Inter Partes Review

An inter partes review is a litigation proceeding brought before the Patent Trial and Appeal Board (“PTAB”) to challenge the patentability of claims in a patent.  A successful inter partes review can cause cancellation of the patent claims so as to prevent future assertion of these claims, wiping out any pending verdict related to these claims and preventing the patent owner from seeking additional claims that are not patentably distinct from those claims found to be unpatentable.  The challenge to patentability in an inter partes review can be based only on the theory that the claims are anticipated or rendered obvious by one or more prior art patents or printed publications.

Availability – Unlike the limits placed on the old inter partes reexamination procedure, an inter partes review may be brought against any patent. Parties in litigation charged with patent infringement have a time limit that must be taken into account when planning litigation strategy: an inter partes review must be filed within one year after being served with the complaint.

Certain circumstances may allow for a defendant to bring an inter partes review even after one year. If another party brings an inter partes review, it can be possible to file a petition for an inter partes review beyond the one-year time limit. If the PTAB agrees to institute a first inter partes review, the PTAB is authorized to join a second inter partes review with the first one without regard to the one-year limit.

An inter partes review petition cannot be filed after filing a declaratory judgment action asserting invalidity of the patent. Nevertheless, such a declaratory judgment can be filed the same day or any day after the inter partes review has been filed. Although an inter partes review petition has the effect of automatically staying the declaratory judgment action, nevertheless by filing the declaratory judgment action, the patent challenger has achieved the goal of making a choice of forum, perhaps in the challenger’s home court.  If the patent owner pursues its patent infringement claim in court, the automatic stay is lifted. An alternative approach to getting into court and filing an inter partes review is for the challenger to lead off with a declaratory judgment action that is limited in scope to asserting non-infringement of the patent, leaving invalidity to the inter partes review proceeding or for later assertion in answer to a counterclaim.

For patents subject to the first-to-file provisions of the America Invents Act, the first nine months after issuance the patent may be subjected to a post-grant review. An inter partes review may not be filed until after these first nine months and only if a post-grant review has not been instituted. If a post-grant review has been requested but not yet instituted, the petition for inter partes review can be filed in the short period between the end of the nine months and the decision from the PTAB instituting the post-grant review.

Estoppel – A successful inter partes review can invalidate one or more claims of a patent. Once all appeals are exhausted a certificate issues canceling any claim determined to be unpatentable. Current case law suggests that the inter partes review certificate will impact any litigation still pending involving the patent claims that are canceled or amended, regardless of the stage of the litigation, potentially undoing jury verdicts and court awards, even those approved on appeal. In the US Patent and Trademark Office, the adverse decision can take effect sooner. Upon issuance of a final written decision from the PTAB, 37 C.F.R. §42.73(d)(3) provides that the patent owner may not obtain “a claim that is not patentably distinct from a finally refused or canceled claim.” Thus, the final written decision can have an immediate effect on patent owner’s continuation strategies in the USPTO.

An unsuccessful inter partes review has estoppel effect upon issuance of the final written decision of the PTAB confirming the patentability of one or more challenged patent claims. The estoppel effect is on a claim-by-claim basis. A petitioner may not thereafter challenge a surviving patent claim on any ground that was raised or reasonably could have been raised during the inter partes review. A great deal of uncertainty surrounds the meaning of “reasonably could have been raised,” and practitioners anxiously await the involvement of the courts in setting forth a predictable meaning for this term. The unsuccessful petitioner’s recourse is to appeal the PTAB decision to the Federal Circuit Court of Appeals in hopes of getting a reversal that lifts the estoppel.

This flowchart shows a comprehensive timeline of deadlines in IPR proceedings that guides the reader from before the filing of a petition for an IPR all the way to the appeals process after conclusion of an IPR.

Petition for Inter Partes Review – A solid petition for inter partes review requires the technical rigor and exhaustive thoroughness of a reexamination request and the legal analysis and advocacy of a claim construction brief. Preparing such a petition draws upon skills both developed in patent reexamination practice as well as attained through years of patent litigation. The petition is limited to 14,000 words. There are a variety of strategies for satisfying this restriction. One approach is to focus only on specific claims of concern. When there are too many claims requiring challenge, another approach is to file two inter partes reviews, each attacking a different set of claims. A claim chart may be included as part of an expert declaration, and therefore outside of the word-count limit. Nevertheless, the arguments against all the claims must be present in the petition itself.

The petition for inter partes review must set forth each ground of rejection against each challenged claim. The PTAB encourages petitioners to focus their petitions on a limited set of grounds for rejection, each of which has a strength not shared by the other rejections being raised.

The PTAB applies the broadest reasonable construction to the patent claims. The petition is the challenger’s only chance to influence the claim construction prior to the decision on whether to institute the inter partes review. Therefore, it is often recommended to provide a fully supported claim construction argument with regard to specific claim limitations.

Patent Owner Preliminary Response – The patent owner has the option of filing a preliminary response to the petition. This response may attempt to persuade the PTAB not to go forward with the inter partes review on all or any portion of the grounds raised in the petition. In deciding whether to file a preliminary response, the patent owner must consider issues of timing and estoppel. For example, as for timing, if petitioner is alerted to correctable errors in the petition, it may be able to file a new inter partes review, if warned before expiration of the one-year deadline from service of a complaint, if applicable.  As for estoppel, a refusal to institute an inter partes review does not carry estoppel effect; estoppel is established only by the final written decision at the conclusion of an inter partes review. Therefore, under certain circumstances it may be preferable to allow the inter partes review to be instituted. Furthermore, it may be tactically preferred to conceal one’s arguments as long as possible and not file a preliminary response so that the petitioner has less time to develop its rebuttal arguments.

The contents of a preliminary response are limited. While the patent owner may cancel claims in an attempt to eliminate the need and prospects for an inter partes review, claims may not be amended at this stage. An expert declaration may be submitted, but any factual disputes raised will be viewed in the light most favorable to petitioner when determining whether to institute. Therefore, the patent owner is well advised to target legal issues such as omissions in the petition, claim construction and the petitioner’s standing to bring the petition in view of deadlines or estoppel. One advantage of a preliminary response is that it is the last word. The petitioner has no opportunity to respond before the PTAB makes its decision on whether to institute the inter partes review.

Institution of the Inter Partes Review – Within three months after the preliminary response or notice of waiver of the preliminary response, the PTAB will issue a decision whether to institute the inter partes review and, in the event of an affirmative decision, which grounds present a reasonable likelihood of prevailing. If the inter partes review is refused in its entirety, the petitioner has 30 days within which to request a rehearing. Because there is no opportunity for further appeal and the decision not to institute carries no estoppel effect, if time permits, an unsuccessful petitioner may choose to bolster its arguments and file a new inter partes review.

The PTAB will frequently institute an inter partes review in response to a petition seeking such review, while rejecting certain ones of the asserted grounds. The petitioner has only 14 days thereafter within which to request a rehearing on the denied grounds. But, little harm may have been done since courts generally allow grounds refused consideration by the PTAB to be raised later in court.  The estoppel effect of a final written decision in an inter partes review according to statute extends only to grounds which were raised or which reasonably could have been raised during that inter partes review.

Trial – Not later than one year after institution of an inter partes review, the PTAB will issue its final written decision. (An extension of up to six months is possible if good cause is shown.) As a result of this short schedule, the proceedings leading up to a hearing are streamlined. The judges assigned to an inter partes review take an active role in moving the case forward to its hearing. The filing of a motion requires prior authorization from the assigned PTAB panel, so teleconferences with the judges are made readily available during the proceeding.

Discovery is available but is strictly limited. Routine discovery includes taking depositions of the other side’s declarants and production of relevant information inconsistent with a position advanced during the inter partes review. Additional discovery requires approval from the judges and generally needs to be targeted at specific relevant information. Fishing expeditions will not be permitted by the PTAB.

The patent owner conducts discovery first, in preparation for filing its response within three months after institution of the inter partes review. The patent owner may also move to amend one or more of the claims being challenged. Amendments are generally restricted to a one-for-one substitution for a challenged claim.  The PTAB’s strict limits on amendments may make approval of the motion to amend difficult. The assigned panel of judges may require a demonstration that the amended claims address the rejection of the pending claim as well as overcome prior art not relied on in the proceeding. The discovery period allotted to the petitioner will typically be less than three months following the patent owner’s response. The patent owner does not have an automatic right to a sur-reply brief, but might choose to cross-examine petitioner’s reply declarant, if any, in a deposition. The patent owner then may move to file observations drawing attention to relevant testimony in the deposition. Motions to exclude testimony may also be filed in this period following the filing of the briefs.

An oral argument in the inter partes review is conducted before the three assigned administrative patent judges. Live testimony from a witness will be rare, limited to a circumstance in which the Board considers the demeanor of the witness critical to assessing credibility.

Conclusion – Inter partes review is a powerful tool for obtaining a rapid review of claims of a patent based on prior art, but its power can be deployed only through filings that implement well-planned strategic goals that reflect the nature of the proceeding and the situation of the parties vis-à-vis the patent in question.