[Federal Register Volume 83, Number 197 (Thursday, October 11, 2018)]
[Rules and Regulations]
[Pages 51340-51359]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-22006]


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DEPARTMENT OF COMMERCE

Patent and Trademark Office

37 CFR Part 42

[Docket No. PTO-P-2018-0036]
RIN 0651-AD16


Changes to the Claim Construction Standard for Interpreting 
Claims in Trial Proceedings Before the Patent Trial and Appeal Board

AGENCY: United States Patent and Trademark Office, Department of 
Commerce.

ACTION: Final rule.

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SUMMARY: The United States Patent and Trademark Office (``USPTO'' or 
``Office'') revises the claim construction standard for interpreting 
claims in inter partes review (``IPR''), post-grant review (``PGR''), 
and the transitional program for covered business method patents 
(``CBM'') proceedings before the Patent Trial and Appeal Board 
(``PTAB'' or ``Board''). In particular, the Office is replacing the 
broadest reasonable interpretation (``BRI'') standard such that claims 
shall now be construed using the same claim construction standard that 
is used to construe the claim in a civil action in federal district 
court. This rule reflects that the PTAB in an AIA proceeding will apply 
the same standard applied in federal courts to construe patent claims. 
The Office also amends the rules to add that any prior claim 
construction determination concerning a term of the claim in a civil 
action, or a proceeding before the International Trade Commission 
(``ITC''), that is timely made of record in an IPR, PGR, or CBM 
proceeding will be considered.

DATES: 
    Effective Date: The changes in this final rule take effect on 
November 13, 2018.
    Applicability Date: This rule is effective on November 13, 2018 and 
applies to all IPR, PGR and CBM petitions filed on or after the 
effective date.

FOR FURTHER INFORMATION CONTACT: Michael Tierney and Jacqueline Wright 
Bonilla, Vice Chief Administrative Patent Judges, by telephone at (571) 
272-9797.

SUPPLEMENTARY INFORMATION: 

Executive Summary

    Purpose: This final rule revises the rules for IPR, PGR, and CBM 
proceedings that implemented provisions of the Leahy-Smith America 
Invents Act (``AIA'') providing for trials

[[Page 51341]]

before the Office, by replacing the BRI standard for interpreting 
unexpired patent claims and substitute claims proposed in a motion to 
amend with the same claim construction standard that would be used to 
construe the claim in a civil action under 35 U.S.C. 282(b). The rule 
adopts the same claim construction standard used by Article III federal 
courts and the ITC, both of which follow Phillips v. AWH Corp., 415 
F.3d 1303 (Fed. Cir. 2005) (en banc), and its progeny. Under the final 
rule, the PTAB will apply in an AIA proceeding the same standard 
applied in federal courts to construe patent claims. This final rule 
also amends the rules to add a new provision which states that any 
prior claim construction determination in a civil action or proceeding 
before the ITC regarding a term of the claim in an IPR, PGR, or CBM 
proceeding will be considered if that determination is timely filed in 
the record of the IPR, PRG or CBM proceeding.
    Summary of Major Provisions: The Office is using almost six years 
of historical data, user experiences, and stakeholder feedback to 
further shape and improve PTAB proceedings, particularly IPR, PGR, and 
CBM proceedings (``AIA proceedings''). As part of the Office's 
continuing efforts to improve AIA proceedings, the Office now changes 
the claim construction standard applied in AIA proceedings involving 
unexpired patent claims and substitute claims proposed in a motion to 
amend. The Supreme Court of the United States has endorsed the Office's 
ability to choose an approach to claim construction for AIA 
proceedings. Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2144-46 
(2016) (``That [the appropriate claim construction standard for AIA 
proceedings] is a question that Congress left to the particular 
expertise of the Patent Office.'').
    In the notice of proposed rulemaking, the Office sought comments on 
the Office's proposed changes to the claim construction standard used 
for interpreting unexpired patent claims and substitute claims proposed 
in a motion to amend. Changes to the Claim Construction Standard for 
Interpreting Claims in Trial Proceeding Before the Patent Trial and 
Appeal Board, 83 FR 21221 (May 9, 2018).
    The Office received a total of 374 comments, including 297 comments 
from individuals, 45 comments from associations, 1 comment from a law 
firm, and 31 comments from corporations. The majority of the comments 
were supportive of changing the claim construction standard along the 
lines set forth in the proposed rule. For example, major bar 
associations, industry groups, patent practitioners, legal professors 
and scholars, and individuals all supported the change. The 
commentators also provided helpful insights and suggested revisions, 
which have been considered in developing this final rule. While there 
was broad support expressed for using the federal court standard set 
forth in the proposed rule, some commentators indicated that they were 
opposed to the change. The Office appreciates the thoughtful comments 
representing a diverse set of views from the various public stakeholder 
communities. Upon careful consideration of the public comments, taking 
into account the effect of the rule changes on the economy, the 
integrity of the patent system, the efficient administration of the 
Office, and the ability of the Office to timely complete instituted 
proceedings, the Office adopts the proposed rule changes (with minor 
deviations in the rule language, as discussed below). Any deviations 
from the proposed rule are based upon a logical outgrowth of the 
comments received.
    In particular, this final rule fully adopts the federal court claim 
construction standard, in other words, the claim construction standard 
that is used to construe the claim in a civil action under 35 U.S.C. 
282(b), which is articulated in Phillips and its progeny. This rule 
states that the PTAB in an AIA proceeding will apply the same standard 
applied in federal courts to construe patent claims. The claim 
construction standard adopted in this final rule also is consistent 
with the same standard that the Office has applied in interpreting 
claims of expired patents and soon-to-be expired patents. See, e.g., 
Wasica Fin. GmbH v. Cont'l Auto. Sys., Inc., 853 F.3d 1272, 1279 (Fed. 
Cir. 2017) (noting that ``[t]he Board construes claims of an expired 
patent in accordance with Phillips . . . [and] [u]nder that standard, 
words of a claim are generally given their ordinary and customary 
meaning''). This final rule also revises the rules to add that the 
Office will consider any prior claim construction determination 
concerning a term of the claim that has been made in a civil action, or 
a proceeding before the ITC, if that prior claim construction is timely 
made of record in an AIA proceeding.
    Costs and Benefits: This final rule is significant under Executive 
Order 12866 (Sept. 30, 1993).

Background

    On September 16, 2011, the AIA was enacted into law (Pub. L. 112-
29, 125 Stat. 284 (2011)), and within one year, the Office implemented 
rules to govern Office practice for AIA proceedings, including IPR, 
PGR, CBM, and derivation proceedings pursuant to 35 U.S.C. 135, 316 and 
326 and AIA sec. 18(d)(2). See Rules of Practice for Trials Before the 
Patent Trial and Appeal Board and Judicial Review of Patent Trial and 
Appeal Board Decisions, 77 FR 48612 (Aug. 14, 2012); Changes to 
Implement Inter Partes Review Proceedings, Post-Grant Review 
Proceedings, and Transitional Program for Covered Business Method 
Patents, 77 FR 48680 (Aug. 14, 2012); Transitional Program for Covered 
Business Method Patents--Definitions of Covered Business Method Patent 
and Technological Invention, 77 FR 48734 (Aug. 14, 2012). Additionally, 
the Office published a Patent Trial Practice Guide to advise the public 
on the general framework of the regulations, including the procedure 
and times for taking action in each of the new proceedings. See Office 
Patent Trial Practice Guide, 77 FR 48756 (Aug. 14, 2012).
    Previously, in an effort to gauge the effectiveness of the rules 
governing AIA proceedings, the Office led a nationwide listening tour 
in April and May of 2014. During the listening tour, the Office 
solicited feedback on how to make AIA proceedings more transparent and 
effective by adjusting the rules and guidance to the public where 
necessary. To elicit even more input, in June of 2014, the Office 
published a Request for Comments in the Federal Register and, at public 
request, extended the period for receiving comments to October 16, 
2014. See Request for Comments on Trial Proceedings Under the America 
Invents Act Before the Patent Trial and Appeal Board, 79 FR 36474 (June 
27, 2014) (``Request for Comments''). The Request for Comments asked 
seventeen questions on ten broad topics, including a general catchall 
question, to gather public feedback on any changes to AIA proceedings 
that might be beneficial. See Request for Comments, 79 FR at 36476-77. 
At least one question was directed to the claim construction standard.
    Upon receiving comments from the public and carefully reviewing the 
comments, the Office published two final rules in response to the 
public feedback on this request for comments. In the first final rule, 
the Office changed the existing rules to, among other things: (1) 
Increase the page limit for patent owner's motion to amend by ten pages 
and allow a claims appendix to be filed with the motion; and (2) 
increase the page limit for petitioner's reply to patent owner's 
response by ten pages. Amendments to the Rules of Practice for

[[Page 51342]]

Trials Before the Patent Trial and Appeal Board, 80 FR 28561 (May 19, 
2015). In the second final rule, the Office changed the existing rules 
to, among other things: (1) Allow new testimonial evidence to be 
submitted with a patent owner's preliminary response; (2) allow a claim 
construction approach that emulates the approach used by a district 
court for claims of patents that will expire before entry of a final 
written decision; (3) replace page limits with word count limits for 
major briefing; and (4) add a Rule 11-type certification for papers 
filed in a proceeding. Amendments to Rules of Practice for Trials 
Before the Patent Trial and Appeal Board, 81 FR 18750 (April 1, 2016).
    The Office last issued a rule package regarding AIA proceedings on 
April 1, 2016. This final rule was based on comments received during a 
comment period that opened on August 20, 2015 (only a month after the 
Federal Circuit's July 2015 decision in the appeal of the first IPR 
filed, Cuozzo Speed Technologies, LLC v. Lee) and that closed on 
November 18, 2015. At that time, the appeal of the Federal Circuit's 
decision in Cuozzo had not yet been decided by the Supreme Court (it 
was decided on June 20, 2016). Due to the life cycle of AIA trial 
proceedings and appeals, the comments received during this 2015 comment 
period came when few Federal Circuit decisions had been issued, and 
there had been no decisions on AIA appeals from the Supreme Court. From 
2016 to present there has been a six-fold increase in the number of 
opinions relating to AIA proceedings issued by the Federal Circuit as 
compared to the prior 2012-2015 time frame. Additionally, since the 
last rule package, the Office has continued to receive extensive 
stakeholder feedback requesting adoption of the district court claim 
construction standard for all patents challenged in AIA proceedings. 
Many of the comments are based on case law and data that was not 
available when the comments to the last rule package were received in 
FY 2015. Further, recent studies not available at the time of the 2016 
rule package support the concerns expressed by stakeholders regarding 
the unfairness of using a different claim construction standard in AIA 
proceedings than that used by the district courts. See Niky R. Bagley, 
Treatment of PTAB Claim Construction Decisions: Aspiring to Consistency 
and Predictability, 32 Berkeley Tech. L.J. 315, 355 (2018) (the 
application of a different standard may encourage a losing party to 
attempt a second bite at the apple, resulting in a waste of the 
parties' and judicial resources alike); Kevin Greenleaf et al., How 
Different are the Broadest Reasonable Interpretation and Phillips Claim 
Construction Standards 15 (2018), available at http://www.ipo.org/wp-content/uploads/2018/07/BRI-v-Phillips-Final.pdf (prospect of differing 
claim constructions for same claim term is troubling and these 
differences can determine the outcome of a case); Laura E. Dolbow, A 
Distinction without a Difference: Convergence in Claim Construction 
Standards, 70 V and L. Rev. 1071, 1103 (2017) (maintaining the separate 
standards presents problems with inefficiency, lack of uniformity, and 
decreased confidence in patent rights).

Claim Construction Standard

    Prior to this rulemaking, the PTAB construed unexpired patent 
claims and proposed substitute claims in AIA proceedings using the BRI 
standard. The BRI standard differs from the standard used in federal 
courts and the ITC, which construe patent claims in accordance with the 
principles that the United States Court of Appeals for the Federal 
Circuit articulated in Phillips.
    Although the BRI standard is consistent with longstanding agency 
practice for patents in examination, the fact that the Office uses a 
claim construction standard in AIA proceedings that is different from 
that used by federal courts and the ITC means that decisions construing 
the same or similar claims in those fora may be different from those in 
AIA proceedings and vice versa. Minimizing differences between claim 
construction standards used in the various fora will lead to greater 
uniformity and predictability of the patent grant, improving the 
integrity of the patent system. In addition, using the same standard in 
the various fora will help increase judicial efficiency overall. One 
study found that 86.8% of patents at issue in AIA proceedings also have 
been the subject of litigation in the federal courts, and the Office is 
not aware of any change in this percentage since this study was 
undertaken. Saurabh Vishnubhakat, Arti K. Rai & Jay P. Kesan, Strategic 
Decision Making in Dual PTAB and District Court Proceedings, 31 
Berkeley Tech. L.J. 45 (2016) (available at https://ssrn.com/abstract=2731002). The high percentage of overlap between AIA 
proceedings and district court litigation favors using a claim 
construction standard in AIA proceedings that is the same as the 
standard used by federal courts and the ITC. That is, the scope of an 
issued patent should not depend on the happenstance of which court or 
governmental agency interprets it, at least as far as the objective 
rules go. Employing the same standard for AIA proceedings and district 
courts improves uniformity and predictability as it allows the 
different fora to use the same standards in interpreting claims. See, 
e.g., Automated Packaging Sys., Inc. v. Free Flow Packaging Int'l, 
Inc., No. 18-cv-00356, 2018 WL 3659014, at *3 (N.D. Cal. Aug. 2, 2018) 
(finding that a party's failure to advance a particular claim 
construction during an IPR proceeding ``is not probative to Markman 
claim construction'' because material differences exist between the 
broadest reasonable interpretation and claim construction under 
Phillips); JDS Techs., Inc. v. Avigilon USA Corp., No. 15-cv-10385, 
2017 WL 4248855, at *6 (E.D. Mich. Jul. 25, 2017) (holding that 
arguments in IPR submissions are not relevant to claim construction 
because ``the USPTO's broadest reasonable construction standard of 
claim construction has limited significance in the context of patent 
infringement, which is governed by the more comprehensive scrutiny and 
principles required by Phillips and its progeny'').
    In addition, having AIA proceedings use the same claim construction 
standard that is applied in federal courts and ITC proceedings also 
addresses the concern that potential unfairness could result from using 
an arguably broader standard in AIA proceedings. According to some 
patent owners, the same claim construction standard should apply to 
both a validity (or patentability) determination and an infringement 
determination. Because the BRI standard potentially reads on a broader 
universe of prior art than does the Phillips standard, a patent claim 
could potentially be found unpatentable in an AIA proceeding on account 
of claim scope that the patent owner would not be able to assert in an 
infringement proceeding. For example, even if a competitor's product 
would not be found to infringe a patent claim (under the Phillips 
standard) if it was sold after the patent's effective filing date, the 
same product nevertheless could potentially constitute invalidating 
prior art (under the BRI standard) if publicly sold before the patent's 
effective filing date. As noted by one study, the possibility of 
differing constructions for the same claim term is troubling, 
especially when claim construction takes place at the same time in 
parallel district court proceedings and USPTO proceedings. Greenleaf at 
3.
    The Office's goal is to implement a balanced approach, providing 
greater predictability and certainty in the patent

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system. The Office has carefully considered the submitted comments in 
view of ``the effect of [the] regulation on the economy, the integrity 
of the patent system, the efficient administration of the Office, and 
the ability of the Office to complete timely the proceedings in 
promulgating regulations.'' 35 U.S.C. 316(b) and 326(b). Under 35 
U.S.C. 316(a)(4) and 326(a)(4), the Office shall prescribe regulations 
establishing and governing IPR, PGR, and CBM proceedings and the 
relationship of such reviews to other proceedings, including civil 
actions under 35 U.S.C. 282(b). Under 35 U.S.C. 316(a)(2) and 
326(a)(2), the Office must prescribe regulations ``setting forth the 
standards for the showing of sufficient grounds to institute a 
review.'' Congress intended these administrative trial proceedings to 
provide ``quick and cost effective alternatives'' to litigation in the 
courts. H.R. Rep. No. 112-98, pt. 1, at 48 (2011), as reprinted in 2011 
U.S.C.C.A.N. 67, 78; see also id. at 40 (``[The AIA] is designed to 
establish a more efficient and streamline patent system that will 
improve patent quality and limit unnecessary and counterproductive 
litigation costs.''). The claim construction standard could be outcome 
determinative. PPC Broadband, Inc. v. Corning Optical Comm'ns RF, LLC, 
815 F.3d 734, 740-42 (Fed. Cir. 2016) (noting that ``[t]his case hinges 
on the claim construction standard applied--a scenario likely to arise 
with frequency''); see also Rembrandt Wireless Techs., LP v. Samsung 
Elecs. Co., 853 F.3d 1370, 1377 (Fed. Cir. 2017) (noting that ``the 
Board in IPR proceedings operates under a broader claim construction 
standard than the federal courts''); Google LLC v. Network-1 Techs., 
Inc., No. 2016-2509, 2018 WL 1468370, at *5 (Fed. Cir. Mar. 26, 2018) 
(nonprecedential) (holding that ``[i]n order to be found reasonable, it 
is not necessary that a claim be given its correct construction under 
the framework laid out in Phillips.''). Using the same claim 
construction standard as the standard applied in federal courts would 
``seek out the correct construction--the construction that most 
accurately delineates the scope of the claim invention--under the 
framework laid out in Phillips.'' PPC Broadband, 815 F.3d at 740.
    In this final rule, the Office revises the rules to provide that a 
patent claim, or a claim proposed in a motion to amend, shall be 
construed using the same claim construction standard that would be used 
to construe the claim in a civil action under 35 U.S.C. 282(b), 
including construing the claim in accordance with the ordinary and 
customary meaning of such claim as understood by one of ordinary skill 
in the art and the prosecution history pertaining to the patent. This 
rule reflects that the PTAB in an AIA proceeding will apply the same 
standard applied in federal courts to construe patent claims. This 
change replaces the BRI standard for construing unexpired patent claims 
and proposed substitute claims in IPR, PGR, and CBM proceedings with 
the federal court claim construction standard, which is articulated in 
Phillips and its progeny.
    Under the amended rules as adopted in this final rule, the Office 
will construe patent claims and proposed substitute claims in an IPR, 
PGR, or CBM proceeding by taking into account the claim language 
itself, the specification, the prosecution history of the patent, and 
extrinsic evidence, among other things, as briefed by the parties. 
Having the same claim construction standard for both the original 
patent claims and proposed substitute claims will reduce the potential 
for inconsistency in the interpretation of the same or similar claim 
terms. Additionally, using the federal court claim construction 
standard is appropriate because, among other things, amendments 
proposed in AIA proceedings are required to be narrowing, are limited 
to a reasonable number of substitute claims, and are required to 
address patentability challenges asserted against the original patent 
claims. Using the same claim construction standard for interpreting 
both the original and amended claims also avoids the potential of added 
complexity and inconsistencies between PTAB and federal court 
proceedings, and this allows, among other things, the patent owner to 
understand the scope of the claims and more effectively file motions to 
amend. Additionally, having the same construction will reduce the 
potential for situations where a claim term of an original patent claim 
is construed one way under the federal court standard and yet the very 
same or similar term is construed a different way under BRI where it 
appears in a proposed substitute claim.
    The Office will apply the standard used in federal courts, in other 
words, the claim construction standard that would be used to construe 
the claim in a civil action under 35 U.S.C. 282(b), which is 
articulated in Phillips. This rule reflects that the PTAB in an AIA 
proceeding will apply the same standard applied in federal courts to 
construe patent claims. For example, claim construction begins with the 
language of the claims. Phillips, 415 F.3d at 1312-14. The ``words of a 
claim are generally given their ordinary and customary meaning,'' which 
is ``the meaning that the term would have to a person of ordinary skill 
in the art in question at the time of the invention, i.e., as of the 
effective filing date of the patent application.'' Id. at 1312-13. The 
specification is ``the single best guide to the meaning of a disputed 
term and . . . acts as a dictionary when it expressly defines terms 
used in the claims or when it defines terms by implication.'' Id. at 
1321 (internal quotation marks omitted). Although the prosecution 
history ``often lacks the clarity of the specification and thus is less 
useful for claim construction purposes,'' it is another source of 
intrinsic evidence that can ``inform the meaning of the claim language 
by demonstrating how the inventor understood the invention and whether 
the inventor limited the invention in the course of prosecution, making 
the claim scope narrower than it would otherwise be.'' Id. at 1317. 
Extrinsic evidence, such as expert testimony and dictionaries, may be 
useful in educating the court regarding the field of the invention or 
helping determine what a person of ordinary skill in the art would 
understand claim terms to mean. Id. at 1318-19. However, extrinsic 
evidence in general is viewed as less reliable than intrinsic evidence. 
Id.
    Additionally, to the extent that federal courts and the ITC apply 
the doctrine of construing claims to preserve their validity as 
described in Phillips, the Office will apply this doctrine in those 
rare circumstances in AIA proceedings. Phillips, 415 F.3d at 1327-28. 
As the Federal Circuit recognized in Phillips, this doctrine is ``of 
limited utility.'' Id. at 1328. Federal courts have not applied that 
doctrine broadly and have ``certainly not endorsed a regime in which 
validity analysis is a regular component of claim construction.'' Id. 
at 1327. The doctrine of construing claims to preserve their validity 
has been limited to cases in which ``the court concludes, after 
applying all the available tools of claim construction, that the claim 
is still ambiguous.'' Id. (quoting Liebel-Flarsheim Co. v. Medrad, 
Inc., 358 F.3d 898, 911 (Fed. Cir. 2004)). Moreover, the Federal 
Circuit ``repeatedly and consistently has recognized that courts may 
not redraft claims, whether to make them operable or to sustain their 
validity.'' Rembrandt Data Techs., LP v. AOL, LLC, 641 F.3d 1331, 1339 
(Fed. Cir. 2011); see also MBO Labs., Inc. v. Becton, Dickinson & Co., 
474 F.3d 1323, 1332 (Fed. Cir. 2007) (noting that ``validity 
construction

[[Page 51344]]

should be used as a last resort, not first principle'').
    When construing claims in IPR, PGR, and CBM proceedings, the Office 
will take into account the prosecution history that occurred previously 
at the Office, including before an examiner during examination, 
reissue, reexamination, and prior AIA proceedings. Aylus Networks, Inc. 
v. Apple Inc., 856 F.3d 1353, 1361 (Fed. Cir. 2017) (``Because an IPR 
proceeding involves reexamination of an earlier administrative grant of 
a patent, it follows that statements made by a patent owner during an 
IPR proceeding can be considered during claim construction and relied 
upon to support a finding of prosecution disclaimer.''). This will also 
include prosecution before an examiner in a related application where 
relevant (Trading Technologies Intern., Inc. v. Open E Cry, LLC, 728 
F.3d 1309 (Fed. Cir. 2013)) and any argument made on appeal of a 
rejection before the grant of the patent for which review is sought, as 
those arguments are before the examiner when the decision to allow an 
application is made (see TMC Fuel Injection System, LLC v. Ford Motor 
Co., 682 Fed. Appx. 895 (Fed. Cir. 2017)).
    During an AIA proceeding, the patent owner may file a motion to 
amend an unexpired patent to propose a reasonable number of substitute 
claims, but the proposed substitute claims ``may not enlarge the scope 
of the claims of the patent or introduce new matter.'' 35 U.S.C. 316(d) 
and 326(d); 37 CFR 42.121(a)(2) and 42.221(a)(2); see also Aqua Prods., 
Inc. v. Matal, 872 F.3d 1290, 1306 (noting that ``[t]he patent owner 
proposes an amendment that it believes is sufficiently narrower than 
the challenged claim to overcome the grounds of unpatentability upon 
which the IPR was instituted''). As discussed above, and among other 
things, having the same claim construction standard for both the 
original patent claims and proposed substitute claims will reduce the 
potential for inconsistency in the interpretation of the same or 
similar claim terms.
    The Office does not expect that this rule will result in direct 
costs to applicable entities. The Office's understanding is informed 
partly by the PTAB's experience in applying Phillips in some AIA trials 
(as noted herein, PTAB has used Phillips for AIA trials concerning 
expired patents since 2012 and for AIA trials concerning soon-to-be-
expired patents since 2016). In the PTAB proceedings that are currently 
conducted using the Phillips standard, PTAB applies the same 
procedures--including the same page limits and other briefing 
requirements--as in the PTAB proceedings that use the BRI standard. In 
other words, the PTAB currently uses the same regulations, procedures, 
and guidance for both types of AIA trials: i.e., for both the AIA 
trials that use the BRI standard as well as those AIA trials 
(concerning expired and soon-to-expire patents) that use the Phillips 
standard. These are found in the Code of Federal Regulations (at 37 CFR 
part 42) and on USPTO's website, including at the following page where 
USPTO has links to the relevant regulations as well as the Trial 
Practice Guide that informs the public of standard practices before 
PTAB during AIA trials: https://www.uspto.gov/patents-application-process/patent-trial-and-appeal-board/resources. Because these are used 
now for trials under both BRI and Phillips, USPTO does not need to 
revise these procedures and guidance to implement the change set forth 
in this final rule, and does not need to make regulatory changes other 
than those set forth in this final rule.
    Moreover, PTAB has not found that parties to these AIA proceedings 
under Phillips require expanded page limits or otherwise incur more 
expense in their AIA trials than parties in AIA proceedings under BRI. 
The USPTO's experience is that arguments under Phillips are not more 
complicated or more lengthy than arguments under the BRI standard. 
Rather, both standards are familiar to patent practitioners appearing 
before the USPTO and district courts. Consequently USPTO expects that 
these proceedings utilizing the Phillips standard will operate 
procedurally in much the same way as BRI proceedings using the BRI 
standard, that they will cost USPTO and parties no more to conduct, and 
that they will be completed within the statutory deadline. In sum, the 
direct result of USPTO changing the claim construction standard argued 
in some AIA trials from one well-known standard to another well-known 
(as noted, a standard already used in some AIA trials) will not have 
direct economic impacts.
    Given the fact that 86.8% of PTAB proceedings have been the subject 
of litigation in Federal court, where parties are already using the 
Phillips standard, the Office reasonably anticipates expanding the use 
of the Phillips standard to all AIA trials should result in parties 
realizing some efficiency in the legal work required for their PTAB 
proceedings. Not only will applying the federal court claim 
construction standard in AIA proceedings lead to greater consistency 
with the federal courts and the ITC, where such consistency will lead 
to greater certainty as to the scope of issued patent claims, but it 
will also help achieve the goal of increasing judicial efficiency and 
eliminate arguments relating to different standards across fora. The 
Office has not increased the page limits of briefs for the AIA trials 
that currently use Phillips, and the paperwork burden associated with 
briefings for trials is covered by the current information collections 
based on the current page limits, thus the overall cost burden on 
respondents is not expected to change. It is possible that this rule 
may produce a slight reduction in the indirect costs as a result of 
improving efficiency by reducing wasted effort in conducting 
duplicative efforts in construing claims. For example, in some cases 
there may be savings in legal fees because the parties may be able to 
leverage work done in the district court. Using the same claim 
construction standard across the fora would increase efficiency, as 
well reduce cost and burden because parties would only need to focus 
their resources to develop a single set of claims construction 
arguments. In summary, given the Office's experience with existing PTAB 
proceedings currently conducted using the Phillips standard and the 
efficiencies that may be realized by having consistency between all AIA 
trials and the standard use in federal court litigation, the Office 
does not expect that this rule change will impose costs on parties.

Implementation

    The changes to the claim construction standard will apply to 
proceedings where a petition is filed on or after the effective date of 
the final rule. The Office will apply the federal court claim 
construction standard, in other words, the claim construction standard 
that would be used to construe the claim in a civil action under 35 
U.S.C. 282(b), which is articulated in Phillips, to construe patent 
claims and proposed substitute claims in AIA proceedings in which trial 
has not yet been instituted before the effective date of the final 
rule. The Office will continue to apply the BRI standard for construing 
unexpired patent claims and proposed substitute claims in AIA 
proceedings where a petition was filed before the effective date of the 
final rule.
    As to comments received regarding filing a prior claim construction 
determination, parties should submit the prior claim construction 
determination by a federal court or the ITC in an AIA proceeding as 
soon as that determination becomes available. Preferably, a prior claim 
construction determination should be submitted with the petition, 
preliminary response, or

[[Page 51345]]

response, with explanations. See the response to comment 37 below for 
more information.

Discussion of Specific Rules

    Title 37 of the Code of Federal Regulations, part 42, is amended as 
follows:
    Sections 42.100, 42.200, and 42.300: Sections 42.100(b), 42.200(b), 
and 42.300(b) are amended to replace the first sentence with the 
following: A claim of a patent, or a claim proposed in a motion to 
amend, shall be construed using the same claim construction standard 
that would be used to construe the claim in a civil action under 35 
U.S.C. 282(b), including construing the claim in accordance with the 
ordinary and customary meaning of such claim as understood by one of 
ordinary skill in the art and the prosecution history pertaining to the 
patent. This revision replaces the BRI standard for construing 
unexpired patent claims and proposed substitute claims during an IPR, 
PGR, or CBM proceeding with the same claim construction standard that 
is used in federal courts and ITC proceedings. As discussed above, the 
Office will apply the standard used in federal courts and the ITC, 
which construe patent claims in accordance with the principles that the 
Federal Circuit articulated in Phillips. This rule reflects that the 
PTAB in an AIA proceeding will apply the same standard applied in 
federal courts to construe patent claims. The Office will construe 
patent claims and proposed substitute claims based on the record of the 
IPR, PGR, or CBM proceeding, taking into account the claim language 
itself, specification, and prosecution history pertaining to the 
patent, as well as relevant extrinsic evidence, all as in prevailing 
jurisprudence of Article III courts. The Office will take into account 
the prosecution history that occurred previously in proceedings at the 
Office prior to the IPR, PGR, or CBM proceeding at issue, including in 
another AIA proceeding, or before an examiner during examination, 
reissue, and reexamination. As in a district court proceeding, the 
parties should point out the specific portions of the specification, 
prosecution history, and relevant extrinsic evidence they want 
considered, and explain the relevancy of any such evidence to the 
arguments they advance. Each party bears the burden of providing 
sufficient support for any construction advanced by that party.
    The Office has considered using different claim construction 
standards for IPR, PGR, and CBM proceedings, but, for consistency, the 
Office adopts the same claim construction to be applied in all IPR, 
PGR, and CBM proceedings. By maintaining consistency among the various 
proceedings, the integrity, predictability and reliability of the 
patent system is thus enhanced.
    Sections 42.100(b), 42.200(b), and 42.300(b) are also amended to 
state that ``[a]ny prior claim construction determination concerning a 
term of the claim in a civil action, or a proceeding before the [ITC], 
that is timely made of record in the . . . proceeding will be 
considered.'' Under this provision, the Office will consider any prior 
claim construction determination in a civil action or ITC proceeding if 
a federal court or the ITC has construed a term of the involved claim 
previously using the same standard, and the claim construction 
determination has been timely made of record in the IPR, PGR, or CBM 
proceeding.
    Sections 42.100(b), 42.200(b), and 42.300(b) are further amended by 
deleting the second and third sentences, eliminating the procedure for 
requesting a district court-type claim construction approach for a 
patent expiring during an IPR, PGR, or CBM proceeding. Such a procedure 
is no longer needed because the Office will use the same claim 
construction standard that is used in federal courts and ITC 
proceedings uniformly for interpreting all claims in an IPR, PGR, or 
CBM proceeding.

Response to Comments

    The Office received a total of 374 written submissions of comments 
from intellectual property organizations, businesses, law firms, legal 
professors and scholars, patent practitioners, and others. The comments 
provided support for, opposition to, and diverse recommendations on the 
proposed rules. The large majority of the comments were supportive of 
changing the claim construction standard along the lines proposed in 
the proposed rule. For example, major bar associations, industry 
groups, patent practitioners, legal professors and scholars, and 
individuals supported the change.
    The Office appreciates the thoughtful comments, and has considered 
and analyzed the comments thoroughly. All of the comments are posted on 
the PTAB website at https://www.uspto.gov/patents-application-process/patent-trial-and-appeal-board/comments-changes-claim-construction.
    The Office's responses address the comments that are directed to 
the proposed changes set forth in the notice of proposed rulemaking. 83 
FR 21221. Any comments directed to topics that are beyond the scope of 
the notice of proposed rulemaking will not be addressed at this time.

Uniformity, Predictability, and Certainty

    Comment 1: Most comments strongly supported the proposed rules that 
adopt the Phillips claim construction standard for interpreting claims 
in IPR, PGR, and CBM proceedings (``AIA proceedings''), harmonizing the 
claim construction standard between AIA proceedings before the PTAB and 
the proceedings before federal courts and the ITC. For example, most of 
the comments noted that this rule change should lead to greater 
consistency with the federal courts and ITC, and such consistency will 
lead to greater certainty as to the scope of issued patent claims. The 
comments also indicated that the rule change will promote a balanced 
approach, providing greater predictability and certainty in the patent 
system, which will, in turn, increase judicial efficiency and reduce 
economic waste. The comments further explained that adopting the 
Phillips standard will potentially provide for more accurate claim 
constructions and reduce incentives for parallel-track litigation and 
increase efficiency between fora.
    Responses: The Office agrees with these comments. Under the amended 
rules, as adopted in this final rule, the Office will construe a claim 
using the same claim construction standard that would be used to 
construe the claim in a civil action under 35 U.S.C. 282(b), aligning 
the claim construction standard used in AIA proceedings with the 
standard used in federal courts and ITC proceedings. As noted by the 
commentators, the rule change will lead to greater consistency and 
harmonization with the federal courts and the ITC and lead to greater 
certainty and predictability in the patent system. We further agree 
this will increase judicial efficiencies between PTAB and other fora. 
For example, several trade associations and corporations commented that 
the use of the same claim construction standard will reduce duplication 
of efforts by parties and by the various tribunals. This is important 
because, as one study indicated, there is significant overlap between 
AIA proceedings and district court litigation. Saurabh Vishnubhakat, 
Arti K. Rai & Jay P. Kesan, ``Strategic Decision Making in Dual PTAB 
and District Court Proceedings,'' 31 Berkeley Rec. L.J. 45 (2016), 
https://ssrn.com/abstract=2731002. As suggested by the authors of the 
study, the application of the same standard of claim construction by 
the PTAB, federal courts, and the ITC would increase efficiency as it 
would

[[Page 51346]]

enhance the ability of federal courts and the ITC to rely upon PTAB 
claim constructions in subsequent proceedings. Id. at 81.
    Comment 2: Some comments opposed the proposed rule changes, arguing 
that Congress intended the PTAB to use the BRI standard in AIA 
proceedings, Congress has declined to change the claim construction 
standard, the Office should wait until Congress changes the claim 
construction standard, and the BRI standard is appropriate for the 
reasons provided by the Office in the initial AIA proceeding final rule 
in 2012 (77 FR at 48697-99), the 2016 final rule (81 FR at 18752), and 
the government briefs in Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 
2131 (2016) and Oil States Energy Services, LLC v. Greene's Energy 
Group, LLC, 138 S. Ct. 1365 (2018). Another comment suggested that the 
Office has previously taken the position in Cuozzo that the history, 
congressional intent, amendments, and statutory framework of the AIA 
support the BRI in AIA proceedings. A few comments requested that, if 
the Office adopts the proposed changes, the Office should implement 
procedures that will safeguard the AIA's goal of improving patent 
quality and minimize unfairness to the parties. Some of the comments 
suggested that the proposal is arbitrary and capricious, and the Office 
did not provide adequate notice, explanation, or evidence and should 
issue a new proposed rule.
    Response: The Office appreciates the thoughtful comments. Since the 
publication of the second final rule in 2016, the Director has 
considered the significant experience the Office has now had with its 
almost six years of AIA proceedings. The Office also now has the 
benefit of several additional years of Federal Circuit decisions, 
resulting in hundreds of additional decisions that were not available 
during the first several years of AIA implementation. This additional 
experience, and recent studies, support the numerous concerns expressed 
by stakeholders with the use of BRI, and that compelling reasons exist 
to apply the same standard in AIA proceedings as that used in district 
court.
    The Supreme Court has endorsed the Office's ability to choose an 
approach to claim construction for AIA proceedings. Cuozzo, 136 S. Ct. 
at 2142-46 (``That is a question that Congress left to the particular 
expertise of the Patent Office.''). Congress did not expressly set 
forth a claim construction standard in the statute, but rather deferred 
to the Office's expertise to select the appropriate standard for 
construing claims in AIA proceedings. Id. (noting that ``neither the 
statutory language, its purpose, [nor] its history suggest that 
Congress considered what standard the agency should apply when 
reviewing a patent claim in inter partes review'').
    Notably, the statutory provision set forth in 35 U.S.C. 316(a)(4) 
grants the Office authority to issue ``regulations . . . establishing 
and governing inter partes review under this chapter and the 
relationship of such review to other proceedings under this title.'' 
For PGR and CBM proceedings, 35 U.S.C. 326(a)(4) contains a similar 
provision. Furthermore, under 35 U.S.C. 316(a)(2) and 326(a)(2), the 
Office must prescribe regulations ``setting forth the standards for the 
showing of sufficient grounds to institute a review.'' In prescribing 
regulations under 35 U.S.C. 316(a) and 326(a), and among other things, 
the Director has considered ``the effect of any such regulation on the 
economy, the integrity of the patent system, the efficient 
administration of the Office, and the ability of the Office to timely 
complete proceedings instituted under this chapter,'' in accordance 
with 35 U.S.C. 316(b) and 326(b). In addition, the Director has 
carefully considered all of the comments received. As stated in the 
notice of proposed rulemaking, and with all of this information in 
mind, the Office's goal is to implement a fair and balanced approach, 
providing greater predictability and certainty in the patent system. 
This, in turn, implements the congressional intent of the AIA. H.R. 
Rep. No. 112-98, pt. I at 48 (2011), as reprinted in 2011 U.S.C.C.A.N. 
67, 78; see also id. at 40 (``[The AIA] is designed to establish a more 
efficient and streamlined patent system that will improve patent 
quality and limit unnecessary and counterproductive litigation 
costs.'').
    Prior to this final rule, the PTAB already has been applying the 
principles articulated in Phillips and its progeny for interpreting 
claims of expired patents and soon-to-be-expired patents in AIA 
proceedings. Using this standard for interpreting all other claims will 
result in a uniform standard for all claims under review in AIA 
proceedings before the PTAB, in federal court litigations, and at the 
ITC. Significantly, as noted by some of the comments, applying the 
federal court claim construction standard in AIA proceedings will lead 
to greater consistency with the federal courts and the ITC, and such 
consistency will lead to greater certainty as to the scope of issued 
patent claims, and will help achieve the goal of increasing judicial 
efficiency and eliminate arguments relating to different standards 
across fora, which will lead to cost savings for all litigants. As one 
commenter observed, the adoption of the federal court claim 
construction standard is consistent with ``uniform interpretation of 
the patent laws,'' which is a well-recognized goal of the patent system 
as it allows the strength of patents to be meaningfully and positively 
predicted. Hearings on H.R. 6033, H.R. 6934, H.R. 3806 and H.R. 2414, 
Before the Subcomm. on Courts, Civil Liberties and the Admin. of 
Justice of the House Comm. on the Judiciary, 96th Cong., 797 (1980).
    The Office recognizes that in some respects AIA proceedings serve a 
different purpose than that of litigation in the federal courts. 
Cuozzo, 136 S. Ct. at 2143-44. For example, Congress intended AIA 
proceedings to provide ``quick and cost effective alternatives'' to 
litigation in the courts, as well as to ``provide a meaningful 
opportunity to improve patent quality and restore confidence in the 
presumption of validity that comes with issued patents in court.'' H.R. 
Rep. No. 112-98, pt. I at 48 (2011), as reprinted in 2011 U.S.C.C.A.N. 
67, 78; see also id. at 40 (``[The AIA] is designed to establish a more 
efficient and streamlined patent system that will improve patent 
quality and limit unnecessary and counterproductive litigation 
costs.''). The changes in the proposed rule will better effect these 
purposes, for example by reducing costs associated with duplicative 
proceedings, and improving efficiency by reducing wasted effort.
    As to the comment pointing to prior arguments advanced in 
connection with the Cuozzo case, the Supreme Court expressly rejected 
the argument that the history, congressional intent, amendments, and 
statutory framework of the AIA required the use of BRI in AIA 
proceedings: ``Finally, neither the statutory language, its purpose, or 
its history suggest that Congress considered what standard the agency 
should apply when reviewing a patent claim in inter partes review.'' 
Cuozzo, 136 S. Ct. at 2142-46. The Court further held that such 
decisions were left to the sound discretion of the Office: ``[W]e do 
not decide whether there is a better alternative as a policy matter. 
That is a question that Congress left to the particular expertise of 
the Patent Office.'' Id. As explained in detail in this final rule 
package, the six years of experience with AIA proceedings, the many 
additional parallel court cases, as well as the numerous requests from 
stakeholders concerned with the use of BRI and comments received, make 
clear that using the same claim construction standard as in federal 
courts and the ITC better serves the public and the intent

[[Page 51347]]

of the AIA to provides, among other things, ``a more efficient and 
streamlined patent system that will improve patent quality and limit 
unnecessary and counterproductive litigation costs.'' AIA H.R. Rep. No. 
112-98, pt. I at 48 (2011), as reprinted in 2011 U.S.C.C.A.N. 67, 78; 
see also id. at 40. Indeed, many of the bases originally advanced in 
2012 as justifying the use of BRI have not been borne out. See e.g., 
Greenleaf at 11 (``It is not clear, given more than five years of 
experience with PTAB post-grant proceedings, that there is any 
justification for using BRI for issued patents).
    As to the suggestion that the rulemaking has been arbitrary and 
capricious, the Office has proceeded with the implementation of AIA 
proceedings deliberately and with caution, continuously engaging the 
public and seeking feedback to gauge the effectiveness of the rules and 
procedures that govern AIA proceedings. At each stage of the process, 
including in this final rule, the Office has supported its exercise of 
discretion with reasoned analysis in response to comments received. For 
example, in the initial 2012 rulemaking, the Office adopted the BRI 
standard for construing claims of unexpired patents based on its prior 
experience, as well as adopting the principles articulated in Phillips 
and its progeny for interpreting claims of expired patents. 77 FR 
48680. To elicit even more input, in June of 2014, the Office published 
a Request for Comments in the Federal Register and, at public request, 
extended the period for receiving comments to October 16, 2014. See 
Request for Comments on Trial Proceedings Under the America Invents Act 
Before the Patent Trial and Appeal Board, 79 FR 36474 (June 27, 2014) 
(``Request for Comments''). The Request for Comments asked seventeen 
questions on ten broad topics, including a general catchall question, 
to gather public feedback on any changes to AIA proceedings that might 
be beneficial. See Request for Comments, 79 FR at 36476-77. This was 
followed by the 2016 rulemaking, where the Office incrementally 
expanded the use of the district court claim construction standard, 
which is articulated in Phillips, to interpret claims of soon-to-be-
expired patents in AIA proceedings. 81 FR 18750.
    As noted above, since the time of the last AIA rule package, the 
Federal Circuit has issued a six-fold increase in the number of 
decisions relating to AIA proceedings. And now, in light of these 
decisions and based on the PTAB's experience over six years, including 
applying the federal court claim construction standard in AIA 
proceedings in certain contexts, the Office has determined that 
employing the district court standard for interpreting all claims in 
AIA proceedings will continue to enhance predictability and reliability 
of the patent system.
    The PTAB's use of the district court standard, for interpreting all 
claims in AIA proceedings, will address concerns that have been 
continually expressed by stakeholders and demonstrated in recent 
studies that the use of a different claim construction standard in AIA 
proceedings wastes resources and has the potential for resulting in 
troubling differences in construction-outcomes between proceedings. See 
Bagley at 354; Greenleaf at 9. Notably, the PTAB will continue to 
provide a second look at an earlier administrative grant of a patent by 
determining whether to review the claims challenged by a petitioner 
based on the prior art and grounds asserted in the petition, with any 
final action taking into account the evidence in the entire record of 
any instituted proceeding. In addition, the PTAB will consider the 
claim language itself, the specification, prosecution history 
pertaining to the patent, and any prior claim construction 
determinations from the federal courts and the ITC that have been 
timely made of record, to provide a claim construction determination in 
accordance with the amended rules as adopted in this final rule. The 
PTAB will consider the issues as briefed by the parties, and may review 
whatever portions of the record are required to arrive at the 
``correct'' construction pursuant to Phillips and its progeny. The PTAB 
also will continue to provide an initial claim construction 
determination in the institution decision based on the record at the 
preliminary stage, including the parties' proposed claim constructions 
and supporting evidence. If a trial is instituted, the parties will 
continue to have sufficient opportunities to submit additional 
arguments and evidence during the trial, addressing the PTAB's initial 
claim construction determination before the oral hearing. The PTAB will 
continue to consider the entirety of the trial record before entering a 
final written decision that sets forth any final claim construction 
determination. A party dissatisfied with the final written decision, 
including the final claim construction determination, will continue to 
have the opportunity to file a request for rehearing without prior 
authorization from the PTAB and the right to appeal the decision to the 
Federal Circuit. All parties will continue to have a full and fair 
opportunity to present arguments and evidence prior to any final 
determination. The vast majority of commentators, including those few 
opposed to the change, agree that the PTAB's current procedures are 
effective in implementing the goals of the AIA, and those procedures 
remain available.
    As in the federal courts and ITC, the PTAB will ``seek out the 
correct construction--the construction that most accurately delineates 
the scope of the claim invention--under the framework laid out in 
Phillips.'' PPC Broadband, 815 F.3d at 740. To promote fairness, 
balance, predictability, and certainty in the patent system, the Office 
is exercising its statutory authority under 35 U.S.C. 316(a)(2), 
316(a)(4), 326(a)(2), and 326(a)(4) to adopt the federal court claim 
construction standard, which is articulated in Phillips, for 
interpreting claims in AIA proceedings, harmonizing the claim 
construction standards between AIA proceedings and proceedings before 
the federal courts and ITC. See, e.g., 35 U.S.C. 316(a)(4) (``The 
Director shall prescribe regulations . . . establishing and governing 
inter partes review of this chapter and the relationship of such review 
to other proceedings under this title.''). Fundamentally, each of the 
federal courts, the ITC, and the PTAB will use the same objective 
standards under the Phillips framework to arrive at the claim 
construction when performing their analysis. Predictability and 
reliability of the patent system are thus enhanced, for example by 
increasing the likelihood that a claim will be construed in the same 
manner by the federal courts, the ITC, and the PTAB.

Consistency

    Comment 3: Many comments stated that the rule change will promote 
consistency between the various fora. The comments suggested this would 
result in a more uniform and fair patent system. The comments further 
asserted adoption of the Phillips standard prevents parties from taking 
inconsistent positions, such as a patent challenger arguing for a broad 
scope in a PTAB proceeding (under BRI) and a narrow scope (under 
Phillips) in district court to avoid a finding of infringement.
    Response: The Office agrees that aligning the claim construction 
standard used in PTAB proceedings with that used by the federal courts 
and the ITC promotes consistency in claim construction rulings and 
patentability determinations. The Federal Circuit has stated that when 
a party loses in a court proceeding challenging a patent, ``the

[[Page 51348]]

PTO ideally should not arrive at a different conclusion'' on the same 
presentations and arguments. See In re Baxter, 678 F.3d 1357, 1365 
(Fed. Cir. 2012). Adoption of the Phillips standard will reduce the 
potential for inconsistent results between different fora. We further 
agree that consistency leads to a more uniform, reliable, and 
predictable patent system. Specifically, as discussed above, the 
adoption of the federal court claim construction standard is consistent 
with ``uniform interpretation of the patent laws,'' which is a well-
recognized goal of the patent system as it allows the strength of 
patents to be meaningfully and positively predicted. Hearings on H.R. 
6033, H.R. 6934, H.R. 3806 and H.R. 2414, Before the Subcomm. on 
Courts, Civil Liberties and the Admin. of Justice of the House Comm. on 
the Judiciary, 96th Cong., 797 (1980).
    Comment 4: Some comments stated that the BRI standard ensures 
claims will be interpreted consistently among different proceedings 
before the Office, and applying different claim construction standards 
for different parts of the Office will lead to inconsistency, 
confusion, and complexity within the Office. A few comments also 
asserted that adopting the Phillips standard will frustrate the 
Office's statutory authority to consolidate different proceedings 
involving the same patent. Some of the comments further suggested that 
the Office may find claims patentable over prior art in an AIA 
proceeding applying the Phillips standard and at the same time 
unpatentable over the same prior art in a reexamination applying the 
BRI standard. The comments noted that, if the PTAB does not apply the 
BRI standard in AIA proceedings, the Office will be required to approve 
in an AIA proceeding a patent claim that it would have rejected in an 
initial examination or reexamination considering the same prior art.
    Response: As the Federal Circuit recently explained, ``[i]n many 
cases, the claim construction will be the same under [both the BRI and 
Phillips] standards.'' In re CSB-System Int'l, Inc., 832 F.3d 1335, 
1341 (Fed. Cir. 2016). ``Even under the broadest reasonable 
construction rubric . . . , the board must always consider the claims 
in light of the specification and teachings in the underlying patent.'' 
In re Power Integrations, Inc., 884 F.3d 1370, 1375 (Fed. Cir. 2018) 
(citation and internal quotation marks omitted). ``And there is no 
reason why this construction could not coincide with that of a court in 
litigation.'' Id. Moreover, in an AIA proceeding, ``[t]he PTO should 
also consult the patent's prosecution history in proceedings in which 
the patent has been brought back to the agency for a second review.'' 
Microsoft Corp. v. Proxyconn, Inc., 789 F.3d 1292, 1298 (Fed. Cir. 
2015), overruled on other grounds by Aqua Prods., Inc. v. Matal, 872 
F.3d 1290 (Fed. Cir. 2017) (en banc). ``[T]he Board's construction 
cannot be divorced from the specification and the record evidence'' and 
``must be consistent with the one that those skilled in the art would 
reach.'' Id. (citations and internal quotation marks omitted). ``A 
construction that is unreasonably broad and which does not reasonably 
reflect the plain language and disclosure will not pass muster.'' Id. 
(citation and internal quotation marks omitted). In addition, the 
recent IPO study acknowledged that ``[i]t is difficult to dissect or 
predict the differences between outcomes under BRI or Phillips'' and 
that ``[t]he claim construction procedure under both standards appears 
to be very similar if not identical.'' Greenleaf, at 9. The IPO study 
indicates that, since 1986, ``there have been very few decisions in 
which courts have attributed a variance in claim interpretation to the 
differences between the two standards.'' Id. at 1. In sum, consistent 
with the IPO study and the Federal Circuit, we believe that the 
patentability determination reached will be consistent for BRI and 
Phillips in the vast majority of cases decided.
    Furthermore, the Office already has been applying the principles 
articulated in Phillips to claims of expired patents and soon-to-be 
expired patents that were previously examined, reexamined, or reissued, 
under the BRI standard. Based on the Office's years of experience, 
employing the federal court claim construction standard, which is 
articulated in Phillips, for interpreting all claims in AIA proceedings 
will not lead to inconsistency, confusion, and complexity within the 
Office. For example, the Office has been applying the Phillips standard 
in ex parte reexamination, e.g. with regard to expired claims, since 
its implementation in 1981.
    In direct contrast to AIA proceedings, the Office is required by 
statute to conduct reissue and reexamination proceedings according to 
the procedures established for initial examination. 35 U.S.C. 251(c) 
and 305. Under 35 U.S.C. 315(d) and 325(d), during the pendency of an 
AIA proceeding, ``if another proceeding or matter involving the patent 
is before the Office, the Director may determine the manner in which 
the [AIA proceeding] or other proceeding or matter may proceed, 
including providing for stay, transfer, consolidation, or termination 
of any such matter or proceeding.'' The Office has exercised its 
discretion under these statutory provisions to stay and/or terminate 
reexaminations and reissue proceedings. The Office has not, to date, 
merged or consolidated a reexamination or reissue proceeding with an 
AIA proceeding. Prior to making a determination to consolidate 
proceedings, the Office will consider whether the claim construction 
standard would have any material effect on the claim construction 
determinations in the specific proceedings at issue, for example by 
considering whether a term at issue in any of the proceedings has a 
different construction under the different claim construction 
standards. Additionally, as to comments that the Office will arrive at 
different claim constructions in AIA proceedings and reexaminations, 
the Office has existing tools to address these situations, including, 
e.g., the use of discretion under 35 U.S.C. 325(d).
    As stated in the notice of proposed rulemaking, one study found 
that 86.8% of patents at issue in AIA proceedings also have been the 
subject of litigation in the federal courts. Saurabh Vishnubhakat, Arti 
K. Rai & Jay P. Kesan, Strategic Decision Making in Dual PTAB and 
District Court Proceedings, 31 Berkeley Tech. L.J. 45 (2016), http://ssrn.com/abstract=2731002. Based on these data, feedback the Office has 
received from the public, recent case law regarding claim construction 
standards, and the submitted comments, it is appropriate to harmonize 
the claim construction standard used in AIA proceedings with the 
standard used in the federal courts and ITC proceedings.
    In addition, unlike initial examination of pre-issued claims in a 
patent application, patent owners in AIA proceedings have not filed as 
many motions to amend as previously anticipated (through June 30, 2018, 
the Office has decided only 196 motions to amend, granting 4%, 
granting-in-part 6%, and denying 90%). As noted in a comment received 
from a trade association, patent owners are reluctant to substantially 
amend claims that have been asserted in a co-pending infringement 
litigation. This comment stated that ``this is generally believed to be 
due to intervening rights [e.g., under 35 U.S.C. 318(c), 328(c), and 
252] and the loss of past damages [for infringement in a co-pending 
litigation] after amendment, not to any inability to amend.'' See, 
e.g., McKeown, Amendment Efforts at PTAB Trend Downward, LexisNexis 
Newsroom (Dec. 2014), available at https://

[[Page 51349]]

www.lexisnexis.com/legalnewsroom/intellectual-property/b/patent-
lawblog/archive/2014/12/16/amendment-efforts-at-ptab-trend-
downward.aspx (noting that ``historically, patentees would rarely amend 
claims at the USPTO that were asserted in a co-pending litigation'' due 
to intervening rights and tying the lack of use of amendments in IPR to 
those intervening rights). Claim amendments in AIA proceedings have 
therefore been relatively rare and substantially different than 
amendments during examination. Accordingly, one of the original bases 
suggested for the use of BRI has not been borne out, and the Office no 
longer believes that the opportunity to amend in an AIA proceeding 
justifies the use of BRI.
    On balance, after years of experience and in view of the comments 
received, the Office has determined that using a claim construction 
standard for issued patents subject to AIA proceedings that is 
consistent with the standard applied in federal courts and the ITC is 
better for advancing the economy, the integrity of the patent system, 
the efficient administration of the Office, and the ability of the 
Office to complete timely the proceedings.
    Comment 5: Some comments asserted that harmonizing the claim 
construction standards between AIA proceedings and the proceedings 
before the federal courts and the ITC would not necessarily result in 
the same claim constructions. They pointed out that federal courts 
applying the Phillips standard can reach different constructions for a 
particular claim (as in the situation where the Federal Circuit 
disagrees with the construction provided by a district court); many 
courts may not wholly accept the PTAB's constructions; and the 
evidentiary standard in AIA proceedings is different from the standard 
used in the federal courts and the ITC.
    Response: The PTAB is required by statute to employ a different 
evidentiary standard for determining the patentability of a challenged 
claim than that used in federal courts and the ITC. However, there is 
no statute applicable to either the PTAB or federal courts that 
requires any different standards, evidentiary or otherwise, for claim 
construction. Moreover, as to harmonizing claim construction standards, 
the Federal Circuit recently explained that the prosecution disclaimer 
doctrine includes patent owner's statements made in an AIA proceeding, 
to ensure that ``claims are not argued one way in order to maintain 
their patentability and in a different way against accused 
infringers.'' Aylus Networks, Inc. v. Apple Inc., 856 F.3d 1353, 1360-
61 (Fed. Cir. 2017) (citing Southwall Techs., Inc. v. Cardinal IG Co., 
54 F.3d 1570, 1576 (Fed. Cir. 1995)). As the Federal Circuit 
acknowledged, consistency between fora is important.
    Under the amended rules, as adopted by this final rule, the PTAB 
will apply the same claim construction standard as used in federal 
courts and the ITC, ``seek[ing] out the correct construction--the 
construction that most accurately delineates the scope of the claim 
invention--under the framework laid out in Phillips.'' PPC Broadband, 
815 F.3d at 740. The PTAB also will consider any prior claim 
construction determinations from the PTAB, the federal courts, and the 
ITC that are timely made of record to promote consistency. Therefore, 
the amended rules will encourage parties to take a consistent position 
with respect to claim constructions in their patentability and 
infringement arguments, to ensure that whatever decision issues, 
regardless of forum, is reflective of the ``correct'' construction.
    As to comments that courts may not wholly accept the PTAB's 
constructions, this is an issue that federal courts will decide in the 
particular cases that come before them, based on the record available 
at that time. Having the same claim construction standard, however, 
increases the likelihood that courts may consider the PTAB's 
construction for a given patent.

Clarity and Public Notice

    Comment 6: Several comments were in favor of the Phillips standard 
for interpreting claims in AIA procedures because it would promote 
clarity and eliminate the current disparity in how claims are 
construed. The comments asserted that the current differences in claim 
construction standards undermine the public notice function and subject 
patent owner's property rights to unnecessary and undesirable risks, 
which discourages investment in innovative ideas and hurts inventors 
and innovation.
    Response: We agree that adoption of the Phillips claim construction 
standard will promote clarity and public notice. By using the same 
claim construction standard in PTAB proceedings that is used by the 
federal courts and the ITC, greater certainty on the scope of issued 
patent claims will be provided to all stakeholders. In particular, we 
agree with the comments received that reducing the potential for 
inconsistent results between the PTAB and federal courts would 
encourage inventors to use the patent system. For example, one trade 
association commented that a uniform standard would lead to greater 
certainty and investment, while another trade association stated that 
the adoption of the federal court claim construct standard promoted 
certainty, which is a recognized goal of the AIA. Senate Debate, 157 
Cong. Rec. S5347, S5354 (daily ed. Sept. 7, 2011) (Statement of 
Administration Policy on H.R. 1249) (discussing how the AIA created new 
trial proceedings ``to increase the quality and certainty of patent 
rights and offer cost-effective, timely alternatives to district court 
litigation'').
    Comment 7: A few comments asserted that the BRI standard promotes 
clarity and public notice by incentivizing a patentee to amend its 
claims so that the boundary between its patent rights and the prior art 
can be more clearly delineated. A few comments also expressed concerns 
that, if the PTAB applies the Phillips standard in AIA proceedings, the 
district court may construe a claim more broadly than the PTAB's claim 
construction, resulting in a situation where subject matter that is in 
the prior art nonetheless may infringe the patent.
    Response: The PTAB's construction of a claim under the framework 
set forth in Phillips will promote clarity and public notice. Moreover, 
since both a district court and the PTAB will use the same standard to 
construe the claim, there will be reduced likelihood of differences 
between the scope of claim construction at either forum. The Federal 
Circuit recently affirmed a district court's claim construction by 
holding that the statements made by a patent owner during an AIA 
proceeding, even before institution, are part of the prosecution 
history and can be relied on to support a finding of prosecution 
disclaimer. Aylus Networks, 856 F.3d at 1361. The court explained that 
``[e]xtending the prosecution disclaimer doctrine to IPR proceedings 
will ensure that claims are not argued one way in order to maintain 
their patentability and in a different way against accused 
infringers.'' Id. at 1360. ``In keeping with the underlying purposes of 
the doctrine, this extension will `promote[ ] the public notice 
function of the intrinsic evidence and protect[ ] the public's reliance 
on definitive statements made during''' AIA proceedings. Id. (quoting 
Omega Eng'g, Inc. v. Rayteck Corp., 334 F.3d 1314, 1324 (Fed. Cir. 
2003)). Accordingly, applying the same standard will alleviate the 
commentators' concerns with regard to differences in claim scope 
between the district court and PTAB.
    In addition, under the amended rules, as adopted by this final 
rule, the PTAB

[[Page 51350]]

will consider any prior claim construction determinations from federal 
courts and the ITC that are timely made of record to enhance 
consistency. Moreover, as noted above, unlike initial examination, the 
vast majority of AIA proceedings involve patents in litigations, and as 
noted above, patent owners are reluctant to substantially amend their 
claims that are involved in an infringement litigation for a variety of 
reasons, such as to avoid triggering intervening rights. Therefore, one 
of the originally suggested bases for using BRI in 2012 has not been 
borne out. Claim amendments in AIA proceedings are relatively rare and 
substantially different than amendments during examination, and the 
Office no longer believes that the opportunity to amend in an AIA 
proceeding justifies the use of BRI.

Fairness

    Comment 8: Many comments opined that harmonizing the claim 
construction standard used in AIA proceedings with that used in the 
federal courts and ITC proceedings will ensure greater fairness and 
predictability to the patent system, which will in turn maximize 
judicial efficiency and minimize economic waste. Several comments 
acknowledged that harmonizing the claim construction standards would 
prevent parties from taking inconsistent positions and will properly 
balance the interests of both patent owners and petitioners. Some of 
the comments further noted that applying different standards in 
different fora unfairly advantages the patent challenger because an 
accused infringer may seek a broad construction for purposes of finding 
claims unpatentable in an AIA proceeding before the PTAB and a narrow 
construction for purposes of arguing non-infringement in a federal 
court action.
    Response: The Office agrees with these comments. This final rule 
adopts the federal court claim construction standard, which is 
articulated in Phillips, for AIA proceedings, aligning the claim 
construction standard used in AIA proceedings with the standard used in 
the federal courts and ITC proceedings. This will promote a more fair 
and balanced system because parties will no longer be able to argue for 
a broader claim scope in PTAB proceedings than that used by federal 
courts. Several commenters stated that the BRI standard allows parties 
to take inconsistent positions between PTAB proceedings for 
patentability and litigation for infringement. One commenter stated 
``[c]urrently, the absence of a uniform claim construction standard 
permits patent infringers to aggressively argue inconsistent positions 
on claim scope in different forums with impunity--a broad scope before 
the PTAB, and a narrow scope in district court. With a uniform 
application of the Phillips standard, patent challengers will have less 
flexibility to advance inconsistent arguments about claim scope, and 
will instead be required to choose a single claim construction that 
best captures the true meaning of the patent claim, because they will 
not be able to justify different constructions as being the mere result 
of different claim construction standards.'' The lack of a uniform 
standard between the PTAB and federal courts runs contrary to the 
general principle articulated in Source Search Techs LLC v. Lending 
Tree, LLC, that ``it is axiomatic that claims are construed the same 
way for both validity and infringement.'' 588 F.3d 1063, 1075 (Fed. 
Cir. 2009).
    Comment 9: Some comments opposed the proposed rules, asserting that 
using the Phillips standard in AIA proceedings would not alleviate 
perceived unfairness. A few comments suggested that the Phillips 
standard is susceptible to various reasonable interpretations, which 
can produce multiple possible constructions, and that there is no 
certainty that the decision of the PTAB and the courts will be 
harmonized. Some of the comments also indicated that applying the BRI 
standard in AIA proceedings is not unfair to patentees because they 
have the opportunity to amend the claims to obtain more precise claim 
coverage, and the BRI standard ``serves the public interest by reducing 
the possibility that claims, finally allowed, will be given broader 
scope than is justified,'' citing In re American Academy of Science 
Tech Center, 367 F.3d 1359, 1362-63 (Fed. Cir. 2004) (citation and 
internal quotation marks omitted). These comments asserted that 
replacing the BRI standard would undermine this goal, resulting in less 
predictability and inviting gamesmanship from patentees.
    Response: As noted above, unlike initial examination, the vast 
majority of AIA proceedings involve patents in litigation, and, 
according to several comments, patent owners are reluctant to 
substantially amend their claims that are involved in an infringement 
litigation for a number of reasons, such as in order to avoid 
triggering intervening rights. As stated in the notice of proposed 
rulemaking, having AIA proceedings use the same claim construction 
standard that is applied in federal courts and ITC proceedings also 
addresses the concern that potential unfairness could result from using 
an arguably broader standard in AIA proceedings. According to some 
patent owners, the same claim construction standard should apply to 
both the validity (or patentability) determination and the infringement 
determination. Because the BRI standard potentially reads on a broader 
universe of prior art than does the Phillips standard, a patent claim 
could potentially be found unpatentable in an AIA proceeding (under the 
BRI standard) on account of claim scope that the patent owner would not 
be able to assert in an infringement proceeding (under the Phillips 
standard). For example, even if a competitor's product would not be 
found to infringe a patent claim (under the Phillips standard) if it 
was sold after the patent's effective filing date, the same product 
nevertheless could potentially constitute invalidating prior art (under 
the BRI standard) if publicly sold before the patent's effective filing 
date.
    Based on its 6 years of experience with AIA proceedings, the Office 
has determined that the same claim construction standard should apply 
to both a patentability determination at the PTAB and determinations in 
federal court on issues related to infringement or invalidity. Under 
the amended rules as adopted by this final rule, the PTAB also will 
consider any prior claim construction determination concerning a term 
of the claim in a civil action or a proceeding before the ITC that is 
timely made of record in an AIA proceeding. This will increase the 
likelihood that claims are not argued one way in order to maintain 
their patentability (or to show that the claims are unpatentable) and 
in a different way against an opposing party in an infringement case, 
consistent with recent case law from the Federal Circuit. See Aylus 
Networks, 856 F.3d at 1360. Rather, regardless of forum, the same 
objective standards will be used for claim construction.
    Additionally, as discussed above, one of the originally suggested 
bases for using the BRI in 2012 has not been borne out. Claim 
amendments in AIA proceedings are relatively rare and substantially 
different than amendments during examination, and the Office no longer 
believes that the opportunity to amend in an AIA proceeding justifies 
the use of the BRI.

Efficiency, Cost, Timing, and Procedural Issues

    Comment 10: Most comments supported harmonizing of the claim 
construction standard used in AIA

[[Page 51351]]

proceedings with the standard used in the proceedings before federal 
courts and the ITC because different claim construction standards used 
in various fora encourage forum shopping and parallel duplicative 
proceedings. According to the comments, using the same claim 
construction standard across the fora would increase efficiency as well 
as certainty, and it would reduce cost and burden because parties would 
only need to focus their resources to develop a single set of claim 
construction arguments.
    Response: The Office agrees with these comments. The existence of 
different approaches to claim construction determinations may encourage 
a losing party to attempt for a second bite at the apple, resulting in 
a waste of the parties' and judicial resources alike. See Niky R. 
Bagley, Treatment of PTAB Claim Construction Decisions: Aspiring to 
Consistency and Predictability, 32 Berkeley Tech. L.J. 315, 354 (2018). 
Adoption of the Phillips standard will increase efficiencies and will 
reduce costs to parties because it eliminates the incentive to forum 
shop based upon claim construction standards and eliminates the need to 
present multiple claim construction arguments under different 
standards. As discussed above, several trade associations and 
corporations commented that the use of the same claim construction 
standard will reduce duplication of efforts by parties and by the 
various tribunals. As one commenter further stated, ``[w]ith the PTAB 
and district courts applying the same claim construction standard, 
there will be a stronger basis for judges in one forum to rely on claim 
constructions rulings from the other, avoiding unnecessary duplication 
of work.''
    Comment 11: One comment seeks clarification of whether the PTAB 
would review evidence of infringing products to construe claims. 
According to the comment, claims cannot be construed under the Phillips 
standard without at least some reference to the product accused of 
infringement, citing Wilson Sporting Goods Co. v. Hillerich & Bradsby 
Co., 442 F.3d 1322, 1324 (Fed. Cir. 2006), for support.
    Response: To the extent that the comment suggests that Wilson 
requires consideration of infringement issues during claim 
construction, such a reading would overstate that case. In Wilson, the 
Federal Circuit ``repeats its rule that claims may not be construed 
with reference to the accused device.'' Wilson, 442 F.3d at 1330-31. It 
further explained that ``that rule posits that a court may not use the 
accused product or process as a form of extrinsic evidence to supply 
limitations for patent claim language. Thus, the rule forbids a court 
from tailoring a claim construction to fit the dimensions of the 
accused product or process and to reach a preconceived judgment of 
infringement or noninfringement. In other words, it forbids biasing the 
claim construction process to exclude or include specific features of 
the accused product or process.'' Id. In Wilson, the court merely 
stated that, in certain situations, ``[t]he rule, however, does not 
forbid awareness of the accused product or process to supply the 
parameters and scope of the infringement analysis'' and ``a trial court 
may refer to the accused product or process for that context during the 
process.'' Id. (emphasis added). As such, Wilson, merely stands for the 
proposition that it is permissible to consider an accused product in 
the context of claim construction for purposes of infringement, not 
that an accused product must be considered in all claim construction 
disputes.
    The Federal Circuit's decision in Wilson specifically addresses the 
district court's claim construction in the context of an infringement 
case. But under 35 U.S.C. 318 and 328, in an instituted AIA proceeding, 
the PTAB is required to ``issue a final written decision with respect 
to the patentability of any patent claim challenged by the 
petitioner.'' As required by statute, the PTAB will continue to 
construe claims in the context of patentability (e.g., the asserted 
prior art), not infringement. Because infringement issues are generally 
not before the PTAB in a patentability determination, the PTAB does 
not, in most circumstances, expect this case to have applicability in 
IPR proceedings. However, if a party believes that the claims of a 
particular patent cannot be construed absent consideration of 
additional evidence not called for in the Board's rules or practices, 
that party should contact the panel of judges overseeing the proceeding 
and request a conference call to discuss the facts of that specific 
issue.
    Comment 12: Several comments suggested using the same claim 
construction procedures as used in the federal court. A few comments 
expressed concerns that fully adopting the same claim construction 
standard used by federal courts and the ITC could make it difficult for 
the Office to comply with the statutory deadline because the claim 
construction procedure at the federal courts and the ITC often involves 
considerable briefing, expert testimony, technology tutorials, and 
Markman hearings, which are expensive and time consuming.
    Response: The Office has been applying the principles articulated 
in Phillips and its progeny in AIA proceedings for interpreting claims 
of expired patents, since the effective date of the AIA in 2012, and 
for interpreting claims of soon-to-be expired patents, since 2016. Even 
in those proceedings, the Office has met all of its statutory 
deadlines, utilizing the same efficient and cost effective procedures 
used in other AIA proceedings that applied the BRI standard. The Office 
will continue to employ a trial procedure in all AIA proceedings that 
provides ``quick and cost effective alternatives'' to litigation in the 
courts, as Congress intended. Thus, as discussed above, USPTO expects 
that these proceedings utilizing the Phillips standard will operate 
procedurally in much the same way as proceedings utilizing the BRI 
standard, that they will cost USPTO and parties no more to conduct, and 
that they will be completed within the statutory deadline.
    Comment 13: Some comments expressed concerns that additional 
briefing and hearings related to claim construction would raise costs. 
One comment suggested that the PTAB should continue to provide non-
final claim construction in the institution decisions. A few comments 
suggested allowing the parties a full and fair opportunity to present 
arguments and evidence prior to any final determination.
    Response: As discussed above, USPTO expects--based on its prior 
experience in using the Phillips standard for expired and soon-to-
expire claims--that these proceedings using the Phillips standard will 
operate procedurally in much the same way as proceedings using the BRI 
standard, that they will cost USPTO and parties no more to conduct, and 
that they will be completed within the statutory deadline. The Office 
will continue to use the trial procedure set forth in its Office Patent 
Trial Practice Guide, along with any updates and amendments that USPTO 
may decide to make in the future. As discussed above, USPTO does not 
need to revise these procedures and guidance to implement the change 
set forth in the final rule, and does not need to make regulatory 
changes other than those set forth in the final rule. Both the 
petitioner and patent owner will continue to have sufficient 
opportunities, during the preliminary stage, to submit their proposed 
claim constructions (in a petition and preliminary response, 
respectively) and

[[Page 51352]]

any supporting evidence, including both intrinsic and extrinsic 
evidence. Upon consideration of the parties' proposed claim 
constructions and supporting evidence, the PTAB will continue to 
provide an initial claim construction determination in the institution 
decision, to the extent that such construction is required to resolve 
the disputes raised by the parties. If a trial is instituted, the 
parties also will continue to have opportunities to cross-examine any 
opposing declarants, and to submit additional arguments and evidence, 
addressing the PTAB's initial claim construction determination and the 
opposing party's arguments and evidence before oral hearing. The PTAB 
also will continue to consider the entirety of the trial record, 
including the claim language itself, the specification, prosecution 
history pertaining to the patent, extrinsic evidence as necessary, and 
any prior claim construction determinations from the federal courts and 
the ITC that have timely been made of record, before entering a final 
written decision that sets forth the final claim construction 
determination. All parties will continue to have a full and fair 
opportunity to present arguments and evidence prior to any final 
determination. The vast majority of commentators, including many of 
those opposed to the change, agree that the Board's current procedures 
are effective in implementing the goals of the AIA. Those procedures 
remain available, will continue to apply when this final rule goes into 
effect, and will be improved in the future as necessary.

Proposed Substitute Claims

    Comment 14: Most of the comments supported applying the federal 
court claim construction standard, which is articulated in Phillips, 
uniformly to both original patent claims and substitute claims proposed 
in a motion to amend. The comments suggested that using the federal 
court claim construction standard should lead to greater consistency 
with the federal courts and the ITC, and such consistency will lead to 
greater certainty as to the scope of issued patent claims. The comments 
also indicated that using the federal court claim construction standard 
is appropriate because amendments proposed in AIA proceedings are 
required to be narrowing, are limited to a reasonable number of 
substitute claims, and are required to address patentability challenges 
asserted against the original patent claims. The comments further noted 
that using the same claim construction standard for interpreting both 
the original and amended claims avoids the potential of added 
complexity and inconsistencies between PTAB and federal court 
proceedings, and this allows the patent owner to understand the scope 
of the claims and more effectively file motions to amend. One of the 
comments stated that the BRI standard is appropriate in the context of 
the initial ex parte examination, but not appropriate for AIA 
proceedings, which are inter partes post-grant proceedings, potentially 
standing in for district court validity determinations, and allowing 
only amendments that narrow the scope of the original patent claim.
    Response: The Office agrees with these comments. Under the amended 
rules, as adopted in this final rule, a claim of a patent, or a claim 
proposed in a motion to amend, ``shall be construed using the same 
claim construction standard that would be used to construe the claim in 
a civil action.'' We agree that adoption of the Phillips standard is 
appropriate because, among other things, the claim amendments are 
limited to a reasonable number and are required to be narrowing. 
Further, the final rule will reduce the potential for inconsistency in 
claim construction between PTAB proceedings and the proceedings in 
federal court and the ITC, which we agree will result in greater 
certainty of the scope of issued patent claims.
    Comment 15: Some comments opposed applying the federal court claim 
construction standard to substitute claims proposed in a motion to 
amend because it would create the risk that a district court would 
construe a claim broadly beyond the claim scope allowed by the Office. 
According to these comments, it is inappropriate and inconsistent for 
the Office to employ a different standard when new claims are presented 
to the PTAB on appeal from an examiner compared to when the same new 
claims are presented to the PTAB in an AIA proceeding. Some of the 
comments suggested eliminating amendments or applying the BRI standard 
in a proceeding in which the patent owner files a motion to amend to 
protect the public from vague and overly broad amendments. One comment 
indicated that, if the PTAB applies the federal court claim 
construction standard in an AIA proceeding, the PTAB should require 
patent owner to amend its claim to reflect that claim construction.
    Response: As noted in the notice of proposed rulemaking, unlike 
initial examination of new or amended claims in a patent application, 
the patent owner may file a motion to amend an unexpired patent during 
an AIA proceeding to propose a reasonable number of substitute claims, 
but the proposed substitute claims ``may not enlarge the scope of the 
claims of the patent or introduce new matter.'' 35 U.S.C. 316(d) and 
326(d); 37 CFR 42.121(a)(2), 42.221(a)(2). The Federal Circuit recently 
noted that ``[t]he patent owner proposes an amendment that it believes 
is sufficiently narrower than the challenged claim to overcome the 
grounds of unpatentability upon which the IPR was instituted.'' Aqua 
Prods., 872 F.3d at 1306 (emphasis in the original). By requiring a 
narrower claim, a district court applying the same objective claim 
construction standards under the Phillips framework should not construe 
a substitute claim beyond the scope allowed by the Office. Further, as 
to any concern with vague or overly broad amendments, the PTAB is 
required to issue final written decisions with respect to the 
patentability of any new claim added, thus ensuring that vagueness and 
overbreadth issues will be resolved by the Office before issuance.
    Further, as to the suggestion that the Office require patent owners 
to amend claims to reflect a federal court claim construction, such a 
suggestion is not adopted for a variety of reasons. Among other things, 
the PTAB will construe claims under the final rule using the same 
objective standards under the Phillips framework as used by the federal 
courts. Additionally the final rule specifies that ``any prior claim 
construction determination concerning a term of the claim in a civil 
action, or a proceeding before the International Trade Commission, that 
is timely made of record in the covered business method patent review 
proceeding will be considered.''

Construing Claims To Preserve Validity

    Comment 16: Some comments opposed using a standard that applies the 
doctrine of construing claims to preserve their validity.
    Response: In this final rule, the Office fully adopts the federal 
courts claim construction standard, which is articulated in Phillips, 
for interpreting claims in AIA proceedings. This rule reflects that the 
PTAB in an AIA proceeding will apply the same standard applied in 
federal courts to construe patent claims.
    To the extent that federal courts and the ITC still apply the 
doctrine of construing claims to preserve their validity as described 
in Phillips, the Office will apply this doctrine for purposes of claim 
construction if dictated by the principles of Phillips and its progeny, 
e.g., if those same rare circumstances arise in AIA proceedings.

[[Page 51353]]

As the Federal Circuit recognized in Phillips, this doctrine is ``of 
limited utility.'' Phillips, 415 F.3d at 1327-28. The Court has not 
applied that doctrine broadly, and has ``certainly not endorsed a 
regime in which validity analysis is a regular component of claim 
construction.'' Id. at 1327 (citation omitted). The doctrine of 
construing claims to preserve their validity has been limited to cases 
in which ``the court concludes, after applying all the available tools 
of claim construction, that the claim is still ambiguous.'' Id. 
Moreover, the Federal Circuit ``repeatedly and consistently has 
recognized that courts may not redraft claims, whether to make them 
operable or to sustain their validity.'' Rembrandt Data Techs., LP v. 
AOL, LLC, 641 F.3d 1331, 1339 (Fed. Cir. 2011); see also MBO Labs., 
Inc. v. Becton, Dickinson & Co., 474 F.3d 1323, 1332 (Fed. Cir. 2007) 
(noting that ``validity construction should be used as a last resort, 
not first principle'').
    Even in those extremely rare cases in which the courts applied the 
doctrine, the courts ``looked to whether it is reasonable to infer that 
the PTO would not have issued an invalid patent, and that the ambiguity 
in the claim language should therefore be resolved in a manner that 
would preserve the patent's validity,'' noting that this was ``the 
rationale that gave rise to the maxim in the first place.'' Phillips, 
415 F.3d at 1327 (citing Klein v. Russell, 86 U.S. (19 Wall.) 433, 466, 
22 Led. 116 (1873)). ``The applicability of the doctrine in a 
particular case therefore depends on the strength of the inference that 
the PTO would have recognized that one claim interpretation would 
render the claim invalid, and that the PTO would not have issued the 
patent assuming that to be the proper construction of the term.'' Id. 
at 1328.
    Moreover, it also may not be necessary to determine the exact outer 
boundary of claim scope because only those terms that are in 
controversy need be construed, and only to the extent necessary to 
resolve the controversy (e.g., whether the claim reads on a prior art 
reference). See Nidec Motor Corp. v. Zhongshan Broad Ocean Motor Co. 
Ltd., 868 F.3d 1013, 1017 (Fed. Cir. 2017) (noting that ``we need only 
construe terms `that are in controversy, and only to the extent 
necessary to resolve the controversy''') (citing Vivid Techs., Inc. v. 
Am. Sci. & Eng'g, Inc., 200 F.3d 795, 803 (Fed. Cir. 1999)). Moreover, 
the Federal Circuit ``repeatedly and consistently has recognized that 
courts may not redraft claims, whether to make them operable or to 
sustain their validity.'' Rembrandt Data, 641 F.3d at 1339.

The Rule Language

    Comment 17: Some comments, although generally agreeing with the 
proposed rule change, suggested some changes to the language of the 
proposed rules. In particular, some of the comments suggested modifying 
the rule language to summarize all of the claim construction principles 
set forth in Phillips and to include other non-substantive minor edits. 
Some of the comments suggested deleting the ``including'' phrase: 
``including construing the claim in accordance with the ordinary and 
customary meaning of such claim as understood by one of ordinary skill 
in the art and the prosecution history pertaining to the patent.'' 
Although one comment acknowledged that this ``including'' phrase is 
merely exemplary, other comments suggested the deletion to ensure that 
there is no difference between the claim construction standard applied 
in AIA proceedings and the standard used in federal courts and ITC 
proceedings, and that the deletion also would preserve the ability to 
respond to future refinements in the law.
    Response: As to deleting the ``including'' phrase, the 
``including'' phrase is merely exemplary, not excluding additional 
canons of claim construction, and not intending to reflect any 
difference between standard articulated by Phillips and its progeny, as 
applied by the courts. This rule reflects that the PTAB in an AIA 
proceeding will apply the same standard applied in federal courts to 
construe patent claims. While the comments seeking the deletion of the 
``including'' phrase were not adopted, the intent of the final rule 
language is to ensure that the public understands that the rule does 
not differ in any way from the standard used in federal courts. The 
Office has also considered modifying the rule language to summarizing 
the construction principles of Phillips as well as several non-
substantive edits, but determined that the language of the rule 
provides sufficient clarity. Moreover, the intent of the rule is to 
ensure that the PTAB follows the same claim construction standard 
applied by federal courts, including any future refinements in the 
caselaw.
    Comment 18: A few comments suggested changing ``such claim in a 
civil action to invalidate a patent'' to ``the claim in a civil 
action'' because a civil action may involve infringement of a patent, 
and is not necessarily limited to invalidity actions.
    Response: This suggestion is adopted. Amended Sec. Sec.  42.100(b), 
42.200(b), and 42.300(b), as adopted in this final rule, provide ``a 
claim . . . shall be construed using the same claim construction 
standard that would be used to construe the claim in a civil action 
under 35 U.S.C. 282(b) . . . .'' Again, the intent of the final rule is 
to make clear that there is no difference between the claim 
construction standard applied by the PTAB and the standard applied by 
the federal courts to construe patent claims.
    Comment 19: A few comments suggested adding ``or the Board'' in the 
last sentence of the proposed rules to make explicit that prior PTAB 
claim construction determinations concerning a claim term will be 
considered.
    Response: Applying the federal court claim construction standard, 
which is articulated in Phillips, the PTAB will construe a claim based 
on the record of an AIA proceeding, taking into account the claim 
language itself, specification, and prosecution history pertaining to 
the patent. The prosecution history taken into account includes prior 
PTAB claim construction determinations concerning a term of the claim. 
To ensure due consideration by the PTAB, the parties should timely 
submit the relevant portions of the prosecution history that support 
their arguments along with detailed explanations. The suggested change 
is not adopted as it is unnecessary; prior PTAB claim construction 
determinations concerning a claim term will be considered under 
Phillips, for example when they are part of the intrinsic record of the 
challenged patent
    Comment 20: One comment suggested removing the reference to 35 
U.S.C. 282(b), which does not itself provide for a civil action.
    Response: The reference to 35 U.S.C. 282(b) makes clear that the 
Office is adopting the same claim construction standard used in civil 
actions ``involving the validity or infringement of a patent.'' 35 
U.S.C. 282(b). This rule reflects that the PTAB in an AIA proceeding 
will apply the same standard applied in federal courts to construe 
patent claims.

Materials to be Considered

    Comment 21: One comment requested clarification on what aspects of 
the prosecution history would be considered in a claim construction 
under the new rule.
    Response: The Office may take into account the prosecution history 
that occurred previously in proceedings at the Office prior to the 
proceeding at

[[Page 51354]]

issue, including in another AIA proceeding, or before an examiner 
during examination, reissue, and reexamination. The file history 
typically consists of the patent application as originally filed, the 
cited prior art, all papers prepared by the examiner during the course 
of examination, and documents submitted by the applicant in response to 
the various requirements, objections, and rejections made by examiner. 
In addition, the file history may contain a written record of oral 
communications addressing patentability issues between the examiner and 
applicant. The Office will determine the claim construction based on 
the record of the proceeding at issue. The parties should timely submit 
the relevant portions of the prosecution history with detailed 
explanations as to how the prosecution history support their arguments, 
to ensure that such material is considered. Each party bears the burden 
of providing sufficient support for any construction advanced by that 
party.
    Comment 22: Some comments suggested that consideration of prior 
claim construction determination should also include prior 
determinations by the Office in a prior PTAB proceeding.
    Response: Reference to ``prosecution history'' in the rule includes 
consideration of relevant determinations on claim construction in prior 
PTAB proceedings, including determinations made in ex parte appeals and 
AIA proceedings. The prosecution history includes a written record of 
all communications addressing patentability issues between the PTAB, 
the petitioner and the patent owner, including all briefing, motions, 
evidence and decisions set forth in the record of the proceeding.
    Comment 23: One comment requested clarification as to whether 
federal court claim constructions and ITC claim constructions will be 
considered under the new rules.
    Response: Yes, each of amended Sec. Sec.  42.100, 42.200, and 
42.300, as adopted in this final rule, states that ``[a]ny prior claim 
construction determination concerning a term of the claim in a civil 
action, or a proceeding before the [ITC], that is timely made of record 
in the [inter partes, post grant or covered business method patent] 
review proceeding will be considered.'' The PTAB will consider prior 
claim constructions from district courts or the ITC and give them 
appropriate weight. Non-exclusive factors to be considered may include, 
for example, how thoroughly reasoned the prior decision is and the 
similarities between the record in the district court or the ITC and 
the record before the PTAB. It may also be relevant whether the prior 
claim construction is final or interlocutory. These factors will 
continue to be relevant under the district court claim construction 
standard, which is articulated in Phillips. The PTAB may also continue 
to consider whether the terms construed by the district court or the 
ITC are necessary to decide the issues before it. This is not an 
exclusive list of considerations, and the facts and circumstances of 
each case will be analyzed as appropriate.
    Comment 24: One comment suggested that the PTAB also consider 
statements made by a patent owner in a prior proceeding in which the 
patent owner took a position on the scope of any claims of the 
challenged patent.
    Response: Under the amended rules as adopted in this final rule, 
the PTAB will consider statements regarding claim construction made by 
patent owners filed in other proceedings in claim construction 
determinations if the statements are timely made of record. Cf. Aylus 
Networks, 856 F.3d at 1360-61 (extending the prosecution disclaimer 
doctrine to include patent owner's statements made in a preliminary 
response that was submitted a prior AIA proceeding). The Board may also 
consider statements regarding claim construction made by petitioners in 
other proceedings. To the extent that a party wants such information 
considered by the Office, that party should point out specifically the 
statements and explain how those statements support or contradict a 
party's proposed claim construction in the proceeding at issue. Each 
party bears the burden of providing sufficient support for any 
construction advanced by that party. Furthermore the Office may take 
into consideration statements made by a patent owner about claim scope, 
such as those submitted under 35 U.S.C. 301(a), for example.
    Comment 25: Comments requested clarification on the use of 
extrinsic evidence, such as technical dictionaries or other scientific 
background evidence, to demonstrate how a person of ordinary skill in 
the art would interpret a particular term.
    Response: Consistent with Phillips and its progeny, the use of 
extrinsic evidence, such as expert testimony and dictionaries, will 
continue to be useful in demonstrating what a person of ordinary skill 
in the art would understand claim terms to mean. Phillips, 415 F.3d at 
1318-19. The Federal Circuit has recognized that ``extrinsic evidence 
in general is viewed as less reliable than intrinsic evidence.'' Id.; 
Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 841 (2015) 
(noting the use of extrinsic evidence when ``subsidiary facts are in 
dispute''). Moreover, when the specification is clear about the scope 
and content of a claim term, there may be no need to turn to extrinsic 
evidence for claim interpretation. See 3M Innovative Props. Co. v. 
Tredegar Corp., 725 F.3d 1315, 1326-28 (Fed. Cir. 2013). This rule 
reflects that the PTAB in an AIA proceeding will apply the same 
standard applied in federal courts to construe patent claims.
    Comment 26: One comment sought clarification on the types of civil 
actions for which claim interpretations would be considered, noting 
that reference to 35 U.S.C. 282(b) appears to limit the scope of civil 
actions to only those civil actions that arise seeking declaratory 
judgment of invalidity, and not to consideration of claim constructions 
of a patent in an infringement action filed under 35 U.S.C. 271, 
despite the fact that claim construction standards are identical in 
both types of proceedings.
    Response: Reference to ``a civil action under 35 U.S.C. 282(b)'' 
refers to the standard that will be used in interpreting claims in IPR, 
PGR, or CBM proceedings, and encompasses both invalidity and 
infringement as it relates to a defense ``in any action involving the 
validity or infringement of a patent.'' The PTAB will consider claim 
constructions in any civil action or ITC proceeding in which the 
meaning of the same term of the same patent has been previously 
construed. This rule reflects that the PTAB in an AIA proceeding will 
apply the same standard applied in federal courts to construe patent 
claims.
    Comment 27: One comment sought clarification as to the role of the 
ordinary meaning of the claim term.
    Response: The Office will construe claim terms consistent with the 
standard used in a civil action under 35 U.S.C. 282(b), which includes 
construing the claim in accordance with the ordinary and customary 
meaning in light of ``the words of the claims themselves, the remainder 
of the specification, the prosecution history, and extrinsic evidence 
concerning relevant scientific principles, the meaning of technical 
terms, and the state of the art.'' Phillips, 415 F.3d at 1314 (citing 
Innova/Pure Water, Inc. v. Safari Water Filtration Sys., Inc., 381 F.3d 
1111, 1116 (Fed. Cir. 2004)); see, e.g., Sumitomo Dainippon Pharma Co., 
Ltd. v. Emcure Pharm. Ltd., 887 F.3d 1153, 1157 (Fed. Cir. 2018) (``As 
a general rule, the ordinary and customary meaning controls unless `a 
patentee sets out a definition and acts as

[[Page 51355]]

his own lexicographer, or . . . the patentee disavows the full scope of 
a claim term either in the specification or during prosecution.''') 
(quoting Thorner v. Sony Comput. Entm't Am. LLC, 669 F.3d 1362, 1365 
(Fed. Cir. 2012)). This rule reflects that the PTAB in an AIA 
proceeding will apply the same standard applied in federal courts to 
construe patent claims.
    Comment 28: Some comments sought clarification because the rule 
does not indicate consideration of the ordinary meaning to the skilled 
artisan ``at the time of filing the invention'' or as of the ``earliest 
effective filing date.''
    Response: Consistent with Supreme Court and Federal Circuit case 
law, the Phillips claim construction standard applied will be that of 
the skilled artisan as of the effective filing date. Phillips, 415 F.3d 
at 1313 (Fed. Cir. 2005) (``[T]he ordinary and customary meaning of a 
claim term is the meaning that the term would have to a person of 
ordinary skill in the art in question at the time of the invention, 
i.e., as of the effective filing date of the patent application.'') 
(citing Innova, 381 F.3d at 1116 (``A court construing a patent claim 
seeks to accord a claim the meaning it would have to a person of 
ordinary skill in the art at the time of the invention.'')). This rule 
reflects that the PTAB in an AIA proceeding will apply the same 
standard applied in federal courts to construe patent claims.

Prior Claim Construction Determinations

    Comment 29: Some comments suggested that, in applying the Phillips 
standard, the PTAB should consider prior claim constructions from 
proceedings in federal court or the ITC.
    Response: Under the amended rules as adopted in this final rule, 
the PTAB will consider prior claim construction determinations from 
federal courts or the ITC that has been timely made of record in an AIA 
proceeding. See 37 CFR 42.100, 42.200, and 42.300.
    Comment 30: Some comments sought guidance on the intended meaning 
of ``considered'' and what level of deference and weight the PTAB will 
give to prior claim construction determinations. Some comments 
suggested that the PTAB should defer to a prior claim construction by a 
district court or the ITC. Others suggest that the proposed rule be 
modified to expressly require deference to a prior claim construction 
ruling. One comment expressed concerns that applying the Phillips 
standard may be unfair if the PTAB considers other tribunals' prior 
claim construction determinations when either or both parties did not 
participate in the prior proceedings. Another comment expressed 
concerns that requiring PTAB to consider prior claim construction 
determinations will encourage venue gamesmanship.
    Response: The suggestions that the PTAB must necessarily defer to 
prior claim constructions are not adopted. The PTAB will consider prior 
claim constructions from courts or the ITC, if timely made of record, 
and give them appropriate weight. Non-exclusive factors to be 
considered may include, for example, how thoroughly reasoned the prior 
decision is and the similarities between the record in the district 
court or the ITC and the record before the PTAB. It also may be 
relevant whether the prior claim construction is final or 
interlocutory. These factors will continue to be relevant under the 
federal court claim construction standard, which is articulated in 
Phillips. The PTAB will also consider whether the terms construed by 
the district court or the ITC are necessary to decide the issues before 
it. This is not an exclusive list of considerations, and the facts and 
circumstances of each case will be analyzed as appropriate.
    Comment 31: Some comments sought written guidance addressing how 
the PTAB will consider prior claim constructions. Some suggest a series 
of detailed questions that the PTAB should answer about what it means 
for a prior claim construction to be considered.
    Response: The PTAB may provide further guidance in the future on 
the question of how the PTAB will consider prior claim constructions as 
circumstances warrant. However, at this juncture, the PTAB has not 
decided the form that such guidance, if any, will take. Guidance, if 
issued, may take the form of, for example, a guidance document, a 
Standard Operating Procedure, or designating certain decisions as 
informative or precedential. The PTAB expects its guidance, if any, 
will be informed by its experience with cases in which a federal court 
or the ITC has rendered a claim construction using the same standard as 
the PTAB.
    The PTAB may treat a prior district court claim construction order 
the same way that such an order may be treated by a different district 
court. In particular, the PTAB will consider prior claim constructions 
from district courts or the ITC, if timely made of record, and give 
them appropriate weight. Non-exclusive factors to be considered may 
include, for example, how thoroughly reasoned the prior decision is and 
the similarities between the record in the district court or the ITC 
and the record before the PTAB. It also may be relevant whether the 
prior claim construction is final or interlocutory. These factors will 
continue to be relevant under the district court claim construction 
standard, which is articulated in Phillips. The PTAB will also consider 
whether the terms construed by the district court or ITC are necessary 
to decide the issues before it. This is not an exclusive list of 
considerations, and the facts and circumstances of each case will be 
analyzed as appropriate. This rule reflects that the PTAB in an AIA 
proceeding will apply the same standard applied in federal courts to 
construe patent claims.
    Comment 32: Some comments suggested requiring the PTAB in an AIA 
proceeding to explain in writing its reasoning when its claim 
construction differs from a prior construction of a district court or 
the ITC.
    Response: As is the current practice, the PTAB will explain in 
writing its reasoning and the basis for its decisions on claim 
construction. Depending on the circumstances of a given matter, this 
may or may not include, for example, a discussion of prior claim 
construction decisions and explanation of material differences, if any, 
as appropriate.
    Comment 33: Some comments suggested that a prior claim construction 
by a district court or the ITC will be binding on the PTAB under res 
judicata.
    Response: A claim construction order from a district court may be 
informative to PTAB, just as claim construction from PTAB may be 
informative to a district court. The precise legal implications of 
either such decision would depend on the specific facts of the cases, 
any applicable legal principles, and an analysis of those specific 
facts to the applicable legal principles. It is worth noting that 
district courts themselves may not be bound by each other's claim 
construction orders. Moreover, in many cases, the PTAB will issue a 
final decision before the corresponding district court trial has 
concluded and a final judgment has been entered. Issue preclusion, 
collateral estoppel, and res judicata must each be premised on, among 
other things, a final court judgment.
    Comment 34: One comment suggested that the Office provide proof 
that the district courts will be willing to accept the PTAB's claim 
constructions prior to a final decision knowing that these 
constructions are not final and might change.
    Response: The district courts have the discretion to review and/or 
adopt the PTAB's initial or final claim constructions, using their own 
factors and reasoning. A prior non-final claim construction by the PTAB 
may be

[[Page 51356]]

helpful and considered by the district court, just as a prior claim 
construction by the district court may be helpful and considered by the 
PTAB, depending on the facts and circumstances of a particular case.
    Comment 35: One comment suggested that the PTAB should establish 
its rules and practices for construing claims in a way that best 
ensures that later tribunals will honor those constructions. The 
comment suggests that, in addition to adopting the Phillips standard, 
the PTAB should state its intent that PTAB trial determinations be 
treated as preclusive on later tribunals.
    Response: The district courts have the discretion to review and/or 
adopt the PTAB's initial or final claim constructions, using their own 
factors and reasoning. A prior non-final claim construction by the PTAB 
may be helpful and considered by the district court, just as a prior 
claim construction by the district court may be helpful and considered 
by the PTAB, depending on the facts and circumstances of a particular 
case.
    Comment 36: Some comments suggested that the PTAB should defer to 
its own prior claim constructions.
    Response: The PTAB will continue to give due consideration to its 
own prior claim constructions, and where appropriate, may adopt those 
constructions. Non-exclusive factors to be considered may include, for 
example, how thoroughly reasoned the prior decision is and the 
similarities between the records. It also may be relevant whether the 
prior claim construction is final or interlocutory. The PTAB will also 
consider whether the terms previously construed are necessary to decide 
the issues currently before it. This is not an exclusive list of 
considerations, and the facts and circumstances of each case will be 
analyzed as appropriate.
    Comment 37: Some comments sought guidance on the timing and 
procedures for submitting claim construction materials from other 
tribunals to the PTAB.
    Response: Parties should submit a decision on claim construction by 
a federal court or the ITC in an AIA proceeding as soon as that 
decision becomes available. Preferably, the prior claim construction is 
submitted with the petition or preliminary response, with explanations. 
After a trial is instituted, the PTAB's rules on supplemental 
information govern the timing and procedures for submitting claim 
construction decisions. See 37 CFR 42.123, 42.223. Under those rules, a 
party must first request authorization from the PTAB to file a motion 
to submit supplemental information. If it is more than one month after 
the date the trial is instituted, the motion must show why the 
supplemental information reasonably could not have been obtained 
earlier. Normally, the PTAB will permit such information to be filed, 
as long as the final oral hearing has not taken place. The PTAB may 
permit a later filing where it is not close to the one-year deadline 
for completing the trial. Again, parties should submit the prior claim 
construction as soon as the decision is available.
    Comment 38: One comment asked whether disclosure of prior claim 
construction determinations is optional or subject to mandatory 
disclosure under 37 CFR 42.51(b).
    Response: Submission of prior claim construction determinations is 
mandatory under 37 CFR 42.51(b), if it is ``relevant information that 
is inconsistent with a position advanced by the party during the 
proceeding.'' In such cases, the determinations should be submitted 
``concurrent with the filing of the documents or things that contains 
the inconsistency.'' Id.
    Comment 39: A comment suggested that the disclosure of any prior 
claim constructions by a court or the ITC or any claim constructions 
the parties or their privies have offered in a court proceeding or 
before the ITC be required.
    Response: The current requirement under 37 CFR 42.51(b) for 
disclosure of ``relevant information that is inconsistent with a 
position advanced by the party during the proceeding'' is sufficient. 
District court and ITC claim construction proceedings may involve terms 
that are not relevant to issues before the PTAB. To require disclosure 
of any term construed by a district court or the ITC would result in 
unnecessary filings and inefficiencies in identifying which terms, if 
any, are relevant to the trial before the PTAB. Rather, a prior claim 
construction must be submitted under 37 CFR 42.51(b), if it is 
``relevant information that is inconsistent with a position advanced by 
the party during the proceeding.''
    Comment 40: One comment asked whether, if the PTAB decides not to 
adopt prior claim constructions, the PTAB can make its own claim 
constructions. The comment further asked whether the PTAB can only make 
constructions asserted by the parties.
    Response: When applying the same Phillips standards as applied in 
federal court or the ITC, the PTAB may or may not adopt a construction 
that has been proposed by one of the parties. For example, the PTAB is 
not required to provide constructions that are unnecessary to the 
issues before it. In addition, where the PTAB makes a claim 
construction determination in its institution decision that differs 
from one asserted by the parties, the parties will be afforded an 
opportunity to brief the issue after institution.

Effective Date of the Rule Change

    Comment 41: Several comments opposed retroactive application of the 
rule and requested the proposed changes only apply to new proceedings 
filed some time period after announcement of the final rule. Concerns 
were expressed that retroactive application of the rule would be 
disruptive and would require significant time, effort, and expense to 
be spent by the parties (e.g., for supplemental briefing and additional 
testimony) and may unfairly prejudice petitioners that have filed 
petitions they may not have decided to file under the Phillips 
standard.
    Response: The Office appreciates the concerns that have been 
raised, and adopts the proposed change. While the Office believes the 
federal court claim construction standard to be the best standard to 
use going forward, given the concerns raised in the comments, the 
changes adopted in this final rule will only apply to petitions filed 
on or after the effective date of the final rule.
    Comment 42: A few comments raised concerns whether the Office has 
the authority to apply the new standard retroactively under the 
principles articulated in Bowen v. Georgetown Univ. Hosp., 109 S. Ct. 
468 (1988) and Landgraf v. USI Film Prods., 114 S. Ct. 1483 (1994).
    Response: The Office acknowledges the concerns and recognizes that 
a ``statutory grant of legislative rulemaking authority will not, as a 
general matter, be understood to encompass the power to promulgate 
retroactive rules unless that power is conveyed by Congress in express 
terms.'' Bowen, 109 S. Ct. at 472. The change in claim construction 
standard, as adopted in this final rule, will only be applied to 
petitions filed on or after the effective date of the rule.
    Comment 43: Several comments suggested the Phillips claim 
construction standard should apply to all proceedings over which the 
PTAB maintains jurisdiction upon the effective date of the final rule. 
The comments noted this would be consistent with existing practices 
under which parties to post-grant proceedings know that claim 
construction is subject to modification until the end of trial. 
Additionally, a few comments proposed the Phillips standard also be 
applied to

[[Page 51357]]

proceedings remanded from the Federal Circuit Court of Appeals.
    Response: The Office recognizes the desire of some commenters to 
apply the federal court standard as soon as possible to all 
proceedings. On balance, the Office has determined the rule changes set 
forth in this final rule will only apply to proceedings where a 
petition is filed on or after the effective date of the rule.
    Comment 44: Some comments expressed concern that, if the rule 
changes were applied prospectively only, a large number of petitions 
may be filed prior to the effective date of the rule changes by 
petitioners seeking to retain the BRI standard, which would strain 
administrative resources and could cause unnecessary delay.
    Response: The Office appreciates the comments. The rule changes 
adopted in this final rule are applicable to any petition filed on or 
after the effective date of the final rule. The Office does not 
anticipate an inordinate number of petitions to be filed during the 30 
day period from publication to effective date.
    Comment 45: A few comments suggested that, if the rule changes are 
applied to existing proceedings, the PTAB should provide the parties 
with the opportunity to file briefs directed to the impact of the 
change in the claim construction standard in their proceedings.
    Response: The Office agrees and has implemented the final rule such 
that the final rule applies only to petitions filed on or after the 
effective date. As such, petitioners will have an opportunity to fully 
brief the federal court claim construction standard in their petitions 
and patent owners will likewise have an opportunity to fully brief this 
issue in patent owner preliminary responses.

Additional Suggested Changes

    Comment 46: The Office has received a number of suggested changes 
to the current AIA proceedings. These suggested changes are directed to 
both procedural and statutory changes that go beyond the scope of this 
rulemaking. For example, the Office has received comments suggesting 
procedural and statutory changes such as handling motions to amend 
similar to ex parte reexamination, allowing more live testimony, 
limiting petitions to a single ground per claim, precluding hedge funds 
from filing petitions, denying multiple petitions against the same 
patent, using the substantial new question of patentability standard at 
institution, awarding attorney fees for small entities and changing the 
preponderance of the evidence burden of proof to a clear and convincing 
burden of proof.
    Response: The Office appreciates the comments received. The Office 
continues to undertake a wholesale examination of AIA proceedings to 
determine which areas need improvement and which areas are working 
well. The Office may take action in certain areas in the near future 
based on its own review and in light of input from the IP community, 
some of which may be reflected in the comments received. The Office 
will continue to study and make improvements to AIA proceedings as 
necessary to ensure a balanced system that meets the congressional 
intent of the AIA.
    Comment 47: The Office also has received a number of comments 
suggesting changes to ex parte examination, including reexamination and 
reissue examination procedures. For example, several comments have 
requested that the Office adopt a federal court claim construction 
standard for reexamination proceedings and reissue applications.
    Response: The Office appreciates the comments received; however, 
they are beyond the scope of the current rulemaking, which focuses on 
AIA proceedings. The Office will take these comments into account as 
the Office continually seeks to improve the examination process in 
order to provide high quality, efficient examination.

Rulemaking Considerations

    A. Administrative Procedure Act (APA): This final rule revises the 
rules relating to Office trial practice for IPR, PGR, and CBM 
proceedings. The changes set forth in this final rule will not change 
the substantive criteria of patentability. These rule changes involve 
rules of agency procedure and interpretation. See Perez v. Mortg. 
Bankers Ass'n, 135 S. Ct. 1199, 1204 (2015) (Interpretive rules 
``advise the public of the agency's construction of the statutes and 
rules which it administers.'' (citation and internal quotation marks 
omitted)); Bachow Commc'ns, Inc. v. F.C.C., 237 F.3d 683, 690 (D.C. 
Cir. 2001) (Rules governing an application process are procedural under 
the Administrative Procedure Act.); Inova Alexandria Hosp. v. Shalala, 
244 F.3d 342, 350 (4th Cir. 2001) (Rules for handling appeals were 
procedural where they did not change the substantive requirements for 
reviewing claims.); Nat'l Org. of Veterans' Advocates, Inc. v. Sec'y of 
Veterans Affairs, 260 F.3d 1365, 1375 (Fed. Cir. 2001) (Rule that 
clarifies interpretation of a statute is interpretive.); JEM Broad. Co. 
v. F.C.C., 22 F.3d 320, 328 (D.C. Cir. 1994) (Rules are not legislative 
because they do not ``foreclose effective opportunity to make one's 
case on the merits.'').
    Accordingly, prior notice and opportunity for public comment are 
not required pursuant to 5 U.S.C. 553(b) or (c) (or any other law). See 
Perez, 135 S. Ct. at 1206 (Notice-and-comment procedures are required 
neither when an agency ``issue[s] an initial interpretive rule'' nor 
``when it amends or repeals that interpretive rule.''); Cooper Techs. 
Co. v. Dudas, 536 F.3d 1330, 1336-37 (Fed. Cir. 2008) (stating that 5 
U.S.C. 553, and thus 35 U.S.C. 2(b)(2)(B), do not require notice and 
comment rulemaking for ``interpretative rules, general statements of 
policy, or rules of agency organization, procedure, or practice'' 
(quoting 5 U.S.C. 553(b)(3)(A))).
    The Office, nevertheless, published the notice of proposed 
rulemaking for comment as it sought the benefit of the public's views 
on the Office's proposed changes to the claim construction standard for 
reviewing patent claims and proposed substitute claims in AIA 
proceedings before the Board. See 83 FR 21221.
    B. Regulatory Flexibility Act: For the reasons set forth herein, 
the Deputy General Counsel for General Law of the United States Patent 
and Trademark Office has certified to the Chief Counsel for Advocacy of 
the Small Business Administration that changes in this final rule will 
not have a significant economic impact on a substantial number of small 
entities. See 5 U.S.C. 605(b).
    This final rule revises certain rules and trial practice procedures 
before the Board. Any requirements resulting from these changes are of 
minimal or no additional burden to those practicing before the Board.
    For the foregoing reasons, the changes in this final rule will not 
have a significant economic impact on a substantial number of small 
entities.
    C. Executive Order 12866 (Regulatory Planning and Review): This 
rulemaking has been determined to be significant, for purposes of 
Executive Order 12866 (Sept. 30, 1993).
    D. Executive Order 13563 (Improving Regulation and Regulatory 
Review): The Office has complied with Executive Order 13563. 
Specifically, the Office has, to the extent feasible and applicable: 
(1) Made a reasoned determination that the benefits justify the costs 
of the rule; (2) tailored the rule to impose the least burden on 
society consistent with obtaining the regulatory objectives; (3) 
selected a regulatory approach that maximizes net benefits;

[[Page 51358]]

(4) specified performance objectives; (5) identified and assessed 
available alternatives; (6) involved the public in an open exchange of 
information and perspectives among experts in relevant disciplines, 
affected stakeholders in the private sector and the public as a whole, 
and provided on-line access to the rulemaking docket; (7) attempted to 
promote coordination, simplification, and harmonization across 
government agencies and identified goals designed to promote 
innovation; (8) considered approaches that reduce burdens and maintain 
flexibility and freedom of choice for the public; and (9) ensured the 
objectivity of scientific and technological information and processes.
    E. Executive Order 13771 (Reducing Regulation and Controlling 
Regulatory Costs): This rule is not subject to the requirements of E.O. 
13771 because this rule results in no more than de minimis costs.
    F. Executive Order 13132 (Federalism): This rulemaking does not 
contain policies with federalism implications sufficient to warrant 
preparation of a Federalism Assessment under Executive Order 13132 
(Aug. 4, 1999).
    G. Executive Order 13211 (Energy Effects): This rulemaking is not a 
significant energy action under Executive Order 13211 because this 
rulemaking is not likely to have a significant adverse effect on the 
supply, distribution, or use of energy. Therefore, a Statement of 
Energy Effects is not required under Executive Order 13211 (May 18, 
2001).
    H. Executive Order 12988 (Civil Justice Reform): This rulemaking 
meets applicable standards to minimize litigation, eliminate ambiguity, 
and reduce burden as set forth in sections 3(a) and 3(b)(2) of 
Executive Order 12988 (Feb. 5, 1996).
    I. Executive Order 13045 (Protection of Children): This rulemaking 
does not concern an environmental risk to health or safety that may 
disproportionately affect children under Executive Order 13045 (Apr. 
21, 1997).
    J. Executive Order 12630 (Taking of Private Property): This 
rulemaking will not affect a taking of private property or otherwise 
have taking implications under Executive Order 12630 (Mar. 15, 1988).
    K. Congressional Review Act: Under the Congressional Review Act 
provisions of the Small Business Regulatory Enforcement Fairness Act of 
1996 (5 U.S.C. 801 et seq.), prior to issuing any final rule, the 
United States Patent and Trademark Office will submit a report 
containing the rule and other required information to the United States 
Senate, the United States House of Representatives, and the Comptroller 
General of the Government Accountability Office. The changes in this 
final rule are not expected to result in an annual effect on the 
economy of 100 million dollars or more, a major increase in costs or 
prices, or significant adverse effects on competition, employment, 
investment, productivity, innovation, or the ability of United States-
based enterprises to compete with foreign-based enterprises in domestic 
and export markets. Therefore, this rulemaking is not a ``major rule'' 
as defined in 5 U.S.C. 804(2).
    L. Unfunded Mandates Reform Act of 1995: The changes in this final 
rule do not involve a Federal intergovernmental mandate that will 
result in the expenditure by State, local, and tribal governments, in 
the aggregate, of 100 million dollars (as adjusted) or more in any one 
year, or a Federal private sector mandate that will result in the 
expenditure by the private sector of 100 million dollars (as adjusted) 
or more in any one year, and will not significantly or uniquely affect 
small governments. Therefore, no actions are necessary under the 
provisions of the Unfunded Mandates Reform Act of 1995. See 2 U.S.C. 
1501 et seq.
    M. National Environmental Policy Act: This rulemaking will not have 
any effect on the quality of the environment and is thus categorically 
excluded from review under the National Environmental Policy Act of 
1969. See 42 U.S.C. 4321 et seq.
    N. National Technology Transfer and Advancement Act: The 
requirements of section 12(d) of the National Technology Transfer and 
Advancement Act of 1995 (15 U.S.C. 272 note) are not applicable because 
this rulemaking does not contain provisions which involve the use of 
technical standards.
    O. Paperwork Reduction Act: The Paperwork Reduction Act of 1995 (44 
U.S.C. 3501-3549) requires that the Office consider the impact of 
paperwork and other information collection burdens imposed on the 
public. This final rule involves information collection requirements 
which are subject to review by the Office of Management and Budget 
(``OMB'') under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3549). This rulemaking does not add any additional information 
requirements or fees for parties before the Board. Therefore, the 
Office is not resubmitting information collection packages to OMB for 
its review and approval because the revisions in this rulemaking do not 
materially change the information collections approved under OMB 
control number 0651-0069.
    Notwithstanding any other provision of law, no person is required 
to respond to, nor shall any person be subject to, a penalty for 
failure to comply with a collection of information subject to the 
requirements of the Paperwork Reduction Act unless that collection of 
information displays a currently valid OMB control number.

List of Subjects in 37 CFR Part 42

    Administrative practice and procedure, Inventions and patents.

    For the reasons set forth in the preamble, the Office amends part 
42 of title 37 as follows:

PART 42--TRIAL PRACTICE BEFORE THE PATENT TRIAL AND APPEAL BOARD

0
1. The authority citation for 37 CFR part 42 continues to read as 
follows:

    Authority: 35 U.S.C. 2(b)(2), 6, 21, 23, 41, 135, 311, 312, 316, 
and 321-326; Public Law 112-29, 125 Stat. 284; and Pub. L. 112-274, 
126 Stat. 2456.

0
2. Amend Sec.  42.100 by revising paragraph (b) to read as follows:


Sec.  42.100  Procedure; pendency.

* * * * *
    (b) In an inter partes review proceeding, a claim of a patent, or a 
claim proposed in a motion to amend under Sec.  42.121, shall be 
construed using the same claim construction standard that would be used 
to construe the claim in a civil action under 35 U.S.C. 282(b), 
including construing the claim in accordance with the ordinary and 
customary meaning of such claim as understood by one of ordinary skill 
in the art and the prosecution history pertaining to the patent. Any 
prior claim construction determination concerning a term of the claim 
in a civil action, or a proceeding before the International Trade 
Commission, that is timely made of record in the inter partes review 
proceeding will be considered.
* * * * *

0
3. Amend Sec.  42.200 by revising paragraph (b) to read as follows:


Sec.  42.200  Procedure; pendency.

* * * * *
    (b) In a post-grant review proceeding, a claim of a patent, or a 
claim proposed in a motion to amend under Sec.  42.221, shall be 
construed using the same claim construction standard that would be used 
to construe the claim in a civil action under 35 U.S.C. 282(b), 
including construing the claim in accordance with the ordinary and 
customary meaning of such claim as understood by one of

[[Page 51359]]

ordinary skill in the art and the prosecution history pertaining to the 
patent. Any prior claim construction determination concerning a term of 
the claim in a civil action, or a proceeding before the International 
Trade Commission, that is timely made of record in the post-grant 
review proceeding will be considered.
* * * * *

0
4. Amend Sec.  42.300 by revising paragraph (b) to read as follows:


Sec.  42.300  Procedure; pendency.

* * * * *
    (b) In a covered business method patent review proceeding, a claim 
of a patent, or a claim proposed in a motion to amend under Sec.  
42.221, shall be construed using the same claim construction standard 
that would be used to construe the claim in a civil action under 35 
U.S.C. 282(b), including construing the claim in accordance with the 
ordinary and customary meaning of such claim as understood by one of 
ordinary skill in the art and the prosecution history pertaining to the 
patent. Any prior claim construction determination concerning a term of 
the claim in a civil action, or a proceeding before the International 
Trade Commission, that is timely made of record in the covered business 
method patent review proceeding will be considered.
* * * * *

    Dated: October 3, 2018.
Andrei Iancu,
Under Secretary of Commerce for Intellectual Property and Director of 
the United States Patent and Trademark Office.
[FR Doc. 2018-22006 Filed 10-10-18; 8:45 am]
 BILLING CODE 3510-16-P