Top Stories of 2017: #15 to #19

by McDonnell Boehnen Hulbert & Berghoff LLP
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After reflecting upon the events of the past twelve months, Patent Docs presents its 11th annual list of top patent stories.  For 2017, we identified nineteen stories that were covered on Patent Docs last year that we believe had (or are likely to have) a significant impact on patent practitioners and applicants.  Today, we count down stories #19 to #15, and then in the coming week, we will work our way towards the top stories of 2017.  As with our other lists (2016, 2015, 2014, 2013, 2012, 2011, 2010, 2009, 2008, and 2007), links to our coverage of these stories (as well as a few links to articles on related topics) have been provided in case you missed the articles the first time around or wish to go back and have another look.  As always, we love to hear from Patent Docs readers, so if you think we left something off the list or disagree with anything we included, please let us know.  In addition, we will be offering a live webinar on the "Top Patent Law Stories of 2017" on January 17, 2018 from 10:00 am to 11:15 am (CT).  Details regarding the webinar, which will focus on a handful of the most important stories on this year's list, can be found here.


19.  PTAB Finds No CRISPR Interference

CRISPR (an acronym for Clustered Regularly lnterspaced Short Palindromic Repeats), which is part of a system for altering chromosomal sequences in situ in a cell in combination with a bacterially derived protein called Cas9, was hailed as a "Breakthrough of the Year" for 2015.  CRISPR provides a mechanism for inserting or deleting specific DNA sequences using CRISPR-associate targeting RNAs and the Cas9 RNA-guided DNA endonuclease enzyme.  Given the commercial potential of this method, patenting is an obvious concern and, as it turned out, more than one group of inventors filed patent applications on the reagents, methods, and cells produced or used to produce CRISPR modifications.  Because these applications were filed prior to March 16, 2013, the dispute regarding who was the first to invent had to be resolved via an interference.  In 2016, the USPTO declared Interference No. 106,048, naming Feng Zhang and his colleagues, the named inventor of the Broad Institute/MIT's patents, as the Junior Party, and Jennifer Doudna and her colleagues at UC/Berkeley as Senior Party.  In February of 2017, the Patent Trial and Appeal Board (PTAB) handed down its decision, finding no interference-in-fact between several patents and patent applications owned by The Broad Institute and applications owned by the Regents of the University of California, Berkeley.  The decision ended the interference without any prejudice to any of the claims corresponding to the interference count, allowing both parties to license (and assert) their patents to (or against) any third party.  The basis for the decision was that UC's claims would not anticipate the Broad's claims-in-interference because all of Broad's claims contained the affirmative limitation that the CRISPR technology be operative in eukaryotic cells, and the UC's claims were devoid of any limitation regarding the context in which CRISPR was applied.  In April, the University of California, Berkeley filed a Notice of Appeal at the Federal Circuit, challenging the decision, so the dispute could make a third straight trip to our list of top stories next year -- the CRISPR patent dispute was #18 on last year's list.

For information regarding this and other related topics, please see:

• "Berkeley Files Opening Brief in CRISPR Appeal," July 31, 2017
• "University of California/Berkeley Appeals Adverse CRISPR Decision by PTAB," April 13, 2017
• "PTAB Decides CRISPR Interference in Favor of Broad Institute -- Their Reasoning," February 16, 2017
• "PTAB Decides CRISPR Interference -- No interference-in-fact," February 15, 2017


18.  Unitary Patent and Unified Patent Court Timetable Revised

After making it onto our 2012 and 2013 lists, the unitary patent and Unified Patent Court (UPC) initiatives took a three-year sabbatical from our top stories list.  In 2013, the Council of the European Union announced that twenty-four member states had signed the international agreement that would establish a Unified Patent Court (UPC), a specialized court having exclusive jurisdiction over infringement and validity questions related to unitary patents.  The signing of the Unified Patent Court Agreement (UPCA) initiated the process of ratification by national parliaments, with ratification requiring at least thirteen member states (including France, Germany, and the United Kingdom).  Ratification of the UPC agreement would then result in implementation of two EU regulations on the unitary patent.  Back in 2013, it was thought that ratification might not take place until 2015 or 2016, or perhaps even later in 2017 or 2018.  In January of 2017, the Preparatory Committee of the UPC released a revised timetable indicating that the Sunrise Period during which existing European Patents can be opted out of the jurisdiction of the UPC could start in September 2017 and the UPC could start accepting cases in December 2017 -- provided that the UK and Germany ratified the UPCA, permitting it to come into effect.  While the UK announced its intention to proceed with ratification, the German Constitutional Court asked the German Federal President in June not to ratify the UPCA for the time being.  The Preparatory Committee confirmed at the time that the preliminary timetable set out earlier in the year was no longer achievable, and that the UPC would not begin to operate before the end of 2017.  This latest setback will likely delay the UPCA from coming into force until at least the spring of 2018.

For information regarding this and other related topics, please see:

• "UK Progress on Unitary Patent (UP) and Unified Patent Court (UPC)," July 12, 2017
• "German Constitutional Court Holds up German Ratification of Unitary Patent Court Agreement," June 13, 2017
• "Revised Provisional Timetable for the Unitary Patent and Unified Patent Court," January 23, 2017


17.  Federal Circuit to Hear Attorneys' Fees Case En Banc

Patent applicants dissatisfied with final outcome of patent prosecution proceedings have long had two options for court review of a decision made by the U.S. Patent and Trademark Office's Patent and Trademark Appeal Board (PTAB):  an appeal to the Federal Circuit under 35 U.S.C. § 141 or a civil action in the Eastern District of Virginia under 35 U.S.C. § 145.  For over 175 years, applicants faced the same risk of paying the USPTO's fees in either proceeding.  But in June, a divided panel of the Federal Circuit affirmed in Nantkwest, Inc. v. Matal that the USPTO was entitled to recover attorneys' fees (and other expenses) regardless of the outcome of the case.  In August, however, the Federal Circuit issued a per curiam, sua sponte order that the question be heard en banc.  The order requested that the parties submit briefs addressing the following question:

Did the panel in NantKwest, Inc. v. Matal, 860 F.3d 1352 (Fed. Cir. 2017) correctly determine that 35 U.S.C. § 145's "[a]ll the expenses of the proceedings" provision authorizes an award of the United States Patent and Trademark Office's attorneys' fees?

For information regarding this and other related topics, please see:

• "My Health, Inc. v. ALR Technologies, Inc. (E.D. Tex. 2017)," December 26, 2017
• "Federal Circuit Orders Rehearing En Banc in Nantkwest v. Matal," August 31, 2017
• "Nantkwest, Inc. v. Matal (Fed. Cir. 2017)," June 27, 2017


16.  Federal Circuit Again Limits Scope of CBM Review

The Leahy-Smith America Invents Act (AIA) defines a covered business method (CBM) patent as "a patent that claims a method or corresponding apparatus for performing data processing or other operations used in the practice, administration, or management of a financial product or service, except that the term does not include patents for technological inventions."  For the purpose of determining whether a CBM review is to be instituted, the U.S. Patent and Trademark Office's Patent Trial and Appeal Board (PTAB) considers "whether the patent claims activities that are financial in nature, incidental to a financial activity, or complementary to a financial activity."  In 2016, in Unwired Planet, LLC v. Google Inc., the Federal Circuit resolved the issue, determining that the PTAB's "reliance on whether the patent claims activities incidental to or complementary to a financial activity as the legal standard to determine whether a patent is a CBM patent was not in accordance with law."  In February of 2017, in Secure Axcess, LLC v. PNC Bank National Association, the Federal Circuit again overturned a decision by the PTAB that a patent was eligible for CBM review.  In Secure Axcess, the Court determined that the statute requires that it is the claims, in the traditional patent law sense, properly understood in light of the written description, that identifies a CBM patent.  The Federal Circuit therefore determined that the Board had erred in deciding this case under its overly-broad statutory definition of a CBM patent, and thus vacated the Board's other determinations, including claim constructions and the Board's finding of obviousness.

For information regarding this and other related topics, please see:

• "Securus Technologies, Inc. vs. Global Tel*Link Corp. (PTAB 2017)," September 5, 2017
• "Cloud9 Technologies LLC v. IPC Systems, Inc. (PTAB 2017)," July 30, 2017
• "Secure Axcess, LLC v. PNC Bank National Association (Fed. Cir. 2017)," February 28, 2017


15.  Federal Circuit & PTAB "Loosen" Reins on Amendments in IPR Proceedings

In March, the U.S. Patent and Trademark Office's Patent Trial and Appeals Board (PTAB) granted a motion to amend claims in Amerigen Pharmaceuticals Ltd. v. Shire LLC (IPR2015-02009).  As those in the patent community are well aware, this was an uncommon event.  As of 2016, the PTAB had reported in its Motion to Amend Study that only 6 motions to amend had been granted (or granted-in-part) -- out of a total of 118 motions filed in 1539 instituted and completed AIA proceedings, which amounted to a positive outcome for the patent owner in 5% of the cases in which a motion was filed.  In October of 2017, in Aqua Products, Inc. v. Matal, a highly fractured en banc Federal Circuit determined that the PTAB can no longer place the burden of establishing the patentability of amended claims on the patent owner in IPR proceedings.  There are those in the patent community that believe Aqua Products should result in more claim amendments surviving IPR proceedings, and that the decision may increase the possibility that more motions to amend will be filed.  In November, PTAB Chief Judge David P. Ruschke issued a memorandum entitled "Guidance on Motions to Amend in view of Aqua Products," in which Judge Ruschke noted that patent owners must still meet the requirements for amending the claims as found in 37 C.F.R. § 42.121 (or § 42.211 for PGR proceedings), including only proposing a reasonable number of substitute claims, not enlarging the claim scope or introducing new matter, and making the claim amendments responsive to a ground of unpatentability involved in the trial.

For information regarding this and other related topics, please see:

• "PTAB Motions to Amend Post-Aqua Products -- Chief Judge Ruschke Issues Guidance," December 28, 2017
• "Aqua Products, Inc. v. Matal (Fed. Cir. 2017)," October 4, 2017
• "PTAB Update -- Shire Has Rare Motion to Amend Granted," April 10, 2017

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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