Amending Patent Claims in Post-Grant Trial Proceedings

Motion to Amend Framework

In a post-grant proceeding, a patent owner has the right to file one motion to amend. 35 U.S.C. §§316(d); 326(d). A motion to amend is typically due at the same time as the patent owner's response, i.e., typically three months after institution, and is limited to 25 pages.

The petitioner is permitted to oppose the motion to amend. The opposition is typically due with the petitioner's reply to the post-grant petition, i.e., three months after the motion to amend is filed. Like the motion, the opposition is limited to 25 pages. The petitioner is permitted to raise new arguments of unpatentability — and invoke new prior art — against the proposed new claims. The petitioner can also file new expert declarations addressing the proposed new claims.

The patent owner is permitted a reply in support of its motion to amend. The reply is typically due one month after petitioner files its opposition, and is limited to 12 pages. The patent owner is permitted to include additional expert declarations in response to the opposition.

Patent owners often file their motion to amend on a contingent basis. That is, a patent owner will request that the Board consider its motion to amend only if the Board finds the original claims unpatentable. See, e.g., PTAB Motion to Amend Study at 2.

The Board typically renders its decision on the motion to amend at the same time as it issues its final written decision in the IPR, PGR, or CBM.

Motion to Amend Requirements Based on Regulations

Per the Board's regulations, the patent owner's proposed substitute claims must “respond to a ground of unpatentability involved in the trial,” and must not seek “to enlarge the scope of the claims of the patent or introduce new subject matter.” 37 C.F.R. §42.121. There is a rebuttable presumption that only one substitute claim is needed to replace each challenged claim. See, id.

For each claim that is added or amended, the patent owner must also set forth support in the original disclosure, and support in any earlier-filed disclosure for each claim for which benefit of the filing date of an earlier-field disclosure is sought. See, id.

Additional Requirements Established by Case Law

In its decisions, the Board has also established additional requirements for motions to amend. Specifically, in Idle Free Sys., Inc. v. Bergstrom, Inc., Paper 26, No. IPR2012-00027 (11 June 2013) — designated as an “informative” opinion by the Board — the Board stated that the patent owner is required:

1. In all circumstances, to make a showing of patentable distinction over the prior art of record and prior art not of record but known to the patent owner;
2. In certain circumstances, to make a showing of patentable distinction over all other proposed substitute claims for the same challenged claim; and
3. In certain circumstances, to make a showing of patentable distinction over a substitute claim for another challenged claim.

Id. at 6-7.

The patent owner should also present constructions of new claim terms. Id. at 7.

In MasterImage 3D, Inc. v. Reald Inc., Paper 42, No. IPR2015-00040 (15 July 2015) — designated as a “precedential” opinion by the Board — the Board clarified the scope of the “prior art of record” over which the patent owner must demonstrate patentability. The Board stated that the term “prior art of record” as used in Idle Free means:

1. Any material art in the prosecution history of the patent;
2. Any material art of record in the current proceeding, including art asserted in grounds on which the Board did not institute review; and
3. Any material art of record in any other proceeding before the Office involving the patent.

MasterImage 3D, Inc., Paper 42 at 2.

Motions to Amend: Issues to Watch

Although motions to amend have been available for several years now, with so few having been granted, much is still unknown, and many aspects of motions to amend are still developing. Here are some of the issues to watch as the motion to amend jurisprudence develops.

Allocation of Burden of Proof: Changes on the Horizon?

The Federal Circuit is currently considering, en banc, whether in an IPR, the Board has appropriately placed the burden of showing patentability of the proposed amended claims on the patent owner. In re: Aqua Prods., Inc., Docket No. 2015-1177. At oral argument (held Dec. 9, 2016), there was much discussion noting that the operative statute (35 U.S.C. §316(e)) places the overall burden of proving a proposition of unpatentability in the trial proceeding on the petitioner, whereas the Board's established framework allocates the burden of proving patentability of the proposed new claims to the patent owner. In response, the Patent and Trademark Office solicitor argued that the burden is properly allocated to the patent owner, because 37 C.F.R. §42.20 — which relates to motion practice generally — specifies that the moving party has the burden to prove that it is entitled to relief requested in a motion, which includes motions to amend.

The tenor of some of the questioning from the judges suggested that they are skeptical of the current allocation of burden of proof. It would not be a surprise to see the Federal Circuit seek to change the allocation of burden of proof. The question would then become whether a change in the allocation of the burden would lead to more motions to amend being granted. It might. Given the low motion to amend grant rate to date, it is quite possible that a shake-up in the Board's motion to amend framework could lead to a more liberal attitude toward granting such motions.

Demonstration of Patentability: What About §§101 and 112?

The Board's decisions in Idle Free Sys., Inc. and MasterImage 3D specify only that the patent owner establish patentability of the proposed new claims over prior art. See, Idle Free Sys., Inc., Paper 26 at 6; MasterImage 3D, Inc., Paper 42 at 2. Nevertheless, the Board will sometimes also review the proposed new claims for compliance with other statutory requirements for patentability.

For example, in Ariosa Diagnostics v. ISIS Innovation Ltd., Paper 166, No. IPR2012-00022 (2 Sept. 2014), the patent-at-issue was also involved in co-pending district court litigation. After patent owner filed its motion to amend, the district court determined, on remand from the Federal Circuit, that the original claims were invalid under 35 U.S.C. §101. Ariosa, Paper 166 at 52. The patent owner had not addressed patentability under §101 in its briefing, and at the oral hearing, argued that per the governing regulations and case law, it need only address written description support and prior art patentability. Id. at 50. The Board disagreed, and denied the motion to amend because the patent owner had failed to explain how the proposed substitute claims overcame the district court's finding that the original claims were drawn to patent ineligible subject matter under §101. Id. at 52-53.

In view of cases such as Ariosa, where a court has ruled on the validity of the issued patent claims in a co-pending litigation, the parties in the post-grant proceeding should consider briefing the issue of patentability of the proposed amended claims under statutory requirements beyond §§102 and 103 printed-publication issues.

Impact of Amended Claims: Intervening Rights

It is important to keep in mind that intervening rights attach to patent claims that are amended in post-grant proceedings. See, 35 U.S.C. §§318(c), 328(c). This can have a big impact on infringement and damages issues in the co-pending litigation.

At present, few, if any, courts have been called upon to address the application of intervening rights in the post-grant context. However, the statutory language that establishes intervening rights in the post-grant context is similar to the statutory language that establishes intervening rights in the reexamination context. Compare 35 U.S.C. §§318(c) and 328(c) with 35 U.S.C. §307(b). Accordingly, jurisprudence stemming from the reexamination context — which itself builds on jurisprudence from the reissue context, see, 35 U.S.C. §252 — should be pertinent to the post-grant context.

In connection with the reexamination and reissue statutes, the Federal Circuit has explained that “the making of substantive changes in the claims is treated as an irrebuttable presumption that the original claims were materially flawed. Thus the statute relieves those who may have infringed the original claims from liability during the period before the claims are validated.” Bloom Eng'g Co. v. N. Am. Mfg. Co., 129 F.3d 1247, 1249 (Fed. Cir. 1997). There are two forms of intervening rights — absolute and equitable intervening rights. As the District of New Jersey explained in the reexamination context, “absolute” intervening rights “sever liability for an infringer for accused products that were made or used” before the new claim issued. LMT Mercer Group, Inc. v. Maine Ornamental, LLC, 2014 WL 284238, 9 (D.N.J. Jan. 24, 2014). With regard to “equitable” intervening rights, a court “may provide for a party to continue to engage in infringing activities — e.g., to continue to make or use products — after the reexamination certification has issued if the accused infringer made substantial preparations for the infringing activities prior to the reexamination.” Id.

Under these doctrines, a successful claim amendment in a post-grant proceeding can have a profound effect on the infringement and damages issues being litigated in the district court. It is crucial for a patent owner who is considering a motion to amend its claims via a post-grant proceeding take into account the impact of the amendment vis-à-vis intervening rights.

***** Cynthia Lambert Hardman, a partner in Goodwin Procter LLP's IP Litigation Group and co-chair of the firm's PTAB Practice, has over 15 years of experience litigating complex intellectual property cases in U.S. district courts and the U.S. International Trade Commission (ITC). A registered patent attorney, Ms. Hardman also litigates before the U.S. Patent and Trademark Office Patent Trial and Appeal Board (PTAB) in post-grant proceedings such as inter partes reviews (IPRs). She can be reached at [email protected].