Trending at the PTAB: 6 Areas to Watch in 2024

Happy 2024! Last year was a big one at the Patent Trial and Appeal Board, amid guidance memorandums, updates to the director review process, and policy shaped through the designation of precedential opinions and director review decisions.

The U.S. Patent and Trademark Office requested the public's comments on issues concerning discretionary denials, motions to amend and internal circulation procedures. Practitioners saw even proposed legislation that aims to reform the PTAB.

Based on 2023's trends, here are some of the things we expect to hear more about this year.

1. Rulemaking

In 2023, the office released several notices for proposed rules or requested comments on discretionary denials, motions to amend and internal PTAB procedures. These rulemaking initiatives seem to coincide with USPTO Director Kathi Vidal's efforts to have an efficient, transparent and fair patent system.[1]

Perhaps the most noteworthy of the rulemaking initiatives in 2023 was the advance notice of proposed rulemaking that requested feedback on a variety of topics, including certain existing and new discretionary denial practices, advanced bionics framework, serial petitions, multiple simultaneous petitions, settlements, and sanctions.[2]

Vidal has emphasized that the ANPRM was just a first step to determine whether a rule is needed.[3] She has indicated that after reviewing the submitted comments, the office hopes to release a proposed rule.[4]

The comment period for the ANPRM ended on June 20, 2023. Practitioners and stakeholders alike anxiously anticipate more details on what the proposed rule will look like — if it comes at all.

The USPTO issued a request for comments regarding the PTAB's Motion to Amend Pilot Program and rules related to amendments during PTAB proceedings.[5] Because the MTA Pilot Program is set to expire on Sept. 16, these comments will shape how, if at all, the office decides to change or continue the MTA program.

In October 2023, the USPTO issued a notice of proposed rulemaking regarding the board's preissuance internal circulation and review of decisions.[6]

The NPRM was accompanied by a new Standard Operating Procedure 4 concerning its interim process for internal PTAB circulation and review,[7] and updated Standard Operating Procedure 9 — now SOP3[8] concerning PTAB decisions remanded from the U.S. Court of Appeals for the Federal Circuit.

The comment period closed on Dec. 5, 2023. Considering that the PTAB has already implemented these changes, we expect to see a final rule in 2024 that addresses many of the public's concerns.

2. Director Review

Last year, the office updated the interim director review process.[9] As of the publication of this article, the revised interim director review process and the appeals review panel process replaced the precedential opinion panel process.[10] The office highlighted that this director review process is not finalized, which could mean we will see more changes this year.[11]

There was an uptick in the number of granted director review cases in 2023.[12] As the director continues to grant cases, practitioners should take note to better understand how to most effectively utilize the director review process.

3. Delegated Rehearing Panel

As part of the revised interim director Review Process, the Office established the Delegated Rehearing Panel to which the director may delegate PTAB decisions arising from America Invents Act proceedings for further consideration, including those decisions in which a potential issue may have been misapprehended or overlooked by the board.[13]

In the last few months of 2023, the director delegated two cases to the DRP. These include DK Crown Holdings Inc. v. Diogenes Ltd.[14] and SynAffix B.V. v. Hangzhou DAC Biotech Co. Ltd.[15] Both cases involve instances where the board denied institution. The director has instructed the DRP to consider whether the board properly denied institution or whether the board misapprehended or overlooked any issues.

As these are the first two DRP cases, they will likely give practitioners a better idea of how the DRP will be used and how to effectively advocate for clients when arguing before the DRP.

4. Appeals Review Panel

So far, the Appeals Review Panel has not been used. But in In re: Xencor, Inc., the USPTO has requested that the Federal Circuit remand this appeal "to permit further consideration and issuance of a revised decision by the Appeals Review Panel."[16]

Depending on how the Federal Circuit rules, In re: Xencor may be the first case that the Appeals Review Panel hears.

5. PTAB at the Federal Circuit

While there are many PTAB cases on appeal to the Federal Circuit, here are a few decisions we await in 2024.

The Federal Circuit held oral arguments in CyWee Group Ltd. v. ZTE (USA) Inc.[17] in September 2023. This case involves an appeal of an inter partes review where the board allowed an otherwise time-barred petitioner, LG Electronics Inc., to join an instituted case involving lead petitioner ZTE.

CyWee and ZTE reached a settlement agreement, leaving LGE as the only petitioner. CyWee filed a motion to amend, and the board allowed LGE to oppose the motion.

The board eventually found the amended claims to be unpatentable as obvious over the prior art LGE presented. On appeal, the USPTO intervened to defend the board's decision.

This case is one to watch because it involves a time-bar issue and, if the Federal Circuit reaches it, an issue of to what extent a joined party can participate in a motion to amend.

LKQ Corp. v. GM Global Technology Operations LLC[18] involves an appeal of an IPR of a design patent. As background, the obviousness standards differ between design and utility patents — while the U.S. Supreme Court's 2007 KSR International Co. v. Teleflex Inc. decision supplies the obvious standard for utility patents, the Rosen-Durling standard applies to design patents.

The board found that LKQ failed to demonstrate that the challenged patent was obvious under Rosen-Durling. And the Federal Circuit affirmed the board's decision.[19] LKQ filed a petition for rehearing en banc, and the Federal Circuit granted the petition.[20]

On rehearing, the Federal Circuit will determine whether the KSR obviousness standard should apply to design patents, potentially changing a 40-year-old precedent.

In the Aug. 23, 2023, In re: Cellect LLC decision, the Federal Circuit held that the obviousness-type double patenting analysis for a patent that has received patent term adjustment must be based on the expiration date of the patent after the PTA has been added, regardless of whether a terminal disclaimer is required or has been filed.[21]

This decision received a lot of attention because it changed how PTA was previously being decided. Cellect has petitioned a rehearing en banc, prompting numerous amici to weigh in. We await the Federal Circuit's decision on whether to rehear the case in 2024.

6. Legislation Affecting PTAB

Last year, Congress introduced the Promoting and Respecting Economically Vital American Innovation Leadership, or PREVAIL, Act.[22]

The PREVAIL Act aims to amend the AIA and reform the PTAB. A few of these changes include creating a standing requirement for IPR petitioners, limiting the number of petitions against the same patent, and prohibiting parallel litigation of invalidity based on patents or printed publications at the PTAB and in the district court.

The PREVAIL Act would be a significant PTAB reform. Practitioners should keep an eye on the proposed bill in 2024 to see how it progresses.

Endnotes

[1] https://www.judiciary.senate.gov/imo/media/doc/2023-07-26_pm_-_testimony_-_vidal.pdf.

[2] https://www.govinfo.gov/content/pkg/FR-2023-04-21/pdf/2023-08239.pdf.

[3] https://www.uspto.gov/about-us/news-updates/remarks-uspto-director-kathi-vidal-aipla-spring-meeting.

[4] Id.

[5] https://www.federalregister.gov/documents/2023/05/23/2023-10565/request-for-comments-regarding-the-motion-to-amend-pilot-program-and-rules-of-practice-to-allocate.

[6] https://www.govinfo.gov/content/pkg/FR-2023-10-06/pdf/2023-22218.pdf.

[7] https://www.uspto.gov/sites/default/files/documents/ptab_sop_4-2023-oct.pdf?utm_campaign=subscriptioncenter&utm_content=&utm_medium=email&utm_name=&utm_source=govdelivery&utm_term=.

[8] https://www.uspto.gov/sites/default/files/documents/ptab_sop_3-2023-oct.pdf?utm_campaign=subscriptioncenter&utm_content=&utm_medium=email&utm_name=&utm_source=govdelivery&utm_term=.

[9] https://www.uspto.gov/patents/ptab/decisions/revised-interim-director-review-process.

[10] https://www.uspto.gov/patents/ptab/decisions/revised-interim-director-review-process.

[11] https://www.uspto.gov/patents/ptab/decisions/revised-interim-director-review-process.

[12] Cite to the 2023 Review Article.

[13] https://www.uspto.gov/patents/ptab/decisions/delegated-rehearing-panel.

[14] DK Crown Holdings Inc. v. Diogenes Ltd., IPR2023-00268, Paper 11 (November 7, 2023).

[15] SynAffix B.V. v. Hangzhou DAC Biotech Co., Ltd., IPR2022-01531, Paper 19 (November 16, 2023).

[16] https://cdn.patentlyo.com/media/2023/12/Xencore-USPTO-Reply-Brief-on-Remand.pdf.

[17] https://cafc.uscourts.gov/home/oral-argument/listen-to-oral-arguments/.

[18] LKQ Corp. v. GM Glob. Tech. Operations LLC, No. 2021-2348, 2023 U.S. App. LEXIS 1412, at *2 (Fed. Cir. Jan. 20, 2023).

[19] Id.

[20] LKQ Corp. v. GM Glob. Tech. Operations LLC, 71 F.4th 1383, 1384 (Fed. Cir. 2023) (granting LKQ's petition to rehear the case en banc).

[21] In re: Cellect, LLC, 81 F.4th 1216, 1229 (Fed. Cir. 2023).

[22] https://www.govinfo.gov/app/details/BILLS-118s2220is.