The Patent Trial and Appeal Board (“PTAB” or “Board”) recently issued guidance on motions to amend in AIA trial proceedings following the Federal Circuit’s en banc decision in Aqua Products, Inc. v. Matal, 872 F.3d 1290 (Fed. Cir. 2017).
Prior to the Federal Circuit’s decision in Aqua Products, the Board placed the burden of persuasion on patent owners to prove patentability of proposed substitute claims presented in a motion to amend in AIA trial proceedings including inter partes review (IPR), post-grant review (PGR) and covered business method (CBM) review. If the Board institutes trial, the patent owner has a statutory right to pursue at least one motion to amend. 35 U.S.C. §§ 316(d), 326(d).
As explained in our recent article, Aqua Products struck down the Board’s practice of placing the burden of persuasion on patent owners to prove patentability of proposed substitute claims. The majority opinion in Aqua Products was limited to the following:
The only legal conclusions that support and define the judgment of the court are: (1) the PTO has not adopted a rule placing the burden of persuasion with respect to the patentability of amended claims on the patent owner that is entitled to deference; and (2) in the absence of anything that might be entitled deference, the PTO may not place that burden on the patentee.
872 F.3d at 1327.
Change in Practice
In view of the above guidance by the Federal Circuit, the Board explained that it “will not place the burden of persuasion on a patent owner with respect to the patentability of substitute claims presented in a motion to amend.” Rather, the Board explained that:
if a patent owner files a motion to amend (or has one pending) and that motion meets the requirements of 35 U.S.C. § 316(d) [or § 326(d)] (i.e., proposes a reasonable number of substitute claims, and the substitute claims do not enlarge scope of the original claims of the patent or introduce new matter), the Board will proceed to determine whether the substitute claims are unpatentable by a preponderance of the evidence based on the entirety of the record, including any opposition made by the petitioner.
Thus, if the “entirety of the evidence of record” before the Board, on balance, does not support a finding that proposed substitute claims are unpatentable, “the Board will grant such claims, and the Office will issue a certificate incorporating those claims into the patent at issue.”
Accordingly, petitioners, not patent owners, have the burden of persuasion to prove unpatentability of substitute claims presented in a motion to amend. Based on the new guidance, it appears that the Board will grant a motion to amend if the petitioner is unsuccessful in showing unpatentability of substitute claims, or the petitioner does not oppose the motion to amend.
Patent Owner’s Burden of Production
Other than placing the burden of persuasion with respect to the patentability of substitute claims on petitioners, “practice and procedure before the Board will not change.” In particular, patent owners have an initial burden of production to meet for motions to amend. The Board emphasized that “a patent owner still must meet the requirements for a motion to amend under 37 C.F.R. § 42.121 or 42.221, as applicable.” Under these rules, a motion to amend must (i) propose a reasonable number of substitute claims (generally one-for-one), (ii) show written description support and support for the benefit of an earlier priority date, if applicable, and (iii) be responsive to grounds of challenge involved in the trial. 37 C.F.R. §§ 42.121, 42.221. A patent owner must also confer with the PTAB before filing a motion to amend. Id.
Patent Owner’s Duty to Disclose
In addition, the Board emphasized that a patent owner’s duty of candor under 37 C.F.R. § 42.11(a) requires the patent owner “to disclose to the Board information that the patent owner is aware of that is material to the patentability of substitute claims, if such information is not already of record in the case.” The Board has explained that in a motion to amend, a patent owner must show a patentable distinction over the prior art of record, and “prior art known to the patent owner,” which includes “no more than the material prior art that Patent Owner makes of record in the current proceeding pursuant to its duty of candor and good faith to the Office under 37 C.F.R. § 42.11, in light of a Motion to Amend.” MasterImage 3D, Inc. v. RealD Inc., IPR2015-00040, Paper 42 at 2-3 (PTAB July 15, 2015) (precedential). The Board’s guidance does not appear to change the requirement set forth in MasterImage that a patent owner must disclose material prior art known to the patent owner and distinguish the proposed substitute claims over the disclosed prior art.
Briefing Practice Remains Unchanged
The Board explained that it will continue its current briefing practice including the timing and page-limits of briefs for motions to amend, as governed by 37 C.F.R. §§ 42.22-42.25. Thus, patent owners seeking to pursue a motion to amend must file it with or in lieu of its patent owner response (Due Date 1), after conferring with the Board.
Addressing the Impact of Aqua Products
Parties are encouraged to contact the Board “if any party in a matter involving a motion to amend believes there is a need to discuss the impact of Aqua Products with the Board in a particular case.” If briefing on a motion to amend has already been presented, the Board invited parties in such cases to contact the Board to request supplemental briefing to address the impact of Aqua Products, if appropriate.
The Board’s new guidance provides insight into how motions to amend will be adjudicated in view of the Aqua Products decision. While the burden of persuasion has shifted from patent owners to petitioners, it appears that patent owners will still have a high burden to show patentability of proposed substitute claims over the prior art of record and any material prior art known to the patent owner.