The August 2018 Update to the PTAB Trial Practice Guide added guidance regarding the Patent Trial and Appeal Board’s (“the Board”) discretion under 35 U.S.C. § 325(d) to deny institution of an AIA trial when the same or substantially the same prior art or arguments were previously presented to the United States Patent and Trademark Office.  This statutory provision allows the Board to balance the petitioner’s desire to be heard against the interest of the patent owner in avoiding duplicative challenges to its patent.  The Board recently exercised its § 325(d) discretion in denying institution of IPR2018-00919 (Paper 13).

IPR2018-00919 was initiated by petitioner Merial, Inc., an animal health company headquartered in Duluth, Georgia.  As of 2017, Merial is a wholly owned subsidiary of Boehringer Ingelheim GmbH.  Merial filed its petition on April 13, 2018, challenging patent owner Intervet International B.V.’s U.S. Patent No. 8,008,001 (“the ’001 patent”).

The ’001 patent, issued on August 30, 2011, relates to a method for protecting piglets against porcine circovirus type 2 (“PCV-2”), which is linked to multiple diseases, poor growth rate, failure to thrive, and wasting.  According to the patent, conventional vaccines based on inactivated whole PCV-2 virus were inadequate because PCV-2 does not replicate to high titers in cell culture.  Moreover, the presence of maternally derived antibodies (“MDAs”) was known to interfere with vaccination, and although alternative vaccines based on recombinant antigens derived from PCV-2 were known, testing for those vaccines was conducted on specific pathogen-free pigs that did not have MDAs.  Intervet argued that the ’001 patent solved these problems by providing a method for protecting piglets against PCV-2 even in the presence of MDAs—specifically, the ’001 patent claims a method of protecting MDA positive piglets against PCV-2  infection by administering a vaccine comprising at least 20 micrograms/dose of recombinant open reading frame-2 (“ORF-2”) protein of PCV-2.

Merial relied on references Jestin, Blanchard, and Meng, either alone or in combination, as rendering obvious claims 1-6 of the ’001 patent, and Merial further relied on references Pinelli-Saavedra and Rijke for the additional limitations of claims 7 and 8.  Intervet filed a Patent Owner Preliminary Response, arguing first that Merial’s petition should be denied under § 325(d) because Merial “failed to raise a single argument that ha[d] not been considered and overcome during prosecution,” and arguing second that the petition should otherwise be denied on the merits.

Following Intervet’s Preliminary Response, Merial requested authorization from the Board to file a Reply to address Intervet’s arguments regarding § 325(d).  The Board denied Merial’s request, however, finding that no good cause existed because Intervet’s arguments regarding § 325(d) were reasonably foreseeable and yet Merial chose not to address the issue in the petition.

The Board exercised its discretion under § 325(d) to deny institution without ever reaching the merits of Merial’s obviousness arguments.  In accordance with the Trial Practice Guide August 2018 Update, the Board evaluated whether to exercise its discretion under § 325(d) by weighing the non-exclusive factors set forth in Becton, Dickinson & Co. v. B. Braun Melsungen AG, IPR2017-01586, slip op. at 17-18 (Paper 8) (PTAB Dec. 15, 2017) (informative):

i) The similarities and material differences between the asserted art and the prior art involved during examination;

ii) The cumulative nature of the asserted art and the prior art evaluated during examination;

iii) The extent to which the asserted art was evaluated during examination, including whether the prior art was the basis for rejection;

iv) The extent of the overlap between the arguments made during examination and the manner in which Petitioner relies on the prior art or Patent Owner distinguishes the prior art;

v) Whether Petitioner has pointed out sufficiently how the Examiner erred in its evaluation of the asserted prior art;

vi) The extent to which additional evidence and facts presented in the petition warrant reconsideration of the prior art or arguments.

The Board found that many of the same prior art references asserted by Merial were considered by the Examiner during prosecution of the ’001 patent, as Merial’s base references (Jestin, Blanchard, and Meng) are three of only ten references cited on the face of the patent.  Also, claims were rejected based on Jestin during prosecution of the ’001 patent, and claims were rejected based on Blanchard during prosecution of a parent application to the ’001 patent.  Moreover, the Board determined that Meng was cumulative because Merial did not explain how Meng differed from Jestin or Blanchard but rather relied on similar disclosures from Meng, Jestin, and Blanchard.

The Board then found that during prosecution the Examiner substantively evaluated Jestin, Blanchard, and a cumulative reference Van Woensel and used these references as the bases for rejections that the Applicants overcame.  Additionally, the Board found “no substantive difference between the Examiner’s findings during prosecution and [Merial’s] arguments.”  For example, just as the Examiner had argued that piglets utilized in Jestin’s studies inherently carried MDAs, Merial also argued that the limitation requiring MDA positive piglets is inherent in the disclosures of Jestin, Blanchard, or Meng.  The Board agreed with Intervet that “the Petition does not present new arguments.”

Importantly, Merial did not discuss § 325(d) in its Petition. Merial also did not discuss the prosecution history of the ’001 patent and thus failed to point out whether or how the Examiner erred in evaluating the prior art.  Merial did offer expert testimony that was not considered during prosecution.  However, given the substantial overlap of prior art and arguments between the Merial’s petition and the prosecution of the ’001 patent, this expert testimony was not a sufficient reason for the Board to reconsider those assertions.

Ultimately, the Board found that the Becton Dickinson factors weighed in favor of denying institution.  Decisions such as this are good news for patent owners, who wish to avoid the cost of challenges based on recurring prior art and arguments.  This decision also provides lessons to would-be petitioners who wish to assert at least some prior art or argument that was previously presented to the Patent Office.  For example, to avoid a discretionary denial of institution under § 325(d), consider asserting at least some new and non-cumulative art and pointing out how the Examiner erred in evaluating any previously presented prior art.  Also, be advised to address the issue in the petition rather than betting on a Reply to the Patent Owner Preliminary Response.