The Board has broad discretion to deny “follow-on” petitions under 35 U.S.C. § 314(a) and 37 C.F.R. § 42.108(a). When determining whether to institute follow-on petitions, the Board should consider the seven NVIDIA factors.
Takeaway (2) (Informative):
The Chief Judge may expand a panel on a “suggestion” from a judge, panel, or party in a post-grant review. The standard operating procedure (PTAB SOP 1, 3 (§ III.A)) exemplifies some of the reasons why the Chief Judge might decide to expand a panel, for example [t]he proceeding or AIA Review involves an issue of exceptional importance.”
When considering a request for rehearing, the Board reviews its decision for an abuse of discretion, which may arise if the decision is based on an erroneous interpretation of law, if a factual finding is not supported by substantial evidence, or if an unreasonable judgment is made in weighing relevant factors. The party requesting rehearing bears the burden of showing that the decision should be modified by identifying all matters the party believes were misapprehended or overlooked, and the place where each matter was addressed previously in a motion, opposition, or a reply.
Summary (Chief Judge Ruschke, Deputy Chief Judge Boalick and Judges Lee, Zecher, Giannetti, Bisk and McShane):
Petitioner General Plastic Industrial Co., Ltd. (“GP”) filed two IPR petitions – one challenging U.S. Patent Nos. 9,046,820 B1 (“the ’820 Patent”) and the other challenging 8,909,094 B2 (“the ’094 Patent”). The Board denied institution of the petitions on the merits. Nine months after filing the first petitions, GP filed multiple follow-on petitions against each patent citing newly discovered art. The Board exercised its discretion and denied institution of the follow-on petitions pursuant to 35 U.S.C. § 314(a) and 37 C.F.R. § 42.108(a).
GP requested a rehearing and an expanded panel. The Chief Judge decided to expand the panel to discuss the factors that the Board should consider in determining whether to deny petitions under 35 U.S.C. § 314(a) and 37 C.F.R. § 42.108(a).
The expanded panel held that the Board should consider the following seven (non-exhaustive) factors set forth in NVIDIACorp. v. Samsung Elec. Co., Case IPR2016-00134 (PTAB May 4, 2016) (Paper 9) in determining whether to institute follow-on petitions:
- whether the same petitioner previously filed a petition directed to the same claims of the same patent;
- whether at the time of filing of the first petition the petitioner knew of the prior art asserted in the second petition or should have known of it;
- whether at the time of filing of the second petition the petitioner already received the patent owner’s preliminary response to the first petition or received the Board’s decision on whether to institute review in the first petition;
- the length of time that elapsed between the time the petitioner learned of the prior art asserted in the second petition and the filing of the second petition;
- whether the petitioner provides adequate explanation for the time elapsed between the filings of multiple petitions directed to the same claims of the same patent;
- the finite resources of the Board; and
- the requirement under 35 U.S.C. § 316(a)(11) to issue a final determination not later than 1 year after the date on which the Director notices institution of review.
The expanded panel stated that these factors “serve to act as a baseline of factors to be considered in our future evaluation of follow-on petitions.”
The expanded panel found that the factors weighed against institution in this case. The follow-on petitions addressed the same claims as the first-filed petitions. GP provided no explanation why it could not have found this new prior art prior to filing the first-filed petitions through the exercise of reasonable diligence. GP filed the follow-on petitions after it had an opportunity to consider the Patent Owner’s Preliminary Response, the Board’s Decisions Denying Institution, and the Decisions Denying Rehearing regarding the first-filed petitions. GP provided “no meaningful explanation” for why it took nine months before filing the follow-on petitions.
The expanded panel rejected GP’s argument that the follow-on petitions with new prior art were justified due to the “surprising” nature of the Board’s decision that the “toner supply container” in the preamble was a structural limitation of the claims, because, the panel concluded, GP’s alleged surprise was unreasonable. Furthermore, the expanded panel noted that the follow-on petitions were seemingly used to correct deficiencies in the first-filed petitions that were unrelated to the alleged “surprise.”
The expanded panel stated that the Board is “mindful of the goals of the AIA—namely, to improve patent quality and make the patent system more efficient by the use of post-grant review procedures. See H.R. Rep. No. 112-98, pt. 1, at 40 (2011).” The Board also recognized the potential for abuse of the review process through repeated attacks on patents, stating that:
The absence of any restrictions on follow-on petitions would allow petitioners the opportunity to strategically stage their prior art and arguments in multiple petitions, using our decisions as a roadmap, until a ground is found that results in the grant of review
The decision is a win for patent owners who favor limiting “follow-on” petitions. The decision leaves no room for doubt that petitioners must present strong arguments regarding why the NVIDIA factors favor the institution of a follow-on petition. Unfortunately, the Board failed to provide guidance regarding circumstances under which factor number 2 might favor the petitioner.