In early November, Senior Party the Broad Institute (along with Harvard University and the Massachusetts Institute of Technology) filed their response to Junior Party the University of California/Berkeley, the University of Vienna, and Emmanuelle Charpentier (collectively, "CVC") Opposition to the Broad's Substantive Motion No. 1 in Interference No. 105,166.
Pursuant to the Patent Trial and Appeal Board's rules, the Broad's Reply Brief follows formulaically with Senior Party's point-by-point rebuttal of CVC's grounds for opposition. CVC's first asserted opposition argument was that "judgment estoppel" (quotation marks in opposition brief) does not exist in any form that would prelude this interference. The Broad characterizes this argument as "remarkable," and that it "not only displays a lack of understanding regarding the development of the estoppel rule in interferences, but it also misstates common law estoppel principles." Segueing to the question of "motion estoppel" under Rule 41.127(a), the Broad traces the provisions of this Rule to former Rule 1.658(c), which provided (according to the Broad) for "broad application of estoppel for any type of interference judgment and further listed specific motions that needed to be raised lest motion estoppel apply, including failure to move to add a new claim" (which the Broad argues is the case here). These considerations did not change with revision of the interference rules, according to the Reply Brief, and thus the Board remains empowered under the rules to grant its motion that CVC should be estopped in this interference by the Board's judgment in the prior interference (No. 105,048).
The brief next argues that Rule 127 applies to judgments of no interference-in-fact, contrary to CVC's argument that it cannot because there is no "losing" party under those circumstances, on the basis that there is no express provision in the Rule to this effect. According to the Broad, "the first sentence sets out a general rule, while the second sentence applies it to losing parties and sets out an exception for losing parties"; this does not negate application of estoppel to CVC under the circumstances of this interference, according to the Broad.
The Broad takes direct issue with CVC's argument that the PTAB is powerless to apply estoppel here because doing so would be contrary to "common law estoppel principles," saying bluntly (with reference to Wright's Federal Practice and Procedure treatise) that CVC "misapprehends fundamental principles of claim and issue preclusion," specifically that common law estoppel "foreclos[e] any litigation of matters that never have been litigated, because of a determination that they should have been advanced in an earlier suit." This argument also supports the Broad's rebuttal that 35 U.S.C. § 135(a) "mandates that the PTAB resolve any and all potential priority issues," saying that "the Federal Circuit rejected this argument long ago" citing Eli Lilly & Co. v. Bd. of Regents of Univ. of Washington, 334 F.3d 1264, 1267 (Fed. Cir. 2003). According to the Broad, "[t]he PTAB thus has the discretion and authority to promulgate rules for discontinuing interferences, including estoppel rules that provide consequences for a party's failure to make timely motions."
The brief then reiterates its argument that CVC had the opportunity (to which it did not avail itself) to add a claim to eukaryotic cell embodiments of CRISPR technology in the '048 Interference (pointing out that CVC had indicated in that prior interference that it "might seek authorization to file such a responsive motion"). Having failed to prevail in that interference the Broad characterizes CVC's position in this interference as attempting to get a "second bite at the apple" that the estoppel rules preclude. Further, the Broad disputes CVC's argument that it "could not have moved to add a eukaryotic claim in the '048 Interference because it had no allowed eukaryotic claims at that time," asserting that Standing Order ¶ 208.5.1 permits this. And the Broad rejects CVC's assertion that the Broad could have moved just as well, because Standing Order ¶ 208.5.1 requires the moving party to certify that such a claim was patentable to CVC, which the Broad could not (and certainly would not) do.
Finally in this portion of the brief, the Broad challenges CVC's argument that the "the alleged separate patentability of single-molecule RNA claims" over the Count in the '048 Interference raises a factual issue that precludes the Board from granting the Broad's Substantive Motion No. 1. Here, the Broad argues that this argument is "legally irrelevant," because CVC had the opportunity to file claims to interfering subject matter (i.e., "eukaryotic claims limited to use of single-molecule RNA") but did not.
Returning to the issue of "judgment estoppel," the brief cites MPEP § 2308(b) for the proposition that such estoppel "bars a second interference as to 'claims to the same invention as the count of the interference.'" That is the case here, because "the Broad's single-molecule RNA claims were designated as corresponding to the prior Count," a designation never challenged by CVC.
The brief then sets forth detailed arguments for each of its propositions regarding why CVC's Opposition fails to rebut its arguments in support of Substantive Motion No. 1. To CVC's argument that Rule 127 estoppel does not apply to judgments of no interference-in-fact, the Broad argues that CVC's argument "conflicts with the language of the first sentence and does not give application to both sentences." The first sentence of the Rule, the Broad argues, sets out estoppel without regard to "winners" and "losers," while the second sentence is directed at the "losing" party and setting forth an exception for "any contested subject matter for which that party was awarded a favorable judgment." In the Broad's calculus, neither of these provisions provides CVC with the benefit of pursuing this interference after having failed to pursue subject matter relating to eukaryotic cell embodiments of CRISPR in the '048 Interference. The Broad further cites the Notice of Proposed Rulemaking for Rule 127, 68 Fed. Reg. 66648, 66661 (Nov. 26, 2003), which they argue "flatly contradict[s]" CVC's interpretation of the Rule, and further notes that CVC's argument amounts to an admission that Rule 127 applies to situations where the Board finds there to be no interference-in-fact. Finally on this point the Broad disputes CVC's characterization of the Board's finding of no interference-in-fact as being merely jurisdictional and amounting to dismissal; in their view the Board entered judgment and thus that decisions provokes the estoppel effects set forth in Rule 127.
The brief then sets out an exposition of the Broad's understanding and assertion of the development of the PTAB's estoppel rules, going into detail regarding the similarities and differences between Rule 1.658(c) and Rule 127. In brief, the Broad argues that Rule 1.658(c) applied to "any type of judgment" and that revision of the Rule did not change (and was not intended to change) the scope of this estoppel. And here the brief revisits a familiar refrain, asserting that under Rule 1.658(c) the estoppel would apply for a party that failed to file a motion to add a claim regardless of whether judgment was entered on priority or "ancillary grounds," meaning in this case a finding of no interference-in-fact.
The Broad also argues that these estoppel rules promulgated by the PTAB are not inconsistent with common law principles. Citing Nevada v. United States, 463 U.S. 110, 129-30 (1983), they argue that "common law principles recognize that final judgment in an action results in estoppel with respect to undecided issues that could have been raised but were not" (and further assert that the case CVC cited in support of its position, Duvall v. Atty. Gen. of U.S., 436 F.3d 382, 388 (3d Cir. 2006), is in fact consistent with the Broad's own analysis of estoppel principles in the interference context.
Next, the Broad maintains that there is no statutory requirement that the PTAB always determine priority, based in the Board's discretion whether to declare an interference in the first place (although this argument does not reach the question of whether such a requirement arises once the PTO properly institutes an interference proceeding, although the brief does cite the Director's discretion (but surely not unfettered) to discontinue an interference).
The brief then turns to a disquisition on why CVC's arguments are merely "post-hoc" attempts to be absolved from its failure to move to add eukaryotic CRISPR claims in the '048 Interference. (Indeed, the entirety of the Broad's argument boils down to this point.) The Broad rebuts CVC's contention that its claims were not in condition for allowance as a rationale (amounting to essentially a ripeness argument), based on the absence of any such requirement in Standing Order ¶ 208.5.1 (albeit being an argument of inference rather than directly stated). The Broad further characterizes CVC's arguments as improperly attempting to blame the PTAB for its failure to move, citing colloquy from the teleconference between the parties and the Board regarding authorization to file motions. The Broad states frankly that CVC's argument that the Broad was required to add a claim directed to eukaryotic CRISPR to CVC's application in the '048 Interference was wrong, because Standing Order ¶ 208.5.1 would have required the Broad to "[c]ertify that the movant is not aware of any reason why the claim is not patentable," which they certainly were not willing to do. The brief points out the inconsistency in CVC's arguments regarding prosecution strategy in view of CVC having previously presented eukaryotic CRISPR claims before (and then cancelling them) suggesting the '048 Interference. Finally, the Broad (in a more semantical than legal argument) attempts to rebut CVC's argument that it had not provoked an interference in this case, because by copying the Broad's claims it did so (as opposed to suggesting an interference), which CVC certainly did not do.
The brief ends with two points. First, that this interference is estopped in totality (in opposition to CVC's argument that the scope of any estoppel is limited to dual-molecule CRISPR embodiments), addressing both motion estoppel and judgment estoppel, and restating succinctly its argument in favor of estoppel:
The PTAB's rules afforded CVC every opportunity to present claims and arguments regarding the eukaryotic subject matter of the 048 Interference. The PTAB's rules do not allow a second run at another party's claims to that same subject matter in a later interference. Indeed, allowing otherwise would vitiate the goals of finality and efficiency served by the estoppel rules.
And of course the Broad does not miss its opportunity to state unequivocally that "CVC's claims should not issue" in the event that this interference should be dissolved based on the Broad's own arguments about estoppel:
CVC's argument ignores that Broad has already been awarded claims to the eukaryotic invention in issued patents. CVC cannot obtain claims to the same subject matter absent an interference with Broad. CVC could have had such an interference previously but strategically declined to give the PTAB the option of implementing such an interference at that time. Accordingly, CVC is estopped from pursuing such an interference, and cannot obtain Broad's eukaryotic claims.
