News & Events

March 29, 2019

Now More than Ever, Petitioners and Patent Owners Must Consider the Impact of Amendments in IPR

by Steven R. Katz

A patent does not ordinarily change claim scope right before trial.  The patent claims at the start of case are the claims that must be proven invalid or shown not to be infringed.  However, if a defendant places the patent into inter partes review (IPR), the patent owner may try to amend the patent, both to save the patent from invalidity, and to make the patent harder to invalidate in District Court.

The United States Patent and Trademark Office has received considerable criticism over the years because it was historically difficult to amend claims in an IPR proceeding.  In response to that criticism, the Patent Office started a Pilot Program that will give a patent owner two chances to amend its claims.  The Pilot Program began on March 14, 2019, and applies to every IPR proceeding instituted on or after that date.  Petitioners should now carefully consider the impact of this “second chance at life” provided by the Pilot Program.

Until recently, those accused of patent infringement would often file IPR petitions as a matter of course.  The decision was generally an easy one—the IPR procedure is relatively inexpensive when compared to the costs of district court litigation and the standard of review is considerably more favorable to defendants.  In the district court, a patent challenger must prove patent invalidity by clear and convincing evidence, which is an exceedingly rigorous standard.  On the other hand, in IPR, a patent challenger need only prove unpatentability by a preponderance of the evidence—a standard that has proved to be far easier to meet.

Two other factors contribute to the high rate of IPR filings.  First, if a patent challenger acts promptly, then the patent challenger may be able to stay the litigation, thus dramatically reducing its legal spend.  Second, the parties will have a good sense as to whether the patent is likely to survive in only six months.  At the six-month mark, the Patent Trial and Appeal Board (“PTAB”) will issue its institution decision.  If the PTAB finds in its institution decision that the patent challenger is likely to prevail, then it is more likely than not that the PTAB’s final written decision at the end of the process will reach the same conclusion.  Statistics from Docket Alarm reveal that after a petition is instituted, at least some claims are held unpatentable 81% of the time, and all challenged claims have been found unpatentable 65.5% of the .  In addition, these statistics do not address IPR proceedings that settle after institution and thus, do not reach a final written decision.

From the inception of inter partes review in 2012, patent owners who felt their claims were vulnerable to cancellation could move to amend the claims as of right.  Section 316(d) of the patent statute provides that the “patent owner may file 1 motion to amend the patent” by proposing “a reasonable number of substitute claims,” provided that the substitute claims do “not enlarge the scope of the claims of the patent.”  35 U.S.C. § 316(d).  The proposed amendment would be filed with the patent owner’s response.  In the event that the PTAB found the original claims unpatentable, or the patent owner itself disclaimed the original claims, the PTAB would consider whether the patent owner was nonetheless entitled to the substitute claims.

Nonetheless, in practice it was virtually impossible to obtain amended claims because the Patent Office placed the burden on the patent owner to prove that the amended claims were patentable over all prior art known to the patent owner (at least to the extent that the prior art constituted patents and printed publications).  In 2017, the Federal Circuit changed that standard in the en banc Aqua Products Inc. v. Matal decision. 872 F.3d 1290 (Fed. Cir. 2017).  In Aqua Products, the Federal Circuit held that the burden of persuasion should be on the petitioner in an IPR proceeding to demonstrate that patent owner was not entitled to the amended claims.  After that decision, commentators predicted a significant uptick in the grant of amended claims, but to date, there have still been relatively few requests, and fewer still amended claims at the end of the IPR process.

In the first two months of 2019, the PTAB issued only two final written decisions where the challenged claims were found unpatentable and the PTAB reached motions seeking substitute claims.  In Analytics for Life, Inc. v. 8825319 Canada Limited, IPR2017-01742 (January 30, 2019), the patent owner sought numerous substitute claims, and all but one were found invalid as not supported by the patent specification and obvious over the prior art.  However, the PTAB found the patent owner entitled to one substitute claim that had clear support in the specification and where the petitioner was unable to prove that the additional limitation was in the prior art.

In Epsilon Data Management, LLC. V. Umbanet, Inc., IPR2017-01743, a district court action was far ahead of the IPR proceedings, and the challenged claims had already been invalidated in court on the ground of indefiniteness.  In the IPR proceeding, the patent owner sought substitute claims, but the PTAB denied the request, and found that the substitute claims were likewise indefinite.  Unfortunately for the patent owner, the substitute claims contained the same indefinite terms found in the original claims.  There were also a handful of other proceedings were motions to amend were filed, but in each case, the challenged claims were found patentable rendering the motion to amend moot.

The Pilot Program may increase the number of amendments approved by the PTAB in IPR proceedings.  Under the Pilot Program, a patent owner may request “preliminary guidance” from the PTAB as to whether its substitute claims would be granted.  The “preliminary guidance” is non-binding and will only address the limitations of the substitute claims added by the amendment.  The “preliminary guidance” will not comment on the patentability of the originally challenged claims.  The patent owner may then file a revised motion to amend further narrowing the substitute claims to address any concerns raised by the PTAB.

The original motion to amend procedure allowed the patent owner only a single chance at amending its claims – that is, the patent owner would file a motion to amend, along with its patent owner’s response, the petitioner would file an opposition to the motion, in response to which the patent owner would file a reply.  The PTAB would decide the motion to amend based on this single iteration of briefing.  The recently launched Pilot Program, however, provides patent owners with a second chance to craft an acceptable substitute claim.  Under the Pilot Program, the patent owner may request preliminary guidance, and the PTAB will provide that guidance no later than four weeks after the petitioner files its opposition to the motion to amend.  The patent owner may then choose to file a revised motion to amend which further narrows the substitute claims in order to distinguish the prior art of record.  Any claim modification, argument, or evidence in the revised motion to amend must respond to the preliminary guidance or the petitioner’s opposition.  The petitioner is then provided an opportunity to file an opposition to the revised motion to amend, followed by a patent owner reply, and a petitioner sur-reply.

Should the patent owner file a revised motion to amend, then the oral hearing at the conclusion of the IPR proceeding will be rescheduled roughly a month out to accommodate the additional briefing and depositions needed to respond to the revised motion to amend.  In its Notice announcing the Pilot Program, the Patent Office recognized that the schedule for amendment practice is compressed and offers the following admonishment:

Once likely declarants are known, the parties should confer promptly as to dates for scheduling all depositions after the relevant papers are to be filed. Parties are expected to make their declarants available for such depositions promptly, and to make their attorneys available to take and defend such depositions; any unavailability will not be a reason to adjust the schedule for briefing on an MTA or revised MTA absent extraordinary circumstances. Again, it is incumbent upon the parties to work cooperatively to schedule depositions of their declarants.

Given the compressed schedule, this new amendment procedure requires petitioners to do the legwork up front to address potential amendments.  If a petitioner waits for the patent owner to serve a motion to amend, it may be too late to find the necessary prior art.

In theory, this revised amendment practice may increase the chance of a successful amendment.  Therefore, it is possible that more patent owners will file motions to amend as an insurance policy against successful patentability challenges.  Petitioners should consider this possibility and be prepared for it.  Specifically, petitioners should be looking for art that not only invalidates the actual claims of the patent, but should also assemble a store of “backup” art that disclose unclaimed features of the challenged patent that a patent owner may seek to add by amendment (and, in particular, unclaimed features the patent owner has found in the accused products).

Likewise, a patent owner should be thinking about possible amendments from the inception of a lawsuit, or at least from the moment it is notified that an IPR petition has been filed challenging the patent.


The opinions expressed are those of the author and do not necessarily reflect the views of Fish & Richardson P.C., any other of its lawyers, its clients, or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.

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