IP UPDATE
Exploring the latest in intellectual property law
IP UPDATE
Exploring the latest in intellectual property law
Patent Trial & Appeal Board
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Obviously Prima Facie Case Overcome by Secondary Considerations

by | Jun 15, 2023 |

The US Court of Appeals for the Federal Circuit affirmed the Patent Trial & Appeal Board, holding that the Board did not err in finding certain challenged claims nonobvious and not unpatentable based on a showing of several objective criteria of nonobviousness and a nexus of the evidence to a commercial product embodying the claimed invention. Medtronic, Inc. v. Teleflex Innovations S.A.R.L., Case No. 21-2357 (Fed. Cir. June 05, 2023) (Moore, C.J.; Lourie, Dyk, JJ.) and Medtronic, Inc. v. Teleflex Innovations S.A.R.L., Case No. 21-2359 (Fed. Cir. June 05, 2023) (Moore, C.J.; Lourie, Dyk, JJ.)

Teleflex developed and patented a novel catheter-based stenosis intervention system that successfully mitigated long-standing risks intrinsic to existing catheter-based intervention systems, in particular damage to the coronary artery from guide catheter dislodgement or a catheter’s distal tip (i.e., the end of the catheter farthest from the insertion site). The preferred embodiments incorporated into Teleflex’s extremely successful GuideLiner products comprised a proximal substantially rigid portion (yellow), a reinforced portion (blue) and a distal flexible tip (pink), as illustrated below.

The catheters were sized so they could be inserted through standard guide catheters and thus were coined guide extension catheters. This innovative nesting feature increased guide catheter backup support while the guide extension catheter’s soft distal end was less likely to cause tissue damage once deeply inserted into patients. Teleflex’s guide extension catheters also were optimized for receiving interventional cardiological devices. This optimized function was a combination of the catheter’s coaxial lumen, that lumen’s diameter being no more than one French (i.e., 1/3 mm) less than the diameter of the guide catheter, and a proximal side opening that featured a double incline design like that illustrated above.

Teleflex’s GuideLiner was introduced in 2009 and enjoyed “undisputed commercial success and industry praise.” In 2019, Medtronic introduced its competing guide extension catheter (Telescope) and filed six inter partes review (IPR) petitions against Teleflex’s extension guide catheter family. Three of Medtronic’s petitions asserted that the challenged claims in three of Teleflex’s patents were obvious over the evacuation sheath assembly with a distal side opening used to aspirate embolic material while occluding blood flow using sealing balloons disclosed in a prior art reference (Ressemann). The other three petitions challenged claims of the other Teleflex patents as being obvious over a support catheter for delivering angioplasty balloons disclosed in a prior art reference (Kontos).

Medtronic specifically asserted that the following three elements of Teleflex’s claimed catheters were obvious:

  1. A proximal side opening. Medtronic argued that it would have been obvious to replace the proximal funnel structure of Kontos’s support catheter with the distal side opening of Ressemann’s evacuation sheath assembly.
  2. A catheter diameter that is no more than one French less than a corresponding guide catheter. Medtronic argued that in view of prior art mother-and-child dual catheter systems in which the child catheter’s diameter is no [...]

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Neither Narrow Proposed Claim Construction nor Work Product Claim Justify Withholding Material Factual Information

by and | Jun 1, 2023 |

The Patent Trial & Appeal Board of the US Patent & Trademark Office (PTO) canceled all challenged claims across five patents because the patent owner failed to meet its duty of candor by selectively and improperly withholding material information that was inconsistent with its patentability arguments. Spectrum Solutions, LLC v. Longhorn Vaccines & Diagnostics, LLC, IPR2021-00847; -00850; -00854; -00857; -00860 (PTAB May 3, 2023) (Braden, Yang, Derrick, Pollock, APJs) (per curiam) (Braden, APJ concurring).

The Board instituted inter partes reviews (IPRs) against five Longhorn patents based on petitions filed by Spectrum. During the proceedings, Longhorn filed motions to amend, after which the Board issued preliminary guidance suggesting that Spectrum established a reasonable likelihood that the proposed substitute claims were unpatentable. Longhorn engaged Assured Bio Labs (ABL) to conduct biological testing that would support its arguments distinguishing a prior art reference, but Longhorn made attorney work product objections in Spectrum’s ABL depositions and withheld testing data inconsistent with its arguments on the patentability of the original and proposed substitute claims. The Board subsequently allowed additional questioning on certain ABL testing, after which Spectrum filed a motion for sanctions, requesting judgment against Longhorn, a finding that the prior art reference taught the claim limitations and precluding Longhorn from contesting the finding, and an award to Spectrum of compensatory expenses, including attorneys’ fees.

The Board determined that sanctions of adverse judgment as to all challenged claims was appropriate because Longhorn failed to meet its duty of candor and good faith. The Board explained that parties have a duty of candor and good faith before the Board that requires any factual contentions to be well supported by evidence. Parties have “a duty to disclose to the [PTO] all information known . . . to be material to patentability.” (37 C.F.R. §1.56(a).) Information is material to patentability when it is “not cumulative to information already of record or being made of record in the application and . . . it refutes, or is inconsistent with, a position the applicant takes in . . . asserting an argument of patentability.” Taking a position contrary to any known fact while shielding factual information from the Board violates the duty of candor and good faith to the PTO, even if the party may otherwise withhold the information as being immaterial to patentability or privileged.

The Board criticized Longhorn’s proposed claim constructions as too narrow and contrary to the express language in both the original and proposed substitute claims. The Board explained that although Longhorn was free to maintain arguments grounded on Longhorn’s claim constructions, that did not excuse Longhorn’s duty of candor and good faith dealing, including disclosing material information relating to the Board’s preliminary claim constructions. Longhorn could not “simply withhold information” that the PTO would find material to patentability and should instead contest the Board’s constructions at trial.

The Board also explained that Longhorn took an overly strict view of what was material to claim patentability and a lax view as to the duty of candor [...]

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Pending Appeal Does Not Divest Board of Statutory Authority to Institute IPRs

by | May 18, 2023 | ,

In a case involving sua sponte review, the Director of the US Patent & Trademark Office (PTO) vacated an inter partes review (IPR) decision denying institution, found that the Patent Trial & Appeal Board had statutory authority to institute IPR review of a claim that had been previously found invalid by a district court under 35 U.S.C. § 101 (but under appeal), and remanded the proceeding for the Board to consider whether discretionary denial was appropriate. Volvo Penta of the Americas, LLC v. Brunswick Corp., IPR2022-01366, -01367, -01368, -01369, -01424 (PTO May 2, 2023) (Vidal, Dir.).

Brunswick owns several patents related to marine vessels. Volvo filed IPR petitions challenging the patents, which the Board ultimately denied. Prior to the Board’s decision, the District Court for the Eastern District of Virginia determined that claim 1 in each of the challenged patents was directed to patent-ineligible subject matter and thus was invalid under § 101. In denying institution, the Board concluded that it lacked authority to institute the IPRs because the challenged claims were no longer in effect and the America Invents Act (AIA) only permits a petitioner to challenge a claim, noting that “when given its plain and ordinary meaning, § 311(b) provides that only claims that are in effect may be annulled.” Although Brunswick appealed the district court’s decision, the Board determined that the challenged claims were finally adjudicated. Thus, the Board lacked authority to institute the requested IPR. The Board also determined that the multi-factor Fintiv analysis for discretionary denial under 35 U.S.C. § 214(a) was inapplicable here in view of the district court’s invalidity finding.

The Director reviewed the Board’s decision sua sponte and vacated the Board’s institution decision with instructions to analyze Fintiv factors 1 through 5 in view of the parallel district court proceeding.

The Director first addressed the Board’s § 311(b) analysis. The Director concluded that in finding the district court’s invalidity determination to be a final adjudication, the Board appeared to have borrowed from collateral estoppel principles. The Director found, however, that these principles do not apply to § 311(b) nor was there any assertion that Volvo was collaterally estopped from pursuing IPRs. The Director also determined that the challenged claims were not fully adjudicated since the district court’s decision was subject to further judicial review. Thus, the Director found that the Board had statutory authority to institute the IPRs.

Next, the Director addressed the Board’s Fintiv analysis, finding that the Board improperly interpreted Fintiv as limited to its exercise of discretion in the context of ongoing parallel district court litigation where final judgment has not yet been entered. The Director explained that the Fintiv analysis applied where, as here, the claims remain subject to further review on appeal. The Director instructed the Board to evaluate the Fintiv factors on remand and instructed that if the Board determines that these factors favor discretion to deny institution, the Board should then consider whether the case on the merits is compelling (consistent with the
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Hanging Patentability on Written Description Cannot Be Truss-ted

by | May 4, 2023 |

The US Court of Appeals for the Federal Circuit upheld a Patent Trial & Appeal Board finding that the claims of a patent for a truss hanger were invalid for lack of written description because they claimed an undisclosed range despite the predictable nature of the technology. Columbia Insurance Company v. Simpson Strong-Tie Company Inc., Case Nos. 21-2145; -2157 (Fed. Cir. Mar. 31, 2023) (Prost, Hughes, JJ.) (Moore, C.J., dissenting) (non-precedential).

Truss hangers secure support beams to wall frames in buildings. These hangers normally accommodate layers of fire-resistant sheathing by cutting out the sheathing that overlaps with the hanger, but this can reduce fire resistance. Columbia owns a patent claiming a truss hanger that extends through the sheathing and does not decrease fire resistance. The extension for the sheathing, illustrated below, must be “sized large enough to permit two layers of ⅝ inch thick sheathing to be received between the rear edge plane and the back flange plane, but too small to permit three layers of ⅝ inch thick sheathing to be received.”

Simpson petitioned for a post-grant review of the patent at the Board. That proceeding resulted in a mixed decision. The Board found in favor of Simpson that certain original claims and certain substitute claims of the patent were unpatentable for lack of written description and that certain claims were obvious over the prior art. However, it found in favor of Columbia with regard to one claim. Both parties appealed.

The Federal Circuit affirmed the Board’s findings regarding written description. The claimed extension portion covered a range of extension sizes between the upper limit (three layers of five-eighths-inch-thick sheathing) and lower limit (two layers of five-eighths-inch-thick sheathing). The Court affirmed the Board’s finding that nothing in the specification covered the claimed upper limit. Columbia argued that a skilled artisan would read the claims to cover exactly two layers of five-eighths-inch-thick sheathing, but the Court found that this claim construction argument was forfeited because it was raised for the first time on appeal and, even if it weren’t, it was incorrect because it was akin to rewriting the claims.

The Federal Circuit also affirmed the Board’s finding that certain claims were obvious, concluding that the Board’s determination was supported by substantial evidence. The Court rejected Columbia’s argument that the Board’s claim construction violated the Administrative Procedure Act because the construction adopted by the Board was similar enough to Simpson’s proposed construction and not raised sua sponte.

Finally, the Federal Circuit affirmed the Board’s finding that the claim on which Simpson appealed was not indefinite because the term “large enough to permit the drywall to be received” informs a skilled artisan with reasonable certainty that the scope of this claim includes any extension portion sized larger than the smallest commonly known sheathing size. The Court also found that the claim was not obvious because the Board correctly interpreted the claim language “extend [...]

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If Prior Art Discloses Ingredients and How to Mix Them, the “Cake” Is Anticipated

by | Apr 20, 2023 |

The US Court of Appeals for the Federal Circuit affirmed that challenged claims were invalid as anticipated based on principles of inherency where the disclosed prior art formulations and processes necessarily met a disputed claim limitation. Arbutus Biopharma Corp. v. ModernaTx, Inc., Case No. 20-1183 (Fed. Cir. April 11, 2023) (Reyna, Schall, Chen, JJ.)

Arbutus Biopharma owns a patent that matured from an application filed on March 9, 2015, that claims priority to a provisional application filed on June 30, 2010. The claimed invention provides stable nucleic acid-lipid particle (SNALP) formulations with a non-lamellar structure that function to increase the efficiency of nucleic acid entry into cells to promote the downregulation of gene expression. The non-lamellar morphology of a SNALP formulation was known to depend on two factors: the lipids incorporated into the SNALP formulation, and the process used to form the SNALPs. The patent disclosed five SNALP formulations of various compositions that can be used and incorporated by reference two US patent publications, which describe two methods that can be used to make SNALP formulations: the Direct Dilution Method (DDM) and the Stepwise Dilution Method (SDM). The representative independent claim recites a composition of SNALPs, wherein each particle in the plurality of SNALP particles comprises a nucleic acid and various lipid types. The claim also requires that at least 95% of the particles in the plurality of particles have a non-lamellar morphology (the Morphology Limitation).

Moderna filed a petition for inter partes review (IPR) asserting that all the claims of the Arbutus patent were anticipated by a prior art patent. The Patent Trial & Appeal Board found that although the Morphology Limitation was not expressly found in the prior art, the claims were anticipated. The Board determined that the Morphology Limitation was an inherent property (or natural result) of the prior art disclosures. On appeal, Arbutus challenged the Board’s inherent and express anticipation findings for many of the challenged claims, including for the Morphology Limitation.

A limitation is inherent if it is the natural result flowing from the prior art’s explicit disclosure. In other words, a limitation is inherent when the limitation is a property necessarily present in the invention and not actually an additional requirement imposed by the claims. In the IPR proceeding, Moderna argued that the Morphology Limitation was inherent because one skilled in the art would necessarily obtain formulations meeting this limitation by making formulations using the five formulations disclosed by the patent and using the DDM method (from the incorporated-by-reference disclosures) to prepare the formulations.

Both the challenged patent and the prior art disclosed five formulations that can be used to obtain the SNALP formulations. Evidence showed that any differences between the formulations disclosed in these patents would not impact the Morphology Limitation. The Federal Circuit found that substantial evidence supported a finding that the formulations disclosed in both the challenged patent and the prior art were the same or essentially the same.

The Federal Circuit further explained that both the challenged patent and the [...]

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Press Pause: De Novo Review Not Always Required for Obviousness

by | Apr 6, 2023 |

A divided panel of the US Court of Appeals for the Federal Circuit affirmed the Patent Trial & Appeal Board’s finding that certain challenged claims were nonobvious after applying the substantial evidence test to resolve a dispute regarding the scope and content of the prior art that the Board had resolved as a purely factual question. Roku, Inc. v. Universal Elec’s, Inc., Case No. 2022-1058 (Fed. Cir. Mar. 31, 2023) (Reyna, Stoll, JJ.) (Newman, J., dissenting). In her dissent, Judge Newman stated that even though the issue on appeal related to an underlying factual finding, the ultimate issue of obviousness remains a question of law that requires de novo review.

Universal Electronics owns a patent directed to a universal control engine (within a universal remote) that allows for communication between a “controlling device” (i.e., remote) and an “intended target appliance” (e.g., TV, DVD player). The universal control engine uses different communication methods “according to the optimal method of communication for each target appliance and command,” such as Consumer Electronic Control (CEC) commands or infrared (IR) commands.

The Federal Circuit majority first noted that the disposition of the appeal rested on a single, narrow factual issue: whether the prior art’s list of command codes that are formatted to be transmitted via different communication methods is the same as the list of different communication methods recited in the challenged claims.

The panel majority began by recognizing two relevant standards of review to be used when resolving an obviousness inquiry. First, the Federal Circuit noted that it reviews “underlying factual findings” for “substantial evidence.” Substantial evidence review considers whether a “reasonable fact finder could have arrived at the [Board’s] decision.” The Court specified that the underlying findings of fact relevant to an obviousness inquiry include the Graham factors, which comprise “the scope and content of the prior art,” among others. Next, the Court acknowledged that “[t]he ultimate question of obviousness is a legal question that it reviews de novo.”

The panel majority noted that both Roku and Universal persuasively argued their positions related to the scope and content of the prior art, that “the factual dispute . . . was highly contested and closely decided,” and that substantial evidence supported the Board’s finding. On that basis, the Federal Circuit affirmed the Board’s holding that Roku failed to show that the challenged claims were obvious. The Court declined to perform de novo review of the ultimate question of obviousness, reasoning that because Roku only raised factual questions on appeal (i.e., whether the prior art taught a particular claim element), the Court only needed to consider whether the Board’s determination on that issue was supported by substantial evidence.

In her dissent, Judge Newman disagreed with the majority decision to abstain from a de novo review of obviousness notwithstanding the majority’s conclusion that the underlying findings of fact were supported by substantial evidence. Judge Newman argued that both forms of review are appropriate—and required—in cases such as this. In her de novo review, Judge Newman concluded [...]

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Disclaiming Claim Scope: Could the Patentee Have Anticipated This?

by | Apr 6, 2023 |

In the most recent decision in the Apple/VirnetX saga, the US Court of Appeals for the Federal Circuit affirmed a remand ruling from the Patent Trial & Appeal Board finding the challenged claims of VirnetX’s patents unpatentable. VirnetX Inc. v. Mangrove Partners Master Fund, Ltd., Case No. 2020-2271 (Fed. Cir. Mar. 30, 2023) (Moore, C.J.; Hughes, Stark, JJ.) (nonprecedential).

VirnetX owns two patents relating to a “secure mechanism for communicating over the internet.” The patents relate to a system in which a DNS module “intercepts . . . and determines whether [a] request is for a secure site.” The system creates a VPN if the proxy determines that the request is for a secure site. If the proxy determines that the request is not for a secure site, it forwards the request to a conventional DNS.

Mangrove, Apple and Black Swamp (collectively, Mangrove) petitioned for inter partes review (IPR) challenging various claims of the patents. The Board found that all the challenged claims were unpatentable as anticipated by Kiuchi or obvious in view of Kiuchi and other references. VirnetX appealed to the Federal Circuit (Mangrove Appeal). In that appeal, the Federal Circuit determined that, contrary to the Board’s finding, when VirnetX distinguished Aventail during reexamination of one of the patents, VirnetX disclaimed “a system in which a client computer communicates with an intermediate server via a singular, point-to-point connection.” As a consequence of the prosecution disclaimer, the Court found that the claims “require[s] direct communication between the client and target computers.” The Court vacated the Board’s decision and remanded the case for the Board to determine further factual questions regarding Kiuchi because “substantial evidence does not support the Board’s finding that the C-HTTP name server of Kiuchi performs the functions of the claimed DNS proxy module.”

Following the Mangrove Appeal, the Board again found that Kiuchi—the only prior art reference at issue in the present appeal—discloses a “secure network” for the transfer of patient information in a hospital setting and teaches a “direct-communication VPN between the client and target.” As a result, the Board concluded that Kiuchi anticipates all the challenged claims. VirnetX again appealed.

The Federal Circuit first addressed the Board’s conclusion that “Kiuchi teaches a direct-communication VPN and is therefore within the scope of the claims of VirnetX’s … patent, and not an indirect-communication VPN, which would have brought Kiuchi within the scope of VirnetX’s disclaimer.” The Court agreed with the Board that “Kiuchi discloses direct communication that satisfies the claimed VPN.” Specifically, “Kiuchi’s user agent does not communicate with the client-side proxy using a singular, point-to-point connection because the user agent addresses the desired endpoint, and the VPN provides the required message routing for the user agent to receive a response from the desired endpoint.” Moreover, the Court reasoned that Kiuchi’s proxy servers forward data packets and that Kiuchi teaches “the ability to address data to a particular computer,” consistent with the scope of the claims.

Next, the Federal Circuit addressed the Board’s [...]

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No One Likes a Sore Winner: IPR Prevailing Party Can’t Appeal

by | Mar 23, 2023 |

Reaffirming precedent, the US Court of Appeals for the Federal Circuit reiterated the rule that the prevailing party in an inter partes review (IPR) cannot appeal a Patent Trial & Appeal Board decision. Termax Co. v. Illinois Tool Works, Inc., Case Nos. 23-1252; -1254 (Fed. Cir. Mar. 8, 2023) (Dyk, Reyna, Chen, JJ.)

Illinois Tool Works (ITW) asserted that Termax had infringed a patent directed to an automobile fastener. Termax challenged the asserted patent by filing a petition for IPR. The petition was granted, and ultimately the Board agreed with Termax that all the challenged claims of ITW were unpatentable. Both parties appealed.

ITW moved to voluntarily dismiss its own appeal and to dismiss Termax’s cross-appeal. Termax opposed, arguing that the Board erred in its construction of certain claim limitations that have also been incorporated into a new ITW patent.

The Federal Circuit dismissed both appeals. Citing what it called a “familiar rule,” the Court stated that the winner in a lower court or other tribunal cannot ordinarily seek relief in the appellate court. The Court was not persuaded by Termax’s argument that the Board erred in its construction of certain claim limitations, noting that Termax sought to appeal the constructions in the hopes that a Federal Circuit decision in its favor would “collaterally estop Illinois Tool Works from asserting those newly issued claims.” However, the Court refused to hear the appeal prematurely, stating that if ITW asserts the claims of its new patent against Termax in the future, Termax can address the issue at that time.

Practice Note: While an IPR can be a powerful tool for accused infringers, it is not without future risks.



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Claim Duality: Multiple Dependent Claims Can Be Both Patentable and Unpatentable

by | Mar 9, 2023 |

Addressing, for the first time, the issue of patentability of multiple dependent claims under 35 U.S.C. § 112, fifth paragraph, the Director of the US Patent & Trademark Office (PTO) granted rehearing and modified the Patent Trial & Appeal Board’s (Board) Final Written Decision after finding that the patentability of a multiple dependent claim should be considered separately as to each of the claims from which it depends. Nested Bean, Inc. v. Big Beings US Pty. Ltd. et al., IPR2020-01234 (PTO Feb. 24, 2023) (Vidal, Dir.) (precedential).

Nested filed a petition for inter partes review challenging claims 1 through 18 of a patent owned by Big Beings. Claims 1 and 2 were independent, and claims 3 to 16 were multiple dependent claims, which depended directly from either claim 1 or 2. The Board granted institution and ultimately issued a Final Written Decision finding that Nested did not establish that claims 1, 17 and 18 were unpatentable, but that Nested had established that claims 2 through 16 were unpatentable.

Big Beings filed a Request for Director review, noting that each of claims 3 to 16 were multiple dependent claims that depended from both claims 1 and 2. Big Beings argued that because the Board found that Nested failed to show that claim 1 was unpatentable, the Board should have also found that Nested failed to show that claims 3 through 16, as depending from claim 1, were unpatentable. The Director granted review.

35 U.S.C. § 112, fifth paragraph, states, in relevant part, “[a] multiple dependent claim shall be construed to incorporate by reference all the limitations of the particular claim in relation to which it is being considered.” Big Beings argued that the statute requires the Board to separately consider the patentability of alternative dependencies of a multiple dependent claim. Nested responded by arguing that the statute should be read so that if any version of a multiple dependent claim is found unpatentable over the prior art, then all versions of the claim should be found unpatentable.

The Director found that this was an issue of first impression. Relying on 37 C.F.R. § 1.75(c) and 35 U.S.C. § 282, the Director concluded that “a multiple dependent claim is the equivalent of several single dependent claims. Thus, in the same way that the unpatentability of multiple single dependent claims would each rise or fall separately, so too should the dependent claims covered by a multiple dependent claim.” The Director also noted that the Federal Circuit in Dow Chemical and Dayco Products explained that “not addressing claim validity on an individual basis is an error and contravenes 35 U.S.C. 282[.]” The PTO Director concluded, quoting the Manual of Patent Examining Procedure (MPEP), that “a multiple dependent claim must be considered in the same manner as a plurality of single dependent claims.”



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Compelling Clarity: PTO Director Explains Compelling Merits Test

by | Mar 9, 2023 |

US Patent & Trademark Office (PTO) Director Katherine K. Vidal issued a precedential opinion clarifying the standard under which the Patent Trial & Appeal Board (Board) can institute on an inter partes review (IPR) petition despite the Fintiv factors militating toward denial. CommScope Techs. LLC v. Dali Wireless, Inc., IPR2022-01242 (PTO Feb. 27, 2023) (Vidal, Dir.) (precedential).

This opinion follows the Director’s Interim Procedure for Discretionary Denials memorandum (Guidance Memo) and her opinion in OpenSky Indus. v. VLSI Tech. In the guidance memo, the Director explained that when there is “compelling evidence of unpatentability,” the Board may decline to exercise its discretion to deny IPR institution.

In this case, Dali Wireless sued CommScope in the district court, alleging infringement of its patent. CommScope filed a petition to institute an IPR proceeding against the asserted patent. The Board granted the petition and instituted an IPR proceeding while the district court litigation was ongoing.

In granting the petition, the Board acknowledged that it would normally perform a Fintiv analysis to determine whether it should deny the petition in light of the parallel district court proceeding. However, considering the Guidance Memo and the “compelling invalidity challenge” presented by the petitioner, the Board skipped the Fintiv analysis and instituted on the petition. The Director instituted sua sponte review.

Recognizing some ambiguity in both OpenSky and the guidance memo, the Director made her decision precedential to clarify:

My Guidance Memo states that “the PTAB will not deny institution based on Fintiv if there is compelling evidence of unpatentability.” Although I now recognize that this instruction could be read to allow for a compelling merits determination as a substitute for a Fintiv analysis, that was not my intent. By that instruction, I intended for PTAB panels to only consider compelling merits if they first determined that Fintiv factors 1–5 favored a discretionary denial . . . . In circumstances where . . . the Board’s analysis of Fintiv factors 1–5 favors denial of institution; the Board shall then assess compelling merits. In doing so, the Board must provide reasoning sufficient to allow the parties to challenge that finding and sufficient to allow for review of the Board’s decision.

A determination of whether the petition presents a compelling merits case for invalidity requires a merits case that meets a higher standard than the “reasonable likelihood” test required by 35 U.S.C. § 314(a).

The Director found that the Board’s decision was deficient in both parts of the analysis. The Board did not perform any analysis of the Fintiv factors but instead went straight to a determination of whether the petition presented a compelling invalidity challenge. In connection with that determination, the Board failed to provide any reasoning that explained why it found the merits case presented in the petition compelling.

Finding that the Board’s reasoning was conclusory, the Director vacated the Board’s decision to institute IPR review and remanded for further proceedings consistent with her decision.

Practice Note: Less [...]

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