[Federal Register Volume 83, Number 197 (Thursday, October 11, 2018)]
[Rules and Regulations]
[Pages 51340-51359]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-22006]
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DEPARTMENT OF COMMERCE
Patent and Trademark Office
37 CFR Part 42
[Docket No. PTO-P-2018-0036]
RIN 0651-AD16
Changes to the Claim Construction Standard for Interpreting
Claims in Trial Proceedings Before the Patent Trial and Appeal Board
AGENCY: United States Patent and Trademark Office, Department of
Commerce.
ACTION: Final rule.
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SUMMARY: The United States Patent and Trademark Office (``USPTO'' or
``Office'') revises the claim construction standard for interpreting
claims in inter partes review (``IPR''), post-grant review (``PGR''),
and the transitional program for covered business method patents
(``CBM'') proceedings before the Patent Trial and Appeal Board
(``PTAB'' or ``Board''). In particular, the Office is replacing the
broadest reasonable interpretation (``BRI'') standard such that claims
shall now be construed using the same claim construction standard that
is used to construe the claim in a civil action in federal district
court. This rule reflects that the PTAB in an AIA proceeding will apply
the same standard applied in federal courts to construe patent claims.
The Office also amends the rules to add that any prior claim
construction determination concerning a term of the claim in a civil
action, or a proceeding before the International Trade Commission
(``ITC''), that is timely made of record in an IPR, PGR, or CBM
proceeding will be considered.
DATES:
Effective Date: The changes in this final rule take effect on
November 13, 2018.
Applicability Date: This rule is effective on November 13, 2018 and
applies to all IPR, PGR and CBM petitions filed on or after the
effective date.
FOR FURTHER INFORMATION CONTACT: Michael Tierney and Jacqueline Wright
Bonilla, Vice Chief Administrative Patent Judges, by telephone at (571)
272-9797.
SUPPLEMENTARY INFORMATION:
Executive Summary
Purpose: This final rule revises the rules for IPR, PGR, and CBM
proceedings that implemented provisions of the Leahy-Smith America
Invents Act (``AIA'') providing for trials
[[Page 51341]]
before the Office, by replacing the BRI standard for interpreting
unexpired patent claims and substitute claims proposed in a motion to
amend with the same claim construction standard that would be used to
construe the claim in a civil action under 35 U.S.C. 282(b). The rule
adopts the same claim construction standard used by Article III federal
courts and the ITC, both of which follow Phillips v. AWH Corp., 415
F.3d 1303 (Fed. Cir. 2005) (en banc), and its progeny. Under the final
rule, the PTAB will apply in an AIA proceeding the same standard
applied in federal courts to construe patent claims. This final rule
also amends the rules to add a new provision which states that any
prior claim construction determination in a civil action or proceeding
before the ITC regarding a term of the claim in an IPR, PGR, or CBM
proceeding will be considered if that determination is timely filed in
the record of the IPR, PRG or CBM proceeding.
Summary of Major Provisions: The Office is using almost six years
of historical data, user experiences, and stakeholder feedback to
further shape and improve PTAB proceedings, particularly IPR, PGR, and
CBM proceedings (``AIA proceedings''). As part of the Office's
continuing efforts to improve AIA proceedings, the Office now changes
the claim construction standard applied in AIA proceedings involving
unexpired patent claims and substitute claims proposed in a motion to
amend. The Supreme Court of the United States has endorsed the Office's
ability to choose an approach to claim construction for AIA
proceedings. Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2144-46
(2016) (``That [the appropriate claim construction standard for AIA
proceedings] is a question that Congress left to the particular
expertise of the Patent Office.'').
In the notice of proposed rulemaking, the Office sought comments on
the Office's proposed changes to the claim construction standard used
for interpreting unexpired patent claims and substitute claims proposed
in a motion to amend. Changes to the Claim Construction Standard for
Interpreting Claims in Trial Proceeding Before the Patent Trial and
Appeal Board, 83 FR 21221 (May 9, 2018).
The Office received a total of 374 comments, including 297 comments
from individuals, 45 comments from associations, 1 comment from a law
firm, and 31 comments from corporations. The majority of the comments
were supportive of changing the claim construction standard along the
lines set forth in the proposed rule. For example, major bar
associations, industry groups, patent practitioners, legal professors
and scholars, and individuals all supported the change. The
commentators also provided helpful insights and suggested revisions,
which have been considered in developing this final rule. While there
was broad support expressed for using the federal court standard set
forth in the proposed rule, some commentators indicated that they were
opposed to the change. The Office appreciates the thoughtful comments
representing a diverse set of views from the various public stakeholder
communities. Upon careful consideration of the public comments, taking
into account the effect of the rule changes on the economy, the
integrity of the patent system, the efficient administration of the
Office, and the ability of the Office to timely complete instituted
proceedings, the Office adopts the proposed rule changes (with minor
deviations in the rule language, as discussed below). Any deviations
from the proposed rule are based upon a logical outgrowth of the
comments received.
In particular, this final rule fully adopts the federal court claim
construction standard, in other words, the claim construction standard
that is used to construe the claim in a civil action under 35 U.S.C.
282(b), which is articulated in Phillips and its progeny. This rule
states that the PTAB in an AIA proceeding will apply the same standard
applied in federal courts to construe patent claims. The claim
construction standard adopted in this final rule also is consistent
with the same standard that the Office has applied in interpreting
claims of expired patents and soon-to-be expired patents. See, e.g.,
Wasica Fin. GmbH v. Cont'l Auto. Sys., Inc., 853 F.3d 1272, 1279 (Fed.
Cir. 2017) (noting that ``[t]he Board construes claims of an expired
patent in accordance with Phillips . . . [and] [u]nder that standard,
words of a claim are generally given their ordinary and customary
meaning''). This final rule also revises the rules to add that the
Office will consider any prior claim construction determination
concerning a term of the claim that has been made in a civil action, or
a proceeding before the ITC, if that prior claim construction is timely
made of record in an AIA proceeding.
Costs and Benefits: This final rule is significant under Executive
Order 12866 (Sept. 30, 1993).
Background
On September 16, 2011, the AIA was enacted into law (Pub. L. 112-
29, 125 Stat. 284 (2011)), and within one year, the Office implemented
rules to govern Office practice for AIA proceedings, including IPR,
PGR, CBM, and derivation proceedings pursuant to 35 U.S.C. 135, 316 and
326 and AIA sec. 18(d)(2). See Rules of Practice for Trials Before the
Patent Trial and Appeal Board and Judicial Review of Patent Trial and
Appeal Board Decisions, 77 FR 48612 (Aug. 14, 2012); Changes to
Implement Inter Partes Review Proceedings, Post-Grant Review
Proceedings, and Transitional Program for Covered Business Method
Patents, 77 FR 48680 (Aug. 14, 2012); Transitional Program for Covered
Business Method Patents--Definitions of Covered Business Method Patent
and Technological Invention, 77 FR 48734 (Aug. 14, 2012). Additionally,
the Office published a Patent Trial Practice Guide to advise the public
on the general framework of the regulations, including the procedure
and times for taking action in each of the new proceedings. See Office
Patent Trial Practice Guide, 77 FR 48756 (Aug. 14, 2012).
Previously, in an effort to gauge the effectiveness of the rules
governing AIA proceedings, the Office led a nationwide listening tour
in April and May of 2014. During the listening tour, the Office
solicited feedback on how to make AIA proceedings more transparent and
effective by adjusting the rules and guidance to the public where
necessary. To elicit even more input, in June of 2014, the Office
published a Request for Comments in the Federal Register and, at public
request, extended the period for receiving comments to October 16,
2014. See Request for Comments on Trial Proceedings Under the America
Invents Act Before the Patent Trial and Appeal Board, 79 FR 36474 (June
27, 2014) (``Request for Comments''). The Request for Comments asked
seventeen questions on ten broad topics, including a general catchall
question, to gather public feedback on any changes to AIA proceedings
that might be beneficial. See Request for Comments, 79 FR at 36476-77.
At least one question was directed to the claim construction standard.
Upon receiving comments from the public and carefully reviewing the
comments, the Office published two final rules in response to the
public feedback on this request for comments. In the first final rule,
the Office changed the existing rules to, among other things: (1)
Increase the page limit for patent owner's motion to amend by ten pages
and allow a claims appendix to be filed with the motion; and (2)
increase the page limit for petitioner's reply to patent owner's
response by ten pages. Amendments to the Rules of Practice for
[[Page 51342]]
Trials Before the Patent Trial and Appeal Board, 80 FR 28561 (May 19,
2015). In the second final rule, the Office changed the existing rules
to, among other things: (1) Allow new testimonial evidence to be
submitted with a patent owner's preliminary response; (2) allow a claim
construction approach that emulates the approach used by a district
court for claims of patents that will expire before entry of a final
written decision; (3) replace page limits with word count limits for
major briefing; and (4) add a Rule 11-type certification for papers
filed in a proceeding. Amendments to Rules of Practice for Trials
Before the Patent Trial and Appeal Board, 81 FR 18750 (April 1, 2016).
The Office last issued a rule package regarding AIA proceedings on
April 1, 2016. This final rule was based on comments received during a
comment period that opened on August 20, 2015 (only a month after the
Federal Circuit's July 2015 decision in the appeal of the first IPR
filed, Cuozzo Speed Technologies, LLC v. Lee) and that closed on
November 18, 2015. At that time, the appeal of the Federal Circuit's
decision in Cuozzo had not yet been decided by the Supreme Court (it
was decided on June 20, 2016). Due to the life cycle of AIA trial
proceedings and appeals, the comments received during this 2015 comment
period came when few Federal Circuit decisions had been issued, and
there had been no decisions on AIA appeals from the Supreme Court. From
2016 to present there has been a six-fold increase in the number of
opinions relating to AIA proceedings issued by the Federal Circuit as
compared to the prior 2012-2015 time frame. Additionally, since the
last rule package, the Office has continued to receive extensive
stakeholder feedback requesting adoption of the district court claim
construction standard for all patents challenged in AIA proceedings.
Many of the comments are based on case law and data that was not
available when the comments to the last rule package were received in
FY 2015. Further, recent studies not available at the time of the 2016
rule package support the concerns expressed by stakeholders regarding
the unfairness of using a different claim construction standard in AIA
proceedings than that used by the district courts. See Niky R. Bagley,
Treatment of PTAB Claim Construction Decisions: Aspiring to Consistency
and Predictability, 32 Berkeley Tech. L.J. 315, 355 (2018) (the
application of a different standard may encourage a losing party to
attempt a second bite at the apple, resulting in a waste of the
parties' and judicial resources alike); Kevin Greenleaf et al., How
Different are the Broadest Reasonable Interpretation and Phillips Claim
Construction Standards 15 (2018), available at http://www.ipo.org/wp-content/uploads/2018/07/BRI-v-Phillips-Final.pdf (prospect of differing
claim constructions for same claim term is troubling and these
differences can determine the outcome of a case); Laura E. Dolbow, A
Distinction without a Difference: Convergence in Claim Construction
Standards, 70 V and L. Rev. 1071, 1103 (2017) (maintaining the separate
standards presents problems with inefficiency, lack of uniformity, and
decreased confidence in patent rights).
Claim Construction Standard
Prior to this rulemaking, the PTAB construed unexpired patent
claims and proposed substitute claims in AIA proceedings using the BRI
standard. The BRI standard differs from the standard used in federal
courts and the ITC, which construe patent claims in accordance with the
principles that the United States Court of Appeals for the Federal
Circuit articulated in Phillips.
Although the BRI standard is consistent with longstanding agency
practice for patents in examination, the fact that the Office uses a
claim construction standard in AIA proceedings that is different from
that used by federal courts and the ITC means that decisions construing
the same or similar claims in those fora may be different from those in
AIA proceedings and vice versa. Minimizing differences between claim
construction standards used in the various fora will lead to greater
uniformity and predictability of the patent grant, improving the
integrity of the patent system. In addition, using the same standard in
the various fora will help increase judicial efficiency overall. One
study found that 86.8% of patents at issue in AIA proceedings also have
been the subject of litigation in the federal courts, and the Office is
not aware of any change in this percentage since this study was
undertaken. Saurabh Vishnubhakat, Arti K. Rai & Jay P. Kesan, Strategic
Decision Making in Dual PTAB and District Court Proceedings, 31
Berkeley Tech. L.J. 45 (2016) (available at https://ssrn.com/abstract=2731002). The high percentage of overlap between AIA
proceedings and district court litigation favors using a claim
construction standard in AIA proceedings that is the same as the
standard used by federal courts and the ITC. That is, the scope of an
issued patent should not depend on the happenstance of which court or
governmental agency interprets it, at least as far as the objective
rules go. Employing the same standard for AIA proceedings and district
courts improves uniformity and predictability as it allows the
different fora to use the same standards in interpreting claims. See,
e.g., Automated Packaging Sys., Inc. v. Free Flow Packaging Int'l,
Inc., No. 18-cv-00356, 2018 WL 3659014, at *3 (N.D. Cal. Aug. 2, 2018)
(finding that a party's failure to advance a particular claim
construction during an IPR proceeding ``is not probative to Markman
claim construction'' because material differences exist between the
broadest reasonable interpretation and claim construction under
Phillips); JDS Techs., Inc. v. Avigilon USA Corp., No. 15-cv-10385,
2017 WL 4248855, at *6 (E.D. Mich. Jul. 25, 2017) (holding that
arguments in IPR submissions are not relevant to claim construction
because ``the USPTO's broadest reasonable construction standard of
claim construction has limited significance in the context of patent
infringement, which is governed by the more comprehensive scrutiny and
principles required by Phillips and its progeny'').
In addition, having AIA proceedings use the same claim construction
standard that is applied in federal courts and ITC proceedings also
addresses the concern that potential unfairness could result from using
an arguably broader standard in AIA proceedings. According to some
patent owners, the same claim construction standard should apply to
both a validity (or patentability) determination and an infringement
determination. Because the BRI standard potentially reads on a broader
universe of prior art than does the Phillips standard, a patent claim
could potentially be found unpatentable in an AIA proceeding on account
of claim scope that the patent owner would not be able to assert in an
infringement proceeding. For example, even if a competitor's product
would not be found to infringe a patent claim (under the Phillips
standard) if it was sold after the patent's effective filing date, the
same product nevertheless could potentially constitute invalidating
prior art (under the BRI standard) if publicly sold before the patent's
effective filing date. As noted by one study, the possibility of
differing constructions for the same claim term is troubling,
especially when claim construction takes place at the same time in
parallel district court proceedings and USPTO proceedings. Greenleaf at
3.
The Office's goal is to implement a balanced approach, providing
greater predictability and certainty in the patent
[[Page 51343]]
system. The Office has carefully considered the submitted comments in
view of ``the effect of [the] regulation on the economy, the integrity
of the patent system, the efficient administration of the Office, and
the ability of the Office to complete timely the proceedings in
promulgating regulations.'' 35 U.S.C. 316(b) and 326(b). Under 35
U.S.C. 316(a)(4) and 326(a)(4), the Office shall prescribe regulations
establishing and governing IPR, PGR, and CBM proceedings and the
relationship of such reviews to other proceedings, including civil
actions under 35 U.S.C. 282(b). Under 35 U.S.C. 316(a)(2) and
326(a)(2), the Office must prescribe regulations ``setting forth the
standards for the showing of sufficient grounds to institute a
review.'' Congress intended these administrative trial proceedings to
provide ``quick and cost effective alternatives'' to litigation in the
courts. H.R. Rep. No. 112-98, pt. 1, at 48 (2011), as reprinted in 2011
U.S.C.C.A.N. 67, 78; see also id. at 40 (``[The AIA] is designed to
establish a more efficient and streamline patent system that will
improve patent quality and limit unnecessary and counterproductive
litigation costs.''). The claim construction standard could be outcome
determinative. PPC Broadband, Inc. v. Corning Optical Comm'ns RF, LLC,
815 F.3d 734, 740-42 (Fed. Cir. 2016) (noting that ``[t]his case hinges
on the claim construction standard applied--a scenario likely to arise
with frequency''); see also Rembrandt Wireless Techs., LP v. Samsung
Elecs. Co., 853 F.3d 1370, 1377 (Fed. Cir. 2017) (noting that ``the
Board in IPR proceedings operates under a broader claim construction
standard than the federal courts''); Google LLC v. Network-1 Techs.,
Inc., No. 2016-2509, 2018 WL 1468370, at *5 (Fed. Cir. Mar. 26, 2018)
(nonprecedential) (holding that ``[i]n order to be found reasonable, it
is not necessary that a claim be given its correct construction under
the framework laid out in Phillips.''). Using the same claim
construction standard as the standard applied in federal courts would
``seek out the correct construction--the construction that most
accurately delineates the scope of the claim invention--under the
framework laid out in Phillips.'' PPC Broadband, 815 F.3d at 740.
In this final rule, the Office revises the rules to provide that a
patent claim, or a claim proposed in a motion to amend, shall be
construed using the same claim construction standard that would be used
to construe the claim in a civil action 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. This
rule reflects that the PTAB in an AIA proceeding will apply the same
standard applied in federal courts to construe patent claims. This
change replaces the BRI standard for construing unexpired patent claims
and proposed substitute claims in IPR, PGR, and CBM proceedings with
the federal court claim construction standard, which is articulated in
Phillips and its progeny.
Under the amended rules as adopted in this final rule, the Office
will construe patent claims and proposed substitute claims in an IPR,
PGR, or CBM proceeding by taking into account the claim language
itself, the specification, the prosecution history of the patent, and
extrinsic evidence, among other things, as briefed by the parties.
Having the same claim construction standard for both the original
patent claims and proposed substitute claims will reduce the potential
for inconsistency in the interpretation of the same or similar claim
terms. Additionally, using the federal court claim construction
standard is appropriate because, among other things, amendments
proposed in AIA proceedings are required to be narrowing, are limited
to a reasonable number of substitute claims, and are required to
address patentability challenges asserted against the original patent
claims. Using the same claim construction standard for interpreting
both the original and amended claims also avoids the potential of added
complexity and inconsistencies between PTAB and federal court
proceedings, and this allows, among other things, the patent owner to
understand the scope of the claims and more effectively file motions to
amend. Additionally, having the same construction will reduce the
potential for situations where a claim term of an original patent claim
is construed one way under the federal court standard and yet the very
same or similar term is construed a different way under BRI where it
appears in a proposed substitute claim.
The Office will apply the standard used in federal courts, in other
words, the claim construction standard that would be used to construe
the claim in a civil action under 35 U.S.C. 282(b), which is
articulated in Phillips. This rule reflects that the PTAB in an AIA
proceeding will apply the same standard applied in federal courts to
construe patent claims. For example, claim construction begins with the
language of the claims. Phillips, 415 F.3d at 1312-14. The ``words of a
claim are generally given their ordinary and customary meaning,'' which
is ``the meaning that the term would have to a person of ordinary skill
in the art in question at the time of the invention, i.e., as of the
effective filing date of the patent application.'' Id. at 1312-13. The
specification is ``the single best guide to the meaning of a disputed
term and . . . acts as a dictionary when it expressly defines terms
used in the claims or when it defines terms by implication.'' Id. at
1321 (internal quotation marks omitted). Although the prosecution
history ``often lacks the clarity of the specification and thus is less
useful for claim construction purposes,'' it is another source of
intrinsic evidence that can ``inform the meaning of the claim language
by demonstrating how the inventor understood the invention and whether
the inventor limited the invention in the course of prosecution, making
the claim scope narrower than it would otherwise be.'' Id. at 1317.
Extrinsic evidence, such as expert testimony and dictionaries, may be
useful in educating the court regarding the field of the invention or
helping determine what a person of ordinary skill in the art would
understand claim terms to mean. Id. at 1318-19. However, extrinsic
evidence in general is viewed as less reliable than intrinsic evidence.
Id.
Additionally, to the extent that federal courts and the ITC apply
the doctrine of construing claims to preserve their validity as
described in Phillips, the Office will apply this doctrine in those
rare circumstances in AIA proceedings. Phillips, 415 F.3d at 1327-28.
As the Federal Circuit recognized in Phillips, this doctrine is ``of
limited utility.'' Id. at 1328. Federal courts have not applied that
doctrine broadly and have ``certainly not endorsed a regime in which
validity analysis is a regular component of claim construction.'' Id.
at 1327. The doctrine of construing claims to preserve their validity
has been limited to cases in which ``the court concludes, after
applying all the available tools of claim construction, that the claim
is still ambiguous.'' Id. (quoting Liebel-Flarsheim Co. v. Medrad,
Inc., 358 F.3d 898, 911 (Fed. Cir. 2004)). Moreover, the Federal
Circuit ``repeatedly and consistently has recognized that courts may
not redraft claims, whether to make them operable or to sustain their
validity.'' Rembrandt Data Techs., LP v. AOL, LLC, 641 F.3d 1331, 1339
(Fed. Cir. 2011); see also MBO Labs., Inc. v. Becton, Dickinson & Co.,
474 F.3d 1323, 1332 (Fed. Cir. 2007) (noting that ``validity
construction
[[Page 51344]]
should be used as a last resort, not first principle'').
When construing claims in IPR, PGR, and CBM proceedings, the Office
will take into account the prosecution history that occurred previously
at the Office, including before an examiner during examination,
reissue, reexamination, and prior AIA proceedings. Aylus Networks, Inc.
v. Apple Inc., 856 F.3d 1353, 1361 (Fed. Cir. 2017) (``Because an IPR
proceeding involves reexamination of an earlier administrative grant of
a patent, it follows that statements made by a patent owner during an
IPR proceeding can be considered during claim construction and relied
upon to support a finding of prosecution disclaimer.''). This will also
include prosecution before an examiner in a related application where
relevant (Trading Technologies Intern., Inc. v. Open E Cry, LLC, 728
F.3d 1309 (Fed. Cir. 2013)) and any argument made on appeal of a
rejection before the grant of the patent for which review is sought, as
those arguments are before the examiner when the decision to allow an
application is made (see TMC Fuel Injection System, LLC v. Ford Motor
Co., 682 Fed. Appx. 895 (Fed. Cir. 2017)).
During an AIA proceeding, the patent owner may file a motion to
amend an unexpired patent to propose a reasonable number of substitute
claims, but the proposed substitute claims ``may not enlarge the scope
of the claims of the patent or introduce new matter.'' 35 U.S.C. 316(d)
and 326(d); 37 CFR 42.121(a)(2) and 42.221(a)(2); see also Aqua Prods.,
Inc. v. Matal, 872 F.3d 1290, 1306 (noting that ``[t]he patent owner
proposes an amendment that it believes is sufficiently narrower than
the challenged claim to overcome the grounds of unpatentability upon
which the IPR was instituted''). As discussed above, and among other
things, having the same claim construction standard for both the
original patent claims and proposed substitute claims will reduce the
potential for inconsistency in the interpretation of the same or
similar claim terms.
The Office does not expect that this rule will result in direct
costs to applicable entities. The Office's understanding is informed
partly by the PTAB's experience in applying Phillips in some AIA trials
(as noted herein, PTAB has used Phillips for AIA trials concerning
expired patents since 2012 and for AIA trials concerning soon-to-be-
expired patents since 2016). In the PTAB proceedings that are currently
conducted using the Phillips standard, PTAB applies the same
procedures--including the same page limits and other briefing
requirements--as in the PTAB proceedings that use the BRI standard. In
other words, the PTAB currently uses the same regulations, procedures,
and guidance for both types of AIA trials: i.e., for both the AIA
trials that use the BRI standard as well as those AIA trials
(concerning expired and soon-to-expire patents) that use the Phillips
standard. These are found in the Code of Federal Regulations (at 37 CFR
part 42) and on USPTO's website, including at the following page where
USPTO has links to the relevant regulations as well as the Trial
Practice Guide that informs the public of standard practices before
PTAB during AIA trials: https://www.uspto.gov/patents-application-process/patent-trial-and-appeal-board/resources. Because these are used
now for trials under both BRI and Phillips, USPTO does not need to
revise these procedures and guidance to implement the change set forth
in this final rule, and does not need to make regulatory changes other
than those set forth in this final rule.
Moreover, PTAB has not found that parties to these AIA proceedings
under Phillips require expanded page limits or otherwise incur more
expense in their AIA trials than parties in AIA proceedings under BRI.
The USPTO's experience is that arguments under Phillips are not more
complicated or more lengthy than arguments under the BRI standard.
Rather, both standards are familiar to patent practitioners appearing
before the USPTO and district courts. Consequently USPTO expects that
these proceedings utilizing the Phillips standard will operate
procedurally in much the same way as BRI proceedings using the BRI
standard, that they will cost USPTO and parties no more to conduct, and
that they will be completed within the statutory deadline. In sum, the
direct result of USPTO changing the claim construction standard argued
in some AIA trials from one well-known standard to another well-known
(as noted, a standard already used in some AIA trials) will not have
direct economic impacts.
Given the fact that 86.8% of PTAB proceedings have been the subject
of litigation in Federal court, where parties are already using the
Phillips standard, the Office reasonably anticipates expanding the use
of the Phillips standard to all AIA trials should result in parties
realizing some efficiency in the legal work required for their PTAB
proceedings. Not only will applying the federal court claim
construction standard in AIA proceedings lead to greater consistency
with the federal courts and the ITC, where such consistency will lead
to greater certainty as to the scope of issued patent claims, but it
will also help achieve the goal of increasing judicial efficiency and
eliminate arguments relating to different standards across fora. The
Office has not increased the page limits of briefs for the AIA trials
that currently use Phillips, and the paperwork burden associated with
briefings for trials is covered by the current information collections
based on the current page limits, thus the overall cost burden on
respondents is not expected to change. It is possible that this rule
may produce a slight reduction in the indirect costs as a result of
improving efficiency by reducing wasted effort in conducting
duplicative efforts in construing claims. For example, in some cases
there may be savings in legal fees because the parties may be able to
leverage work done in the district court. Using the same claim
construction standard across the fora would increase efficiency, as
well reduce cost and burden because parties would only need to focus
their resources to develop a single set of claims construction
arguments. In summary, given the Office's experience with existing PTAB
proceedings currently conducted using the Phillips standard and the
efficiencies that may be realized by having consistency between all AIA
trials and the standard use in federal court litigation, the Office
does not expect that this rule change will impose costs on parties.
Implementation
The changes to the claim construction standard will apply to
proceedings where a petition is filed on or after the effective date of
the final rule. The Office will apply the federal court claim
construction standard, in other words, the claim construction standard
that would be used to construe the claim in a civil action under 35
U.S.C. 282(b), which is articulated in Phillips, to construe patent
claims and proposed substitute claims in AIA proceedings in which trial
has not yet been instituted before the effective date of the final
rule. The Office will continue to apply the BRI standard for construing
unexpired patent claims and proposed substitute claims in AIA
proceedings where a petition was filed before the effective date of the
final rule.
As to comments received regarding filing a prior claim construction
determination, parties should submit the prior claim construction
determination by a federal court or the ITC in an AIA proceeding as
soon as that determination becomes available. Preferably, a prior claim
construction determination should be submitted with the petition,
preliminary response, or
[[Page 51345]]
response, with explanations. See the response to comment 37 below for
more information.
Discussion of Specific Rules
Title 37 of the Code of Federal Regulations, part 42, is amended as
follows:
Sections 42.100, 42.200, and 42.300: Sections 42.100(b), 42.200(b),
and 42.300(b) are amended 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 the claim in a civil action 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. This revision replaces the BRI standard for construing
unexpired patent claims and proposed substitute claims during an IPR,
PGR, or CBM proceeding with the same claim construction standard that
is used in federal courts and ITC proceedings. As discussed above, the
Office will apply the standard used in federal courts and the ITC,
which construe patent claims in accordance with the principles that the
Federal Circuit articulated in Phillips. This rule reflects that the
PTAB in an AIA proceeding will apply the same standard applied in
federal courts to construe patent claims. The Office will construe
patent claims and proposed substitute claims based on the record of the
IPR, PGR, or CBM proceeding, taking into account the claim language
itself, specification, and prosecution history pertaining to the
patent, as well as relevant extrinsic evidence, all as in prevailing
jurisprudence of Article III courts. The Office will take into account
the prosecution history that occurred previously in proceedings at the
Office prior to the IPR, PGR, or CBM proceeding at issue, including in
another AIA proceeding, or before an examiner during examination,
reissue, and reexamination. As in a district court proceeding, the
parties should point out the specific portions of the specification,
prosecution history, and relevant extrinsic evidence they want
considered, and explain the relevancy of any such evidence to the
arguments they advance. Each party bears the burden of providing
sufficient support for any construction advanced by that party.
The Office has considered using different claim construction
standards for IPR, PGR, and CBM proceedings, but, for consistency, the
Office adopts the same claim construction to be applied in all IPR,
PGR, and CBM proceedings. By maintaining consistency among the various
proceedings, the integrity, predictability and reliability of the
patent system is thus enhanced.
Sections 42.100(b), 42.200(b), and 42.300(b) are also amended to
state that ``[a]ny prior claim construction determination concerning a
term of the claim in a civil action, or a proceeding before the [ITC],
that is timely made of record in the . . . proceeding will be
considered.'' Under this provision, the Office will consider any prior
claim construction determination in a civil action or ITC proceeding if
a federal court or the ITC has construed a term of the involved claim
previously using the same standard, and the claim construction
determination has been timely made of record in the IPR, PGR, or CBM
proceeding.
Sections 42.100(b), 42.200(b), and 42.300(b) are further amended by
deleting the second and third sentences, eliminating the procedure for
requesting a district court-type claim construction approach for a
patent expiring during an IPR, PGR, or CBM proceeding. Such a procedure
is no longer needed because the Office will use the same claim
construction standard that is used in federal courts and ITC
proceedings uniformly for interpreting all claims in an IPR, PGR, or
CBM proceeding.
Response to Comments
The Office received a total of 374 written submissions of comments
from intellectual property organizations, businesses, law firms, legal
professors and scholars, patent practitioners, and others. The comments
provided support for, opposition to, and diverse recommendations on the
proposed rules. The large majority of the comments were supportive of
changing the claim construction standard along the lines proposed in
the proposed rule. For example, major bar associations, industry
groups, patent practitioners, legal professors and scholars, and
individuals supported the change.
The Office appreciates the thoughtful comments, and has considered
and analyzed the comments thoroughly. All of the comments are posted on
the PTAB website at https://www.uspto.gov/patents-application-process/patent-trial-and-appeal-board/comments-changes-claim-construction.
The Office's responses address the comments that are directed to
the proposed changes set forth in the notice of proposed rulemaking. 83
FR 21221. Any comments directed to topics that are beyond the scope of
the notice of proposed rulemaking will not be addressed at this time.
Uniformity, Predictability, and Certainty
Comment 1: Most comments strongly supported the proposed rules that
adopt the Phillips claim construction standard for interpreting claims
in IPR, PGR, and CBM proceedings (``AIA proceedings''), harmonizing the
claim construction standard between AIA proceedings before the PTAB and
the proceedings before federal courts and the ITC. For example, most of
the comments noted that this rule change should lead to greater
consistency with the federal courts and ITC, and such consistency will
lead to greater certainty as to the scope of issued patent claims. The
comments also indicated that the rule change will promote a balanced
approach, providing greater predictability and certainty in the patent
system, which will, in turn, increase judicial efficiency and reduce
economic waste. The comments further explained that adopting the
Phillips standard will potentially provide for more accurate claim
constructions and reduce incentives for parallel-track litigation and
increase efficiency between fora.
Responses: The Office agrees with these comments. Under the amended
rules, as adopted in this final rule, the Office will construe a claim
using the same claim construction standard that would be used to
construe the claim in a civil action under 35 U.S.C. 282(b), aligning
the claim construction standard used in AIA proceedings with the
standard used in federal courts and ITC proceedings. As noted by the
commentators, the rule change will lead to greater consistency and
harmonization with the federal courts and the ITC and lead to greater
certainty and predictability in the patent system. We further agree
this will increase judicial efficiencies between PTAB and other fora.
For example, several trade associations and corporations commented that
the use of the same claim construction standard will reduce duplication
of efforts by parties and by the various tribunals. This is important
because, as one study indicated, there is significant overlap between
AIA proceedings and district court litigation. Saurabh Vishnubhakat,
Arti K. Rai & Jay P. Kesan, ``Strategic Decision Making in Dual PTAB
and District Court Proceedings,'' 31 Berkeley Rec. L.J. 45 (2016),
https://ssrn.com/abstract=2731002. As suggested by the authors of the
study, the application of the same standard of claim construction by
the PTAB, federal courts, and the ITC would increase efficiency as it
would
[[Page 51346]]
enhance the ability of federal courts and the ITC to rely upon PTAB
claim constructions in subsequent proceedings. Id. at 81.
Comment 2: Some comments opposed the proposed rule changes, arguing
that Congress intended the PTAB to use the BRI standard in AIA
proceedings, Congress has declined to change the claim construction
standard, the Office should wait until Congress changes the claim
construction standard, and the BRI standard is appropriate for the
reasons provided by the Office in the initial AIA proceeding final rule
in 2012 (77 FR at 48697-99), the 2016 final rule (81 FR at 18752), and
the government briefs in Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct.
2131 (2016) and Oil States Energy Services, LLC v. Greene's Energy
Group, LLC, 138 S. Ct. 1365 (2018). Another comment suggested that the
Office has previously taken the position in Cuozzo that the history,
congressional intent, amendments, and statutory framework of the AIA
support the BRI in AIA proceedings. A few comments requested that, if
the Office adopts the proposed changes, the Office should implement
procedures that will safeguard the AIA's goal of improving patent
quality and minimize unfairness to the parties. Some of the comments
suggested that the proposal is arbitrary and capricious, and the Office
did not provide adequate notice, explanation, or evidence and should
issue a new proposed rule.
Response: The Office appreciates the thoughtful comments. Since the
publication of the second final rule in 2016, the Director has
considered the significant experience the Office has now had with its
almost six years of AIA proceedings. The Office also now has the
benefit of several additional years of Federal Circuit decisions,
resulting in hundreds of additional decisions that were not available
during the first several years of AIA implementation. This additional
experience, and recent studies, support the numerous concerns expressed
by stakeholders with the use of BRI, and that compelling reasons exist
to apply the same standard in AIA proceedings as that used in district
court.
The Supreme Court has endorsed the Office's ability to choose an
approach to claim construction for AIA proceedings. Cuozzo, 136 S. Ct.
at 2142-46 (``That is a question that Congress left to the particular
expertise of the Patent Office.''). Congress did not expressly set
forth a claim construction standard in the statute, but rather deferred
to the Office's expertise to select the appropriate standard for
construing claims in AIA proceedings. Id. (noting that ``neither the
statutory language, its purpose, [nor] its history suggest that
Congress considered what standard the agency should apply when
reviewing a patent claim in inter partes review'').
Notably, the statutory provision set forth in 35 U.S.C. 316(a)(4)
grants the Office authority to issue ``regulations . . . establishing
and governing inter partes review under this chapter and the
relationship of such review to other proceedings under this title.''
For PGR and CBM proceedings, 35 U.S.C. 326(a)(4) contains a similar
provision. Furthermore, under 35 U.S.C. 316(a)(2) and 326(a)(2), the
Office must prescribe regulations ``setting forth the standards for the
showing of sufficient grounds to institute a review.'' In prescribing
regulations under 35 U.S.C. 316(a) and 326(a), and among other things,
the Director has considered ``the effect of any such regulation on the
economy, the integrity of the patent system, the efficient
administration of the Office, and the ability of the Office to timely
complete proceedings instituted under this chapter,'' in accordance
with 35 U.S.C. 316(b) and 326(b). In addition, the Director has
carefully considered all of the comments received. As stated in the
notice of proposed rulemaking, and with all of this information in
mind, the Office's goal is to implement a fair and balanced approach,
providing greater predictability and certainty in the patent system.
This, in turn, implements the congressional intent of the AIA. H.R.
Rep. No. 112-98, pt. I at 48 (2011), as reprinted in 2011 U.S.C.C.A.N.
67, 78; see also id. at 40 (``[The AIA] is designed to establish a more
efficient and streamlined patent system that will improve patent
quality and limit unnecessary and counterproductive litigation
costs.'').
Prior to this final rule, the PTAB already has been applying the
principles articulated in Phillips and its progeny for interpreting
claims of expired patents and soon-to-be-expired patents in AIA
proceedings. Using this standard for interpreting all other claims will
result in a uniform standard for all claims under review in AIA
proceedings before the PTAB, in federal court litigations, and at the
ITC. Significantly, as noted by some of the comments, applying the
federal court claim construction standard in AIA proceedings will lead
to greater consistency with the federal courts and the ITC, and such
consistency will lead to greater certainty as to the scope of issued
patent claims, and will help achieve the goal of increasing judicial
efficiency and eliminate arguments relating to different standards
across fora, which will lead to cost savings for all litigants. As one
commenter observed, the adoption of the federal court claim
construction standard is consistent with ``uniform interpretation of
the patent laws,'' which is a well-recognized goal of the patent system
as it allows the strength of patents to be meaningfully and positively
predicted. Hearings on H.R. 6033, H.R. 6934, H.R. 3806 and H.R. 2414,
Before the Subcomm. on Courts, Civil Liberties and the Admin. of
Justice of the House Comm. on the Judiciary, 96th Cong., 797 (1980).
The Office recognizes that in some respects AIA proceedings serve a
different purpose than that of litigation in the federal courts.
Cuozzo, 136 S. Ct. at 2143-44. For example, Congress intended AIA
proceedings to provide ``quick and cost effective alternatives'' to
litigation in the courts, as well as to ``provide a meaningful
opportunity to improve patent quality and restore confidence in the
presumption of validity that comes with issued patents in court.'' H.R.
Rep. No. 112-98, pt. I at 48 (2011), as reprinted in 2011 U.S.C.C.A.N.
67, 78; see also id. at 40 (``[The AIA] is designed to establish a more
efficient and streamlined patent system that will improve patent
quality and limit unnecessary and counterproductive litigation
costs.''). The changes in the proposed rule will better effect these
purposes, for example by reducing costs associated with duplicative
proceedings, and improving efficiency by reducing wasted effort.
As to the comment pointing to prior arguments advanced in
connection with the Cuozzo case, the Supreme Court expressly rejected
the argument that the history, congressional intent, amendments, and
statutory framework of the AIA required the use of BRI in AIA
proceedings: ``Finally, neither the statutory language, its purpose, or
its history suggest that Congress considered what standard the agency
should apply when reviewing a patent claim in inter partes review.''
Cuozzo, 136 S. Ct. at 2142-46. The Court further held that such
decisions were left to the sound discretion of the Office: ``[W]e do
not decide whether there is a better alternative as a policy matter.
That is a question that Congress left to the particular expertise of
the Patent Office.'' Id. As explained in detail in this final rule
package, the six years of experience with AIA proceedings, the many
additional parallel court cases, as well as the numerous requests from
stakeholders concerned with the use of BRI and comments received, make
clear that using the same claim construction standard as in federal
courts and the ITC better serves the public and the intent
[[Page 51347]]
of the AIA to provides, among other things, ``a more efficient and
streamlined patent system that will improve patent quality and limit
unnecessary and counterproductive litigation costs.'' AIA H.R. Rep. No.
112-98, pt. I at 48 (2011), as reprinted in 2011 U.S.C.C.A.N. 67, 78;
see also id. at 40. Indeed, many of the bases originally advanced in
2012 as justifying the use of BRI have not been borne out. See e.g.,
Greenleaf at 11 (``It is not clear, given more than five years of
experience with PTAB post-grant proceedings, that there is any
justification for using BRI for issued patents).
As to the suggestion that the rulemaking has been arbitrary and
capricious, the Office has proceeded with the implementation of AIA
proceedings deliberately and with caution, continuously engaging the
public and seeking feedback to gauge the effectiveness of the rules and
procedures that govern AIA proceedings. At each stage of the process,
including in this final rule, the Office has supported its exercise of
discretion with reasoned analysis in response to comments received. For
example, in the initial 2012 rulemaking, the Office adopted the BRI
standard for construing claims of unexpired patents based on its prior
experience, as well as adopting the principles articulated in Phillips
and its progeny for interpreting claims of expired patents. 77 FR
48680. To elicit even more input, in June of 2014, the Office published
a Request for Comments in the Federal Register and, at public request,
extended the period for receiving comments to October 16, 2014. See
Request for Comments on Trial Proceedings Under the America Invents Act
Before the Patent Trial and Appeal Board, 79 FR 36474 (June 27, 2014)
(``Request for Comments''). The Request for Comments asked seventeen
questions on ten broad topics, including a general catchall question,
to gather public feedback on any changes to AIA proceedings that might
be beneficial. See Request for Comments, 79 FR at 36476-77. This was
followed by the 2016 rulemaking, where the Office incrementally
expanded the use of the district court claim construction standard,
which is articulated in Phillips, to interpret claims of soon-to-be-
expired patents in AIA proceedings. 81 FR 18750.
As noted above, since the time of the last AIA rule package, the
Federal Circuit has issued a six-fold increase in the number of
decisions relating to AIA proceedings. And now, in light of these
decisions and based on the PTAB's experience over six years, including
applying the federal court claim construction standard in AIA
proceedings in certain contexts, the Office has determined that
employing the district court standard for interpreting all claims in
AIA proceedings will continue to enhance predictability and reliability
of the patent system.
The PTAB's use of the district court standard, for interpreting all
claims in AIA proceedings, will address concerns that have been
continually expressed by stakeholders and demonstrated in recent
studies that the use of a different claim construction standard in AIA
proceedings wastes resources and has the potential for resulting in
troubling differences in construction-outcomes between proceedings. See
Bagley at 354; Greenleaf at 9. Notably, the PTAB will continue to
provide a second look at an earlier administrative grant of a patent by
determining whether to review the claims challenged by a petitioner
based on the prior art and grounds asserted in the petition, with any
final action taking into account the evidence in the entire record of
any instituted proceeding. In addition, the PTAB will consider the
claim language itself, the specification, prosecution history
pertaining to the patent, and any prior claim construction
determinations from the federal courts and the ITC that have been
timely made of record, to provide a claim construction determination in
accordance with the amended rules as adopted in this final rule. The
PTAB will consider the issues as briefed by the parties, and may review
whatever portions of the record are required to arrive at the
``correct'' construction pursuant to Phillips and its progeny. The PTAB
also will continue to provide an initial claim construction
determination in the institution decision based on the record at the
preliminary stage, including the parties' proposed claim constructions
and supporting evidence. If a trial is instituted, the parties will
continue to have sufficient opportunities to submit additional
arguments and evidence during the trial, addressing the PTAB's initial
claim construction determination before the oral hearing. The PTAB will
continue to consider the entirety of the trial record before entering a
final written decision that sets forth any final claim construction
determination. A party dissatisfied with the final written decision,
including the final claim construction determination, will continue to
have the opportunity to file a request for rehearing without prior
authorization from the PTAB and the right to appeal the decision to the
Federal Circuit. All parties will continue to have a full and fair
opportunity to present arguments and evidence prior to any final
determination. The vast majority of commentators, including those few
opposed to the change, agree that the PTAB's current procedures are
effective in implementing the goals of the AIA, and those procedures
remain available.
As in the federal courts and ITC, the PTAB will ``seek out the
correct construction--the construction that most accurately delineates
the scope of the claim invention--under the framework laid out in
Phillips.'' PPC Broadband, 815 F.3d at 740. To promote fairness,
balance, predictability, and certainty in the patent system, the Office
is exercising its statutory authority under 35 U.S.C. 316(a)(2),
316(a)(4), 326(a)(2), and 326(a)(4) to adopt the federal court claim
construction standard, which is articulated in Phillips, for
interpreting claims in AIA proceedings, harmonizing the claim
construction standards between AIA proceedings and proceedings before
the federal courts and ITC. See, e.g., 35 U.S.C. 316(a)(4) (``The
Director shall prescribe regulations . . . establishing and governing
inter partes review of this chapter and the relationship of such review
to other proceedings under this title.''). Fundamentally, each of the
federal courts, the ITC, and the PTAB will use the same objective
standards under the Phillips framework to arrive at the claim
construction when performing their analysis. Predictability and
reliability of the patent system are thus enhanced, for example by
increasing the likelihood that a claim will be construed in the same
manner by the federal courts, the ITC, and the PTAB.
Consistency
Comment 3: Many comments stated that the rule change will promote
consistency between the various fora. The comments suggested this would
result in a more uniform and fair patent system. The comments further
asserted adoption of the Phillips standard prevents parties from taking
inconsistent positions, such as a patent challenger arguing for a broad
scope in a PTAB proceeding (under BRI) and a narrow scope (under
Phillips) in district court to avoid a finding of infringement.
Response: The Office agrees that aligning the claim construction
standard used in PTAB proceedings with that used by the federal courts
and the ITC promotes consistency in claim construction rulings and
patentability determinations. The Federal Circuit has stated that when
a party loses in a court proceeding challenging a patent, ``the
[[Page 51348]]
PTO ideally should not arrive at a different conclusion'' on the same
presentations and arguments. See In re Baxter, 678 F.3d 1357, 1365
(Fed. Cir. 2012). Adoption of the Phillips standard will reduce the
potential for inconsistent results between different fora. We further
agree that consistency leads to a more uniform, reliable, and
predictable patent system. Specifically, as discussed above, the
adoption of the federal court claim construction standard is consistent
with ``uniform interpretation of the patent laws,'' which is a well-
recognized goal of the patent system as it allows the strength of
patents to be meaningfully and positively predicted. Hearings on H.R.
6033, H.R. 6934, H.R. 3806 and H.R. 2414, Before the Subcomm. on
Courts, Civil Liberties and the Admin. of Justice of the House Comm. on
the Judiciary, 96th Cong., 797 (1980).
Comment 4: Some comments stated that the BRI standard ensures
claims will be interpreted consistently among different proceedings
before the Office, and applying different claim construction standards
for different parts of the Office will lead to inconsistency,
confusion, and complexity within the Office. A few comments also
asserted that adopting the Phillips standard will frustrate the
Office's statutory authority to consolidate different proceedings
involving the same patent. Some of the comments further suggested that
the Office may find claims patentable over prior art in an AIA
proceeding applying the Phillips standard and at the same time
unpatentable over the same prior art in a reexamination applying the
BRI standard. The comments noted that, if the PTAB does not apply the
BRI standard in AIA proceedings, the Office will be required to approve
in an AIA proceeding a patent claim that it would have rejected in an
initial examination or reexamination considering the same prior art.
Response: As the Federal Circuit recently explained, ``[i]n many
cases, the claim construction will be the same under [both the BRI and
Phillips] standards.'' In re CSB-System Int'l, Inc., 832 F.3d 1335,
1341 (Fed. Cir. 2016). ``Even under the broadest reasonable
construction rubric . . . , the board must always consider the claims
in light of the specification and teachings in the underlying patent.''
In re Power Integrations, Inc., 884 F.3d 1370, 1375 (Fed. Cir. 2018)
(citation and internal quotation marks omitted). ``And there is no
reason why this construction could not coincide with that of a court in
litigation.'' Id. Moreover, in an AIA proceeding, ``[t]he PTO should
also consult the patent's prosecution history in proceedings in which
the patent has been brought back to the agency for a second review.''
Microsoft Corp. v. Proxyconn, Inc., 789 F.3d 1292, 1298 (Fed. Cir.
2015), overruled on other grounds by Aqua Prods., Inc. v. Matal, 872
F.3d 1290 (Fed. Cir. 2017) (en banc). ``[T]he Board's construction
cannot be divorced from the specification and the record evidence'' and
``must be consistent with the one that those skilled in the art would
reach.'' Id. (citations and internal quotation marks omitted). ``A
construction that is unreasonably broad and which does not reasonably
reflect the plain language and disclosure will not pass muster.'' Id.
(citation and internal quotation marks omitted). In addition, the
recent IPO study acknowledged that ``[i]t is difficult to dissect or
predict the differences between outcomes under BRI or Phillips'' and
that ``[t]he claim construction procedure under both standards appears
to be very similar if not identical.'' Greenleaf, at 9. The IPO study
indicates that, since 1986, ``there have been very few decisions in
which courts have attributed a variance in claim interpretation to the
differences between the two standards.'' Id. at 1. In sum, consistent
with the IPO study and the Federal Circuit, we believe that the
patentability determination reached will be consistent for BRI and
Phillips in the vast majority of cases decided.
Furthermore, the Office already has been applying the principles
articulated in Phillips to claims of expired patents and soon-to-be
expired patents that were previously examined, reexamined, or reissued,
under the BRI standard. Based on the Office's years of experience,
employing the federal court claim construction standard, which is
articulated in Phillips, for interpreting all claims in AIA proceedings
will not lead to inconsistency, confusion, and complexity within the
Office. For example, the Office has been applying the Phillips standard
in ex parte reexamination, e.g. with regard to expired claims, since
its implementation in 1981.
In direct contrast to AIA proceedings, the Office is required by
statute to conduct reissue and reexamination proceedings according to
the procedures established for initial examination. 35 U.S.C. 251(c)
and 305. Under 35 U.S.C. 315(d) and 325(d), during the pendency of an
AIA proceeding, ``if another proceeding or matter involving the patent
is before the Office, the Director may determine the manner in which
the [AIA proceeding] or other proceeding or matter may proceed,
including providing for stay, transfer, consolidation, or termination
of any such matter or proceeding.'' The Office has exercised its
discretion under these statutory provisions to stay and/or terminate
reexaminations and reissue proceedings. The Office has not, to date,
merged or consolidated a reexamination or reissue proceeding with an
AIA proceeding. Prior to making a determination to consolidate
proceedings, the Office will consider whether the claim construction
standard would have any material effect on the claim construction
determinations in the specific proceedings at issue, for example by
considering whether a term at issue in any of the proceedings has a
different construction under the different claim construction
standards. Additionally, as to comments that the Office will arrive at
different claim constructions in AIA proceedings and reexaminations,
the Office has existing tools to address these situations, including,
e.g., the use of discretion under 35 U.S.C. 325(d).
As stated in the notice of proposed rulemaking, one study found
that 86.8% of patents at issue in AIA proceedings also have been the
subject of litigation in the federal courts. Saurabh Vishnubhakat, Arti
K. Rai & Jay P. Kesan, Strategic Decision Making in Dual PTAB and
District Court Proceedings, 31 Berkeley Tech. L.J. 45 (2016), http://ssrn.com/abstract=2731002. Based on these data, feedback the Office has
received from the public, recent case law regarding claim construction
standards, and the submitted comments, it is appropriate to harmonize
the claim construction standard used in AIA proceedings with the
standard used in the federal courts and ITC proceedings.
In addition, unlike initial examination of pre-issued claims in a
patent application, patent owners in AIA proceedings have not filed as
many motions to amend as previously anticipated (through June 30, 2018,
the Office has decided only 196 motions to amend, granting 4%,
granting-in-part 6%, and denying 90%). As noted in a comment received
from a trade association, patent owners are reluctant to substantially
amend claims that have been asserted in a co-pending infringement
litigation. This comment stated that ``this is generally believed to be
due to intervening rights [e.g., under 35 U.S.C. 318(c), 328(c), and
252] and the loss of past damages [for infringement in a co-pending
litigation] after amendment, not to any inability to amend.'' See,
e.g., McKeown, Amendment Efforts at PTAB Trend Downward, LexisNexis
Newsroom (Dec. 2014), available at https://
[[Page 51349]]
www.lexisnexis.com/legalnewsroom/intellectual-property/b/patent-
lawblog/archive/2014/12/16/amendment-efforts-at-ptab-trend-
downward.aspx (noting that ``historically, patentees would rarely amend
claims at the USPTO that were asserted in a co-pending litigation'' due
to intervening rights and tying the lack of use of amendments in IPR to
those intervening rights). Claim amendments in AIA proceedings have
therefore been relatively rare and substantially different than
amendments during examination. Accordingly, one of the original bases
suggested for the use of BRI has not been borne out, and the Office no
longer believes that the opportunity to amend in an AIA proceeding
justifies the use of BRI.
On balance, after years of experience and in view of the comments
received, the Office has determined that using a claim construction
standard for issued patents subject to AIA proceedings that is
consistent with the standard applied in federal courts and the ITC is
better for advancing the economy, the integrity of the patent system,
the efficient administration of the Office, and the ability of the
Office to complete timely the proceedings.
Comment 5: Some comments asserted that harmonizing the claim
construction standards between AIA proceedings and the proceedings
before the federal courts and the ITC would not necessarily result in
the same claim constructions. They pointed out that federal courts
applying the Phillips standard can reach different constructions for a
particular claim (as in the situation where the Federal Circuit
disagrees with the construction provided by a district court); many
courts may not wholly accept the PTAB's constructions; and the
evidentiary standard in AIA proceedings is different from the standard
used in the federal courts and the ITC.
Response: The PTAB is required by statute to employ a different
evidentiary standard for determining the patentability of a challenged
claim than that used in federal courts and the ITC. However, there is
no statute applicable to either the PTAB or federal courts that
requires any different standards, evidentiary or otherwise, for claim
construction. Moreover, as to harmonizing claim construction standards,
the Federal Circuit recently explained that the prosecution disclaimer
doctrine includes patent owner's statements made in an AIA proceeding,
to ensure that ``claims are not argued one way in order to maintain
their patentability and in a different way against accused
infringers.'' Aylus Networks, Inc. v. Apple Inc., 856 F.3d 1353, 1360-
61 (Fed. Cir. 2017) (citing Southwall Techs., Inc. v. Cardinal IG Co.,
54 F.3d 1570, 1576 (Fed. Cir. 1995)). As the Federal Circuit
acknowledged, consistency between fora is important.
Under the amended rules, as adopted by this final rule, the PTAB
will apply the same claim construction standard as used in federal
courts and the ITC, ``seek[ing] out the correct construction--the
construction that most accurately delineates the scope of the claim
invention--under the framework laid out in Phillips.'' PPC Broadband,
815 F.3d at 740. The PTAB also will consider any prior claim
construction determinations from the PTAB, the federal courts, and the
ITC that are timely made of record to promote consistency. Therefore,
the amended rules will encourage parties to take a consistent position
with respect to claim constructions in their patentability and
infringement arguments, to ensure that whatever decision issues,
regardless of forum, is reflective of the ``correct'' construction.
As to comments that courts may not wholly accept the PTAB's
constructions, this is an issue that federal courts will decide in the
particular cases that come before them, based on the record available
at that time. Having the same claim construction standard, however,
increases the likelihood that courts may consider the PTAB's
construction for a given patent.
Clarity and Public Notice
Comment 6: Several comments were in favor of the Phillips standard
for interpreting claims in AIA procedures because it would promote
clarity and eliminate the current disparity in how claims are
construed. The comments asserted that the current differences in claim
construction standards undermine the public notice function and subject
patent owner's property rights to unnecessary and undesirable risks,
which discourages investment in innovative ideas and hurts inventors
and innovation.
Response: We agree that adoption of the Phillips claim construction
standard will promote clarity and public notice. By using the same
claim construction standard in PTAB proceedings that is used by the
federal courts and the ITC, greater certainty on the scope of issued
patent claims will be provided to all stakeholders. In particular, we
agree with the comments received that reducing the potential for
inconsistent results between the PTAB and federal courts would
encourage inventors to use the patent system. For example, one trade
association commented that a uniform standard would lead to greater
certainty and investment, while another trade association stated that
the adoption of the federal court claim construct standard promoted
certainty, which is a recognized goal of the AIA. Senate Debate, 157
Cong. Rec. S5347, S5354 (daily ed. Sept. 7, 2011) (Statement of
Administration Policy on H.R. 1249) (discussing how the AIA created new
trial proceedings ``to increase the quality and certainty of patent
rights and offer cost-effective, timely alternatives to district court
litigation'').
Comment 7: A few comments asserted that the BRI standard promotes
clarity and public notice by incentivizing a patentee to amend its
claims so that the boundary between its patent rights and the prior art
can be more clearly delineated. A few comments also expressed concerns
that, if the PTAB applies the Phillips standard in AIA proceedings, the
district court may construe a claim more broadly than the PTAB's claim
construction, resulting in a situation where subject matter that is in
the prior art nonetheless may infringe the patent.
Response: The PTAB's construction of a claim under the framework
set forth in Phillips will promote clarity and public notice. Moreover,
since both a district court and the PTAB will use the same standard to
construe the claim, there will be reduced likelihood of differences
between the scope of claim construction at either forum. The Federal
Circuit recently affirmed a district court's claim construction by
holding that the statements made by a patent owner during an AIA
proceeding, even before institution, are part of the prosecution
history and can be relied on to support a finding of prosecution
disclaimer. Aylus Networks, 856 F.3d at 1361. The court explained that
``[e]xtending the prosecution disclaimer doctrine to IPR proceedings
will ensure that claims are not argued one way in order to maintain
their patentability and in a different way against accused
infringers.'' Id. at 1360. ``In keeping with the underlying purposes of
the doctrine, this extension will `promote[ ] the public notice
function of the intrinsic evidence and protect[ ] the public's reliance
on definitive statements made during''' AIA proceedings. Id. (quoting
Omega Eng'g, Inc. v. Rayteck Corp., 334 F.3d 1314, 1324 (Fed. Cir.
2003)). Accordingly, applying the same standard will alleviate the
commentators' concerns with regard to differences in claim scope
between the district court and PTAB.
In addition, under the amended rules, as adopted by this final
rule, the PTAB
[[Page 51350]]
will consider any prior claim construction determinations from federal
courts and the ITC that are timely made of record to enhance
consistency. Moreover, as noted above, unlike initial examination, the
vast majority of AIA proceedings involve patents in litigations, and as
noted above, patent owners are reluctant to substantially amend their
claims that are involved in an infringement litigation for a variety of
reasons, such as to avoid triggering intervening rights. Therefore, one
of the originally suggested bases for using BRI in 2012 has not been
borne out. Claim amendments in AIA proceedings are relatively rare and
substantially different than amendments during examination, and the
Office no longer believes that the opportunity to amend in an AIA
proceeding justifies the use of BRI.
Fairness
Comment 8: Many comments opined that harmonizing the claim
construction standard used in AIA proceedings with that used in the
federal courts and ITC proceedings will ensure greater fairness and
predictability to the patent system, which will in turn maximize
judicial efficiency and minimize economic waste. Several comments
acknowledged that harmonizing the claim construction standards would
prevent parties from taking inconsistent positions and will properly
balance the interests of both patent owners and petitioners. Some of
the comments further noted that applying different standards in
different fora unfairly advantages the patent challenger because an
accused infringer may seek a broad construction for purposes of finding
claims unpatentable in an AIA proceeding before the PTAB and a narrow
construction for purposes of arguing non-infringement in a federal
court action.
Response: The Office agrees with these comments. This final rule
adopts the federal court claim construction standard, which is
articulated in Phillips, for AIA proceedings, aligning the claim
construction standard used in AIA proceedings with the standard used in
the federal courts and ITC proceedings. This will promote a more fair
and balanced system because parties will no longer be able to argue for
a broader claim scope in PTAB proceedings than that used by federal
courts. Several commenters stated that the BRI standard allows parties
to take inconsistent positions between PTAB proceedings for
patentability and litigation for infringement. One commenter stated
``[c]urrently, the absence of a uniform claim construction standard
permits patent infringers to aggressively argue inconsistent positions
on claim scope in different forums with impunity--a broad scope before
the PTAB, and a narrow scope in district court. With a uniform
application of the Phillips standard, patent challengers will have less
flexibility to advance inconsistent arguments about claim scope, and
will instead be required to choose a single claim construction that
best captures the true meaning of the patent claim, because they will
not be able to justify different constructions as being the mere result
of different claim construction standards.'' The lack of a uniform
standard between the PTAB and federal courts runs contrary to the
general principle articulated in Source Search Techs LLC v. Lending
Tree, LLC, that ``it is axiomatic that claims are construed the same
way for both validity and infringement.'' 588 F.3d 1063, 1075 (Fed.
Cir. 2009).
Comment 9: Some comments opposed the proposed rules, asserting that
using the Phillips standard in AIA proceedings would not alleviate
perceived unfairness. A few comments suggested that the Phillips
standard is susceptible to various reasonable interpretations, which
can produce multiple possible constructions, and that there is no
certainty that the decision of the PTAB and the courts will be
harmonized. Some of the comments also indicated that applying the BRI
standard in AIA proceedings is not unfair to patentees because they
have the opportunity to amend the claims to obtain more precise claim
coverage, and the BRI standard ``serves the public interest by reducing
the possibility that claims, finally allowed, will be given broader
scope than is justified,'' citing In re American Academy of Science
Tech Center, 367 F.3d 1359, 1362-63 (Fed. Cir. 2004) (citation and
internal quotation marks omitted). These comments asserted that
replacing the BRI standard would undermine this goal, resulting in less
predictability and inviting gamesmanship from patentees.
Response: As noted above, unlike initial examination, the vast
majority of AIA proceedings involve patents in litigation, and,
according to several comments, patent owners are reluctant to
substantially amend their claims that are involved in an infringement
litigation for a number of reasons, such as in order to avoid
triggering intervening rights. As stated in the notice of proposed
rulemaking, having AIA proceedings use the same claim construction
standard that is applied in federal courts and ITC proceedings also
addresses the concern that potential unfairness could result from using
an arguably broader standard in AIA proceedings. According to some
patent owners, the same claim construction standard should apply to
both the validity (or patentability) determination and the infringement
determination. Because the BRI standard potentially reads on a broader
universe of prior art than does the Phillips standard, a patent claim
could potentially be found unpatentable in an AIA proceeding (under the
BRI standard) on account of claim scope that the patent owner would not
be able to assert in an infringement proceeding (under the Phillips
standard). For example, even if a competitor's product would not be
found to infringe a patent claim (under the Phillips standard) if it
was sold after the patent's effective filing date, the same product
nevertheless could potentially constitute invalidating prior art (under
the BRI standard) if publicly sold before the patent's effective filing
date.
Based on its 6 years of experience with AIA proceedings, the Office
has determined that the same claim construction standard should apply
to both a patentability determination at the PTAB and determinations in
federal court on issues related to infringement or invalidity. Under
the amended rules as adopted by this final rule, the PTAB also will
consider any prior claim construction determination concerning a term
of the claim in a civil action or a proceeding before the ITC that is
timely made of record in an AIA proceeding. This will increase the
likelihood that claims are not argued one way in order to maintain
their patentability (or to show that the claims are unpatentable) and
in a different way against an opposing party in an infringement case,
consistent with recent case law from the Federal Circuit. See Aylus
Networks, 856 F.3d at 1360. Rather, regardless of forum, the same
objective standards will be used for claim construction.
Additionally, as discussed above, one of the originally suggested
bases for using the BRI in 2012 has not been borne out. Claim
amendments in AIA proceedings are relatively rare and substantially
different than amendments during examination, and the Office no longer
believes that the opportunity to amend in an AIA proceeding justifies
the use of the BRI.
Efficiency, Cost, Timing, and Procedural Issues
Comment 10: Most comments supported harmonizing of the claim
construction standard used in AIA
[[Page 51351]]
proceedings with the standard used in the proceedings before federal
courts and the ITC because different claim construction standards used
in various fora encourage forum shopping and parallel duplicative
proceedings. According to the comments, using the same claim
construction standard across the fora would increase efficiency as well
as certainty, and it would reduce cost and burden because parties would
only need to focus their resources to develop a single set of claim
construction arguments.
Response: The Office agrees with these comments. The existence of
different approaches to claim construction determinations may encourage
a losing party to attempt for a second bite at the apple, resulting in
a waste of the parties' and judicial resources alike. See Niky R.
Bagley, Treatment of PTAB Claim Construction Decisions: Aspiring to
Consistency and Predictability, 32 Berkeley Tech. L.J. 315, 354 (2018).
Adoption of the Phillips standard will increase efficiencies and will
reduce costs to parties because it eliminates the incentive to forum
shop based upon claim construction standards and eliminates the need to
present multiple claim construction arguments under different
standards. As discussed above, several trade associations and
corporations commented that the use of the same claim construction
standard will reduce duplication of efforts by parties and by the
various tribunals. As one commenter further stated, ``[w]ith the PTAB
and district courts applying the same claim construction standard,
there will be a stronger basis for judges in one forum to rely on claim
constructions rulings from the other, avoiding unnecessary duplication
of work.''
Comment 11: One comment seeks clarification of whether the PTAB
would review evidence of infringing products to construe claims.
According to the comment, claims cannot be construed under the Phillips
standard without at least some reference to the product accused of
infringement, citing Wilson Sporting Goods Co. v. Hillerich & Bradsby
Co., 442 F.3d 1322, 1324 (Fed. Cir. 2006), for support.
Response: To the extent that the comment suggests that Wilson
requires consideration of infringement issues during claim
construction, such a reading would overstate that case. In Wilson, the
Federal Circuit ``repeats its rule that claims may not be construed
with reference to the accused device.'' Wilson, 442 F.3d at 1330-31. It
further explained that ``that rule posits that a court may not use the
accused product or process as a form of extrinsic evidence to supply
limitations for patent claim language. Thus, the rule forbids a court
from tailoring a claim construction to fit the dimensions of the
accused product or process and to reach a preconceived judgment of
infringement or noninfringement. In other words, it forbids biasing the
claim construction process to exclude or include specific features of
the accused product or process.'' Id. In Wilson, the court merely
stated that, in certain situations, ``[t]he rule, however, does not
forbid awareness of the accused product or process to supply the
parameters and scope of the infringement analysis'' and ``a trial court
may refer to the accused product or process for that context during the
process.'' Id. (emphasis added). As such, Wilson, merely stands for the
proposition that it is permissible to consider an accused product in
the context of claim construction for purposes of infringement, not
that an accused product must be considered in all claim construction
disputes.
The Federal Circuit's decision in Wilson specifically addresses the
district court's claim construction in the context of an infringement
case. But under 35 U.S.C. 318 and 328, in an instituted AIA proceeding,
the PTAB is required to ``issue a final written decision with respect
to the patentability of any patent claim challenged by the
petitioner.'' As required by statute, the PTAB will continue to
construe claims in the context of patentability (e.g., the asserted
prior art), not infringement. Because infringement issues are generally
not before the PTAB in a patentability determination, the PTAB does
not, in most circumstances, expect this case to have applicability in
IPR proceedings. However, if a party believes that the claims of a
particular patent cannot be construed absent consideration of
additional evidence not called for in the Board's rules or practices,
that party should contact the panel of judges overseeing the proceeding
and request a conference call to discuss the facts of that specific
issue.
Comment 12: Several comments suggested using the same claim
construction procedures as used in the federal court. A few comments
expressed concerns that fully adopting the same claim construction
standard used by federal courts and the ITC could make it difficult for
the Office to comply with the statutory deadline because the claim
construction procedure at the federal courts and the ITC often involves
considerable briefing, expert testimony, technology tutorials, and
Markman hearings, which are expensive and time consuming.
Response: The Office has been applying the principles articulated
in Phillips and its progeny in AIA proceedings for interpreting claims
of expired patents, since the effective date of the AIA in 2012, and
for interpreting claims of soon-to-be expired patents, since 2016. Even
in those proceedings, the Office has met all of its statutory
deadlines, utilizing the same efficient and cost effective procedures
used in other AIA proceedings that applied the BRI standard. The Office
will continue to employ a trial procedure in all AIA proceedings that
provides ``quick and cost effective alternatives'' to litigation in the
courts, as Congress intended. Thus, as discussed above, USPTO expects
that these proceedings utilizing the Phillips standard will operate
procedurally in much the same way as proceedings utilizing the BRI
standard, that they will cost USPTO and parties no more to conduct, and
that they will be completed within the statutory deadline.
Comment 13: Some comments expressed concerns that additional
briefing and hearings related to claim construction would raise costs.
One comment suggested that the PTAB should continue to provide non-
final claim construction in the institution decisions. A few comments
suggested allowing the parties a full and fair opportunity to present
arguments and evidence prior to any final determination.
Response: As discussed above, USPTO expects--based on its prior
experience in using the Phillips standard for expired and soon-to-
expire claims--that these proceedings using the Phillips standard will
operate procedurally in much the same way as proceedings using the BRI
standard, that they will cost USPTO and parties no more to conduct, and
that they will be completed within the statutory deadline. The Office
will continue to use the trial procedure set forth in its Office Patent
Trial Practice Guide, along with any updates and amendments that USPTO
may decide to make in the future. As discussed above, USPTO does not
need to revise these procedures and guidance to implement the change
set forth in the final rule, and does not need to make regulatory
changes other than those set forth in the final rule. Both the
petitioner and patent owner will continue to have sufficient
opportunities, during the preliminary stage, to submit their proposed
claim constructions (in a petition and preliminary response,
respectively) and
[[Page 51352]]
any supporting evidence, including both intrinsic and extrinsic
evidence. Upon consideration of the parties' proposed claim
constructions and supporting evidence, the PTAB will continue to
provide an initial claim construction determination in the institution
decision, to the extent that such construction is required to resolve
the disputes raised by the parties. If a trial is instituted, the
parties also will continue to have opportunities to cross-examine any
opposing declarants, and to submit additional arguments and evidence,
addressing the PTAB's initial claim construction determination and the
opposing party's arguments and evidence before oral hearing. The PTAB
also will continue to consider the entirety of the trial record,
including the claim language itself, the specification, prosecution
history pertaining to the patent, extrinsic evidence as necessary, and
any prior claim construction determinations from the federal courts and
the ITC that have timely been made of record, before entering a final
written decision that sets forth the final claim construction
determination. All parties will continue to have a full and fair
opportunity to present arguments and evidence prior to any final
determination. The vast majority of commentators, including many of
those opposed to the change, agree that the Board's current procedures
are effective in implementing the goals of the AIA. Those procedures
remain available, will continue to apply when this final rule goes into
effect, and will be improved in the future as necessary.
Proposed Substitute Claims
Comment 14: Most of the comments supported applying the federal
court claim construction standard, which is articulated in Phillips,
uniformly to both original patent claims and substitute claims proposed
in a motion to amend. The comments suggested that using the federal
court claim construction standard should lead to greater consistency
with the federal courts and the ITC, and such consistency will lead to
greater certainty as to the scope of issued patent claims. The comments
also indicated that using the federal court claim construction standard
is appropriate because amendments proposed in AIA proceedings are
required to be narrowing, are limited to a reasonable number of
substitute claims, and are required to address patentability challenges
asserted against the original patent claims. The comments further noted
that using the same claim construction standard for interpreting both
the original and amended claims avoids the potential of added
complexity and inconsistencies between PTAB and federal court
proceedings, and this allows the patent owner to understand the scope
of the claims and more effectively file motions to amend. One of the
comments stated that the BRI standard is appropriate in the context of
the initial ex parte examination, but not appropriate for AIA
proceedings, which are inter partes post-grant proceedings, potentially
standing in for district court validity determinations, and allowing
only amendments that narrow the scope of the original patent claim.
Response: The Office agrees with these comments. Under the amended
rules, as adopted in this final rule, 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 the claim in
a civil action.'' We agree that adoption of the Phillips standard is
appropriate because, among other things, the claim amendments are
limited to a reasonable number and are required to be narrowing.
Further, the final rule will reduce the potential for inconsistency in
claim construction between PTAB proceedings and the proceedings in
federal court and the ITC, which we agree will result in greater
certainty of the scope of issued patent claims.
Comment 15: Some comments opposed applying the federal court claim
construction standard to substitute claims proposed in a motion to
amend because it would create the risk that a district court would
construe a claim broadly beyond the claim scope allowed by the Office.
According to these comments, it is inappropriate and inconsistent for
the Office to employ a different standard when new claims are presented
to the PTAB on appeal from an examiner compared to when the same new
claims are presented to the PTAB in an AIA proceeding. Some of the
comments suggested eliminating amendments or applying the BRI standard
in a proceeding in which the patent owner files a motion to amend to
protect the public from vague and overly broad amendments. One comment
indicated that, if the PTAB applies the federal court claim
construction standard in an AIA proceeding, the PTAB should require
patent owner to amend its claim to reflect that claim construction.
Response: As noted in the notice of proposed rulemaking, unlike
initial examination of new or amended claims in a patent application,
the patent owner may file a motion to amend an unexpired patent during
an AIA proceeding to propose a reasonable number of substitute claims,
but the proposed substitute claims ``may not enlarge the scope of the
claims of the patent or introduce new matter.'' 35 U.S.C. 316(d) and
326(d); 37 CFR 42.121(a)(2), 42.221(a)(2). The Federal Circuit recently
noted that ``[t]he patent owner proposes an amendment that it believes
is sufficiently narrower than the challenged claim to overcome the
grounds of unpatentability upon which the IPR was instituted.'' Aqua
Prods., 872 F.3d at 1306 (emphasis in the original). By requiring a
narrower claim, a district court applying the same objective claim
construction standards under the Phillips framework should not construe
a substitute claim beyond the scope allowed by the Office. Further, as
to any concern with vague or overly broad amendments, the PTAB is
required to issue final written decisions with respect to the
patentability of any new claim added, thus ensuring that vagueness and
overbreadth issues will be resolved by the Office before issuance.
Further, as to the suggestion that the Office require patent owners
to amend claims to reflect a federal court claim construction, such a
suggestion is not adopted for a variety of reasons. Among other things,
the PTAB will construe claims under the final rule using the same
objective standards under the Phillips framework as used by the federal
courts. Additionally the final rule specifies that ``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 covered business method patent review
proceeding will be considered.''
Construing Claims To Preserve Validity
Comment 16: Some comments opposed using a standard that applies the
doctrine of construing claims to preserve their validity.
Response: In this final rule, the Office fully adopts the federal
courts claim construction standard, which is articulated in Phillips,
for interpreting claims in AIA proceedings. This rule reflects that the
PTAB in an AIA proceeding will apply the same standard applied in
federal courts to construe patent claims.
To the extent that federal courts and the ITC still apply the
doctrine of construing claims to preserve their validity as described
in Phillips, the Office will apply this doctrine for purposes of claim
construction if dictated by the principles of Phillips and its progeny,
e.g., if those same rare circumstances arise in AIA proceedings.
[[Page 51353]]
As the Federal Circuit recognized in Phillips, this doctrine is ``of
limited utility.'' Phillips, 415 F.3d at 1327-28. The Court has not
applied that doctrine broadly, and has ``certainly not endorsed a
regime in which validity analysis is a regular component of claim
construction.'' Id. at 1327 (citation omitted). The doctrine of
construing claims to preserve their validity has been limited to cases
in which ``the court concludes, after applying all the available tools
of claim construction, that the claim is still ambiguous.'' Id.
Moreover, the Federal Circuit ``repeatedly and consistently has
recognized that courts may not redraft claims, whether to make them
operable or to sustain their validity.'' Rembrandt Data Techs., LP v.
AOL, LLC, 641 F.3d 1331, 1339 (Fed. Cir. 2011); see also MBO Labs.,
Inc. v. Becton, Dickinson & Co., 474 F.3d 1323, 1332 (Fed. Cir. 2007)
(noting that ``validity construction should be used as a last resort,
not first principle'').
Even in those extremely rare cases in which the courts applied the
doctrine, the courts ``looked to whether it is reasonable to infer that
the PTO would not have issued an invalid patent, and that the ambiguity
in the claim language should therefore be resolved in a manner that
would preserve the patent's validity,'' noting that this was ``the
rationale that gave rise to the maxim in the first place.'' Phillips,
415 F.3d at 1327 (citing Klein v. Russell, 86 U.S. (19 Wall.) 433, 466,
22 Led. 116 (1873)). ``The applicability of the doctrine in a
particular case therefore depends on the strength of the inference that
the PTO would have recognized that one claim interpretation would
render the claim invalid, and that the PTO would not have issued the
patent assuming that to be the proper construction of the term.'' Id.
at 1328.
Moreover, it also may not be necessary to determine the exact outer
boundary of claim scope because only those terms that are in
controversy need be construed, and only to the extent necessary to
resolve the controversy (e.g., whether the claim reads on a prior art
reference). See Nidec Motor Corp. v. Zhongshan Broad Ocean Motor Co.
Ltd., 868 F.3d 1013, 1017 (Fed. Cir. 2017) (noting that ``we need only
construe terms `that are in controversy, and only to the extent
necessary to resolve the controversy''') (citing Vivid Techs., Inc. v.
Am. Sci. & Eng'g, Inc., 200 F.3d 795, 803 (Fed. Cir. 1999)). Moreover,
the Federal Circuit ``repeatedly and consistently has recognized that
courts may not redraft claims, whether to make them operable or to
sustain their validity.'' Rembrandt Data, 641 F.3d at 1339.
The Rule Language
Comment 17: Some comments, although generally agreeing with the
proposed rule change, suggested some changes to the language of the
proposed rules. In particular, some of the comments suggested modifying
the rule language to summarize all of the claim construction principles
set forth in Phillips and to include other non-substantive minor edits.
Some of the comments suggested deleting the ``including'' phrase:
``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.''
Although one comment acknowledged that this ``including'' phrase is
merely exemplary, other comments suggested the deletion to ensure that
there is no difference between the claim construction standard applied
in AIA proceedings and the standard used in federal courts and ITC
proceedings, and that the deletion also would preserve the ability to
respond to future refinements in the law.
Response: As to deleting the ``including'' phrase, the
``including'' phrase is merely exemplary, not excluding additional
canons of claim construction, and not intending to reflect any
difference between standard articulated by Phillips and its progeny, as
applied by the courts. This rule reflects that the PTAB in an AIA
proceeding will apply the same standard applied in federal courts to
construe patent claims. While the comments seeking the deletion of the
``including'' phrase were not adopted, the intent of the final rule
language is to ensure that the public understands that the rule does
not differ in any way from the standard used in federal courts. The
Office has also considered modifying the rule language to summarizing
the construction principles of Phillips as well as several non-
substantive edits, but determined that the language of the rule
provides sufficient clarity. Moreover, the intent of the rule is to
ensure that the PTAB follows the same claim construction standard
applied by federal courts, including any future refinements in the
caselaw.
Comment 18: A few comments suggested changing ``such claim in a
civil action to invalidate a patent'' to ``the claim in a civil
action'' because a civil action may involve infringement of a patent,
and is not necessarily limited to invalidity actions.
Response: This suggestion is adopted. Amended Sec. Sec. 42.100(b),
42.200(b), and 42.300(b), as adopted in this final rule, provide ``a
claim . . . shall be construed using the same claim construction
standard that would be used to construe the claim in a civil action
under 35 U.S.C. 282(b) . . . .'' Again, the intent of the final rule is
to make clear that there is no difference between the claim
construction standard applied by the PTAB and the standard applied by
the federal courts to construe patent claims.
Comment 19: A few comments suggested adding ``or the Board'' in the
last sentence of the proposed rules to make explicit that prior PTAB
claim construction determinations concerning a claim term will be
considered.
Response: Applying the federal court claim construction standard,
which is articulated in Phillips, the PTAB will construe a claim based
on the record of an AIA proceeding, taking into account the claim
language itself, specification, and prosecution history pertaining to
the patent. The prosecution history taken into account includes prior
PTAB claim construction determinations concerning a term of the claim.
To ensure due consideration by the PTAB, the parties should timely
submit the relevant portions of the prosecution history that support
their arguments along with detailed explanations. The suggested change
is not adopted as it is unnecessary; prior PTAB claim construction
determinations concerning a claim term will be considered under
Phillips, for example when they are part of the intrinsic record of the
challenged patent
Comment 20: One comment suggested removing the reference to 35
U.S.C. 282(b), which does not itself provide for a civil action.
Response: The reference to 35 U.S.C. 282(b) makes clear that the
Office is adopting the same claim construction standard used in civil
actions ``involving the validity or infringement of a patent.'' 35
U.S.C. 282(b). This rule reflects that the PTAB in an AIA proceeding
will apply the same standard applied in federal courts to construe
patent claims.
Materials to be Considered
Comment 21: One comment requested clarification on what aspects of
the prosecution history would be considered in a claim construction
under the new rule.
Response: The Office may take into account the prosecution history
that occurred previously in proceedings at the Office prior to the
proceeding at
[[Page 51354]]
issue, including in another AIA proceeding, or before an examiner
during examination, reissue, and reexamination. The file history
typically consists of the patent application as originally filed, the
cited prior art, all papers prepared by the examiner during the course
of examination, and documents submitted by the applicant in response to
the various requirements, objections, and rejections made by examiner.
In addition, the file history may contain a written record of oral
communications addressing patentability issues between the examiner and
applicant. The Office will determine the claim construction based on
the record of the proceeding at issue. The parties should timely submit
the relevant portions of the prosecution history with detailed
explanations as to how the prosecution history support their arguments,
to ensure that such material is considered. Each party bears the burden
of providing sufficient support for any construction advanced by that
party.
Comment 22: Some comments suggested that consideration of prior
claim construction determination should also include prior
determinations by the Office in a prior PTAB proceeding.
Response: Reference to ``prosecution history'' in the rule includes
consideration of relevant determinations on claim construction in prior
PTAB proceedings, including determinations made in ex parte appeals and
AIA proceedings. The prosecution history includes a written record of
all communications addressing patentability issues between the PTAB,
the petitioner and the patent owner, including all briefing, motions,
evidence and decisions set forth in the record of the proceeding.
Comment 23: One comment requested clarification as to whether
federal court claim constructions and ITC claim constructions will be
considered under the new rules.
Response: Yes, each of amended Sec. Sec. 42.100, 42.200, and
42.300, as adopted in this final rule, states that ``[a]ny prior claim
construction determination concerning a term of the claim in a civil
action, or a proceeding before the [ITC], that is timely made of record
in the [inter partes, post grant or covered business method patent]
review proceeding will be considered.'' The PTAB will consider prior
claim constructions from district courts or the ITC and give them
appropriate weight. Non-exclusive factors to be considered may include,
for example, how thoroughly reasoned the prior decision is and the
similarities between the record in the district court or the ITC and
the record before the PTAB. It may also be relevant whether the prior
claim construction is final or interlocutory. These factors will
continue to be relevant under the district court claim construction
standard, which is articulated in Phillips. The PTAB may also continue
to consider whether the terms construed by the district court or the
ITC are necessary to decide the issues before it. This is not an
exclusive list of considerations, and the facts and circumstances of
each case will be analyzed as appropriate.
Comment 24: One comment suggested that the PTAB also consider
statements made by a patent owner in a prior proceeding in which the
patent owner took a position on the scope of any claims of the
challenged patent.
Response: Under the amended rules as adopted in this final rule,
the PTAB will consider statements regarding claim construction made by
patent owners filed in other proceedings in claim construction
determinations if the statements are timely made of record. Cf. Aylus
Networks, 856 F.3d at 1360-61 (extending the prosecution disclaimer
doctrine to include patent owner's statements made in a preliminary
response that was submitted a prior AIA proceeding). The Board may also
consider statements regarding claim construction made by petitioners in
other proceedings. To the extent that a party wants such information
considered by the Office, that party should point out specifically the
statements and explain how those statements support or contradict a
party's proposed claim construction in the proceeding at issue. Each
party bears the burden of providing sufficient support for any
construction advanced by that party. Furthermore the Office may take
into consideration statements made by a patent owner about claim scope,
such as those submitted under 35 U.S.C. 301(a), for example.
Comment 25: Comments requested clarification on the use of
extrinsic evidence, such as technical dictionaries or other scientific
background evidence, to demonstrate how a person of ordinary skill in
the art would interpret a particular term.
Response: Consistent with Phillips and its progeny, the use of
extrinsic evidence, such as expert testimony and dictionaries, will
continue to be useful in demonstrating what a person of ordinary skill
in the art would understand claim terms to mean. Phillips, 415 F.3d at
1318-19. The Federal Circuit has recognized that ``extrinsic evidence
in general is viewed as less reliable than intrinsic evidence.'' Id.;
Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 841 (2015)
(noting the use of extrinsic evidence when ``subsidiary facts are in
dispute''). Moreover, when the specification is clear about the scope
and content of a claim term, there may be no need to turn to extrinsic
evidence for claim interpretation. See 3M Innovative Props. Co. v.
Tredegar Corp., 725 F.3d 1315, 1326-28 (Fed. Cir. 2013). This rule
reflects that the PTAB in an AIA proceeding will apply the same
standard applied in federal courts to construe patent claims.
Comment 26: One comment sought clarification on the types of civil
actions for which claim interpretations would be considered, noting
that reference to 35 U.S.C. 282(b) appears to limit the scope of civil
actions to only those civil actions that arise seeking declaratory
judgment of invalidity, and not to consideration of claim constructions
of a patent in an infringement action filed under 35 U.S.C. 271,
despite the fact that claim construction standards are identical in
both types of proceedings.
Response: Reference to ``a civil action under 35 U.S.C. 282(b)''
refers to the standard that will be used in interpreting claims in IPR,
PGR, or CBM proceedings, and encompasses both invalidity and
infringement as it relates to a defense ``in any action involving the
validity or infringement of a patent.'' The PTAB will consider claim
constructions in any civil action or ITC proceeding in which the
meaning of the same term of the same patent has been previously
construed. This rule reflects that the PTAB in an AIA proceeding will
apply the same standard applied in federal courts to construe patent
claims.
Comment 27: One comment sought clarification as to the role of the
ordinary meaning of the claim term.
Response: The Office will construe claim terms consistent with the
standard used in a civil action under 35 U.S.C. 282(b), which includes
construing the claim in accordance with the ordinary and customary
meaning in light of ``the words of the claims themselves, the remainder
of the specification, the prosecution history, and extrinsic evidence
concerning relevant scientific principles, the meaning of technical
terms, and the state of the art.'' Phillips, 415 F.3d at 1314 (citing
Innova/Pure Water, Inc. v. Safari Water Filtration Sys., Inc., 381 F.3d
1111, 1116 (Fed. Cir. 2004)); see, e.g., Sumitomo Dainippon Pharma Co.,
Ltd. v. Emcure Pharm. Ltd., 887 F.3d 1153, 1157 (Fed. Cir. 2018) (``As
a general rule, the ordinary and customary meaning controls unless `a
patentee sets out a definition and acts as
[[Page 51355]]
his own lexicographer, or . . . the patentee disavows the full scope of
a claim term either in the specification or during prosecution.''')
(quoting Thorner v. Sony Comput. Entm't Am. LLC, 669 F.3d 1362, 1365
(Fed. Cir. 2012)). This rule reflects that the PTAB in an AIA
proceeding will apply the same standard applied in federal courts to
construe patent claims.
Comment 28: Some comments sought clarification because the rule
does not indicate consideration of the ordinary meaning to the skilled
artisan ``at the time of filing the invention'' or as of the ``earliest
effective filing date.''
Response: Consistent with Supreme Court and Federal Circuit case
law, the Phillips claim construction standard applied will be that of
the skilled artisan as of the effective filing date. Phillips, 415 F.3d
at 1313 (Fed. Cir. 2005) (``[T]he ordinary and customary meaning of a
claim term is the meaning that the term would have to a person of
ordinary skill in the art in question at the time of the invention,
i.e., as of the effective filing date of the patent application.'')
(citing Innova, 381 F.3d at 1116 (``A court construing a patent claim
seeks to accord a claim the meaning it would have to a person of
ordinary skill in the art at the time of the invention.'')). This rule
reflects that the PTAB in an AIA proceeding will apply the same
standard applied in federal courts to construe patent claims.
Prior Claim Construction Determinations
Comment 29: Some comments suggested that, in applying the Phillips
standard, the PTAB should consider prior claim constructions from
proceedings in federal court or the ITC.
Response: Under the amended rules as adopted in this final rule,
the PTAB will consider prior claim construction determinations from
federal courts or the ITC that has been timely made of record in an AIA
proceeding. See 37 CFR 42.100, 42.200, and 42.300.
Comment 30: Some comments sought guidance on the intended meaning
of ``considered'' and what level of deference and weight the PTAB will
give to prior claim construction determinations. Some comments
suggested that the PTAB should defer to a prior claim construction by a
district court or the ITC. Others suggest that the proposed rule be
modified to expressly require deference to a prior claim construction
ruling. One comment expressed concerns that applying the Phillips
standard may be unfair if the PTAB considers other tribunals' prior
claim construction determinations when either or both parties did not
participate in the prior proceedings. Another comment expressed
concerns that requiring PTAB to consider prior claim construction
determinations will encourage venue gamesmanship.
Response: The suggestions that the PTAB must necessarily defer to
prior claim constructions are not adopted. The PTAB will consider prior
claim constructions from courts or the ITC, if timely made of record,
and give them appropriate weight. Non-exclusive factors to be
considered may include, for example, how thoroughly reasoned the prior
decision is and the similarities between the record in the district
court or the ITC and the record before the PTAB. It also may be
relevant whether the prior claim construction is final or
interlocutory. These factors will continue to be relevant under the
federal court claim construction standard, which is articulated in
Phillips. The PTAB will also consider whether the terms construed by
the district court or the ITC are necessary to decide the issues before
it. This is not an exclusive list of considerations, and the facts and
circumstances of each case will be analyzed as appropriate.
Comment 31: Some comments sought written guidance addressing how
the PTAB will consider prior claim constructions. Some suggest a series
of detailed questions that the PTAB should answer about what it means
for a prior claim construction to be considered.
Response: The PTAB may provide further guidance in the future on
the question of how the PTAB will consider prior claim constructions as
circumstances warrant. However, at this juncture, the PTAB has not
decided the form that such guidance, if any, will take. Guidance, if
issued, may take the form of, for example, a guidance document, a
Standard Operating Procedure, or designating certain decisions as
informative or precedential. The PTAB expects its guidance, if any,
will be informed by its experience with cases in which a federal court
or the ITC has rendered a claim construction using the same standard as
the PTAB.
The PTAB may treat a prior district court claim construction order
the same way that such an order may be treated by a different district
court. In particular, the PTAB will consider prior claim constructions
from district courts or the ITC, if timely made of record, and give
them appropriate weight. Non-exclusive factors to be considered may
include, for example, how thoroughly reasoned the prior decision is and
the similarities between the record in the district court or the ITC
and the record before the PTAB. It also may be relevant whether the
prior claim construction is final or interlocutory. These factors will
continue to be relevant under the district court claim construction
standard, which is articulated in Phillips. The PTAB will also consider
whether the terms construed by the district court or ITC are necessary
to decide the issues before it. This is not an exclusive list of
considerations, and the facts and circumstances of each case will be
analyzed as appropriate. This rule reflects that the PTAB in an AIA
proceeding will apply the same standard applied in federal courts to
construe patent claims.
Comment 32: Some comments suggested requiring the PTAB in an AIA
proceeding to explain in writing its reasoning when its claim
construction differs from a prior construction of a district court or
the ITC.
Response: As is the current practice, the PTAB will explain in
writing its reasoning and the basis for its decisions on claim
construction. Depending on the circumstances of a given matter, this
may or may not include, for example, a discussion of prior claim
construction decisions and explanation of material differences, if any,
as appropriate.
Comment 33: Some comments suggested that a prior claim construction
by a district court or the ITC will be binding on the PTAB under res
judicata.
Response: A claim construction order from a district court may be
informative to PTAB, just as claim construction from PTAB may be
informative to a district court. The precise legal implications of
either such decision would depend on the specific facts of the cases,
any applicable legal principles, and an analysis of those specific
facts to the applicable legal principles. It is worth noting that
district courts themselves may not be bound by each other's claim
construction orders. Moreover, in many cases, the PTAB will issue a
final decision before the corresponding district court trial has
concluded and a final judgment has been entered. Issue preclusion,
collateral estoppel, and res judicata must each be premised on, among
other things, a final court judgment.
Comment 34: One comment suggested that the Office provide proof
that the district courts will be willing to accept the PTAB's claim
constructions prior to a final decision knowing that these
constructions are not final and might change.
Response: The district courts have the discretion to review and/or
adopt the PTAB's initial or final claim constructions, using their own
factors and reasoning. A prior non-final claim construction by the PTAB
may be
[[Page 51356]]
helpful and considered by the district court, just as a prior claim
construction by the district court may be helpful and considered by the
PTAB, depending on the facts and circumstances of a particular case.
Comment 35: One comment suggested that the PTAB should establish
its rules and practices for construing claims in a way that best
ensures that later tribunals will honor those constructions. The
comment suggests that, in addition to adopting the Phillips standard,
the PTAB should state its intent that PTAB trial determinations be
treated as preclusive on later tribunals.
Response: The district courts have the discretion to review and/or
adopt the PTAB's initial or final claim constructions, using their own
factors and reasoning. A prior non-final claim construction by the PTAB
may be helpful and considered by the district court, just as a prior
claim construction by the district court may be helpful and considered
by the PTAB, depending on the facts and circumstances of a particular
case.
Comment 36: Some comments suggested that the PTAB should defer to
its own prior claim constructions.
Response: The PTAB will continue to give due consideration to its
own prior claim constructions, and where appropriate, may adopt those
constructions. Non-exclusive factors to be considered may include, for
example, how thoroughly reasoned the prior decision is and the
similarities between the records. It also may be relevant whether the
prior claim construction is final or interlocutory. The PTAB will also
consider whether the terms previously construed are necessary to decide
the issues currently before it. This is not an exclusive list of
considerations, and the facts and circumstances of each case will be
analyzed as appropriate.
Comment 37: Some comments sought guidance on the timing and
procedures for submitting claim construction materials from other
tribunals to the PTAB.
Response: Parties should submit a decision on claim construction by
a federal court or the ITC in an AIA proceeding as soon as that
decision becomes available. Preferably, the prior claim construction is
submitted with the petition or preliminary response, with explanations.
After a trial is instituted, the PTAB's rules on supplemental
information govern the timing and procedures for submitting claim
construction decisions. See 37 CFR 42.123, 42.223. Under those rules, a
party must first request authorization from the PTAB to file a motion
to submit supplemental information. If it is more than one month after
the date the trial is instituted, the motion must show why the
supplemental information reasonably could not have been obtained
earlier. Normally, the PTAB will permit such information to be filed,
as long as the final oral hearing has not taken place. The PTAB may
permit a later filing where it is not close to the one-year deadline
for completing the trial. Again, parties should submit the prior claim
construction as soon as the decision is available.
Comment 38: One comment asked whether disclosure of prior claim
construction determinations is optional or subject to mandatory
disclosure under 37 CFR 42.51(b).
Response: Submission of prior claim construction determinations is
mandatory under 37 CFR 42.51(b), if it is ``relevant information that
is inconsistent with a position advanced by the party during the
proceeding.'' In such cases, the determinations should be submitted
``concurrent with the filing of the documents or things that contains
the inconsistency.'' Id.
Comment 39: A comment suggested that the disclosure of any prior
claim constructions by a court or the ITC or any claim constructions
the parties or their privies have offered in a court proceeding or
before the ITC be required.
Response: The current requirement under 37 CFR 42.51(b) for
disclosure of ``relevant information that is inconsistent with a
position advanced by the party during the proceeding'' is sufficient.
District court and ITC claim construction proceedings may involve terms
that are not relevant to issues before the PTAB. To require disclosure
of any term construed by a district court or the ITC would result in
unnecessary filings and inefficiencies in identifying which terms, if
any, are relevant to the trial before the PTAB. Rather, a prior claim
construction must be submitted under 37 CFR 42.51(b), if it is
``relevant information that is inconsistent with a position advanced by
the party during the proceeding.''
Comment 40: One comment asked whether, if the PTAB decides not to
adopt prior claim constructions, the PTAB can make its own claim
constructions. The comment further asked whether the PTAB can only make
constructions asserted by the parties.
Response: When applying the same Phillips standards as applied in
federal court or the ITC, the PTAB may or may not adopt a construction
that has been proposed by one of the parties. For example, the PTAB is
not required to provide constructions that are unnecessary to the
issues before it. In addition, where the PTAB makes a claim
construction determination in its institution decision that differs
from one asserted by the parties, the parties will be afforded an
opportunity to brief the issue after institution.
Effective Date of the Rule Change
Comment 41: Several comments opposed retroactive application of the
rule and requested the proposed changes only apply to new proceedings
filed some time period after announcement of the final rule. Concerns
were expressed that retroactive application of the rule would be
disruptive and would require significant time, effort, and expense to
be spent by the parties (e.g., for supplemental briefing and additional
testimony) and may unfairly prejudice petitioners that have filed
petitions they may not have decided to file under the Phillips
standard.
Response: The Office appreciates the concerns that have been
raised, and adopts the proposed change. While the Office believes the
federal court claim construction standard to be the best standard to
use going forward, given the concerns raised in the comments, the
changes adopted in this final rule will only apply to petitions filed
on or after the effective date of the final rule.
Comment 42: A few comments raised concerns whether the Office has
the authority to apply the new standard retroactively under the
principles articulated in Bowen v. Georgetown Univ. Hosp., 109 S. Ct.
468 (1988) and Landgraf v. USI Film Prods., 114 S. Ct. 1483 (1994).
Response: The Office acknowledges the concerns and recognizes that
a ``statutory grant of legislative rulemaking authority will not, as a
general matter, be understood to encompass the power to promulgate
retroactive rules unless that power is conveyed by Congress in express
terms.'' Bowen, 109 S. Ct. at 472. The change in claim construction
standard, as adopted in this final rule, will only be applied to
petitions filed on or after the effective date of the rule.
Comment 43: Several comments suggested the Phillips claim
construction standard should apply to all proceedings over which the
PTAB maintains jurisdiction upon the effective date of the final rule.
The comments noted this would be consistent with existing practices
under which parties to post-grant proceedings know that claim
construction is subject to modification until the end of trial.
Additionally, a few comments proposed the Phillips standard also be
applied to
[[Page 51357]]
proceedings remanded from the Federal Circuit Court of Appeals.
Response: The Office recognizes the desire of some commenters to
apply the federal court standard as soon as possible to all
proceedings. On balance, the Office has determined the rule changes set
forth in this final rule will only apply to proceedings where a
petition is filed on or after the effective date of the rule.
Comment 44: Some comments expressed concern that, if the rule
changes were applied prospectively only, a large number of petitions
may be filed prior to the effective date of the rule changes by
petitioners seeking to retain the BRI standard, which would strain
administrative resources and could cause unnecessary delay.
Response: The Office appreciates the comments. The rule changes
adopted in this final rule are applicable to any petition filed on or
after the effective date of the final rule. The Office does not
anticipate an inordinate number of petitions to be filed during the 30
day period from publication to effective date.
Comment 45: A few comments suggested that, if the rule changes are
applied to existing proceedings, the PTAB should provide the parties
with the opportunity to file briefs directed to the impact of the
change in the claim construction standard in their proceedings.
Response: The Office agrees and has implemented the final rule such
that the final rule applies only to petitions filed on or after the
effective date. As such, petitioners will have an opportunity to fully
brief the federal court claim construction standard in their petitions
and patent owners will likewise have an opportunity to fully brief this
issue in patent owner preliminary responses.
Additional Suggested Changes
Comment 46: The Office has received a number of suggested changes
to the current AIA proceedings. These suggested changes are directed to
both procedural and statutory changes that go beyond the scope of this
rulemaking. For example, the Office has received comments suggesting
procedural and statutory changes such as handling motions to amend
similar to ex parte reexamination, allowing more live testimony,
limiting petitions to a single ground per claim, precluding hedge funds
from filing petitions, denying multiple petitions against the same
patent, using the substantial new question of patentability standard at
institution, awarding attorney fees for small entities and changing the
preponderance of the evidence burden of proof to a clear and convincing
burden of proof.
Response: The Office appreciates the comments received. The Office
continues to undertake a wholesale examination of AIA proceedings to
determine which areas need improvement and which areas are working
well. The Office may take action in certain areas in the near future
based on its own review and in light of input from the IP community,
some of which may be reflected in the comments received. The Office
will continue to study and make improvements to AIA proceedings as
necessary to ensure a balanced system that meets the congressional
intent of the AIA.
Comment 47: The Office also has received a number of comments
suggesting changes to ex parte examination, including reexamination and
reissue examination procedures. For example, several comments have
requested that the Office adopt a federal court claim construction
standard for reexamination proceedings and reissue applications.
Response: The Office appreciates the comments received; however,
they are beyond the scope of the current rulemaking, which focuses on
AIA proceedings. The Office will take these comments into account as
the Office continually seeks to improve the examination process in
order to provide high quality, efficient examination.
Rulemaking Considerations
A. Administrative Procedure Act (APA): This final rule revises the
rules relating to Office trial practice for IPR, PGR, and CBM
proceedings. The changes set forth in this final rule will not change
the substantive criteria of patentability. These rule changes involve
rules of agency procedure and interpretation. See Perez v. Mortg.
Bankers Ass'n, 135 S. Ct. 1199, 1204 (2015) (Interpretive rules
``advise the public of the agency's construction of the statutes and
rules which it administers.'' (citation and internal quotation marks
omitted)); Bachow Commc'ns, Inc. v. F.C.C., 237 F.3d 683, 690 (D.C.
Cir. 2001) (Rules governing an application process are procedural under
the Administrative Procedure Act.); Inova Alexandria Hosp. v. Shalala,
244 F.3d 342, 350 (4th Cir. 2001) (Rules for handling appeals were
procedural where they did not change the substantive requirements for
reviewing claims.); Nat'l Org. of Veterans' Advocates, Inc. v. Sec'y of
Veterans Affairs, 260 F.3d 1365, 1375 (Fed. Cir. 2001) (Rule that
clarifies interpretation of a statute is interpretive.); JEM Broad. Co.
v. F.C.C., 22 F.3d 320, 328 (D.C. Cir. 1994) (Rules are not legislative
because they do not ``foreclose effective opportunity to make one's
case on the merits.'').
Accordingly, prior notice and opportunity for public comment are
not required pursuant to 5 U.S.C. 553(b) or (c) (or any other law). See
Perez, 135 S. Ct. at 1206 (Notice-and-comment procedures are required
neither when an agency ``issue[s] an initial interpretive rule'' nor
``when it amends or repeals that interpretive rule.''); Cooper Techs.
Co. v. Dudas, 536 F.3d 1330, 1336-37 (Fed. Cir. 2008) (stating that 5
U.S.C. 553, and thus 35 U.S.C. 2(b)(2)(B), do not require notice and
comment rulemaking for ``interpretative rules, general statements of
policy, or rules of agency organization, procedure, or practice''
(quoting 5 U.S.C. 553(b)(3)(A))).
The Office, nevertheless, published the notice of proposed
rulemaking for comment as it sought the benefit of the public's views
on the Office's proposed changes to the claim construction standard for
reviewing patent claims and proposed substitute claims in AIA
proceedings before the Board. See 83 FR 21221.
B. Regulatory Flexibility Act: For the reasons set forth herein,
the Deputy General Counsel for General Law of the United States Patent
and Trademark Office has certified to the Chief Counsel for Advocacy of
the Small Business Administration that changes in this final rule will
not have a significant economic impact on a substantial number of small
entities. See 5 U.S.C. 605(b).
This final rule revises certain rules and trial practice procedures
before the Board. Any requirements resulting from these changes are of
minimal or no additional burden to those practicing before the Board.
For the foregoing reasons, the changes in this final rule will not
have a significant economic impact on a substantial number of small
entities.
C. Executive Order 12866 (Regulatory Planning and Review): This
rulemaking has been determined to be significant, for purposes of
Executive Order 12866 (Sept. 30, 1993).
D. Executive Order 13563 (Improving Regulation and Regulatory
Review): The Office has complied with Executive Order 13563.
Specifically, the Office has, to the extent feasible and applicable:
(1) Made a reasoned determination that the benefits justify the costs
of the rule; (2) tailored the rule to impose the least burden on
society consistent with obtaining the regulatory objectives; (3)
selected a regulatory approach that maximizes net benefits;
[[Page 51358]]
(4) specified performance objectives; (5) identified and assessed
available alternatives; (6) involved the public in an open exchange of
information and perspectives among experts in relevant disciplines,
affected stakeholders in the private sector and the public as a whole,
and provided on-line access to the rulemaking docket; (7) attempted to
promote coordination, simplification, and harmonization across
government agencies and identified goals designed to promote
innovation; (8) considered approaches that reduce burdens and maintain
flexibility and freedom of choice for the public; and (9) ensured the
objectivity of scientific and technological information and processes.
E. Executive Order 13771 (Reducing Regulation and Controlling
Regulatory Costs): This rule is not subject to the requirements of E.O.
13771 because this rule results in no more than de minimis costs.
F. Executive Order 13132 (Federalism): This rulemaking does not
contain policies with federalism implications sufficient to warrant
preparation of a Federalism Assessment under Executive Order 13132
(Aug. 4, 1999).
G. Executive Order 13211 (Energy Effects): This rulemaking is not a
significant energy action under Executive Order 13211 because this
rulemaking is not likely to have a significant adverse effect on the
supply, distribution, or use of energy. Therefore, a Statement of
Energy Effects is not required under Executive Order 13211 (May 18,
2001).
H. Executive Order 12988 (Civil Justice Reform): This rulemaking
meets applicable standards to minimize litigation, eliminate ambiguity,
and reduce burden as set forth in sections 3(a) and 3(b)(2) of
Executive Order 12988 (Feb. 5, 1996).
I. Executive Order 13045 (Protection of Children): This rulemaking
does not concern an environmental risk to health or safety that may
disproportionately affect children under Executive Order 13045 (Apr.
21, 1997).
J. Executive Order 12630 (Taking of Private Property): This
rulemaking will not affect a taking of private property or otherwise
have taking implications under Executive Order 12630 (Mar. 15, 1988).
K. Congressional Review Act: Under the Congressional Review Act
provisions of the Small Business Regulatory Enforcement Fairness Act of
1996 (5 U.S.C. 801 et seq.), prior to issuing any final rule, the
United States Patent and Trademark Office will submit a report
containing the rule and other required information to the United States
Senate, the United States House of Representatives, and the Comptroller
General of the Government Accountability Office. The changes in this
final rule are not expected to result in an annual effect on the
economy of 100 million dollars or more, a major increase in costs or
prices, or significant adverse effects on competition, employment,
investment, productivity, innovation, or the ability of United States-
based enterprises to compete with foreign-based enterprises in domestic
and export markets. Therefore, this rulemaking is not a ``major rule''
as defined in 5 U.S.C. 804(2).
L. Unfunded Mandates Reform Act of 1995: The changes in this final
rule do not involve a Federal intergovernmental mandate that will
result in the expenditure by State, local, and tribal governments, in
the aggregate, of 100 million dollars (as adjusted) or more in any one
year, or a Federal private sector mandate that will result in the
expenditure by the private sector of 100 million dollars (as adjusted)
or more in any one year, and will not significantly or uniquely affect
small governments. Therefore, no actions are necessary under the
provisions of the Unfunded Mandates Reform Act of 1995. See 2 U.S.C.
1501 et seq.
M. National Environmental Policy Act: This rulemaking will not have
any effect on the quality of the environment and is thus categorically
excluded from review under the National Environmental Policy Act of
1969. See 42 U.S.C. 4321 et seq.
N. National Technology Transfer and Advancement Act: The
requirements of section 12(d) of the National Technology Transfer and
Advancement Act of 1995 (15 U.S.C. 272 note) are not applicable because
this rulemaking does not contain provisions which involve the use of
technical standards.
O. Paperwork Reduction Act: The Paperwork Reduction Act of 1995 (44
U.S.C. 3501-3549) requires that the Office consider the impact of
paperwork and other information collection burdens imposed on the
public. This final rule involves information collection requirements
which are subject to review by the Office of Management and Budget
(``OMB'') under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3549). This rulemaking does not add any additional information
requirements or fees for parties before the Board. Therefore, the
Office is not resubmitting information collection packages to OMB for
its review and approval because the revisions in this rulemaking do not
materially change the information collections approved under OMB
control number 0651-0069.
Notwithstanding any other provision of law, no person is required
to respond to, nor shall any person be subject to, a penalty for
failure to comply with a collection of information subject to the
requirements of the Paperwork Reduction Act unless that collection of
information displays a currently valid OMB control number.
List of Subjects in 37 CFR Part 42
Administrative practice and procedure, Inventions and patents.
For the reasons set forth in the preamble, the Office amends part
42 of title 37 as follows:
PART 42--TRIAL PRACTICE BEFORE THE PATENT TRIAL AND APPEAL BOARD
0
1. The authority citation for 37 CFR part 42 continues to read as
follows:
Authority: 35 U.S.C. 2(b)(2), 6, 21, 23, 41, 135, 311, 312, 316,
and 321-326; Public Law 112-29, 125 Stat. 284; and Pub. L. 112-274,
126 Stat. 2456.
0
2. Amend Sec. 42.100 by revising paragraph (b) to read as follows:
Sec. 42.100 Procedure; pendency.
* * * * *
(b) In an inter partes review proceeding, a claim of a patent, or a
claim proposed in a motion to amend under Sec. 42.121, shall be
construed using the same claim construction standard that would be used
to construe the claim in a civil action 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. 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 inter partes review
proceeding will be considered.
* * * * *
0
3. Amend Sec. 42.200 by revising paragraph (b) to read as follows:
Sec. 42.200 Procedure; pendency.
* * * * *
(b) In a post-grant review proceeding, a claim of a patent, or a
claim proposed in a motion to amend under Sec. 42.221, shall be
construed using the same claim construction standard that would be used
to construe the claim in a civil action 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
[[Page 51359]]
ordinary skill in the art and the prosecution history pertaining to the
patent. 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 post-grant
review proceeding will be considered.
* * * * *
0
4. Amend Sec. 42.300 by revising paragraph (b) to read as follows:
Sec. 42.300 Procedure; pendency.
* * * * *
(b) In a covered business method patent review proceeding, a claim
of a patent, or a claim proposed in a motion to amend under Sec.
42.221, shall be construed using the same claim construction standard
that would be used to construe the claim in a civil action 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. 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 covered business
method patent review proceeding will be considered.
* * * * *
Dated: October 3, 2018.
Andrei Iancu,
Under Secretary of Commerce for Intellectual Property and Director of
the United States Patent and Trademark Office.
[FR Doc. 2018-22006 Filed 10-10-18; 8:45 am]
BILLING CODE 3510-16-P