1. © 2015 Fox Rothschild Inter Partes Review Lessons Learned Scott R. Bialecki Fox Rothschild LLP June 24, 2015

2. The 10,000 Foot View Inter Partes Review (“IPR”) is a relatively new procedure under the AIA for challenging patent validity at the USPTO. Considered to be faster and have a better success rate than previous options. Only based on prior art patents or printed publications. 2

3. Inter Partes Review District Court Decided ByPTAB panelJudge/Jury Timing1.5 years1.5 – 4 years Burden of Proof Preponderance of the evidence Clear and convincing evidence Claim Construction Standard Broadest reasonable interpretation Construe to maintain validity IPR vs. District Court 3

4. Inter Partes ReviewEx Parte Reexam Decided ByPTAB PanelPatent Examiner Timing1.5 years 3 mos. to institute/ No final deadline Basis for Instituting Reasonable likelihood of success for at least 1 claim Substantial new question of patentability Estoppel Raised or could reasonably have been raised None Participation Throughout process/ right to appeal final decision Limited to initial filing/ no right to appeal final decision Basis Patents & printed publications Same IPR vs. Ex Parte Reexam 4

5. Final Written Decision Oral Hearing PO Reply on Motion to Amend Petitioner Reply & Opposition to Amendment PO Response & Motion to Amend Claims Decision on Petition PO Preliminary Response Petition Filed 3 months 7 months No more than 12 months* *Possible 6-month extension No more than 6 months 5

6. Timing WHEN: 6 IF IN LITIGATION, YOU MUST FILE IPR PETITION WITHIN 1 YEAR OF COMPLAINT. Follow the Five Month Rule. PTAB makes institution decisions within 6 months. Five Month Rule leaves a 1 month turnaround.

7. Fees Can Add Up Quickly Petition 7 $9,000 + $200 for each claim over 20. (Non-refundable if petition denied) $14,000 + $400 for each claim over 15. (Refundable if petition is denied) Min USPTO Filing Fee = $23,000 Institution + Attorneys’ Fees +

8. 617 Petitions Filed (as of 1/15/15) 9,048 Claims Challenged 68% of Claims Challenged Were Instituted 32% of Claims Challenged Were Not Instituted Source: USPTO IPR Statistics (as of 1/15/15) 51% of Claims Instituted Did Not Survive IPR 8

9. What We’ve Learned: Estoppel Q: What counts as “could have raised”? A: This includes “prior art which a skilled searcher conducting a diligent search reasonably could have been expected to discover.” IPR2015-00549, Dkt. 10, at 5. 9 Concept: Estoppel applies only for grounds that petitioner raised or reasonably could have raised.

10. Practice Pointer: Estoppel Star Envirotech, Inc. v. Redline Detection, LLC, Case No. SACV 12-01861 JGB (DFMx) (C.D.Cal. 1/29/15) –Instruction manual case –LeakMaster A240 smoke machine “locating a heating element within a closed smoke producing chamber” TIP: Make sure to analyze manuals relating to devices to avoid estoppel issue 10

11. What We’ve Learned: Estoppel Cont’d Q: What counts as a “final written decision”? A: This does not include denial of a petition for institution. It only applies to the PTAB’s decisions after institution. 35 U.S.C. §§ 315(e)(2) and 318(a) 11 Concept: Estoppel applies only if there was a final written decision.

12. What We’ve Learned: Incorporation By Reference “The footnotes cite a total of seventeen pages, including eleven pages of claim charts, of Dr. Roy’s Declaration— substantially more pages than section VII-A in the Petition.... The practice, here, of using footnotes to cite large portions of another document, without sufficient explanation of those portions, amounts to [an improper] incorporation by reference.” IPR2014-00454, Dkt. 12, at 7-8. 12 Concept: The PTAB follows a strict 60-page, double-space, 14 pt. font rule. Petitioners who try to skirt this rule by incorporating exhibits by reference risk getting their petitions bounced.

13. What We’ve Learned: Staying District Court Litigation Q: What are ways to increase chances of a stay? A: You have a better chance of a stay if: You ask for it after the IPR is instituted; All patents, claims, and parties are involved in the IPR; and/or You can show minimal prejudice to opposing side. 13 Staying District Court litigation is not guaranteed, so proceed with caution. Concept: Staying District Court litigation is not guaranteed, so proceed with caution.

14. 4 Revised IPR Rules Effective May 19, 2015 Page Limits in Patent Owner’s Motion to Amend –25 pages (up from 15) / Opposition has same 25 page limit –Proposed amended claims can be presented in appendix Petitioner Reply Brief Page Limit –25 Pages (up from 15) Easier now to respond to Patent Owner Response brief of 60 pages Required Font –Font games are over: 14-point, Times New Roman Multiple Back-Up Counsel Allowed 14

15. The Fight Against Hedge Funds Abuse of IPR Process –Motion for Sanctions briefing moving forward Bass and related companies “abusing IPR process for private financial gain”; 37 C.F.R.§§ 42.12(a)(6), b(8) Celgene Corp., IPR2015-01102 (Jun. 9, 2015) Fail to Disclose All Investors: Real Parties-In-Interest –Motion for Additional RPI Discovery NPS Pharmaceuticals Inc., IPR2015-00990 (Jun. 3, 2015) –Preliminary Response Arguing Failure to Disclose RPIs Acorda Therapeutics, IPR2015-00720 (May 26, 2015) 15

16. Questions? Fox Rothschild LLP Scott R. Bialecki sbialecki@foxrothschild.com (303) 446-3851 16