PTAB Closes in on The “First-to-Derive” in The “First-to-File” Era

March, 27th, 2018

Categories: Articles, Blog Tags: litigation, patent, PTAB, USPTO

By Benjamin N. Luehrs

On March 21, 2018, the Patent Trial and Appeal Board (PTAB) entered uncharted waters when it instituted, for the first time, derivation proceedings between Andersen Corp. and GED Integrated Solutions, Inc., concerning a patent directed to sealing insulating glass units (U.S. Pat. No. 9,428,953) (“the ‘953 Patent”).

The “first to file” provisions of the American Invents Act (AIA) went into effect nearly 5 years ago in March 2013. Previously, in the “first to invent” system, inventors who were beaten to the patent office by another could prove an earlier invention date by filing a declaration to that effect. Such luxuries are no longer available under the AIA. However, Congress included derivation proceedings in the AIA to preserve an inventor’s chance at protecting their inventions if the invention is stolen (or derived) by another. In short, “derivation addresses originality—who invented the subject matter at issue.” Andersen Corp. v. GED Integrated Solutions, Inc., DER2017-00007, 2018 WL 1444870, at *3 (PTAB Mar. 21, 2018) (“Andersen”).

Until last Wednesday, inventors had never successfully convinced the PTAB to initiate a derivation proceeding. The threshold for doing so is relatively high. A patent applicant (a petitioner) must demonstrate “substantial evidence” that she conceived of the derived invention and that she communicated the substance of the claimed invention to the deriving inventor.[1] In Andersen, inventor Sammy H. Oqendo (“Oqendo”) became the first petitioner to meet the PTAB’s derivation standard for institution.

Oqendo is an employee of Andersen who alleges that he invented the embodiments in claims 1-22[2] of the ’953 Patent, which is directed to a window spacer frame assembly. Before Oqendo purportedly conceived of his invention, spacer frames for insulating glass units had three identical corners and a seam in a fourth corner. Oqendo determined that the fourth corner’s seam was responsible for seal failures, so he moved the seam inwards to an “offset seam location,” which he captured in a prototype and CAD drawing:

Andersen at *6. In part, Andersen argues in its petition that the “offset seam location” falls within the invention it claims was derived by GED.

To prove Oquendo’s conception of the invention, Andersen provided a “detailed mapping of record evidence to all of the recited elements of claims 1-22” of ’953 Patent. To prove Oquendo’s communication to GED, Andersen submitted evidence showing (1) that Oqendo disclosed his invention to employees of GED at a March 2009 Glass Symposium; and (2) that GED obtained detailed drawings of the invention from Oquendo. Notably, Andersen purposefully made claims in its own patent application (U.S. Appln. No. 15/058,862) identical to claims 1-22 of the ’953 Patent to demonstrate that its invention was the same or substantially the same as ’953 Patent.

Pursuant to the foregoing, the Board determined that Andersen had met its burden to institute claims 1-22 of the ‘953 Patent. This was the first such institution determination issued by the PTAB. GED must respond to the petition by June 13, and Andersen was reply by September 5. Oral argument is set (tentatively) for November 14.

Practice Pointers:

• In the right circumstances, derivation proceedings remain a possible option to recover inventions that were derived or stolen by another.[3]
• Ensure that your employees are taking detailed notes during R&D, especially when communicating with persons outside your offices.
• If you’re considering petitioning for derivation proceedings, consider first amending your current patent application to match the claims of the derivation patent. Doing so will help you show that the inventions are “the same or substantially the same” as required by C37 C.F.R.§ 42.405(a)(2).

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[1] “Substantial evidence” means evidence that “a reasonable person might accept as adequate to support a conclusion.” Falkner v. Inglisn, 448 F.3d 1357, 1363 (Fed. Cir. 2006).

[2] Technically, and as noted by the Board, Andersen successfully instituted 22 separate derivations, as each implicated claim is patently distinct.

[3] Note that derivation petitions must be filed within 1-year of the publication of the derived patent, or within 1-year of the publication of the derived patent application, whichever is earlier. 35 U.S.C. § 135(a).