Plan Now for Coming Changes to Post-Grant Amendment Practice

October 8, 2015

Edmund J. Walsh
The landscape for resolving both high-stakes and nuisance patent disputes has changed markedly since 2012, given the high rate at which patent claims have been canceled in post-grant challenges conducted by the Patent and Trademark Office (PTO). But now is not the time for complacency on the part of those who need to invalidate patents, or for despair on the part of patent owners. To the contrary, both should look out for upcoming changes in how these proceedings will be conducted and adapt their strategies now.

One of a trio of new proceedings—an inter partes review (IPR), covered business method proceeding (CBM) or post-grant review (PGR)—is considered in almost every patent litigation. These proceedings provide a fast, low-cost way to clear away bad patents. Those accused of infringement have jumped on these proceedings, using them literally thousands of times, and with favorable results. About 70 percent of petitions to institute one of these proceedings are granted. Once instituted, the Patent Trial and Appeal Board (PTAB) is twice as likely to cancel all of the challenged patent claims than to confirm all of the challenged claims.

All of these proceedings theoretically allow the patent owner to amend the claims of a challenged patent, which can be a significant advantage. Adjustments to the claims can focus the patent on important innovation or simply allow claims to escape cancellation, enabling the patent owner to emerge from the post-grant proceeding with a valuable patent. Moreover, a challenger who initiates a post-grant proceeding is limited in the types of challenges that it can later make against claims that survive the proceeding. The patent owner may pay a short-term price for making amendments because no damages can be collected for infringing an amended claim before the amendment officially becomes part of the patent. But that patent can be a long-term threat to the challenger, such that amendments could well be worth it for the patent owner.

However, in only a handful of the thousands of cases filed has the patent owner been allowed to amend the claims. The PTAB rejects over 90 percent of motions to amend, unless the patent owner is simply giving up and canceling claims outright. That dismal showing has prompted calls for change to make post-grant proceedings more balanced between patent owners and petitioners. Action by the PTAB, the courts or Congress is likely to make amendments a more viable option.

The Problem

Low rates of success in making amendments have been driven in large part by the way the PTAB implemented post-grant proceedings. There are express rules limiting amendments to only those that narrow claims and respond to a ground of unpatentability argued in the proceeding. More problematic restrictions flow from general limitations on requesting the PTAB take any action, including approving amendments. A request must be presented as a “motion,” limited to 15 pages in which the party filing the motion must prove entitlement to the requested action. In the context of a claim amendment, the PTAB has turned that into a requirement that the patent owner prove that an amended claim would meet every requirement of the Patent Act. That is a far cry from rebutting a rejection during ordinary patent prosecution, where the patentee need only rebut specific issues raised by a patent examiner.

The most problematic requirement has been inventiveness over the prior art. Many PTAB panels have found this requirement to be met only if the patentee can first prove what was known in the art and then show why the amended claim represents a patentable innovation over that. Add to the challenge of making these proofs the tight time limits in post-grant proceedings to make a motion to amend and the single chance to get it right, and it is easy to see why so many attempts to amend fail.

Changes by the PTO, Courts and Congress

Change started small. PTO Director Michelle Lee highlighted amendment practice at the top of a list of ‘‘quick fixes’’ announced in March 2015. Acknowledging that 15 pages ‘‘is not sufficient to explain adequately why the amended claims are patentable,’’ the PTO loosened the page limits, giving patent owners about twice the opportunity to make their case.

Lee also reported that the PTO is considering further changes as part of a ‘‘second rule package.’’ The notice suggested that patentees may soon be able to file motions without ‘‘mak[ing] a prior art representation as to the patentability of the narrowed amended claims beyond the art of record before the Office.’’ The proposed rule package was projected by the ‘‘end of July 2015’’—though that date has now slipped.

The PTAB itself has echoed these themes. In a July 15 “informative opinion” in MasterImage 3D v. RealD, the PTAB clarified that though the patent owner still must demonstrate a prima facie case of patentability, it need only do so relative to the prior art of record in the proceeding, creating a more finite and manageable obstacle to amendments.

The U.S. Court of Appeals for the Federal Circuit, too, has questioned the harsh requirements for making amendments. In Microsoft v. Proxyconn, the Federal Circuit took an interest in Proxyconn’s unsuccessful motion to amend during oral argument. It then issued an unusual order requesting that the parties and PTO submit letters addressing whether the PTAB’s restrictive approach to amendments was consistent with its own rules. At the end of the day, the Federal Circuit issued a decision limited to the facts of the case, as the patent owner had not shown the proposed amended claims were patentable even under a more lenient standard than used by the PTAB in other cases. However, the Federal Circuit stressed that it was not endorsing requirements as applied by the PTAB, leaving the door open for further action.

Congress also has the option to mandate changes to amendment practice. Senate Judiciary Committee Chairman Grassley called the amendment issue a ‘‘difficult nut to crack.’’ Yet, various proposals have been floated as part of reforming the post-grant process.

Those contemplating filing or needing to defend a post-grant proceeding would be well served to plan for more permissive claim amendments.

Navigating the Uncertainty: Petitioners

Petitioners now need to visualize how the prior art invalidates the claims as they are and how they might be after amendment. Petitions that stretch the prior art to meet the claims by relying on a broad reading might be enough to win initially, but will be ripe for defeat by claim amendments that negate that broad reading.

Petitioners should be ready to oppose potentially threatening amendments even before the patent owner seeks to amend, and preferably before their petition is even filed. The patent’s specification should be studied to understand what amendments might be made such that the patent would still cover products accused of infringement. Once the patentee files the actual motion, challengers typically have no more than three months to respond. In addition to enabling an opposition within the tight deadlines, locating the right prior art early opens up options. Where there is a risk of amendments that would result in threatening claims, the petitioner might choose to base the initial challenge on prior art that would hinder threatening amendments but at the cost of giving the patent owner advance notice of the prior art, or save that prior art for an opposition to a motion to amend.

Petitioners might also be judicious in selecting which claims to challenge. The PTAB’s rules generally allow a one-for-one substitution of challenged claims for amended claims. As more claims are challenged, the patent owner has more options for proposing amendments, as different claims might be amended in different ways. In the extreme, the petitioner might opt to forego a post-grant challenge entirely and save an invalidity challenge for litigation where amendments are not possible.

However, for the petitioner, amendments are not necessarily all bad. Because amendments do not become effective until after the PTAB issues a certificate, the delay between when amendments are proposed and when they are effective creates time for design-around strategies or other actions to avoid liability under the patent.

Navigating the Uncertainty: Patentees

Patent owners will be faced with strategic choices of whether, where and how to amend. Just because amendments are possible does not mean that amending is always the right strategy. Making claim amendments in reissue or, if there is a related application pending, in the related application may offer more flexibility. But depending on the nature of the prior art already in the proceeding or otherwise known to the patent owner, it may be preferable to push ahead with an amendment in a post-grant proceeding, so that the petitioner is bound, at least in some circumstances, by a finding that an amended claim is patentable.

The patent owner may propose ‘‘conditional’’ amendments—to be entered only if the PTAB concludes that the original challenged claims are not patentable and the amended claims are. Such an approach may seem to offer the best of both worlds. However, a failed amendment attempt in a post-grant proceeding can block attempts to get the same or similar claims in related proceedings. The PTO should require the patent owner to show that any claim presented in a related application has patentable differences relative to proposed amended claims that were rejected in a post-grant proceeding.

As a further trap for the unwary, patent owners proposing amendments in post-grant proceedings have a duty of candor, which at least some PTAB panels have suggested creates an obligation to disclose prior art bearing on the patentability of proposed amended claims. The consequences for failure to comply with that duty may be that courts will later refuse to enforce the patent, in the same way that a breach of the duty of disclosure in ex parte prosecution leads to the patent being unenforceable.


It will likely become easier for patentees to amend claims during post-grant proceedings. Both patentees and potential challengers should prepare for this shift, with petitioners making the best use of post-grant challenges and patent owners maximizing the chance of retaining valuable patent rights.