Who Bears the Burden in IPR? It Depends on the Argument

Posted by Stuart Duncan Smith on Oct 23, 2018

A hallmark of IPR proceedings is that the petitioner—not the patent owner—has the burden to prove that the challenged claims are unpatentable. This hallmark is statutory as section 316(e) of the American Invents Act (which created IPRs) provides that “the petitioner shall have the burden of proving a proposition of unpatentability.” And yet, a recent decision from the Federal Circuit confirms IPR nonetheless applies the traditional rule that can shift a burden to the patent owner to rebut the petitioner’s prima facie case of obviousness. Patent owners thus cannot blindly rely upon section 316(e) and, in certain circumstances, should consider submitting evidence to defend the claims.

Over the years, the Federal Circuit has emphasized that the patent owner does not have the burden to prove that its claims are patentable. For example, in In re Magnum Oil Tools International, the Court rejected the PTAB’s reasoning that, upon institution, the burden shifts to the patent owner. And as we discussed recently, Aqua Products v. Matal held that the petitioner has the burden of proving the unpatentability of new claims that the patent owner seeks to introduce during IPR via a motion to amend the patent.

Unlike those decisions, the Federal Circuit’s decision in E.I. Dupont de Nemours v. Synvina (which we also wrote about here) addressed a situation where a burden may shift to the patent owner. The challenged claims concerned a chemical reaction under certain specific conditions (e.g., temperature and pressure). The prior art disclosed the reaction and a range of conditions that encompassed the claimed conditions. Under the traditional rule, when the party challenging a patent shows that prior art discloses an overlapping range, the patent owner then has the burden to prove that the claimed values are nonetheless inventive (e.g., have unexpected properties or are critical to the invention).

The patent owner argued that the traditional rule does not apply to IPR, but the Federal Circuit disagreed. According to the Court, while a patent owner does not have the burden under section 316(e) to defend its claims other than to hold the petitioner to its own burden of persuasion, the petitioner’s burden of persuasion may be satisfied when the petitioner shows that prior art ranges included specific values recited in the challenged claims. To prevail, the patent owner must then respond.

Takeaways

Dupont confirms that the burden-shifting framework applicable to overlapping range cases applies in IPR proceedings. Going forward, patent owners in such cases cannot simply hold the petitioner to its burden of persuasion but rather must be prepared to rebut the prima facie case of obviousness with its own evidence that the claimed value is inventive.

More generally, the decision reinforces that although IPRs have existed for six years, new questions about their procedures continue to arise. This case, like the Supreme Court’s recent decision in SAS Institute v. Iancu, which reversed the PTAB’s basic procedures regarding institution, shows that parties cannot rest on their assumptions about how IPRs work.

Topics: Patent Owners, Petitioners

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This blog is intended to promote thought and debate on developing areas of the law. The opinions, commentary and characterizations of cases provided on this blog are not legal advice and do not represent the opinions of Wolf Greenfield or its clients.