Argument Shifting at the PTAB: Balancing the Right of Reply against the Petition’s Role as Case-in-Chief

A vexing issue in post-grant patent practice is understanding the limits of how far a patent challenger can deviate from the four corners of its petition during the proceeding. The petition is the challenger’s case-in-chief. Petitions cannot be amended to address either the patent owner’s claim construction positions or its arguments and evidence rebutting the petitioner’s grounds of unpatentability. Of course, the petitioner can respond to the patent owner’s arguments, but it “may not submit new evidence or argument in reply that it could have presented earlier [in the petition], e.g., to make out a prima facie case of unpatentability.” US Patent Trial and Appeal Board, Consolidated Trial Practice Guide 73 (Nov. 2019). See also Rembrandt Diagnostics, LP v. Alere, Inc., 76 F.4th 1376, 1384 (Fed. Cir. 2023) (“the very nature of the reply and sur-reply briefs are to respond (whether to refute, rebut, explain, discredit, and so on) . . . within the confines of 37 C.F.R. § 42.23(b).”). But what are those confines, and what facts and issues are fairly framed by the petition?

The answers are necessarily fact-dependent, but the Federal Circuit and the US Patent Trial and Appeal Board (“PTAB”) have established certain boundaries for a number of scenarios. In the leading cases of Rembrandt and Axonics, Inc. v. Medtronic, Inc., 75 F.4th 1374 (Fed. Cir. 2023), the court permitted the consideration of the petitioners’ “new” arguments and evidence, and explained that a petitioner is permitted to: (1) expand on previously raised arguments that have a nexus to an argument made by the patent owner or the Board; and (2) assert the same “legal ground” as its petition by relying on the “same prior art” to support the “same legal argument,” even where a new example or an additional portion of the same prior art reference is used by the petitioner in reply. Rembrandt, 76 F.4th at 1383-84; Axonics, 75 F.4th at 1384 (petitioner can reply to patent owner’s new claim construction by relying on the same prior art from the petition).

Conversely, a reply is improper where a petitioner: (1) introduces a new prior art reference that was not disclosed in the petition to support a contention that is “meaningfully distinct” from what is disclosed in the petition; or (2) introduces a new theory of unpatentability, such as where the petitioner asserted in its petition that a single reference disclosed a limitation and then instead argued in its reply that there was a motivation to combine references to arrive at the limitation. Id. Additional cases discussing the boundaries include the following:

• The petitioner’s reply did not improperly add new argument where the petitioner argued that a prior art embodiment, cited in the petition, satisfies a claim limitation even applying the patent owner’s construction of the limitation. The Board highlighted that the Administrative Procedure Act required the Board to give the petitioner adequate notice and an opportunity to respond under a new construction first proposed in the patent owner’s response. DraftKings Inc. v. AG 18, LLC, No. IPR2022-01447, 2024 Pat. App. LEXIS 1007, at *53 (P.T.A.B. Mar. 13, 2024).
• In analyzing the petitioner’s reply, the Board excluded: (i) new arguments about how a certain claim term is arranged and the only way to incorporate the prior art into such term; (ii) new expert opinion evidence; and (iii) new arguments of how a POSITA would apply the prior art. Dynaenergetics Eur. Gmbh & Dynaenergetics US, Inc. v. Swm Int’l, LLC, No. IPR2022-01372, 2024 WL 422604, at *14 (P.T.A.B. Feb. 5, 2024).
• Petitioner’s reply did not present an improper new theory of obviousness by providing further detail for how a POSITA would have modified Iwamiya’s device to use red and infrared light to measure blood oxygen saturation, where: (1) the petition originally detailed that it would have been obvious to modify prior art reference Iwamiya in view of Sarantos’ teaching regarding how red and infrared light may be used to determine blood oxygen saturation; and (2) in response to the petition, the patent owner argued that the combination of Iwamiya and Sarantos would have been inoperable. Apple Inc. v. Masimo Corp., No. IPR2022-01465, 2024 Pat. App. LEXIS 670, at *56-57 (P.T.A.B. Feb. 2, 2024).
• The petitioner’s reply was proper, because it responded to the patent owner’s proffered narrow claim construction that the Board adopted as an alternative in the Institution Decision. No new obviousness theory was advanced in the reply, “except to the extent it explicitly folds the analysis of claim 3 into responding to Patent Owner’s arguments regarding Patent Owner’s narrow claim construction for claim 1, which is proper both in Reply and in the Petition.” AT&T Corp. v. Dali Wireless Inc., No. IPR2022-01212, 2024 WL 344159, at *22 n.17 (P.T.A.B. Jan. 30, 2024).
• Arguments responsive to the patent owner and expanding on positions in the petition were proper where the petitioner’s explanation was a “logical extension” of the previously cited prior art reference. Caterpillar Inc. v. Wirtgen Am., Inc., IPR2022-01264, 2024 WL 230734, at *22 (P.T.A.B. Jan. 22, 2024).
• The petitioner was permitted in reply to introduce new evidence and arguments (i.e., expert testimony and new prior art references) regarding the functionality of prior art cited in the petition to show “the knowledge that a skilled artisan would bring to bear” in reading the same aspects of the references cited in the petition. Wildcat Licensing WI LLC v. Atlas Copco Tools & Assembly Sys. LLC, No. 2022-1303, 2024 U.S. App. LEXIS 543, at *6-8 (Fed. Cir. Jan. 9, 2024).
• The petitioner was permitted to introduce new evidence in reply to support the prior art status of abstracts cited in the petition after the patent owner challenged the sufficiency. It was proper for petitioner to present new evidence that the abstracts were publicly presented and disseminated at conferences before the critical date. United Therapeutics Corp. v. Liquidia Techs., Inc., No. 2023-1805, 2023 U.S. App. LEXIS 33718, at *7-10 (Fed. Cir. Dec. 20, 2023).
• The petitioner’s reply arguments were proper where the petitioner relied on portions of a prior art reference that were not cited in the petition but were related to the same embodiment that was cited. W. Digital Techs., Inc. v. Viasat, Inc., IPR2022-01171, 2023 WL 8632391, at *9 (P.T.A.B. Dec. 13, 2023).
• In reply, the petitioner was allowed to rely on prior art references not cited in the petition (Tatsuzuki and Bence) because the patent owner’s response opened the door for petitioner to argue that patent owner took an inconsistent position as to Tatsuzuki in a prior IPR. As to Bence, it was cited by the patent owner, thereby again opening the door for the petitioner to argue that Bence supports petitioner’s arguments. Amphenol Corp. v. PPC Broadband, Inc., No. IPR2022-00721, 2023 WL 7003345, at *16 (P.T.A.B. Oct. 24, 2023).
• The petitioner was allowed to reply with an elaboration of the bases on which its references satisfy the analogous art requirement under the “field of endeavor” and “pertinent problem” tests, even where the petition only invoked one of these tests, because these two tests are not independent, different grounds for obviousness or new “rationales,” but are, instead, related bases for the same, single ground of invalidation—obviousness—and are based on the same references identified with particularity in the petition. Corephotonics, Ltd. v. Apple Inc., 84 F.4th 990, 1010 (Fed. Cir. Oct. 16, 2023).
• A petitioner cannot argue in reply that it would have been obvious to modify the prior art where the petition argued only that the prior art disclosed a particular claim limitation; the reply argument that a POSITA would have modified the prior art was a “meaningfully distinct contention” from arguments limited to what the prior art reference teaches. Yita LLC v. MacNeil IP LLC, 69 F.4th 1356, 1366-67 (Fed. Cir. Jun. 6, 2023).
• It is proper for a petitioner in reply to cite for the first time to examples from the same prior art cited in the petition for the same legal argument. Apple Inc. v. Andrea Elecs. Corp., 949 F.3d 697, 706 (Fed. Cir. 2020).

The limits on permissible petitioner replies will continue to evolve and will require that practitioners be vigilant—if not clairvoyant—in constructing petitions. Moreover, patent owners are likewise barred from raising impermissible new arguments in a sur-reply so both sides need to understand their strengths and weaknesses from the outset.

Disclaimer: This article is for informational purposes only, and is not intended to be legal advice. It only reflects the present personal views of the authors, which are not to be attributed to Mayer Brown LLP or the firm’s clients.