Law Alert – Amendments in Inter Partes Review (IPR) Proceedings

Federal Circuit Reaffirms USPTO’s Approach to Amendments in IPR Proceedings

Aqua Products appealed from a final decision of the Patent Trial and Appeal Board (“Board”) in an IPR of U.S. Patent No. 8,273,183, denying Aqua Products’ motion to substitute claims. Aqua challenged that the Board inappropriately places the burden on the patentee to demonstrate the amended claims would be patentable over the art of record and that the Board abused its discretion by failing to evaluate objective indicia of non-obviousness and the new limitations in the proposed claims. The court affirmed that the burden belongs on the patentee and held that the Board is only required to address arguments that Aqua Products actually raised in its motion to amend.

In their substituted claims, Aqua Products added 4 new limitations to overcome cited prior art. In Re: Aqua Products, Inc., at 4. However, in its motion to amend Aqua Products only specifically addressed one of these limitations as rendering the substitute claims not obvious in view of the prior art. Id. In denying the motion, the Board addressed only this limitation, stating that it would have been obvious in view of the prior art. Id.

The court noted that under 37 C.F.R. § 42.121 the Board may deny a motion to amend if the amendment expands the claim scope or “does not respond to a ground of patentability involved in the trial.” In Re: Aqua Products, Inc., at 6. As PTO regulations place the burden for any motion on the movant, see 37 C.F.R. § 42.20(c), the Board has interpreted § 42.121 as placing the burden on the patentee to show the proposed amendments would make the claims patentable over the known prior art. Id. The court cited several prior decisions affirming that the burden belongs on the patentee and affirmed that again in this decision. Id.; Microsoft Corp. v. Proxyconn, Inc., 789 F.3d 1292, 130 –1308 (Fed. Cir. 2015); Prolitec, Inc. v. ScentAir Techs., Inc., 807 F.3d 1353, 1363 (Fed. Cir. 2015); Nike, Inc. v. Adidas AG, 812 F.3d 1326, 1333–1334 (Fed. Cir. 2016).

In addressing whether the Board abused its discretion by failing to address the additional limitations Aqua Products added in its proposed claims, the court held that the Board is only required to address the arguments which Aqua Products actually raised. In Re: Aqua Products, Inc., at 6 – 7. Aqua Products argued that the Board was “on notice” of the additional limitations as they were referenced throughout the proceeding. Id. at 7.  The court held that as these additional limitations were not referenced in the motion to amend to explain why the substitute claims were not obvious in view of the prior art, the Board was under no obligation to consider them in evaluating the motion to amend. Id. The court reasoned that requiring the Board to consider arguments not brought in support of patentability would require the Board to fully reexamine the proposed claims in the first instance, effectively shifting the burden from the patentee to the Board. Id. The Board is only required to show that it fully considered the particular arguments raised by the patentee and that it provided a reasoned explanation for why those arguments were unpersuasive. Id. The court found that those requirements were satisfied here. Id.

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