Final Rule Package: Phillips Standard to be Used by PTAB in IPR Claim Construction

by Dennis Crouch

The USPTO’s Final Rule Package on Inter Partes Review Claim Construction is set to publish in the Federal Register on October 11, 2018.  Up to now, the PTAB has been using the USPTO “broadest reasonable interpretation” standard to interpret challenged patent claims.  Under the new rule, the PTAB will now rely upon the PHOSITA standard more traditionally used for issued patents as articulated by in Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc) and further developed in later cases. This new rule will apply in IPR, PGR, and CBM proceedings.  The new rule also indicates that prior claim constructions by a court or USITC “will be considered.”  This final rule is essentially unchanged from the proposed rule found in the May 2018 NPRM.  Timing: The new claim construction applies to cases involving “petitions filed on or after the effective date of the final rule, which is November 13, 2018.”

[Final Rules 2018-22006]

The change will make it incrementally harder to challenge patents in IPR proceedings — and so there may be some rush to file prior to the November 13, 2018 deadline.  However, studies have not really found BRI as applied by the PTAB to be broader than court construction.  The different standard has led the various tribunals to disregard and ignore the parallel decisions in other fora. I have supported this rule change — with the hope that it will to more respect between the judicial tribunals,  fewer seemingly inconsistent opinions, and a quicker resolution of issues in constested patent cases.

The USPTO received 374 comments on the proposal — including two from me.    My comments generally supported the proposal but did suggest that the approach be modified to do an even better job of ensuring harmonization and respect for prior decisions.

Next step: I would also propose using the Phillips standard during regular ex parte prosecution.

39 thoughts on “Final Rule Package: Phillips Standard to be Used by PTAB in IPR Claim Construction

  1. 7

    Re: Goodbye BRI & Hello Phillips at PTAB inter partes proceedings.
    Just a few personal speculations as to realistic effects of this rule change. Feel free to disagree.
    First, One intent is for the IPR APJs to pay more attention to prior D.C. claim constructions. Is there any evidence of such widespread ignoring? How often can that even be possible? That is, a D.C. Markman decision is NOT normally made before the parallel IPR has to make their own claim interpretations first under the IPR time deadlines?
    Secondly, as widely noted, in terms of claim construction and ultimate claim breadth, there is not much actual difference in most cases. The claim language itself, read in light of the specification, and its meaning to POSITAs, and [at least if a clear disclaimer] the prosecution history, are already also part of BRI. The main difference is in resolving an ambiguity between two possible different interpretations of a claim element – one broader but one more likely intended. For all the fuss about this issue, it is very hard to find any actual IPR decisions that would clearly have been decided differently than they were under BRI. I never saw a clearly decisive one. Just pure dicta speculation in one Fed. Cir. IPR appeal. But it’s a political-pacifier for the many IPR-haters which can give the new Director some popularity.

    Thirdly would this change to IPR Phillips really encourage D.C. judges who normally delay their Markmans to do Markmans earlier, after seeing what the IPR did, or for judges that normally do them earlier to now do them later [after the IPR does its claim constructions]? But realistically how many D.C. judges will be that impressed with IPR claim constructions by mere APJs unless the basis is spelling out in detail? Do you really think an EDTX Federal judge, for example, is going to be impressed by an APJ claim construction? Also I doubt if that many patent owners really want to argue for a faster and narrower claim interpretation, if it could possibly lead to S.J. for non-infringement for the defendants at the D.C? Or, reductions in defendant discover burdens by reducing accusable products?

    1. 7.1

      How often can that even be possible? That is, a D.C. Markman decision is NOT normally made before the parallel IPR has to make their own claim interpretations first under the IPR time deadlines?

      While I agree that it is rare that a dist. court reaches Markman before the parallel IPR between the same parties, the following timewise scenario is not at all uncommon: P sues A; A petitions for IPR and PTAB grants; PTAB finishes IPR; P sues B. In that case, if B finds it convenient (for whatever reason, either non-infringement or validity challenge) to import the claim construction from the P vs. A IPR into the P vs. B district court proceedings, B can do so based on the ordinary operations of issue preclusion if (but only if) the PTAB uses the same Philips standard as the court.

      In other words, I would not be too quick to say that this change of standards will have no effect. It might not have much of an effect for the IPR petitioner in the petitioner’s own corresponding infringement suit. It may, nonetheless, have downstream effects for the rest of the industry.

      1. 7.1.1

        P v. A and P v. B generates issue preclusion? What if B and A are fighting over a different claim term?

      2. 7.1.2

        Greg, that was what a meant by “parallel.” [Not a second suit against an unrelated defendant B after an IPR was won [not lost] by the patent owner against defendant A.]
        Also, I would like to see more legal discussion of “ordinary operations of issue preclusion” here that would really constrain a D.C. judge’s claim construction in the second suit, since IPR claim construction is not usually even a contested issue in the Fed. Cir. appeal of the IPR decision?

        1. 7.1.2.1

          Perhaps I just need more caffeine, but your post looks like there are some typos there that obscure your meaning, Paul. I am not following what you are trying to say.

          As for “claim construction… not usually [being] even a contested issue in the Fed. Cir. appeal…,” I am not clear why the CAFC appeal is a relevant consideration. Issue preclusion requires that the party being estopped from having had a full and fair chance to litigate the issue in some forum. That litigation does not have to happen at the CAFC. It is perfectly fine for issue preclusion to flow from a dispute in a lower tribunal, even if the issue is not later contested in front of an appellate tribunal.

    2. 7.2

      Paul Morgan, turning the lights on for everybody: it’s a political-pacifier for the many IPR-haters which can give the new Director some popularity.

      Yup. But rest assured that pacifier will be chewed up into a million pieces and sp it out pretty much instantly because, well, h@ ters gonna h@ te. These people are never satisfied, as we all know.

      But they are easily f00 led.

  2. 6

    In theory, I would be in favor of the idea of a Phillips-style claim construction before first action. It seems at first glance that it would make examination much easier and lead to allowances much more quickly. Prosecuting attorneys would likely love it. But I think most applicants would quickly come to regret such a system.

    As it stands now, huge amounts of claim scope are present in an issued patent solely because of the ambiguity between what the prior art says and what the specification discusses. That ambiguity remains in place until a judge looks to see what the true scope is. The Markman hearing could be years down the road, after a market has developed around the invention and after competition has clumsily trod within the bounds of the claim’s BRI. A Markman hearing at that point is strongly to the advantage of the patentee, because they can raise arguments as to their preferred claim construction with the full knowledge of what scope they need to win their suit against a particular infringer while still avoiding whatever prior art the defendant has brought up.

    If you essentially move that Markman process to happen during prosecution, you give up those years’ worth of subsequent knowledge, and you pin down the claim scope in the dark, getting around prior art but not knowing whether you’ll be able to catch your competitors in the trap.

    As a matter of public policy, I’m personally in favor of that notion. (Speaking solely for myself here, of course.) The function of a claim is to serve as public notice of what is being protected, and that scope should be clear from the day of issuance, not in some sort of Schrodingeresque state where competitors can’t be sure whether they need to be careful concerning a given patent to avoid infringement. But because such a process would be so limiting to the applicants, the fights over that process during prosecution would undoubtedly be hard-fought and frustrating to all involved.

    Besides, if you think that an examiner using BPI instead of BRI is bad, just think about that same examiner making decisions about the scope of your claims that will stick with it throughout all future litigation.

    1. 6.1

      Excellent points APTG. Yes, even the need for any Phillips claim interpretation of some claim elements may not even be apparent until the claim is being read years later against a product launched years later [which product is unlikely to be exactly like any spec examples]. And most patent owners want that flexibility for infringement assertion scope.

  3. 5

    I’m fine with BRI during prosecution. Now all we need is for Mr. Iancu to tell the examiners to stop applying BUI and apply BRI.

    1. 5.1

      Before they can be told to stop using BUI, they have to be taught the difference between BRI and BUI.

      Hint: key word searching is not a panacea.

  4. 4

    DC: Next step: I would also propose using the Phillips standard during regular ex parte prosecution.

    Umm …. why? Not saying that there isn’t a good reason for doing that but BRI seems to have a real purpose during regular prosecution.

    For instance, isn’t the public better served when the Examiner forces an applicant to amend a claim so its boundaries are more clear, as opposed to applicants making claim construction arguments about how “someone skilled in the art” would understand the claim (based on the specification)?

    I’ve yet to see an ordinary prosecution case where BRI was unjustly used to deny anyone a patent. Can you show me one, Dennis, where you feel that happened?

    Just one.

    1. 4.1

      seems to have a real purpose during regular prosecution.

      No doubt.

      Of course, if one takes a closer look AT that purpose — and the necessary realization that the mechanism induces a patentee to claim LESS than what they otherwise may have a right to claim…

      (your “deny” is a bit overblown, as rational actors will most likely take the less-than-truly-deserved scope as opposed to taking nothing)

      1. 4.1.1

        the necessary realization that the mechanism induces a patentee to claim LESS than what they otherwise may have a right to claim…

        Except it doesn’t do that. The patentee has a right to claim what Philips allows them to claim.

        All BRI does at the prosecution level is avoid the time and expense of conducting a full-blown claim construction of every term in the claim (which is how applying Phillips would necessarily need to work — assuming it’s not just lip service you’re giving to it — in view of the fact that the judicial economy issues that exist during litigation aren’t present at the prosecution stage).

        1. 4.1.1.1

          Except it doesn’t do that. The patentee has a right to claim what Philips allows them to claim.

          Absolutely.

          But this is exactly why the comment by Prof. Crouch — to which you are taking exception to — fits.

          And this is my point.

          You seem to have confused yourself here.

          1. 4.1.1.1.1

            … do you even “get” that BRI and Philips are not the same things?

            Are you aware of the rationale — given by the Office — for BRI during prosecution?

            Or are you just diving in because you think that otherwise, patentees may obtain some benefit (your cognitive dissonance kicking in)….?

          2. 4.1.1.1.2

            So … the Office needs to do a Phillips claim construction for every term in the claim?

            How do they get around not doing that?

            Related: do you believe that there’s a systematic and detectable difference between applying plain and ordinary meaning versus broadest reasonable interpretation? Do you have any evidence supporting this? Because if I put on my Examiner shoes I don’t see any difference at all.

            Here’s what I do know, however: the more burdens you put on the PTO as you screech ins@ nely about the “slowness” and the “fees” (which you and your cohorts habitually do) the easier it will be to get a junk patent out the door.

            Is there a shortage of junky patents right now, Billy? Tell everyone. You’re a very serious person and totally not a mealy-mouthed hypocrite with an agenda who will do and say literally anything if you think it will make it easier to obtain and enforce the cr @ppiest patents in the history of any patent system on earth.

            1. 4.1.1.1.2.1

              do you believe that there’s a systematic and detectable difference between applying plain and ordinary meaning versus broadest reasonable interpretation? Do you have any evidence supporting this?

              Maybe you should pay attention to what has already been posted and look to what the Office itself says.

              Come man – this is (or should be) common knowledge that you seem oblivious to.

              Because if I put on my Examiner shoes I don’t see any difference at all.

              What you state that you see is rather immaterial to what IS.

              Your last two paragraphs are nothing but you making up (yet another) strawman to jump into the weeds with. Try FIRST staying on topic long enough for you to educate yourself.

              1. 4.1.1.1.2.1.1

                Maybe you should pay attention to what has already been posted and look to what the Office itself says.

                Maybe you should answer the question I asked. The first part is really easy! yes or no. The second part is relatively difficult cuz it kinda puts a bad spin on the first part (depending on your answer). You have my sympathies.

                Also: read the question carefully so you know what it is that you are actually answering. Ask for help if you need it.

                1. I am NOT the one needing help here Malcolm – that would be you.

                  Come man, grasp what BRI entails – and what it entails as directly stated by the Office.

              2. 4.1.1.1.2.1.2

                What you state that you see is rather immaterial to what IS.

                Endlessly amusing coming from the mouth of a guy who finds it impossible to determine the difference between an abstraction (labelling a piece of paper, virtual or not), on one hand, and a structurally characterized new chemical composition on the other.

                Almost too hilarious for words but we strive here to focus the laughter where it so righteously belongs (i.e., on “anon” and his ridiculous cohorts).

                1. You are going into the weeds with your Accuse Others meme instead of staying on point.

                  Gee, that’s a surprise…

                  Not.

    2. 4.2

      bri is to make things more narrow usually as opposed to making them more clear. Though more clear can happen as a result of the more narrow.

      If you just want more clear, then 112 is the tool.

      1. 4.2.1

        6: bri is to make things more narrow usually as opposed to making them more clear. Though more clear can happen as a result of the more narrow.If you just want more clear, then 112 is the tool.

        Last time I checked 112 included some language which, when applied correctly, forces applicants to narrow their claims to correspond to what the specification enabled and what the applicant possessed at the time of filing. Pretty sure that language is still there. Something about written description and enablement, I think.

        That said, you are correct that “clarity” and “narrowing” often (very often) go hand in hand. When the PTO is doing its job correctly with BRI, the claims are brought “down to earth” so that one isn’t confronted with ambiguity about the meaning of a claim term that could be construed broadly. Applicant’s should never be allowed to define terms for the first time in the prosecution history to avoid prior art. If the applicant is relying on something in the spec to justify a narrower definition, and that definition is justified, then that definition should be put expressly in the claims.

        1. 4.2.1.1

          Applicant’s should never be allowed to define terms for the first time in the prosecution history to avoid prior art.

          LOL – and how would you avoid that? Penalize the applicant in some draconian manner?

          Your cognitive dissonance is S C R E A M I N G.

          1. 4.2.1.1.1

            LOL – and how would you avoid that? Penalize the applicant in some draconian manner?

            Uh … no. They can point to the specification to support the proposed definition and then put the proposed (and narrowing) definition expressly in the claims. If there is no support, then the prior art invalidates the claim.

            Please, please, please go ahead and explain to everyone how that result is “draconian”, Billy. You’re a very serious person! Pull out the Constitution and start w@ cking yourself off with it like you usually do. That’s always super impressive and compelling.

            Remember, folks: this is how the maximalists think. Denying a patent is like forced sterilization or de@th by slow strangulation. “Draconian” I tells ya! Rich people just can’t be treated that way in the United States.

            1. 4.2.1.1.1.1

              Your answer of “explicit definition” is an impossibility given a number of factors.

              1) the actual prior art an examiner chooses to use is UNKNOWABLE

              2) ANY word can be made into an issue.

              3) ANY definition (that you would want) would – of necessity – be itself made up of words (and then see point 2) above.

              You wanting a nigh immediate invalidation given the larger picture understanding only evidences your abject venom towards patents. Hence, the comments about your cognitive dissonance.

              You really should get into a field in which you can believe in the work product produced.

              1. 4.2.1.1.1.1.1

                Things probably aren’t so hard to foresee in his art anon. Any good drafter can usually foresee like 90%+ of things they need to tighten up their WD of at the outset in my art. If not like 95%+ and higher the better the drafter is.

                1. It matters not at all his art unit 6 — for the reasons I have given.

                  (Remember, he is aiming for the Draconian – must be invalidated; he is NOT talking about normal prosecution practice)

        2. 4.2.1.2

          “When the PTO is doing its job correctly with BRI, the claims are brought “down to earth” so that one isn’t confronted with ambiguity about the meaning of a claim term that could be construed broadly”

          That is true. But if you really want to police that and only that, I think 112 2nd would be the way to go. The BRI helps prevent the scope of the claim covering things in the prior art under a broader interpretation, it isn’t just a general tool to police clarity. Still I think you know that, but we’re just philosophically disagreeing on what should be done to police such things. In a perfect world the congress would hand us a tool explicit in a new section of 112 that polices clarity explicitly and doesn’t depend on 112 2nd’s wording, or on what prior art happens to show (as with BRI).

          “Applicant’s should never be allowed to define terms for the first time in the prosecution history to avoid prior art.”

          Idk about that. If they have WD for the new wording, either implicit or explicit I think it’ll be fine. Though to the greatest extent possible the definition itself should go in the claim as opposed to just the “term” which is being defined.

          1. 4.2.1.2.1

            If they have WD for the new wording, either implicit or explicit I think it’ll be fine. Though to the greatest extent possible the definition itself should go in the claim as opposed to just the “term” which is being defined.

            Right — we agree on this. If was not clear about that, I apologize.

            1. 4.2.1.2.1.1

              You were not clear on that (and still are not clear on that).

              Everyone NOW operates under a “no new matter” rule. Given that, what then is your mewling about?

              1. 4.2.1.2.1.1.1

                Please, son, go play in the street.

  5. 3

    Thank you Mr. Director.

    Great news for American inventors past, present, and future.

  6. 2

    The next step should be to make the patent judges ALJ so they are independent of the PTO admin.

    1. 2.1

      Why not just reformulate the Article III mechanism?

      (And if you are “going there,” why not employ Congress’s Constitutional authority of jurisdiction stripping from the Supreme Court the non-original jurisdiction of patent appeals?)

    2. 2.2

      What bearing does the Lucia v. SEC decision have on that? It would seem that the arguments in that decision would be pretty relevant to your point as well.

      link to supremecourt.gov

  7. 1

    I would also propose using the Phillips standard during regular ex parte prosecution.

    I approve of this intuition, except that I would do it the other way around: I think that we should use BRI in litigation. In other words—consistent with all of the usual rules of claim construction—in a close case, resolve the doubt in favor of breadth of patentee’s scope (for both infringement and validity contests). One way or the other, however, there really should be only one claim construction standard.

    1. 1.1

      If you really think that there should be only one standard, you should be upset with why we have “BRI” in the first place.

      Hint: it has to do with knowingly reading the claims as “over broad” in order to achieve claim amendments and “be sure” that claims are proper. In other words, instead of being sure in a meaningful way, we allow examiners to err in removing possible legitimate scope “just to be sure.”

      There is an anti-patentee taint that exists.

      Instead of aiming for a “right fit,” the mechanism aims for an “insurance fit” (and willingly errs on the side of taking from the innovator).

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