- IPR Claim Amendment Limitations Apply to Covered Business Method Patent Review and Amendments for 35 U.S.C. §101 Purposes
- February 4, 2014
- Law Firm: Sughrue Mion PLLC - Washington Office
As discussed previously, the Board has imposed significant limitations on a Patent Owner’s ability to amend a claim in inter partes review. See Idle Free Systems, Inc. v. Bergstrom (IPR2012-0027 Paper 26). These limitations include a requirement for a Patent Owner to show patentability of the proposed amendments over the prior art. Idle Free at 7-8. Recently, the Board has imposed these limitations to amendments made solely for 35 U.S.C. § 101 purposes in a CBM.
In Volusion Inc. v. Versata Software, Inc. (CBM 2013-00017 & CBM2013-00018, Paper 26), Versata sued Volusion in the Western District of Texas alleging infringement by Volusion's e-commerce software of US Patent Nos. 6,834,282 and 7,426,481. Volusion, in response, instigated a CBM proceeding arguing that the patent claims were not drawn to patent-eligible subject matter under 35 U.S.C. §101. Versata thereafter sought to amend the patent claims under 37 C.F.R. §42.221 without the requirements imposed by the Board’s Idle Free decision.
Versata argued that Idle Free is inapplicable as it was only directed towards amendments in an IPR (which is governed by 35 U.S.C. § 316(d) and 37 C.F.R. §42.121) and not in a CBM (which is governed by 35 U.S.C. § 326(d) and 37 C.F.R. §42.221). The Court, however, disagreed and explained that the statutory and regulatory language controlling amendments in IPR and CBM proceedings is virtually identical. Therefore, Idle Free is proper guidance for proposed amendments in CBM proceedings.
Alternatively, Versata argued that to the extent Idle Free was applicable in a CBM proceeding, the burden of the Patent Owner to show patentability of the proposed substitute claims over the known prior art should not apply where the sole basis for the review is unpatentability based on 35 U.S.C. § 101. Rather, according to Versata, a patent owner should only need to show that its proposed claims are patent eligible under 35 U.S.C. § 101.
The Board was not persuaded and noted that addressing the grounds involved in the trial is only one of the requirements for amendment in a CBM proceeding. In addition, a proposed amendment must not enlarge the scope of the claims, must not introduce any new matter, and must be supported by the original disclosure. Further, the burden of proof to establish entitlement of relief falls to the Patent Owner for all amendments in a CBM proceeding. 37 C.F.R. § 42.20(c). This includes the burden of showing that the proposed amendments are patentable over the known prior art. Idle Free at 7-8. Since there are no statutory or regulatory exceptions based on the review, all requirements exist for all proposed amendments in IPR and CBM proceedings.
The Volusion order further demonstrates the significant limitations and burdens of amendments under the new post-grant procedures. Unlike in prosecution, the Patent Owner has the burden of showing it is entitled to an amendment and that its proposed amendments are fully patentable, regardless of the amendment's purpose.