PTAB Allows Supplementation of Record with Evidence of Public Availability of Prior Art Reference
by Melissa R. Gibson, Rachel J. Elsby & Rubén H. Muñoz, Akin Gump
The Patent Trial and Appeal Board (“PTAB”) granted Petitioners RPX Corporation and Advanced Micro Device, Inc.’s unopposed motion to submit supplemental information pursuant to 37 C.F.R. § 42.123(a). Petitioners requested permission to file an IEEE Declaration that attested to the public availability and authenticity of one of the references which served as the basis for which trial was instituted.
In making its determination, the PTAB considered not only the explicit requirements of the regulation—i.e., (1) that the request for authorization to file the motion be made within one month of institution, and (2) that the supplemental information be relevant to a claim for which trial has been instituted—but also the Federal Circuit’s instruction that a “guiding principle” underlying any determination, including determinations on motions to supplement, is to “ensure efficient administration of the Office and the ability of the Office to complete [inter partes review] proceedings in a timely manner.” Redline Detection LLC v. Star Envirotech, Inc., 811 F.3d 435, 445 (Fed. Cir. 2015). The PTAB held that the Petitioners’ request to file a motion was timely made within one month of the institution decision and that the declaration was relevant because it pertained to the public availability and authenticity of one of the references that provided the bases for each of the instituted grounds in this proceeding. The PTAB noted that Petitioners requested the declaration from the IEEE before the filing of their petition, but did not receive the declaration until after the petition was filed. However, Petitioners promptly shared the declaration with the Patent Owner, so the Patent Owner was aware of the declaration before filing its Preliminary Response. The PTAB further held that, because the declaration was timely submitted and relevant to the proceeding, Petitioners’ motion comported with the guiding principle of efficiency.
RPX Corp. v. IYM Tech. LLC, IPR2017-01888, Paper 16 (PTAB May 14, 2018)
References Introduced During IPR Proceeding Not Necessarily New Evidence to Which Patent Owner Had No Opportunity to Respond
by Jason Weil, Matthew George Hartman & Rubén H. Muñoz, Akin Gump
On May 14, 2018, the Federal Circuit affirmed the Patent Trial and Appeal Board’s (the “Board”) Final Written Decision in an inter partes review (IPR) proceeding holding all claims of Anacor Pharmaceuticals, Inc.’s (“Anacor”) U.S. Patent No. 7,582,621 unpatentable for obviousness. The single claim addressed on appeal related to a method of using an oxaborole known as “tavaborole” to treat onchomycosis (a nail infection) caused by a dermatophyte. Dermatophytes are a type of fungus responsible for 90 percent of all cases of onchomycosis.
The IPR petition alleged that the claim would have been obvious in light of the combination of two references: Austin and Brehove. Austin teaches the use of oxaboroles as fungicides and discloses that tavaborole inhibits a variety of fungi, including C. albicans. Brehove teaches that use of similar types of compounds to treat onchomycosis and discloses the results of in vivo testing of two such compounds where a patient’s onchomycosis was successfully treated. The Board concluded that a person of ordinary skill in the art would have expected that tavaborole, which shares functional activity with the Brehove compounds against C. albicans, would also have functional activity against other fungi responsible for onchomycosis (like dermatophytes), and would have combined Austin with Brehove with a reasonable expectation of success.
In reaching its conclusion, the Board cited evidence from three additional articles: Nimura, Segal and Mertin. On appeal, Anacor argued that the Board improperly relied on Segal and Mertin, which was new evidence not cited in the petition and to which Anacor did not have an opportunity to respond. The Federal Circuit explained that there is “no blanket prohibition against the introduction of new evidence,” which is “to be expected” during an IPR proceeding, so long as the opposing party has notice and an opportunity to respond. Moreover, a petitioner may introduce new evidence in reply to the patent owner’s evidence, or to document “the knowledge that skilled artisans would bring to bear” in the analysis.
Here, Anacor had notice and several opportunities to respond to both references. Anacor spent three pages of its patent owner’s response discussing Segal. Mertin was the third article in a series of three. Anacor’s expert, Dr. Lane, relied on the first two Mertin articles in her declaration. When cross-examined about the third Mertin article, Dr. Lane admitted that she was familiar with it. The third Mertin article was used again at the deposition of another Anacor expert and was discussed extensively by Anacor at the hearing before the Board. The Federal Circuit concluded that “Anacor had ample notice of and an opportunity to respond to the Segal and Mertin references, which in any event were properly offered in reply to arguments made by Anacor and for the purpose of showing the state of the art at the time of the patent application.” Accordingly, Anacor had not been denied its procedural rights.
Anacor Pharms., Inc. v. Iancu, No. 17-1947 (Fed. Cir. May 14, 2018)
Lift of Stay Disallowed by District Court Post-SAS in View of PTAB’s Final Written Decision Lacking Non-Instituted Claims
by Andrew Schreiber, Matthew George Hartman & Rubén H. Muñoz, Akin Gump
The Delaware District Court issued an order on June 7, 2018 denying a party’s motion to lift a stay following the Patent Trial and Appeal Board’s (PTAB) final written decision in a parallel inter partes review (IPR) proceeding. Magistrate Judge Fallon determined that, in the aftermath of the Supreme Court’s recent decision in SAS Institute, Inc. v. Iancu, the PTAB’s partial institution of IPR was insufficient to satisfy the parties’ originally agreed upon stipulation—that the PTAB resolve all challenged claims—to fulfill the stay.
On July 29, 2015, DermaFocus LLC—a non-practicing entity—filed suit against Ulthera, Inc. in the District of Delaware alleging that the Ulthera infringed U.S. Patent No. 6,113,559 (the “’559 patent”) relating to a method and apparatus for therapeutic treatment of skin with ultrasound. Just shy of one year after DermaFocus’s complaint (on July 19, 2016), Ulthera filed an IPR challenging all claims of the ’559 patent. On November 11, 2016 the parties agreed to stay the district court litigation until the PTAB denied institution or issued a final written decision. Ultimately, the PTAB instituted IPRs on 16 of 18 claims and, on January 19, 2018, issued a final written decision rejecting all of Ulthera’s validity challenges. Consequently, DermaFocus moved to lift the stay.
Courts typically consider three factors when determining whether to stay, or lift a stay, in district court: (1) whether the stay will simplify the issues for trial; (2) the status of the litigation; and (3) whether the nonmoving party will be prejudiced—based on timing, delay, and the relationship of the parties. DermaFocus’s arguments to lift the stay centered on the more than two-year delay in litigation and the fact that the stay’s purpose had been fulfilled following the PTAB’s final written decision finding that all 16 instituted claims were patentable. Ulthera opposed the motion to lift the stay and instead sought a continuation based on its appeal to the Federal Circuit.
Although the aforementioned three factors normally govern motions to stay, Magistrate Judge Fallon determined that the SAS Institute decision mandated a different outcome. In SAS Institute, the Supreme Court ruled against the PTAB’s practice of partial institutions and held that the PTAB must issue final written decisions “with respect to patentability of any patent claim challenged” and that, in this context, “‘any’ means ‘every.’”
In the parallel IPR proceeding, the PTAB had instituted IPR on only 16 of the patent’s 18 claims. Accordingly, following the Supreme Court’s decision, Ulthera had filed a motion with the Federal Circuit requesting remand of the appeal to the PTAB for issuance of a final decision regarding patentability of the two claims not instituted. The Federal Circuit granted Ulthera’s remand motion and stated that the PTAB had “to resolve the patentability of all challenged claims in the pending IPR proceeding.”
As such, Magistrate Judge Fallon ruled that the parties’ stay agreement had not been fulfilled—specifically, the stipulation that the stay would be lifted “pending resolution by the PTAB of the patentability of all challenged claims in the pending IPR.” The motion to lift the stay was, therefore, denied because the conditions for originally implementing the stay still existed: the PTAB had not finished considering all challenged claims in light of the SAS Institute decision.
DermaFocus LLC v. Ulthera, Inc., 1-15-cv-00654 (D. Del. June 7, 2018) (Fallon, MJ) (order denying motion to lift stay)
PTAB Grants Limited Alternative to Overbroad and Delayed Additional Discovery Requests in IPR
by Colin B. Phillips, John Wittenzellner & Rubén H. Muñoz, Akin Gump
The Patent Trial and Appeal Board (“PTAB”) granted-in-part Patent Owner Twilio Inc.’s motion for additional discovery pursuant to 37 C.F.R. § 42.51(b)(2). Though the “Patent Owner delayed in seeking the requested discovery” and its “requests lack[ed] clarity and [were] overbroad,” the PTAB nevertheless allowed limited additional discovery to four specific documents which Patent Owner had identified as satisfying the discovery requests.
In defending two of its patents which were subject to IPR, the Patent Owner requested additional discovery regarding several objective indicia of nonobviousness—namely, copying, long-felt but unmet need, and failure by others. Specifically, the Patent Owner requested:
1) Documents showing Petitioner agents’ or employees’ access to Patent Owner’s patented technology, including documents showing how that information was used by Petitioner; and
2) Documents showing customer requests that led to Petitioner’s development of its products accused of infringement in the related district court litigation.
The PTAB may grant additional discovery if the moving party shows “that such additional discovery is in the interests of justice.” 37 C.F.R. § 42.51(b)(2)(i). In making that determination, the PTAB applies the so called Garmin factors: 1) whether there is more than a mere possibility or allegation that something useful will be found; 2) whether the requesting party seeks the other party’s litigation positions and the underlying basis for those positions; 3) the requesting party’s ability to generate equivalent information by other means; 4) whether the instructions are easily understandable; and 5) whether the requested discovery is overly burdensome.
The PTAB determined that the first three factors favored the Patent Owner’s additional discovery. The fourth and fifth factors, though, weighed against the additional discovery. Among other reasons, the requests were not limited to documents from a specified time range, nor did they specifically identify which of Petitioner’s products applied to the requests. Further, the Patent Owner delayed in seeking the requested discovery, filing its motion only two weeks before its Response to the Petition was due.
The PTAB’s solution was a compromise. Due to the fourth and fifth Garmin factors, the PTAB concluded that it could not grant the Patent Owner’s motion in full. But the Patent Owner had represented in its motion that it could specifically identify four documents that would satisfy the requests. The PTAB took that representation as a fall-back position, and ordered the Petitioner to produce those four documents
Telesign Corp. v. Twilio Inc., IPR2017-01976 IPR2017-01977, Paper 22 (PTAB June 7, 2018)