Torrent Pharmaceuticals

2017: A Year of CAFC Feedback &amp; Agency Refocus With so much attention being paid to Oil States, it was easy to lose sight of many of the more noteworthy Patent Trial &amp; Appeal Board (PTAB) related decisions of 2017. Last year brought significant feedback from both the Federal Circuit and Board on a number important aspects of administrative trial practice. From important issues of appellate standing, the use of ancillary petition art, to a crack down on follow-on petitions and recycled prior art, both the Board and Federal Circuit delivered a host of critical clarifications. While a bit later than usual&hellip;below are my Top 5 PTAB Trial-related Developments of 2017.&nbsp; At #5 is a decision of interest to PTAB practitioners as well as patent prosecutors. 5.&nbsp; Ex parte McAward, Appeal 2015-006416 (PTAB Aug. 25, 2017) (Section I. B.) (here) This PTAB precedential decision makes clear that the USPTO assesses indefiniteness pursuant to the Federal Circuit&rsquo;s guidance in In re Packard, 751 f . 3d 1307, 1310 (Fed. Cir. 2014). While the PTAB&rsquo;s decision to pronounce a different standard than that expressed in Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120 (2014), was met with shock by some, this is just a restatement of the Board&rsquo;s status quo since the Packard decision. The more interesting issue looking into 2018 is whether the Court&rsquo;s reasoning in Packard is equally applicable to AIA trial proceedings. Back in 2014, the Federal Circuit determined the standard for a USPTO indefiniteness analysis in In re Packard (here). (Packard was decided while Nautilus was pending before the SCOTUS). The standard pronounced in Packard (i.e., &ldquo;[a] claim is indefinite when it contains words or phrases whose meaning is unclear.&rdquo;) is more liberal (i.e., challenger friendly) as compared to the &ldquo;reasonable certainty&rdquo; standard later enunciated in Nautilus v, Biosig Instruments Inc. In arriving at the liberalized standard for agency proceedings, the Federal Circuit distinguished between the 112(b) standards used in pre-issuance vs post-issuance disputes. When Packard issued, I questioned whether that standard could be extended to post-grant proceedings. This was because, as noted above,the Court&rsquo;s determination was grounded in patent examination practices. Since that time, and even prior to the precedential designation of McAward, the PTAB has applied Packard to AIA trials. See PGR20015-00018, Telebrands Corp. v. Tinnus Enterprises LLC. Perhaps in 2018 the Federal Circuit will revisit its Packard analysis with respect to AIA trial proceedings. At #4 is a decision that further clarified the flexibility of AIA trial proceedings with respect to the Administrative Procedure Act (APA) 4.&nbsp; Novartis v. Torrent Pharmaceuticals (here) The PTAB&rsquo;s Institution Decision in Novartis denied grounds including a prior art reference known as &ldquo;Sakai.&rdquo;&nbsp;&nbsp; The PTAB found that while Sakai showed that certain ingredients could be predictably combined in liquid form, it did not teach a solid formulation as claimed.&nbsp;&nbsp; But, other grounds were accepted for trial that addressed the solid formulation feature.&nbsp; For these grounds, Sakai was nevertheless relied upon for demonstrating the knowledge in the art as to the predictability of the combination of key ingredients.&nbsp; In the Final Written Decision (FWD) following the trial, the claims were cancelled, and the Board referenced the rationale of Sakai as supporting its conclusion. Novartis argued the Board violated the Administrative Procedure Act (APA) when it relied on Sakai in the Final Written Decision without affording Novartis proper notice and a chance to be heard.&nbsp; In essence, Novartis took the position that Sakai was effectively &ldquo;ruled out&rdquo; of the trial when the grounds including it were denied. The Court disagreed that the denied ground including Sakai somehow disqualified the reference as evidence. Coming in at #3 are two cases addressing Article III standing from PTAB appeals 3.&nbsp; Phigenix, Inc. v. ImmunoGen, Inc. (here) &mdash; Personal Audio, LLC v. Electronic Frontier Foundation (here) The Federal Circuit made clear that Article III standing is necessary for petitioners to appeal from adverse decisions in AIA trial proceedings in Phigenix. This decision followed an earlier decision, Consumer Watchdog v. Wisconsin Alumni Research Foundation (Warf) finding the same Article III standing requirement for the now defunct inter partes patent reexamination. Thus, Phigenix was expected given that differences in AIA trial proceedings and patent reexamination are inconsequential with respect to the standing debate (and in virtually all other respects).&nbsp; Left open was the question of appellee standing, this was answered in Personal Audio. Here, the Appellee, Electronic Frontier Foundation (EFF), is a non-profit organization that seeks to protect the public interest of consumers of digital technology.&nbsp; EFF sought Inter Partes Review (IPR) of Personal Audio&rsquo;s patent and was successful in securing the cancellation of the challenged patent claims.&nbsp; On appeal, the question of EFF&rsquo;s standing as appellee was raised by the Court, and additional briefing was ordered (including amicus filings). In a few short paragraphs, the Court dispensed the EFF standing issue concluding that &ldquo;with Article III satisfied as to the appellant, EFF is not constitutionally excluded from appearing in court to defend the PTAB decision in its favor.&rdquo; At # 2 is a case that is unlikely to have much impact for practitioners, but earns its spot solely for the amount of attention it garnered in 2017. 2.&nbsp; In re Aqua Products (here) Aqua Products held that it is improper for the PTAB to place the burden of persuasion on the Patentee relative to the patentability of new/amended claims. Going forward, this burden of persuasion will rest with Petitioners (as it does for originally challenged claims 35 USC &sect; 316(e)). While the Court did not affirmatively hold that the burden rests with petitioners, and left it open for the Board to perhaps alter its rules to push the burden back on Patent Owners; I would not expect that to happen.&nbsp; (Recent speculation on this potential change stems from a petition for rehearing of Bosch Auto. Serv. Sol&rsquo;ns, LLC v. Matal, 878 F.3d 1027 (Fed. Cir., Dec. 22, 2017). However this clarification was likely sought to ensure that the agency&rsquo;s decisions prior to Aqua would continue to be vacated rather than mistakenly reversed.) As I have pointed out repeatedly, amendment is almost never an option for patentees at the PTAB.&nbsp; As such, I do not expect that this decision will have much of an impact in 2018. The #1 case for PTAB practitioners in 2017 came from the Board itself, and was part of a significant push to refocus petition practice away from &ldquo;follow-on&rdquo; petitions as well as recycled art (325(d)). 1.&nbsp; General Plastic Industrial Co., Ltd. v. Canon Kabushiki Kaisha, Case IPR2016-01357 (PTAB Sept. 6, 2017) (Paper 19), Section II.B.4.i.(here) This expanded panel decision explains that applying factors to evaluate the equities of permitting follow-on petitions in AIA proceedings is a proper exercise of the Board&rsquo;s discretion under 35 U.S.C. &sect; 314 and provides a non-exhaustive list of factors that the Board considers in evaluating follow-on petitions. 1. Whether the same petitioner previously filed a petition directed to the same claims of the same patent; 2. Whether at the time of filing of the first petition the petitioner knew of the prior art asserted in the second petition or should have known of it; 3. Whether at the time of filing of the second petition the petitioner already received the patent owner&rsquo;s preliminary response to the first petition or received the Board&rsquo;s decision on whether to institute review in the first petition; 4. The length of time that elapsed between the time the petitioner learned of the prior art asserted in the second petition and the filing of the second petition; 5. Whether the petitioner provides adequate explanation for the time elapsed between the filings of multiple petitions directed to the same claims of the same patent; 6. The finite resources of the Board; and 7. The requirement under 35 U.S.C. &sect; 316(a)(11) to issue a final determination not later than 1 year after the date on which the Director notices institution of review. General Plastics should not be confused with questions under 35 U.S.C. &sect; 325(d).&nbsp; The Board designated a number of decisions on 325(d) informative/precedential in 2017. These case at least deserve honorable mention on the 2017 list Honorable mentions: Unified Patents, Inc. v. Berman, Case IPR2016-01571 (PTAB Dec. 14, 2016) (Paper 10) Hospira, Inc. v. Genentech, Inc., Case IPR2017-00739 (PTAB July 27, 2017) (Paper 16) Cultec, Inc. v. Stormtech LLC, Case IPR2017-00777 (PTAB Aug. 22, 2017) (Paper 7) Scott A. McKeown is an author of the Patents Post Grant.

2017: A Year of CAFC Feedback &amp; Agency Refocus

	With so much attention being paid to <a href="https://www.patentspostgrant.com/ptab-challenges-fall-flat/" text="https://www.patentspostgrant.com/ptab-challenges-fall-flat/">Oil</a><a href="https://www.patentspostgrant.com/ptab-challenges-fall-flat/" text="https://www.patentspostgrant.com/ptab-challenges-fall-flat/"> States</a>, it was easy to lose sight of many of the more noteworthy Patent Trial &amp; Appeal Board (PTAB) related decisions of 2017. Last year brought significant feedback from both the Federal Circuit and Board on a number important aspects of administrative trial practice. From important issues of appellate standing, the use of ancillary petition art, to a crack down on follow-on petitions and recycled prior art, both the Board and Federal Circuit delivered a host of critical clarifications.

	While a bit <a href="https://www.patentspostgrant.com/top-5-ptab-decisions-of-2016/" text="https://www.patentspostgrant.com/top-5-ptab-decisions-of-2016/">later than usual</a>&hellip;below are my Top 5 PTAB Trial-related Developments of 2017.&nbsp;

	At #5 is a decision of interest to PTAB practitioners as well as patent prosecutors.

	5.&nbsp; Ex parte McAward, Appeal 2015-006416 (PTAB Aug. 25, 2017) (Section I. B.) (<a href="https://www.patentspostgrant.com/wp-content/uploads/sites/34/2017/09/Ex-parte-McAward-2017_08_25.pdf" text="https://www.patentspostgrant.com/wp-content/uploads/sites/34/2017/09/Ex-parte-McAward-2017_08_25.pdf">here</a>)

	This PTAB precedential decision makes clear that the USPTO assesses indefiniteness pursuant to the Federal Circuit&rsquo;s guidance in In re Packard, 751 f . 3d 1307, 1310 (Fed. Cir. 2014).

	While the PTAB&rsquo;s decision to pronounce a different standard than that expressed in Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120 (2014), was met with shock by some, this is just a restatement of the Board&rsquo;s status quo since the Packard decision.

	The more interesting issue looking into 2018 is <a href="https://www.patentspostgrant.com/new-ptab-precedent-endorses-re-packard-long/#more-12299" text="https://www.patentspostgrant.com/new-ptab-precedent-endorses-re-packard-long/#more-12299">whether the Court&rsquo;s reasoning in Packard is equally applicable to AIA trial proceedings</a>.

	Back in 2014, the Federal Circuit determined the standard for a USPTO indefiniteness analysis in In re Packard (<a href="https://ptabpostgrant.ropesgrayblogs.com/wp-content/uploads/sites/34/2014/05/images_InrePackard.pdf" text="https://ptabpostgrant.ropesgrayblogs.com/wp-content/uploads/sites/34/2014/05/images_InrePackard.pdf">here</a>). (Packard was decided while Nautilus was pending before the SCOTUS). The standard pronounced in Packard (i.e., &ldquo;[a] claim is indefinite when it contains words or phrases whose meaning is unclear.&rdquo;) is more liberal (i.e., challenger friendly) as compared to the &ldquo;reasonable certainty&rdquo; standard later enunciated in Nautilus v, Biosig Instruments Inc.

	In arriving at the liberalized standard for agency proceedings, the Federal Circuit distinguished between the 112(b) standards used in pre-issuance vs post-issuance disputes. When Packard issued, <a href="https://www.patentspostgrant.com/cafc-sends-conflicting-messages-to-ptab/" text="https://www.patentspostgrant.com/cafc-sends-conflicting-messages-to-ptab/">I questioned whether that standard could be extended to</a> post-grant proceedings. This was because, as noted above,the Court&rsquo;s determination was grounded in patent examination practices. Since that time, and even prior to the precedential designation of McAward, the PTAB has applied Packard to AIA trials. See PGR20015-00018, Telebrands Corp. v. Tinnus Enterprises LLC.

	Perhaps in 2018 the Federal Circuit will revisit its Packard analysis with respect to AIA trial proceedings.

	At #4 is a decision that further clarified the flexibility of AIA trial proceedings with respect to the Administrative Procedure Act (APA)

	4.&nbsp; Novartis v. Torrent Pharmaceuticals (<a href="https://ptabpostgrant.ropesgrayblogs.com/wp-content/uploads/sites/34/2017/04/images_content_2014_16-1352.Opinion.4-11-2017.1.PDF" text="https://ptabpostgrant.ropesgrayblogs.com/wp-content/uploads/sites/34/2017/04/images_content_2014_16-1352.Opinion.4-11-2017.1.PDF">here</a>)

	The PTAB&rsquo;s Institution Decision in Novartis denied grounds including a prior art reference known as &ldquo;Sakai.&rdquo;&nbsp;&nbsp; The PTAB found that while Sakai showed that certain ingredients could be predictably combined in liquid form, it did not teach a solid formulation as claimed.&nbsp;&nbsp; But, other grounds were accepted for trial that addressed the solid formulation feature.&nbsp; For these grounds, Sakai was nevertheless relied upon for demonstrating the knowledge in the art as to the predictability of the combination of key ingredients.&nbsp; In the Final Written Decision (FWD) following the trial, the claims were cancelled, and the Board referenced the rationale of Sakai as supporting its conclusion.

	Novartis argued the Board violated the Administrative Procedure Act (APA) when it relied on Sakai in the Final Written Decision without affording Novartis proper notice and a chance to be heard.&nbsp; In essence, Novartis took the position that Sakai was effectively &ldquo;ruled out&rdquo; of the trial when the grounds including it were denied. <a href="https://www.patentspostgrant.com/denied-ipr-grounds-may-be-relevant-to-trial/" text="https://www.patentspostgrant.com/denied-ipr-grounds-may-be-relevant-to-trial/">The Court disagreed that the denied ground including Sakai somehow disqualified the reference as evidence</a>.

	Coming in at #3 are two cases addressing Article III standing from PTAB appeals

	3.&nbsp; Phigenix, Inc. v. ImmunoGen, Inc. (<a href="https://ptabpostgrant.ropesgrayblogs.com/wp-content/uploads/sites/34/2017/01/images_content_2014_16-1544.Opinion.1-6-2017.1.PDF" text="https://ptabpostgrant.ropesgrayblogs.com/wp-content/uploads/sites/34/2017/01/images_content_2014_16-1544.Opinion.1-6-2017.1.PDF">here</a>) &mdash; Personal Audio, LLC v. Electronic Frontier Foundation (<a href="https://ptabpostgrant.ropesgrayblogs.com/wp-content/uploads/sites/34/2017/08/images_content_16-1123.Opinion.8-3-2017.1.PDF" text="https://ptabpostgrant.ropesgrayblogs.com/wp-content/uploads/sites/34/2017/08/images_content_16-1123.Opinion.8-3-2017.1.PDF">here</a>)

	The Federal Circuit made clear that Article III standing is necessary for petitioners to appeal from adverse decisions in AIA trial proceedings in Phigenix. This decision followed an earlier decision, Consumer Watchdog v. Wisconsin Alumni Research Foundation (Warf) finding the same Article III standing requirement for the now defunct inter partes patent reexamination. Thus, Phigenix was expected given that differences in AIA trial proceedings and patent reexamination are inconsequential with respect to the standing debate (and in virtually all other respects).&nbsp; Left open was the question of appellee standing, this was answered in Personal Audio. Here, the Appellee, Electronic Frontier Foundation (EFF), is a non-profit organization that seeks to protect the public interest of consumers of digital technology.&nbsp; EFF sought Inter Partes Review (IPR) of Personal Audio&rsquo;s patent and was successful in securing the cancellation of the challenged patent claims.&nbsp; On appeal, the question of EFF&rsquo;s standing as appellee was raised by the Court, and additional briefing was ordered (including amicus filings).

	In a few short paragraphs, the Court dispensed the EFF standing issue concluding that &ldquo;with Article III satisfied as to the appellant, EFF is not constitutionally excluded from appearing in court to defend the PTAB decision in its favor.&rdquo;

	At # 2 is a case that is unlikely to have much impact for practitioners, but earns its spot solely for the amount of attention it garnered in 2017.

	2.&nbsp; In re Aqua Products (<a href="https://www.patentspostgrant.com/wp-content/uploads/sites/34/2017/10/15-1177.Opinion.9-28-2017.1-1.pdf" text="https://www.patentspostgrant.com/wp-content/uploads/sites/34/2017/10/15-1177.Opinion.9-28-2017.1-1.pdf">here</a>)

	Aqua Products held that it is improper for the PTAB to place the burden of persuasion on the Patentee relative to the patentability of new/amended claims. Going forward, this burden of persuasion will rest with Petitioners (as it does for originally challenged claims 35 USC &sect; 316(e)). While the Court did not affirmatively hold that the burden rests with petitioners, and left it open for the Board to perhaps alter its rules to push the burden back on Patent Owners; I would not expect that to happen.&nbsp; (Recent speculation on this potential change stems from a petition for rehearing of <a href="https://www.patentspostgrant.com/wp-content/uploads/sites/34/2019/01/15-1928.Opinion.12-21-2017.1.pdf" text="https://www.patentspostgrant.com/wp-content/uploads/sites/34/2019/01/15-1928.Opinion.12-21-2017.1.pdf">Bosch Auto. Serv. Sol&rsquo;ns, LLC v. </a><a href="https://www.patentspostgrant.com/wp-content/uploads/sites/34/2019/01/15-1928.Opinion.12-21-2017.1.pdf" text="https://www.patentspostgrant.com/wp-content/uploads/sites/34/2019/01/15-1928.Opinion.12-21-2017.1.pdf">Matal</a><a href="https://www.patentspostgrant.com/wp-content/uploads/sites/34/2019/01/15-1928.Opinion.12-21-2017.1.pdf" text="https://www.patentspostgrant.com/wp-content/uploads/sites/34/2019/01/15-1928.Opinion.12-21-2017.1.pdf">, 878 F.3d</a> 1027 (Fed. Cir., Dec. 22, 2017). However this clarification was likely sought to ensure that the agency&rsquo;s decisions prior to Aqua would continue to be vacated rather than mistakenly reversed.)

	As I have pointed out repeatedly, <a href="https://www.patentspostgrant.com/re-aqua-products-giant-nothing-burger/#more-12350" text="https://www.patentspostgrant.com/re-aqua-products-giant-nothing-burger/#more-12350">amendment</a><a href="https://www.patentspostgrant.com/re-aqua-products-giant-nothing-burger/#more-12350" text="https://www.patentspostgrant.com/re-aqua-products-giant-nothing-burger/#more-12350"> is almost never an option for patentees at the PTAB</a>.&nbsp; As such, I do not expect that this decision will have much of an impact in 2018.

	The #1 case for PTAB practitioners in 2017 came from the Board itself, and was part of a significant push to refocus petition practice away from &ldquo;follow-on&rdquo; petitions as well as recycled art (325(d)).

	1.&nbsp; General Plastic Industrial Co., Ltd. v. Canon Kabushiki Kaisha, Case IPR2016-01357 (PTAB Sept. 6, 2017) (Paper 19), Section II.B.4.i.(<a href="http://bit.ly/2zpey2n" text="here">here</a>)

	This expanded panel decision explains that applying factors to evaluate the equities of permitting follow-on petitions in AIA proceedings is a proper exercise of the Board&rsquo;s discretion under 35 U.S.C. &sect; 314 and provides a non-exhaustive list of factors that the Board considers in evaluating follow-on petitions.

	1. Whether the same petitioner previously filed a petition directed to the same claims of the same patent;

	2. Whether at the time of filing of the first petition the petitioner knew of the prior art asserted in the second petition or should have known of it;

	3. Whether at the time of filing of the second petition the petitioner already received the patent owner&rsquo;s preliminary response to the first petition or received the Board&rsquo;s decision on whether to institute review in the first petition;

	4. The length of time that elapsed between the time the petitioner learned of the prior art asserted in the second petition and the filing of the second petition;

	5. Whether the petitioner provides adequate explanation for the time elapsed between the filings of multiple petitions directed to the same claims of the same patent;

	6. The finite resources of the Board; and

	7. The requirement under 35 U.S.C. &sect; 316(a)(11) to issue a final determination not later than 1 year after the date on which the Director notices institution of review.

	General Plastics should not be confused with questions under 35 U.S.C. &sect; 325(d).&nbsp; The Board designated a number of decisions on 325(d) informative/precedential in 2017. These case at least deserve honorable mention on the 2017 list

	Honorable mentions:

	Unified Patents, Inc. v. Berman, Case IPR2016-01571 (PTAB Dec. 14, 2016) (Paper 10)

	Hospira, Inc. v. Genentech, Inc., Case IPR2017-00739 (PTAB July 27, 2017) (Paper 16)

	Cultec, Inc. v. Stormtech LLC, Case IPR2017-00777 (PTAB Aug. 22, 2017) (Paper 7)

	Scott A. McKeown is an author of the <a href="https://www.patentspostgrant.com/" text="https://www.patentspostgrant.com/">Patents Post Grant</a>.

Top 5 PTAB Related Decisions of 2017

In a continuing battle between NPE Core Wireless and Apple (in December, Core Wireless won a $7 &lrm;million verdict in the Northern District of California), the panel affirms a judgment of non-infringement &lrm;from the E. D. of Texas, where Apple&rsquo;s iPad and iPhone were accused of infringement. Interestingly, this &lrm;is the same case that went up to the Circuit in 2014 on the denial of a motion to transfer, where a divided &lrm;panel denied a writ of mandamus over a stinging dissent by Judge Newman, who noted that the district &lrm;court &ldquo;greatly mischaracterized Apple&rsquo;s proffered evidence&rdquo; and that the writ should issue to account for &lrm;the &ldquo;extreme imbalance of convenience&rdquo; as between California and Texas. See our report on that &lrm;decision. These are the issues now being debated in the Supreme Court in the Heartland case. Perhaps it &lrm;wasn&rsquo;t so bad that Apple was forced to litigate in Texas.&lrm; In Novartis v. Torrent the Circuit rejects the Novartis contention that in invalidating a patent covering its &lrm;highly successful multiple sclerosis drug, the Board violated the Administrative Procedure Act by failing &lrm;to give Novartis an opportunity to address a particular reference.&lrm; Thanks to my colleague Karri Bradley, one of our pharmacologist Ph.D.&lrm;s, for her help with this week&rsquo;s &lrm;report.&lrm; Pete &lrm; Core Wireless Licensing v. Apple, Inc., Fed. Cir. Case 2015-2037 (April 14, 2017)&lrm; The Circuit affirms a judgment of non-infringement of a patent directed to a system for sending data &lrm;from a cell phone to the network using a selected channel. The patent in suit is one of the &lrm;&lrm;2,000 patents and applications that Core Wireless purchased from Nokia. &lrm; Cell phones can transmit data packets to a cellular network (known as an uplink) in one of two ways&mdash;&lrm;either by using a shared &ldquo;common channel,&rdquo; which carries transmissions from multiple mobile stations, or &lrm;by using a &ldquo;dedicated channel,&rdquo; which carries transmissions from a single mobile station or cell phone. &lrm;Dedicated channels permit faster and more reliable transmissions than common channels, but dedicated &lrm;channels are at a premium, as there are not enough dedicated channels to carry all cellular transmissions. &lrm;One aspect of this problem is whether the network or the cell phone should select the channel for the &lrm;uplink. In the prior art, the phone would send the network information about the data packet to be sent so &lrm;that the network could make the channel selection decision. But selection by the network wastes valuable &lrm;system resources, because it requires the phone to send a message to the network regarding the data &lrm;packet the phone wants to transmit, and then requires the network to make the channel selection &lrm;decision. &lrm; The solution provided by the patent is to have the mobile station, not the network, make the uplink &lrm;channel selection decision. Because the mobile station makes the channel selection decision, it does not &lrm;use up traffic capacity by sending the message about the data packet to the network so that the network &lrm;may select a channel. &lrm; The only claim that went to trial reads:&lrm; A mobile station connected with a cellular system, comprising means for sending uplink packet &lrm;data to the system using a selected channel, wherein the selected channel is either a common channel &lrm;&lrm;(RACH) or dedicated channel (DCH), characterized in that it also comprises: &lrm; means for receiving a threshold value of the channel selection parameter from the &lrm;system, &lrm; means for storing said threshold value of the channel selection parameter, and &lrm; means for comparing said threshold value of the channel selection parameter to a &lrm;current value of the channel selection parameter for basis of said channel selection. &lrm;At trial, Apple showed that the network, not the cell phone, is responsible for selecting which channel to &lrm;use for uplink transmissions, and that its cell phones lack the capability to select between common and &lrm;dedicated channels for packet data transfer. Core Wireless contends that under the magistrate&rsquo;s claim &lrm;construction, the cell phone need do no more than make a comparison, while Apple contends that the &lrm;phone must have the capability to select a dedicated channel when the relevant threshold conditions are &lrm;met. The problem with Core Wireless&rsquo;s argument is that the premise is incorrect: The magistrate did not &lrm;clearly reject Apple&rsquo;s position and adopt Core Wireless&rsquo;s position. Instead, the magistrate focused &lrm;primarily on whether Apple&rsquo;s control unit was a general purpose processor. Significantly, the magistrate &lrm;included in his construction references to the patent specification that indicate that channel selection can &lrm;be performed by the phone, consistent with the district court&rsquo;s discussion of the claim construction issue &lrm;in its JMOL order. &lrm; Core Wireless argued that the district court erred in its JMOL order, where it explicitly construed the &lrm;&lrm;&ldquo;means for comparing&rdquo; limitation to require that the mobile station have the capability to make channel &lrm;selections. The panel concludes that the court was correct that the claim requires a showing that the &lrm;accused phones were capable of making channel selection decisions, and that the specification, &lrm;prosecution history and extrinsic evidence all support this construction. &lrm; The panel therefore holds that a reasonable jury could find Apple&rsquo;s devices non-infringing based on that &lrm;evidence, and that the district court correctly denied Core Wireless&rsquo;s motion for JMOL. &lrm; Read the full opinion Novartis AG v. Torrent Pharmaceuticals Limited, Fed. Cir. Case 2016-1352 (April 12, 2017)&lrm; The panel rejects the Novartis contention that the Board should not have relied on an additional reference &lrm;&lrm;(Sakai) in the Final Written Decision invalidating a patent covering its billion dollar Gilenya&reg; drug used to &lrm;treat multiple sclerosis. Thus, the Circuit dismisses Novartis&rsquo;s argument that it had been denied adequate &lrm;notice, that it would have submitted a &ldquo;vastly different&rdquo; record than it did if it had known Sakai was still a &lrm;live issue, and that the Board&rsquo;s final decision therefore violated the APA. &lrm; The panel affirms PTAB findings that the claims are invalid as obvious, holding that the PTAB can rely on &lrm;references which were not the grounds for institution of an IPR for supporting a finding of obviousness. &lrm;Moreover, if trying to establish nonobviousness by presenting objective indicia, specific arguments for &lrm;each relevant claim (independent and/or dependent) should be made to help establish nexus. If particular &lrm;arguments for each claim are not made during the PTAB proceedings, such are waived and can&rsquo;t be &lrm;made on appeal.&lrm; In its IPR petition, Torrent alleged that the claims were obvious due to a combination of references &lrm;identified as Chiba and Aulton. However, Torrent also contended that some of the claims were &lrm;anticipated by Sakai, and that other claims were obvious in view of a combination of Sakai and Chiba. &lrm;The Board instituted the IPR based on the obviousness of Chiba and Aulton, and noted that Sakai &lrm;provided the motivation to combine these two references. &lrm; The panel points out that the Board did not rule out Sakai in the Institution Decision, and the Board&rsquo;s &lrm;discussion of Sakai in the Final Written Decision is not inconsistent with its review in the Institution &lrm;Decision. The panel also rejects Novartis&rsquo;s complaints of &ldquo;surprise&rdquo; and its contention that, following the &lrm;Institution Decision, the parties &ldquo;paid Sakai scant attention in subsequent proceedings.&rdquo; In fact, the &lrm;parties debated Sakai at length throughout the proceeding and in the same context that it was discussed &lrm;by the Board in the Final Written Decision. Both parties&rsquo; experts went into significant detail in their post-&lrm;institution declarations discussing Sakai and its applicability to the motivation to combine inquiry. &lrm; The panel also rejects Novartis&rsquo;s characterization of Sakai as the &ldquo;missing link&rdquo; in the Board&rsquo;s &lrm;obviousness analysis. Contrary to Novartis&rsquo;s contention, Sakai was discussed by the Board as one of &lrm;several independent grounds supporting the motivation to combine. This is not a case where Sakai &lrm;provided the linchpin of the Board&rsquo;s analysis, as Novartis contends. Moreover, had Novartis believed the &lrm;Board eliminated Sakai from the proceeding, it had various procedural mechanisms at its disposal to &lrm;respond to any perceived impropriety with Petitioners&rsquo; continued reliance on the reference. For all these &lrm;reasons, the panel finds no violation of the APA. &lrm; Read the full opinion

In a continuing battle between NPE Core Wireless and Apple (in December, Core Wireless won a $7 &lrm;million verdict in the Northern District of California), the panel affirms a judgment of non-infringement &lrm;from the E. D. of Texas, where Apple&rsquo;s iPad and iPhone were accused of infringement. Interestingly, this &lrm;is the same case that went up to the Circuit in 2014 on the denial of a motion to transfer, where a divided &lrm;panel denied a writ of mandamus over a stinging dissent by Judge Newman, who noted that the district &lrm;court &ldquo;greatly mischaracterized Apple&rsquo;s proffered evidence&rdquo; and that the writ should issue to account for &lrm;the &ldquo;extreme imbalance of convenience&rdquo; as between California and Texas. <a href="https://communications.schwabe.com/email_handler.aspx?sid=1b367642-ef85-4f9a-9efc-5b6e68d03a09&amp;redirect=http%3a%2f%2fwww.schwabe.com%2fnewsroom-publications-14682">See our report on that &lrm;decision.</a> These are the issues now being debated in the Supreme Court in the Heartland case. Perhaps it &lrm;wasn&rsquo;t so bad that Apple was forced to litigate in Texas.&lrm;

	In Novartis v. Torrent the Circuit rejects the Novartis contention that in invalidating a patent covering its &lrm;highly successful multiple sclerosis drug, the Board violated the Administrative Procedure Act by failing &lrm;to give Novartis an opportunity to address a particular reference.&lrm;

	Thanks to my colleague Karri Bradley, one of our pharmacologist Ph.D.&lrm;s, for her help with this week&rsquo;s &lrm;report.&lrm;

	Pete &lrm;

	Core Wireless Licensing v. Apple, Inc., Fed. Cir. Case 2015-2037 (April 14, 2017)&lrm;

	The Circuit affirms a judgment of non-infringement of a patent directed to a system for sending data &lrm;from a cell phone to the network using a selected channel. The patent in suit is one of the &lrm;&lrm;2,000 patents and applications that Core Wireless purchased from Nokia. &lrm;

	Cell phones can transmit data packets to a cellular network (known as an uplink) in one of two ways&mdash;&lrm;either by using a shared &ldquo;common channel,&rdquo; which carries transmissions from multiple mobile stations, or &lrm;by using a &ldquo;dedicated channel,&rdquo; which carries transmissions from a single mobile station or cell phone. &lrm;Dedicated channels permit faster and more reliable transmissions than common channels, but dedicated &lrm;channels are at a premium, as there are not enough dedicated channels to carry all cellular transmissions. &lrm;One aspect of this problem is whether the network or the cell phone should select the channel for the &lrm;uplink. In the prior art, the phone would send the network information about the data packet to be sent so &lrm;that the network could make the channel selection decision. But selection by the network wastes valuable &lrm;system resources, because it requires the phone to send a message to the network regarding the data &lrm;packet the phone wants to transmit, and then requires the network to make the channel selection &lrm;decision. &lrm;

	The solution provided by the patent is to have the mobile station, not the network, make the uplink &lrm;channel selection decision. Because the mobile station makes the channel selection decision, it does not &lrm;use up traffic capacity by sending the message about the data packet to the network so that the network &lrm;may select a channel. &lrm;

	The only claim that went to trial reads:&lrm;

	A mobile station connected with a cellular system, comprising means for sending uplink packet &lrm;data to the system using a selected channel, wherein the selected channel is either a common channel &lrm;&lrm;(RACH) or dedicated channel (DCH), characterized in that it also comprises: &lrm;

	means for receiving a threshold value of the channel selection parameter from the &lrm;system, &lrm;

	means for storing said threshold value of the channel selection parameter, and &lrm;

	means for comparing said threshold value of the channel selection parameter to a &lrm;current value of the channel selection parameter for basis of said channel selection.

	&lrm;At trial, Apple showed that the network, not the cell phone, is responsible for selecting which channel to &lrm;use for uplink transmissions, and that its cell phones lack the capability to select between common and &lrm;dedicated channels for packet data transfer. Core Wireless contends that under the magistrate&rsquo;s claim &lrm;construction, the cell phone need do no more than make a comparison, while Apple contends that the &lrm;phone must have the capability to select a dedicated channel when the relevant threshold conditions are &lrm;met. The problem with Core Wireless&rsquo;s argument is that the premise is incorrect: The magistrate did not &lrm;clearly reject Apple&rsquo;s position and adopt Core Wireless&rsquo;s position. Instead, the magistrate focused &lrm;primarily on whether Apple&rsquo;s control unit was a general purpose processor. Significantly, the magistrate &lrm;included in his construction references to the patent specification that indicate that channel selection can &lrm;be performed by the phone, consistent with the district court&rsquo;s discussion of the claim construction issue &lrm;in its JMOL order. &lrm;

	Core Wireless argued that the district court erred in its JMOL order, where it explicitly construed the &lrm;&lrm;&ldquo;means for comparing&rdquo; limitation to require that the mobile station have the capability to make channel &lrm;selections. The panel concludes that the court was correct that the claim requires a showing that the &lrm;accused phones were capable of making channel selection decisions, and that the specification, &lrm;prosecution history and extrinsic evidence all support this construction. &lrm; 
	The panel therefore holds that a reasonable jury could find Apple&rsquo;s devices non-infringing based on that &lrm;evidence, and that the district court correctly denied Core Wireless&rsquo;s motion for JMOL. &lrm;

	<a href="https://communications.schwabe.com/email_handler.aspx?sid=1b367642-ef85-4f9a-9efc-5b6e68d03a09&amp;redirect=https%3a%2f%2fcommunications.schwabe.com%2f40%2f143%2fuploads%2fcore-wireless-v-apple.pdf">Read the full opinion</a>

	 
	Novartis AG v. Torrent Pharmaceuticals Limited, Fed. Cir. Case 2016-1352 (April 12, 2017)&lrm;

	The panel rejects the Novartis contention that the Board should not have relied on an additional reference &lrm;&lrm;(Sakai) in the Final Written Decision invalidating a patent covering its billion dollar Gilenya&reg; drug used to &lrm;treat multiple sclerosis. Thus, the Circuit dismisses Novartis&rsquo;s argument that it had been denied adequate &lrm;notice, that it would have submitted a &ldquo;vastly different&rdquo; record than it did if it had known Sakai was still a &lrm;live issue, and that the Board&rsquo;s final decision therefore violated the APA. &lrm;

	The panel affirms PTAB findings that the claims are invalid as obvious, holding that the PTAB can rely on &lrm;references which were not the grounds for institution of an IPR for supporting a finding of obviousness. &lrm;Moreover, if trying to establish nonobviousness by presenting objective indicia, specific arguments for &lrm;each relevant claim (independent and/or dependent) should be made to help establish nexus. If particular &lrm;arguments for each claim are not made during the PTAB proceedings, such are waived and can&rsquo;t be &lrm;made on appeal.&lrm;

	In its IPR petition, Torrent alleged that the claims were obvious due to a combination of references &lrm;identified as Chiba and Aulton. However, Torrent also contended that some of the claims were &lrm;anticipated by Sakai, and that other claims were obvious in view of a combination of Sakai and Chiba. &lrm;The Board instituted the IPR based on the obviousness of Chiba and Aulton, and noted that Sakai &lrm;provided the motivation to combine these two references. &lrm; 
	The panel points out that the Board did not rule out Sakai in the Institution Decision, and the Board&rsquo;s &lrm;discussion of Sakai in the Final Written Decision is not inconsistent with its review in the Institution &lrm;Decision. The panel also rejects Novartis&rsquo;s complaints of &ldquo;surprise&rdquo; and its contention that, following the &lrm;Institution Decision, the parties &ldquo;paid Sakai scant attention in subsequent proceedings.&rdquo; In fact, the &lrm;parties debated Sakai at length throughout the proceeding and in the same context that it was discussed &lrm;by the Board in the Final Written Decision. Both parties&rsquo; experts went into significant detail in their post-&lrm;institution declarations discussing Sakai and its applicability to the motivation to combine inquiry. &lrm;

	The panel also rejects Novartis&rsquo;s characterization of Sakai as the &ldquo;missing link&rdquo; in the Board&rsquo;s &lrm;obviousness analysis. Contrary to Novartis&rsquo;s contention, Sakai was discussed by the Board as one of &lrm;several independent grounds supporting the motivation to combine. This is not a case where Sakai &lrm;provided the linchpin of the Board&rsquo;s analysis, as Novartis contends. Moreover, had Novartis believed the &lrm;Board eliminated Sakai from the proceeding, it had various procedural mechanisms at its disposal to &lrm;respond to any perceived impropriety with Petitioners&rsquo; continued reliance on the reference. For all these &lrm;reasons, the panel finds no violation of the APA. &lrm;

	<a href="https://communications.schwabe.com/email_handler.aspx?sid=1b367642-ef85-4f9a-9efc-5b6e68d03a09&amp;redirect=https%3a%2f%2fcommunications.schwabe.com%2f40%2f143%2fuploads%2fnovartis-v-torrent.pdf">Read the full opinion</a>