2020: POP Precedents & Director Driven Changes
In 2020, the Board continued to expand 314(a) discretion through numerous Precedential Opinion Panel (POP) decisions. These decisions, among a number of other developments, demonstrated a clear interest on the part of the current Director to rebalance AIA trial proceedings in the direction of patent owners. At the same time, the agency experienced increasing push back from larger innovator organizations — often subject to frivolous patent litigation— to rein in discretionary practices as it relates to favorite NPE venues. Rule packages attempting to codify 314(a) practices in a manner that would conform with the Administrative Procedure Act (APA) were killed, and lawsuits challenging the agency 314(a) practices were filed. In the background (as seems to occur every year) a constitutional challenge to the PTAB’s very existence made its way to the SCOTUS.
Another exciting PTAB year in the books. But before closing the books on 2020, here are my Top 5 PTAB decisions/developments that changed the game for PTAB practitioners.
5. Use of Admitted Art – Director Memorandum
The USPTO issued a guidance memo on the use of Applicant Admitted Prior Art (AAPA) in IPR proceedings. Much like the agency’s earlier 101 Guidelines on Patent Subject Matter Eligibility, the AAPA Guidance is a pronouncement of the agency’s independent view of the law as opposed to more traditional implementation guidance on regulatory practices or new CAFC/SCOTUS jurisprudence.
The memo (here) concludes that that the basis for an inter partes review (IPR) must be a prior art patent or printed publication, and that statements regarding prior art in the challenged patent therefore cannot serve as the basis for instituting an IPR. But, such statements, may provide evidence of the general knowledge possessed by a person of ordinary skill in the art, and may be used to support an obviousness argument in conjunction with one or more prior art patents or printed publications.
So, AAPA can still be leveraged, just not as an actual prior art reference of a trial ground. My earlier post (here) questions the reasoning of this decision.
The Federal Circuit will likely get a chance to weigh in on this issue in 2021 as AAPA grounds previously accepted for trial make their way out of the agency.
4. RPI Determinations May be Unnecessary? – SharkNinja Operating LLC v. iRobot Corp., (here)
SharkNinja instituted trial in the face of an RPI dispute, explaining that, while petitioners must identify any real parties-in-interest, and must do so in good faith, the Board does not need to resolve a dispute regarding a possible real party-in-interest if it would not impact the Board’s institution decision (i.e., there is no 315(b) time bar involving the disputed, unnamed party). While this decision may not jump out as especially noteworthy, given the extent to which RPI issues have been litigated at the PTAB over the years, this will simplify a fair number of preliminary proceedings – especially those involving member organizations.
3. Petitioner Presumption Eliminated – Final Rule Package
As of next Monday, January 11th, the Final Rule Package of December 2020 goes into effect. This final rule will eliminate the presumption accorded to petitioner testimonial evidence during the preliminary proceeding (when disputed by patent owner testimonial evidence to the contrary). That is, where there is a direct evidentiary dispute, the new rule will eliminate the previous practice of favoring petitioner evidence for purposes of institution.
Looking forward into 2021, this change may encourage more Patent Owners to file testimonial evidence, but that is not my expectation (see earlier post (here)
2. 325(d) Framework – Advanced Bionics, LLC v. MED-EL Elektromedizinische Geräte GmbH (here)
325(d) issues are raised in the vast majority of preliminary proceedings. That is, is the prior art submitted with the petition something the agency has seen before?
Advanced Bionics explains that the Board applies a two-part framework for exercising discretion under § 325(d) to deny a petition on this basis. The framework is as follows:
(1) Whether the same or substantially the same art previously was presented to the Office or whether the same or substantially the same arguments previously were presented to the Office; and
(2) If either condition of first part of the framework is satisfied, whether the petitioner has demonstrated that the Office erred in a manner material to the patentability of challenged claims.
Given the frequent debate of this issue in preliminary proceedings, the framework brought some much needed consistency to this analysis – especially as it relates to error of the Office.
1. 314(a) Framework – Apple Inc. v. Fintiv, Inc
It is hard to argue that there was a more impactful development coming out of the PTAB in 2020 than Fintiv. The “Fintiv Factors” are analyzed in just about every case that has a parallel litigation.
The Board designated as precedential the supplemental briefing order in Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (March 20, 2020), which lists six factors to be assessed in such scenarios. The precedential Order (here) lays out six factors (Fintiv factors) that the Board considers in determining whether to exercise its discretion to institute review when there is a related proceeding pending in district court, these factors are:
1. Whether the court granted a stay or evidence exists that one may be granted if a proceeding is instituted;
2. Proximity of the court’s trial date to the Board’s projected statutory deadline for a final written decision;
3. Investment in the parallel proceeding by the court and the parties;
4. Overlap between issues raised in the petition and in the parallel proceeding;
5. Whether the petitioner and the defendant in the parallel proceeding are the same party; and
6. Other circumstances that impact the Board’s exercise of discretion, including the merits.
Since the Fintiv decision the PTAB has layered on numerous other decisions that are meant to elucidate agency practices when assessing the above factors.
Well, that closes out my 5 most noteworthy developments for PTAB practitioners in 2020.
In my next post, I will cover the top 5 PTAB-related developments for district court litigators.