© 2015 Fox Rothschild Inter Partes Review Lessons Learned Scott R. Bialecki Fox Rothschild LLP June...

© 2015 Fox Rothschild

Inter Partes Review Lessons Learned

Scott R. Bialecki

Fox Rothschild LLP

June 24, 2015

The 10,000 Foot View

• Inter Partes Review (“IPR”) is a relatively new procedure under the AIA for challenging patent validity at the USPTO.

• Considered to be faster and have a better success rate than previous options.

• Only based on prior art patents or printed publications.

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Inter PartesReview District Court

Decided By PTAB panel Judge/Jury

Timing 1.5 years 1.5 – 4 years

Burden of Proof

Preponderance of the evidence

Clear and convincing evidence

Claim Construction

Standard

Broadestreasonable

interpretation

Construe to maintain validity

IPR vs. District Court

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Inter Partes Review Ex Parte Reexam

Decided By PTAB Panel Patent Examiner

Timing 1.5 years3 mos. to institute/No final deadline

Basis for Instituting

Reasonable likelihood of success for at least 1

claim

Substantial new question of patentability

EstoppelRaised or could

reasonably have been raised

None

ParticipationThroughout process/ right to appeal final

decision

Limited to initial filing/no right to appeal final decision

BasisPatents & printed

publicationsSame

IPR vs. Ex Parte Reexam

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3 months

3 months

7 months

No more than 12 months*

*Possible 6-month extension

No more than 6 months

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Timing

WHEN:

IF IN LITIGATION, YOU MUST FILE IPR PETITION WITHIN 1 YEAR OF COMPLAINT.

Follow the Five Month Rule.

PTAB makes institution decisions within 6 months.

Five Month Rule leaves a 1 month turnaround.

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Fees Can Add Up Quickly

Petition $9,000 + $200 for each claim over 20.(Non-refundable if petition denied)

$14,000 + $400 for each claim over 15.(Refundable if petition is denied)

Min USPTO Filing Fee = $23,000

Institution

+

Attorneys’ Fees

+

617 Petitions Filed (as of 1/15/15)9,048 Claims Challenged

68% of Claims Challenged Were Instituted

32% of Claims Challenged Were Not Instituted

Source: USPTO IPR Statistics (as of 1/15/15)

51% of Claims Instituted Did Not Survive IPR

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What We’ve Learned: Estoppel

Q: What counts as “could have raised”?

A: This includes “prior art which a skilled searcher conducting a diligent search reasonably could have been expected to discover.”

IPR2015-00549, Dkt. 10, at 5.

Concept: Estoppel applies only for grounds that petitioner raised or reasonably could have raised.

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Practice Pointer:Estoppel

• Star Envirotech, Inc. v. Redline Detection, LLC, Case No. SACV 12-01861 JGB (DFMx) (C.D.Cal. 1/29/15)– Instruction manual case– LeakMaster A240 smoke machine

• “locating a heating element within a closed smoke producing chamber”

• TIP: Make sure to analyze manuals relating to devices to avoid estoppel issue

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What We’ve Learned: Estoppel Cont’d

Q: What counts as a “final written decision”?

A: This does not include denial of a petition for institution. It only applies to the PTAB’s decisions after institution.

35 U.S.C. §§ 315(e)(2) and 318(a)

Concept: Estoppel applies only if there was a final written decision.

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What We’ve Learned: Incorporation By Reference

“The footnotes cite a total of seventeen pages, including eleven pages of claim charts, of Dr. Roy’s Declaration—substantially more pages than section VII-A in the Petition. . . . The practice, here, of using footnotes to cite large portions of another document, without sufficient explanation of those portions, amounts to [an improper] incorporation by reference.”

IPR2014-00454, Dkt. 12, at 7-8.

Concept: The PTAB follows a strict 60-page, double-space, 14 pt. font rule. Petitioners who try to skirt this rule by incorporating exhibits by reference risk getting their petitions bounced.

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What We’ve Learned: Staying District Court Litigation

Q: What are ways to increase chances of a stay?

A: You have a better chance of a stay if:• You ask for it after the IPR is instituted;• All patents, claims, and parties are involved in the

IPR; and/or• You can show minimal prejudice to opposing side.

Concept: Staying District Court litigation is not guaranteed, so proceed with caution.

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4 Revised IPR RulesEffective May 19, 2015

• Page Limits in Patent Owner’s Motion to Amend– 25 pages (up from 15) / Opposition has same 25 page limit– Proposed amended claims can be presented in appendix

• Petitioner Reply Brief Page Limit– 25 Pages (up from 15)

• Easier now to respond to Patent Owner Response brief of 60 pages

• Required Font– Font games are over: 14-point, Times New Roman

• Multiple Back-Up Counsel Allowed

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The Fight Against Hedge Funds

• Abuse of IPR Process– Motion for Sanctions briefing moving forward

• Bass and related companies “abusing IPR process for private financial gain”; 37 C.F.R.§§ 42.12(a)(6), b(8)

• Celgene Corp., IPR2015-01102 (Jun. 9, 2015)

• Fail to Disclose All Investors: Real Parties-In-Interest– Motion for Additional RPI Discovery

• NPS Pharmaceuticals Inc., IPR2015-00990 (Jun. 3, 2015)

– Preliminary Response Arguing Failure to Disclose RPIs

• Acorda Therapeutics, IPR2015-00720 (May 26, 2015)

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Questions?

Fox Rothschild LLP

Scott R. Bialecki

sbialecki@foxrothschild.com

(303) 446-3851