Design Patents and IPR: Challenging and Defending Validity...

Design Patents and IPR: Challenging

and Defending Validity at the PTAB Navigating Prior Art and Obviousness Analyses, Leveraging IPR for Design Patents

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TUESDAY, OCTOBER 18, 2016

Presenting a live 90-minute webinar with interactive Q&A

Elizabeth D. Ferrill, Partner, Finnegan Henderson Farabow Garrett & Dunner, Washington, D.C.

Mark W. Rygiel, Director, Sterne Kessler Goldstein & Fox, Washington, D.C.

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October 18, 2016

S K G F. C O M

Design Patent PTO Litigation: Statistics, Trends, and Strategies

Mark Rygiel, Esq.

© 2016 Sterne, Kessler, Goldstein, & Fox P.L.L.C. All Rights Reserved. 5 S K G F. C O M

Agenda

1. Background on Design Patent Challenges

2. Similarities/Differences with Utility Challenges

3. Pre-Trial Trends and Best Practices

4. Post-Institution Considerations


Design Patent Challenges

• The same PTO Litigation proceedings are available to design

patents as utility patents.

PTO Litigation: Inter partes proceedings created by the America Invents Act

of 2012 for contesting the patentability of issued US patents at the PTAB

(e.g. IPRs, CBMs, and PGRs)

IPR: An inter partes review proceeding

PGR: A post-grant review proceeding

• Ex Parte Reexaminations remain available.

• Some legacy inter partes reexaminations remain pending, but no

new IPX proceedings are available.


Comparison of the Proceedings

IPR PGR

Field Any Any

Grounds

Patents and printed

publications under

102 & 103

101, 112, and all 102

& 103 prior art

Timing*

Pre-AIA Patents:

Anytime

Post-AIA Patents:

Later of: 9 mos after

issue or re-issue,

termination of PGRs

Pre-AIA Patents:

Not available

Post-AIA Patents:

Must file within 9 mos

of issue

Standard Reasonable likelihood

that a claim is invalid

More likely than not

that a claim is invalid

* Assuming no Petitioner filing bars (e.g. civil action bar or 1-year bar) apply


PTO Litigation Timeline

Petition Filed

PO Preliminary Response

Decision on

Petition

PO Response & Motion to

Amend

Petitioner Reply & Opposition

Oral Hearing

Final Written Decision PO Reply

3 month no more than 3 mos

2-3 months 2-3 months 1 month 1-2 mos

PO Discovery

Period

PO Discovery

Period

Petitioner Discovery

Period

“Trial” Phase: Must be completed within 12 mos (18 mos in exceptional circumstances)

Motions To

Exclude


Design Patent Challenges

• Including non-AIA proceedings, there is generally a rise in post-

grant design patent challenges:

4 5

3 4

5

17

4

9

7

3

8 8 7

12

3

19

13

7

9 10

11

20

9 8

15

0

5

10

15

20

25

Design Patent Post-Grant Challenges By Year (through June 2016)


0

2

4

6

8

10

12

14

16

2012 2013 2014 2015 2016

1

5 4

3

15

Design Patent PTO Litigation

• To date, there have been 28 design patent proceedings since adoption of the AIA

(26 IPRs and 2 PGRs).

• Design patent proceedings are less than 1% of total PTO litigation.

Design PTO Litigation per year

IPR

PGR

2


Similar or Different?

• Big Picture: many believe PTO litigation favors the Petitioner. True

for designs?

- To date, only 21 institution decisions and 6 FWDs for designs

- Institution rate (proceeding): Overall (71%); Designs (43%)

- Institution rate (claim): Overall (62%); Designs (43%)*

- FWD claim cancel rate: Overall (81%); Designs (100%)

• ‘Broadest reasonable’ claim interpretation standard applies

• Trial conducted by a technically savvy panel of three judges

- Better understanding of technical arguments and patent law than most

district court judges

- No “Tech Center 2900” of PTAB


Similar or Different?

• As with utility challenges, co-pending litigation at time of filing is

prevalent

When reexaminations are included, potential design infringers may be more pro-

active than others.

Data relating to litigation stays is consistent with utility cases

• To date, predominately domestic petitioners (89%) for designs

• Designs covering a wide range of technology areas have been

challenged

- Apparel - Medical Equipment

- Furnishings - Food and Beverage Equipment

- Jewelry - Building materials

- Transportation - Tools


Pre-Trial: Petition

• The Petitioner must provide evidence (i.e. prior art and declarations)

showing all required statutory, rule, and procedural thresholds are met

• Almost no further chance is provided for the Petitioner to remedy

evidentiary gaps

• Not too early to take into account demonstratives and oral arguments

• Design IPR petitioner should be thinking about the same issues: strong

prior art, convincing evidence, proper claim construction and complete

analysis.


Pre-Trial: Grounds for Rejection

• Anticipation

• 3 design IPR FWDs in which claim canceled under § 102

• The ordinary observer or purchaser

• More difficult with designs?

• IPR2015-01453, Decision Instituting (finding reasonable likelihood of Petitioner prevailing under 102 grounds where construction not limited to a specific color).

• Obviousness

• All 6 design IPR FWDs include claim canceled on § 103 ground

• The designer of ordinary skill

• Number of Grounds


• § 112

• PGR

• To date, 2 of the 37 PGR petitions filed challenge design patents

• Likely to see an upward trend in filings?

• Challenging the priority claim in IPR

Figure 12A of Hakim '604 Publication Figure 3 of Challenged '465 Patent

• IPR2013-00072 (Child Drinking Cup)

Pre-Trial: Grounds for Rejection


Pre-Trial: Prior Art

• With designs, Patent Owner’s own prior art is often most

useful.

• Utility patents can be (and have been) used successfully in

design challenges.

See, e.g., IPR2015-00306, FWD canceling claim (claim canceled

as obvious over vanity light shade utility patent reference)

• Non-patent literature

• Was the prior art publically available?

See, e.g., IPR2016-00434 (noting that no evidence was proffered

that cited NPLs were publicly accessible)


Pre-Trial: Prior Art

• Any use of modified drawings in Petition should be done carefully.

Image from prior art Magnified image in Petition

• See, e.g., IPR2016-00130 (Building Insulation), Decision Instituting (magnified image of prior art reference supported by declaration)

• IPR2013-00259 (Building Panel), Decision Denying Institution (no indication of amount of magnification and no declaratory evidence)


Pre-Trial: Experts

• In evaluating validity of design patents, two related concepts are

relevant: the “ordinary observer or purchaser” of the patented article

and the “designer of ordinary skill.”

• Expert does not have to be POSA necessarily but POSA must be

properly identified

• Use of expert testimony is critical for Petitioner

IPR2016-00434 (Diamond Jewelry)

IPR2015-00947 (Bottle)

• Identifying the correct expert is also critical


Pre-Trial: Patent Owner Preliminary Response

• Similar checklist of issues for the design Patent Owner:

- Was the Person of Ordinary Skill in the Art properly identified?

- Are all Real Parties-in-Interest properly identified?

- Are claims properly construed?

- Are all Graham requirements addressed including secondary

considerations?

- Are references properly combined?

- Are the references actually prior art?

- Did Petitioner adequately prove prior art publication date?



• Heightened opportunity to attack obviousness analysis

Claim construction

IPR2015-00947, Decision Denying Institution (PTAB not persuaded by

Petitioner’s claim construction “because it focuses on general dimensions,

ratios, and elements common to many bottles.”)



• Heightened opportunity to attack obviousness analysis

Failure to focus on the overall appearance

IPR2016-00767, Decision Denying Institution (expert’s “side-by-side” comparison was “merely a two-dimensional comparison” and did not take into account entire design)

Focus on design concepts rather than overall visual appearance

IPR2016-00434, Decision Denying Institution (Petitioner focused on a general design concept – mixing stones of different cuts – rather than distinctive visual appearances.)

IPR2016-01004, POPR (Petitioner focused on knitting concepts and manufacturing techniques rather than overall appearance)



• For design PTO Litigation, is the calculus for using an expert at POPR

stage different?

• Overall, used in about 37% cases since becoming available

• Use for factual attacks? (see, e.g., IPR2016-01044, Paper No. 6, where the

Petitioner failed to explain why ordinary designer would select two shoe

upper designs over the hundreds shown in the complete reference)

• Secondary Considerations

• Were they raised in prosecution (or other proceeding) and adequately

addressed by Petition?

• Success rate in PTO litigation for Patent Owner generally is extremely low.

• Better or worse for designs?


• Board is condensing trial to 6-7 months, and only 8-10 weeks to POR

• Objections to evidence must be made within 10 days of institution

• Patent Owner Response

Expert considerations

Deposing petitioner’s expert

Definition of POSA

Claim construction

Prior art teaching

Qualifications to be an expert

Claim Amendments?

• Petitioner Reply

Post Institution Considerations


Thank You

Mark W. Rygiel, Esq.

[email protected]

mailto:[email protected]

Finnegan, Henderson, Farabow, Garrett & Dunner, LLP

Trends in Design Patent Post-Grant

Proceedings

Elizabeth D. Ferrill

October 18, 2016

26 26

Trends in Design Post-Grant Reviews

• 102 – Anticipation cases

• 103 – Obviousness cases

• Challenges to priority

• PGR petitions

27 27

IPR Petitions with Anticipation Grounds

28 28

Anticipation Framework

Int’l Seaway v. Walgreens

“[T]he ordinary observer test must logically be the sole

test for anticipation as well.”

Ordinary Observer Test

“[Whether] an ordinary observer, familiar with the prior art designs,

would be deceived into believing that the

accused product is the same as the patented

design.”

589 F.3d 1233 (Fed. Cir. 2009)

Richardson v. Stanley Works,

597 F.3d 1288 (Fed. Cir. 2010)

29 29

Trend No. 1:

Design patent owner may be

their own worst enemy.

30 30

Sensio Inc. v. Select Brands, Inc.

IPR2013-00500

31 31

Trend No. 2:

Scope of the claim matters.

32 32


IPR2013-00500

33 33


IPR2013-00500

34 34

Trend No. 3:

The bulk of the utility patent

precedent applies to design IPRs.

35 35


• Select Brands attempted to antedate the

references by showing a reduction to practice of

the of the design before the earliest publication

date of the references

• Supported by nearly identical declarations from

three inventors regarding reduction to practice

• Sensio argued that patent owner had failed to

show inventors conceived of the design

36 36


• “Patent Owner must show it conceived the design

and communicated the design to [the third party] in

order for the prototypes [made by the third party] to

inure to Patent Owner’s benefit.”

• The Board dismissed the Patent Owner’s

arguments that the inurement precedent should be

limited to the interference context or should not

apply to design patents.

37 37

IPR Petitions with Obviousness Grounds

38 38

Obviousness Framework

Primary Reference

Design characteristics of which are basically the same as the

claimed design

(1) discern the correct visual impression created by the patented design as a whole;

(2) single reference that creates “basically the same” visual

impression

Secondary Reference

Can modify the primary reference “to create a design

that has the same overall visual appearance as the

claimed design.”

Appearance of certain ornamental features in one would suggest

the application of those features to the other

39 39

Trend No. 4:

Carefully select the primary

reference to make sure it

is “basically the same.”

Claimed Design Prior Art

40 40

Dorman Prods. v. Paccar

IPR2015-00416 (June 14, 2016)

41 41


IPR2015-00416 (June 14, 2016)

42 42


• Different visual impressions

• Relative length of sides, angles between sides

IPR2014-00555 (Sept. 5, 2014)

Kobayashi Claimed Design

43 43


• Different visual impressions

• Relative length of sides, angles between sides

IPR2014-00555 (Sept. 5, 2014)


44 44


• D429 gives the visual impression of a four-sided

trapezoid, while Kobayashi gives the impression of

a right triangle with a hypotenuse formed by its top

and right sides.

IPR2014-00555 (Sept. 5, 2014)


45 45

Caterpillar v. Miller Int’l

IPR2015-00416(June 14, 2016)

46 46


IPR2015-00416(June 14, 2016)

47 47


IPR2015-00416(June 14, 2016)

48 48


• “The Coupler Manual is a suitable primary reference

because the Coupler Manual warning symbol gives the

same overall visual impression when compared to the

claimed warning symbol design as a whole.”

IPR2015-00416 (June 14, 2016)

Coupler Manual Claimed Design

49 49


• “The requirement that the design characteristics of the

proposed primary reference be the same as the claimed

design does not imply that the appearance of the prior art

article must be identical to the claimed design.”

IPR2015-00416 (June 14, 2016)

Coupler Manual Claimed Design

50 50


IPR2015-00416 (July 5, 2016)

Hub Coupler Manual

• “Hub is a suitable secondary reference because Hub, like

the Coupler Manual, also discloses a coupler for an

earthmoving machine.”

51 51

Trend No. 5:

For obviousness, motivation to

combine the primary reference and

secondary reference should not be

overlooked.

52 52

• Not shown that POSITA would have used the reference to

modify the primary

Premier Gem v. Wing Yee Gems

IPR2015-00416 (July 5, 2016)

Lotus Carat

Claimed Design

Heritage Art Deco

53 53

• Not shown that POSITA would have used the reference to

modify the primary

Premier Gem v. Wing Yee Gems

IPR2015-00416 (July 5, 2016)

Lotus Carat

Claimed Design

Heritage Art Deco

54 54

• Teo disclosed using “a flexible magnetic material for the

entire warning sign . . . permitting attachment of the

warning sign . . . to a curved surface.”


IPR2015-00416 (July 5, 2016)

Hub Coupler Manual Teo

55 55

• Teo disclosed using “a flexible magnetic material for the

entire warning sign . . . permitting attachment of the

warning sign . . . to a curved surface.”


IPR2015-00416 (July 5, 2016)

Hub Coupler Manual Teo

56 56

Trend No. 6:

Challenging priority is possible,

but can be complicated.

57 57

Sketchers U.S.A., Inc. v. Nike, Inc.

Priority Filing U.S. Design Application IPR2016-00870

58 58

Sketchers U.S.A., Inc. v. Nike, Inc.

Priority Filing U.S. Design Application

IPR2016-00870

59 59

Munchkin, Inc. v. Luv N’ Care, Ltd

IPR2013-00072

60 60

Thank You

61 61

Speaker Information

Elizabeth D. Ferrill ([email protected]/1.202.408.4445)

Focuses her practice on all aspects of design patents, including

prosecution, counseling, and litigation

Extensive experience in utility patent litigation in the areas of software-

and hardware-related technologies

62 62

Disclaimer

These materials are public information and have been prepared solely for

educational and entertainment purposes to contribute to the understanding

of U.S. intellectual property law. These materials reflect only the personal

views of the authors and are not a source of legal advice. It is understood

that each case is fact specific, and that the appropriate solution in any

case will vary. Therefore, these materials may or may not be relevant to

any particular situation. Thus, the authors and Finnegan, Henderson,

Farabow, Garrett & Dunner, LLP cannot be bound either philosophically or

as representatives of their various present and future clients to the

comments expressed in these materials. The presentation of these

materials does not establish any form of attorney-client relationship with

the authors or Finnegan, Henderson, Farabow, Garrett & Dunner, LLP.

While every attempt was made to ensure that these materials are

accurate, errors or omissions may be contained therein, for which any

liability is disclaimed.

Design Patents and IPR: Challenging and Defending Validity...

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