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Inter Partes Review by the Numbers: Data Analytics to Identify Hot Spots in Obviousness Challenges.

Byline: Jonathan Harris, Saira Haider, Ricky Camposanto

Petitioners in inter partes review proceedings before the Patent Trial and Appeal Board almost invariably invoke obviousness as a ground of unpatentability. This article calculates the percentage of time the board has relied upon the various bases for nonobviousness across nearly 400 decisions, written through Sept. 30, in the interest of optimizing the likelihood of success for petitioners and patent owners alike. The article also calculates the percentage of time each board judge with more than 15 petition decisions has found obviousness as opposed to nonobviousness.

Based on the cases and data, three key trends emerge:

-- The single biggest ground invoked by the board in denying institution of trial and supporting final written decisions of nonobviousness is the absence of limitations recited by the claims.

-- Running a close second to missing limitations as a basis for nonobviousness findings at both the petition and trial stage is the rationale for modifying or combining references. This is true notwithstanding the flexibility afforded by the U.S. Supreme Court's decision in KSR v. Teleflex, 550 U.S. 398 (2007), and the Patent Office's KSR guidelines.

--Third, while not tied to the data, there is a growing trend toward denial of petitions based on technical deficiencies.

The standard for obviousness is well-settled. In conjunction with the so-called Graham factors, a party urging obviousness must show some teaching or suggestion of each and every claim limitation recited by the claims; a rationale for modification or combination; a reasonable expectation of success; and that secondary considerations do not overcome obviousness.

Based on an analysis of 391 nonobviousness decisions by the board (307 petitions and 84 trials), the following table calculates the percentage of time the board relied upon a failure to satisfy each of the above-mentioned legal elements in support of its findings.

Because many cases supported nonobviousness findings by pointing to more than one of these bases, the totals exceed 100 percent.

We turn now to the three key trends mentioned at the outset.

Missing Limitations: In nearly 90 percent of nonobviousness decisions at the petition level and 66 percent of nonobviousness decisions at the trial level, the board found that claim limitations recited by patents under review were missing from the prior art. In some cases, the analysis hinged on claim construction. In others, petitioners relied primarily on anticipation and failed to adequately support back-up obviousness positions with secondary teachings.

Accordingly, patent owners and their experts should closely analyze proposed combinations of prior art references for missing limitations. The data suggest patentees should err on the side of over-inclusion. Furthermore, patentees should seek broadest reasonable interpretations that exclude limitations, but only to the extent such interpretations do not conflict with infringement positions in contemplated or co-pending litigation.

For their part, petitioners relying on obviousness must double-check prior art references to ensure that all claim limitations recited by the claims are satisfied. Petitioners should not assume a particular interpretation will control, and should consider whether to assert that the prior art covers other plausible interpretations of the claim language. See Superior Comm'ns. Inc. v. Speculative Product Design LLC, IPR2013-00626, Paper No. 18, Decision at 5-6, 10 (PTAB March 18, 2014). Petitioners should also be especially mindful of providing some teaching or suggestion for each and every claim limitation when advancing obviousness as a back-up to anticipation. See Amkor Tech. Inc. v. Tessera, Inc., IPR2013-00242, Paper No. 132, Decision at 13 (PTAB Oct. 10, 2014).

Rationales: According to one former board judge, "The key to the proceeding is almost always the rationale to combine the references." See Law360's AIA Survival Guide: Preparing An Airtight Petition (Sept. 8, 2015) by Ryan David. Although KSR expanded the list of available rationales, the sufficiency of those rationales played a factor in a significant percentage of nonobviousness findings--about 58 percent at the petition stage and 64 percent at the trial stage. Patentees should pay close attention to which rationale a petitioner selects. Outside of teaching/suggestion/motivation, certain rationales may require affirmative proof of predictability. See M.P.E.P. 2143. Patentees may try to seize upon this additional requirement by pointing out the unpredictability of the art generally, and the unpredictability of the precise combination in achieving the intended purpose of the claimed invention. See Mylan Pharm. Inc. v. Gilead Sci. Inc., IPR2014-00888, Paper No. 15, Decision at 15-16 (PTAB Dec. 9, 2014). Evidence that there are multiple ways one of ordinary skill could make wrong turns and not arrive at the claimed subject matter can be persuasive.

Along these same lines, petitioners should think strategically about which rationale to select and take care to avoid conclusory assertions devoid of underlying facts and evidence to support their rationales. To the extent the teaching/suggestion/motivation rationale is available, petitioners may wish to focus their efforts there. Conclusory assertions concerning the rationale to modify or combine are, of course, not advisable. See Ariosa Diagnostics, Petitioner, v. Verinata Health Inc., Patent Owner, IPR2013-00276, Paper No. 43, Decision at 16-17 (PTAB Oct. 23, 2014).

Technical Defects at the Petition Stage

Another important trend is the board's increasing reliance on technical defects in petitions to deny institution of trial. Because petitioners are filing inter partes reviews at a record pace, the board has grown increasingly less forgiving and more likely to bounce petitions for failure to comply with technical requirements.

For example, petitioners must conclusively establish that references qualify as prior art based on their effective filing or publication dates. In Marvell Semiconductor Inc. v. Intellectual Ventures I LLC, IPR2014-00547, Paper No. 19, Decision at 3-5 (PTAB Jan. 14, 2015), the board denied the petition because the petitioner failed to establish that the asserted reference was prior art under 35 U.S.C. 102(e) before the earliest effective filing date of the challenged patent. In particular, the petitioner failed to provide a copy of the provisional application as an exhibit and failed to cite supporting disclosure from the provisional specification. Id.

Two additional technical defects that appear with some frequency relate to real party in-interest and presentation of the same or substantially similar arguments. In Amazon.com Inc. v. Appistry Inc., IPR2015-00480, Paper No. 18, Decision at 3-6 (PTAB July 13, 2015), the board denied a petition because the petitioner failed to adequately disclose the real parties-in-interest. In Ford Motor Co. v. Paice LLC, IPR2015-00767, Paper No. 14, Decision at 5-7 (PTAB Aug. 18, 2015), the board invoked 35 U.S.C. 325(d) to deny petitions that relied upon grounds that were substantially similar to grounds raised in earlier petitions.

Data on Judges in Petitions and Trials

While past performance is no guarantee of future results, it is also instructive to look at trends in obviousness decisions issued by particular board judges. The following table identifies the number of times judges issuing more than 15 petition decisions have found obviousness versus non-obviousness.

Because the inter partes review procedure is only about three years old, the number of post-trial decisions is significantly lower than decisions at the petition stage. It is, however, likely that trends appearing at the petition stage reveal the leanings of individual judges at trial. Of course, to gain the most valuable insights, petitioners and patent owners should review the content of opinions written by members of panels assigned to their cases.

There is no one-size-fits-all approach to patent obviousness in the inter partes review arena. Nonetheless, companies involved in these proceedings can increase their chances of success at the board by focusing on trends emerging in recent decisions.
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Publication:Inside Counsel Breaking News
Date:Apr 8, 2016
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