The Limited Ability of a Patent Owner to Amend Claims and Present New Claims in Post-Grant and Inter Partes Reviews By: Lawrence Stahl and Donald Heckenberg The Leahy-Smith America Invents Act (AIA) includes two new post-grant proceedings for challenging the validity of a patent: post-grant review and inter partes review. These new review proceedings will differ from the current inter partes reexamination proceeding in many aspects. One significant difference between the new inter partes and post-grant reviews and inter partes reexamination will be the extent to which the patent owner is able to present amended or new claims during the course of the proceedings. While the current inter partes reexamination rules give a patent owner a broad right to present amended and/or new claims, the ability to present amended and new claims in post-grant and inter partes reviews will be significantly more restricted. The United States Patent and Trademark Office (USPTO) recently published notices of proposed rulemaking to implement the AIA. The notices set forth the USPTO s proposed rules governing post-grant and inter partes reviews, including with respect to amendment practice in the proceedings. 1 The USPTO has also published a Practice Guide for Proposed Trial Rules, which further discusses the proposed rules and procedures that will be used in the review proceedings. 2 While the final rules issued by the USPTO may deviate in some respects from the proposed rules, the USPTO has made clear in the rulemaking notices that it intends to take a restrictive direction with respect to amendments in review proceedings. The more restrictive amendment procedures in the post-grant and inter partes review proceedings, coupled with the quick time frames in which the review proceedings will be concluded, will significantly reduce the strategies available to patent owners and, as a result, limit potential pitfalls for third-parties initiating such proceedings. Amendments in Post-Grant and Inter Partes Reviews Inter partes reexamination gives a patent owner a broad right to amend and add patent claims during the course of the reexamination. Under the inter partes reexamination statutes and rules, the patent owner is permitted to propose any number of amended or new claims, with the only restriction being that the scope of amended or new claims 1 77 Fed. Reg. 7041-80 (Feb. 10, 2012). 2 Id. at 6868-79.
could not broaden the originally-patented claims. 3 Thus, a patent owner is, for all intents and purposes, free to add an unlimited number of more narrow claims to the patent. Further, the patent owner is free to present a large number of amendments or new claims in response to any non-final office action. Thus, in an inter partes reexamination, a patent owner might have multiple opportunities to present amended or new claims, if multiple non-final office actions issued during the course of the reexamination. Unlike inter partes reexaminations, a patent owner in a post-grant review or inter partes review will not have a broad right to present amended or new claims. The AIA limits the timing and number of amended or new claims that a patent owner may introduce during the course of a review proceeding. To begin with, the AIA only provides the patent owner with the right to file one motion presenting amended or new claims during a review proceeding. 4 Any additional motion to amend claims or present new claims will be allowed only upon the joint request of the third-party petitioner and the patent owner to materially advance the settlement of the proceeding, or as permitted by regulations prescribed by the Director. 5 Thus, in most cases the patent owner will have only one bite at the apple. The USPTO s proposed rules and accompanying commentary point out that a patent owner likely will be allowed to file only one motion presenting amended or new claims, as the availability of a second motion will be limited. The USPTO indicates that additional motions to amend will be allowed only upon a joint agreement between the petitioner and patent owner, or upon a demonstration of good cause by the patent owner. 6 In evaluating whether the patent owner has shown good cause so as to permit an additional motion to amend, the USPTO will take into account the timing of the submission, with the USPTO commenting that it will look unfavorably on an additional motion to amend late in the proceeding since later-filed amendments will likely impair the petitioner s ability to mount a full case. 7 Given the expedited nature of the new review proceedings (discussed below), it appears that a patent owner may have difficulty convincing the USPTO that an additional motion to amend can be allowed without impairing the petitioner s case. The AIA also limits the number of claims that are permitted to be amended in an inter partes or post-grant review. A patent owner may only amend those claims that are challenged in the review, or propose a reasonable number of substitute claims for each challenged claim. 8 There are no analogous restrictions to amendments in inter partes 3 Pre-AIA 35 U.S.C. 314. 4 35 U.S.C. 316(d)(1), 326(d)(1). 5 35 U.S.C. 316(d)(2), 326(d)(2). 6 77 Fed. Reg. at 7046-47. 7 Id. 8 35 U.S.C. 316(d)(1), 326(d)(1). 2
reexaminations. Thus, it appears that a patent owner will no longer be able to add claims at will. As with inter partes reexamination, the AIA limits the scope of claims that a patent owner may pursue in a review proceeding. Specifically, a patent owner cannot enlarge the scope of the claims of a patent with an amendment or new claims in a post-grant or inter partes review. 9 The USPTO s proposed rules further restrict amendment practice in the new review proceedings. The proposed rules provide that a motion to amend the claims will not be authorized where the amendment does not respond to a ground of patentability involved in the post-grant or inter partes review. 10 The commentary accompanying the proposed rules also states that the number of substitute claims must be reasonable, with there being a general presumption that it is reasonable to have only one substitute claim to replace each challenged claim. 11 Inter partes reexamination rules do not include such restrictions on the nature and number of new claims that could be presented during the reexamination proceeding. The Timing of Amendments The AIA mandates that the USPTO reach a final determination in a post-grant or inter partes review within twelve months from the date that the USPTO initiates the review proceeding. 12 As part of the published practice guide for the new review proceedings, the USPTO has provided the following timeline to illustrate example due dates for actions by parties that will be necessitated by the requirement that a proceeding be completed in twelve months. 13 9 35 U.S.C. 316(d)(3), 326(d)(3). 10 Proposed 37 C.F.R. 42.121(c)(1), 42.221(c)(1). 11 77 Fed. Reg. at 6875. 12 35 U.S.C. 316,(a)(11), 326(a)(11). 13 The actual due dates for a given proceeding will be set by a scheduling order issued by the Board at the outset of the proceeding. See 77 Fed. Reg. at 6869. 3
The USPTO s exemplary schedule suggests that the patent owner file any motion to amend the patent claims within nine months of the date that the third-party files the petition to institute the proceeding, and within four months of the institution of the proceeding. This quick due date for a motion to amend the patent will have implications for both the third-party and the patent owner. As discussed above, from the perspective of a third-party a drawback of an inter partes reexamination is the broad ability of a patent owner to submit amended and new claims during the proceeding. This broad right, coupled with the less certain time frame within which the reexamination proceeding concludes, means that a third-party remains uncertain of the final claims that might result from the reexamination proceeding for an indefinite period of time. 14 On the other hand, with the greatly limited nature of amendments that a patent owner may file in a post-grant or inter partes review, and with the limited time frame in which the patent owner may file an amendment, a third-party will have a more certain idea of the claims that might result from the proceeding at a much sooner time. In some cases, a third-party might be able to take advantage of the more narrow scope of amendments and limited time frame for filing amendments in the new review proceedings. For example, the third-party may contemplate instituting a post-grant or inter partes review for a patent in conjunction with considering redesigns of its products that avoid infringing the claims of the patent. While attempting to cancel the original claims of the patent, the third-party might develop the design of their product in light of how the review is progressing. In some cases, it might even be possible for the thirdparty to delay the release of the new design until after the time frame that the patent 14 The average pendency of an inter partes reexamination proceeding is more than three years. See USPTO s Inter Partes Reexamination Data for the FY2012 Quarter ending 03/31/2012, available at http://www.uspto.gov/patents/stats/reexam_operational_statistics_fy12q2.pdf. 4
owner can file amended or new claims. At that time, the third-party can be reasonably confident of the possible scope of claims that may issue as a part of the patent after the review proceeding and reasonably confident that the patent owner will not be able to add further new claims specifically tailored to the new design. Intervening Rights After Amending Claims in the New Review Proceedings The AIA provides for intervening rights that arise with respect to amended and new claims that are introduced during the course of a post-grant or inter partes review. Any proposed amended or new claim determined to be patentable and incorporated into a patent following a post-grant or inter partes review will be subject to intervening rights, such that a third-party will not be liable for infringing the amended or new claim prior to the completion of the review proceeding. 15 Thus, in many cases, a patent owner will have a strong motivation to avoid amending the original claims in a post-grant or inter partes review proceeding. Intervening rights are, of course, also applicable to patent claims arising from an inter partes reexamination. 16 Under inter partes reexamination practice, however, a patent owner is free to maintain the original claims of the patent, while still presenting new claims as a hedge against ultimately losing the original claims at the end of the proceeding. Further, the patent owner in an inter partes reexamination is also free to specifically tailor additional new claims to directly read on the requester s or another competitor s products, which may have become known to the patent owner subsequent to the original grant of the patent. Thus, the patent owner can sometimes add many new claims to the patent that, while narrow in scope and difficult to invalidate on prior art grounds, would still be infringed by its competitors, all the while maintaining the original claims of the patent that would not be subject to intervening rights. In the new post-grant proceedings, however, the ability of a patent owner to present amended or new claims is greatly restricted. Based on the AIA and USPTO s proposed rules discussed above, it appears that a patent owner will only be able to present claims as substitutes for the original claims of the patent. Moreover, any amended or new claim will likely be limited by the USPTO s proposed rule that motions to amend be responsive to a ground of patentability involved in the post-grant or inter partes review. 17 These rules, in conjunction with the presumption that only one substitute claim will be allowed for each original claim, will greatly limit the options for a patent owner. Along these lines, the strategy of maintaining original patent claims while presenting a large number of new claims will be greatly curtailed in the new review proceedings. 15 35 U.S.C. 318(c), 328(c). 16 Pre-AIA 35 U.S.C. 316. 17 See n. 10, supra. 5
Patent Owner Strategies to Introduce New or Amended Claims In light of the restrictive statute and rules, a patent owner might attempt different strategies to introduce amended or new claims in a post-grant or inter partes review. Most patents include a few broad independent claims and several dependent claims. A patent owner wishing to introduce an amended or new claim, while maintaining the broadest claims of the patent, might file a motion to introduce substitute claims for dependent claims, but maintain the original independent claims of the patent. However, there may be problems with this approach. First, an amended or new claim can only be substituted for a claim actually challenged in the proceeding. 18 Thus, there may be a limited number of dependent claims that the patent owner can use as a basis for substitution. Second, the USPTO s proposed rule that an amendment respond to a ground of unpatentability involved in the trial might hinder the patent owner s ability to file substitutes for dependent claims without also filing a substitute for an independent claim. 19 In this regard, the scope and ramifications of the proposed rule that amendments be responsive to a ground of unpatentability are unclear at this time. A patent owner might attempt to use a reissue application to pursue new or amended claims in a patent that is subject to a post-grant or inter partes review. Unlike the new review proceedings, there are no restrictions with respect to the nature or number of claims that can be introduced by a patent owner in a reissue application. Another rule proposed by the USPTO, however, might prevent the patent owner from introducing amended or new claims in a reissue application for a patent that is also involved in a post-grant or inter partes review. The USPTO has proposed a rule that would preclude the owner of a patent that has undergone a review proceeding from obtaining in another proceeding a patent claim that could have been filed in response to any properly raised ground of unpatentability for a finally refused or cancelled claim. 20 It appears that such a rule could estop a patent owner who loses a claim in a post-grant or inter partes review from pursuing any other claims in a reissue application that could have been filed in the post-grant or inter partes review. 21 Given the expedited timeframes of post-grant and inter partes reviews, it is likely that such an estoppel would take effect before the completion of the reissue, even if the reissue application was filed soon after the initiation of the review proceeding. 18 35 U.S.C. 316(d)(1)(B), 326(d)(1)(B). 19 See n. 10, supra. 20 Proposed 37 C.F.R. 42.73(d)(3)(ii). 21 Intellectual property organizations have voiced a strong opposition to the potential estoppel arising from the USPTO s proposed rule. See Comments of the Committee Appointed by the ABA-IPL, AIPLA and IPO on the United States Patent and Trademark Office s Proposed Regulations Relating to Post-Grant Review, Inter Partes Review and the Transitional Program for Covered Business Method Patents Under the Leahy-Smith America Invents Act, available at http://www.ipo.org/am/template.cfm?section=search§ion=ipo_position_statements1&te mplate=/cm/contentdisplay.cfm&contentfileid=64836. 6