Patent Case Summaries August 16, 2023

Patent Case Summaries | Week Ending August 11, 2023

Axonics, Inc. v. Medtronic, Inc., Nos. 2022-1532, -1533 (Fed. Cir. (PTAB) Aug. 7, 2023). Opinion by Dyk, joined by Lourie and Taranto.

Axonics filed IPR petitions challenging claims in two Medtronic patents directed to transcutaneous charging of implanted medical devices. In the petitions, Axonics did not propose an express construction of any claim term, but the claim charts accompanying the petitions adopted a construction of two “wherein” clauses such that the clauses require a power source using only a single input (the “one-input” construction).

The Patent Trial and Appeal Board instituted the IPRs. Medtronic then filed a patent owner response arguing that the Board should construe the two “wherein” clauses to require separate inputs (the “two-input” construction). Medtronic also argued that the petitions had not identified two separate inputs in any of the prior art references.

In Axonics’ reply, it continued to defend the one-input construction but also argued, under Medtronic’s new two-input construction, that the prior art satisfied the two “wherein” clauses. In the Board’s final written decisions, the Board adopted Medtronic’s two-input construction and refused to consider Axonics’ arguments and evidence under that construction because Axonics had not presented the arguments in its petitions, rendering them improper reply arguments. Axonics appealed.

The Federal Circuit disagreed with the Board’s approach. The court held that “where a patent owner in an IPR first proposes a claim construction in a patent owner response, a petitioner must be given the opportunity in its reply to argue and present evidence of anticipation or obviousness under the new construction, at least where it relies on the same embodiments for each invalidity ground as were relied on in the petition.” The Federal Circuit noted that “[t]he Board’s rules do not address the specific question presented here.” But the court’s precedent establishes that, “under the APA, when the Board adopts a new claim construction following institution, an IPR petitioner must have adequate notice and an opportunity to respond under the new construction.” Here, the Board did not afford Axonics that opportunity. Accordingly, the Federal Circuit vacated the Board’s decisions and remanded for the Board to consider Axonics’ arguments and evidence under the two-input claim construction.

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Rembrandt Diagnostics, LP v. Alere, Inc., No. 2021-1796 (Fed. Cir. (PTAB) Aug. 11, 2023). Opinion by Reyna, joined by Moore and Dyk.

Alere filed an IPR petition challenging the patentability of claims in a Rembrandt patent directed to test assay devices and methods for testing biological fluids. Alere argued that the challenged claims would have been obvious over two combinations of prior art patents.

After Rembrandt filed a patent owner response, Alere filed a reply with an accompanying expert declaration. Rembrandt then filed a sur-reply arguing that Alere had “resorted to new theories in reply,” but Rembrandt’s argument did not specifically contest that Alere or its expert had raised new theories in reply for the specific combinations of prior art now at issue in the appeal. The Patent Trial and Appeal Board concluded that the challenged claims would have been obvious, and Rembrandt appealed.

The Federal Circuit held that the Board did not abuse its discretion by relying on Alere’s reply theories and evidence. Foremost, the Federal Circuit ruled that Rembrandt forfeited its argument that Alere had offered new theories. Although Rembrandt’s sur-reply had asserted that Alere “resorted to new theories in reply,” the court held that this “generic objection is insufficient to constitute a proper objection—especially because Rembrandt expressly objected to other allegedly new theories without doing so here.”

Turning to the substance of Rembrandt’s new-theories argument, the Federal Circuit noted that “there is no blanket prohibition against the introduction of new evidence during an IPR.” “In fact, the introduction of new evidence in the course of the trial is to be expected in IPR trial proceedings and permissible as long as the opposing party is given notice of the evidence and an opportunity to respond to it.” Here, Alere’s reply argument had “a nexus to Rembrandt’s prior argument and is responsive,” and the reply argument “also properly expands on and is a fair extension of [Alere’s] previously raised efficiency argument.” Thus, Alere’s reply argument did not constitute a new theory, and the Board did not abuse its discretion in considering it.

The Federal Circuit also determined that substantial evidence supported the Board’s factual findings underlying its obviousness determination. Thus, the court affirmed the Board’s determinations.

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