Two recent decisions from the Federal Circuit are defining the boundaries of elaborating on arguments after institution of inter partes review (IPR).  Typically, petitioners “may not submit new evidence or argument in reply that it could have presented earlier, e.g., to make out a prima facie case of unpatentability.” U.S. Patent Trial and Appeal Board, Consolidated Trial Practice Guide 73 (Nov. 2019).  However, a petitioner is allowed to “respond to arguments raised in the corresponding opposition patent owner preliminary response, or patent owner response.” 37 C.F.R. § 42.23(b).  The question taken up by the Federal Circuit in these two cases is whether or not such a response may contain claim construction or motivation to combine arguments asserted for the first time in a petitioner’s reply to a patent owner’s response that elaborate on previous arguments, without violating the prohibition on new arguments.  These two cases do not obviate the prohibition on new arguments.  Rather, they clarify that a petitioner’s right to “respond to arguments raised in the corresponding opposition, patent owner preliminary response, patent owner response, or decision on institution” includes the ability to elaborate on claim construction or motivation to combine arguments without violating the prohibition on new arguments.  37 C.F.R. § 42.23(b).

The Cases

In Axonics, Inc., v. Medtronic, Inc., the Federal Circuit addressed the question of whether Petitioner may present arguments and evidence in their reply that elaborate on a new claim construction presented for the first time in the patent owner response. On August 7^th, 2023, the Federal Circuit determined that the Board must afford Petitioner “a reasonable opportunity to present argument and evidence under” a new claim construction as long as those arguments do not rely on new prior art. Axonics, Inc., v. Medtronic, Inc., 75 F.4th 1374, 1383 (Fed. Cir. 2023).  The Federal Circuit decided to “leave for another day the question of whether, when presented with a new claim construction, a petitioner can rely in its reply on new embodiments from the prior art references that were relied on in the petition.”  Id.

Similarly, in Rembrandt Diagnostics, LP, v. Alere, Inc., the Federal Circuit addressed the question of whether Petitioner may present motivation to combine arguments in their reply to assertions made in the patent owner response which elaborate on arguments made in the petition.  On August 11^th, 2023, the Federal Circuit again determined that the Board should consider reply arguments that “involve[] the same ‘legal ground’ based on ‘the same prior art reference[s]’.” Rembrandt Diagnostics, LP v. Alere, Inc., 76 F.4th 1376, 1385 (Fed. Cir. 2023) (quoting Apple Inc. v. Andrea Electronics Corp., 949 F.3d 697, 706 (Fed. Cir. 2020)).

Both of these decisions support a petitioner’s ability to respond to new arguments raised in the patent owner response without violating the prohibition on new arguments.  Both cases consistently set at least one boundary: petitioners may not rely on new prior art, regardless of whether it is responsive to arguments made in patent owner response.  However, the decisions leaves room for argument, on a case-by-case basis, as to whether an elaboration on an argument in a petitioner’s reply is sufficiently connected to arguments previously made in the petition. 

Defining the Bounds of Elaborative Arguments

One clear takeaway from both Axonics and Rembrandt is that any elaborative arguments related to either claim construction or motivation to combine must rely on the same prior art references identified in the petition and may not rely on any new prior art references.  Axonics at 1383; Rembrandt at 1385.  Additionally, the elaborative arguments must have “a nexus” and be “responsive” to Patent Owner’s prior argument, as well as “elaborate[] on the…argument [Petitioner] made in its petition” in order to “not constitute new theories.”  Rembrandt at 1385.  After Axonics and Rembrandt, some nuance remains in determining whether a given argument is “related” to the arguments in the petition.

For example, in Rembrandt, Patent Owner argued in its patent owner response that there was insufficient motivation to combine the reference.  Id. at 1384.  In its reply, Petitioner argued that there would have been a motivation to combine the prior art references based on “cost and time savings.” Id. at 1385.  This argument represented an elaboration on the original motion to combine argument in the petition which had been based on improved efficiency.  Id. Although “cost and time savings” had not been mentioned anywhere in the petition, Petitioner argued in its reply that these represented a form of improved efficiency.  Id. The court agreed with this characterization, holding that Petitioner’s “cost and time savings” motivation “expands on and is a fair extension of [a] previously raised efficiency argument.” Id.at 1385.

Practitioners should note the potential utility of sufficiently reciting the conceptual benefits of a combination, such as “improved efficiency,” when drafting a petition.  Not only will these arguments support institution of the petition but may also provide useful hooks for further elaborating on arguments as the IPR proceeds.

Expert Declarations

A second practice tip highlighted by these two cases is the potentially expanded availability of supplemental expert declaration submissions, as well as a reminder of their importance.  In Axonics, Petitioner submitted a supplemental expert declaration with its reply in support of its claim construction argument elaboration.  In contrast, Patent Owner’s sur-reply restated the argument from its patent owner response without seeking leave to submit its own supplemental expert declaration.  Axonics at 1385.  Although “declarations are not ‘typically’ permitted with sur-replies,” the court is “confident that in circumstances such these, the Board will allow an appropriate opportunity for a patent owner to submit evidence with a sur-reply.” Id. This indicates a potential expansion of a patent owner’s ability to a submit supplemental expert declarations in support of a sur-reply when a petitioner elaborates on their arguments in their reply.  Therefore, a patent owner should at least request leave to submit a supplemental expert report.

The Rembrandt decision provides highlights the importance of requesting leave to submit a supplemental expert declaration in cases of elaborative arguments.  In this case, Petitioner filed an expert declaration with its reply, whereas Patent Owner did not file an accompanying expert declaration with its response or sur-reply, nor did it request leave to do so. Rembrandt at 1381.  Therefore, after deciding to consider Petitioner’s elaborated arguments, the Board was left with “unrebutted testimony support[ing] that a skilled artisan would have modified” the references in the manner proposed by Petitioner. Rembrandt at 1382. On Appeal Patent Owner argued that “there is insufficient evidentiary support” for the Board to have found for Petitioner.  However, because there was “unrebutted expert testimony, support[ing] the Board’s factual findings,” the Federal Circuit found this argument to be unpersuasive.  Rembrandt at 1382, 1386.

Takeaways

In light of these two recent decisions, there are two key things practitioners should keep in mind to bolster their ability to elaborate on arguments after IPR institution and prevail. First, petitioners should remember to describe both the broad and narrow aspects of their motivation to combine arguments in the petition.  As demonstrated by Rembrandt, description of a broad conceptional argument can be an essential hook for further elaborating on arguments in a later reply.  Second, supplemental expert declarations supporting both claim construction, and motivation to combine arguments should be submitted, or at least leave to submit should be requested, for any applicable reply or sur-reply to ensure the Board does not rely on unrebutted testimony from the opposing party.

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