Board Tells Bass to “Go Fish”

Posted by Nathan Speed on Aug 25, 2015

In the much-anticipated first Board decision to address the merits of an IPR petition filed by the Coalition for Affordable Drugs and Kyle Bass, the Board yesterday denied institution in IPR2015-00720. The reason for the denial was simpler than some of the arguments advanced by the patent owner, and serves as a reminder to petitioners of their burden to demonstrate that relied upon references are prior art.

In its preliminary response, the patent owner, Acorda Therapeutics, raised numerous challenges to the Coalition’s petition. Among those challenges, Acorda argued that the petition did not properly identify all real parties-in-interest (RPIs) because it did not identify individual investors in the hedge funds that Kyle Bass manages and which funded the petition. Acorda also argued that the Board should exercise its discretion under 35 U.S.C. § 314 not to institute an IPR proceeding because the Coalition allegedly filed the petition for an improper purpose, namely manipulating financial markets for monetary gain.

Although much media attention was given to these two arguments in the patent owner’s preliminary response, the Board denied the Coalition’s petition for a much simpler reason: the petition failed to demonstrate that the references upon which it relied qualified as prior art printed publications. In its petition, the Coalition advanced three grounds of unpatentability under 35 U.S.C. § 103(a). All three grounds relied upon academic posters that the Coalition alleged were prior art printed publications. To support its allegation, the Coalition relied primarily on the fact that the applicants identified the posters in an Information Disclosure Statement (IDS) which described the posters as having been “presented.”

In its order denying institution, the Board held that the Coalition had not established that the posters qualified as printed publications. With respect to the fact that the IDS identified the posters, the Board held that the submission of an IDS does not constitute an admission that a cited reference is material prior art. The Board also found that whether a reference such as an academic poster is a printed publication requires a case-by-case inquiry into the facts and circumstances surrounding the reference’s disclosure to members of the public. The Board then held that the Coalition’s petition failed to identify sufficient facts to establish that the posters were displayed to the public in a manner that qualified them as printed publications. For example, the petition failed to explain how long the posters were presented at a scientific meeting or identify the expertise of those who attended the meeting.

The Board’s decision is yet another reminder that petitioners bear the burden to demonstrate that relied upon references are prior art and should submit sufficient evidence to qualify a reference as prior art, especially where there is likely to be a dispute over the reference’s status. For close cases, petitioners should consider submitting declarations or other forms of evidence—not merely attorney argument—to bolster the reference’s status as prior art.

For those waiting to see whether the Board will ultimately deny the Coalition’s numerous IPR petitions on RPI, improper purpose or abuse of process grounds, the wait continues. The next Board decision on a Coalition IPR is scheduled to issue in mid-October.

The Board issued a similar order denying institution in related IPR2015-00817, which the Coalition has filed against a different Acorda patent.

Topics: Kyle Bass

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