mistake. Claim 1 should have recited “a flag data.”

Although the ‘418 Patent originally issued in 1995, a COC was not obtained until 2007, immediately prior to the Tellabs litigation.

With respect to the claim language issue, Tellabs advanced two theories on summary judgment: (1) The COC was invalid for broadening the claims; and (2) claim 1, as issued, was indefinite.

In ruling on these motions, the court explained that the COC corrected a minor issue, thus the COC was valid. For similar reasoning the court rejected argument (2).

Fujitsu also sought summary judgment of its own, arguing that that the claim correction should be made retroactively, based on the doctrine of judicial correction. Tellalbs argued that the combination of a COC and judicial correction for the same patent was improper. The court agreed with Fujitsu, explaining, (full decision here):

Although a valid certificate of correction is only effective prospectively, Southwest Software, Inc. v. Harlequin Inc., 226 F.3d 1280, 1295 (Fed. Cir. 2000) (“[F]or causes arising before its issuance, the certificate of correction is not effective.”), the district court can retroactively correct certain errors in a patent’s claims if “(1) the correction is not subject to reasonable debate based on consideration of the claim language and the specification and (2) the prosecution history does not suggest a different interpretation of the claims.” Novo Indus., L.P. v. Micro Molds Corp., 350 F.3d 1348, 1354, 1357 (Fed. Cir. 2003). These “determinations must be made from the point of view of one skilled in the art.” Ultimax Cement Mfg. v. CTS Cement Mfg., 587 F.3d 1339, 1353 (Fed. Cir. 2009).  

.           .           .           .           .           .           .           .           .           . 

Neither Hoffer nor Ultimax suggests that the district court’s authority to correct a patent is constrained by the presence of a certificate of correction, and the court declines to impose such a proscription against judicial correction in this case. Consequently, the court agrees with Fujitsu that the Novo standard is the controlling standard for judicial correction, and the ‘418 Patent’s Certificate of Correction does not prevent this court from correcting the same error in claim 1

.           .           .           .           .           .           .           .           .           . 

Patents provide an important notice function to the public and, as a result, post-issuance judicial corrections which have a retroactive effect must be carefully scrutinized. In this case, viewing the intrinsic evidence from the perspective of one of ordinary skill in the art, as the court must in determining whether a judicial correction is supported under Novo, this court finds that the only reasonable correction of claim 1 replaces “and flag bit data” with “a flag bit data.” A person of ordinary skill in the art, having reviewed the specification, drawings, and prosecution history, would have immediately recognized this error and understood what was claimed. The court accordingly corrects claim 1 of the ‘418 Patent to replace “and flag bit data” with “a flag bit data.”

This case was brought to my attention by the great Docket Navigator.

youre_hiredUSPTO Fills Critical Vacancy

As discussed back in October of last year, the USPTO has been looking for a new Chief Administrative Patent Judge for the BPAI. Last Friday, the Agency issued a formal announcement naming James Donald Smith as the new Chief Judge.

Like Commissioner Kappos before him, Mr. Smith comes to the USPTO from private practice (formal announcement here). Smith currently serves as Associate General and Chief Intellectual Property Counsel of Illinois-based healthcare company, Baxter International, where he oversees its global patent, trademark and copyright affairs. He replaces Michael Fleming, the former Chief Judge who retired in the fall of 2010.

The new Chief Judge will have his hand’s full dealing with the current appeal backlog and the possible transformation of the BPAI to the Patent Trail & Appeal Board.

Stay of California Litigation Extended to Await USPTO ClarificationTypically, once a case is stayed pending patent reexamination, periodic status updates are provided to the judge. Depending upon the progress of the patent reexamination proceedings, the judge may consider lifting the stay to move forward with the litigation. For example, where claims are confirmed/allowed, a judge is likely to consider lifting the stay.Recently, in Cellectricon AB and Gyros AB v. Fluxion Biosciences Inc. (NDCA) a status report was provided to the juge noting the progress of four patent reexamination proceedings corresponding to the patents-in-suit. (7,470,518; 7,390,650; 7,563,614; and 5,376,252) The ‘252 was subject to ex parte patent reexamination and recently concluded with its claims being confirmed, the other three patents were subjected to inter partes patent reexaminations that are still in progress. In one of these three cases claims were also confirmed by the examiner, but subject to appeal to the BPAI. Based on the positive developments, the plaintiff patentee sought to lift the stay. However, in determining whether or not to lift the stay, the judge was troubled  by the seemingly inconsistent inter partes patent reexamination results.Two of the three patents ininter partes patent reexaminations were related, one was the parent of the other. Both patents included the same claim language, and were rejected based upon the same prior art reference. Yet, the parent was allowed over the reference, while the child was not, the court pointed out this seeming inconsistency, noting: (full decision here)The PTO has initially rejected the ‘518 patent claims while simultaneously upholding the reexamined ‘614 patent claims. Notably, the ‘614 patent is the parent of the ‘518 patent, and they share a common specification. Both patents also share a claim limitation requiring application of fluids through three or more outlets. In the ‘518 Office Action, the examiners determined that the U.S. Patent Publication No.2002/0182627 by Wang et al. (“Wang”) anticipates the claims at issue because Wang discloses “multiple reagent channels feeding the portion of the channel where the biosensor is located.” Dkt. No. 131-2 at 9. Nine days later, the same examiners issued an Office Action in the ‘614 patent reexamination. But this time, the examiners confirmed the validity of the ‘614 patent claims, noting that “[w]hile Wang does appear to teach sequential application of multiple fluids through a single outlet, Wang does not clearly teach or suggest application through 3 or more outlets . . . .” Dkt. No. 120-3 at 5. In other words, the examiners appear to reach conflicting conclusions as to whether the Wang prior art reference discloses “multiple outlets.” The parties note that briefing and Office Actions in 2011 should clarify the inconsistency. Although the court is generally reluctant to stay a case because of the potential delay in obtaining a final resolution from the PTO or the Federal Circuit, here, the court finds that there is a legitimate basis for temporarily staying the case to see how the reexamination process will resolve the apparent conflict.The stay was lifted as to the ‘252 Patent, the court will monitor the progress of the inter partes cases further before lifting the stay with respect to those patents.This case was brought to my attention by the great Docket Navigator.

Typically, once a case is stayed pending patent reexamination, periodic status updates are provided to the judge. Depending upon the progress of the patent reexamination proceedings, the judge may consider lifting the stay to move forward with the litigation. For example, where claims are confirmed/allowed, a judge is likely to consider lifting the stay.

Recently, in Cellectricon AB and Gyros AB v. Fluxion Biosciences Inc. (NDCA) a status report was provided to the juge noting the progress of four patent reexamination proceedings corresponding to the patents-in-suit. (7,470,518; 7,390,650; 7,563,614; and 5,376,252) The ‘252 was subject to ex parte patent reexamination and recently concluded with its claims being confirmed, the other three patents were subjected to inter partes patent reexaminations that are still in progress. In one of these three cases claims were also confirmed by the examiner, but subject to appeal to the BPAI. Based on the positive developments, the plaintiff patentee sought to lift the stay. However, in determining whether or not to lift the stay, the judge was troubled  by the seemingly inconsistent inter partes patent reexamination results.

Two of the three patents ininter partes patent reexaminations were related, one was the parent of the other. Both patents included the same claim language, and were rejected based upon the same prior art reference. Yet, the parent was allowed over the reference, while the child was not, the court pointed out this seeming inconsistency, noting: (full decision here)

The PTO has initially rejected the ‘518 patent claims while simultaneously upholding the reexamined ‘614 patent claims. Notably, the ‘614 patent is the parent of the ‘518 patent, and they share a common specification. Both patents also share a claim limitation requiring application of fluids through three or more outlets. In the ‘518 Office Action, the examiners determined that the U.S. Patent Publication No.2002/0182627 by Wang et al. (“Wang”) anticipates the claims at issue because Wang discloses “multiple reagent channels feeding the portion of the channel where the biosensor is located.” Dkt. No. 131-2 at 9. Nine days later, the same examiners issued an Office Action in the ‘614 patent reexamination. But this time, the examiners confirmed the validity of the ‘614 patent claims, noting that “[w]hile Wang does appear to teach sequential application of multiple fluids through a single outlet, Wang does not clearly teach or suggest application through 3 or more outlets . . . .” Dkt. No. 120-3 at 5. In other words, the examiners appear to reach conflicting conclusions as to whether the Wang prior art reference discloses “multiple outlets.” The parties note that briefing and Office Actions in 2011 should clarify the inconsistency. Although the court is generally reluctant to stay a case because of the potential delay in obtaining a final resolution from the PTO or the Federal Circuit, here, the court finds that there is a legitimate basis for temporarily staying the case to see how the reexamination process will resolve the apparent conflict.

The stay was lifted as to the ‘252 Patent, the court will monitor the progress of the inter partes cases further before lifting the stay with respect to those patents.

This case was brought to my attention by the great Docket Navigator.

The Five Reexamination Proceedings of Patent ReformAs discussed earlier in the week , the USPTO has proposed changes to ex parte patent reexamination practice (substantively untouched in the legislation), and has proposed to refine inter partes patent reexamination (this proceeding will remain viable during the multi-year transition period provided for in the pending bills). The changes are designed to ensure that these important post grant proceedings continue to be responsive to the increasing public demandOf course, with Congress back in session next week, it is expected that the pending patent reform legislation will be at the top of the legislative agenda. Today, I am sharing an overview of the 5 separate reexamination-type proceedings before Congress in S.23 (note H.R. 1249, after the manager’s amendment includes minor changes with respect to S.23).The five “reexamination-type” proceedings are as follows:1. Post Grant Review2. Inter Partes Review3. Supplemental Examination4. Transitional Program for Business Method Patents5. Ex Parte Patent Reexamination (not substantively altered in either bill)A comprehensive overview of these five proceedings as presented in S.23 has been detailed in the attached paper, written by Paul Morgan & Gary Cohen (paper here

As discussed earlier in the week , the USPTO has proposed changes to ex parte patent reexamination practice (substantively untouched in the legislation), and has proposed to refine inter partes patent reexamination (this proceeding will remain viable during the multi-year transition period provided for in the pending bills). The changes are designed to ensure that these important post grant proceedings continue to be responsive to the increasing public demand

Of course, with Congress back in session next week, it is expected that the pending patent reform legislation will be at the top of the legislative agenda. Today, I am sharing an overview of the 5 separate reexamination-type proceedings before Congress in S.23 (note H.R. 1249, after the manager’s amendment includes minor changes with respect to S.23).

The five “reexamination-type” proceedings are as follows:

1. Post Grant Review

2. Inter Partes Review

3. Supplemental Examination

4. Transitional Program for Business Method Patents

5. Ex Parte Patent Reexamination (not substantively altered in either bill)

A comprehensive overview of these five proceedings as presented in S.23 has been detailed in the attached paper, written by Paul Morgan & Gary Cohen (paper here).

June Meeting to Consider Proposed Changes

As discussed previously, the USPTO has been hard at work formulating proposed changes to patent reexamination that would reduce pendency and streamline these important office proceedings as a transitional step toward implementing the legislative changes of the America Invents Act. Tomorrow, the USPTO will publish a collection of working concepts and initiatives in the Federal Register. Based upon public commentary, the USPTO will later implement the various proposals via a formal rule-making process, or through internal policy changes. (an advance copy of the proposal is found here)The proposals are directed to both ex parte and inter partes patent reexamination. Some of the more interesting proposals include an examiner identifying a representative SNQ from a group of cumulative SNQs, and a requirement that requesters explain how submitted SNQs are different with respect to each other. (See my January 2010 proposal of these very solutions here).A short overview of each proposal is detailed next:Ex Parte & Inter Partes ProposalsStandardization of Patent Reexamination Request Formats (Proposals 1-2)Proposal 1 would require, as part of the presentation of the SNQ, an explanation of how the SNQ is different from issues previously considered by the Office. While an SNQ discussion should always explain how a technological teaching is “new,” the USPTO finds that this practice inconsistent. As such, Proposal 1 seems more of an attempt to codify a current best practice.  Proposal 2 also appears to be an attempt to codify a current best practice of identifying all limitations of a claim. Interestingly, the proposal states that this can be done via claim chart or narrative, but not both.SNQ Management (Proposals 3-4)Proposal 3 would allow examiners to more readily group proposed SNQs as cumulative with respect to others unless Requesters explain why seemingly cumulative SNQs are unique. If an examiner finds cumulative SNQs, one will be selected as representative of the group.  Proposal 4 outlines the manner by which representative rejections are grouped by an examiner, and how they are appealed together with all adopted rejections. The selection of a representative rejection is not petitionable, however, Inter Partes Requesters may comment on the selection of a particular rejection (more on that below)Limiting Requester Declaration Evidence to Rebuttal (Proposal 5)Proposal 5  would require most third party declaration evidence to be submitted together with the request. Later submissions would be limited to rebuttal of points raised by the examiner or patent owner. Any submission of such evidence after the request stage would require a statement as to how the evidence is limited to issues newly raised.Limiting Patent Owner Amendments to First Action (Proposal 6)Proposal 6 arguably reflects current practice. Namely, amendments must be submitted before a final rejection unless directed to a matter of form, claim cancellation or the like. This proposal alludes to the fact that Patentees refusing to waive the patent owner statement may surrender their right to amend altogether. (more on the change to the pilot program below)Requiring Statement of Compliance with 35 U.S.C. § 305 (Proposal 7)Proposal 7would require all amendments to be accompanied by a statement explaining how the change is directed to overcoming an SNQ. The concern here is that changes may be made to claims for reasons unrelated to patentability, such as claim construction. Of course, such changes are already improper based upon 35 U.S.C. § 305. This statement would be an additional safeguard for defendants seeking patent reexamination parallel to litigation claim construction proceedings. (i.e., inequitable conduct opportunity)Clarify Petition Practice (Proposal 8)Perhaps the most immediately helpful aspect of the various proposals is provided below. The chart below clearly explains when it is appropriate to oppose the most common patent reexamination petitions.            Examples of Petitions Filed in Reexamination ProceedingsRelief requestedPetitionable?Opposable?Review of refusal to grant ex parte or inter partes reexam (see MPEP 2248, 2648)Yes—1.181No.Vacate as ultra vires an order granting ex parte or inter partes reexam (see MPEP 2246, 2646)Yes—1.181Yes.Review of a finding of an SNQ in an order granting ex parte or inter partes reexam (see 75 FR 36357)No (but see 75 FR 36357in ex parte reexam)No.Vacate filing date of ex parte or inter partes reexam based on failure to comply with 37 CFR 1.510 or 1.915Yes—1.181Yes.Extension of time to respond to an Office action by Patent Owner in ex parte reexamYes—1.550(c)No.Extension of time to respond to an Office action by Patent Owner in inter partes reexamYes—1.956No.Extension of time to submit comments by Third Party Requester (see 35 USC 314(b)(2))NoNo.Extension of time to file a notice of appeal or brief on appeal by Patent Owner in ex parte reexam (see 37 CFR 41.31, 41.37, 41.43)Yes—1.550(c)No.Extension of time to file a notice of appeal or brief on appeal by any party in inter partes reexam (see 37 CFR 41.61, 41.66)Yes—1.183No.Striking another party’s improper paper (or portion thereof) from the fileYes—1.181Yes.Protection of proprietary information being submitted under sealYes—1.59(b)Yes.Waiver of page or word limit requirementYes—1.183No.Review of refusal to enter amendmentYes—1.181Yes.Withdrawal of final Office actionYes—1.181Yes.Revival of terminated proceeding based on Patent Owner’s “unavoidable” delay and acceptance of late paperYes—1.137(a)No.Revival of terminated proceeding based on Patent Owner’s “unintentional” delay and acceptance of late paperYes—1.137(b)No.For jurisdiction to be transferred to the Office of Patent Legal AdministrationNoNo.Suspend inter partes reexam for “good cause” under 35 USC 314(c)Yes—1.182Yes.Terminate inter partes reexam based on estoppel under 35 USC 317(b)Yes—1.182Yes.Ex Parte Proposals OnlyMake Pilot Program for Waiver of Patent Owner Statement Permanent (Proposal 1)Proposal 1  would permanently adopt the Program for Waiver in ex parte patent reexamination proceedings.Allow for First Action Final for Patentees Refusing to Waive Statement (Proposal 2)Proposal 2 recognizes that although the Waiver Program provides a great opportunity for the Office to reduce pendency, to date, Patentees are not cooperating. (see my most recent case study on this issue here). This rule would essentially punish those Patentees that do not agree to the waiver, by issuing a first action final. If the Patentee agrees to waiver, a first action would issue together with the grant, otherwise, a provisional first action is issued with the grant, and after the statement period, a final action is issued.Inter Partes Proposals OnlyAbility to Dispute Representative SNQ Finding (Proposal 1)Proposal 1 would allow a Requester to present arguments directed to those rejections held in abeyance as cumulative. (to either the examiner or Board)Consolidate ACP/RAN Practice to More Traditional Final Rejection (Proposal 2)Proposal 2 would eliminate the ACP/RAN practice and replace it with a final office action. This proposal would require amendments to 37 C.F.R. §§ 1.949-1.953. (This change would shave considerable time off of pendency figures).Eliminate Cross Appeal Practice (Proposal 3)Proposal 3 would no longer allow third parties to appeal those rejections that are not adopted in cases where the claims stand rejected on other grounds. The PTO points out that this change would be consistent with appellate practice of the district courts.OtherIn addition to these proposals, the USPTO seeks feedback on the following general propositions:1. Should the USPTO proceed with any efforts to streamline the procedures governing ex parte and/or inter partes reexamination proceedings?2. Should the USPTO place word limits on requests for ex parte and/or inter partes reexamination?3. Should the USPTO revise its existing page or word limits in inter partes reexamination following the request?4. Should the USPTO place any limitation or criteria on the addition of new claims by a Patent Owner in reexamination? If so, what kind of limitation or criteria?5. Should the USPTO change its interpretation of ‘‘a substantial new question of patentability’’ to require something more than ‘‘a substantial likelihood that a reasonable examiner would consider the prior art patent or printed publication important in deciding whether or not the claim is patentable’’? See MPEP §§ 2242, 2642. If so, how should it be interpreted?6. How much time should Patent Owners and Third Party Requesters ordinarily be given to submit a statement, response, or appeal where the time for filing the statement, response, or appeal is set by the USPTO rather than by statute?7. Under what conditions should the USPTO grant a Patent Owner’s request for an extension of time under 37 CFR 1.550(c) or 1.956, both of which provide that extensions of time may only be granted for ‘‘sufficient cause and for a reasonable time specified’’? 8. Should the USPTO require that any information disclosure statement (IDS) filed by a Patent Owner in a reexamination comply with provisions analogous to 37 CFR 1.97 and 1.98, and further require that any IDS filed after a Notice of Intent to Issue a Reexamination Certificate (NIRC) or notice of appeal be accompanied by:     (1) an explanation of why the information submitted could not have been submitted earlier, and (2) an explanation of the relevance of the information with regard to the claimed invention? 9. Under what conditions should a reexamination proceeding be merged with another reexamination or reissue proceeding? 10. What relief can and should be given to a Third Party Requester that shows that it did not receive a Patent Owner’s statement or response within a certain number of days after the date listed on the Patent Owner’s certificate of service? How many days and what kind of showing should be required? 11. Should the USPTO encourage and/or require that all correspondence in reexamination proceedings be conducted electronically (e.g., e-filing parties’ documents, e-mailing notices of Office actions and certificates)? 12. Should reexamination proceedings remain with the Board in cases where the Board has entered a new ground of rejection on appeal and the Patent Owner seeks to introduce new evidence and amendments? In particular, is it more efficient for three administrative patent judges or a single examiner to decide issues involving new evidence and amendments? 13. What other changes can and should the USPTO make in order to streamline reexamination proceedings?I will explore many of these issues in more detail in the weeks to come.
As discussed previously, the USPTO has been hard at work formulating proposed changes to patent reexamination that would reduce pendency and streamline these important office proceedings as a transitional step toward implementing the legislative changes of the America Invents Act. Tomorrow, the USPTO will publish a collection of working concepts and initiatives in the Federal Register. Based upon public commentary, the USPTO will later implement the various proposals via a formal rule-making process, or through internal policy changes. (an advance copy of the proposal is found here)

The proposals are directed to both ex parte and inter partes patent reexamination. Some of the more interesting proposals include an examiner identifying a representative SNQ from a group of cumulative SNQs, and a requirement that requesters explain how submitted SNQs are different with respect to each other. (See my January 2010 proposal of these very solutions here).

A short overview of each proposal is detailed next:

Ex Parte & Inter Partes Proposals

Standardization of Patent Reexamination Request Formats (Proposals 1-2)

Proposal 1 would require, as part of the presentation of the SNQ, an explanation of how the SNQ is different from issues previously considered by the Office. While an SNQ discussion should always explain how a technological teaching is “new,” the USPTO finds that this practice inconsistent. As such, Proposal 1 seems more of an attempt to codify a current best practice.

Proposal 2 also appears to be an attempt to codify a current best practice of identifying all limitations of a claim. Interestingly, the proposal states that this can be done via claim chart or narrative, but not both.

SNQ Management (Proposals 3-4)

Proposal 3 would allow examiners to more readily group proposed SNQs as cumulative with respect to others unless Requesters explain why seemingly cumulative SNQs are unique. If an examiner finds cumulative SNQs, one will be selected as representative of the group.

Proposal 4 outlines the manner by which representative rejections are grouped by an examiner, and how they are appealed together with all adopted rejections. The selection of a representative rejection is not petitionable, however, Inter Partes Requesters may comment on the selection of a particular rejection (more on that below)

Limiting Requester Declaration Evidence to Rebuttal (Proposal 5)

Proposal 5  would require most third party declaration evidence to be submitted together with the request. Later submissions would be limited to rebuttal of points raised by the examiner or patent owner. Any submission of such evidence after the request stage would require a statement as to how the evidence is limited to issues newly raised.

Limiting Patent Owner Amendments to First Action (Proposal 6)

Proposal 6 arguably reflects current practice. Namely, amendments must be submitted before a final rejection unless directed to a matter of form, claim cancellation or the like. This proposal alludes to the fact that Patentees refusing to waive the patent owner statement may surrender their right to amend altogether. (more on the change to the pilot program below)

Requiring Statement of Compliance with 35 U.S.C. § 305 (Proposal 7)

Proposal 7would require all amendments to be accompanied by a statement explaining how the change is directed to overcoming an SNQ. The concern here is that changes may be made to claims for reasons unrelated to patentability, such as claim construction. Of course, such changes are already improper based upon 35 U.S.C. § 305. This statement would be an additional safeguard for defendants seeking patent reexamination parallel to litigation claim construction proceedings. (i.e., inequitable conduct opportunity)

Clarify Petition Practice (Proposal 8)

Perhaps the most immediately helpful aspect of the various proposals is provided below. The chart below clearly explains when it is appropriate to oppose the most common patent reexamination petitions.

            Examples of Petitions Filed in Reexamination Proceedings

Relief requested

Petitionable?

Opposable?
Review of refusal to grant ex parte or inter partes reexam (see MPEP 2248, 2648) Yes—1.181 No.
Vacate as ultra vires an order granting ex parte or inter partes reexam (see MPEP 2246, 2646) Yes—1.181 Yes.
Review of a finding of an SNQ in an order granting ex parte or inter partes reexam (see 75 FR 36357) No (but see 75 FR 36357in ex parte reexam) No.
Vacate filing date of ex parte or inter partes reexam based on failure to comply with 37 CFR 1.510 or 1.915 Yes—1.181 Yes.
Extension of time to respond to an Office action by Patent Owner in ex parte reexam Yes—1.550(c) No.
Extension of time to respond to an Office action by Patent Owner in inter partes reexam Yes—1.956 No.
Extension of time to submit comments by Third Party Requester (see 35 USC 314(b)(2)) No No.
Extension of time to file a notice of appeal or brief on appeal by Patent Owner in ex parte reexam (see 37 CFR 41.31, 41.37, 41.43) Yes—1.550(c) No.
Extension of time to file a notice of appeal or brief on appeal by any party in inter partes reexam (see 37 CFR 41.61, 41.66) Yes—1.183 No.
Striking another party’s improper paper (or portion thereof) from the file Yes—1.181 Yes.
Protection of proprietary information being submitted under seal Yes—1.59(b) Yes.
Waiver of page or word limit requirement Yes—1.183 No.
Review of refusal to enter amendment Yes—1.181 Yes.
Withdrawal of final Office action Yes—1.181 Yes.
Revival of terminated proceeding based on Patent Owner’s “unavoidable” delay and acceptance of late paper Yes—1.137(a) No.
Revival of terminated proceeding based on Patent Owner’s “unintentional” delay and acceptance of late paper Yes—1.137(b) No.
For jurisdiction to be transferred to the Office of Patent Legal Administration No No.
Suspend inter partes reexam for “good cause” under 35 USC 314(c) Yes—1.182 Yes.
Terminate inter partes reexam based on estoppel under 35 USC 317(b) Yes—1.182 Yes.

Ex Parte Proposals Only

Make Pilot Program for Waiver of Patent Owner Statement Permanent (Proposal 1)

Proposal 1  would permanently adopt the Program for Waiver in ex parte patent reexamination proceedings.

Allow for First Action Final for Patentees Refusing to Waive Statement (Proposal 2)

Proposal 2 recognizes that although the Waiver Program provides a great opportunity for the Office to reduce pendency, to date, Patentees are not cooperating. (see my most recent case study on this issue here). This rule would essentially punish those Patentees that do not agree to the waiver, by issuing a first action final. If the Patentee agrees to waiver, a first action would issue together with the grant, otherwise, a provisional first action is issued with the grant, and after the statement period, a final action is issued.

Inter Partes Proposals Only

Ability to Dispute Representative SNQ Finding (Proposal 1)

Proposal 1 would allow a Requester to present arguments directed to those rejections held in abeyance as cumulative. (to either the examiner or Board)

Consolidate ACP/RAN Practice to More Traditional Final Rejection (Proposal 2)

Proposal 2 would eliminate the ACP/RAN practice and replace it with a final office action. This proposal would require amendments to 37 C.F.R. §§ 1.949-1.953. (This change would shave considerable time off of pendency figures).

Eliminate Cross Appeal Practice (Proposal 3)

Proposal 3 would no longer allow third parties to appeal those rejections that are not adopted in cases where the claims stand rejected on other grounds. The PTO points out that this change would be consistent with appellate practice of the district courts.

Other

In addition to these proposals, the USPTO seeks feedback on the following general propositions:

1. Should the USPTO proceed with any efforts to streamline the procedures governing ex parte and/or inter partes reexamination proceedings?

2. Should the USPTO place word limits on requests for ex parte and/or inter partes reexamination?

3. Should the USPTO revise its existing page or word limits in inter partes reexamination following the request?

4. Should the USPTO place any limitation or criteria on the addition of new claims by a Patent Owner in reexamination? If so, what kind of limitation or criteria?

5. Should the USPTO change its interpretation of ‘‘a substantial new question of patentability’’ to require something more than ‘‘a substantial likelihood that a reasonable examiner would consider the prior art patent or printed publication important in deciding whether or not the claim is patentable’’? See MPEP §§ 2242, 2642. If so, how should it be interpreted?

6. How much time should Patent Owners and Third Party Requesters ordinarily be given to submit a statement, response, or appeal where the time for filing the statement, response, or appeal is set by the USPTO rather than by statute?

7. Under what conditions should the USPTO grant a Patent Owner’s request for an extension of time under 37 CFR 1.550(c) or 1.956, both of which provide that extensions of time may only be granted for ‘‘sufficient cause and for a reasonable time specified’’?

 8. Should the USPTO require that any information disclosure statement (IDS) filed by a Patent Owner in a reexamination comply with provisions analogous to 37 CFR 1.97 and 1.98, and further require that any IDS filed after a Notice of Intent to Issue a Reexamination Certificate (NIRC) or notice of appeal be accompanied by:

     (1) an explanation of why the information submitted could not have been submitted earlier, and (2) an explanation of the relevance of the information with regard to the claimed invention?

 9. Under what conditions should a reexamination proceeding be merged with another reexamination or reissue proceeding?

 10. What relief can and should be given to a Third Party Requester that shows that it did not receive a Patent Owner’s statement or response within a certain number of days after the date listed on the Patent Owner’s certificate of service? How many days and what kind of showing should be required?

 11. Should the USPTO encourage and/or require that all correspondence in reexamination proceedings be conducted electronically (e.g., e-filing parties’ documents, e-mailing notices of Office actions and certificates)?

 12. Should reexamination proceedings remain with the Board in cases where the Board has entered a new ground of rejection on appeal and the Patent Owner seeks to introduce new evidence and amendments? In particular, is it more efficient for three administrative patent judges or a single examiner to decide issues involving new evidence and amendments?

 13. What other changes can and should the USPTO make in order to streamline reexamination proceedings?

I will explore many of these issues in more detail in the weeks to come. Also, as I will be coordinating the ABA response to these proposals, I welcome any and all comments.

USPTO Cuts Expenses to Account for $85-100 Million ShortfallIn an email today to all USPTO staff, Director Kappos explained that the agency will be unable to spend the $85-100 million in fees being collected in FY 2011. Thus, effective immediately, and likely beyond the end of FY 2011 (September 30, 2011) the following cost cutting measures have been implemented: All overtime is suspended until further notice; Hiring—both for new positions and for backfills—is frozen for the rest of the year unless an exemption is given by the Office of the Under Secretary;   Funding for employee training will be limited to mandatory training for the remainder of  the year; Funding for contracting of Patent Cooperation Treaty (PCT) search is significantly reduced;   The opening of the planned Nationwide Workforce satellite office in Detroit and any consideration of other satellite locations are postponed until further notice; Only limited funding will be available for mission-critical IT capital  investments; The Track One expedited patent examination program, scheduled to go into effect on May 4, 2011, is postponed until further notice.It is unclear what the impact will be on the Cental Reexamination Unit (CRU). As discussed previously, the unit was scheduled to hire a group of examiners for temporary assignment, the status of that program remains unknown.As Congress continues to consider the Patent Reform legislation, especially fee diversion, this development will hopefully foster an even greater sense of urgen

In an email today to all USPTO staff, Director Kappos explained that the agency will be unable to spend the $85-100 million in fees being collected in FY 2011. Thus, effective immediately, and likely beyond the end of FY 2011 (September 30, 2011) the following cost cutting measures have been implemented:

  • All overtime is suspended until further notice;

  • Hiring—both for new positions and for backfills—is frozen for the rest of the year unless an exemption is given by the Office of the Under Secretary;  

  • Funding for employee training will be limited to mandatory training for the remainder of  the year;

  • Funding for contracting of Patent Cooperation Treaty (PCT) search is significantly reduced;  

  • The opening of the planned Nationwide Workforce satellite office in Detroit and any consideration of other satellite locations are postponed until further notice;

  • Only limited funding will be available for mission-critical IT capital  investments;

  • The Track One expedited patent examination program, scheduled to go into effect on May 4, 2011, is postponed until further notice.

It is unclear what the impact will be on the Cental Reexamination Unit (CRU). As discussed previously, the unit was scheduled to hire a group of examiners for temporary assignment, the status of that program remains unknown.

As Congress continues to consider the Patent Reform legislation, especially fee diversion, this development will hopefully foster an even greater sense of urgency.

In re Lund Affirmed Per CuriamLast May, Ex parte Lund was decided by the Board of Patent Appeals & Interferences (BPAI) (here). In the decision, the Board affirmed the rejection of the reexamined claims based upon the construction of the claim language electrical connecting means adapted to electrically connect said display means and said data entry array to said computer means in both said first and said second positions.The Patentee urged that the means-plus-function structure corresponding to the electrical connecting means was limited to the specific mechanical orientation of the connectors shown in the Lund patent (Figs 12 and 15). Yet, the Board found that the function recited only required an electrical connection, such as provided by the ribbon cable or slot connector of the specification.Unhappy with the Board’s decision, the Patentee appealed to the CAFC, emphasizing the first and second position aspects of the claimed function, explaining that this language demonstrated that the connector must be mechanically oriented in a specific fashion. Lund’s claim 1 is directed to a laptop computer. The first position is the usual clam-shell orientation (open), the second position enabled the user to rotate the screen and collapse it down on the keyboard in a tablet computer fashion. This was done by removing the screen from a slot connector, reversing the screen and re-inserting it to the connector, or by way of a flexible ribbon cable. (see below)The prior art showed reversible screens that could be moved between such positions, but the electrical connections were distinguishable from those shown in Lund’s patent, at least with respect to mechanical positioning. The orientation sought by Lund is shown below as illustrated in Figs 12 and 15 of the patent.During oral argument, the CAFC noted that the positional features argued were already present in dependent claims 2-8 of the Lund Patent. These claims were not subject to patent reexamination. In an awkward moment for the Patentee, Judge Lourie asked the Patentee why he was on appeal since claims 2-8 already captured what was being argued, and that these claims stood uncontested. Judge Lourie also pointed out that claim differentiation would seem to require a broader reading of claim 1. The Patentee did not have any meaningful rebuttal to these inquiries.Ultimately, the CAFC seemed to agree with the Solicitor that although the claimed electrical connecting means was limited to the structure of the specification, in this case the card or ribbon connector, the function recited did not require any specific mechanical orientation to achieve the recited electrical connection function. So, although other aspects of claim 1 required specific mechanical interaction between components, the function of the electrical connecting means required only connectivity. Absent the existence of the dependent claims, perhaps this case would have been a closer ca

Last May, Ex parte Lund was decided by the Board of Patent Appeals & Interferences (BPAI) (here). In the decision, the Board affirmed the rejection of the reexamined claims based upon the construction of the claim language electrical connecting means adapted to electrically connect said display means and said data entry array to said computer means in both said first and said second positions.

The Patentee urged that the means-plus-function structure corresponding to the electrical connecting means was limited to the specific mechanical orientation of the connectors shown in the Lund patent (Figs 12 and 15). Yet, the Board found that the function recited only required an electrical connection, such as provided by the ribbon cable or slot connector of the specification.

Unhappy with the Board’s decision, the Patentee appealed to the CAFC, emphasizing the first and second position aspects of the claimed function, explaining that this language demonstrated that the connector must be mechanically oriented in a specific fashion. 

Lund’s claim 1 is directed to a laptop computer. The first position is the usual clam-shell orientation (open), the second position enabled the user to rotate the screen and collapse it down on the keyboard in a tablet computer fashion. This was done by removing the screen from a slot connector, reversing the screen and re-inserting it to the connector, or by way of a flexible ribbon cable. (see below)

The prior art showed reversible screens that could be moved between such positions, but the electrical connections were distinguishable from those shown in Lund’s patent, at least with respect to mechanical positioning. The orientation sought by Lund is shown below as illustrated in Figs 12 and 15 of the patent.

1215

During oral argument, the CAFC noted that the positional features argued were already present in dependent claims 2-8 of the Lund Patent. These claims were not subject to patent reexamination. In an awkward moment for the Patentee, Judge Lourie asked the Patentee why he was on appeal since claims 2-8 already captured what was being argued, and that these claims stood uncontested. Judge Lourie also pointed out that claim differentiation would seem to require a broader reading of claim 1. The Patentee did not have any meaningful rebuttal to these inquiries.

Ultimately, the CAFC seemed to agree with the Solicitor that although the claimed electrical connecting means was limited to the structure of the specification, in this case the card or ribbon connector, the function recited did not require any specific mechanical orientation to achieve the recited electrical connection function. So, although other aspects of claim 1 required specific mechanical interaction between components, the function of the electrical connecting means required only connectivity. Absent the existence of the dependent claims, perhaps this case would have been a closer call.

Supplemental Examination Request to Invite Investigation?Under current law, inequitable conduct cannot be cured through patent reissue or patent reexamination. As such, one of the more interesting aspects of the proposed patent reform legislation is the concept of “Supplemental Examination.”  Supplemental examination, as currently proposed, will permit the patent owner to cure inequitable conduct resulting from violations of the duty of candor and good faith as well as the duty of disclosure with intent to deceive the USPTO so long as it is done promptly and prior to litigation.Of course, the USPTO Director will be able to continue to investigate issues of possible misconduct and impose sanctions such as those set forth in 37 CFR 11.18(c) such as striking a paper; referring a practitioner’s conduct to the Director of Enrollment and Discipline (OED) for appropriate action; precluding a party or practitioner from submitting a paper or contesting an issue; affecting the weight given to a paper; and terminating the proceedings in the Office. Thus, the concept of Supplemental Examination appears to be directed to gray areas and close calls, as opposed to providing a second bite at the apple for true “villains.”To reinforce the idea that Supplemental Examination is not meant to provide amnesty for gross misconduct, an amendment was added to H.R. 1249 to make clear that “fraud” is to be rooted out by the Director. Not surprisingly, industry groups are less than enthusiastic about this provision. The amendment (here), proposed by Congressman Goodlatte (VA) provides:(C) FRAUD.–No supplemental examination shall be commenced by the Director on, and any pending supplemental examination shall be terminated regarding, an application or patent in connection with which fraud on the Office was practiced or attempted. If the Director determines that such a fraud on the Office was practiced or attempted, the Director shall refer the matter to the Attorney General for such action as the Attorney General may deem appropriate. The Biotechnology Industry Organization (BIO) released the following comment on the Goodlatte amendment:The supplemental examination provision as passed by the Senate and originally included in the House bill would allow patent holders to seek a review of their issued patents at their own risk.  The Goodlatte amendment undercuts this provision by creating disincentives for patent owners to use the new procedure by having the U.S. Patent and Trademark Office (PTO) act as quasi-investigative body.Since disbanding the “fraud squad” years back, the Office has not proactively pursued inequitable conduct issues, that is, aside from the few cases presented to OED by the public, or that result from final court determinations. The USPTO has made clear that the agency is ill suited to pursue investigations into inequitable conduct due to a lack of resources, subpoena power, etc.It seems that the rationale behind the Goodlatte amendment is to ensure that supplemetal examination is not abused as a “get out of jail free” card by the unscrupulous—yet, such cases are the rare exception (despite the plague of inequitable conduct charges to the contrary in almost every patent litigation). The added provision would arguably require the Director to investigate every request for the sake of rooting out the rare exception. This duty would potentially turn every request into a witch hunt—no thank y

Under current law, inequitable conduct cannot be cured through patent reissue or patent reexamination. As such, one of the more interesting aspects of the proposed patent reform legislation is the concept of “Supplemental Examination.”  Supplemental examination, as currently proposed, will permit the patent owner to cure inequitable conduct resulting from violations of the duty of candor and good faith as well as the duty of disclosure with intent to deceive the USPTO so long as it is done promptly and prior to litigation.

Of course, the USPTO Director will be able to continue to investigate issues of possible misconduct and impose sanctions such as those set forth in 37 CFR 11.18(c) such as striking a paper; referring a practitioner’s conduct to the Director of Enrollment and Discipline (OED) for appropriate action; precluding a party or practitioner from submitting a paper or contesting an issue; affecting the weight given to a paper; and terminating the proceedings in the Office. Thus, the concept of Supplemental Examination appears to be directed to gray areas and close calls, as opposed to providing a second bite at the apple for true “villains.”

To reinforce the idea that Supplemental Examination is not meant to provide amnesty for gross misconduct, an amendment was added to H.R. 1249 to make clear that “fraud” is to be rooted out by the Director. Not surprisingly, industry groups are less than enthusiastic about this provision.  The amendment (here), proposed by Congressman Goodlatte (VA) provides:

(C) FRAUD.–No supplemental examination shall be commenced by the Director on, and any pending supplemental examination shall be terminated regarding, an application or patent in connection with which fraud on the Office was practiced or attempted. If the Director determines that such a fraud on the Office was practiced or attempted, the Director shall refer the matter to the Attorney General for such action as the Attorney General may deem appropriate. 

The Biotechnology Industry Organization (BIO) released the following comment on the Goodlatte amendment:

The supplemental examination provision as passed by the Senate and originally included in the House bill would allow patent holders to seek a review of their issued patents at their own risk.  The Goodlatte amendment undercuts this provision by creating disincentives for patent owners to use the new procedure by having the U.S. Patent and Trademark Office (PTO) act as quasi-investigative body.

Since disbanding the “fraud squad” years back, the Office has not proactively pursued inequitable conduct issues, that is, aside from the few cases presented to OED by the public, or that result from final court determinations. The USPTO has made clear that the agency is ill suited to pursue investigations into inequitable conduct due to a lack of resources, subpoena power, etc.

It seems that the rationale behind the Goodlatte amendment is to ensure that supplemetal examination is not abused as a “get out of jail free” card by the unscrupulous—yet, such cases are the rare exception (despite the plague of inequitable conduct charges to the contrary in almost every patent litigation). The added provision would arguably require the Director to investigate every request for the sake of rooting out the rare exception. This duty would potentially turn every request into a witch hunt—no thank you.

Patent Community Awaits Crucial DecisionYesterday, the Supreme Court heard arguments in Microsoft v. i4i . As discussed at length previously, Microsoft has sought Supreme Court review of the following issue:Whether the court of appeals erred in holding that Microsoft’s invalidity defense (which rested on prior art never considered by the USPTO) must be proved by clear and convincing evidence. You can find a transcript of yesterday’s hearing (here). As expected, patent reexamination was discussed as evidence of Congressional acquiescence with respect to the clear and convincing standard—the proposed patent reform legislation was even mentioned. As usual the court was more interested in policy debates than anything else, and made it clear that some of the solutions proposed in the amicus briefing were unworkable. ….and now we wa

Yesterday, the Supreme Court heard arguments in Microsoft v. i4i . As discussed at length previously, Microsoft has sought Supreme Court review of the following issue:

Whether the court of appeals erred in holding that Microsoft’s invalidity defense (which rested on prior art never considered by the USPTO) must be proved by clear and convincing evidence.

You can find a transcript of yesterday’s hearing (here). As expected, patent reexamination was discussed as evidence of Congressional acquiescence with respect to the clear and convincing standard—the proposed patent reform legislation was even mentioned. 

As usual the court was more interested in policy debates than anything else, and made it clear that some of the solutions proposed in the amicus briefing were unworkable. ….and now we wait.

How Likely Is It to Recover At least 1 Original Claim?  One of the factors considered by district court judges in deciding whether to stay a case pending patent reexamination is the likelihood that the proceeding will simplify issues for trial. Typically, litigants will cite to published USPTO reexamination statistics in the hopes of persuading the court that simplification will/will not result.For example, recent ex parte reexamination statistics indicate that all claims are confirmed in 23% of cases, all claims cancelled in 12% of cases, and some claims amended in 65% of cases. As such, defendants will argue that in 77% of cases there are claim changes (cancellation + amendment). On the other hand, plaintiffs will take the other extreme and emphasize the 12% of cases in which all claims are cancelled– reasoning that there is a very low likelihood that the case will be completely disposed of via patent reexamination. However, in deciding whether or not stay a district court litigation pending patent reexamination, perhaps a more helpful statistic to courts would be the % of cases concluding with at least 1 confirmed claim.Since the USPTO does not provide such statistics, I have compiled them for the last 12 months (Feb. 2010 – Feb. 2011). As shown below, I have broken out ex parte and inter partes cases separately. Confirmed claims were those claims that were actively reexamined and indicated as confirmed in the reexamination certificate, or claims amended to include dependent claims only. The charts below represent the 807 certificates printed from February 2010 – February 2011.Ex Parte Patent Reexamination 59% of Cases Have 1 Claim ConfirmedInter Partes Patent Reexamination 41% of Cases Have 1 Claim ConfirmedThese survival rates demonstrate that there is much more to the story than the all-or-nothing USPTO statistics, and the combined cancellation/amendment figures of defendan

One of the factors considered by district court judges in deciding whether to stay a case pending patent reexamination is the likelihood that the proceeding will simplify issues for trial. Typically, litigants will cite to published USPTO reexamination statistics in the hopes of persuading the court that simplification will/will not result.

For example, recent ex parte reexamination statistics indicate that all claims are confirmed in 23% of cases, all claims cancelled in 12% of cases, and some claims amended in 65% of cases. As such, defendants will argue that in 77% of cases there are claim changes (cancellation + amendment). On the other hand, plaintiffs will take the other extreme and emphasize the 12% of cases in which all claims are cancelled– reasoning that there is a very low likelihood that the case will be completely disposed of via patent reexamination. However, in deciding whether or not stay a district court litigation pending patent reexamination, perhaps a more helpful statistic to courts would be the % of cases concluding with at least 1 confirmed claim.

Since the USPTO does not provide such statistics, I have compiled them for the last 12 months (Feb. 2010 – Feb. 2011).  As shown below, I have broken out ex parte and inter partes cases separately. Confirmed claims were those claims that were actively reexamined and indicated as confirmed in the reexamination certificate, or claims amended to include dependent claims only. The charts below represent the 807 certificates printed from February 2010 – February 2011.

Ex Parte Patent Reexamination 59% of Cases Have 1 Claim Confirmed

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Inter Partes Patent Reexamination 41% of Cases Have 1 Claim Confirmed

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These survival rates demonstrate that there is much more to the story than the all-or-nothing USPTO statistics, and the combined cancellation/amendment figures of defendants.