The PTAB recently denied institution of an inter partes review (IPR) on the basis of the estoppel provision of the AIA (35 USC § 315(e)). Apotex Inc. v. Wyeth LLC, IPR2015-00873, Paper 8 (PTAB Sept. 16, 2015). The decision is not appealable, and is significant because it offers guidance on how the PTAB will construe this provision and offers examples of when the PTAB will and will not apply the provision to deny grounds for an IPR. As explained below, a ground previously denied as redundant may be the subject of a subsequent IPR petition and will not implicate the estoppel provision, whereas the petitioner, in a subsequent IPR, likely will be estopped from presenting a previously unasserted ground that relies on prior art publications discussed in the earlier IPR petition.

Background

The patent, which is the subject of ANDA litigations, includes 23 claims and is directed to the drug product Tygacil® made and sold by Wyeth Pharmaceuticals Inc., a subsidiary of Pfizer Inc. The petition presents two grounds of obviousness. Ground #1 relies on the teachings in three prior art publications, A through C, to argue that a subset of these claims is obvious. Ground #2 relies on the teachings in five prior art publications, Athrough E, to argue that the remaining claims are obvious. As explained below, Ground #1 was denied on its merits, whereas Ground #2 was denied in view of the estoppel provision.

In an earlier IPR proceeding (IPR2014-00115) between these same parties and concerning the same patent, the PTAB issued a final written decision (on April 20, 2015) concluding that none of the 23 claims was unpatentable in view of the sole instituted ground (based on prior art publications AC, and X). In that proceeding the petitioner had advanced six other grounds of unpatentability, but the PTAB determined that those six grounds were redundant to the one on which it instituted IPR and, accordingly, denied institution on those grounds. According to the PTAB, one of the denied grounds (Ground #6) was equivalent to Ground #1 in the ’873 IPR.

The applicable estoppel provision of the AIA states:

The petitioner in an inter partes review of a claim in a patent under this chapter that results in a final written decision under section 318(a), or the real party in interest or privy of the petitioner, may not request or maintain a proceeding before the office with respect to that claim on any ground that the petitioner raised or reasonably could have raised during that inter partes review.

35 USC § 315(e)(1); see also, 35 USC § 325(e)(1) (regarding post grant review estoppel). The patent owner opposed the ’873 IPR petition, arguing the estoppel provision prevents the petitioner from requesting IPR because both asserted grounds could have been raised in the ’115 IPR.

Estoppel Will Not Apply to Re-petitioning on Previously Denied Grounds

The PTAB refused to apply the estoppel provision to deny Ground #1 (equivalent to Ground #6 in the ’115 IPR). According to the PTAB, it did not reach the merits of this prior art attack when it denied the equivalent Ground #6 as being redundant. According to the PTAB, an IPR does not begin until the PTAB decides to institute review, the period preceding this institution decision and following the filing of the petition is a “preliminary proceeding” and, thus:

  • Grounds raised in that preliminary proceeding—but not made a part of the instituted IPR—are not grounds raised “during” an IPR and cannot be the basis for estoppel,
  • Such grounds also are not ones that “reasonably could have been raised during” the IPR because, once denied, the PTAB’s institution decision prevents the petitioner from raising that ground during the IPR trial.

Because the basis underlying Ground #1 was never raised during the ’115 IPR—but raised only in the petition for the ’115 IPR—the petitioner is not estopped from later presenting it in a new petition. The PTAB thus evaluated the merits of Ground #1, ultimately concluding that the record before it did not establish a reasonable likelihood that the petitioner would prevail with respect to at least one claim. Accordingly, the PTAB denied institution on Ground #1.

Estoppel Will Apply When Re-petitioning on a Ground that Could Have Been Previously Raised

The PTAB applied the estoppel provision to deny institution on Ground #2—a ground not previously presented. On the record before it, the PTAB concluded that the petitioner was aware of all of five of the prior art publications (A through E) underlying Ground #2 when it previously petitioned for IPR of the patent. Although publication E was not among those underlying any of the seven grounds previously presented, the petitioner described publication E and the pertinence of its teachings when it filed the petition for the ’115 IPR. The PTAB found that the petitioner is now citing that publication in support of Ground #2 for the same teachings.

Because the petitioner knew of publication E and what it teaches when it filed the ’115 IPR petition, the PTAB determined that petitioner could have raised Ground #2 in the ’115 IPR petition and, thus, reasonably could have raised it during the trial of the ’115 IPR. Accordingly, the PTAB applied the estoppel provision to deny institution on Ground #2.

Observations

Presenting multiple grounds offered this petitioner the ability to advance one of the redundant grounds in a later (IPR) proceeding. Regardless of whether the PTAB’s institution decision is the correct disposition of this petitioned ground, it appears to be a fair one. There is no certainty that the instituted grounds in the first proceeding were any stronger than the denied, “redundant” grounds. Having paid the petition fees in a later proceeding, the petitioner ought not be estopped from requesting a trial on the denied, redundant ground without consideration of its merits. Although this decision is not precedential, one would expect consistent interpretations from other PTAB panels. The decision may also encourage district court judges, interpreting the similar estoppel provisions for court proceedings (35 USC §§ 315(e)(2) and 325(e)(2)), to permit petitioners to raise invalidity arguments based on denied, redundant grounds.

You might think that the decision counsels strongly in favor of presenting multiple grounds, with expectations that IPR will be instituted on at least one ground, leaving for a future IPR the opportunity to present the denied redundant grounds. But, presenting multiple IPR grounds can compromise the strength of the eventually-instituted ground due to the limitations on the length of petitions. Having devoted only a fraction of the petition to the eventually-instituted ground puts the petitioner at a disadvantage relative to the patent owner when it comes to the final written decision. In this instance, the patent owner will have had a full opportunity, following institution, to develop its patentability defense, whereas the petitioner will be confined to supporting its instituted ground under the constraints of a reply brief.

Recall, the petitioner lost the first IPR (where it presented multiple grounds) on the merits, and now has been denied a second IPR. While the petitioner is appealing to the Federal Circuit the PTAB’s final written decision in the first IPR, neither party may appeal the PTAB’s denial of the second IPR. Indeed, because the Federal Circuit has stated it lacks jurisdiction to review the PTAB’s institution decisions, rarely will the PTAB’s application of the estoppel provision ever be the subject of judicial review. This is yet another reason the Federal Circuit should reconsider its jurisdiction, or Congress should revise the AIA.