by Dennis Crouch
The Federal Circuit’s 2023 decision in Axonics, Inc. v. Medtronic, Inc. marked an important change in inter partes review procedure, ensuring petitioners have an opportunity to respond patentee’s newly proposed arguments, with the hope of discouraging patent owners from holding-back (“sandbagging”) at the institution stage. Case-in-point is the Federal Circuit’s recent Apple v. Omni MedSci decision authored by Judge Alan D. Albright sitting by designation.
Ten years ago – 2014 – the Supreme Court decided Alice Corp v. CLS Bank, holding that – yes indeed – the expansive language of Mayo v. Prometheus (2012) applies equally to software and technology patents. A few weeks later, the USPTO began a dramatic transformation – pulling back notices of allowance and issuing thousands of supplemental office actions. The Federal Circuit’s May 2024 en banc decision in LKQ v. GM is perhaps as dramatic a change for the design patent arena as Alice was for utility patents. The old Rosen-Durling test made it almost impossible to reject a design patent as obvious except for extreme cases involving either direct copying or extremely broad claims. The key difficulty was that precedent required the obviousness inquiry to begin with a single prior art reference that is “basically the same” as the claimed design – a roughly 1-to-1 relationship. Further, any secondary references had to be ‘so related’ to the primary reference that features in one would suggest application of those features to the other.” In LKQ, the court found those requirements “improperly rigid” under principles of KSR which require a flexible obviousness inquiry. The overall effect is to make it easier to find a design patent obvious.
Immediate Reaction: The decision was released May 21, 2024, and Dir. Vidal released examination guidance to the design corps the next day. The guidance indicated that additional training will be coming soon -“in the short term.” However, it does not appear that Dir. Vidal has, thus far, asked examiners to take a second look at the applications waiting allowance. Design patents continue to issue at a steady rate of about 1,000 per week, with most of those issuing today having received their notice-of-allowances back in Jan/Feb 2024.
Examination Outcomes: Interestingly, I could not find any design patent obviousness rejections coming out of the USPTO since May 22, 2024.* For the same period in 2023, I found a much larger number of cases with obviousness rejections. What I take from this is that it appears that there will likely be an examination slowdown as the USPTO develops its new examination process — understanding what obviousness search and rejection looks like under the new approach.
Note, one difficulty with studying design patent examination is that design applications are generally not published prior to issuance — and abandoned cases are never published. One caveat to this general rule is that design applications claiming priority to Hague Convention filings are open to the public. For my study here, I looked only at those Hague filings.
PTAB: So far we also have no PTAB decisions interpreting LKQ.
Guest post by Ashton Woods, a JD candidate and member of the Juelsgaard Intellectual Property and Innovation Clinic at Stanford Law School. This post is part of a series by the Diversity Pilots Initiative, which advances inclusive innovation through rigorous research. DPI will be hosting its second conference at Emory University Law School in Atlanta on Friday, September 20, 2024. Indicate your interest by signing up here.
On February 21, the USPTO issued a Notice of Proposed Rulemaking for Expanding Opportunities to Appear Before the Patent Trial and Appeal Board (PTAB), and DPI filed one of seven comments on the proposal. DPI’s full comment can be found here.
Currently, parties appearing before the PTAB who are represented by counsel must designate lead and backup counsel. Lead counsel must be a USPTO-registered practitioner, meaning that they have technical training and have passed the registration exam (commonly known as the “patent bar” exam). Backup counsel may be non-registered if they are recognized pro hac vice. Under the Proposed Rule, counsel can switch roles, with a non-registered practitioner acting as lead counsel and a registered practitioner acting as backup counsel. Additionally, parties who can show good cause, including financial hardship, can waive the backup counsel requirement, though the party’s sole counsel must still be a registered practitioner. Finally, the Proposed Rule streamlines the pro hac vice recognition process for non-registered practitioners, though they still must be accompanied by a registered practitioner in the lead or backup role.
As explained in more detail in the full comment, DPI views the Proposed Rule as a modest step toward reducing the accessibility gap for potential patentees, patent practitioners, and patent challengers. The goal of the Proposed Rule is laudable, and it may provide a solid foundation for future efforts to diversify the Patent Bar and the patent system more broadly—if it can effectively expand the pool of eligible practitioners in proceedings before the PTAB, the Proposed Rule may support wider USPTO efforts to increase the participation of underrepresented communities in the innovation ecosystem.
Still, the Proposed Rule does not address all of the structural barriers within the patent system that continue to burden diversification efforts at the USPTO. Existing barriers, such as the technical training requirement and the patent bar exam, substantially narrow the class of patent practitioners. This is particularly troublesome considering that federal courts do not subject litigators to these standards—they impose no registration requirement or backup counsel requirement. Currently, there is no rigorous evidence to support these restrictions as necessary, rather than overly burdensome, in promoting competent, or even fantastic, representation before the PTAB.
DPI urges the USPTO to collect the empirical evidence necessary to ensure that USPTO initiatives are well-suited to promoting the goals of the Proposed Rule and the USPTO more broadly. The comment sets out exemplary data collection methods and key data points on PTAB filings and proceedings for the USPTO’s consideration. The comment urges the USPTO to affirmatively collect this data to rigorously assess the impact of the Proposed Rule, and other diversity initiatives, on inclusivity and accessibility at the USPTO.
DPI’s full comment on the USPTO’s Notice of Proposed Rulemaking for Expanding Opportunities to Appear Before the Patent Trial and Appeal Board can be found here. To stay informed about related work, sign up for DPI research updates by emailing diversitypilots@gmail.com.
by Dennis Crouch
The USPTO recently released yet another Notice of Proposed Rulemaking (NPRM) — this one focusing on codification of IPR/PGR rules associated with non-merits based “discretionary denials” of institution as well as termination due to settlement. This is a controversial area because of that word ‘discretion.’ Unrestricted discretion by government officials is concerning because of the potential for arbitrary or biased decisions, lacking transparency and accountability. In that frame, these rules are beneficial because they structure and limit discretion – hopefully making the outcomes more predictable and justifiable. A key note – the rules here focus primarily on procedure (separate briefing for discretionary denials) and substantive issues relating to parallel, serial, and cumulative petitions. Although this is an important step, they do not address discretionary denials associated with parallel litigation (or other outside factors) under Fintiv and subsequent director guidance. This is likely the most controversial area of discretionary denials that is being left out for now.
Congress clearly intended the USPTO to have substantial discretion (more…)
by Dennis Crouch
The USPTO has published a notice of proposed rulemaking (NPRM) to formalize the process for Director Review of PTAB decisions. These proposed rules come in response to the Supreme Court’s decision in United States v. Arthrex, Inc., 141 S. Ct. 1970 (2021), which underscored the necessity for the USPTO Director to have the ability to review PTAB decisions to comply with the Appointments Clause of the U.S. Constitution. Of course, the USPTO has been operating under an interim procedure for Director Review that began soon after Arthrex, but has been updated a couple of times. The NPRM closely follows the most recent version of the interim rules. (more…)
By Chris Holman
Sanofi-Aventis Deutschland GMBH v. Mylan Pharms Inc., 2023 WL 3311549, — F.4th — (Fed. Cir. May 9, 2023).
The “analogous arts” test is used in patent law to determine whether a particular reference is relevant for the purposes of an obviousness analysis. Under this two prong test, a reference is relevant if it is from the same field of endeavor as the invention at issue, or if it is reasonably pertinent to the problem the invention is trying to solve. In re Bigio, 381 F.3d 1320, 1325 (Fed. Cir. 2004)
In its 2007 KSR v. Teleflex decision, the Supreme Court ruled that the obviousness analysis should be more flexible and not confined to rigid rules or tests. Rather, KSR emphasized an “expansive and flexible approach” to obviousness. While KSR did not directly address the analogous arts test, it could be interpreted as calling for a more flexible approach allowing courts and the PTO more leeway to consider prior art from a broader range of sources as being “analogous” or “reasonably pertinent,” which in principle should make it easier for challengers to invalidate patents.
In inter partes review (IPR) proceedings, the Patent Trial and Appeal Board (PTAB) has invalidated patents claims for obviousness based on cited prior art that the PTAB found to be analogous, and until now the Federal Circuit has consistently affirmed those decisions on appeal. Unwired Planet, LLC v. Google Inc., 841 F.3d 995 (Fed. Cir. 2016); Smartdoor Holdings, Inc. v. Edmit Indus., Inc., 707 F. App’x 705 (Fed. Cir. 2017); Toyota Motor Corp. v. Reactive Surfaces Ltd., LLP, 816 F. App’x 480 (Fed. Cir. 2020); CyWee Grp. Ltd. v. Google LLC, 847 F. App’x 910 (Fed. Cir. 2021); and Kamstrup A/S v. Axioma Metering UAB, 43 F.4th 1374 (Fed. Cir. 2022)).
On occasion, the PTAB has found cited prior art to be non-analogous, and thus irrelevant for purposes of the obviousness inquiry. The Federal has twice affirmed those decisions on appeal. Polygroup Ltd. MCO v. Willis Elec. Co., Ltd, 759 F. App’x 934 (Fed. Cir. 2019) and Broadcom Corp. v. Int’l Trade Comm’n, 28 F.4th 240 (Fed. Cir. 2022)). In one reported decision, Donner Tech., LLC v. Pro Stage Gear, LLC, 979 F.3d 1353 (Fed. Cir. 2020), the Federal Circuit vacated and remanded after concluding that the Board had applied the wrong standard when it determined that a cited prior art reference was not analogous art.
On May 9, in Sanofi-Aventis Deutschland GmbH v. Mylan Pharms. Inc., the Federal Circuit held for the first time (to the best of my knowledge) that the PTAB erred in finding cited prior art to be analogous in an IPR. Significantly, the Federal Circuit’s decision did not address the merits of the analogous art question, but instead was based entirely on the fact that the patent challenger (Mylan) had failed to allege that the cited prior art was analogous to the challenged patent (U.S. Patent No. RE47,614, which relates to pen injectors used for the delivery of drugs such as insulin).
The court observed that:
A petitioner is not required to anticipate and raise analogous art arguments in its petition; instead a petitioner can use its reply to “respond to arguments raised in the corresponding opposition, patent owner preliminary response, patent owner response, or decision on institution.” See 37 C.F.R. § 42.23. However, Mylan did not use its reply to explain how de Gennes is analogous to the ‘614 patent.
The court reversed the PTAB’s finding of nonobviousness because it had relied upon a finding that the de Gennes reference was analogous prior art, but Mylan had never made the required analogous art argument. Mylan argued on appeal that it had, in its IPR petition, effectively argued that the de Gennes reference was analogous to another other cited prior art reference, i.e., Burren, and that Burren and the challenged Sanofi patent address the “same problem.” However, the court found Mylan’s arguments as to Burren insufficient to carry its burden because they did not directly address the challenged patent.
The court explained that:
In evaluating whether a reference is analogous, we have consistently held that a patent challenger must compare the reference to the challenged patent. This conclusion is reinforced by the purpose of the analogous art test, which is to examine whether a reference can be considered as prior art to the challenged patent in the first place. [The] purpose of the “prior art” must be evaluated with reference to the inventor’s purported invention disclosed within the challenged patent.
by Dennis Crouch
NST Global, LLC, dba SB Tactical v. Sig Sauer Inc. (Supreme Court 2023)
This case has a low chance of being granted certiorari, but it still has some interesting elements regarding claim construction and procedure. This is a perfect case for the Supreme Court to issue a GVR (Grant-Vacate-Remand) with an order to the Federal Circuit to explain its reasoning.
The setup is common. Tactical sued Sig Sauer for patent infringement; Sig Sauer responded with an IPR petition that was eventually successful. Tactical appealed based upon the PTAB’s sua sponte claim construction that found the preamble to be limiting, but the Federal Circuit Affirmed without opinion.
The Supreme Court petition asks three questions:
The Tactical patents cover a forearm stabilizing brace that can be attached to a pistol. U.S. Patent Numbers 8,869,444 and 9,354,021. Sig Sauer initially was a distributor of Tactical’s product, but later began making its own competing product. At that point Tactical sued.
In the IPR petition, Sig Sauer did not request any claim construction. Likewise, the petition decision granting the IPR stated that no claim terms needed any express construction. “We agree—we need not expressly construe any claim term
to resolve the parties’ dispute.” During briefing, neither party requested construction of any aspect of the claim preambles. Eventually though, in its final written decision, the PTAB interpreted the preambles as limiting and then used that construction to conclude that the claims were invalid as obvious.
Yes, I said that the narrow construction led to the claims being found invalid. That is unusual — usually the addition of limitations helps to avoid the prior art. In this case though the focus was on objective indicia of non-obviousness. NST’s sales; copying by Sig; praise; etc. But, by giving weight to the preamble terms, the PTAB was able to destroy the presumed nexus between the claims and NST’s product. The result, those secondary indicia were found wanting because NST had not provided additional evidence “commensurate with the claims” as newly construed.
For context, the claims are directed to the attachment, but the preamble recites “a handgun” and “a support structure extending rearwardly from the rear of the handgun:”
1. A forearm-gripping stabilizing attachment for a handgun, the handgun having a support structure extending rearwardly from the rear end of the handgun, the forearm-gripping stabilizing attachment, comprising: . . .
The PTAB ruled that the claims require the handgun and also the support structure as recited in the preamble along with the forearm attachment described in the body. The problem for the patentee is that its objective indicia evidence focused on the forearm attachment, not the whole package. Thus, no nexus and no weight given to those secondary factors. In its decision, the PTAB when through the whole life and meaning analysis: “we conclude that the preambles of claims 1, 3, and 5 are ‘necessary to give life, meaning, and vitality to the claim[s],’ and, as such, are limiting.”
The case was already close because there is a long history of this sort of stabilizer going back to the 19th Century, and so the absence of secondary considerations led to the obviousness conclusion.
During the IPR trial, Sig Sauer had argued that the high sales were due to an odd regulatory scheme against semi-automatic rifles, and the pistol attachment was actually popular primarily because it allowed the pistol to be shouldered. On appeal, that was raised as an alternative justification for the judgment. But, in my view, the PTAB did not actually rule on that issue in the first place.
The patentee appealed, but the Federal Circuit panel of Judges Reyna, Schall, and Chen affirmed without opinion.
by Dennis Crouch
The Federal Circuit regularly affirms PTAB judgments without issuing any explanatory opinion to justify the result. Although not found in the Rules of Appellate procedure, the court has created its own local rule allowing itself to “enter a judgment of affirmance without opinion.” In a 2017 paper, I argued that these no-opinion affirmances violated both the spirit and letter of 35 U.S.C. 144, which requires the court to issue a “mandate and opinion” in cases appealed from the USPTO. Since that time, the Federal Circuit has continued its practice, issuing hundreds of no-opinion judgments. Throughout this time, dozens of losing parties have petitioned for en banc rehearing with the Federal Circuit or certiorari to the Supreme Court. Up to now, both courts have remained silent and have refused to address the issue.
A new pending petition raises the issue once again. Virentem Ventures v. Google (Supreme Court 2023). Virentem sued Google for patent infringement, and Google responded with a set of Inter Partes Review (IPR) petitions. The PTAB eventually sided with Google and invalidated the claims of all seven challenged patents. Virentem appealed; but the Federal Circuit affirmed the PTAB’s judgement without opinion under its local Rule 36.
The new petition to the Supreme Court asks four related questions:
The Virentem patents relate to time-scale modification — the speeding-up or slowing-down of media. You may remember Alvin, Simon, and Theodore — the Chipmunks. That unintelligible high pitch arguably is not really time-scale modification because it is such a failure. Rather, TSM modern impliedly requires maintaining pitch and intelligibility. In this case though, the PTAB broadly interpreted the term to include any system that speeds-up or slows-down media. With that broad interpretation, the tribunal then was able to find prior art rendering the claims obvious. Virentem argued that its patents would be seen as valid under the narrower construction. The PTAB’s response: If you wanted that limitation in the claim, you should have added it to the claim.
