Understanding the Weight and the Reach

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1 Lessons from Baxter and Fresenius: Understanding the Weight and the Reach of Post-Issuance Review by the USPTO NC CLE Presented October 7, 2013 by Adam L. Rucker 4140 Parklake Ave, Ste 600 Raleigh, NC P: F:

2 The contents of this presentation have been prepared for the sole purpose of contributing to the audience s understanding of intellectual t l property law and do not constitute t legal l advice. It is understood that each case is fact-specific and that the contents of this presentation may or may not be relevant to any particular case. The presentation of these materials does not establish an attorney-client relationship with the author or with Myers Bigel Sibley & Sajovec, PA. Any opinions presented herein are those of the author and are not necessarily representative of those of Myers Bigel Sibley & Sajovec, P.A.

3 Agenda Baxter International vs. Fresenius USA how differences in claim interpretation and evidentiary standards d affect outcomes in the USPTO and federal courts how post-issuance review can be used to snatch victory from the jaws of defeat Post-Issuance Review Opportunities

4 U.S. Patent No. 5,247, A hemodialysis machine comprising: (a) means for controlling a dialysate parameter selected from a group consisting of dialysate temperature and dialysate concentration, and means for delivering the dialysate to a dialysate compartment of a hemodialyzer; and (b) a user/machine interface operably coupled to said dialysate-deliverydelivery means, the user/machine interface comprising a touch screen adapted to display an indicium corresponding to a parameter pertinent to operation of the hemodialysis machine for performing hemodialysis and to permit the user, by touching the indicium, to cause a change in the parameter.

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16 Fresenius v. Baxter (Fed. Cir. 2009) Because Fresenius failed to demonstrate that t the structures t corresponding to certain means-plus-function claim limitations were present in the prior art, we affirm the district court's judgment that Fresenius failed to prove that claims of the '434 patent are invalid. We reverse the district court's grant of JMOL as to all other asserted claims.... Finally, we vacate the royalty y award entered by the district court and remand for further proceedings consistent with this opinion.

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19 In re Baxter (BPAI 2008) Although claims were not proven invalid in court, a lower standard of proof and the broadest reasonable interpretation standard d of claim construction ti apply at the PTO and therefore the agency is not bound by the court s determination.

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23 In re Baxter (Fed. Cir. 2012) Federal Court Plain meaning Clear and convincing evidence Presumption of validity USPTO Broadest reasonable interpretation Preponderance of the evidence

24 In re Baxter (Fed. Cir. 2012) Because the USPTO and federal courts necessarily apply different standards of proof and claim interpretation, they may quite correctly reach different conclusions as to the validity of the exact same claims. Different Standards Different Results

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27 Fresenius v. Baxter (Fed. Cir. 2013) Issue Whether Baxter s claims against Fresenius must g be dismissed because the USPTO cancelled claims

28 Fresenius v. Baxter (Fed. Cir. 2013) 35 U.S.C. 307 (a) In a reexamination proceeding under this chapter, when the time for appeal has expired or any appeal proceeding has terminated, the Director will issue and publish a certificate canceling any claim of the patent finally determined to be unpatentable, confirming any claim of the patent determined to be patentable, t and incorporating in the patent t any proposed amended or new claim determined to be patentable. (b) Any proposed p amended or new claim determined to be patentable and incorporated into a patent following a reexamination proceeding will have the same effect as that specified in section 252 for reissued patents on the right of any yperson who made, purchased, or used within the United States, or imported into the United States, anything patented by such proposed amended or new claim, or who made substantial preparation for the same, prior to issuance of a certificate under the provisions of subsection (a) of this section.

29 Fresenius v. Baxter (Fed. Cir. 2013) 35 U.S.C. 307 (a) In a reexamination proceeding under this chapter, when the time for appeal has expired or any appeal proceeding has terminated, the Director will issue and publish a certificate canceling any claim of the patent finally determined to be unpatentable, confirming any claim of the patent determined to be patentable, t and incorporating in the patent t any proposed amended or new claim determined to be patentable. (b) Any proposed p amended or new claim determined to be patentable and incorporated into a patent following a reexamination proceeding will have the same effect as that specified in section 252 for reissued patents on the right of any yperson who made, purchased, or used within the United States, or imported into the United States, anything patented by such proposed amended or new claim, or who made substantial preparation for the same, prior to issuance of a certificate under the provisions of subsection (a) of this section.

30 Fresenius v. Baxter (Fed. Cir. 2013) When a claim is canceled in a reissue proceeding, pending litigation that is based upon that claim must be dismissed.

31 Fresenius v. Baxter (Fed. Cir. 2013) When a claim is amended in a reissue proceeding, pending litigation that is based upon that claim must be dismissed unless the reissued claim is substantially identical to the original claim.

32 Fresenius v. Baxter (Fed. Cir. 2013) When a claim is amended in a reissue proceeding, the patentee cannot enforce the reissued claim against infringing activity that occurred prior to reissuance unless the reissued claims are substantially identical to the original claims.

33 Fresenius v. Baxter (Fed. Cir. 2013) In sum, under either the reissue or reexamination statute... if the original claim is cancelled or amended to cure invalidity, the patentee s cause of action is extinguished and the suit fails.

34 Fresenius v. Baxter (Fed. Cir. 2013) Baxter The subsequent cancellation of claims cannot be used to reopen a final judgment and recoup damages that have been paid to satisfy a finding of infringement. e Because the validity portion of the case was over when the Federal Circuit affirmed the district court s JMOL, the USPTO s cancellation of claims is too late.

35 Fresenius v. Baxter (Fed. Cir. 2013) Fresenius The litigation is obviously still pending. If it was over, we would not be here. So long as the litigation is pending, the court is obliged to honor the USPTO s cancellation of claims B l i h b ll d Because claims have been cancelled, Baxter no longer has a cause of action.

36 Fresenius v. Baxter (Fed. Cir. 2013) Federal Circuit [W]here the scope of relief remains to be determined, there is no final judgment binding the parties (or the court). Because the litigation is still pending, the district court must honor the USPTO s cancellation of claims

37 Fresenius v. Baxter (Fed. Cir. 2013) Baxter s problem is that it no longer has a viable cause of action in the pending case.

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39 It ain t over til it s over. Yogi Berra

40 Post-Issuance Review Opportunities Inter Partes Review Post-Grant Review Ex Parte Reexamination

41 Potential Advantages of Inter Partes Review Cost Speed Lower standards of review Finality Focus exclusively on validity

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