Advanced Practice Under the American Invents Act (AIA). Post Issuance Proceedings. Kill Rates. IPX. Review Proceedings. Insights and Lessons. Trial Timeline. What's Next?

1. 1
Stats and Insights From 6 Months of Review Proceedings
Advanced Practice Under the American Invents Act (AIA)
Brad Pedersen
April 11, 2013
Post Issuance Proceedings
Kill Rates
IPX
Review Proceedings
Insights and Lessons
Trial Timeline
What’s Next

2. © 2013 Patterson Thuente Pedersen, P.A., May be distributed with attribution - www.ptslaw.com
DISCLAIMER: This presentation and any information contained herein are intended for educational and
informational purposes only and should not be construed as legal advice.
Advanced Practice
under the
America Invent Act
Brad D. Pedersen
April 11, 2013
Stats and Insights From
6 Months of Review Proceedings

3. Federal
Circuit
Central Reexamination Unit
(CRU)
Examination
Corps
Applicant Ex Parte Appeal
USPTO
Inter Partes Review
(IPR)
Trial
Division
Ex Parte
Appeal
PTAB
Patent Owner
or 3rd Party
Covered Business Method
(CBM)
Ex Partes Review
(EPX)
Post Grant Review
(PGR)
Derivations and
Interferences
Post Issuance Proceedings under the AIA
3rd Party

4. Post Issuance Proceedings under the AIA
Five Different Regimes and Three Different Standards
Ex Parte
Reexam
and Older
Inter Partes
Reexams
(EPX/IPX)
Standard
SNQ
plus IPX only
post Nov
1999
IPX Filed
before
9/16/2011
Cutover
Inter Partes
Reexams
(IPX)
Standard
RLP
plus post
Nov 1999
Filed
between
9/16/11
and
9/16/12
New Inter
Partes
Reviews
(IPR)
Standard
RLP
for
All patents
Filed after
9/16/12
and, if PGR,
After 9 mos.
1st Window
New Bus
Method
Patent
Review
(CBM)
Standard
MLPTN
plus
Defendant*
Filed after
9/16/12
but
Before 9
mos.
1st Window
New Post
Grant
Review
(PGR)
Standard
MLPTN
For
FTFG patent
Filed after
3/16/13
but
Before 9
mos.
1st Window
4

5. 5
EPX IPX IPR PGR CBM
Threshold
& Pleading
• 35 USC §303(a):
Substantial new
question of
patentability (SNQ)
•Reasonable likelihood
of prevailing (RLP)
•SNQ continues to
apply to pre-9/16/11
requests
• 35 USC §314(a): RLP
• 35 USC §315(a): Has
not “filed” a civil action
challenging validity
• 35 USC §324(a):“More likely
than not” (MLTN) that at least 1
claim is unpatentable
• §325(a): Must not have filed a
civil action challenging validity
• SEC. 18(a)(1)(B) : must be
sued or charged with
infringement
• Otherwise same as PGR
Estoppel:
•Civil actions
•ITC
•PTO
• None 35 USC §315(c) (pre-
AIA): “Raised or could
have raised”
Applies to civil actions,
not ITC
Also not PTO
• 35 USC §315(e)
• “Raised or reasonably
could have raised”
(RORCHR)
• May not “assert” issue
• Final written decision
• Civil actions, ITC & PTO
• 35 USC §325(e)
• RORCHR
• May not “assert” issue
• Final written decision
• Civil actions ITC & PTO
• SEC. 18(a)(1)(D)
• Any ground “raised” (not
RORCHR)
• Otherwise same as PGR
Patents
Covered
All Filed Post Nov 1999 All patents Only FTFG patent issued under
the AIA
• SEC. 18(a)(1)(A) & (d)
• “Covered business
method patents”
• Not “technological
inventions”
Scope, Grounds,
Bases
• 35 USC §§302
and 301: Patents
and printed
publications, plus
statement by
Owner on scope of
claims
• 35 USC §§311(a)
and 301 (pre-AIA):
Patents and printed
publications
• 35 USC §311(b):
Patents or printed
publications
• 35 USC §312(a)(3)(B):
Can be supported by
expert opinions,
affidavits, etc.
• 35 USC §321(b): Issues relating
to invalidity under §282(b)(2) or
(3)
• 35 USC §324(b): Novel or
unsettled question important to
other patents or patent
applications (does not require
MLTN)
•Same as PGR
When • Any time • No longer available • 35 USC §311(c)
• if PGR, After later of:
• 9 months after
issuance; or
• PGR is terminated
• 35 USC §321(c): ≤9 months
after issuance (or reissuance)
• 35 USC §325(f): No challenge
to non-broadened reissue claims
after original 9-month PGR period
• SEC. 18(a)(1)(B)
• Any time after suit or
charge of infringement
5
Post Issuance Proceedings under the AIA
Comparisons of the Different Regimes

6. IPX Kill Rates
6
At least one
claim survived
54%
All claims
cancelled
46%

7. Why Replace IPX Proceedings?
7
• Too Long
– Average of 5+ years from IPX
filing to BPAI decision
• Too Little Input
– CRU prohibited oral
communications with CRU
Examiners
• Too Complex/Uncertain
– Many issues had to be
petitioned, not appealed
• Too Likely to be Reversed
– 50% Reversal on appeal to BPAI

8. 8
The New Review Proceedings under the AIA
Totals for IPRs and CBMs Thru 4/5/13
0
50
100
150
200
250
IPRs CBMs PGRs
Total Filings
# of Unique Patents
# of Unique Fights

9. 9
Review Proceedings under the AIA
Monthly Filings – First 6 Months
0
5
10
15
20
25
30
35
40
Sept Oct Nov Dec Jan Feb Mar
Total # of Filings
# of New Fights
IPR Filings by Month
0
1
2
3
4
5
6
7
8
9
Sept Oct Nov Dec Jan Feb Mar
Total # of Filings
# of New Fights
CBM Filings by Month

10. 10
Review Proceedings under the AIA
Review Petition Statistics – Most Filings by Petitioners
0
2
4
6
8
10
12
Oracle (L) Liberty
Mutual (L)
Corning (L) Veeam
Software
(M)
Chi Mei
Innolux (L)
Atrium
Medical
(M)
EMC (L) Research
In Motion
(L)
ZTE (L) Dominion
Dealer
Solutions
(M)

11. 11
Review Proceedings under the AIA
Review Petition Statistics – Most Filings on Owners
0
5
10
15
20
25

12. 12
Review Proceedings under the AIA
IPR Petition Statistics – Tech Center Distribution
0
5
10
15
20
25
30
35
40

13. 13
Review Proceedings under the AIA
IPR Petition Statistics – First 6 Months
At least 1 related
case
54%
Standalone
46%
Single Reviews vs.
Multiple Reviews
No Copending
Litigation
16%
Copending
litigation
84%
Reviews with
Copending Litigation

14. 14
0
1
2
3
4
5
6
7
102 Grounds 103 Grounds
Average Grounds
Asserted per IPR
Review Proceedings under the AIA
IPR Petition Statistics – First 6 Months
59%
41%
Number of
Claims contested
Some claims
All claims

15. 15
Review Proceedings under the AIA
IPR Petition Statistics – Makeup of Petitioners & Owners
0
10
20
30
40
50
60
70
80
0
20
40
60
80
100
120
140
Patent Owners by TypePetitioners by Type

16. 16
Review Proceedings under the AIA
IPR Petition Statistics – Petitioner vs. Owner
Large Entity vs.
0
10
20
30
40
50
60
0
5
10
15
20
25
Medium Entity vs.

17. 17
Review Proceedings under the AIA
Trial Statistics for IPRs
0
5
10
15
20
25
30
35
40
IPRs
Instituted
IPRs
Dismissed
IPRs Denied IPRs Settled
IPRs Instituted
IPRs Dismissed
IPRs Denied
IPRs Settled
IPRs Pending

18. 18
Review Proceedings under the AIA
Trial Statistics for CBMs
0
2
4
6
8
10
12
14
CBMs
Instituted
CBMs
Dismissed
CBM's
Denied
CBMs
Settled
CBMs Instituted
CBMs Dismissed
CBM's Denied
CBMs Settled
CBMs Pending

19. 19
Review Proceedings under the AIA
Trial Statistics for Successful Grounds in IPRs
48%
52%
Overall granted review grounds
Granted
Denied
39%
61%
Successful 102 grounds
Granted
Denied
49%51%
Successful 103 grounds
Granted
Denied

20. 20
Insights and Lessons So Far
Representation in Review Proceedings
• Pro Hoc Vice
– Most request have been granted
– Keys are proof of competence and familiarity with case and rules, and
no adverse issues for counsel
• Pro Se
– Example of a Motion for Mandatory Withdrawal of Counsel, IPR2013-
00010 (Paper 25)
– Examples of Order Denying Withdrawal for lack of proof of instruction
from proper party, IPR2013-00010 (Paper 27)
• Protective Orders and Motions to Seal
– Example of Protective Order, CBM2012-00001 (Exhibit 2004)
– Example of Order to Seal, IPR2012-00001 (Paper 33)

21. 21
Insights and Lessons So Far
Preliminary Procedural Matters
• Mandatory Notices
– Owner needs to identify counsel and file the Mandatory Notice
identifying counsel, co-ending litigation and real parties-in-interest
• Preliminary Patent Owner Responses
– About 75% of Owners file Preliminary Responses
– Opportunity to argue 315 Bar Issues
– Also provides opportunity to argue claim construction issue
– Can make prior art arguments, but can’t introduce declarations
– Waiving Preliminary Response speeds up Trial Order by 1 month
• No Ex Parte Contact with PTAB
– Order admonishing ex parte contact, IPR2012-00035 (Paper 24,28)

22. 22
Insights and Lessons So Far
Preliminary Procedural Matters
• Stays of Patent Office matters
– General principal does not favor stays, but orders are more inclined to
grant stays of co-pending matters
– Example of stay of co-pending reexams, IPR2013-00004 (Paper 11)
– There have been some cases where no stay was granted for
co-pending applications, IPR2013-00083 (Paper 12)
• Stays of District Court litigation
– Stays are more likely to be granted than in IPX cases
– Example of stay after trial has been instituted, Capriole v LaRose, 12-cv-
2346 (MD Fla)
– Example of stay even before trial has been instituted, 2012 WL
7170593

23. 23
Insights and Lessons So Far
Preliminary Procedural Matters
• Additional Discovery Motions
– Test is whether such discovery is “in the interest of justice”, 35 USC
316(a)(5), 37 CFR 42.51(b)(2)(i).
– Five Factors for analysis, IPR2012-00001 (Paper 20)
• More than a Possibility and Mere Allegation
• Can’t seek Litigation Positions or Underlying Basis of Argument
• No ability to Generate by Other Means
• Easily Understandable Instructions
• Not Overly Burdensome
– But so far, no such motions have been granted
• Correcting Filings
– Refiling to correct typos allowed, IPR2013-00080 (Paper 16)

24. 24
Insights and Lessons So Far
Evidence and Proofs
• Internet-based Evidence
– Standards for establishing authentication of Internet-based evidence,
IPR2012-00020 (Paper 14)
– Should not include challenge in a Preliminary Response
– Must use a motion to challenge authenticity of evidence, and
authorization for that motion must be sought in advance
– Otherwise challenge can be mad within 10 days of institution of trial
• Inherency and Incorporation by Reference
– Test is whether teaching is inherent in a reference
– Test for whether incorporation by reference is effective in a prior art
reference, IPR2012-00027 (Paper 14)

25. 25
Insights and Lessons So Far
Section 315 Statutory Bars
• 315(a) – Declaratory Judgment
– Counterclaim after DJ does not bar, IPR2012-00022 (Paper 20)
• 315(b) – 1 Year Limit for Service
– Voluntary dismissal restarts the clock, IPR2012-00004 (Paper 18)
– Waiver of service under FRCP Rule 4(d) isn’t proof of service
– Served means formally served, IPR2013-00010 (Paper 21)
– 2nd IPR may be filed after 1 year with joinder, IPR2013-00109 (Paper 7,9)
• 315(b) – Real Party in Interest
– No proof of “same party” in M&A, IPR2013-00028 (Paper 14)
– Existence of co-defendants in litigation does not establish privity
– Arguments on co-defendant privity ignored, IPR2013-00026
– Test seems to be control/funding of review proceeding
– Uncertain whether there can be any estoppel-based privity

26. 26
Insights and Lessons So Far
Example Rejections
• Section 101
– Test for Section 101, CBM2012-00001 (Paper 15)
• Section 102
– Claim constructions are key to anticipation rejections
– Anticipation denied for 3 references individually, but IPR instituted for
obviousness of 3 references combined, IPR2013-00014 (Paper 12)
• Section 103
– Trial instituted for obviousness for chemical claims over two references
combined, IPR2013-00024 (Paper 16)
– Instructive analysis for challenging range claims, IPR2012-00005 (Paper
13)

27. 27
Insights and Lessons So Far
What Not to Do
• Ignore the Rules
– Review Proceedings are Rule-Bound – Study and Know 37 CFR Part 42
• Failure to Launch
– What not to do in a Petition, IPR2012-00041 (Paper 16)
• Failure to Explain
– Explanation of Proposed Grounds is required, IPR2013-00005 (Paper 19)
• Reviews are not Reexams
– Filing Dismissed for not following the Rules, IPR2013-00105 (Notice 3)
• Trying to Reserve
– No reservations of unspecified grounds, IPR2013-00073 (Notice 6)
• Substitute Exhibits Not Allowed
– While typos might be correctable, substitute exhibits are not permitted,
IPR2013-00083 (Paper 11)

28. Review Proceedings Trial Timeline
28

29. 29
What’s Next
Initial Thoughts on Trials
• Think Ahead
– Plan out and be prepared for all of the motion practice you may need
• Owners Need to Plan for Claim Substitutions
– Claim amendments are going to be only by “substitution”
• Watch for the Webcast of the 1st Oral Hearing
– The expedited oral hearing for Versata v. SAP is scheduled for April 17
and, assuming no further objections, is expected to be webcast,
CBM2012-00001 (Paper 45)
• Watch for the Lawsuit Challenging USPTO Rules for the
CBM Trials
– In addition to the expedited oral hearing, Versata has filed a lawsuit in
ED Va challenging the CBM rules under various provisions of the APA.

30. 30
Working with PRPS

31. Thank You!
About Brad Pedersen
Brad Pedersen is a patent attorney with more than 25 years of experience in patent law, engineering,
business and entrepreneurship. He is a partner and the chair of the Patent Practice group at Patterson
Thuente Pedersen, P.A., an intellectual property law firm in Minneapolis, Minnesota.
Brad is one of the more knowledgeable IP attorneys in the U.S. when it comes to the patent reform and
the AIA. Since it was first introduced in 2005, he has actively followed the developments and debate
surrounding patent reform at the agency, legislative and judicial levels. He educates clients and colleagues
by writing and presenting on the imminent changes and strategies for dealing with the reforms.
A special thanks to Justin Woo, Jameelah Haadee, and Michelle Arcand for their invaluable help on these
materials.
Brad can be reached at pedersen@ptslaw.com or (612) 349.5774
About Patterson Thuente IP
Patterson Thuente Pedersen, P.A. helps creative and inventive clients worldwide protect, and profit from,
their ideas. Practicing in the areas of patents, trademark, copyright, trade secrets, IP litigation,
international IP protection, licensing and post-grant proceedings, the firm’s attorneys excel at finding
strategic solutions to complex intellectual property matters.
Visit us online at www.ptslaw.com.
31