Blog | 05/03/2016

In re Aqua Products, Inc.: Federal Circuit Continues To Uphold PTAB Limits on Motions To Amend


Although the America Invents Act permits patent owners to file motions to amend claims in a patent under review, see e.g., 35 U.S.C. § 316(d), patentees generally have been unsuccessful in seeking amendments. The USPTO has promulgated rules that place squarely on the patent owner the burden of demonstrating that proposed substitute claims are patentable over the known prior art. Idle Free Sys., Inc. v. Bergstrom, Inc., IPR2012–00027, Paper 26, 2013 WL 5947697 (PTAB June 11, 2013). In a later decision by an expended panel, the PTAB clarified this requirement, noting that for purposes of motions to amend under 37 C.F.R. § 42.121 “known prior art” refers to:

(a) any material art in the prosecution history of the patent;

(b) any material art of record in the current proceeding,  including art asserted in grounds on which the PTAB did  not institute review; and

(c) any material art of record in any other proceeding before  the USPTO involving the patent.

See Masterimage 3D, Inc. v. Reald Inc., No. IPR2015-00040, Paper 42, 2015 WL 4383224 (PTAB Jul. 15, 2015)(informative).

In a recent case, the Federal Circuit continued its trend of deference to the UPSTO’s exercise of authority to promulgate rules implementing the AIA, and to the PTAB’s interpretation of those rules. In re Aqua Products, Inc., Case No. 2015-1177  (Fed. Cir. May 25, 2016). In Aqua Products, involving a patent for a water-propelled automatic swimming pool sweeping device, the patentee sought to amend the claims under review to add three requirements: (1) that the water jets powering the device are set to a vector to create a downward force on the front wheels (thereby holding the device to the pool surface), (2) that the wheels controlled the directional movement of the device, and (3) than the device had four wheels. The patent owner argued in its motion that the amended claims were patentable over the two references at issue in the IPR. It focused its argument on the newly-added vector limitation, mentioning the other amendments only in passing. The patent owner also noted that its embodiment of the invention was “successful,” and accused the petitioner of copying the patented design, but did not argue that either fact was an objective indicator of nonobviousness. The PTAB denied the motion to amend, concluding that the amended claims would be obvious in light of the cited references.

On appeal, the Federal Circuit affirmed. The court noted that its prior cases had generally upheld the PTAB rules regarding amendment, in part because the PTAB panels lack the capacity to examine amended claims. See Nike, Inc. v. Adidas AG, 812 F.3d 1326 (Fed. Cir. 2016); Microsoft Corp. v. Proxyconn, Inc., 789 F.3d 1292 (Fed. Cir. 2015). It concluded that those decision were controlling, and that the “panel cannot revisit the question of whether the Board may require the patentee to demonstrate the patentability of substitute claims over the art of record.”

The court also upheld the PTAB’s decision to deny the motion to amend. It agreed that the PTAB was not required to consider nonobviousness arguments based on objective indicia and on the second and third proposed new limitations because the patent owner effectively failed to raise them in the motion. It noted that “to hold otherwise would require the Board to fully reexamine the proposed claims in the first instance, effectively shifting the burden from the patentee to the Board.” Although the patent owner did mention the issues in passing, and raised them in more detail later in the proceeding, “none of the arguments appeared in the portion of the motion to amend that sought to explain why the “Substitute Claims Are Not Obvious In View of [the Prior Art].” Accordingly, the Board was under no obligation to consider them in evaluating the motion to amend.”

Finally, the court was not persuaded by the patent owner’s protests that it did its best to address the standard for amending claims considering the 15 page limit for motions then in effect. The Federal Circuit noted that, “[t]he problem here is that [the patent owner] did not ask the Board for additional pages, or any similar relief. As such, we cannot say that the Board abused its discretion by holding [it] to the then applicable page limits.” Effective May 12, 2016, the PTAB has expanded the page limit for motion to amend to 25 pages. See 37 CFR § 42.24; Amendments to the Rules of Practice for Trials Before the Patent Trial and Appeal Board, 81 Fed. Reg. 18750, 18752 (Apr. 1, 2016).

The Aqua Products cases illustrates that in crafting motions to amend in PTAB trials, patent owners must be diligent in advancing all available arguments to show that the amended claims are patentable over the prior art. Arguments mentioned only in passing, or raised in later proceedings, will not suffice.



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