Evolving PTAB Trial Practice: Navigating Complex Procedural Rules

Transcription

1 Presenting a live 90-minute webinar with interactive Q&A Evolving PTAB Trial Practice: Navigating Complex Procedural Rules Strategically Using Routine and Additional Discovery, Requests for Joinder, and Motions to Amend THURSDAY, MAY 25, pm Eastern 12pm Central 11am Mountain 10am Pacific Today s faculty features: Kevin B. Laurence, Partner, Laurence & Phillips, Alexandria, Va. Scott A. McKeown, Partner, Oblon McClelland Maier & Neustadt, Alexandria, Va. The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions ed to registrants for additional information. If you have any questions, please contact Customer Service at ext. 10.

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4 Evolution of PTAB Trial Practice SCOTT MCKEOWN KEVIN LAURENCE

5 "Trial" Not Really -Administrative Trial -Limited access to APJs -Drastically different than D.Ct -Fact Finders -Credibility -Storytelling -Arguments K40 Electronics, LLC v. Escort, Inc., (IPR ) 5

6 Petition Practice Pick your poison: CBM is not the bargain it once was Unwired Planet/Alice Estoppel watered down in IPR Watch PGR window 102 is not your friend Don't let litigation drive strategy, it will backfire 103 is your friend Understand Dynamic Drinkware Date Your Pubs 6

7 Petition Practice Coming Changes? SAS Institute Inc., v. ComplemenSoft LLC. Change nobody wants Petitioners downsides Greater estoppel No more hiding behind Shaw No more redundancy Institution Decisions less valuable Would Force a Markman style hearing = $$$ Fewer settlements 7

8 Petition Practice Coming Changes? SAS Institute Inc., v. ComplemenSoft LLC. Patentee downside Stays become far more attractive Patents tied up for 2-3 years through CAFC What's the point in a preliminary response Need to win all claims Additional prosecution history Additional $$$ What happens to current cases? 8

9 Petition Practice Coming Changes? WiFi One..beware indemnity, JDG Discovery could become more lax, PGR/CBM Construe claim terms necessary for art 35 USC 301(a)(2) Tell PTAB what is going on in real world Consider multiple.even alternative filings Declarations should tell the story, not repeat petition Anticipate counter arguments! 9

10 Preliminary Response New Patentee Evidence (Prelim. Resp.) Benefit or just more expense? Petitioner Reply? Rare so far What issues are best raised Downside? Is it helping patentees? 10

11 Preliminary Response Evidence (Early Stats) 11

12 Preliminary Response Evidence Impact Limited upside in unpredictable arts Fewer issues, experts battle Predictable arts Focus on new attacks New claim term Operating principle Existing solution Motivation deficiencies 12

13 Preliminary Response Evidence Impact Do not argue everything Creates deposition inventory Contested facts construed in favor of petitioner Lengthier declarations more likely to be ignored Board is looking for "easy out" Don't make it look complicated Petitioners Anticipate issues "Statement of Facts" section in petition? Mixed Bag to date learning curve? 13

14 Institution Rehearing Petitioners: Nothing to lose, but almost zero chance Patentee: More harm than good Scheduling Order Get on Discovery (earlier if possible) Move Oral Arg. immediately or forget it Be flexible!! 14

15 PTAB s Discretion to Institute Follow-on Petition under 325(d) When determining whether to institute a review based on a follow-on petition, the PTAB has discretion under 35 U.S.C. 325(d) to consider whether substantially the same prior art or arguments previously were presented in a prior petition. Even if the petitioner has established that a RLP exists, institution of IPR is discretionary under 35 U.S.C. 314(a). Conopco v. Unilever, IPR , Paper 23 (Mar. 20, 2015) ( Reasonable inference that new prior art references raised in second petition... were known to [petitioner] when it filed first petition. ) Travelocity v. Cronos Techs., IPR , Paper 7 (June 15, 2015) (same for PGR & CBM under 35 U.S.C. 324(a)). 15

16 PTAB s Discretion to Institute Follow-on Petition under 325(d) 3 rd time isn t a charm when same or substantially the same prior art or arguments are presented Medtronic v. NuVasive, IPR , Paper 8 (Sept. 11, 2014). Can t even count on a 2 nd bite at the apple: Using decisions as a roadmap in serial petitions to correct deficiencies would tax PTAB resources. Conopco v. Unilever, IPR , Paper 25 (Dec. 10, 2014). But see Valeo v. Magna, IPR , Paper 10 (Dec. 23, 2014), which involved different combinations. 16

17 To Avoid Denial of Follow-on Petitions Do not characterize serial petition as correcting a deficiency in a previous filing to avoid assertions of harassment. Butamax v. Gevo, IPR , 12 Paper 8 (Oct. 14, 2014) It may be helpful to provide search strategy and results used in first petition and explain why art available at the time of the original petition was omitted. Butamax v. Gevo; but see Square v. Unwired Planet, CBM , Paper 14 (Dec. 28, 2015) Reasonable inference that new prior art references raised in second petition... were known to [petitioner] when it filed first petition. ). Conopco v. Unilever, IPR , Paper 23 (Mar. 20, 2015) 17

18 PTAB s Criticisms in Decisions Not to Institute Follow-on Petitions Claim construction could have been offered in 1 st petition and same art asserted (with respect to different claims). Jiawei Tech. v. Richmond, IPR , Paper 22 (May 1, 2015). Additional justification is needed when teachings based on different ground are essentially the same as those in earlier ground. Intelligent Bio-Systems v. Illumina, Paper 19 (Nov. 21, 2013) Petitioner s comment in 1 st petition that 103 references individually render claims unpatentable doomed 102 ground in 2 nd petition based on one of the same references. Similarly, assertion of indefiniteness was blocked by comment in 1 st petition criticizing sufficiency of disclosure of claim term. Travelocity v. Cronos, CBM , Paper 7 (June 15, 2015). 18

19 PTAB s Discretion to Institute Under 35 U.S.C. 314(a) Even if the petitioner has established that a RLP exists, institution of IPR is discretionary under 35 U.S.C. 314(a). Conopco v. Unilever, IPR , Paper 23 (Mar. 20, 2015) (35 U.S.C. 314(a) provides that the Board may, but not must, initiate an inter partes review when a petitioner demonstrates a reasonable likelihood of prevailing at trial with respect to at least one challenged patent claim. ) Travelocity v. Cronos, IPR , Paper 7 (June 15, 2015) (same for PGR & CBM under 35 U.S.C. 324(a)). 19

20 Multiple Reviews and Joinder If review has been instituted, PTAB has discretion to join to it another review of the same type for the same patent. e.g., IPR ; IPR ,-901,-949,-976, and IPR Motion for joinder due 1 mo. from institution. Joinder is exception to one-year bar for IPR. Mandamus petition at Federal Circuit challenged this. In re VirnetX (filed Mar. 4, 2016, denied Mar. 18, 2016). Issue can be raised in appeal of FWD. PTAB will decide joinder after receiving a preliminary response to 2 nd IPR petition or the expiration of the time for filing the same and after deciding to institute trial based on a 2 nd IPR petition. 20

21 Supplemental Information A party may file motion to submit supplemental info. Criteria Motion must be filed within one month of institution. Suppl. info. must be relevant to claim involved in trial. Consideration of additional criteria beyond timing and relevance not precluded. Redline Detection, LLC v. Star Envirotech, Inc., 811 F.3d 435 (Fed. Cir. 2015) (reviewed on appeal for abuse of discretion) Submitting suppl. info. after deadline or not relevant to contested claim requires showing that the suppl. info. could not have been reasonably obtained earlier. 21

22 Supplemental Information Examples Examples of Suppl. Info. Permitted Evidence of public accessibility of reference Evidence to authenticate document Decl. attesting to accuracy of translation Examples of Suppl. Info. Denied Decl. re. meaning of claim term Additional prior art references EPO decision re. European counterpart to patent in trial Prior art reference & expert declaration filed with another IPR petition against the same patent (after the 1-month deadline) 22

23 Supplemental Information Supplemental Evidence Difference between suppl. information and evidence is: [S]upplemental evidence served in response to an evidentiary objection and filed in response to a motion to exclude is offered solely to support admissibility of the originally filed evidence and to defeat a motion to exclude that evidence, and not to support any argument on the merits (i.e., regarding the patentability or unpatentability of a claim). Supplemental information, on the other hand, is evidence a party intends to support an argument on the merits. Handi-Quilter, Inc. v. Bernina Int l AG, IPR , Paper 30 at 3 at 6 (June 12, 2014) 23

24 Trail Practice - Motions Objections to Evidence Motions to Exclude 9 out of 10 fail! A handful of judges receptive CAFC unlikely to help you given standard of review Really an just invitation for more evidence Most just go to weight to Judges for motion authorization 24

25 Routine Discovery -Cross Examination- Depositions Understand this is essentially live testimony Redirect far more important Daubert, Skill in the Art.not likely Do you really need to take it? No speaking objections Calls to judges far more routine No video absent agreement Transcript goes into record 25

26 Patentee Trial Response Speak to issues not themes Claims, scope of art, teachings, etc. Attacking references individually will not work Forget Markman, or previous wins Provide a reason for narrow claim read Amend?...Aqua Products unlikely to help. Markman amend (Convolve v. Dell) Settle? 26

27 Petitioner Reply Genzyme mana from heaven New evidence during trial expected But must support ground, not change it Rebut only what is necessary Resist temptation to go tit-for-tat Supplemental declaration only where necessary. Tone it down 27

28 Post-Briefing Observations Downside of reply declaration Motions to Exclude Waste of money in most cases Oral Hearing Demonstratives?? 28

29 Oral Argument Your mileage may vary Panel dependent Dynamics of remote judges/demonstratives Objections (not usually) Petitioner 2 shots Patentee 1 Court Reporter SAS Institute Create a record 29

30 FWD/CAFC Rehearing odds increase But beware making matters worse Need delay? Appeal De novo, substantial evidence, abuse of discretion Solicitor to Intervene? 30

31 Petitioner Estoppel at PTO If a party litigates an IPR, PGR, or CBM to FWD, then that party is estopped under 35 U.S.C. 315(e)(1) or 35 U.S.C. 325(e)(1) from challenging any claim that was challenged (in trial) in a follow-on IPR, PGR, CBM, or a reexamination. Dell v. ETRI, IPR , Paper 10 (Mar. 26, 2015) (denying subsequent petition because petitioner lost first trial, resulting in FWD, which estopped the petitioner per 35 U.S.C. 315(e)(1) as to some of the claims challenged in the subsequent petition). Square v. Unwired Planet, CBM , Paper 14 (Dec. 28, 2015) (petitioner estoppel applies to a follow-on CBM under 35 U.S.C. 325(e)(1)) 31

32 Example of Estoppel from Review Proceeding Square v. Unwired Planet, CBM , Paper 14 (Dec. 23, 2015) The petitioner commissioned searches by three reputable search firms, filed a CBM petition, discovered a new reference (U.S. patent), and filed a follow-on petition citing the new reference The Board held it was not enough to simply fail to discover a prior art before the first filing as the estoppel is not avoided unless the reference could not have been discovered earlier and raised. 32

33 Petitioner Estoppel in Litigation Scope for IPR, PGR, CBM at PTO and for IPR and PGR in litigation: Grounds raised or reasonably could have raised under 35 U.S.C. 315(e)(2) or 35 U.S.C. 325(e)(2) Excludes challenge not instituted as redundant. Shaw v. Automated Creel Sys., 817 F.3d 1293 (Fed. Cir. 2016). Lack of awareness of reference alone is not enough to avoid estoppel; need explanation. Square v. Unwired Planet, CBM , Paper 14 (Dec. 23, 2015 Scope for CBM in litigation: Grounds raised 33

34 Example of Estoppel from Litigation Star Envirotech v. Redline Detection, No. SACV (C.D. Cal. Jan. 29, 2015) Defendant was IPR petitioner There was a prior art manual for a prior art device PO sought to strike invalidity contentions relying on actual device due to estoppel based on manual s availability in IPR Holding: Invalidity contention not struck. Rationale: The actual device had features not described in the manual. 34

35 Petitioner Estoppel cont d Forums in which estoppel applies: Proceeding before the PTO (including reexamination) Civil action under 28 U.S.C ITC proceeding Trigger: Board s Final Written Decision (not after all appeals like IPX) Doesn t matter whether FWD is favorable or unfavorable Estoppel does not bar subsequent petitions on non-instituted claims. Westlake v. Credit Acceptance, CBM , Paper 28 (May 14, 2015) Estopped parties: Petitioner, real parties in interest, privies of the petitioner 35

36 Future of Petitioner Estoppel Shaw - no estoppel for a ground that was not part of the trial because 315(e) limits the effect of estoppel to any ground that the petitioner raised or reasonably could have during that inter partes review. Judge Robinson of the District of Delaware teed up a challenge to the logic in Shaw by permitting Toshiba to assert invalidity challenges that could have been raised in its IPR. Judge Robinson stated that extending the logic of Shaw to prior art references that were never presented to the PTAB at all (despite their public nature) confounds the very purpose of this parallel administrative proceeding, but could not divine a reasoned way around the Federal Circuit s interpretation in Shaw. Intellectual Ventures I LLC et al. v. Toshiba Corp. et al., Civ. No SLR (D. Del. Dec. 19, 2016) Possible solution: institute on all grounds if RLP or MLTN threshold is met for one claim such that estoppel applies to all grounds. 36

37 Future of Petitioner Estoppel Did EDTX just figure this all out? Biscotti Inv. V. Microsoft Corp., Civ. No (E.D. Tex.) Narrow view of Shaw, Microsoft is estopped from asserting at trial: 1) Grounds for which the PTAB instituted IPR and determined to be insufficient to establish unpatentability after a trial on the merits; 2) Grounds included in the petition but determined by the PTAB to not establish a reasonable likelihood of unpatentability; 3) Grounds not included in the petition that a skilled searcher conducting a diligent search reasonably could have been expected to discover; and 4) Any subsets of invalidity grounds that Microsoft raised or could have raised during the IPR. 37

38 Conclusions Understand your audience Changes Ahead SAS will create a mess Don t treat like district court Some mechanisms can backfire Questions? 38

39 THANK YOU CONTACT: SCOTT MCKEOWN KEVIN LAURENCE