In IPR2014-01510, 01511, and 01513, in connection with its preliminary response the Patent Owner Mag Aerospace Industries, LLC, submitted an expert report by its expert in the related litigation. The expert report addressed issues relevant to the IPR proceedings, including the patentability of the claims in light of the prior art asserted in the IPRs. As explained below, the Board held that the expert report constituted "new" evidence and thus violates 37 C.F.R. § 42.107(c) even though it was created for the related litigation and not expressly for the IPR proceedings.

The Petition was filed on September 16, 2014. The expert report, filed as Exhibit 2002, is dated November 4, 2014, and was filed on January 2, 2015, along with the Patent Owner's Preliminary Response. It also is uncontested that the expert report was created for related litigation according to the schedule for that litigation. 

Among other things, the expert report included the opinions of the patent owner's litigation expert on the patents-at-issue relating to the field of the pertinent art, the level of ordinary skill in the art, the understanding of the prior art from the perspective of a person of ordinary skill in the art, whether the prior art, alone or in combination, disclose every element of the asserted claims of the patents-in-suit, and whether those claims would have been obvious in light of the combination of references.

The Board began by reciting the well-known rule regarding the allowable content of the preliminary response:

A patent owner's preliminary response may include evidence (37 C.F.R. § 42.107(a)), but "shall not present new testimony evidence beyond that already of record, except as authorized by the Board" (37 C.F.R. § 42.107(c)). In particular, expert witness testimony on patentability is an example of new testimony evidence that is not allowed in a patent owner preliminary response. See CHANGES TO IMPLEMENT INTER PARTES REVIEW PROCEEDINGS, POST-GRANT REVIEW PROCEEDINGS, AND TRANSITIONAL PROGRAM FOR COVERED BUSINESS METHOD PATENTS, 37 C.F.R. Part 42, Final Rule, 77 Fed. Reg. 48,680˗48,732, 48,689 (Aug. 14, 2012) (discussion regarding 37 C.F.R. § 42.107(c)); see also Id. at 48,701˗702 (comments 50, 51, and 53 and responses) (indicating that generally a patent owner submits testimonial evidence in the response rather than the preliminary response).

Here, the Board relied, in part, on the fact that the expert report was prepared after the filing of the petition to hold that it constituted "new" evidence in contravention of the rules and distinguished a prior case where the Board previously has held that evidence created for litigation is not considered "new":

We recognize that the Board has held that testimony evidence created for related litigation is not "new" under 37 C.F.R. § 42.107(c). Anova Food, LLC., v. Leo Sandau and William Kowalski, Case IPR2013-00114, slip op. at 2˗3 (PTAB June 25, 2013) (Paper 11). However, that case is distinguishable from the case at hand in that the exhibit at issue in Anova Food (Ex. 2009) was not testimony regarding patentability of any claim under review in that proceeding. Further, the Board has held that testimony created after the filing of the petition and for other than the proceeding at hand, such as that created for related litigation, is "new" testimony evidence under 37 C.F.R. § 42.107(c). See e.g. FLIR Sys., Inc. v. Leak Surveys, Inc., Case IPR2014-00434, slip op. at 33˗34 (PTAB Sept. 5, 2014) (Paper 8); C&D Zodiac, Inc., v. B/E Aerospace, Inc., Case IPR2014-00727, slip op. at 18˗19, (PTAB Oct. 29, 2014) (Paper 15); see also Amneal Pharmaceuticals, LLC v. Endo. Pharmaceuticals, Inc., Case IPR2014-01365, slip op. at 2˗3 (PTAB Nov. 14, 2014) (Paper 11) (similarly holding that testimony evidence created for another inter partes review is "new").

In this case, because the Board determined that the expert report was testimony regarding the patentability of the asserted claims and because it was created after the petition was filed, it was new. Accordingly, the Board stated that it will not consider the expert report in the determination of whether to institute inter partes review.

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The Board's determination of whether evidence is "new" appears to turn on whether the evidence was created after the filing of the petition. Assuming that it was created before the filing of the petition, in related litigation, and constitutes testimony regarding patentability of any claim under review, then it should not be considered "new" under 37 C.F.R. § 42.107(c) according to the Board's decision and thus will be considered in determining whether to institute trial.

B/E Aerospace, Inc. v. MAG Aerospace Industries, LLC, Case IPR2014-01510 (PTAB Jan. 20, 2015) (Paper 13) (A.P.J. Kauffman)