PTAB Grants Two Motions to Amend in March -- Aberration or Sign of Things to Come?

By Andrew Williams --

The U.S. Patent and Trademark Office appears to have taken the position that neither party has the burden of persuasion with regard to Motions to Amend after the Aqua Products v. Matal en banc decision (see "Motions to Amend at the PTAB -- Does Anyone Have the Burden (And Will That Change)?").  It was unclear, however, whether this position would have any practical impact for parties appearing before the Patent Trial and Appeal Board.  Correspondingly, the Board's grant of two Motions to Amend last month is revealing.  These are the first two motions that were granted outright since Aqua Products, both of which occurred in IPRs entitled Apple Inc. v. Realtime Data LLC, with both being directed to U.S. Patent No. 8,880,862.  Before this, the Board had only granted-in-part two additional motions:  (1) Taiwan Semiconductor Manufacturing Co. v. Godo Kaisha IP Bridge (IPR2016-01249) at the end of last year (see "More Aqua Products Fallout -- Taiwan Semiconductor Manufacturing Co. v. Godo Kaisha IP Bridge"); and (2) Polygroup Ltd. v. Willis Electric Co. (IPR2016-01613) in February (although to be fair, the contingent part of this motion was denied because the challenged claims were found to not be unpatentable).  Clearly, the flood gates have not been opened with respect to claim amendments in IPR proceedings because there have still been many more motions denied than granted (even in part).  But these two Apple v. Realtime Data cases could be instructive for Patent Owners seeking to amend claims in a post-Aqua Products world, especially with respect to whether the petitioner bears the burden with regard establishing the unpatentability of the substitute claims.

The technology at issue in the '862 patent was "[s]ystems and methods for providing accelerated loading of operating system and application programs upon system boot or application launch . . . ."  Id., Abstract.  As explained in one of the motion decisions, Realtime Data proposed adding four limitations to the issued claims in response to the instituted grounds:  "(1) preloading a portion of boot data; (2) into a volatile memory, the portion of boot data in the compressed form being associated; (3) wherein the preloading comprises transferring the portion of boot data in the compressed form into the volatile memory, and wherein the preloading occurs during the same boot sequence in which a boot device controller receives a command over a computer bus to load the portion of boot data; and (4) accessing the preloaded portion of the boot data in the compressed form from the volatile memory."  IPR2016-01737, Paper 57 at 46-47.  The Patent Owner argued in the motions that none of the cited prior art references taught or suggested "preloading" of compressed boot data into a "volatile" memory.

The Board first determined that Realtime Data had satisfied 37 C.F.R. § 42.121.  In IPR2016-01737, the Patent Owner proposed substituting 55 claims for the 55 challenged claims, while in IPR2016-01738, the Patent Owner proposed 45 claims to substituted for the 45 challenged claims.  Nevertheless, because there was a one-for-one correspondence, the number of claims was determined to be reasonable.  In addition, the Patent Owner had identified support in the original specification for the newly added limitations, for example where support could be for the limitation that the preloading may occur in volatile memory.  Moreover, the Board determined that these limitations were narrowing and did not add new subject matter.  Finally, the Board found that these proposed narrowing limitations were in direct response to the instituted grounds of unpatentability.  Correspondingly, the Patent Owner had met its burden with regard to the statutory and procedural requirements for the Motion to Amend.

The Board then turned to whether the proposed substitute claims were patentable over the prior art.  At first, the Board appeared to again suggest that neither party had the burden by citing to Aqua Products and the Chief Judge's guidance in explaining the requirement that unpatentability be determined based on the "entirety of the record, including any opposition made by the petitioner."  See, e.g., IPR2016-01737, Paper 57 at 46.  However, two sentences later, the Board seemed to place the burden squarely on the petitioner when it "determine[d] that Petitioner fail[ed] to establish that proposed substitute claims 118-173 are obvious over" the cited art.  Id.     

Even more telling was a discussion by the Board of the claim limitation for "preloading" boot data into "volatile" memory.  The Patent Owner had contended that even though one of the cited references, Zwiegincew, discussed the use of "boot" in its background section, it did not do so in the context of preloading boot data into volatile memory.  The Patent Owner also pointed out that two of the other references, Burrow and Dye, did not teach or suggest this limitation.  In fact, Patent Owner noted that Petitioner cited these references for their teaching regarding compression/decompression, and not for the newly added claim limitation.  The Petitioner, on the other hand, did not address any of these three references individually.  However, instead of stating that the claim limitation was not met by the cited art after reviewing "the entirety of the record," the Board instead concluded that it found "that Petitioner fail[ed] to establish that Zwiegincew, Burrow or Dye teach or suggest 'preloading' boot data into 'volatile' memory."  Id.  at 51.

Therefore, even though the Board did conclude its grant of the Motion to Amend by noting "that when considering the entirety of the record before us, we determine that the preponderance of the evidence fails to establish that the proposed substitute dependent claims are unpatentable," it did appear to put the burden on petitioner to reach that conclusion.  It is unclear whether this case is an aberration, or whether there will be more emphasis on the burdens assigned to petitioners in Motions to Amend going forward.  It is also unclear whether this case will make it easier for patent owners to get similar motions granted in the future.  Nevertheless, some of the language found in these two cases should be considered persuasive for patent owners to use going forward.

Apple, Inc. v. Realtime Data LLC, Case IPR2016-01737 (PTAB 2018)
Panel: Administrativbe Patent Judges Stpehens, Braden, and Chung
Final Written Decision by Administrative Patent Judge Braden

Apple, Inc. v. Realtime Data LLC, Case IPR2016-01738 (PTAB 2018)
Panel: Administrativbe Patent Judges Stpehens, Braden, and Chung
Final Written Decision by Administrative Patent Judge Braden

Comments

[EG]

Hey Andrew,

Whether "neither party has the burden of persuasion with regard to Motions to Amend after the Aqua Products" would "have any practical impact for parties appearing before [PTAB]," it's still appalling that PTAB acts in this rogue manner as to the rules governing IPRs. Frankly, PTAB is bucking for an adverse APA ruling.

[Skeptical]

Even the "olive branch" offering smacks of the administrative agency having no regard for anything but its own views (and survival, albeit they seem NOT to get in their own way, seeing what they have done while Oil States is still in front of the Supremes - vis a vis at least the sovereign immunity situation of American Indian Tribes).

[Paul F. Morgan]

Although IPR claim amendment procedural improvements appear to be needed, the statement here that "there have still been many more motions denied than granted (even in part)" has to be taken in context with the fact that only a small percentage of patent owners ever even attempt to amend any of their IPR subject claims, and some of those attempts are made way too late.
If the PTO Director changes IPR claim interpretation from BRI to Philips it may encourage even more patent owners to risk not amending claims by unrealistic expectations of more difference than there actually is in most cases.

[Skeptical]

I do not see how you get to "risk not amending claims" through this supposed "unrealistic expectations" of "more difference than there actually is."

There is either a difference (generally), or there is not.

If not, then going away from BRI will have no effect (one way or another).

If a difference exists, then going away from BRI should be effected.

Either way, there is no reason - no cogent reason - to stay with BRI.