Federal Circuit Shifts Burden of Proof in Patent Challenges
Who'd have thought an automatic swimming pool cleaner would make such a splash on patent law?
But such is the case in Aqua Products, Inc. v. Matal after a decision by the U.S. Court of Appeals for the Federal Circuit. Divided on the core question of a patent owner's ability to amend claims, the appeals court issued what it called a "narrow" opinion.
The justices said a petitioner in an inter parties review has the burden to prove unpatentability in amended claims. That changes everything.
Previously, Federal Circuit panels placed the burden to demonstrate patentability on patent owners. The en banc panel, in a 148-page decision with five separate opinions, shifted the burden to patent challengers under 35 U.S.C. §316(e).
"Upon review of the statutory scheme, we believe that § 316(e) unambiguously requires the petitioner to prove all propositions of unpatentability, including for amended claims," Judge Kathleen O'Malley wrote, joined by seven other jurists.
O'Malley said it was a narrow ruling because the judges could not agree about the judgment or rationale on certain issues in the case. The panel tried, but after 10 months of deliberations since oral arguments, they couldn't do it.
"Obviously, much more detailed analysis will be required to parse this decision in the coming days and weeks," IP Watchdog reported.
More to Come
While the parties, practitioners, and scholars mull over the decision, the Federal Circuit gave marching orders to the Patent Appeals Board. First, the appeals court said the board's decision was vacated and remanded.
The board had denied Aqua Product's motion to amend claims during an IPR, and a three-judge panel of the Federal Circuit had affirmed. The board must now assess the patentability of the substituted claims without placing the burden on the patent owner.
Also, the court said it was overruling any inconsistent decisions, including four other cases involving Microsoft, Prolitec, Synopsis and Nike dating back to 2015. Plus, the judges said their decision should apply to all cases "unless and until" the Director of the Patent and Trademark Office engages in notice and comment rulemaking.
In the meantime, the en banc panel said the statute is ambiguous and the court is not deferring to the PTO's interpretation under Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc.
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