PTAB Must Give Patent Owner an Opportunity to Respond to New Assertions Raised in Petitioner's Reply: Federal Circuit | Practical Law

PTAB Must Give Patent Owner an Opportunity to Respond to New Assertions Raised in Petitioner's Reply: Federal Circuit | Practical Law

In In re: NuVasive, Inc.,the US Court of Appeals for the Federal Circuit held that the Patent Trial and Appeal Board (PTAB) violated the Administrative Procedure Act (APA) by failing to give the patent owner an opportunity to address new arguments concerning the prior art raised for the first time in the petitioner's reply in an inter partes review (IPR) proceeding.

PTAB Must Give Patent Owner an Opportunity to Respond to New Assertions Raised in Petitioner's Reply: Federal Circuit

by Practical Law Intellectual Property & Technology
Published on 14 Nov 2016 • USA (National/Federal)
In In re: NuVasive, Inc., the US Court of Appeals for the Federal Circuit held that the Patent Trial and Appeal Board (PTAB) violated the Administrative Procedure Act (APA) by failing to give the patent owner an opportunity to address new arguments concerning the prior art raised for the first time in the petitioner's reply in an inter partes review (IPR) proceeding.
On November 9, 2016, in In re: NuVasive, Inc., the US Court of Appeals for the Federal Circuit held that the Patent Trial and Appeal Board (PTAB) must give a patent owner an opportunity to address an argument concerning the disclosure of a prior art reference raised for the first time in the petitioner's reply where the argument was absent from the petition for inter partes review (IPR) ( (Fed. Cir. Nov. 9, 2016)).
NuVasive, Inc. owns U.S. Patent No. 8,187,334 (the '334 patent), which describes implants for spinal fusion surgery. Medtronic, Inc. filed two petitions for inter partes review of the '334 patent with the PTAB. The petitions, IPR 2013-00507 (IPR 507) and IPR 2013-00508 (IPR 508), challenged identical claims, except claims 16 and 17, which Medtronic challenged in IPR 508 but not IPR 507. In support of its obviousness arguments, both petitions relied on Michelson's U.S. Patent No. 5,860,973 (Michelson). Significantly, Medtronic's petition in IPR 507 discussed Figure 18 in Michelson, but Medtronic's petition in IPR 508 did not.
In both IPRs, the PTAB used Michelson and the reference's disclosure in Figure 18 to cancel all but one of the challenged claims for obviousness under 35 U.S.C. § 103. NuVasive appealed to the Federal Circuit and argued that it did not have an adequate opportunity to address Figure 18 in IPR 508 because the figure was not discussed in Medtronic's IPR 508 petition. NuVasive further argued that the PTAB's use of Figure 18 in IPR 508 violated the notice and opportunity to respond requirements of the Administrative Procedure Act (APA) (5 U.S.C. § 706).
The Federal Circuit reversed the PTAB's decision in IPR 508 and explained that the APA requires the PTAB to:
  • Timely inform the patent owner of the matters of fact and law asserted.
  • Provide all interested parties an opportunity for the submission and consideration of facts, arguments, hearings, and decisions.
  • Allow parties to submit rebuttal evidence.
The Federal Circuit held that NuVasive did not have sufficient notice or an opportunity to respond to Medtronic's assertions regarding Michelson's Figure 18 in IPR 508, noting that:
  • Medtronic's petition in IPR 508 did not cite Figure 18.
  • Although Medtronic generally cited Figure 18 in IPR 507 and the two proceedings had a consolidated hearing, the PTAB treated each IPR as a separate, distinct proceeding.
  • The PTAB's factual findings concerning Figure 18 were material to its obviousness determinations and did not merely describe the state of the art or reinforce the meaning of other prior art disclosures.
  • Permitting NuVasive to cross-examine the petitioner's expert and file observations on cross-examination did not cure the procedural defect.
The Federal Circuit therefore vacated the PTAB's cancelation of claims 16 and 17 and remanded IPR 508 for further proceedings. However, the Federal Circuit affirmed the PTAB's rulings in IPR 507 and found that NuVasive had sufficient notice of Figure 18 in that proceeding.