On January 24, 2019, the PTAB denied institution of inter partes review (“IPR”) in Deeper, UAB v. Vexilar, Inc., Case IPR2018-01310 (PTAB Jan. 24, 2019) (Paper 7). The PTAB exercised its discretion to deny institution despite finding that Deeper demonstrated a reasonable likelihood of success in prevailing as to two of the twenty-three claims it challenged.

Deeper filed a petition requesting review of claims 1-23 of U.S. Patent No. 9,628,592 (“the ’592 patent”). The claims of the ’592 patent are directed to a water regimen detecting device that detects fish and uses WIFI to communicate with a user. Deeper asserted four grounds of unpatentability based on obviousness. Every claim was challenged on two grounds of unpatentability.

Upon considering the evidence, the PTAB held that Deeper failed to demonstrate claims 1-21 were obvious over the prior art references. Deeper relied on conclusory, unsupported testimony to prove obviousness. Deeper’s expert provided no analysis or evidence to support his conclusions. However, the PTAB concluded that Deeper demonstrated a reasonable likelihood of prevailing in its obviousness challenge to claims 22 and 23. The PTAB found that Deeper sufficiently explained how the additional limitations of claims 22 and 23 were taught by the prior art.

Despite finding a reasonable likelihood of success as to two of the claims, the PTAB, relying on 35 U.S.C. § 314(a), declined to institute IPR. Section 314(a) provides that an IPR may not be instituted “unless the Director determines that the information presented in the petition…shows that there is a reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims challenged in the petition.” In light of the Supreme Court’s recent decision in SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018), when the PTAB institutes IPR of a challenged patent, it must decide the patentability of all of the claims challenged by the petitioner (you can read more about the decision in this post) . However, the Supreme Court further noted that “[Section] 314(a) invests the Director with discretion on the question whether to institute review…” Id. at 1356.

Here, the PTAB reasoned that “even when a petitioner demonstrates a reasonable likelihood of prevailing with respect to one or more claims, institution of review remains discretionary.” See Paper 7 at 42. The PTAB went on to explain that when exercising its discretion, it is guided by the statutory requirement, “to consider the effect of any regulations on the efficient administration of the Office and the ability of the Office to timely complete proceedings, 35 U.S.C. § 316(b), as well as the requirement to construe our rules to ‘secure the just, speedy, and inexpensive resolution of every proceeding.’” Id. (citing 37 C.F.R. § 42.1(b)). The PTAB also noted that the USPTO’s recent June 5, 2018 guidance provides that, when deciding whether to institute IPR under 35 U.S.C. § 314(a), it may consider the number of claims and grounds that meet the reasonable likelihood standard.  Based on this reasoning, the PTAB exercised its discretion to deny institution, concluding that instituting review on all twenty-three claims on all four grounds based on evidence directed to only two of the challenged claims would not be an efficient use of the PTAB’s time and resources. See id. at 43.

Petitioners should be cognizant of this decision. Following the Supreme Court’s decision in SAS Institute Inc. v. Iancu, the PTAB appears to be much more mindful of the breadth of challenges being asserted and whether institution would be an efficient use of the PTAB’s time. Because institution of IPR now requires the PTAB to decide the patentability of all of the claims challenged by the petitioner, overly broad challenges may lead to the denial of a petition. Thus, going forward petitioners should carefully consider the claims they wish to challenge as well as the grounds of unpatentability they wish to assert.