The Patent Trial and Appeal Board (“the Board”) recently provided guidance to practitioners on its discretion to deny institution under 35 U.S.C. § 325(d) and § 314(a) by designating three decisions as informative or precedential. Under 35 U.S.C. § 325(d), the Board may deny institution of inter partes review (“IPR”) because “the same or substantially the same prior art or arguments previously were presented to the Office.” Advanced Bionics, LLC v. MED-EL Elektromedizinische Geräte GmbH, IPR2019-01469, Paper 6 (PTAB Feb. 13, 2020) (precedential), Oticon Med. AB v. Cochlear Ltd., IPR2019-00975, Paper 15 (PTAB Oct. 16, 2019) (precedential), and PUMA N. Am., Inc. v. NIKE, Inc., IPR2019-01042, Paper 10 (PTAB Oct. 31, 2019) (informative) all provide guidance related to § 325(d). Under 35 U.S.C. § 314(a), the Board may deny institution as an exercise of its discretion in certain circumstances, such as when parallel proceedings are underway. In Oticon, the Board also addressed the parallel proceedings issue under § 314(a).
In Advanced Bionics, the Board denied institution under § 325(d), set forth a two-part framework for applying § 325(d), and explained how the factors from Becton, Dickinson & Co. v. B. Braun Melsungen AG, IPR2017-01586, Paper 8 (Dec. 15, 2017) (precedential as to § III.C.5, first paragraph) (“Becton, Dickinson”) fit into the two-part framework.
In Oticon, however, the Board refused to exercise its discretion under § 325(d) and instituted the proceeding over similar arguments by a patent owner. While it did not characterize the § 325(d) inquiry as a two-part analysis, and it grouped the Becton, Dickinson factors into three categories, the Board focused on the same two issues: (1) whether the same or substantially similar prior art and arguments were previously considered, and (2) whether the Patent Office erred in its prior assessment of the art. The Board also rejected a request to deny institution under § 314(a) and distinguished an earlier precedential ruling, NHK Spring Co. v. Intri-Plex Techs., Inc., IPR2018-00752, slip op. at 19–20 (PTAB Sept. 12, 2018) (Paper 8) (precedential) (“NHK”), in which institution was denied because of a parallel district court proceeding.
In PUMA, the Board denied institution under § 325(d) after analyzing the Becton, Dickinson factors and finding the same prior art was previously considered and the petitioner did not persuasively demonstrate the examiner materially erred in evaluating the prior art during prosecution.
This is a longer read, but worthwhile, given the importance of the issues. As detailed in the following summaries, the rulings collectively show the fact-specific nature of the § 325(d) and § 314(a) inquiries. The Board will assess the prior-art teachings considered in prosecution and earlier Board proceedings, will compare those to the teachings asserted in the petition, will carefully compare the disclosures of supposedly duplicative prior art, and will assess the issues and progress of parallel district court cases. Litigants should be prepared for this level of scrutiny and establish the needed records on the prior art teachings and parallel district court cases.
Advanced Bionics, LLC v. MED-EL Elektromedizinische Geräte GmbH, IPR2019-01469 (Precedential)
In Advanced Bionics, the Board denied institution of IPR of a patent related to implantable medical devices (U.S. Patent No. 8,634,909). IPR2019-01469, Paper 6 at 2. Petitioner Advanced Bionics asserted two grounds under 35 U.S.C. § 103(a), but the Board only addressed § 325(d). First, the Board set forth a “two-part framework” for applying § 325(d):
(1) whether the same or substantially the same art previously was presented to the Office or whether the same or substantially the same arguments previously were presented to the Office; and (2) if either condition of first part of the framework is satisfied, whether the petitioner has demonstrated that the Office erred in a manner material to the patentability of challenged claims.
Id. at 8. The Board explained that, if the condition in part one is satisfied and the petitioner fails to demonstrate that the Office materially erred, then the IPR will generally not be instituted. Id. at 8-9. In contrast, “[i]f reasonable minds can disagree regarding the purported treatment of the art or arguments,” then part two of the framework is not satisfied because “it cannot be said that the Office erred in a manner material to patentability.” Id. at 9. “[T]his framework reflects a commitment to defer to previous Office evaluations of the evidence of record unless material error is shown.” Id.
Next, the Board assessed how the Becton, Dickinson factors can be helpful in applying the two-part framework. Factors (a), (b), and (d), used to assess part one, “should be read broadly . . . to apply to any situation in which a petition relies on the same or substantially the same art or arguments previously presented to the Office,” including, for example, during prosecution or prior AIA proceedings. Id. at 10. If part one is satisfied, then part two, regarding whether the Office erred in a manner material to patentability of the challenged claims, is assessed using factors (c), (e) and (f). Id.
Here, asserted grounds 1 and 2 relied on Zimmerling, which was evaluated by the Examiner during prosecution, in combination with Charvin, Chang, and/or Schmid, which were not. Id. at 13. Petitioner asserted that Zimmerling disclosed most claim limitations, and Charvin, Chang, or Schmid disclosed the remainder. Id. at 14. But the Board found that Petitioner relied on Charvin, Chang, and Schmid in the same manner that the Examiner relied on Zimmerling during prosecution for disclosure of those limitations. Id. at 14. The Board therefore found there were no “significant and material differences between the prior art asserted in this Petition and the prior art evaluated during prosecution” and that the prior art in Grounds 1 and 2 were the “same or substantially the same prior art that was previously presented to the Office.” Id. at 16, 19.
Regarding part two of the framework, the Board found that Zimmerling contained the limitations alleged to be disclosed by Charvin and Schmid, and the existence of the limitations in these additional references therefore did not persuasively demonstrate that the Examiner erred in a manner material to the patentability of challenged claims. Id. at 22. Accordingly, the Board exercised its discretion to deny institution under § 325(d).
Oticon Med. AB v. Cochlear Ltd., IPR 2019-00975 (Precedential)
In Oticon, Oticon sought IPR of a Cochlear patent related to anchors for bone-anchored hearing devices (U.S. Patent No. 9,838,807) based on 4 obviousness grounds. Cochlear asked the Board to deny institution under § 325(d) because the Patent Office supposedly considered the same or cumulative prior art during prosecution, the obviousness arguments overlapped, and Oticon failed to show the examiner erred. The Board disagreed and instituted the proceeding.
All four obviousness combinations included a reference (Choi) that was not considered during prosecution, which Oticon argued was duplicative of considered prior art (Härle). Id. at 10. The issue turned on the supposed disclosures of a claimed “circumferential groove” from (1) Choi’s multi-part dental implants having a “settling portion” with “a number of minute screwed grooves,” id. at 12; and (2) Härle’s bone screws with a threaded section having “grooves” and an intermediate “breakage” section that was more prone to break when stressed. Id. at 13. Oticon claimed Choi’s “settling portion” corresponded to Härle’s grooves or breakage portion, making the references cumulative. According to the Board, however, the components were “different structures that serve[d] different purposes.” Id. at 15. Choi’s settling portion was wide and sat in the bone, while Härle’s grooves and breakage portion were narrower and spaced apart from the bone. The functions also differed: the Härle grooves drove the implant into bone; the Härle breakage portion was meant to break before other sections; Choi’s settling portion dispersed bone stress and prevented bone resorption. Because Choi was not cumulative or previously considered, but addressed similar problems as the claims, the Board quickly determined similar arguments were not addressed by the examiner, which was erroneous. Id. at 19-20.
The Board also refused to exercise discretion under § 314(a). Cochlear argued for discretionary denial because the petition was filed almost a year after a co-pending district court case, the delay led to tactical advantages (Oticon addressed a flaw in its district-court invalidity case), Oticon supposedly sought merely to stall the court case with the IPR, and the Board should conserve its resources given the progress of the district court case. Cochlear relied on NHK, in which the advanced state of a parallel district court case weighed in favor of a discretionary denial. The Oticon Board was not convinced: the petition in Oticon was timely filed; while Oticon benefited from the invalidity pleadings in district court, the cases were not duplicative; there was no evidence that Oticon tried to stall the court case; and with the court case only in discovery, there was no need to preserve Board resources. Id. at 22-24. The Board contrasted NHK, in which proceedings were duplicative and the court trial would occur only six months from institution. Id. at 23.
The Board then assessed the four obviousness grounds in detail and easily found that Oticon adequately showed the claim elements were disclosed in the prior art, noting Cochlear did not separately argue otherwise. See id. at 27, 28, 29, 32, 33, 35, 37, 39. The Board further noted that skilled artisans would have been motivated to combine the references, see, e.g., id. at 29, 33, 37, and the secondary-considerations record was incomplete and would be assessed in its final decision, id. at 31. The petition was instituted on all grounds.
PUMA N. Am., Inc. v. NIKE, Inc., IPR2019-01042 (Informative)
In PUMA, petitioner PUMA challenged claims 1-6 of a patent related to footwear (U.S. Patent No. 9,314,065) as being obvious over prior art references, Anderton and Auger, but the Board exercised its discretion under 35 U.S.C. § 325(d) and denied institution of IPR. Id. at 2, 6. The Board considered each of the Becton, Dickinson factors and found that the Examiner previously considered the same Anderton and Auger references during prosecution and Petitioner did not demonstrate that the Examiner erred in a manner material to the patentability of the challenged claims. Id. at 21.
Because the same Anderton and Auger references were relied on by Petitioner and by the Examiner during prosecution, the Board found factor (a) weighed in favor of exercising discretion to deny institution. Id. at 10. According to the Board, factor (b) was neutral because the references asserted in the Petition and during prosecution were identical, and factor (c) weighed in favor of exercising discretion to deny institution because the challenged claims were twice rejected during prosecution over the Anderton and Auger references asserted in the Petition. Id. at 11. For factor (d), the Board found a “high degree of overlap” between Petitioner and the Examiner’s arguments, which weighed in favor of exercising discretion to deny institution. Id. at 12.
Next, the Board considered factor (e) and found it weighed in factor of exercising discretion to deny institution because Petitioner did not demonstrate that the Examiner erred. Id. at 14, 19. First, Petitioner asserted the Examiner erred by allowing the claims because a skilled artisan would have known how to implement a particular modification of the prior art to reach the claimed limitation. But the Board found that the Examiner had already considered whether it would have been obvious to make this modification for the same reason that Petitioner proposed, and Petitioner did not articulate how the Examiner erred. Id. at 16. Second, Petitioner relied on expert testimony to assert that certain limitations were a matter of design choice known to skilled artisans. Id. at 17. The Board found, however, that Petitioner’s expert’s testimony conflicted with the prosecution history and failed to provide any fact-based reasoning to support this statement or any reason why a skilled artisan would be motivated to make the design choice. Id. at 17-19.
Finally, the Board found that factor (f) weighed in favor of exercising discretion to deny institution because the additional evidence that was not before the Examiner, Petitioner’s expert’s declaration, was irrelevant and contradicted the prosecution history. Id. at 20.
In sum, the Board held the “Becton Dickinson factors as a whole weigh heavily in favor” of denying institution of IPR. Id. at 21.
 Factors include: (a) the similarities and material differences between the asserted art and the prior art involved during examination; (b) the cumulative nature of the asserted art and the prior art evaluated during examination; (c) the extent to which the asserted art was evaluated during examination, including whether the prior art was the basis for rejection; (d) the extent of the overlap between the arguments made during examination and the manner in which petitioner relies on the prior art; (e) whether petitioner has pointed out sufficiently how the examiner erred in its evaluation of the asserted prior art; and (f) the extent to which additional evidence and facts presented in the petition warrant reconsideration of the prior art or arguments. Id. at n.10 (citing Becton, Dickinson, Paper 8 at 17-18 (§ III.C.5, first paragraph)).