The Patent Act requires that “claims particularly point out and distinctly claim the subject matter which the inventor or a joint inventor regards as the invention.” 35 U.S.C. § 112(b). Claims can be tested for indefiniteness over the life cycle of a claim, first for patentability during examination by the USPTO, and later for invalidity while the patent is enforceable. The CAFC had raised a high bar for an indefiniteness challenge. Since 2001, the CAFC analyzed indefiniteness under what was known as the “insolubly ambiguous” standard. Exxon Research and Engineering Co. v. US, 265 F. 3d 1371, 1376 (Fed. Cir. 2001) (“what we have asked is that the claims be amenable to construction, however difficult that task may be. If a claim is insolubly ambiguous, and no narrowing construction can properly be adopted, we have held the claim indefinite”).
On June 2, 2014, in Nautilus v. Biosig, the Supreme Court rejected this standard as failing to fulfill the definiteness requirement of 35 U.S.C. §112, ¶2. Slip op. No. 13-369. Regardless of whether the test was in practice being applied so as to follow the requirements of the statute, the wording of the old test was thought by the Court to “breed lower court confusion.” Slip op. at 12. The case was remanded to the district court with instructions to consider whether the claims, when read in light of the specification and prosecution history, fail to inform, with “reasonable certainty,” the scope of the claims to one of skill in the relevant art.
Regardless of how the new guidance is interpreted by the CAFC and district courts, it is clear that the bar for finding indefiniteness has been lowered. This lower standard provides a new line of attack to invalidate patents both in district court and before the USPTO. It may be particularly useful as a tool against non-practicing entities in defending an infringement allegation. The CAFC recently held in In re Packard that the standard for indefiniteness is even lower pre-issuance. 2014 WL 1775996 (Fed. Cir. May 6, 2014). The court upheld the USPTO standard in the Manual of Patent Examining Procedure (MPEP) that “[a] claim is indefinite when it contains words or phrases whose meaning is unclear.” MPEP § 2173.05(e). With this change in the standard for indefiniteness comes a change in the balance of considerations between the different venues where claims can be invalidated. It is useful to review these venues in light of Nautilus.
As an alternative to the district courts, the America Invents Act (AIA) introduced new proceedings, two of which allow for the invalidation of claims based on indefiniteness: Post Grant Review (PGR) and the Transitional Program for Covered Business Method Patents (CBM). The legislative history of the AIA indicates that Congress intended these two new proceedings to be quick and cost effective alternatives to district court litigation. As such, PGR and CBM allow for a challenge to the validity of one or more claims in an issued U.S. patent on any ground under 35 U.S.C. § 282(b)(2) or (3) (i.e., indefiniteness, novelty, obviousness, written description, and enablement). The other two proceedings available to invalidate a patent before the USPTO, Inter Partes Review (IPR) and ex-parte reexamination—are limited to anticipation and obviousness grounds and may only be filed on the basis of prior art consisting of patents and printed publications.
Both PGRs and CBMs have certain limits to their broad challenge capability: PGRs are available only for patents filed on or after March 16, 2013 and must be filed within a nine months of the issuance or reissuance of the patent, and CBMs only apply to certain business method patents. Since Nautilus, and in light of Packard, it has been unclear what standard will be used by the PTAB to determine indefiniteness. In one CBM, decided on June 23, 2014, the PTAB stated a standard that: “The scope of the claims must be sufficiently definite to inform the public of the bounds of the protected invention, i.e., what subject matter is covered by the exclusive rights of the patent.” Hulu, LLC v. Intertainer, Inc., Case No. CBM2014-00053 (PTAB June 23, 2014) (citing Halliburton Energy Servs. Inc. v. M–I, LLC, 514 F.3d 1244, 1249 (Fed. Cir. 2008)). In Hulu, applying this standard, the PTAB found that it was not more likely than not that the claims at issue were indefinite. It is worth noting that Nautilus was not cited and the “reasonable certainty” standard was not explicitly applied.
All USPTO post-grant proceedings have advantages for the challenger of deciding invalidity based on a preponderance of the evidence (no presumption of validity), and using the broadest reasonable construction to interpret claims. When the evidentiary and claim construction advantages of PGRs and CBMs are combined with the new Nautilus standard, a challenger wishing to challenge eligible patents based on indefiniteness may now find these proceedings to be an even better venue for invalidity challenges.