Federal Circuit Rules the Patent Trial and Appeal Board Can Consider New Evidence During AIA Review Trial
October 6 2016
On September 26, 2016, the U.S. Court of Appeals for the Federal Circuit declined to review in a unanimous en banc decision a panel Federal Circuit decision affirming that the Patent Trial and Appeal Board (the “Board”) at the Patent and Trademark Office (“USPTO”) could hear new evidence during a trial, evidence that was not cited by the Board in its decision to institute review under the America Invents Act (“AIA”). In so doing, the Federal Circuit reasoned “[t]he introduction of new evidence in the course of the trial is to be expected in inter partes review trial proceedings and, as long as the opposing party is given notice of the evidence and an opportunity to respond to it, the introduction of such evidence is perfectly permissible.”
The patents at issue in the case are U.S. Patent Nos. 7,351,410 (“the ’410 patent”) and 7,655,226 (“the ’226 patent”), both entitled “Treatment of Pompe’s Disease,” and are directed to treating Pompe’s disease with injections of human acid α-glucosidase. Pompe’s disease is a genetic disease caused by a complete or partial lack of the lysosomal enzyme acid α-glucosidase (“GAA”). In a healthy individual, GAA breaks down glycogen, a larger molecule, into glucose. A person with Pompe’s disease has reduced levels of GAA, or no GAA at all, and is unable to break down glycogen into glucose. This inability results in glycogen accumulating in the muscles of affected patients in excessive amounts. There are two forms of Pompe’s disease: early-onset and late onset. Early onset occurs in infants shortly after birth and is usually fatal before one year because excess glycogen accumulates in the muscles and causes cardiac or respiratory failure. Those with late onset develop the disease after infancy and have progressive muscle weakness and respiratory issues caused by the glycogen buildup in the muscles, but do not typically develop the severe cardiac symptoms associated with early onset.
In 2013, Biomarin, the petitioner, filed petitions requesting inter partes review of the ’410 and ’226 patents. The Board granted review on two different obviousness grounds for each challenged claim in each patent. In its final written decisions, the Board found by a preponderance of the evidence that the challenged claims of the ’410 and ’226 patents would have been obvious. In so doing, he Board cited references in its final written decisions that were not specifically included in the combinations of prior art on which the Board instituted review.
On appeal, Genzyme, the patent owner, argued that the Board violated the requirements of notice and an opportunity to respond found in the Administrative Procedure Act (“APA”). Genzyme argued that in finding that the claims at issue were unpatentable, the Board relied on “facts and legal arguments” that were not set forth in the institution decisions. Therefore, according to Genzyme, it was denied notice “of the issues to be considered by the Board and an opportunity to address the facts and legal arguments on which the Board’s patentability determination [would] rest.”
The Federal Circuit rejected this argument because the Board’s decision to institute review does not need to refer to every bit of evidence that is relied on by the Board in its final written decision. The Federal Circuit reasoned “there is no requirement, either in the Board’s regulations, in the APA, or as a matter of due process, for the institution decision to anticipate and set forth every legal or factual issue that might arise in the course of the trial.”
Moreover, the Federal Circuit found “Genzyme has not shown that the Board’s decisions rested on any factual or legal issues as to which Genzyme was denied notice or an opportunity to be heard at a meaningful point in the proceedings.” Indeed, the Federal Circuit noted that Genzyme itself referred to the disputed prior art in its patent owner responses to the petitions. Therefore, the Federal Circuit found “Genzyme had ample notice that the references were in play as potentially relevant evidence and that the Board might well address the parties’ arguments regarding those references in its final written decisions.” The Federal Circuit also noted that despite having notice of the prior art, Genzyme failed to take advantage of its procedural options to seek to exclude that evidence or further respond before the Board.
Finally, the Federal Circuit also noted the relatively limited use to which the Board put the disputed references. Specifically, the Board used the references merely to describe the state of the art; and they were not among the prior art references that the Board relied upon to establish any claim limitations. Thus, the Federal Circuit reasoned it has previously “made clear that the Board may consider a prior art reference to show the state of the art at the time of the invention, regardless of whether that reference was cited in the Board’s institution decision.”
This case serves as a warning to both petitioners and patent owners alike when faced with patent review under the AIA. For patent owners, do not expect to able to exclude evidence or arguments raised at trial after the fact simply because the exact contours of the evidence or arguments were not raised in the petitions or the Board decision to institute review. Instead, take advantage of all pro-active measures along the way, such as motions to exclude, motions seeking additional briefing, and so on. For petitioners, be careful relying too heavily on evidence or arguments not raised in the petitions or cited in the Board’s decision to institute review. Although successful here, one could argue the results may be different if patent owner had no notice of the references, did not have any opportunity to previously object, or the references had a significant substantive role in the Board’s decision, such as to establish claim limitations.