Judge Newman Attacks Partial Institution of IPRs As Incompatible with AIA’s Motivations On Nov. 7, 2016, Federal Circuit Chief Judge Prost and Judges Newman, Lourie, Dyk, Moore, Reyna, Wallach, Taranto, Chen, Hughes, and Stoll issued a per curiam order denying a rehearing en banc, in SAS Institute, Inc. v. Complementsoft, LLC., Case Nos. 2015-1346, 2015-1347. The case was on appeal from the United States Patent and Trademark Office (PTO), Patent Trial and Appeal Board, No. IPR 2013-00226. Judge Newman dissented from the per curiam order and argued for a rehearing. She argued against the administrative practice called “partial” or “selective” institution, which the PTO had employed in this case. Under partial institution, the PTO may, in its sole discretion, choose to decide some, but not all, of the challenged patent claims on inter partes review. Judge Newman argued that partial institution is inconsistent with the goals of the America Invents Act (AIA), which sought to have efficient and reliable resolution of certain patent disputes without the cost, delay, and uncertainty of district court litigation. By not resolving the unselected claims, the PTO prevents finality, estoppel, and the expediency, economy, and efficiency that motivated the AIA. First, the legislative record unambiguously intended that inter partes review was meant to completely substitute for at least the patents-and-printed-publications portion of civil litigation. This substitution cannot occur if only some of the challenged claims are decided and other claims are left untouched. Second, there is no contemplation of partial institution in 35 U.S.C. §§312-313, which discuss the requirements of petition and preliminary response to petition. Third, although a petition “may or may not be instituted” in the PTO’s unchallenged discretion even where meritorious under 35 U.S.C. §314, this section does not contemplate the partial institution of only those parts selected by the PTO. Fourth, partial institution negates the purpose of bringing “more certainty in litigation,” since estoppel under 35 U.S.C. §315 cannot arise to claims that the PTO declined to review. Fifth, although 35 U.S.C. §316 authorizes the PTO Director issue regulations, the Administrative Procedure Act (APA) requires that a reviewing court set aside agency action found to be in excess of statutory authority. Finally, 35 U.S.C. §318 requires the Board’s final decision to encompass “the patentability of any patent claim challenged by the petitioner.” APA Guarantees Patentee In an IPR an Adequate Opportunity to Respond To Newly Asserted Facts From a Previously Disclosed Prior Art Reference On Nov. 9, 2016, a Federal Circuit panel of Judges Moore, Wallach, and Taranto, issued a unanimous decision, authored by Judge Taranto, in In Re: NuVasive, Inc., Case No. 2015-1672, 2015-1673. The panel affirmed the U.S. Patent and Trademark Office Patent Trial and Appeals Board’s (PTAB) decision in an inter partes review (IPR) proceeding, IPR2013-507, and vacated the PTAB’s decision in another IPR proceeding, IPR2013-508. U.S. Patent No. 8,187,334 was directed toward implants for spinal fusion surgery that are inserted between two vertebrae to replace a damaged disc. At issue were the limitations that the longitudinal length be greater than 40mm and at least 2.5 times the maximum width. NuVasive was not given fair notice of the petitioner’s reading of Figure 18 of the Michelson prior art until petitioner’s reply brief. The Board treated Figure 18 in Michelson as an essential part of its obviousness findings, as it relied on nothing else for a prior-art disclosure of an implant having the limitations at issue. The Federal Circuit found that the district court violated NuVasive’s rights under the Administrative Procedure Act (APA) by refusing to allow NuVasive to respond to the petitioner’s newly asserted facts about Figure 18 that later became critical in IPR2013-508. Under the APA’s standards, an adequate opportunity to respond to an asserted fact about a prior art reference is not lessened by the fact that a patentee had to respond to different factual assertions about the same reference. Thus, the Board’s decision of unpatentability in IPR2013-508 was vacated. By contrast, the Federal Circuit found that NuVasive was put on minimal notice of Michelson Figure 18 in IPR2013-507, because it was discussed in a citation referencing “longer than wide” implants. Thus, the Federal Circuit affirmed the Board’s decision of unpatentability in IPR2013-507. Consistent Characterization Of a Claim Term in a Particular Way Informs Claim Construction On Oct. 26, 2016, a Federal Circuit panel of Chief Judge Prost, Judge Taranto, and Judge Hughes issued a unanimous decision, authored by Chief Judge Prost, in ProFoot, Inc. v. Merck & Co., Inc., Case No. 2016-1216. The case was on appeal from the United State District Court of Illinois, which held that Merck did not infringe ProFoot’s patent. The Federal Circuit agreed with the district court’s claim construction of the word “neutralizer” and affirmed the district court’s stipulated judgment of noninfringement. ProFoot had originally sued Merck for infringement of U.S. Patent No. 6,845,568. Based on the district court’s claim constructions, the parties stipulated to a judgment of noninfringement of all asserted claims in the ’568 patent. The ’568 patent discloses a method for providing custom footwear inserts for sports involving side-to-side movement, such as skiing, skating, and cycling. It teaches a “neutralizer” which allows a fitting specialist to determine what angle the foot should be in to place the ankle in a neutral position. On June 17, 2015, the district court construed the term “neutralizer” as “a device that has a housing, a protractor, and an angularly adjustable plate capable of supporting the foot.” ProFoot challenged the district court’s construction of the term “neutralizer” and argued for a broad construction which called a “neutralizer” some kind of measuring device. The Federal Circuit found that the district court did not err by naming specific components that comprise the “neutralizer.” It explained that when a patent repeatedly and consistently characterizes a claim term in a particular way, it is proper to construe the claim term in accordance with that characterization. Here, the patent consistently and repeatedly discloses that the “neutralizer” includes a housing, protractor, and angularly adjustable plate components, and never describes or contemplates an embodiment of a “neutralizer” that does not have these components. Furthermore, the prosecution history of a parent application can be used as relevant evidence of the inventor’s understanding of a claim term. Here, the parent application described a “neutralizer” having a housing, protractor, and angularly adjustable plate in order to overcome prior art rejections. Accordingly, the Federal Circuit disagreed that a person having ordinary skill in the art would recognize a “neutralizer” as simply some kind of measuring device. Terms of Degree Are Not Inherently Indefinite, but Must Be Supplemented with ‘Objective Boundaries’ On Oct. 27, 2016, a Federal Circuit panel of Chief Judge Prost, Judge Wallach, and Judge Hughes issued a unanimous decision, authored by Chief Judge Prost, in GE Lighting Solutions, LLC. v. Lights of America, Inc., Case Nos. 2015-1979, 2015-1980, 2015-1981, 2015-1982, 2015-2044. The case was on appeal from the consolidation of several cases arising from the United State District Court for the Northern District of Ohio, which held that claims in two patents owned by GE Lighting Solutions (GE) were indefinite. GE had originally sued for infringement of its U.S. Patent Nos. 6,787,999 and 6,799,864. The Federal Circuit agreed with the district court’s determination that the ’864 patent claims are indefinite and reversed-in-part the determination that the ’999 patent claims are indefinite. The district court granted the defendants’ motion for summary judgment on the grounds that the terms “elongated” and “to heat sink” rendered the claims indefinite. The ’864 and ’999 patents are directed toward dissipating heat from LED lamps. All of the claims in the ’864 patent require an “elongated” thermally conductive core, which draws heat from the LEDs and dissipates it into the air. The Federal Circuit agreed with the district court that “elongated” is a term of degree which renders the claims indefinite. Although terms of degree are not inherently indefinite, they must be supplemented with “objective boundaries,” which allow a person with ordinary skill in the art to have reasonable certainty about the scope of the invention. Here, the patentee’s expert admitted that an ordinarily skilled artisan cannot, without additional information, differentiate an “elongated” core from a “non-elongated” core. The Federal Circuit disagreed that the district court’s construction of “to heat sink” in the ’999 patent renders the claims indefinite. “To heat sink” was construed by the district court as “to receive and dissipate heat from.” Although it is true that any amount of heat transfer is sufficient under the district court’s construction, whether a component heat sinks another component is an objectively defined fact with no “zone of uncertainty” for an ordinarily skilled artisan. ***** Howard J. Shire is Editor-in-Chief of this newsletter and a Partner in the New York office of Andrews Kurth Kenyon. He can be reached at email@example.com. Michael Block is an associate with the firm. He can be reached at firstname.lastname@example.org.
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