By Andrew Williams --
The U.S. Patent and Trademark Office published a notice of proposed Rulemaking in the Federal Register (83 Fed. Reg. 21221) today which would provide a change to the claim construction standard used in Inter Partes Reviews (IPRs), Post-Grant Proceedings (PGRs), and Covered Business Method Reviews (CBMs). Instead of the broadest reasonable interpretation ("BRI") standard originally adopted, and blessed by the Supreme Court in Cuozzo Speed Technologies LLC v. Lee, the proposed rulemaking would adopt the same standard used by district courts and the ITC. The use of a harmonized standard has been long advocated by patent holders, specifically because they are faced with an unfair dichotomy -- a more stringent construction when alleging infringement, but a broader construction when faced with an allegation of unpatentability at the PTAB. Or, as the Office acknowledged in the notice, it is possible that "even if a competitor's product would not be found to infringe a patent claim if it was sold after the patent's effective filing date, the same product nevertheless could constitute invaliding prior art if publically sold before the patent's effective filing date." Nevertheless, over time, the BRI standard for post-issuance proceedings has been refined by the Federal Circuit to the extent that it was almost approaching the Phillips standard anyway. In fact, cases in which the claim construction standard has been outcome determinative are few and far between. Still, this effort to harmonize the construction of issued claims regardless of which tribunal is considering the issue is welcome and long overdue.
Specifically, the Patent Office is proposing amending 37 C.F.R. §§ 42.100(b), 42.200(b), and 42.300(b) to replace the first sentence with the following: "a claim of a patent, or a claim proposed in a motion to amend, 'shall be construed using the same claim construction standard that would be used to construe such claim in a civil action to invalidate a patent under 35 U.S.C. 282(b), including construing the claim in accordance with the ordinary and customary meaning of such claim as understood by one of ordinary skill in the art and the prosecution history pertaining to the patent.'" The Office, in other words, would begin applying the principles that were articulated by the Federal Circuit in Phillips and its progeny. This would include taking into account the claim language, the specification, and the prosecution history (including any other post-issuance proceeding), as well as relevant extrinsic evidence. Moreover, the Office is proposing amending each of these sections to add the following sentence: "Any prior claim construction determination concerning a term of the claim in a civil action, or a proceeding before the International Trade Commission, that is timely made of record in the . . . proceeding will be considered." Finally, the Office proposes removing the language for a different standard for claims in an expired (or expiring) patent because there would no longer be a need for a distinction. Importantly, these proposed rule changes "would be applied to all pending IPR, PGR, and CBM proceedings before the PTAB." As a result, practitioners with pending proceedings will likely need to account for the two different standards during the transition.
One of the stated reasons for this change was the goal of implementing "a fair and balanced approach, providing greater predictability and certainty in the patent system." In making this claim, the Board pointed to PPC Broadband, Inc. v. Corning Optical Comm'ns RF, LLC, 815 F.3d 734 (Fed. Cir. 2016). In that case, the Court noted that it "hinge[d] on the claim construction standard applied—a scenario likely to arise with frequency. And in this case, the claim construction standard is outcome determinative." Id. at 740-42. Nevertheless, it is unclear how frequent such cases have been, as there were very few (if any) subsequent cases decided by the Federal Circuit that had such an outcome. In fact, over time, the two standards seemed to be converging. It began with the admonition in Microsoft Corp. v. Proxyconn, Inc., in which the Federal Circuit pointed out that a BRI construction still had to be that -- reasonable. In fact, the Court warned in Trivascular, Inc. v. Samuels in February of 2016 that the PTAB does not have an "unfettered license" to construe claims inconsistent with the specification and prosecution history. Instead, the Court concluded that any construction must reflect the "ordinary" and "customary" meaning of the terms as understood by those skilled in the art. Clearly, by this point, the two different standards were already appearing to be not as far apart as originally feared.
For those wishing to submit comments, the deadline is July 9, 2018. Comments can be sent via e-mail to PTABNPR2018@uspto.gov, or they can be sent via the Federal eRulemaking Portal at https://www.regulations.gov. All such submitted comments should include the docket number (PTO-P-2018-0036). Comments can also be submitted by postal mail, but the Office would prefer electronic submissions to more easily share the comments. The Notice also provides that if further information is required, please contact Michael Tierney and Jacqueline Wright Bonilla, Vice Chief Administrative Patent Judges, by telephone at (571) 272-9797. And, of course, we will monitor comments and provide updates as warranted.