Declarations can play a critical role in an Inter Partes Review (“IPR”) proceeding. To date, most IPR petitions filed with the Patent Trial and Appeal Board (“PTAB”) have included a supporting declaration. Further, the PTAB often relies heavily on such declarations in deciding IPR petitions.
Although IPR proceedings are a relatively new game in town, and the PTAB seems to still be tweaking the “house rules” in some respects, it is already clear from the IPR decisions issued so far that a properly supported factual declaration can increase the odds of playing a winning hand before the PTAB. In contrast, a deficient evidentiary declaration, consisting of unsupported legal conclusions, could help an IPR to “go bust” unnecessarily.
The PTAB’s recent decision in Handi Quilter, Inc. v. Bernina International AG (IPR2013-00364, Paper No. 39, September 24, 2014) offers some good tips for IPR practitioners hoping to use a declaration to help stack the deck in their favor during an IPR.
Petitioner Handi Quilter, Inc., requested Inter Partes Review of the patentability of claims 1-34 of U.S. Patent No. 6,883,446 B2 (“the ’446 patent”), which is owned by Bernina International. The ’446 patent relates “to a method and apparatus for stitching together two or more fabric layers, as in quilting.”
Petitioner Handi Quilter, Inc., alleged that the ’446 patent was invalid because it was anticipated by Japanese Published Patent Application No. 2002/292175 to Watabe (“Watabe”), which was published on October 8, 2002 (before the earliest priority date of the ’446 patent).
The Patent Owner’s main argument in response to the Petitioner’s validity challenge was that Watabe is not prior art to the ’446 patent under 35 U.S.C. § 102(a). In particular, the Patent Owner argued that Watabe is not available as prior art since the inventor of the ’446 patent invented the subject matter of the instituted claims before Watabe was published on October 8, 2002. In an attempt to show prior invention, the Patent Owner submitted several declarations purporting to show that the inventor of the ’446 patent conceived of the invention before Watabe was published, and that the inventor exercised reasonable diligence in reducing that invention to practice.
Unfortunately, the inventor of the ’446 patent died in October 2012 and did not execute an affidavit or declaration for the IPR proceeding before his death. So, the hand dealt to the Patent Owner Bernina International was clearly limited. Nevertheless, the Patent Owner refused to “fold” on its arguments regarding prior invention and, instead, submitted a flow diagram, written in the inventor’s handwriting, showing certain features of the claimed invention.
The flow diagram bore a date of September 29, 2002 (which is before Watabe’s publication date of October 8, 2002). Ultimately, the PTAB found that the substantive content of the flow diagram did not present sufficient evidence to establish conception of the invention of the ’446 patent because it failed to show some of the claimed features. But, substantive content aside, the PTAB also found that the declarations submitted by the Patent Owner were deficient because they failed to provide sufficient evidence to independently corroborate that the flow diagram was, in fact, created on the date that it bears (i.e., September 29, 2002).
Thus, one lesson for IPR practitioners to take away from Handi Quilter, Inc. v. Bernina International is to ensure that declarations are properly “stitched” together (pun intended) with the requisite factual presentation. For example, if the facts allowed, the Patent Owner could have increased the odds of success by supplementing their declarations to include evidence to independently corroborate the date the flow diagram was created.
More generally, IPR practitioners should note that, whenever possible, declarations purporting to establish prior conception should include (1) corroborating testimony of a witness, other than the inventor, and/or (2) corroborating evidence of surrounding facts and circumstances, independent of information received from the inventor. Indeed, the Patent Owner encountered similar factual presentation deficiencies along these lines with respect to other declarations submitted by the inventor’s wife and sons in an attempt to show invention prior to Watabe.
First, the declaration by the inventor’s wife stated that the inventor had told her, prior to Watabe’s publication date of October 8, 2002, that the inventor had “conceived of a solution to the problem of achieving stitch uniformity while free motion quilting by detecting fabric movement and automatically controlling the stitch rate.” However, the PTAB found that this statement, even if it were in the form testimony from the inventor himself (instead of from the inventor’s wife), does not speak to any underlying facts, rather, it is merely a legal conclusion that conception occurred.
Second, the declaration by the inventor’s wife stated that, prior to Watabe’s publication date of October 8, 2002, the inventor had demonstrated to her sons a model that the inventor had built including aspects of the claimed invention. However, the PTAB did not give weight to such testimony since, in her declaration, the inventor’s wife did not testify to witnessing the demonstration herself.
Third, although the Patent Owner had submitted unsworn statements by the inventor’s sons, the PTAB held that such statements were not reliable corroboration evidence since they were not prepared by the sons, but were instead prepared by the inventor and the inventor’s attorney and then signed by the sons. Therefore, the PTAB held that such statements were not sufficiently independent from the inventor.
Of course, the final outcome of Handi Quilter, Inc. v. Bernina International may not have been conclusively determined by any deficiencies in the Patent Owner’s declarations, since the PTAB nevertheless found that the substantive content of the declarations failed to show prior conception of all the aspects of the claimed invention sufficient to establish that the inventor had “a definite and permanent idea of the complete and operative invention” prior to Watabe’s publication date.
That said, in hindsight, perhaps the Patent Owner could have played a better hand during the IPR proceedings by including additional testimony in the declaration by the inventor’s wife regarding the underlying facts of conception (if the facts allowed for such testimony). Moreover, the Patent Owner might have left some persuasive cards on the table by not submitting sworn statements prepared by the inventor’s sons themselves, or some other form of independent testimony about the inventor’s demonstration from someone with first-hand knowledge of it.
The bottom line is that IPR practitioners must be mindful that the PTAB is more likely to be persuaded by facts than by generalized legal conclusions and, further, that independent corroborating evidence can be crucial—especially when trying to establish prior conception. At a minimum, Handi Quilter, Inc. v. Bernina International should serve as an important reminder to IPR practitioners to incorporate the proper factual presentation in any declaration that is submitted during an IPR proceeding in order to secure the best odds of success.
Drew is a partner in the Washington, D.C. office where he is a member of the firm’s Electrical/Mechanical Patent group. Drew practices in all areas of patent law with an emphasis on preparing and prosecuting patent applications, including reexamination and reissue applications, international patent portfolio management, counseling clients on intellectual property matters, and patent litigation. He also prepares opinions in the areas of patentability, infringement and product clearance.
Drew has developed a broad range of technical expertise in areas including, but not limited to, optics, microprocessors, printing and scanning, image processing, digital recording media, automotive technologies, mobile communications, computer software and hardware, networking, green technologies, semiconductors, microlithography, thermodynamics, solid-state physics, sleep related technologies and the mechanical arts.
Drew is one of the firm’s leaders in training client legal and technical staffs to implement strategies for successful prosecution before the USPTO and to develop IP management practices that will help achieve their business objectives. Drew also devotes a significant part of his practice to training and mentoring the firm’s associates.
Drew plays an active role on the patent practice committees of several prominent IP professional organizations to stay at the forefront of the latest changes / proposed changes to U.S. patent laws and USPTO rules.
Prior to Joining Sughrue, Drew’s experience included:
Burns, Doane, Swecker & Mathis, L.L.C., Summer Associate (2002) – drafted patent applications, filed amendments and responses to office actions, drafted patent claims and conducted prior art searches.
Brooks & Kushman, P.C., Summer Associate (2001) – assisted in drafting claim construction briefs, and summary judgment briefs; coordinated large document productions; assisted in filing amendments and responses to office actions.
Asset Management Consultants, Consultant (1999-2000) – helped to implement and design innovative software and hardware technologies for managing diverse real estate holdings.
Andersen Consulting, Analyst (1998-1999) – worked on large, complex technology deployments for Fortune 500 companies in the financial services and health care industries helping them to optimize their information technology infrastructure.