PTAB Litigation 2016 Part 4 – The Institution Decision

Institution Decision

Institution Decision Typically about 6 months after the Petition is filed, the Board will give an initial thumbs up/down on the grounds presented by the petitioner; Based on petition and any arguments provided by patent owner in Preliminary Response; Board provides a detailed account of its current read of substantive issues in the case; Can deny some or all of the grounds if those grounds fail to meet the reasonable likelihood standard or are otherwise lacking (e.g., redundancy).

Institution Decision Board Panel Makeup: 3 Administrative Patent Judges (“APJs”), designated by Chief Judge; Occasionally may expand to 5+ APJs (including original 3), e.g., if: issue of exceptional importance; conflicting decisions; Commissioner’s request (first impression, decision against public interest); 1 or 2 APJs may decide institution or rehearing on institution.

Institution Decision Standard: No institution unless: “reasonable likelihood”; at least one challenged claim; is unpatentable (§ 102, 103); Board may institute: all or only some claims; on all or only some grounds raised. (37 C.F.R. § 42.108.)

Institution Decision Timing: Within 3 Months of POPR deadline/filing: “The Board acting on behalf of the Director will determine whether to institute a trial within three months of the date the patent owner’s preliminary response was due or was filed, whichever is first.” 77 Fed. Reg. 48757. “The Board may take up petitions or motions for decisions in any order, may grant, deny, or dismiss any petition or motion, and may enter any appropriate order.” 37 C.F.R. § 42.71(a).

Institution Decision Statistics: FY2015 – 69% instituted counting joinder cases; 66% instituted ignoring joinder cases. Historic rate – 73% instituted counting joinder cases; 71% instituted ignoring joinder cases. Contrast with early rates of around 85%. Source: http://www.uspto.gov/sites/default/files/documents/2015-07-31%20PTAB.PDF * as of 7/31/2015

Institution Decision Requests for Rehearing: Rehearing requests may be filed by both Petitioner and Patent Owner; No preauthorization necessary; “abuse of discretion” standard – must identify an argument that was made that the panel “misapprehended or overlooked;” No tolling; Time to file request: Some grounds denied, some instituted: within 14 days; Decision not to institute trial: within 30 days. (37 C.F.R. § 42.71(c),(d).)

Institution Decision Appeal: Not permitted: “A decision by the Board on whether to institute a trial is final and nonappealable.” 37 C.F.R. § 42.71(c). St. Jude Medical, Cardiology Div., Inc. v. Volcano Corp., 749 F.3d 1373, 1375 (Fed. Cir. 2014) (held Director’s decision not to institute IPR may not be appealed to Federal Circuit); In re Dominion Dealer Solutions, LLC., 749 F.3d 1379, 1381 (Fed. Cir. 2014) (denied mandamus petition challenging Director’s decision not to institute IPR); In re P&G Co., 749 F.3d 1376, 1379 (Fed. Cir. 2014) (denied mandamus petition challenging Director’s decision to institute IPR); Dominion Dealer Solutions, LLC v. Lee, 111 U.S.P.Q.2d 1400, 1405 (E.D. Va. 2014) (held district court lacks subject matter jurisdiction over action seeking review of decision whether to institute IPR).