Inter partes reviews (IPRs) are litigation-like procedures held before the Patent Trial and Appeal Board (PTAB) of the United States Patent and Trademark Office that are used to challenge the validity of patents. Typically, an IPR takes a year, and the PTAB will rule on the validity of the challenged patent only after considering extensive briefing and expert testimony on the merits of the patent and prior art. IPR rules require both the patent challengers and patent owners to make certain mandatory disclosures at the start of the IPR. IPR participants have generally interpreted these disclosure requirements as minimal. But in a recent, unprecedented decision, the PTAB invalidated five patents as a sanction for the patent owner’s reluctant compliance with its mandatory disclosure obligations. In so doing, the PTAB appears to have made the mandatory disclosure requirements stricter and broader.
In the case at issue, Longhorn Vaccines and Diagnostics sued Spectrum Solutions for infringing five patents. Spectrum then petitioned the PTAB to review Longhorn’s asserted patents based on a particular prior art reference. Longhorn sought to avoid the IPRs by arguing that the scope of the patent claims should be construed narrowly so at to distinguish the prior art reference. Unpersuaded, the PTAB instituted five IPRs, preliminarily ruling that the scope of the claims was broader such that the prior art reference was not distinguished.
During the IPRs, Longhorn’s technical expert relied on certain testing, which Longhorn commissioned, to show that, under Longhorn’s proposed claim construction, an example disclosed in the prior art reference did not satisfy the claim limitations. At the deposition of the expert, Spectrum asked about other testing that Longhorn may have commissioned. Longhorn objected to these questions about the testing, asserting that the information was protected from discovery by the attorney work product doctrine, which protects the lawyers’ litigation strategy.
Spectrum asked the PTAB to intervene and order Longhorn’s expert to respond to the disputed questions. The PTAB also ordered Longhorn to comply with IPR Rule 42.51, which requires disclosure of information that is inconsistent with a position advanced by a party. Relying on Rule 42.51, the PTAB explained that Longhorn must produce information about all the testing Longhorn commissioned without regard for the claim construction on which Longhorn relied to support its arguments in favor of patentability. Although Longhorn made three witnesses involved in its testing available for deposition and produced some additional documents related to the testing, Spectrum moved for sanctions.
Despite Longhorn’s compliance with the PTAB’s orders, the PTAB still found that Longhorn had at least delayed and resisted complying with its mandatory disclosure obligations under Rule 42.51. The PTAB reasoned that the preliminary “claim construction in the institution decisions … indicates the scope of what [is] deemed relevant to the issue of patentability.” According to the PTAB, that Longhorn based its patentability arguments on its own proposed narrower claim constructions did not limit the information subject to mandatory disclosure. The PTAB reminded the public of the limitations of privilege and work product protection. Setting aside the merits of the IPRs, the PTAB unanimously sanctioned Longhorn by cancelling all five of the challenged patents.
This is the first time the PTAB has canceled a patent in an IPR for patent owner misconduct. While this decision has not yet been made precedential, in the interim, IPR participants should understand that the PTAB expects participants to produce information relevant to the claims as they are preliminarily construed in the institution decision, not just as the participant proposes to construe the claims. This ruling could make IPRs a more robust and effective alternative to patent litigation.