March 2019, Motion to Amend Mania!!!!!!!!!!!!

March was maddening for reasons unrelated to basketball this year, last month motions to amend took centerstage at the Patent Office. A barrage of changes were made to AIA trials with respect to motions to amend (or MTAs): burdens have conclusively shifted, two precedential opinions from the Patent Trial and Appeal Board have issued, a new pilot program is underway and last year’s stats are out. One might call it a “patentpalooza!”

IPRs and PGRs allow patentees an attempt to salvage patents by amending claims in response to patentability challenges. 35 USC §316(d)(“[d]uring an inter partes [sic] review instituted under this chapter, the patent owner may file 1 motion to amend the patent…”); see also, 35 USC §326(d). Prior to October of 2017, a patentee moving to amend claims carried the burden of establishing the patentability of a proposed substitute claim by a preponderance of the evidence. In October of 2017, the Court of Appeals, sitting en banc, ruled that the Board was without authority to place the ultimate burden of proof on patentees in motions to amend absent an amendment to the Code of Federal Regulations. Aqua Products; see also Aqua Products v. US PTO, The Burden of Persuasion on Post-Grant Amendments, Just Intellectuals eNewsletter (Nov. 2017). Such an amendment to the CFR has yet to occur. Just the opposite is true, there has been every indication that the Patent Office has no plans to re-shift the burden of proof back onto patentees.

The PTAB went decisively insane for MTAs in March, designating Lectrosonics, Inc. v. Zaxcom, Inc. a precedential opinion. Case IPR2018-01129 & -01130 (PTAB Feb. 25, 2019)(Paper No. 15)(providing information and guidance on motions to amend). Lectrosonics clarified that the Board has no present intention of changing the burden of proof on motions to amend. p4.

"In accordance with Aqua Products, the Board’s Memorandum, and Bosch, a patent owner does not bear the burden of persuasion to demonstrate the patentability of substitute claims presented in a motion to amend. Rather, as a result of the current state of the law and USPTO rules and guidance, the burden of persuasion ordinarily will lie with the petitioner to show that any proposed substitute claims are unpatentable by a preponderance of the evidence. The Board itself also may justify any finding of unpatentability by reference to evidence of record in the proceeding, for example, when a petitioner ceases to participate, as further noted in Aqua Products and Bosch."

Lectrosonics provides further guidance on motions to amend including clarifying that: (a) while substitute claims can be presented on contingency, claim cancellation cannot, p3; (b) MTAs must be responsive to grounds of unpatentability already raised in the trial, pp5-6; (c) the claims cannot add new matter without support in the original disclosure, pp7-8; and (d) all parties have a duty of candor to disclose information material to the patentability of substitute claims, pp9-10. The duty of candor extends to added limitations presented by patent owners and information that is inconsistent with a position advanced by either party. Id. citing 37 CFR §§42.11 & 42.51(b)(1)(iii).

The madness continued March 18, 2019 when the PTAB also designated Amazon.com, Inc. v. Uniloc Luxembourg S.A. a precedential opinion. Case IPR2017-00948 (PTAB Jan. 18, 2019)(Paper No. 34)(affirming the unpatentability of proposed substitute claims on the basis of §101). In Amazon, the Board reheard a patent owner’s contention that Aqua Products not only shifted the burden of proof away from patent owners on motion to amend but also limited a petitioner’s grounds for contesting the amendment to §§102 and 103, citing §311(b)’s limitation on existing claims. The panel distinguished §311’s management of existing claims from §316’s treatment of proposed substitute claims stating that “[i]n contrast to §311(b), the statutory provision providing a right to a motion to amend, 35 U.S.C. §316(d), does not prevent us from considering unpatentability under sections other than § 102 and § 103 with respect to substitute claims.” p5.

Three days earlier the Board persisted down its path of hysteria, starting a one-year pilot program for MTAs that allows the Board, when requested, to issue a preliminary non-binding decision on the merits of a motion to amend. Request for Comments on Motion to Amend Practice and Procedures in Trial Proceedings Under the America Invents Act Before the Patent Trial and Appeal Board, 83 Fed. Reg. 54,319-326 (Oct. 29, 2018) and Notice Regarding a New Pilot Program Concerning Motion to Amend Practice and Procedures in Trial Proceedings Under the America Invents Act Before the Patent Trial and Appeal Board, 84 Fed. Reg. 9,497-507 (Mar. 15, 2019). The nameless Pilot applies to all AIA trial proceedings instituted on or after March 15, 2019. Its purpose is to indicate the reasonable likelihood that the proposed substitute claims will be found patentable earlier in the process. When filing the MTA, a patent owner should request preliminary guidance from the Board. The petitioner has an opportunity to oppose the MTA. Should the petitioner not participate, however, the Board can solicit the Central Reexamination Unit for assistance. In response to the Board’s preliminary assessment or petitioner opposition a patent owner may simply reply, if needed, or revise their MTA. If the patent owner chooses to file a revised MTA, the Board will alter its scheduling order to accommodate additional briefing. The revised MTA should include one or more new proposed substitute claims and perhaps new argument and evidence (such as declarations) that are responsive to the preliminary decision and/or opposition. “Pilot X” should increase a patent owner’s chances of successfully amending claims.

Crazily enough, the Board released its latest installment of the PTAB Motion to Amend Study in March as well. (Installment 5). The stats indicate that “[t]he number of motions to amend filed in fiscal year 2018 (114) is more than the number of motions to amend filed in any other fiscal year and more than double the number of motions to amend filed in each fiscal year 2017 (50) and fiscal year 2016 (56).” That is likely due to Aqua. Notably, MTA grants increased last year between April and September; this may similarly be due to Aqua’s burden shifting. Out of the sixteen new MTAs decided during that period as many as 19% were granted or granted in part, versus only 9.5% prior to April of 2018.

With all this rapacious attention in one’s mind, the future looks bright for MTAs at the US Patent Office.