Final Written Decision Finding All Challenged Claims Unpatentable CBM2014-00060

Takeaway: A declaration submitted to the PTO by or on behalf of a patent owner is not hearsay because the submission evidences the patent owner’s belief that the statements contained within the declaration were true. In its Final Written Decision, … Continue reading

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  • Show Me the Money: Reasonable Royalty Damages Vacated Due to Much Higher Infringer’s Total Profits

    Author: Christopher B. McKinley Editor: Lauren J. Dreyer In Nordock v. Systems, No. 14-1762 (Fed. Cir. Sept. 29, 2015), the Federal Circuit affirmed that there is no apportionment of “total profits” awards under 35 U.S.C. § 289 in design patent infringement. In this case, Nordock sued Systems for infringing its design patent covering ornamental features […]

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  • Interviews: Google Speaks On Need For Balanced IP System; EPO On “Tomato II” Case, Board Of Appeal Revamp

    COPENHAGEN – Google is “really looking for a balanced IP system,” the company’s head of litigation told the Global Patent Congress, while the European Patent Office elaborated on the “Tomato II” case, which for civil society has become the very symbol of an imbalanced IP system. Intellectual Property Watch spoke with senior officials at both Google and the EPO at the conference.

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  • Insufficient Nexus Was Found for Secondary Considerations in Final Written Decision IPR2014-00679

    Takeaway: The granting of an injunction in a related proceeding, without more, does not demonstrate a nexus between the claimed subject matter and the objective evidence of a secondary consideration of industry praise and acceptance. In its Final Written Decision, … Continue reading

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  • PTAB zaps claims on on Novartis’ multiple sclerosis blockbuster Gilenya in IPR

    In IPR2014-00784 on US Patent 8,324,283, PTAB found claims 1–32 of US ‘283 unpatentable.
    MS drugs are a big deal economically; the current market for MS drugs is worth an estimated $20 billion a year.

    This oral drug for treating MS comprises a sphingosine-1
    phosphate (S1P) receptor agonist and a sugar alcohol. Ex. 1001, 1:11–14,
    1:33–35. “The sugar alcohol may act as a diluent, carrier, filler or bulking
    agent, and may suitably be mannitol.”

    PTAB noted

    We disagree, however, with Patent Owners’ argument that the
    inventors’ mere discovery of a new reason to combine fingolimod and
    mannitol renders nonobvious an invention that was known in the prior art.
    Where the prior art teaches the claimed invention, a claim is not rendered
    patentable by virtue of being motivated in the inventors’ minds by a newlydiscovered
    advantage of the prior-art combination; allowing such a claim to
    stand “would remove from the public that which is in the public domain.” In
    re Wiseman, 596 F.2d 1019, 1022 (CCPA 1979); see also Cross Med.
    Prods., Inc. v. Medtronic Sofamor Danek, Inc., 424 F.3d 1293, 1323 (Fed.
    Cir. 2005) (“One of ordinary skill in the art need not see the identical
    problem addressed in a prior art reference to be motivated to apply its

    As explained
    above, though, it does not matter that the prior art failed to recognize this
    advantage of a fingolimod-mannitol combination. “[T]he motivation in the
    prior art to combine the references does not have to be identical to that of the
    [patentee] to establish obviousness.” In re Kemps, 97 F.3d 1427, 1430 (Fed.
    Cir. 1996)

    Of long-felt need:

    Next, Patent Owners argue that the invention claimed in claim 19
    satisfied the long-felt but previously unmet need “for a solid oral [multiple
    sclerosis] treatment.” PO Resp. 55 (citing Ex. 2044 ¶¶ 25–27). The
    supporting evidence is a declaration stating that “some patients are resistant,
    afraid, or even unwilling to use needles,” which caused some patients to
    “drop[] the [multiple sclerosis] treatment”; that “parenteral medications were
    universally inconvenient,” making patients less likely to take their
    medication; and that “there were a number of side effects commonly
    associated with parenteral [multiple sclerosis] treatments” that “discouraged
    patients from continuing with their prescribed course[s] of treatment.”
    Ex. 2044 ¶¶ 25–27. Although no other evidence is cited in Patent Owners’
    briefing,21 additional record evidence shows that patients asked about the
    availability of an oral medication as early as 1993, id. ¶ 34, and that the
    introduction of the first oral medication in 2010 caused a “‘major shift in the
    treatment landscape,’” with “‘many patients . . . switching to oral therapy,’”
    id. ¶ 37 (quoting Ex. 2012, 1).
    Petitioners argue, Reply 18–19, that there is no evidence that the longfelt
    need was for claim 19’s combination of fingolimod and mannitol;
    instead, as Patent Owners acknowledge, PO Resp. 55, the need was merely
    “for a solid oral [multiple sclerosis] treatment.” According to Petitioners,
    any need for a solid oral dosage form of a multiple sclerosis treatment was
    satisfied by treatments that were known in the prior art but did not receive
    FDA approval until after Patent Owners’ Gilenya product did. Reply 18–19.
    Therefore, argue Petitioners, there was no longer any long-felt need by the
    time of the invention claimed in the ’283 patent. Id


    In 1999, Chiba itself suggested treating multiple
    sclerosis using a solid oral form of fingolimod. Ex. 1006, 6:26–49, 8:19–26.
    In addition, teriflunomide, marketed in solid tablet form as Aubagio®, was
    known in the prior art at least by April 1, 2002, when it was disclosed to be
    useful for treating multiple sclerosis when administered in tablets or
    capsules. Ex. 1037, at [22], 1:19–30, 2:60–3:2, 5:1–21; Ex. 2045 ¶ 63.22
    Similarly, a capsule form of dimethyl fumarate for the treatment of multiple
    sclerosis, marketed as Tecfidera™, Ex. 1070, 2, was disclosed in U.S. Patent
    No. 6,509,376 B1, issued January 21, 2003. Ex. 1097, at [45], 2:64–67,
    4:25–27, 4:31–33.


    Industry praise must be linked to the patented invention. Power-One,
    Inc. v. Artesyn Techs., Inc., 599 F.3d 1343, 1352 (Fed. Cir. 2010). Again, if
    objective indicia of nonobviousness are “due to an element in the prior art,
    no nexus exists.” Tokai Corp., 632 F.3d at 1369. Here, the evidence shows
    that what was praised about Gilenya was not the specific formulation recited
    in claim 19, but rather the general fact that Gilenya was a solid oral multiple
    sclerosis medication. As discussed above, however, a solid oral multiple
    sclerosis formulation was known in the prior art, so there is no nexus
    between the claimed invention and the industry praise.

    Tysabri (natalizumab ) is mentioned

    In either case, Dr. Blackburn excluded
    from his analysis any data regarding sales of Tysabri, id. ¶ 20 n.24,24
    multiple sclerosis drug that generates more than $1 billion in annual sales,
    Ex. 1041 ¶ 38; Ex. 1057, 5–6; Ex. 1058, 37. Dr. Blackburn’s evidence of
    Gilenya’s market share is biased towards more significant sales of Gilenya
    by this exclusion and, thus, is unreliable as evidence that Gilenya’s sales are
    significant in relation to the relevant market as a whole.

    As to amendment:

    Because we find each of claims 1–32 unpatentable, we next address
    Patent Owners’ motion to amend, in which claims 33–64 are proposed.
    Motions to amend are permitted by 35 U.S.C. § 316(d) and 37 C.F.R.
    § 42.121. In moving to amend their claims, as the moving the party, Patent
    Owners have the burden to show entitlement to the relief requested. 37
    C.F.R. § 42.20(c). “The burden is not on the petitioner to show [the]
    unpatentability [of the proposed claims], but on the patent owner to show
    patentable distinction over the prior art of record and also [the] prior art
    known to the patent owner.” Idle Free Sys., Inc. v. Bergstrom, Inc., Case
    IPR2012-00027, slip op. at 7 (PTAB June 11, 2013) (Paper 26)
    (representative). The “prior art of record” includes “any material in the
    prosecution history of the patent,” “any material art of record in the current
    proceeding, including art asserted in grounds on which the Board did not
    institute review,” and “any material art of record in any other proceeding
    before the Office involving the patent.” MasterImage 3D, Inc. v. RealD
    Inc., Case IPR2015-00040, slip op. at 2 (PTAB July 15, 2015) (Paper 42)

    ***Gilyena is for relapsing remitting MS [“RRMS”]. Forbes noted a possible
    game changer as to primary progressive MS, with new results on ocrelizumab [by Roche / Biogen], which
    is a humanized anti-CD20 monoclonal antibody, which targets mature B lymphocytes:

    On Monday [28 Sept 2015], the company disclosed that its experimental multiple sclerosis treatment ocrelizumab has become the first therapy to hit the main endpoint in a large Phase III study for primary progressive MS. This form of the disease accounts for between 10% and 15% of all MS patients, but is devoid of effective therapies.

    As such, ocrelizumab is looking like an increasingly significant future sales growth driver for Roche, capable of generating multi-billion dollar sales on a global basis. In June, the company announced that two Phase III studies in the more common form of relapsing remitting MS had hit their primary and key secondary endpoints. Full data from each of the late-stage trials will be presented at next month’s annual meeting of the European Committee for Treatment and Research in Multiple Sclerosis (ECTRIMS).

    CD-20 immune cells are thought to be a key contributor to myelin and axonal damage in MS.

    Forbes noted that ocrelizumab might compete against Tysabri in the RRMS market :

    In the larger RRMS market, there is a growing consensus that ocrelizumab will gain an initial foothold in second-line patients and compete primarily with Biogen’s Tysabri. Roche’s drug offers comparable efficacy, but what appears to be a notably superior safety profile. Furthermore, while Tysabri is dosed once a month, ocrelizumab is administered twice a year.

    Another monoclonal antibody for MS is alemtuzumab (Lemtrada) which binds to CD52, a protein present on the surface of mature lymphocytes,

    See the story from 14 Nov. 2014 Sanofi’s Lemtrada Wins U.S. Approval to Treat MS which includes the text:

    There are about 10 treatments for relapsing-remitting MS, in a market estimated at $16 billion, including Avonex made by Biogen Idec Inc. and Copaxone from Teva Pharmaceutical Industries Ltd. Multiple sclerosis, a neurological disease that can cause severe disability, affects as many as 350,000 people in the U.S. and is twice as likely to occur in women, according to the National Institute of Neurological Disorders and Stroke.
    Patients receive five infusions of Lemtrada in the first year, followed by three more a year later. Data presented at a meeting in September showed that 70 percent of those involved in the key clinical trials of the drug didn’t require any additional treatment after the first two years. The drug will cost $158,000 over the two years, compared with about $135,000 for Merck KGaA’s Rebif, Sibold said.

    “We could see that this would become the most cost-effective, least-expensive, highest-value product over time,” he said.

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  • Pro se appellant loses at CAFC in In re Steed

    The issue in In re Steed:

    The principal issue on appeal is whether Steed antedated
    the Evans reference in accordance with the requirements
    and law implemented by Rule 131, for Steed
    bears the burden to establish “facts . . . in character and
    weight, as to establish reduction to practice prior to the
    effective date of the reference, or conception of the invention
    prior to the effective date of the reference coupled
    with due diligence from prior to said date to a subsequent
    reduction to practice or to the filing of the application.”
    37 C.F.R. § 1.131(b). Steed argues that the Declaration
    and exhibits meet the requirements of either actual
    reduction to practice or conception plus diligence.

    There was no waiver:

    The Board held that “assertions that the claimed invention
    was actually reduced to practice in December of
    1997, and at the latest by August of 2000 are not set forth
    in the Appeal Brief or the Reply Brief, and are thus
    considered waived.” Bd. Op. at 6. We discern no such
    waiver. To the contrary, the appeal briefs included well
    over a hundred pages of exhibits and arguments, all
    directed to actual reduction to practice. Although the
    Board concluded that the evidence did not establish an
    actual reduction to practice, the issue was not omitted
    from the appeal briefs.
    Steed’s briefs before the Board are clear that Steed
    was attempting to establish conception, diligence, and
    actual reduction to practice. The flaw in Steed’s proofs
    was in the content of the documentary evidence, not in
    any purported waiver. It is beyond debate that Steed was
    attempting to swear back of Evans, and that this was the
    focus of the evidence and argument presented to the
    Examiner and the additional documents and affidavits
    presented to the Board.

    The problem

    We agree that the exhibits are not self-explanatory,
    and the Examiner had adequately warned the applicant,
    stating in the Final Office Action that “most of the notes
    included for the [year] 2000 are all notes to call people
    without actually including what phone calls were being
    made about and what was being accomplished with
    reference to the invention” and “there are 57 months of
    time unaccounted for in applicant’s attempt to show due
    diligence,” among other things. Office Action, Paper No.
    34 at 5–6 (March 3, 2011). In an earlier Office Action, the
    Examiner stated that “Appendix A . . . does not include
    any specifics of the actual invention” and “there are
    significant gaps of time between each of the Appendices
    A-D that amount to entire years of diligence being omitted.”
    Office Action, Paper No. 17 at 3–4 (Dec. 9, 2009).


    We agree with the PTO argument, on this appeal,
    [T]he Board cannot be faulted for not reviewing
    evidence that was not presented to it or to the Examiner.
    To the extent Appellants have better
    proof of an earlier actual reduction to practice or
    conception date, the proper remedy is to file a continuation
    application and present the evidence to
    the Examiner in the first instance.
    PTO Br. 24. We conclude that substantial evidence
    supports the Board’s findings, and the ruling that Steed
    did not establish an actual reduction to practice before the
    Evans effective date of December 23, 2002. That ruling is

    As to conception:

    An inventor can antedate a Section 103 reference by
    showing that the invention was conceived before the
    effective date of the reference, with diligence to actual or
    constructive reduction to practice. 37 C.F.R. § 131(b).
    Conception is “the formation, in the mind of the inventor,
    of a definite and permanent idea of the complete
    and operative invention, as it is thereafter to be applied in
    practice.” Mergenthaler v. Scudder, 11 App. D.C. 264, 276
    (D.C. Cir. 1897); see Coleman v. Dines, 754 F.2d 353, 359
    (Fed. Cir. 1985). The Board found that the evidence that
    Steed provided did not establish conception before the
    Evans effective date, and that Steed did not adequately
    explain the exhibits and how they showed conception of
    the claimed subject matter, or when such conception
    occurred. The Board recognized that the Table “identifies
    that a piece of evidence corresponds to a certain date” but
    criticized the absence of evidence to “explain what fact
    that piece of evidence is meant to support as having
    occurred on that date.” Bd. Op. at 15.


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  • Chaffetz, the Secret Service, and data security

    Various news reports discuss the unauthorized access (and likely disclosure) by Secret Service employees of an unsuccessful employment application to the Secret Service by Republican congressman Jason Chaffetz of Utah, who recently has been investigating bad acts by the Secret Service.

    There are at least two aspects of the disclosure.

    @1. The implication that Chaffetz is somehow “inferior” because his application was turned down.
    @2. The implication that the investigations by Chaffetz of the Secret Service are payback for being turned down, and thus are not objectively based.

    Both aspects are captured in the Washington Post text:

    One official told The Post that the material included a parody poster that pictured Chaffetz leading a hearing on the Secret Service from his congressional dais, with the headline “Got BQA from the Service in 2003.” Within the Secret Service, “BQA” is an acronym meaning that a “better qualified applicant” was available.


    NPR noted:

    Chaffetz told the AP that Homeland Security Secretary Jeh Johnson personally apologized to him. Chaffetz called the experience “intimidating,” saying: “It’s what it was supposed to be.”

    link: Secret Service Violated Privacy Protocol, Wanted To Embarrass Congressman

    As to disclosure of unsuccessful job applications, such disclosure can occur in unexpected ways.
    This author learned in 2001 of a disclosure which had happened in 1987, because of an employment action taken by someone else.

    See the earlier IPBiz post

    Startup Act 2.0: are you turning up your nose at $150K/year jobs?

    Apart from recounting the story of the Dickakian matter [ In the Matter of Exxon Chemical Company (on behalf of Dickakian), 87-INA-615 ], the post mentioned issues with a data breach at LinkedIn:

    “In this job market, I’m just happy the Russians who hacked LinkedIn have my resume,” one guy tweeted.

    “Okay, maybe it’s just me, but if my LinkedIn was hacked… who cares? More people will see my resume?” someone else said.

    In passing, as to Chaffetz, it appears that a number of people have underestimated Chaffetz in the past. It might be that the Secret Service is the one who got it wrong in 2003.

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  • The Trillion-Dollar Technology

    The smartphone is one of the most ubiquitous inventions in contemporary life. Ask anyone from teenagers to senior citizens – in industrialized countries, as well as emerging markets – about the wireless ways of their life, and they will tell you this. But what is the economic impact of mobile? That is not as obvious, writes Antonio Varas.

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  • Innovation in Latin America: the tunnel may still be there, but the light is still burning

    The following report was provided by Felix Rozanski, based in Buenos Aires, who is the Coordinator at the Study Center CEDIQUIFA and Secretary of ASDIN (Intellectual Rights Association).

    The Sixth Annual Latin America Seminar on “The Value of Intellectual Property for Innovation and Health” was recently held at Cayetano Heredia University in Lima, Peru. A varied group of public officials, judges and experts from throughout Latin America gathered to discuss the promotion of innovation, particularly from the perspective of the legal tools offered by patents and other rights available under the intellectual property regime. The process of awareness about the value of innovation and intellectual property can be said to have started in Latin America with the conclusion of the negotiations over the establishment of the World Trade Organization and TRIPs Agreement in 1995, this despite the fact that portions of these arrangements were (and to some extent still are) strongly resisted by many emerging economies. The bilateral trade agreements concluded with the United States after TRIPs, the educational campaign implemented by WIPO, the support provided by the lines of credit made available by the World Bank and the Inter-American Development Bank, as well as lessons learnt from the success of such countries as Israel, South Korea and Singapore, have been key contributory factors.

    It is encouraging to note that a number of Latin American governments are giving explicit recognition to the crucial importance of innovation for increasing competitiveness and promoting growth at the national level. Therefore, although the proportion of investments directed to promoting innovation is still relatively low, the trajectory is positive and at an increasingly higher rate. Thus, it is currently estimated that investment in innovation in the region as a whole is 0.68% of the growth domestic product (GDP) (versus between 2% to 4% in more developed innovative economies). Only Brazil has reached a level of investment of more than 1% of GDP (albeit before its current economic crisis). In particular, the pharmaceutical sector continues being a major actor in private R&D investment. For example, in Chile, R&D in pharma and biotech is at the top of private investment in innovation (14.38%), followed by software (9.86%).

    Still, Latin America continues to wrestle with the problem of how to attract private investment for R&D activities in the region. It is officially estimated that two-thirds of investments in innovation are made by the public sector, while informal estimates suggest that private investment is only about 20% of the total R&D. Regarding how innovation is promoted, each country in the region continues to set its own policies. For example, Peru has approved new tax incentives for R&D investments, effective as of January 1, 2016. Argentina also developed a scheme of providing tax benefits to promote biotech projects, but the law was not implemented. In Chile, research by the public agency CORFO has revealed that R&D-subsidized projects tend to cease as soon as the subsidies come to an end. In Ecuador, an innovative government scheme to hire retired senior experienced researchers to train and help design projects is facing strong headwinds in the face of plummeting international oil prices.

    At the intra-country level, there is little coordination among the relevant national agencies in designing and implementing innovation promotion policies, and often such agencies work at cross purposes. There is even less collaboration among countries in the region; mistakes made in one country may be simply repeated in another. An independent Observer monitoring the processes of innovation in the region may be helpful. Such a proposal was made during the Seminar to the Peruvian representative of the Pacific Alliance Free Trade Agreement, comprising Colombia, Chile, Mexico and Peru. Indeed, the Pacific Alliance may be a good opportunity for more extensive collaborations, but to bring it to fruition both the academic and private sectors will need to be more actively engaged. At the enterprise level, only a few firms with activities across Latin America are involved in innovation. On the whole, private companies in the region still must still work on how to develop an innovation culture. Designing realistic long-term innovation strategies is necessary as is better training of staff to support such efforts. As mentioned, finance for innovation projects continues being scarce and while there are many startups in the region, few can be described as engaged in technology. Still, the forecast is that more Latin American companies will be investing in R&D in the future. 

    As for IP, the biggest challenges are fragmentation at both the intra-national and transnational levels within the region as well inconsistent treatment of IP rights. For instance, regarding incremental inventions, such as new uses, there are substantial differences in the way that Mexico and Brazil deal with them, on the one hand, as compared with Argentina on the other, which provides thin patent protection for pharmaceutical and biotech inventions. Moreover, studies point to the fact that IP rights and the advantages that they offer for innovation and development are still poorly appreciated by public and private researchers in the region. 

    At the most basic level, empirical data indicate that better IP effective protection means more foreign direct investment, which is essential for the region, even more so when growth is slowing. In this vein, the myth that patents work against access to medicines is strongly entrenched. In addition, confusion reigns between the process of patent grant and health-marketing authorization. The result is that there are far too few patents being issued. It is estimated that Latin America registers annually a total of 1,400 national patents. In contrast, a country such as South Korea, with less than 10% of the total Latin American population, registers more than 20 times the number of patents. Against this backdrop, the promotional and educational efforts made by the various national IP agencies should be expanded.

    A particularly interesting panel at the Seminar dealt with compulsory licenses. The panel discussed the regime currently applied in Ecuador, where 33 applications for compulsory licenses of pharmaceutical products have been filed, out of which eight have been withdrawn by the applicants, five refer to patents that have ready already expired, ten have already been granted by the Patent Office, while the rest are in the grant process. In contrast, in other Latin American countries, such as Peru and Colombia, applications for compulsory licenses have been far less successful due to the failure by the applicants to provide sufficient supporting the request. Moreover, the regulatory regime for the compulsory licenses in place in Ecuador (Instruction 10-04 issued by IEPI, the I.P. Agency) is not consistent with international and national legislation, with the result that the granting of compulsory licenses under this provision has the perverse effect of de facto abrogating rights in pharmaceutical patents. In doing so, the end result is to send a negative message to foreign investors as to their property rights in Ecuador.

    As for the protection of test data, the regulations in force in those Latin American countries that do accept test data protection for the registration of pharmaceuticals by the health authorities restrict such protection to new molecules. Here again, there is a contradiction between government efforts to promote innovation while, at the same time, not providing data protection for incremental innovations, which may well make more sense for developing countries than the invention of an entirely new molecule. In this regard, it is noted that Argentina and Brazil do not grant any type of test data protection for pharmaceuticals.

    Overall, the principal take-away from this year’s seminar is that there is much work to do in the region to meet the challenge of attracting more private R&DS investments for innovation.

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  • Board Uses Discretion to Deny Institution of Petition That is Redundant to Prior Petition CBM2015-00039

    Takeaway: The Board may exercise its discretion to deny institution of covered business method patent review where the petitioner cites different prior art references from another proceeding in which it is also a party, but the different prior art references … Continue reading

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  • Institution Denied With Insufficient Evidence of Public Accessibility of Printed Publications IPR2015-00329

    Takeaway: At the institution phase of a proceeding, the Board may accept the presence of a copyright notice, together with the listing of the reference in an IDS, as some evidence of public accessibility as of a particular date. In … Continue reading

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  • Chaffetz on drug price increases before the patent cliff

    As to Congressman Chaffetz, Investors Business Daily noted:

    a group of congressional Democrats sent a letter to Rep. Jason Chaffetz, chair of the House Committee on Oversight and Government Reform, requesting a subpoena to make Valeant turn over documents related to last February’s triple-digit price increases on two heart drugs, Nitropress and Isuprel.

    Link to Investor’s Business Daily article, Valeant Defended After Politics-Induced Sell-Off:

    IBD was somewhat cool on the idea of Chaffetz favorably responding to Democrats, but IPBiz notes Chaffetz is a different type of chairman.

    From realclearpolitics :

    When Chaffetz campaigned to run the committee in the new Congress – Issa was forced to leave because of Republican term limits on chairmanships – the Utah lawmaker ran partially on a platform of taking the committee in a new, less fiery direction, promising improved relationships with Democrats. And in the first six months, the reviews of Chaffetz’s nascent tenure are positive across the board, and across the aisle.

    And Chaffetz gets along well with Elijah Cummings.

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  • CAFC in Achates v. Apple: PTAB determinations as to petitions are final and nonappealable

    The key point:

    Achates contends that the Board’s decisions
    were outside of the Board’s statutory authority because
    the underlying petitions for IPR were time-barred under
    35 U.S.C. § 315(b). As part of its appeal, Achates also
    challenges the Board’s denial of Achates’ motion for
    discovery. See Apple Inc. v. Achates Reference Publ’g, Inc.,
    2013 WL 6514049 (P.T.A.B. Apr. 3, 2013) (“Discovery
    Decision”). Because the Board’s determinations to institute
    IPRs in this case are final and nonappealable under
    35 U.S.C. § 314(d), this court lacks jurisdiction and dismisses
    the appeals.

    The CAFC discussed the relevant law:

    Both IPR and CBMR proceed in two stages. In the
    first stage, the Director determines whether to institute
    IPR or CBMR. By regulation, “[t]he Board institutes the
    trial on behalf of the Director.” 37 C.F.R. § 42.4; see also
    37 C.F.R. §§ 42.100(a) (explaining that IPR proceedings
    are subject to these trial procedures); 42.300(a) (same for
    CBMR). In the second phase, the Board conducts the IPR
    or CBMR proceedings on the merits and issues a final
    written decision.
    Based on the petitions and any responses, the Board
    decides whether there are sufficient grounds to institute
    the proceedings—in IPR petitions there must be a “reasonable
    likelihood” that the petition will prevail, 35
    U.S.C. § 314(a), and in CBMR petitions it must be “more
    likely than not,” 35 U.S.C. § 324(a). An IPR proceeding
    “may not be instituted if the petition requesting the
    proceeding is filed more than 1 year after the date on
    which the petitioner, real party in interest, or privy of the
    petitioner is served with a complaint alleging infringement
    of the patent.” § 315(b). No analogous time-bar
    exists for CBMR proceedings. IPR proceedings are not
    limited to specific types of patents. On the other hand,
    CBMR proceedings are only permitted “for a patent that
    is a covered business method patent.” AIA § 18(a)(1)(E).
    Importantly, identically worded statutory provisions
    make explicit that “[t]he determination by the Director
    whether to institute [IPR or CBMR] under th[ese] section[s]
    shall be final and nonappealable.” See § 314(d)
    and § 324(e), respectively.

    If a proceeding is instituted, the Board considers the
    merits and “issue[s] a final written decision with respect
    to the patentability of any patent claim challenged by the
    petitioner and any new claim added” during the proceedings.
    35 U.S.C. §§ 318(a) (IPR), 328(a) (CBMR).
    “[P]art[ies] dissatisfied with the final written decision of
    the Patent Trial and Appeal Board under section[s]
    [318(a) or 328(a)] may appeal the decision pursuant to
    sections 141 through 144.” Id. §§ 319 (IPR), 329 (CBMR).
    Sections 141 through 144 of title 35 generally explain that
    Board decisions are appealable to this court. Of particular
    relevance, 35 U.S.C. § 141(c) states, with emphasis

    A party to an inter partes review or a post-grant
    review who is dissatisfied with the final written
    decision of the Patent Trial and Appeal Board under
    section 318(a) or 328(a) (as the case may be)
    may appeal the Board’s decision only to the United
    States Court of Appeals for the Federal Circuit.

    The Cuozzo case was mentioned:

    This court also has considered whether the Director’s
    institution decision is subject to review after a final
    written decision by the Board. In In re Cuozzo Speed
    Techs., LLC, 793 F.3d 1268 (Fed. Cir. 2015), the Director
    instituted an IPR of certain claims relying in part on
    references not cited in the petition. On appeal, Cuozzo
    argued that the IPR was improperly instituted because
    the petition-as-filed did not provide “a reasonable likelihood
    that the petition would prevail” as required
    by § 314(a). Id. at 1273. Cuozzo argued that the reviewability
    prohibition of § 314(d) applied only to interlocutory
    appeals, and that the initiation decision becomes available
    for review once the Board issues a final written decision.
    The court disagreed with Cuozzo and declined to
    review the initiation decision, remarking that § 314(d) “is
    not directed to precluding review only before a final
    decision” and cannot be directed only to precluding interlocutory
    appeals because §§ 319 and 141(c) already serve
    that role. Id. The court then recognized that “the IPR
    statute [does not] expressly limit the Board’s authority at
    the final decision stage to the grounds alleged in the IPR
    petition” and that “the failure to cite those references in
    the petition provides no ground for setting aside the final
    decision.” Id. at 1273 and 1274.

    As to CBM review

    The court first recognized the distinction between the
    final merits decision and the initiation decision: “institution
    and invalidation are two distinct actions.” Id. at
    1319. “[I]t is the merits of the final written decision that
    are on appeal; we are not here called upon to review the
    determination by the [Board] whether to institute a CBM
    review, and indeed [35 U.S.C. § 324(e)] expressly instructs
    that we may not.” Id. at 1315. The court went on to
    point out that although the issue of whether a patent is a
    CBM was first determined by the Director at the initiation
    stage, the same issue was necessarily implicated in
    the final merits determination and was appropriate for
    review because of the fundamental limitation of the
    Board’s “ultimate invalidation authority” in a CBMR to
    those patents that meet the CBM definition:
    [O]ne of the limits on § 18 invalidation authority
    is that the patent at issue be a CBM patent. . . . If
    a particular patent is not a CBM patent, there is
    no proper pleading that could be filed to bring it
    within the [Board’s] § 18 authority.
    Id. at 1320. Compare Cuozzo, 793 F.3d at 1274 (“The fact
    that the petition was defective is irrelevant because a
    proper petition could have been drafted.”)

    Cuozzo-like arguments appear:

    Just as the pleading in Cuozzo could have been sufficient by
    the inclusion of the missing prior art reference, see 793
    F.3d at 1274 (“The fact that the petition was defective is
    irrelevant because a proper petition could have been
    drafted.”), the timeliness issue here could have been
    avoided if Apple’s petition had been filed a year earlier or
    if a petition identical to Apple’s were filed by another
    party. This is in contrast to the issue in Versata II, where
    “no proper pleading [] could be filed to bring it within the
    [Board’s] § 18 authority.” 793 F.3d at 1320.

    The words “too crabbed” appear:

    Finally, Achates also contends that § 314(d) does not
    limit this court’s review of the timeliness of Apple’s petition
    under § 315, because § 314(d) says “[t]he determination
    by the Director whether to institute an inter partes
    review under this section shall be final and nonappealable”
    (emphasis added). Achates’ reading is too crabbed
    and is contradicted by this court’s precedent. The words
    “under this section” in § 314 modify the word “institute”
    and proscribe review of the institution determination for
    whatever reason.

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