Share, Linked In, , , Google Plus

Print

Posted in:

Reissue Applications During Post Grant Proceedings: To Stay or Not to Stay?

Given the Patent Trial and Appeal Board’s (“PTAB” or “Board”) reluctance to grant motions to amend claims during AIA post-grant proceedings, patent owners faced with post-grant challenges have attempted to circumvent the challenge of amending claims by filing reissue applications of challenged patents.  By doing so, the patent owner attempts to create two parallel proceedings at the USPTO, whereby the PTAB and an examiner are asked to independently and simultaneously consider the patentability of overlapping or similar subject matter.

Stays of reissue applications filed during post-grant proceedings are routinely granted, with some notable exceptions.  Under 35 U.S.C. § 315(d) and 37 C.F.R. 42.122, the PTAB is authorized to regulate any matter or proceeding before the USPTO that is co-pending with an IPR and involves the same patent.  The Director has authority to stay a reissue proceeding pursuant to 35 U.S.C. § 315(d), which provides:

 (d) Multiple Proceedings.—Notwithstanding sections 135(a), 251, and 252, and chapter 30, during the pendency of an inter partes review, if another proceeding or matter involving the patent is before the Office, the Director may determine the manner in which the inter partes review or other proceeding or matter may proceed, including providing for stay, transfer, consolidation, or termination of any such matter or proceeding.

 Under 37 C.F.R. § 42.122(a), the Board may enter an order to effect a stay:

 Multiple proceedings. Where another matter involving the patent is before the Office, the Board may during the pendency of the inter partes review enter any appropriate order regarding the additional matter including providing for the stay, transfer, consolidation, or termination of any such matter.

In addition, the Board may exercise exclusive jurisdiction within the USPTO over an application underlying a patent involved in an IPR. 37 C.F.R. § 42.3(a). When doing so, the Board may take various actions, including staying that application.  Specifically, the PTAB can order a stay of a reissue application related to a patent that is involved in a co-pending IPR.

Generally, the PTAB’s reasoning for such a stay is to prevent duplicative efforts, to avoid potentially inconsistent results between the proceedings, or to simplify the issues in a reissue application.  See IPR2013-00217, Paper 8 at 2­–3. For example, in two IPRs, the PTAB’s rationale for a stay was that should examination of a co-pending reissue application begin, the USPTO may allow amended versions of the instituted claims, thereby changing the scope of the instituted claims while the PTAB is conducting the IPR. See IPR2015-01826, Paper 18; IPR 2015-01593, Paper 24.

Moreover, the USPTO’s data demonstrates a large divergence between the allowance rate in reissue applications (>60% allowed based on 2012-2016 data)[1] and the claims remaining patentable rate in IPR proceedings (~22% patentable as of December 31, 2016)[2].  Thus, the likelihood of inconsistent results between the proceedings is high.

Another potential basis for a stay is that issuance of a co-pending reissue application would divest the PTAB of its review authority and thus result in a waste of its resources. After all, the PTAB has held that under 35 U.S.C. §§ 251 and 252, once a co-pending reissue application is issued, the original patent—i.e., the patent asserted in the IPR petition—is surrendered and ceases to exist, thereby necessitating termination of the IPR. See IPR2013-00513, Paper 11 (denying institution because after the petition was filed, the original patent asserted in the petition was reissued, resulting in the surrender of the original patent).

Stay of a co-pending reissue application may also be denied for a variety of reasons. The PTAB has denied requests to stay a reissue application, for example, because the patent owner stipulated that it would not amend the issued claims in the reissue proceeding or because the petitioner’s speculation regarding possible claim amendments was insufficient to support a stay and the patent owner sought to add a number of dependent claims to the patent at issue, which it could not do in the IPR proceeding.  See IPR2014-00041, Paper13; IPR2014-01002, Paper 24. However, in reissue applications where the patent owner seeks to maintain at least some identical claims and add new dependent claims, the PTAB has granted stay for the same reasons discussed above.  See IPR2017-00190, Paper 31.A stay in the reissue proceeding is beneficial to the petitioner because under 37 C.F.R. § 42.73(d)(3), a patent owner is estopped from obtaining in the reissue proceeding “[a] claim that is not patentably distinct” from a claim that is canceled in the IPR. Also, a stay of the reissue proceeding thereby delays the grant of a reissued patent, which effectively shortens the patent term because the patent is reissued according to 35 U.S.C. § 251 for only “the unexpired term of the original patent.” Moreover, the petitioner is an active participant in the IPR, as opposed to a bystander for the reissue proceeding.A stay in the reissue proceeding is beneficial to the petitioner because under 37 C.F.R. § 42.73(d)(3), a patent owner is estopped from obtaining in the reissue proceeding “[a] claim that is not patentably distinct” from a claim that is canceled in the IPR. Also, a stay of the reissue proceeding thereby delays the grant of a reissued patent, which effectively shortens the patent term because the patent is reissued according to 35 U.S.C. § 251 for only “the unexpired term of the original patent.” Moreover, the petitioner is an active participant in the IPR, as opposed to a bystander for the reissue proceeding.

A stay in the reissue proceeding is beneficial to the petitioner because under 37 C.F.R. § 42.73(d)(3), a patent owner is estopped from obtaining in the reissue proceeding “[a] claim that is not patentably distinct” from a claim that is canceled in the IPR. Also, a stay of the reissue proceeding thereby delays the grant of a reissued patent, which effectively shortens the patent term because the patent is reissued according to 35 U.S.C. § 251 for only “the unexpired term of the original patent.” Moreover, the petitioner is an active participant in the IPR, as opposed to a bystander for the reissue proceeding.

A motion to stay a related reissue proceeding can be sought prior to institution of an IPR and/or subsequent to institution. Requests for stay have had varied outcomes with some being denied and some being granted at both the pre-institution stage and post-institution stage.  However, the stage of the proceeding appears to matter as stays are more often issued post-institution. Indeed, in two cases, the PTAB expressly held that consideration of a stay prior to institution would be “premature.” See IPR2015-01690, Paper 8; IPR2017-00190, Paper 11. Similarly, the PTAB has issued a post-institution stay sua sponte in at least two cases. See IPR2016-01464, Paper 13; IPR2015-01826, Paper 18 (against the contention of both parties).

The below table provides an analysis of IPRs that have involved requests and orders to stay related co-pending reissue proceedings. The table contains a breakdown of these cases based on several factors, including when the reissue application was filed, when a stay was first requested or considered, and whether the patent owner opposed the stay. Based on the data, the following observations can be drawn:

  • A reissue application is more likely to be stayed after the related co-pending IPR has been instituted.
    • In the five cases where a stay was requested prior to institution, a pre-institution stay was granted one time, denied three times, and rendered moot one time. In the case where a stay was granted, the patent owner did not oppose the stay.
    • In the six cases where a reissue application was co-pending prior to institution and a stay was considered after institution, a post-institution stay was granted three times, denied two times, and rendered moot once.
    • In the four cases where a reissue application was co-pending prior to institution and a stay was first requested (or sua sponte considered) after institution, a post-institution stay was granted two times, denied once, and rendered moot once.
    • In the ten cases where a stay was considered after institution but before a final decision, a post-institution stay was granted seven times, denied two times, and rendered moot once.
  • A reissue application is more likely to be stayed if it was filed after the related IPR petition—especially if filed after the related IPR petition has been instituted.
    • A post-institution but pre-final decision motion to stay has not been denied for a reissue application filed after the co-pending IPR petition. In the seven cases where a reissue application was filed after the IPR petition but before a final written decision, a post-institution but pre-final decision motion to stay was granted six times and rendered moot once.
  •  A reissue application is unlikely to be stayed after a final written decision given that the IPR proceeding is no longer pending before the USPTO, unless a motion for rehearing has been filed.

While the data demonstrate a trend toward grant of stays, particularly where the post-grant challenge is instituted, uncertainty as to the PTAB’s likelihood of granting a stay in any particular case remains an issue given the small sample size and mixed results thus far.  The high likelihood of inconsistent results between IPR and reissue proceedings militates towards granting of stays pending the outcome of the PTAB proceeding, particularly in view of the short twelve-month IPR window.

[1] USPTO Annual Report 2016, available at https://www.uspto.gov/sites/default/files/documents/USPTOFY16PAR.pdf.

[2] Patent Trial and Appeal Board Statistics, available at https://www.uspto.gov/sites/default/files/documents/aia_statistics_december2016.pdf.