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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`
`
`
`ARGENTUM PHARMACEUTICALS LLC,
`Petitioner,
`
`v.
`
`RESEARCH CORPORATION TECHNOLOGIES, INC.,
`Patent Owner.
`
`Case No. IPR2016-00204
`Patent No. RE 38,551
`
`PATENT OWNER’S OPPOSITION TO PETITIONER’S
`MOTION TO CONSOLIDATE REEXAMINATION
`WITH INTER PARTES REVIEW
`
` DC: 6116158-8
`
`
`
`IPR2016-00204
`
`029819.0100-US03
`
`Consolidation here would violate the statutory provision governing the scope
`
`of IPR proceedings because all of the bases of alleged unpatentability at issue in
`
`the ex parte reexamination are outside the scope of permissible grounds for an
`
`Inter Partes Review (“IPR”). Petitioner has identified no instance where the Board
`
`has consolidated an IPR with an ex parte reexamination, and for good reason. An
`
`ex parte proceeding is fundamentally incompatible with an inter partes review, and
`
`is particularly so here. Consolidating the ex parte reexamination would
`
`fundamentally change the reexamination proceeding from examinational to
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`adjudicatory, and would unlawfully abridge Patent Owner’s statutory right to
`
`conduct the reexamination proceeding with no participation by the reexamination
`
`requester, the same party as the petitioner in the present proceeding. In addition to
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`the statutory hurdles, consideration of any of Petitioner’s “consolidation factors”
`
`counsels against consolidation here. The Motion should be denied.
`
`I.
`
`Consolidating the Ex Parte Reexamination and the IPR for RE 38,551
`Would Violate 35 U.S.C. § 311(b)
`Consolidation of ex parte Reexamination No. 90/013,709 with the present
`
`Inter Partes Review would introduce unpatentability grounds outside the proper
`
`scope of IPR proceedings, as defined by 35 U.S.C. § 311(b). Section 311(b)
`
`explicitly limits IPR proceedings to grounds “that could be raised under section
`
`102 or 103,” and thus excludes “judicially-created” doctrines such as obviousness-
`
`type double patenting (“OTDP”). See, e.g., AbbVie Inc. v. Mathilda and Terence
`
`1
`
`
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`IPR2016-00204
`
`029819.0100-US03
`
`Kennedy Inst. of Rheumatology Trust, 764 F.3d 1366, 1372-73 (Fed. Cir. 2014)
`
`(explaining OTDP is a “court-created doctrine” that stems from § 101’s prohibition
`
`on obtaining more than one patent on the same invention); Eli Lilly & Co. v. Barr
`
`Labs., Inc., 222 F.3d 973, 985 (Fed. Cir. 2000) (noting OTDP is a “judicially-
`
`created doctrine” and that “no explicit statutory basis exists” for it). Because all of
`
`the alleged bases of unpatentability in the ’709 reexamination proceeding are based
`
`on OTDP (see Paper 30, pp. 1–2; Paper 27, p. 3; Ex. 2031, 5:19–6:2; Ex. 1045, pp.
`
`19–20), and because OTDP is not within the scope of § 311(b) (see Paper 27, p. 3),
`
`any consolidation of the reexamination with the present IPR proceeding would
`
`necessarily violate the express scope of the statute.
`
`The authority granted to the PTAB under § 318(a) to “issue a final written
`
`decision with respect to the patentability of any patent claim challenged by the
`
`petitioner and any new claim added under section 316(d)” does not mandate a
`
`different result. Section 318(a) does not provide any authority to violate § 311(b).
`
`Petitioner’s assertion that “an original claim of a patent can be held unpatentable
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`under ODP in a final IPR written decision” notwithstanding § 311(b) (Paper 30, p.
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`4) is wholly unsupported and is directly contradicted by the very cases Petitioner
`
`cites. Both Smith and Ariosa are fully consistent with § 311(b) in addressing the
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`patentability of amended claims on grounds other than § 102 and §103. See Smith
`
`& Nephew, Inc. v. ConvaTec Technologies, Inc., IPR2013-00102, Paper 87 at 50–
`
`2
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`
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`IPR2016-00204
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`029819.0100-US03
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`54 (P.T.A.B. May 29, 2014); Ariosa Diagnostics v. Isis Innovation Limited,
`
`IPR2012-00022, Paper 166 at 47–53 (P.T.A.B. Sept. 2, 2014). Section 311(b) is
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`directed to the grounds under which “claims of a patent” may be challenged and
`
`therefore does not restrict patentability determinations with respect to proposed
`
`amended claims, for which the Board is entrusted with full review of patentability.
`
`35 U.S.C. §§ 316(d), 318(a). In contrast, § 311(b) limits the Board’s review of the
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`“claims of a patent,” which have already undergone a patentability determination
`
`by the Examiner, to grounds “that could be raised under section 102 or 103.”
`
`Granting Petitioner’s Motion here would amount to an end-run around the
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`explicit statutory provisions set forth in § 311(b) for the grounds under which a
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`patentability challenge may be raised. In filing § 103 challenges in the present IPR
`
`proceeding and OTDP claims in the reexamination proceeding, Petitioner was fully
`
`aware of the explicit scope of IPR proceedings set forth in § 311(b). See Petition at
`
`20, n.2. Petitioner’s attempt to now use § 315(d) as a loophole to bypass § 311(b)
`
`should be rejected.
`
`II. Consolidating the Ex Parte Reexamination and the IPR for RE 38,551
`Would Violate the Statute Governing Conduct of the Reexamination
`Consolidating the ex parte reexamination with the present IPR proceeding
`
`would also violate the statute governing conduct of the reexamination proceeding,
`
`and would unlawfully abridge Patent Owner’s statutory rights. The statute
`
`governing ex parte reexamination clearly provides for examination without
`
`3
`
`
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`IPR2016-00204
`
`029819.0100-US03
`
`participation of the requester, the presentation of claim amendments as a matter of
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`right, and for appeal to the Patent Trial and Appeal Board (PTAB) and the Federal
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`Circuit only by the patent owner, with no participation by the requester. In
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`particular, the active participation of the requester ends with a reply to a patent
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`owner’s statement, if filed.1 See 35 U.S.C. §§ 304, 305; see also 37 C.F.R.
`
`§ 1.550(g) (stating “[t]he active participation of the ex parte reexamination
`
`requester ends with the reply,” and “no further submissions on behalf of the
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`reexamination requester will be acknowledged or considered”); 37 C.F.R.
`
`§ 1.560(a) (precluding participation by reexamination requesters in interviews with
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`examiners). Thereafter, the reexamination is conducted ex parte in accordance with
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`“the procedures established for initial examination,” under which the patent owner
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`is “permitted to propose any amendment to his patent and a new claim or claims
`
`thereto.” 35 U.S.C. § 305. Only the patent owner may appeal to the PTAB and the
`
`Federal Circuit; the requester has no right to appeal a reexamination determination.
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`35 U.S.C. § 306.
`
`The conduct of IPR proceedings before the PTAB stands in sharp contrast.
`
`The statute governing inter partes review provides for an adjudicatory proceeding
`
`
`1 Under 35 U.S.C. § 304, the filing of a patent owner statement is optional, and if
`
`none is filed, then the requester may not file a reply.
`
`4
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`
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`IPR2016-00204
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`029819.0100-US03
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`with full participation by both parties, the presentation of claim amendments via
`
`motion in which the patent owner bears the burden of establishing patentability,
`
`and appeal by either party from the PTAB to the Federal Circuit. From beginning
`
`to end, an IPR proceeding is inter partes in nature, and in prescribing the
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`regulations for conduct of inter partes review, the Office made clear that
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`“[c]ommunication regarding a specific proceeding . . . is not permitted unless both
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`parties have an opportunity to be involved in the communication.” 37 C.F.R.
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`§ 42.5(d) (emphasis added). As the Board and the Federal Circuit recognize, “[a]n
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`inter partes review is neither a patent examination nor a patent reexamination,” but
`
`is “a trial, adjudicatory in nature [which] constitutes litigation.” Google Inc. v.
`
`Jongerius Panoramic Techs., LLC, IPR2013-00191, Paper No. 50, p. 4 (P.T.A.B.
`
`Feb. 13, 2014); In re Cuozzo Speed Techs., LLC, 793 F.3d 1268, 1278 (Fed. Cir.
`
`2015), aff’d, 2016 WL 33699425 (U.S. June 20, 2016).
`
`Given the adjudicatory nature of the IPR proceeding, consolidation of the
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`reexamination with the IPR proceeding would fundamentally change the
`
`reexamination
`
`proceeding
`
`from
`
`examinational
`
`to
`
`adjudicatory. Any
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`“consolidation” of the reexamination proceeding with the present IPR proceeding
`
`would introduce participation by the reexamination requester—petitioner in the
`
`present IPR—into the reexamination proceeding in violation of Patent Owner’s
`
`statutory rights.
`
`5
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`
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`IPR2016-00204
`
`029819.0100-US03
`
`Petitioner’s offer to “withdraw” a ground at issue in the reexamination
`
`proceeding, and references to its “burden of proving unpatentability” with respect
`
`to OTDP, highlight the inappropriateness of Petitioner’s request. Paper 30, pp. 7,
`
`10. Petitioner’s attempt to import the full array of participatory rights accorded by
`
`the IPR statute, into the reexamination proceeding, should be rejected.
`
`III. Consolidation Is Discretionary, and Petitioner’s “Consolidation
`Factors” Do Not Support Consolidation Under 35 U.S.C. § 315(d)
`
`The authority granted to the Board under 35 U.S.C. § 315(d) to “determine
`
`the manner in which the inter partes review or other proceeding or matter may
`
`proceed, including providing for stay, transfer, consolidation, or termination . . .”
`
`(§ 315(d)) “is not mandatory, and is instead permissive.” Ford Motor Company v.
`
`Signal IP, Inc., IPR2015-00860, Paper 14 at 2 (P.T.A.B. Nov. 17, 2015). “[T]he
`
`Board is not prohibited from allowing multiple proceedings involving the same
`
`patent to remain as separate proceedings pending before the Office.” Id. This is
`
`particularly true here, where consolidation of the proceedings would violate other
`
`statutory provisions, including § 305 and § 311(b). Contrary to Petitioner’s urging,
`
`a finding that these statutory provisions preclude consolidation of the ex parte
`
`reexamination with the present IPR proceeding would not “turn § 315(d)
`
`consolidation into a ‘white elephant.’” Paper 30, p. 4. Section 315(d) still properly
`
`permits, at least, consolidation of multiple IPR proceedings. See, e.g., Actifio, Inc.
`
`v. Delphix Corp., IPR2015-00025, Paper 69 at 2 (P.T.A.B. Apr. 12, 2016);
`
`6
`
`
`
`IPR2016-00204
`
`029819.0100-US03
`
`Shenzhen Liown Elecs. Co., Ltd. v. Disney Enterprises, Inc., IPR2015-01352,
`
`Paper 15 at 2 (P.T.A.B. Mar. 7, 2016).
`
`The incompatibility of consolidating ex parte reexaminations with inter
`
`partes review is illustrated by the PTAB’s reluctance to order such a consolidation
`
`to date. Petitioner has not pointed to any instance where the Board has exercised its
`
`§ 315(d) authority, as Petitioner is requesting the Board do here. Each time the
`
`Board has addressed the issue, it has declined to consolidate an ex parte
`
`reexamination with an inter partes review. See, e.g., Ford Motor Company,
`
`IPR2015-00860, Paper 14 at 1–2, 5; GEA Process Eng’g, Inc. v. Steuben Foods,
`
`Inc., IPR2014-00043, Paper 35 at 4–5 (P.T.A.B. May 27, 2014).
`
`For these reasons alone, consolidation of the ex parte reexamination with the
`
`present IPR proceeding is improper, and Petitioner’s Motion should be denied.
`
`However, even without the § 305 and § 311(b) statutory hurdles, Petitioner’s
`
`“consolidation factors” nonetheless counsel against consolidation of these
`
`proceedings.
`
`A. There Is No Risk of Inconsistency
`
`While Petitioner raises the general specter of inconsistency, it cannot point
`
`to any real risk of inconsistent findings between the reexamination and present IPR
`
`proceeding. Cf. GEA Process Eng’g, IPR2014-00043, Paper 35 at 4–5 (staying a
`
`reexamination proceeding based on concerns over inconsistencies with an IPR in
`
`7
`
`
`
`IPR2016-00204
`
`029819.0100-US03
`
`claim construction and patentability determinations). Petitioner cannot point to any
`
`risk of inconsistency because there is no overlap in either the legal questions raised
`
`in the two proceedings, or the prior art bases for the patentability challenges.
`
`Obviousness-type double patenting over the ’301 patent is the sole challenge in the
`
`reexamination, whereas § 103 obviousness over Kohn 1991 is the only ground on
`
`which inter partes review has been instituted in the present proceeding. To the
`
`extent that the legal analyses for OTDP and § 103 overlap, the legal determinations
`
`will not because the prior art from which each analysis begins is different.
`
`Compare Paper 19 at 23–24 with Ex. 1045 at 20. Even if an inconsistent
`
`determination in the reexamination proceeding were possible, § 306 provides for
`
`appeal directly to the PTAB, where any such inconsistency may be remedied.
`
`Thus, because there is no overlap in the legal issues or prior art bases between the
`
`reexamination and present IPR, any risk of inconsistency is entirely speculative
`
`and does not support consolidation of the two proceedings.
`
`B. Consolidation Will Not Simplify the Issues
`
`There is no “simplification” to be gained by consolidating the reexamination
`
`and present IPR proceedings because there is no overlap in the legal issues or prior
`
`art bases between the two proceedings. In addition, Petitioner’s assertion that
`
`§ 315(e) estoppel will “eliminate relitigation” (Paper 30 at 7) is misleading and
`
`inaccurate. Section 315(e) would only operate to estop Petitioner (and its real
`
`8
`
`
`
`IPR2016-00204
`
`029819.0100-US03
`
`parties-in-interest or privies) in a future dispute. But any such future litigation is
`
`highly unlikely given that, to Patent Owner’s knowledge, Petitioner has no
`
`marketed products. Moreover, § 315(e) estoppel would not apply to an OTDP
`
`ground because the statute only estops a “ground that the petitioner raised or
`
`reasonably could have raised” during inter partes review, and § 311(b) explicitly
`
`provides that the only grounds that may be raised in an inter partes review are
`
`grounds under § 102 or § 103.
`
`C. Timing Does Not Support Consolidation
`Timing of the proceedings counsels against consolidation because the
`
`reexamination and present IPR are on different timelines, as even Petitioner
`
`acknowledges. Paper 30, p. 9 (“the average pendency of an ex parte reexam is
`
`approximately twice that of an IPR”); see Ford Motor Company, IPR2015-00860,
`
`Paper 14 at 3 (“recognition [that reexamination and IPR have different temporal
`
`restrictions] generally does not encourage consolidation of such proceedings”).
`
`And Petitioner’s accusations of “dilatory tactics2” on Patent Owner’s part are
`
`
`2 Patent Owner’s exercise of its statutory right under 35 U.S.C. § 304 does not
`
`amount to a “dilatory tactic.” Paper 30, p. 8. Petitioner’s accusation is
`
`disingenuous, especially when Petitioner delayed filing its reexamination request
`
`in the first place (see Petition at 20, n.2), and then delayed perfection of its request
`
`
`
`9
`
`
`
`IPR2016-00204
`
`029819.0100-US03
`
`without basis; Patent Owner seeks a determination of patentability on the merits in
`
`accordance with its statutory rights.
`
`D. Consolidation Would Significantly Prejudice Patent Owner
`
`The considerable prejudice to Patent Owner, in abridging its statutory right
`
`to conduct
`
`the reexamination proceeding with no participation by
`
`the
`
`reexamination requester and no burden to demonstrate patentability for any claim
`
`amendments, strongly counsels against consolidation here. See supra Section II.
`
`Moreover, it is Petitioner, not Patent Owner, who seeks settlement. See Ex. 2034
`
`(third Petitioner email regarding settlement despite expressions of no interest).
`
`IV. Conclusion
`
`The Board’s initial inclination not “to consolidate matters here” is correct.
`
`Paper 27, p. 3. The present Motion is nothing more than Petitioner’s end-run
`
`around § 311(b) in order to bring into the present IPR grounds of unpatentability
`
`based upon OTDP. But Congress explicitly excluded such grounds from IPR
`
`proceedings, and the Board has no authority to set the statute aside under the guise
`
`of “consolidation.” The Motion should be denied.
`
`
`
`
`while attempting to extort a settlement. See Exs. 2032, 2033 (email forwarding 30-
`
`day notice to perfect reexamination request, followed by email sending term sheet
`
`despite explicit statement of no interest in settlement).
`
`10
`
`
`
`IPR2016—00204
`
`029819.0100—US03
`
`Dated: July 19, 2016
`
`Respectfully submitted,
`
`COVINGTON & BURLING LLP
`One CityCenter
`850 Tenth Street NW
`Washington, DC 20001
`(202) 662~6000
`
`‘X
`, 3
`
`3:56
`’*
`x.
`
`
`
`
`
`,
`i
`‘fiw
`“xx”
`
`Andrea G. Rerster
`Registration No.: 36,253
`Jennifer L. Robbins
`Registration No.: 61,163
`Enrique D. Longton
`Registration No.: 47,304
`Attorneys for Patent Owner
`
`
`
`IPR2016—O0204
`
`029819.0100—US03
`
`CERTIFICATE OF SERVICE
`
`I hereby certify that on this 19th day of July 2016, the foregoing Patent
`
`Owner’s Opposition to Petitioner’s Motion to Consolidate Reexamination
`
`with Inter Partes Review was served by electronic mail, by agreement of the
`
`parties, on the following counsel of record for Petitioner:
`
`Matthew J. Dowd (MatthewDowd@andrewskurth.com)
`John Murray (JohnMurray@andrewskurth.com)
`Andrews Kurth LLP
`
`1350 I Street, NW, Suite 1100
`Washington DC 20005
`
`Dated: July 19, 2016
`
`
`
`K”
`C ”?‘”ez:’”
`
`:;””‘“‘”“‘*
`
`E
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`,3? 3
`A» ll V
` X er, Esq.
`Andrea G. Re’
`Registration N .36,253
`
`
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