PTAB’s First Oral Hearing in a Derivation Proceeding

The PTAB conducted its first oral hearing in a derivation proceeding instituted under 37 C.F.R. § 42.400 et seq.  Andersen Corp. v. GED Integrated Solutions, Inc., DER2017-00007 (Paper 56). We previously discussed this case’s institution decision here on the AIA Blog, explaining that the AIA essentially replaced interference proceedings with derivation proceedings and how, in this case, the PTAB instituted 22 separate derivation grounds on spacer frame assemblies for windows. 

The purpose of a derivation proceeding is to determine whether an inventor named in an earlier application derived the claimed invention from an inventor named in the petitioner's application, and whether the earlier application claiming such invention was filed without authorization. See 35 U.S.C. § 135(a)(1); 37 C.F.R. § 42.405(b)(2). Accordingly, at the hearing, the parties addressed whether the petitioner had conceived of every feature of the copied claims, whether those features were communicated to the respondent, and whether inventor testimony was sufficiently corroborated.  The parties disputed whether certain features were necessarily present and how a person of ordinary skill in the art would have understood certain terms of art. 

In addition to these case-specific questions, the parties disputed the standard of proof the Board should apply in derivation proceedings.  The respondent argued that a derivation proceeding occurs against an existing patent, which has a presumption of validity, so the clear-and-convincing standard applies.  The petitioner disagreed, arguing that the preponderance standard applies.  According to the petitioner, the respondent’s cases applying the clear-and-convincing standard involved 35 U.S.C. § 102(f) in district court actions, so they do not establish the standard to be applied by the PTAB in this case.

For those interested in PTAB trial procedure, in a Trial Hearing Order, the Board granted the parties’ request for 60 minutes each for oral argument, specifying that the petitioner may reserve no more than 30 minutes for rebuttal and the respondent may reserve no more than 10 minutes for sur-rebuttal. (Paper 55 at 2.) During a pre-hearing conference call, the Board stated its preference to address objections to demonstratives during that conference, but also agreed that the parties could address objections either at the beginning or end of their presentation at the hearing. (Exhibit 2048 at  8, 9, 13-14.)  The Board generally declined to identify specific issues for the parties to address at the hearing, but noted that if the parties had a disagreement on any issue, they should cover that issue at the hearing.  (Id. at 16-17.)  The Board declined one party’s offer to submit video clips of deposition testimony, instead stating that the panel would rely on the deposition transcripts instead.  (Id. at 17-18.)  Finally, the Board and parties confirmed that the petitioner intended to bring a physical prototype product for use at the hearing.  (Id. at 18.)

Stay tuned to the AIA Blog for additional coverage after the PTAB issues its final written decision, which is scheduled to occur by March 21, 2019.