Patentee Cannot Escape Estoppel via Pre-IPR-Institution Disclaimer

Arthrex v. Smith & Nephew (Fed. Cir. 2018) [Anthrex Decision].

The dispute in this case is about what should happen when a patentee disclaims its patent claims prior to an inter partes review institution decision.  The Arthrex patent at issue is U.S. Patent No. 8,821,541 which covers a suture anchor — similar to a dry-wall anchor, but sticks into flesh.

After Smith & Nephew filed its IPR petition Arthrex disclaimed the challenged claims.  PTO rules state that “No inter partes review will be instituted based on disclaimed claims.” 37 C.F.R. § 42.107(e). And, following the rule, the PTAB (acting pre-institution on in the shoes of the PTO director) terminated the petition without instituting the IPR.

Adverse Judgment: Following the disclaimer, the Board also issued what it termed a “Judgment Granting [Patentee’s] Request for Adverse Judgment Before Institution of Trial.”  The adverse judgment here is important because it carries with it estoppel against the patentee from “taking action inconsistent with the adverse judgment, including obtaining in any patent . . . [a] claim that is not patentably distinct from a finally refused or canceled claim.”  37 C.F.R. § 42.73(d)(3)(i).  Anthrex is has continuation applications pending with similar claims that would seemingly be impacted.

Request for Adverse Judgment. On appeal, Anthrex took issue with the Board’s determination that it had “requested” an adverse judgment. Rather, in its preliminary response to the IPR, Anthrex particularly stated that it was not requesting an adverse judgment. On appeal though, the Federal Circuit sided with the PTO — giving effect to 37 C.F.R. § 42.73(b)’s statement that “disclaimer of the involved application or patent” will be “construed to be a request for adverse judgment.”

The major difficulty I have with the decision here is that it intermingles pre- and post- institution language.  This is reflected in the rules adopted by the PTO, but not in the actual AIA that separately spells out authority and procedure for IPR institution decisions as compared with IPR trial.  Here, Anthrex appears to have not directly challenged the PTAB’s authority to issue an adverse judgment pre-institution.

Adverse Judgment Affirmed.

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Note – in the case the court also discusses why it has jurisdiction over this particular appeal.

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The decision for the court was penned by Judge Dyk and apparently joined by Judge O’Malley.  Judge O’Malley also wrote a concurring opinion explaining:

I write separately to point out that I have doubts about whether the Director had the authority under 35 U.S.C. § 316 (or any other statutory provision) to issue that regulation [i.e., 37 C.F.R. § 42.73(b)] or whether, if so, the regulation was properly promulgated.

The opinion is only a concurring opinion because the patentee here did not raise a facial challenge to the regulation.

In addition to Judge O’Malley’s concurring opinion, Judge Newman wrote in dissent – arguing that the regulation should be interpreted as only applying once an IPR is instituted.

32 thoughts on “Patentee Cannot Escape Estoppel via Pre-IPR-Institution Disclaimer

  1. 10

    So what is the PTO policy re a party pursing in their other applications claims that are not patentably distinct from their disclaimed claims where there is no such adverse judgment?

    And how likely would such claims be enforceable even if allowed?

    1. 10.1

      Paul, very interesting question there. Also consider the status of a continuation application prosecuting claims that requires a terminal disclaimer (double patenting rejection) over claims in a prior patent, where the patentee then disclaims them. I would think the examiner should withdraw the requirement for a terminal disclaimer.

    2. 10.2

      Also, as far as I am aware it has always been possible to avoid entry of an adverse interference decision by disclaiming assertedly interfering claims before the interference is declared. That can be a desirable cost-savings for the parties and the PTO whenever a party realizes that it cannot win the interference, due to a statutory bar, prior art, or whatever.

    3. 10.3

      Why would not disclaimed claims that are also in, or added to, other applications by the same owner be properly subject to “collateral estoppel,” a legal principle just re-sustained by the Fed. Cir. in MaxLinear, Inc. v. CF CRESPE LLC, 17-1039 [in the context of IPRs]?

  2. 8

    Off topic, I realise, but on the subject of the CRISPR patent wars, something interesting has just been reported by the IPKat blog:

    link to

    namely that the EPO has acceded to the request by no less than nine Opponents, to revoke one of the patents, for the reason that the corporate PCT Applicants were not legally entitled under Paris, to benefit from their claim to priority from the US provisionals. For investors, this has ramifications, everywhere except the USA.

    1. 8.1

      Er, this has implications for U.S. investors as well. It is both possible and common for U.S. investors to care about how a company’s product will fare in the EU markets.

      1. 8.1.1

        It was only investors inside the USA that I was thinking of Greg. I was supposing that return on their investment in their CRISPR patent portfolio might depend to some finite non-zero extent on the market elsewhere than in the USA. Not just in Europe. The result at the EPO will be replicated in every other non-US jurisdiction.

    2. 8.2

      For investors, this has ramifications, everywhere except the USA.

      What? Actually, the investors we work with in the USA appreciate the fact that we know something about the PCT and its requirements.

      Before you file your PCT and claim priority to an earlier filing, you make sure that *at least* the right to claim priority has been assigned to the applicants on the PCT by all the applicants on that earlier filing. In general practice, what this means is that you make sure that all the rights associated with a US provisional filing (the typical priority document(s) for a US applicant seeking worldwide protection) are assigned to the company/client before that company files its PCT application claiming priority to that provisional filing.

      This isn’t a “trap”. It’s just the law. The Broad (or its attorneys) messed this up. Either it was an unintentional screw up or it was a screw up that reflects some unstated conflict between the applicants on the priority doc. But it’s definitely a screw up and it’s not the kind that should be fixable by special pleading ala “think about the children!”. It’s a screw up along the lines of trying to protect a method of thinking about a correlation by reciting some prior art data gathering step. The bigger they come, the harder they fall etc.

      *Caveat: none of this applies to the s0ftie w0ftie crowd because they operate in an entirely different universe, being so incredibly important and deeply serious and all. The only people who don’t appreciate their awesomeness are luddite l 0 sers driving around in legacy vehicles. Just wait and see!

      1. 8.2.1

        That caveat only shows what an arse you are Malcolm.

        Of course, regulars here already know that.

        Yay 11 years, 11 and 1/2 months of the sAme blight!

      2. 8.2.2

        As you say, MM, it isn’t a trap, it’s merely “the law”. Clearly, you personally know what you need to know about the Paris Convention, and the right of priority which it provides.

        But you write that “we” know about the Paris right of priority. Who is “we”? As far as i am concerned, it remains undetermined, what proportion of US patent attorneys understand it as well as you do. It certainly isn’t all of them. I doubt even that it is most of them.

        But apart from that, yes, it does look here as if there was stress between co-owners, co-Applicants The Broad Institute, MIT, Harvard, the sub-set of the dozen or so academic researchers named as inventor/Applicant in one or other of the dozen or so US-pro priority filings that made it on to the PCT Request form as co-Applicant, and those members of the sub-set that did not.

        Perhaps the California-based rival research team were more clinical in their patent filings?

        And which well-informed investor will continue to deny that i) ground-breaking inventions are made, independently, at much the same time, by different teams in different places and that ii) any properly functioning patent system needs an efficient (fast) way to resolve, in such cases, the priority contest? Here, the earliest of the pro filings were before the AIA, the later ones not but, as I understand it, at least that fact does not further complicate the priority contest.

      3. 8.2.3


        Would this also apply to subsidiaries and affiliates under the same corporate umbrella? For example, if an inventor is an employee of Invent Co. but the IP is held in Bermuda Co. (an affiliate) are you saying that even though there are intercompany agreements requiring transfer and assignment of the invention, the original Invento CO. must be on the PCT application. (Both companies are subs of Parent Co.) Your thoughts?

  3. 7

    similar to a dry-wall anchor, but sticks into flesh

    I’m pretty sure that’s going to be the best thing I read all day.

  4. 6

    Right result, plain reasoning. Bye bye, junk claims! Now let’s watch the patentee whine and cry over the direct and just results flowing from its own behavior. Boo hoo hoo. So sad.

  5. 5

    If anything else, this adds MORE fuel to Oil States (noting that the PTAB had decided to “tread lightly” in the direct time period that Oil States was initially before the Supreme Court, but since then has gone back to flexing some incredible (and incredibly inordinate) “power” in the Executive branch administrative agency.

    1. 5.1

      How on earth is what happened here an “incredible power”? The patentee disclaimed its junk claims. It destroyed its own “property” (to use your nomenclature) to avoid having its dirty laundry exposed to the world. Where is the “incredible power” in construing 42.73(b) to be a request for adverse judgment?

      If the patentee wants to pursue and assert its junk, it should have found the guts to defend itself in the IPR.

      1. 5.1.1

        You are far too much (as usual) to take an anti-patent stance to realize the difference between disclaiming claims – in one particular patent – and “destroying their property” OVERALL (as you so “eloquently” put it).

        Maybe instead of the vapid ad hominem and instant anti-patent view, you take a moment and look at the legal issues actually involved…

        (I won’t be holding my breath)


          42.73(b) isn’t terribly ambiguous. The logical ramifications of disclaiming would be apparent to anyone.

          If you admit to everyone that your claim to x+y is junk and you are destroying it, you shouldn’t be surprised when that admission returns to handicap your effort to claim, e.g., x+y “wherein x is plastic”.


            Wake up son – whether or not that section is “terribly ambiguous” or not is NOT the legal point here.

            (Get over the point as to whether or not a patentee was on the downside)


              What’s the “legal point here”, Billy. Tell everyone!

              You’re a very serious person and totally not just committed to a ridiculous paranoid narrative about how the PTO is “anti-patent”.


                The “billy” aspect is beyond juvenile – but that’s Malcolm being Malcolm.

                As to the “legal point here,” that should be obvious: we have yet another example of your anti-patent animus showing up in the same “Ends justify the Means” as you refuse to even bother looking at the means and judge everything by your Ends “sniff” test.


          Claim invalidity and getting invalid claims out of the system is a “legal issue”, FYI. Kind of a huge issue in this particular fact pattern.

          I know bringing that up makes you uncomfortable (almost as bad as r@ cism!). I also don’t care.

    2. 5.2

      Junky claims and patentees who cling to them at all costs is why the PTO needs less power?

      I don’t follow.

  6. 4

    Every rule is written and construed to harass the inventor. If the PTAB did not stipulate to the terms of the disclaimer (that it was not a request for adverse judgment) why did they accept the disclaimer and proceed to enter the adverse judgment? They have a vendetta against inventors. The PTAB does not care about protecting inventions – they only care about destroying the patent and aiding infringers. Mr. Iancu, please align the PTAB with the charter of the PTO.

  7. 3

    I always wondered what those things were sticking out of the neck of Frankenstein’s Monster. #ThanksPatentlyO #TheMoreYouKnow

  8. 2

    Two remarks:

    (1) As usual when Judge Newman disagrees with Judge Dyk, Judge Newman has the better of this argument. The regulations use the word “trial,” and “trial” is defined to have a specific meaning that excludes this regulation from even applying in this case.

    (2) It is a pity for the appellant that they did not challenge the PTO’s authority to promulgate this regulation. It looks like there would have been a three way fractured panel regardless, but if they had preserved that ground of appeal, it would be a two-way reversal with Judge Dyk writing a dissent, rather than a two-way affirmance with Judge Newman dissenting.

  9. 1

    The actual question of whether the PTO can enter adverse judgment in cases like this still seems to be unresolved. Appellant’s counsel apparently only challenged the panel’s interpretation of its own rules, not the PTO’s authority to make the rules it made. If the Appellant had briefed and argued the statutory issue, they probably would have won, as indicated by Judge O’Malley’s concurrence.

    1. 1.1

      Karl, right.

      Note that the Director is supposed to decide whether to institute and until there is institution the PTAB has no statutory authority to enter judgment.

      1. 1.1.1

        The director – or his delegate…

        Judgement here DOES appear to be contrived (bootstrapped) given that no decision to institute was even reached.

        But Ned, the claims “smell” bad and do not the Ends justify the Means?

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