Most practitioners challenging patents before the Patent Trial and Appeals Board (“PTAB”) have learned the importance of filing an ironclad petition. A flawed petition will likely result in the PTAB refusing to institute a trial—an increasingly common occurrence (at least in the inter partes review (“IPR”) context).1 Even if the PTAB does institute a trial, however, a flawed petition can still be fatal.2 If the petitioner later discovers that the petition failed to include all arguments that ultimately prove necessary to demonstrate unpatentability, there is no sure remedy available: the PTAB’s rules explicitly forbid raising new arguments in reply briefs.3 Faced with the possibility of an adverse final written decision, some petitioners map attempt to raise new arguments on reply despite the PTAB’s rules. The patent owner is then faced with deciding what remedy to seek from the PTAB, and how best to seek that remedy. Although the specific approach between PTAB panels varies, the PTAB may wait to decide whether an argument raised in reply is new until it issues its final written decision.4 This overarching “wait and see” approach can inject uncertainty into the final stages of the trial.
Motions to strike. The PTAB will typically not grant a patent owner permission to file a motion to strike,5 and will often note an absence of “special circumstances.”6 Instead, the PTAB will typically give the patent owner permission to attack new arguments in one of two ways: (1) giving the patent owner permission to file a sur-reply, or (2) giving the patent owner permission to file a document identifying the new arguments.
Sur-replies. The PTAB frequently grants patent owners’ requests to file sur-replies. In addition to specifying a page limit (usually ranging between three and ten pages),7 the PTAB will often—but not always 8 —give the petitioner a chance to respond (characterized as a “sur-sur-reply” or a “response”).9 The PTAB will also typically explicitly forbid the petitioner from submitting new evidence in the sur-reply.10
Identifications. The PTAB also frequently grants patent owners permission to file documents specifically identifying the new arguments raised in the petitioner’s reply. Sometimes, the PTAB authorizes identifications in lieu of a patent owner’s request to file a sur-reply or a motion to strike.11 The identification must typically identify the new argument by exhibit, page, and line number. Some panels allow the patent owner to provide a brief explanation as to why the arguments are allegedly new,12 while other panels explicitly forbid any argument in the identification.13 The PTAB will typically also allow the petitioner to file a response to the identification.14
In conclusion, different panels take different approaches on addressing allegations of new arguments raised in the petitioner’s reply. The two prevailing approaches—allowing the patent owner to file a sur-reply or an identification—typically leave the issue unresolved until the PTAB issues a final written decision. As a result, parties facing this issue must often be prepared to address it at oral argument—taking time and resources away from arguments on the merits.
1The institution rate for IPR petitions has declined every year since they were first authorized by statute in 2013. See UNITED STATES PATENT AND TRADEMARK OFFICE, DEP’T OF COMMERCE, TRIAL STATISTICS, IPR, PGR, CBM (Feb. 2018), available at https://www.uspto.gov/sites/default/files/documents/trial_statistics_20180228.pdf (showing institution rates of 87% in 2013, 75% in 2014, 68% in 2015, 67% in 2016, 63% in 2017, and 62% in 2018).
2Given the statutory bars on the timing for the filing of petitions, a flawed petition may be fatal to not only the specific proceeding, but to any further challenge to the patent in the PTAB. See, e.g., 35 U.S.C. § 315(a), (b). The flawed petition may also limit the invalidity arguments that the petitioner can raise in any related district court litigation. See, e.g., id. § 315(e)(2).
337 C.F.R. § 42.23(b).
4See, e.g., Apple, Inc. v. Cal. Inst. of Tech., IPR2017-00210, 2018 WL 1010584 (PTAB Feb. 20, 2018) (Paper 51); EMC Corp. v. Intellectual Ventures I LLC, IPR2017-00374, 2018 WL 931300 (PTAB Feb. 14, 2018) (Paper 37); Netapp, Inc. v. Intellectual Ventures I LLC, IPR2017-00276, 2018 WL 792191 (PTAB Feb. 8, 2018) (Paper 27).
5See, e.g., Apple, Inc., 2018 WL 1010584; EMC Corp., 2018 WL 931300; Netapp, Inc., 2018 WL 792191; but see Lexicon Med., LLC v. Sugiquest, Inc., IPR2017-00518, 2018 WL 1151890 (PTAB Mar. 2, 2018) (Paper 21) (allowing the patent owner to file a motion to strike or a sur-reply); Juniper Networks, Inc. v. ChiriMar Sys., Inc., IPR2016-01389, 2018 WL 557893, at *42 (PTAB Jan. 23, 2018) (Paper 69) (noting that the PTAB had previously authorized the patent owner to file a motion to strike new arguments raised in reply, and denying a motion to exclude seeking the same relief).
6See, e.g., One World Techs., Inc. v. Chamberlain Grp., Inc., IPR2017-00073, 2017 WL 635422, at *3 (PTAB Dec. 11, 2017) (Paper 19); FLIR Sys., Inc. v. Garmin Switzerland GmbH, IPR2017-00946, 2018 WL 1240362 (PTAB Mar. 8, 2018) (Paper 33).
7See, e.g., Apple Inc., 2018 WL 1010584 (seven pages); Coastal Indus., Inc. v. Shower Enclosures Am., Inc., IPR2017-00573, 2018 WL 557901 (PTAB Jan. 23, 2018) (Paper 21) (five pages); Dish Network Corp. v. Customedia Techs., L.L.C., CBM2017-00019, 2018 WL 896014 (PTAB Feb. 13, 2018) (Paper 39) (five pages); Google LLC v. Blackberry Ltd., IPR2017-00912, 2018 WL 1960555 (PTAB Apr. 24, 2018) (Paper 22) (three pages); but see Deliphi Techs., Inc. v. Microchip Tech. Inc., IPR2017-00861, 2018 WL 1216790 (PTAB Mar. 6, 2018) (Paper 29) (12 pages).
8See, e.g., Google LLC, 2018 WL 1960555.
9See, e.g., Deliphi Techs., Inc., 2018 WL 1216790; Dish Network Corp., 2018 WL 896014; Infobionic, Inc. v. Braemar Mfg., LLC, IPR2017-00796, 2018 WL 1444571 (PTAB Mar. 21, 2018) (Paper 21).
10See, e.g., Apple Inc., 2018 WL 1010584; Deliphi Techs., Inc., 2018 WL 1216790; Dish Network Corp., 2018 WL 896014; but see Coastal Indus., Inc., 2018 WL 557901.
11See, e.g., EMC Corp., IPR2017-00374; Fujifilm Corp. v. Sony Corp., IPR2017-00360, 2018 WL 565829 (PTAB Jan. 24, 2018) (Paper 24); Netapp, Inc., 2018 WL 792191.
12See, e.g., EMC Corp., IPR2017-00374; Fredman Bros. Furniture Co., Inc. v. Bedgear, LLC, IPR2017-00350, 2018 WL 930966 (PTAB Feb. 16, 2018) (Paper 29); Netapp, Inc., 2018 WL 792191.
13See, e.g., Fujifilm Corp., 2018 WL 565829; One World Techs., Inc., 2017 WL 635422.
14See, e.g., EMC Corp., IPR2017-00374; Fujifilm Corp., 2018 WL 565829; Netapp, Inc., 2018 WL 792191.
ABOUT BAKER BOTTS L.L.P.
Baker Botts is an international law firm of approximately 700 lawyers practicing throughout a network of 13 offices around the globe. Based on our experience and knowledge of our clients' industries, we are recognized as a leading firm in the energy, technology, and life sciences sectors. Since 1840, we have provided creative and effective legal solutions for our clients while demonstrating an unrelenting commitment to excellence. For more information, please visit bakerbotts.com.