Lessons Learned from the First IPR Decision by the Federal Circuit - Patent Office Successfully Takes Over Garmin's Attack on Cuozzo's Patent
February 11, 2015
Hamilton Brook Smith Reynolds Alert
- Inter Partes Review creates a new order for patent owners and those accused of infringement
- Patent owners must pursue a broad array of claims; patent challengers are well advised to assess blocking patents to see if an IPR can clear a path to use of the technology
- The Federal Circuit approved application of the broadest reasonable interpretation standard in an IPR
Garmin successfully used an Inter Partes Review ("IPR") counterattack when it was sued for patent infringement and, once Garmin settled with the patent owner, the Patent Office continued the fight before the Federal Circuit. The Federal Circuit panel, in an opinion dated February 4, 2015, authored by Judge Dyk and joined by Judge Clevenger, rejected every ground for appeal by the patentee from the decision of the Patent Trial and Appeal Board ("PTAB"). In re Cuozzo Speed Tech. IPRs, one of the post-grant proceedings created by the America Invents Act ("AIA"), create a new order for patent owners and those accused of infringement.
The patent at issue claims an interface that displays a vehicle's current speed and the speed limit for the vehicle's location. Significant to affirmance, and a focus of Judge Newman's dissent, the Federal Circuit approved the PTAB's application of the broadest reasonable interpretation standard in construing "integrally attached" in a challenged claim. As a result, the standard for claim construction in an IPR is different from the standard applied by a District Court, where a claim term is given the meaning it would have to a person of ordinary skill in the art. The Federal Circuit found that Congress implicitly adopted application of the broadest reasonable construction standard in enacting the AIA.
Because the opportunity to amend is (at least theoretically) "available" in an IPR, the majority rejected the patent owner's attempt to argue against application of the broadest reasonable construction standard. The Federal Circuit recognized, but did not find materially different, that the opportunity for amendment "is cabined in the IPR setting" and that in an IPR the patent owner may be limited to a single amendment, may not broaden claims, and must address the ground for unpatentability. Nevertheless, the Federal Circuit affirmed the denial of the motion to amend in this case because the substitute claim in the proposed amendment, properly construed, would improperly broaden the claims.
The patent owner failed in its attempt to limit to the timeframe before a final decision the statutory prohibition against an appeal of whether the PTAB properly instituted the IPR. Although the Federal Circuit found this would not be a case for mandamus, it left undecided whether mandamus could be available in other cases to review the institution of an IPR after a decision. The Federal Circuit also reviewed the PTAB construction of the claim de novo because there is no issue as to extrinsic evidence, applying the Supreme Court's recent Teva decision on the standard of review for claim construction. In addition, the Federal Circuit found no error in the PTAB's interpretation and agreed with the obviousness determination.
The decision provides important lessons for proceeding in the high stakes world of patent prosecution and enforcement. The Cuozzo case could undergo revision if the patentee seeks rehearing or files a petition to the Supreme Court for certiorari, but the following important takeaway messages are unlikely to change:
- Challenge patents by filing an IPR. The Federal Circuit decision affirmed a successful challenge to the patent using the IPR proceeding. It is time to reassess pursuing valuable technology options that your company did not pursue because a patent blocked the way. You should now consider the availability of prior art that can be used in an IPR to clear the path in order to practice the invention.
- Pursue an array of claims when obtaining patent protection for your invention. Because the Federal Circuit affirmed the PTAB's rejection of Cuozzo's attempt to amend its claims in the IPR, it is more important than ever to make sure that your patent issues with both broad and narrow claims. Had the claims Cuozzo wanted to add by amendment in the IPR been in the original patent, they may have survived the IPR.
- File a continuation to provide an opportunity to present claims to protect your invention. It may not be possible to anticipate prior art that a third party will uncover and use in an IPR. With a continuation pending, it may be possible to avoid dire consequences if your patent is challenged in an IPR.
- File a reissue application if there is no continuation pending in order to seek issuance of an array of claims that protect your invention. You must be aware of limitations, such as intervening rights and recapture, that could make a reissue less advantageous than a continuation.
- Mandamus may be available to challenge the grant of a petition to institute an IPR where the PTAB has "clearly and indisputably exceeded its authority."
- No appeal means no appeal. This means that mandamus, if available, could be the only avenue for review of a decision to institute IPR, and mandamus would only be available if the PTAB clearly and indisputably exceeds its authority to institute the IPR.
- Settlement of an IPR may not end it. Here, the Patent Office took over the matter from Garmin and kept it alive before the Federal Circuit, even though Garmin and the patent owner resolved the matter between them.