[00:00:00] Speaker 03:
Is Arthrex incorporated against Smith and Nephew incorporated?

[00:00:05] Speaker 03:
Mr. Cho.

[00:00:06] Speaker 04:
Yes, Your Honor.

[00:00:07] Speaker 04:
Thank you.

[00:00:15] Speaker 04:
May it please the court.

[00:00:17] Speaker 04:
I would like to address this in appeal in two sections.

[00:00:21] Speaker 04:
The first section addresses the question of jurisdiction and whether there is jurisdiction to consider the second issue of this case.

[00:00:30] Speaker 04:
which is whether 37 CFR 42.73 has been properly interpreted.

[00:00:36] Speaker 03:
Of course, you can use your time as you wish, but I think that we're willing to concede jurisdiction for the purpose of this argument.

[00:00:44] Speaker 03:
If it turns out that that's incorrect, of course, we'll decide otherwise.

[00:00:50] Speaker 04:
Thank you, Your Honor.

[00:00:50] Speaker 04:
I understand that decision has already been considered en banc in terms of those issues, or let me rephrase.

[00:00:56] Speaker 04:
I'll move on to the second subject, which is the subject of whether

[00:01:00] Speaker 04:
the agency committed plain error or acted in a way that was inconsistent with the regulation.

[00:01:08] Speaker 00:
Could I ask you at the outset, you're not contending that the PTO doesn't have the authority to adopt a regulation providing for a stop-all on the cancellation of a patent or a claim, right?

[00:01:22] Speaker 04:
That is correct.

[00:01:22] Speaker 04:
We are not contending that the Patent Office does not have authority

[00:01:26] Speaker 04:
We're not contending that, Your Honor.

[00:01:28] Speaker 00:
So the question is how to interpret this regulation.

[00:01:31] Speaker 04:
That is correct.

[00:01:33] Speaker 04:
And in that regard, if we look at the plain language of the rule, there is the first part of the rule that provides that the patent owner may elect or may inform the Patent Office that it will pursue an adverse or will request an adverse judgment.

[00:01:50] Speaker 04:
And then there are enumerated actions which constitute

[00:01:56] Speaker 04:
action by the patent owner that constitute that request.

[00:01:59] Speaker 04:
And in this case, the Patent Office disregarded what I consider to be the plain language of the statute, which is that if there's going to be a voluntary disclaimer of the claims, and that occurs prior to trial, then there should be no issue with regards to the entry of an adverse judgment, because the rule specifically says that when there is a voluntary disclaimer in trial,

[00:02:27] Speaker 04:
That is when disclaimer takes place.

[00:02:29] Speaker 00:
Why would that be an appropriate interpretation of the rule given the fact that under subsection one and subsection three, let's take subsection one first, that if you cancel the entire patent, it doesn't make any difference when you do that in the proceeding.

[00:02:48] Speaker 00:
And the rule is pretty explicit about that, isn't it?

[00:02:50] Speaker 04:
That's correct, Your Honor.

[00:02:52] Speaker 04:
And in fact, that actually supports our position because

[00:02:56] Speaker 04:
In those instances, the Patent Office was very specific that it could enter adverse judgment, or those actions would be considered an entry of adverse judgment.

[00:03:07] Speaker 04:
But then when it came to the issue of voluntary disclaimer, it was clear that that would only occur in the trial.

[00:03:15] Speaker 00:
Why would the Patent Office make a distinction between the cancellation of an entire patent

[00:03:22] Speaker 00:
which would create an estoppel whether it happened before or after trial, and the cancellation of an individual claim, where under your theory, there's no estoppel if it happens before trial, but there is an estoppel if it happens after the trial is instituted.

[00:03:42] Speaker 04:
Let me suggest that, of course, I don't know exactly what the Patent Office was thinking, and there's not much in the history to describe that, but I would submit that if you cancel the entire

[00:03:51] Speaker 04:
patent.

[00:03:54] Speaker 04:
Let me just say that in this case, we had two IPRs relating to the same patent.

[00:03:59] Speaker 04:
The first IPR covered claims 1 through 9.

[00:04:02] Speaker 04:
The second IPR covered claims 10 through 11.

[00:04:05] Speaker 04:
And so from my perspective, this is precisely what the rule was intended to cover, was that if somebody wanted to split their IPRs and split up the challenges for those patents, that we would have the freedom to then decide which IPRs we were going to battle.

[00:04:20] Speaker 04:
which IPRs we were not going to battle.

[00:04:22] Speaker 03:
And I think that's an important distinction here because- So your theory is that you accept that you could not sue the same defendant on the disclaimed claims in some of the proceeding.

[00:04:36] Speaker 03:
Is that correct?

[00:04:38] Speaker 03:
Your Honor, I agree- That there would be an estoppel of some sort, at least between these parties, for the disclaimed claims?

[00:04:47] Speaker 04:
I would submit that we are not entitled to assert those disclaimed claims with regards to whether there should be an estoppel effect.

[00:04:55] Speaker 03:
Obviously that is the... Okay, so then the next step that you argue is that nonetheless claims that are not patentably distinct can be obtained in your pending continuation.

[00:05:09] Speaker 03:
And that is correct, Your Honor, and that's... That those same claims then that are not patentably distinct could be asserted against this same defendant

[00:05:17] Speaker 03:
or only against other defendants?

[00:05:20] Speaker 04:
Your Honor, from my perspective and the way I view it is that it should be, the party should be free to assert those claims.

[00:05:29] Speaker 04:
There are, of course, safeguards in place.

[00:05:32] Speaker 04:
The safeguards of this would still have to go through the prosecution, the continuation would still have to go through the prosecution of the patent office.

[00:05:40] Speaker 04:
There are issues of statutory double patenting and there are other issues.

[00:05:44] Speaker 04:
How can it be double patenting if the claims are disclaimed?

[00:05:47] Speaker 04:
Your Honor, it was my understanding, and maybe my misunderstanding, that as long as the claims were issued, that we wouldn't be able to... And if it's double patenting, that's just cured by a terminal disclaimer, is it not?

[00:05:58] Speaker 04:
Not if it's statutory double patenting, as I recall, Your Honor.

[00:06:04] Speaker 04:
But I would submit that when there is a disclaimer, there's a specific giving up of the rights of those particular claims per section, I believe, 253.

[00:06:13] Speaker 03:
So what I hear you're saying is that the effect of this claiming

[00:06:17] Speaker 03:
claims 1 to 9 is that that closes out this particular interaction on this IPR, but has no other adverse effect.

[00:06:28] Speaker 04:
I don't agree with that, Your Honor.

[00:06:30] Speaker 04:
I believe the adverse effect is we would not be able to attain the same claims.

[00:06:33] Speaker 03:
And that's part of the... What claims that are not patentably distinct, you say, are not the same even though they cover the same invention?

[00:06:42] Speaker 04:
Your Honor, if they're not patentably... Well, let's just say that

[00:06:46] Speaker 04:
the question of whether we would be able to obtain those claims, I submit that that's part of, I believe, the regulation itself.

[00:06:55] Speaker 04:
And I don't believe that it's within the discretion of 37.73B, which provides these are the instances in which our action, and of course this all goes to the patent owner's own voluntary actions, it doesn't go to how the

[00:07:14] Speaker 04:
Patent Office should rule unilaterally on our actions.

[00:07:17] Speaker 04:
It goes to whether the patent owner wants to take an action, and of course the statute permits that action, to forego the issue of the IPR.

[00:07:25] Speaker 04:
And if we give the Board discretion to decide these issues, irrespective of in the trial language that's specifically in the rule or otherwise, then in a sense it's a blank check because

[00:07:40] Speaker 04:
If we're patent owners, we're looking at these statutes for guidance as to what actions we should take that may have some consequence, then we should have some understanding of what that effect will be.

[00:07:51] Speaker 04:
But if it's a question of just equity, it's unfair, or it's not right, then the problem arises that patent owners are left at sea.

[00:08:00] Speaker 03:
So what should the action be?

[00:08:01] Speaker 03:
You disclaim all of the claims that have been challenged and that have been instituted?

[00:08:08] Speaker 04:
Correct, Your Honor.

[00:08:10] Speaker 03:
Now what?

[00:08:11] Speaker 03:
And then at that instance... There's no adverse consequence at all, I gather, is your position.

[00:08:17] Speaker 04:
Well, I think there is an adverse consequence in the sense that we have to go back to the patent office.

[00:08:22] Speaker 03:
Is that adverse?

[00:08:23] Speaker 03:
You get the same claims in another case?

[00:08:25] Speaker 04:
I think that would be very challenging from the patent examiner.

[00:08:27] Speaker 03:
Because they can't cite these claims because they're not prior art.

[00:08:31] Speaker 03:
So what can they cite?

[00:08:33] Speaker 03:
Can they say you disclaimed?

[00:08:35] Speaker 03:
That's the same as where we are now.

[00:08:38] Speaker 03:
So you're saying that if you

[00:08:40] Speaker 03:
that the Patent Office, the examiner, cannot cite the fact that you disclaimed the same invention in the IPR.

[00:08:50] Speaker 03:
You say that cannot be cited against the continuing applications.

[00:08:54] Speaker 04:
Your Honor, I would submit that, first of all, the Patent Office would be alerted of these proceedings because of the IES requirements.

[00:09:01] Speaker 00:
Your position is that they can't cite it against you because the fact that it's patentably indistinct is irrelevant.

[00:09:09] Speaker 00:
The cancellation has no effect on these patentably indistinct claims, right?

[00:09:16] Speaker 04:
I guess I read section 253 as requiring us to give up the rights to those particular claims.

[00:09:22] Speaker 02:
Plus there's intervening rights as well, right?

[00:09:25] Speaker 04:
Correct.

[00:09:26] Speaker 02:
So what if you were in district court, for instance, and you decided to disclaim these claims?

[00:09:35] Speaker 02:
Do you think that the patent office could simply

[00:09:39] Speaker 02:
issue an order, canceling the patent?

[00:09:44] Speaker 02:
Say there was no IPR.

[00:09:47] Speaker 04:
What effect would that have?

[00:09:48] Speaker 02:
If the patent office just come right out and say, we heard about this disclaimer in district court, so we're just going to cancel your patent.

[00:09:56] Speaker 04:
And the fact that's a possibility and that's a concern that it would have a chilling effect.

[00:10:00] Speaker 02:
How is that a possibility?

[00:10:01] Speaker 02:
I mean, I think that's an important question.

[00:10:03] Speaker 02:
So because my problem is there's never an instituted IPR here, right?

[00:10:07] Speaker 04:
Oh, my apologies, Your Honor.

[00:10:08] Speaker 02:
There was never an institute at IPR.

[00:10:11] Speaker 02:
So we don't even have an IPR.

[00:10:14] Speaker 02:
We have a petition to institute.

[00:10:16] Speaker 02:
So what if there had been no even petition to institute and you had just claimed these claims somewhere else in some other forum?

[00:10:25] Speaker 02:
Could the Patent Office just decide on its own that it wants to cancel your patent?

[00:10:30] Speaker 04:
It would have the effect of a cancellation because the claims were disclaimed.

[00:10:34] Speaker 02:
Right, but it's not an order from the Patent Office, correct?

[00:10:37] Speaker 04:
That is correct.

[00:10:38] Speaker 02:
All right.

[00:10:39] Speaker 02:
So what my problem is, and maybe this goes back to Judge Dyke's original question, is that the PTAB as a panel, panels of the PTAB have been given authority, have been delegated the authority to conduct IPRs, right?

[00:10:55] Speaker 02:
And they've been delegated the authority to institute IPRs.

[00:10:59] Speaker 02:
I don't know of any place where they've ever been delegated any authority to act outside the confines of an IPR.

[00:11:08] Speaker 02:
But you're saying you're not arguing that.

[00:11:10] Speaker 04:
I'm not arguing that the effect of a disclaimer prior to institution or even prior to the filing of a petition would have an effect.

[00:11:17] Speaker 03:
But don't you have to argue that claims 1 to 9 could not be canceled?

[00:11:22] Speaker 04:
Claims, I'm sorry, Your Honor?

[00:11:25] Speaker 03:
You're not arguing that claims 1 to 9 could not be canceled.

[00:11:30] Speaker 03:
Is that what you're saying?

[00:11:32] Speaker 04:
I'm arguing that claims 1 through 9 have been canceled.

[00:11:37] Speaker 04:
I'm afraid that I'm not quite sure I followed it.

[00:11:38] Speaker 04:
But that it has no adverse effect.

[00:11:41] Speaker 04:
Yes, Your Honor.

[00:11:42] Speaker 04:
That's what we're arguing.

[00:11:43] Speaker 04:
And I think the issue here, and Judge O'Malley brought this point up, which is the Patent Office has delegated the authority to the board to make these determinations.

[00:11:54] Speaker 04:
But the Patent Office itself has promulgated a regulation that on its face suggests that disclaimer

[00:12:00] Speaker 04:
should occur in the trial.

[00:12:02] Speaker 00:
And in effect, we are... Well, not with respect to if the disclaimer of the entire patent occurs.

[00:12:07] Speaker 00:
It's perfectly clear that if that happens before trial, it still happens in the proceeding as defined by the regulations.

[00:12:16] Speaker 00:
The proceeding commences with the filing of the petition, right?

[00:12:25] Speaker 04:
That is correct, Your Honor.

[00:12:26] Speaker 04:
And that's precisely why in the trial,

[00:12:28] Speaker 04:
has so much significance because it distinguishes a particular action from the situation Your Honor spoke about.

[00:12:37] Speaker 03:
So if your continuing applications, the claims that are not patentably distinct are granted, is your position that those claims can then be enforced against this same defendant?

[00:12:51] Speaker 04:
Your Honor, there would be no stopple effect.

[00:12:53] Speaker 04:
And that hypothetical is possible, but I hope that the Patent Office would do its job.

[00:13:00] Speaker 04:
And since there would be the requirement that we disclose these proceedings.

[00:13:05] Speaker 03:
What's doing its job is what?

[00:13:07] Speaker 03:
To allow the claims that are not patentably distinct or not to allow the claims?

[00:13:12] Speaker 04:
Well, Your Honor presumes that we could not have argued this challenge in the first place.

[00:13:17] Speaker 04:
And that's precisely why I believe the Patent Office gave

[00:13:20] Speaker 00:
You want to get claims that are not patentably distinct from the ones that are canceled, right?

[00:13:26] Speaker 04:
Well, Your Honor, that's correct, but I would say sometimes in, let's just take an example since we're talking about hypotheticals, there's a claim language or a claim that exists and for some reason the wording isn't quite right.

[00:13:39] Speaker 04:
And it says nothing about the effect or validity of the patent itself.

[00:13:43] Speaker 04:
It says,

[00:13:44] Speaker 04:
Perhaps these claims should be clarified, and we should have the opportunity to pick and choose the battles that we'd have.

[00:13:51] Speaker 04:
And Your Honor, I recognize that I have about a minute and 23 seconds remaining.

[00:13:56] Speaker 04:
Well, then let's hear from the other side.

[00:14:06] Speaker 03:
Mr. Speed, we have a situation that the drafters of the American VINCE Act didn't get to.

[00:14:15] Speaker 03:
We're right in the middle of all sorts of technicalities, are we not?

[00:14:21] Speaker 01:
I would suggest that we're not dealing with technicalities.

[00:14:26] Speaker 01:
We're talking about jurisdiction at this point on the technicalities.

[00:14:29] Speaker 01:
The St.

[00:14:30] Speaker 01:
Jude decision is quite clear that the decision under 1295A4 are only final written decisions under 318A.

[00:14:37] Speaker 00:
They say that 1295 and 318 are coextensive, right?

[00:14:43] Speaker 00:
But St.

[00:14:44] Speaker 00:
Jude wasn't dealing with the kind of situation that we have here.

[00:14:48] Speaker 01:
Correct.

[00:14:49] Speaker 01:
They were not dealing with the precise type of decision that the Patent Office or the Board issued in this case.

[00:14:55] Speaker 01:
They were dealing with a non-institution decision.

[00:14:57] Speaker 01:
But the appeal bar doesn't apply here, right?

[00:15:00] Speaker 01:
Correct.

[00:15:00] Speaker 01:
But I would submit that St.

[00:15:01] Speaker 01:
Jude, the reasoning of St.

[00:15:03] Speaker 01:
Jude, they walked through the entire American Events Act.

[00:15:07] Speaker 01:
They looked first at 318, which provides that the Board must issue a final decision on the patentability of the claims.

[00:15:14] Speaker 01:
They then looked at 319, which is

[00:15:16] Speaker 01:
titled appeal, and it states that a party dissatisfied with the final written decision under 318A may appeal pursuant to 141C.

[00:15:25] Speaker 02:
Under your reading of St.

[00:15:27] Speaker 02:
Jude, there would never be the ability to appeal from this kind of a cancellation, whether it occurs before institution or after institution, right?

[00:15:37] Speaker 01:
There would not be jurisdiction under 1295A4.

[00:15:40] Speaker 02:
So that nobody gets to review a cancellation of a patent?

[00:15:46] Speaker 01:
A cancellation of a patent if mandamus could be an appropriate vehicle in certain circumstances where the cancellation isn't based on a discretionary regulation as we've been talking about today.

[00:15:58] Speaker 01:
Under mandamus, Arthrex has the burden to prove that they have a clear and indisputable right to the relief that they seek.

[00:16:06] Speaker 02:
But you're saying there is never any appeal whether this occurs pre-institution or post-institution from this kind of cancellation of the patent?

[00:16:16] Speaker 01:
I would submit that that is the implication of the St.

[00:16:20] Speaker 01:
Jude decision.

[00:16:21] Speaker 00:
But on its face, 1295 would apply here, right?

[00:16:25] Speaker 00:
Quite apart from the possible notion that it has to be coextensive with 318.

[00:16:31] Speaker 00:
Let's put that aside.

[00:16:32] Speaker 00:
On the face of it, 1295 seems to apply to this situation, doesn't it?

[00:16:37] Speaker 02:
It says we have appeal over a decision.

[00:16:40] Speaker 01:
Correct.

[00:16:42] Speaker 01:
And absent St.

[00:16:43] Speaker 01:
Jude,

[00:16:44] Speaker 01:
there may be some strength to that argument.

[00:16:45] Speaker 01:
But St.

[00:16:46] Speaker 01:
Jude read that statute and said that it's most naturally read to refer precisely to the board's decisions under 318A on the merits of the inter-parties review after it conducts the proceeding that the director... But that was only in the context of considering the appeal bar.

[00:17:02] Speaker 02:
In other words, a final decision versus a decision to institute.

[00:17:08] Speaker 01:
I would respectfully disagree.

[00:17:11] Speaker 01:
The appeal bar was cited in the St.

[00:17:12] Speaker 01:
Jude decision, but it was cited after the panel had walked through the 318, 319, and 141C.

[00:17:18] Speaker 01:
They essentially pointed to the appeal bar as icing on the cake that supported their interpretation of decisions in light of the AIA.

[00:17:28] Speaker 01:
And subsequent decisions of both this court and, notably, the closer decision

[00:17:32] Speaker 01:
have clarified the role of the appeal bar of the 314D.

[00:17:36] Speaker 01:
And the role of the appeal bar is to limit the issues that can be reviewed when you have the proper appellate vehicle ID.

[00:17:43] Speaker 03:
On your theory that there's no appeal, all of the results favorable to the patent owner that Mr. Cho has been presenting would flow without any debate.

[00:17:56] Speaker 03:
And there you would be worse off than perhaps if there's

[00:18:01] Speaker 03:
uh, some sort of action, uh, reviewing finality.

[00:18:07] Speaker 01:
They would, I would agree that if, I agree that this court should dismiss this appeal and that the act, the order should remain, which would have an adverse judgment of, um, estoppel effect on, on Arthur's ability to- It would be an estoppel.

[00:18:23] Speaker 03:
It's over.

[00:18:24] Speaker 03:
There's no estoppel.

[00:18:25] Speaker 03:
The claims were removed before decision.

[00:18:28] Speaker 03:
It can't be an estoppel without a decision.

[00:18:32] Speaker 01:
Well, so Arthrex's action in disclaiming its claims would have resulted in the Patent Office making a decision that is unreviewable in the 1295A that their decision to disclaim the claims can be construed as a request for adverse judgment.

[00:18:49] Speaker 03:
And the implication of that... Is it not appealable?

[00:18:53] Speaker 01:
Does it count?

[00:18:55] Speaker 01:
It's not appealable via 1295A.

[00:18:58] Speaker 01:
I also don't believe it would be appealable through mandamus.

[00:19:01] Speaker 00:
I think that's a hard position.

[00:19:03] Speaker 00:
Maybe you want to talk about the merits of this?

[00:19:08] Speaker 02:
As to the merits, you can see that several other PTAB panels have said they have no authority to take this kind of action.

[00:19:17] Speaker 02:
Isn't that correct?

[00:19:18] Speaker 02:
Under the regulation or otherwise?

[00:19:21] Speaker 01:
There are no decisions that Arthur extended to this court that hold that.

[00:19:25] Speaker 01:
I'm not aware of any decision that says that.

[00:19:28] Speaker 01:
There were seven decisions that the parties submitted to the board down below, and that the board identified its decision.

[00:19:33] Speaker 01:
Three, GlobalTel, Hospera, and another Smith and Neffi case versus Bonutti.

[00:19:39] Speaker 01:
There was a pre-trial disclaimer of the claims, and the PTAB entered adverse judgment.

[00:19:44] Speaker 01:
So those three panels clearly interpreted the regulation to permit adverse judgment in precisely this scenario.

[00:19:49] Speaker 01:
There were then two cases, FCA and the RPX decision, where the panel decided not to enter adverse judgment in light of a pre-institution disclaimer.

[00:19:58] Speaker 01:
But in each of those decisions, the board said it had the authority to do so.

[00:20:02] Speaker 01:
It was just exercising its discretion.

[00:20:03] Speaker 02:
But let me ask you this.

[00:20:04] Speaker 02:
How could the board have authority to act outside the institution of an IPR?

[00:20:09] Speaker 02:
The director has argued to us that the director delegated the authority to the PTAP to institute.

[00:20:17] Speaker 02:
And this court has accepted the proposition that the director had the authority to delegate that.

[00:20:24] Speaker 02:
And the Federal Register of the Board also says she has delegated the authority to the PTAB to conduct IPRs.

[00:20:31] Speaker 02:
In this instance, there has never been an IPR instituted.

[00:20:35] Speaker 02:
So how could they have authority to act outside the context of an instituted IPR?

[00:20:40] Speaker 02:
Even if the director could, how could the PTAB?

[00:20:45] Speaker 01:
Under 37 CFR 4273B, the adverse judgment statute or regulation provides that a party may request judgment

[00:20:54] Speaker 01:
during a proceeding.

[00:20:55] Speaker 01:
A proceeding is defined in the regulation as beginning with a preliminary proceeding, which is once the petition is filed, up to the institution decision, and then there's a trial, which is the institution decision to the final written decision.

[00:21:07] Speaker 01:
So a proceeding, which is what the regulation is referring to, begins the moment a petition is filed.

[00:21:14] Speaker 01:
So they were acting within the confines of an IPR proceeding.

[00:21:18] Speaker 01:
We simply weren't at the point of a trial.

[00:21:20] Speaker 01:
And I would submit that the regulation doesn't require

[00:21:24] Speaker 01:
that the trial actually occur before the board has the authority to construe a patent order that disclaims all their claims as a request.

[00:21:32] Speaker 03:
That's not the question.

[00:21:33] Speaker 03:
The question is, does it require that institution occur?

[00:21:37] Speaker 01:
I believe that the board below properly read the regulation to provide that it is required to enter adverse judgment when one of the four delineated events occur.

[00:21:47] Speaker 01:
But that it has the authority to enter adverse judgment

[00:21:51] Speaker 03:
So the question is, is the regulation in accordance with the statute?

[00:21:56] Speaker 01:
Right.

[00:21:57] Speaker 02:
And the statute, the relevant- And doesn't our Shaw decision specifically say that estoppel can only apply with respect to claims as to which institution actually occurred?

[00:22:11] Speaker 01:
So that estoppel applies when there has been a final written decision.

[00:22:15] Speaker 02:
Well, no.

[00:22:16] Speaker 02:
It says as to on grounds on which institution has occurred.

[00:22:22] Speaker 01:
Correct.

[00:22:23] Speaker 01:
So my understanding of the Shaw decision would be to distinguish claims that were considered during the actual trial proceeding from claims that were never instituted in the first instance.

[00:22:35] Speaker 01:
If the claims that were not instituted in the first instance in Shaw had been disclaimed pre-trial, then we might have a scenario where the board could have found that that pre-trial disclaimer was a request for adverse judgment.

[00:22:52] Speaker 01:
I apologize if I haven't answered your question fully.

[00:22:53] Speaker 01:
My understanding of Shaw is that's addressing what happens when a party, a petitioner loses when you... But Shaw specifically says we don't even consider issues of estoppel until the point of institution, correct?

[00:23:07] Speaker 01:
Under the petitioner estoppel provision, but we're dealing here... Different kind of estoppel.

[00:23:12] Speaker 01:
Right.

[00:23:12] Speaker 01:
This is a patent on estoppel provision, which is under 47.73d.

[00:23:19] Speaker 01:
It's 47.73b that provides for adverse judgment against a patent owner, and specifically says that the patent owner may take actions during the proceeding that the board will construe as a request for adverse judgment.

[00:23:33] Speaker 01:
And as far as the, I know in the briefing it's suggested that there's some inconsistency or disagreement between panels before the board, but there simply isn't.

[00:23:41] Speaker 01:
There are the three decisions where the adverse judgment was entered.

[00:23:46] Speaker 01:
There's RPX and CDETEC.

[00:23:48] Speaker 01:
or RPICS and FCA, where the board found that it had authority to enter adverse judgment.

[00:23:54] Speaker 01:
And then you have the two cases, Cool Systems IT and Tandis Flooring, where there was a pretrial disclaimer claims and there was no adverse judgment entered.

[00:24:05] Speaker 01:
But in those decisions, the adverse judgment regulation was never mentioned by the board or the parties.

[00:24:10] Speaker 01:
So there's no guidance from those cases as to how that panel would have interpreted this regulation if presented with that issue.

[00:24:17] Speaker 01:
So every panel that has reviewed this regulation has reviewed it in the way that Smith and Nephew suggested below and that the board below found.

[00:24:25] Speaker 01:
And no one has read it in the way that Arthrox is considering the statute.

[00:24:29] Speaker 01:
So I respectfully submit that that suggests that the

[00:24:33] Speaker 01:
board's reading of its own regulation is at least reasonable and certainly not plainly erroneous.

[00:24:39] Speaker 01:
And then the application of that regulation to the facts of this case, where you have a patent owner that has disclaimed all its claims in the face of a strong petition and admittedly has pending continuation applications, which we've heard today they want to procure patentably indistinct claims so that my client will be held under threat of potential future litigation over those claims.

[00:25:03] Speaker 01:
those claims.

[00:25:05] Speaker 01:
As the board found below, we are entitled to finality repose on that.

[00:25:09] Speaker 01:
Those claims and all other claims are patently indistinct from those claims.

[00:25:14] Speaker 01:
And there was some reference to a second petition on claims 10 and 11.

[00:25:17] Speaker 01:
Just for full disclosure, that petition was instituted.

[00:25:20] Speaker 01:
Same prior art and similar arguments that were raised in the first petition on claims 1 through 9.

[00:25:25] Speaker 01:
And we recently received a final decision canceling claims 10 and 11 under that same prior art.

[00:25:33] Speaker 01:
Unless there's any further questions from the panel.

[00:25:36] Speaker 03:
Thank you, Mr. Speaker.

[00:25:41] Speaker 04:
Mr. Cho?

[00:25:41] Speaker 04:
Your Honors, I will be very, very brief, because I have to be brief.

[00:25:46] Speaker 04:
In that regard, I'd like to address the issue about the authority of the Board to enter an adverse judgment.

[00:25:53] Speaker 04:
The statute or the regulation makes very clear that that authority comes from the patent owner itself.

[00:26:00] Speaker 04:
because the patent owner must request or take action that could be construed as such a request.

[00:26:05] Speaker 04:
We clearly did not do that here.

[00:26:08] Speaker 04:
Nobody disputes that we, in fact, stated very clearly that we are not seeking or requesting adverse judgment.

[00:26:14] Speaker 04:
Without that request, the patent office or board did not have the authority to enter adverse judgment.

[00:26:20] Speaker 04:
I would also submit that, again, the timing by the patent office is critical here because the patent office says in subsection two,

[00:26:30] Speaker 04:
in the trial and in no other subsection of that statute is that stated.

[00:26:37] Speaker 04:
I think we are entitled to rely on that as a matter of notice and the regulations of the Patent Office.

[00:26:43] Speaker 04:
And I think to rule otherwise is an abuse of discretion.

[00:26:48] Speaker 04:
And I think that's the issue we have here, Your Honor.

[00:26:51] Speaker 04:
We have this notice.

[00:26:52] Speaker 04:
It says these are the instances when adverse judgment will enter.

[00:26:56] Speaker 04:
And the Patent Office indicated in the trial has some significance.

[00:27:00] Speaker 04:
That's all your honor.

[00:27:02] Speaker 04:
Any questions for Mr. Cho?

[00:27:04] Speaker 03:
Thank you, thank you both.