Pan et al.v.Flusberg et al. V. Flusberg et al.

Patent Trial and Appeal Board

Aug 3, 2016

13633673 (P.T.A.B. Aug. 3, 2016)

BoxInterferences@uspto.gov
Telephone: 571-272-7822 Entered: August 3, 2016
UNITED STATES PATENT AND TRADEMARK OFFICE

BEFORE THE PATENT TRIAL AND APPEAL BOARD

Patent Interference No. 105,970

INDUSTRIAL TECHNOLOGY RESEARCH INSTITUTE
and Ti-Shiue Biotech, Inc.
Junior Party
(US 8,846,630)

v.

PACIFIC BIOSCIENCES
of California, Inc.
Senior Party
(Applications 13/633,673 and 13/930,178)

Before RICHARD E. SCHAFER, SALLY GARDNER LANE, and
JAMES T. MOORE, Administrative Patent Judges.

SCHAFER, Administrative Patent Judge.
Judgment - Order to Show Cause - 37 CFR § 41.202(d)

The parties were put under an Order to Show Cause why judgment should
not be entered against them. Paper 177. Only Pacific BioSciences (PacBio) filed a
response. Paper 178. The Panel has reviewed PacBio’s response and holds that
PacBio failed to show cause why judgment should not be entered against it. Paper
183. Accordingly, we enter judgment against both parties. It is-
ORDERED that judgment is entered against Claims 1-22 and 24-28 of
Industrial Technology Research Institute (ITRI) Patent 8,846,630;
2

FURTHER ORDERED that ITRI is not entitled a patent including the
subject matter of Claims 1-22 and 24-28 of Patent 8,846,630;
FURTHER ORDERED that Claims 1-22 and 24-28 of Patent 8,846,630 are
cancelled (35 U.S.C. § 134(a));
FURTHER ORDERED that judgment is entered against Claim 1 of PacBio
Application 13/633,673 and Claims 1-4 of PacBio Application 13/930,178;
FURTHER ORDERED that PacBio is not entitled to a patent including the
subject matter of Claim 1 of Application 13/633,673 and Claims 1-4 Application
13/930,178;
FURTHER ORDERED that Claim 1 of Application 13/633,673 and Claims
1-4 Application 13/930,178 are finally refused (35 U.S.C. § 134(a));
FURTHER ORDERED that a copy of this judgment be entered into the
administrative records of Patent 8,846,630 and Applications 13/633,673 and
13/930,178; and
FURTHER ORDERED that a party seeking judicial review timely promptly
serve notice on the Director of the United States Patent and Trademark Office
(37 C.F.R. § 41.8(b)) and file a copy of the notice in the record of this
interference.1
2

1 Attention is directed to Biogen Idec MA, Inc., v. Japanese Foundation for
Cancer Research, 758 F.3d 647 (Fed. Cir. 2015) cert. denied 2016 WL 1078942
(March 21, 2016).

NOTICE: “Any agreement or understanding between parties to an interference,
including any collateral agreements referred to therein, made in connection with or
in contemplation of the termination of the interference, shall be in writing and a
true copy thereof filed in the Patent and Trademark Office before the termination
of the interference as between the said parties to the agreement or understanding.”
35 U.S.C. 135(c); see also 37 C.F.R. § 41.205 (settlement agreements).

3

cc (electronic delivery):
Attorney for ITRI:
David S. Forman
M. Paul Barker
Finnegan, Henderson, Farabow,
Garrett & Dunner, LLP
david.forman@finnegan.com
paul.barker@finnegan.com

Attorney for PacBio:
Michael S. Tuscan
Bonnie Weiss McLeod
Colley, LLP
mtuscan@cooley.com
bweissmcleod@cooley.com
zpatdocketing@cooley.com

BoxInterferences@uspto.gov
Telephone: 571-272-7822 Entered: August 3, 2016
UNITED STATES PATENT AND TRADEMARK OFFICE

BEFORE THE PATENT TRIAL AND APPEAL BOARD

Patent Interference No. 105,970

INDUSTRIAL TECHNOLOGY RESEARCH INSTITUTE
and Ti-Shiue Biotech, Inc.
Junior Party
(US 8,846,630)

v.

PACIFIC BIOSCIENCES
of California, Inc.
Senior Party
(Applications 13/633,673 and 13/930,178)

Before RICHARD E. SCHAFER, SALLY GARDNER LANE, and
JAMES T. MOORE, Administrative Patent Judges.

SCHAFER, Administrative Patent Judge.
Decision - Order to Show Cause
This interference is between Industrial Technology Research Institute (ITRI) 1
Patent 8,846,630 (‘630) and Pacific Biosciences of California, Inc. (PacBio) 2
Applications 13/633,673(‘673) and 13/930,178 (‘178). 3
As a result of a Decision on Motions, entered May 31, 2016 (Paper 178), the 4
parties were ordered to show cause why a judgment against ITRI’s Claims 1-22 5
and 24-28 of ITRI’s ‘630 Patent and Claim 1 of PacBio Application 13/633,673 6
and Claims 1-4 of PacBio Application 13/930,178 should not be entered. Paper 7

2

177. PacBio has filed a paper responding to the Order (Response to OC) and 1
requesting reconsideration of the portion of our opinion that it failed to overcome 2
the presumption of cross-applicability under 37 C.F.R. § 41.207(c). Response to 3
OC, Paper 178, 1: 4-7. PacBio specifically requests that we confirm that it has 4
rebutted the presumption of cross-applicability of the prior art of 37 C.F.R. 5
§ 41.207(c) and that Claim 1 of Application 13/633,673 (‘673) and Claims 1-4 6
Application 13/930,178 (‘178) are patentable. In the alternative, PacBio requests 7
authorization to file a motion to change the inventorship of its involved 8
application. Response to OC, Paper 178, 1:7-10.1 9
ITRI did not respond to the Order to Show Cause. 10
We hold that PacBio has failed to show sufficient cause why judgment 11
should not be entered against its involved claims. While we have reconsidered our 12
opinion, we decline to make any changes. We do not authorize a motion to change 13
inventorship. A judgment against both parties shall be issued in a separate paper. 14
I. 15
On appeal of the Board’s Judgment (Paper 168) and Decision on Motions 16
entered September 3, 2014 (Paper 167), the Federal Circuit remanded to further 17
address the cross-applicability issue: 18
On this record, it is unclear whether the Board implicitly 19
determined that PacBio has overcome the presumption of cross-20
applicability or whether the Board decided not to apply the 21
prior art to PacBio's claims for some other reason. Because we 22
affirm the obviousness determination as to claims 1–22 and 24–23
26 of ITRI's ′630 patent and remand the case for further 24
determinations as to claims 23, 27, and 28 of that patent, the 25
Board will have another opportunity to address the cross- 26
applicability issue. 27

1 PacBio has not asserted any other reasons why this interference should be
continued and judgment should not be entered against it.

3

Industrial Technology Research Institute v. Pacific Biosciences of California, Inc., 1
___ Fed. Appx. ___, ___; 2016 WL 363518 at *10 (Fed. Cir. 2016). The Court 2
went on to note that 3
35 U.S.C. § 103(c) provides that § 102(e) prior art does not 4
preclude patentability if “the subject matter [of the prior art] 5
and the claimed invention were, at the time the claimed 6
invention was made, owned by the same person or subject to an 7
obligation of assignment to the same person” (emphasis added). 8
Accordingly, evidence of common ownership by assignment 9
after the application filing date does not establish common 10
ownership or an obligation to assign ownership at the time of 11
the invention. 12
Id. at *11. 13
As a result of and in the light of the Federal Circuit’s remand on cross-14
applicability of the prior art, we carried out a de novo review of PacBio’s and 15
ITRI’s arguments and evidence relating to overcoming the presumption of 37 16
C.F.R. § 41.207(c). We considered PacBio’s Motion 2 (Paper 56), ITRI’s 17
Opposition 2 (Paper 132), and PacBio’s Reply 2 (Paper 144), including the Moore 18
declaration on co-ownership (Ex. 1027).2 19
PacBio’s Motion 2 had argued that Patent 8,153,375 (‘375), which was 20
applied with additional references against ITRI’s involved claims, was excluded by 21
35 U.S.C. § 103(c)(1) from the relevant prior art. Motion 2, Paper 56, 15:1-10. 22
According to PacBio, the subject matter of the ‘375 patent and the subject matter 23
of its involved claims were commonly owned at the time the claimed invention 24
was made: 25
[N]either the '375 patent nor its corresponding published 26
application can be cited as prior art under§ 103 against Pacific 27

2 We have considered PacBio’s evidence and arguments in its Reply 2 and Moore
Declaration (Ex. 1027) on § 103(c)(1), notwithstanding that they may have raised
new issues. See 37 C.F.R. § 41.122(b).

4

Biosciences' '673 and '178 applications, because the subject 1
matter is and was co-owned by Pacific Biosciences at the time 2
the invention was made. 3
Motion 2, Paper 56, 15:8-10. 4
Our decision held that PacBio had not provided sufficient evidence to prove 5
that the “[prior art] subject matter and the claimed invention were, at the time the 6
claimed invention was made, owned by the same person or subject to an obligation 7
of assignment to the same person” as required by 35 U.S.C. § 103(c)(1). Decision 8
on Motions, Paper 176, 15:11-14. 9
Because PacBio’s argument on co-ownership in its Reply 2 and the Moore 10
Declaration depended upon a different inventorship than stated in its applications, 11
we reviewed its proofs on inventorship of its involved claims. We held that those 12
proofs were not sufficient to establish that Turner, Sorenson, Travers and Heiner, 13
as opposed to the eleven inventors named in PacBio’s applications, were the actual 14
inventors of that subject matter. Id. at 16:21-28. That decision rested largely upon 15
the finding that the declarant based his testimony on information and belief, not 16
objective evidence. Id. 15–16. 17
II. 18
A. 19
PacBio cites to an Official Gazette Notice titled “Guidelines Setting Forth a 20
Modified Policy Concerning the Evidence of Common Ownership, or an 21
Obligation of Assignment to the Same Person, as Required by 35 U.S.C. 103(c)” 22
(Guidelines). Response to OC., Paper 178, 7:29 – 8:26. The Guidelines were 23
published at 1241 Official Gazette 95, December 26, 2000. The Guidelines are of 24
record as Paper 159. PacBio relies on the Guidelines as establishing that its 25
Motion 2 was sufficient to establish co-ownership for the purposes of the exclusion 26
of 35 U.S.C. § 103(c)(1). Response to OC, Paper 178, 8:8-13. PacBio’s Motion 2 27

5

noted that the ‘375 patent qualified as prior art under 35 U.S.C. § 102(e) and then 1
argued: 2
According to 35 U.S.C. § 103(c)(l), “Subject matter developed 3
by another person, which qualifies as prior art only under one 4
or more of subsections (e), (f), and (g) of section 102 of this 5
title, shall not preclude patentability under this section where 6
the subject matter and the claimed invention were, at the time 7
the claimed invention was made, owned by the same person or 8
subject to an obligation of assignment to the same person.” 9
Therefore, neither the '375 patent nor its corresponding 10
published application can be cited as prior art under§ 103 11
against Pacific Biosciences' '673 and' 178 applications, because 12
the subject matter is and was co-owned by Pacific Biosciences 13
at the time the invention was made. 14
PacBio Motion 2, Paper 56, 15:3-10 (emphasis added). 15
PacBio did not cite to the Guidelines as authority supporting its co-16
ownership position in its Motion 2. According to PacBio, the Guidelines set forth 17
the PTO Policy that “applicant(s) or the representative(s) of record have the best 18
knowledge of the ownership of their application(s) and references(s), and their 19
statement of such is sufficient evidence because of their paramount obligation of 20
candor and good faith to the USPTO.[3]” Response to OC, Paper 178, 7:29 – 8:26 21
quoting Paper 159 at 3. 22
We fail to see the relevance of the Guidelines to this adversarial inter partes 23
proceeding. The document presents guidance to patent examiners that was issued 24
by Stephen G. Kunin, then Deputy Commissioner for Patent Examination Policy. 25

3 This statement in the Guidelines merely reflects the heightened responsibilities
placed upon counsel during ex parte examination. As stated in the current
regulations governing representation of others before PTO (37 C.F.R. Part 11): “In
an ex parte proceeding, a practitioner shall inform the tribunal of all material facts
known to the practitioner that will enable the tribunal to make an informed
decision, whether or not the facts are adverse.” 37 C.F.R. § 11.303(d).

6

The purpose of the Guidelines is to assist patent examiners conducting ex parte 1
examination. For example, the Guidelines state: 2
Henceforth, applications and references (whether patents, patent 3
applications, patent application publications, etc.) will be 4
considered by the examiner to be owned by, or subject to an 5
obligation of assignment to, the same person, at the time the 6
invention was made, if the applicant(s) or the attorney or agent 7
of record makes a statement to the effect that the application 8
and the reference were, at the time the invention was made, 9
owned by, or subject to an obligation of assignment to, the 10
same person. 11
Guidelines, Paper 159, p.1 (emphasis added). The Guidelines provide no 12
indication that they are applicable outside the context of ex parte examination. The 13
Guidelines make no reference to the Board or to interference proceedings. 14
An interference, because of its inter partes nature, is more complicated and 15
requires more rigorous proofs than ex parte examination.4 This is necessarily so 16
because Interferences are adversarial with each party attempting to deprive its 17
opponent of a patent on an invention that, subject to the result of the interference, 18
has been determined to be patentable. An interference may result in one or both 19
parties losing rights to an otherwise patentable invention. A party’s patent claims 20
may be cancelled and/or a party’s application claims finally refused. 35 U.S.C. § 21
135(a). Indeed, PacBio copied ITRI’s claims and sought this interference to 22
challenge ITRI’s right to its patented claims. See Application 13/633,673, 23
Miscellaneous Incoming Letter filed October 2, 2012. 24
The more complicated and rigorous nature of the proceeding is apparent 25
from the PTO’s interference regulations (37 C.F.R. § 41.100 et seq. and § 41.200 26

4 An noted in Schulze v. Green, 136 F.3d 786, 791 n.5, the fact that it is more
complicated to establish a matter inter parte as opposed to ex parte stems directly
from the 1984 legislation unifying the former Board of Appeals and Board of
Patent Interferences.

7

et seq.) and Standing Order (Paper 2). In an interference, a challenge to 1
patentability requires filing a motion. The movant has the burden of proof to 2
establish that it is entitled to the requested relief. 37 C.F.R. § 41.121(b). To meet 3
that burden, the motion must be supported with appropriate evidence such that, if 4
the evidence were unrebutted, it would justify the relief sought. 37 C.F.R. 5
§ 41.208(b). In other words, the motion must be supported with argument and 6
evidence sufficient to establish prima facie entitlement to the relief requested. 7
The motion must include a full statement of the reasons for the requested 8
relief including a detailed explanation of the significance of the evidence, the 9
governing law, the rules and applicable precedent. 37 C.F.R. § 41.121(c)(iii). The 10
evidence submitted must be admissible under the Federal Rules of Evidence. 37 11
C.F.R. §§ 41.151 and 41.152. Motions must include a statement of material facts. 12
37 C.F.R. § 41.121(c)(ii). “[E]ach material fact shall be set forth as a separate 13
numbered sentence with specific citations to the portions of the record that support 14
the fact.” 37 C.F.R. § 41.121(d)(1). The citation to the evidence relied upon must 15
be specific. S.O., Paper 2, ¶ 121.5.2. Declaration testimony filed in support of the 16
motion is subject to cross examination. 37 C.F.R. § 41.157; SO ¶ 157.3 et seq. 17
In light of the detailed procedures set out in the Board’s regulations and 18
Standing Order, the mere unsupported assertion by counsel that the subject matter 19
of the prior art and the claimed invention were commonly owned, or subject to 20
assignment, at the time the invention was made, while potentially sufficient for the 21
purposes of ex parte examination, does not meet the specific evidentiary 22
requirements of the interference rules. PacBio has not directed us to any basis for 23
its position that the Guidelines with respect to § 103(c)(1) directed to patent 24
examiners trump the specific requirements of the PTO regulations relating to 25
interference proceedings. In light of the specific regulations governing 26

8

interferences and the Standing Order, PacBio’s reliance on the Guidelines for ex 1
parte application examination is simply not reasonable in the interference context.5 2
Additionally, our Decision on Motions (Paper 176) noted that PTO records 3
show that the assignments by the inventors named in the applications were made 4
after the apparent effective filing date of the ‘673 and ‘178 applications.6 Decision 5
on Motions, Paper 176, 14:11-21. Thus, even if PacBio had made the statement 6
relating to co-ownership at the time the invention was made during ex parte 7
examination of its applications, the PTO records on the assignments would 8
constitute “independent evidence that raises material doubt as to the accuracy of 9
[PacBio’s] representation of . . . common ownership . . . .” Guidelines, Paper 159, 10
p. 3. As further noted in the Guidelines: 11
In such cases, the examiner may . . . require objective evidence 12
of common ownership of, or the existence of an obligation to 13
assign, the application being examined and the applied 14
reference as of the date of invention of the application being 15
examined. 16
Id. Thus, even in a strictly ex parte context before an examiner, it appears that 17
PacBio’s assertion of co-ownership in its Motion 2 likely would not have been 18
sufficient to prove that the ‘375 and the claimed invention were commonly 19
owned or subject to an obligation of assignment to the same person. 20

5 PacBio directs us to a number of decisions by this Board in ex parte appeals.
Response to OC, Paper 178, 8:14-15. For the reasons we have already stated with
respect to the Guidelines, those cases have no relevance to this inter partes
proceeding.
6 The Federal Circuit noted: “[E]vidence of common ownership by assignment
after the application filing date does not establish common ownership or an
obligation to assign ownership at the time of the invention.” Industrial Tech., ___
Fed. Appx. at ___; 2016 WL 363518 at *11

9

B. 1
The Moore declaration (Ex. 1027) and the employment agreements (Exhibits 2
A, C, D, and F attached to Ex. 1027) fail to cure the insufficiencies of Motion 2 to 3
prove co-ownership. Moore testified that “on information and belief” Turner, 4
Sorenson, Travers and Heiner were the proper inventors. As apparently recognized 5
by PacBio in asserting inventorship as part of Moore’s testimony, inventorship is 6
central to ownership. Ownership springs from invention. Teets v. Chromalloy Gas 7
Turbine Corp., 83 F.3d 403, 407 (Fed. Cir. 1996). The patent laws reward 8
individuals for contributing to the progress of science and the useful arts. See U.S. 9
Const. art. I, Section 8. As part of that reward, an invention presumptively belongs 10
to its creator. See Beech Air craft Corp. v. EDO Corp. , 990 F.2d 1237, 1248 11
(Fed.Cir. 1993); Arachnid, Inc. v. Merit Indus., Inc., 939 F.2d 1574, 1578 (Fed.Cir. 12
1991). However, in light of the declarations on inventorship filed by the inventors 13
named in PacBio’s applications, the mere statement that based upon “information 14
and belief” that the inventors are different is not sufficient to prove that the 15
inventors of the claimed subject matter were Turner, Sorenson, Travers and Heine. 16
As we noted in our Decision (Paper 167): 17
PacBio has not provided sufficient evidence to establish that 18
Turner, Sorenson, Travers and Heiner, are the inventors of the 19
subject matter of the count. Moore only makes the conclusory 20
statement that “based on information and belief” they are the 21
inventors. He has not directed us to any evidence to support his 22
testimony (Cf. 37 C.F.R. 1.63(a)(4)) or provided an explanation 23
of his basis for making the determination that the four 24
individuals were the inventors of the subject matter of the 25
count. 26
Decision on Motions, Paper 167, 16:21-28. 27
C. 28

10

PacBio argues to the effect that it was not allowed to address inventorship. 1
It points out that it sought authorization to file a motion to correct or amend 2
inventorship, and that while the motion was not authorized, it was deferred to the 3
priority phase. Response to OC, Paper 178, 2:1-3. 4
As explained below, PacBio was not authorized to file a motion directed to 5
inventorship because it did not provide an adequate explanation why inventorship 6
needed to be resolved in the interference. We also fail to see where in the record a 7
motion on inventorship was deferred to the priority phase; rather, it was always 8
subject to being raised at an appropriate time during the interference. 9
1. 10
Pursuant to 37 C.F.R. § 41.120(a) the “Board may require a party to provide 11
a notice stating the relief it requests and the basis for its entitlement to relief.” The 12
Notice of Declaration set a time for the parties to file motions lists. Declaration, 13
Paper 1, p. 2. A Motions List is a notice stating the motions a party would like to 14
file and must include sufficient detail to place the Board and the opponent on 15
notice of the precise relief desired. 37 C.F.R. § 41.204(b). As stated in the 16
Standing Order: 17
The motions list is a tool for planning the course of the 18
proceeding, eliminating unnecessary costs and delay, and 19
avoiding abusive practices. All substantive and anticipated 20
responsive motions must be listed on the motions list. No 21
substantive motions or responsive motions may be filed without 22
prior Board authorization. 23
Standing Order, Paper 2, ¶ 204. “An accurate motions lists is necessary to provide 24
the Board and the opposing parties adequate notice to plan the proceeding.” Id., 25
¶ 120. The parties’ motions lists also permit the Board to determine whether the 26
listed motions are both necessary and sufficient to resolve the issues raised. Id., 27
¶ 104.2.1. 28

11

PacBio’s motion list sought authorization to file, inter alia, a motion for 1
judgment that ITRI’s involved claims were unpatentable under 35 U.S.C. § 103(a) 2
in view of one or more of thirty-four identified references. PacBio Motion List, 3
Paper 19, 3:1 – 5:16. The references included PacBio’s ‘375 patent. PacBio 4
Motion List, Paper 19, 3:7-8. The listing also requested authorization to file a 5
motion to change inventorship. PacBio Motion List, Paper 19, 5:17-18. The 6
motion list did not explain a basis or reason why PacBio’s inventorship needed to 7
be changed. Id. 8
During a conference call to discuss the parties’ proposed motions, the APJ 9
asked how and why PacBio expected to change inventorship. Transcript 10
December 9, 2013 Conference Call, Paper 23, 17:10-14. PacBio stated that the 11
inventorship need to be changed because of amendments to its claims required by 12
the examiner before the examiner would forward the application to the Board for 13
consideration of an interference. Transcript December 9, 2013 Conference Call, 14
Paper 23, 17:10-14. See also PacBio Opposition to Motion to Strike Reply 2, 15
Paper 162, 3:1-9 (“The Examiner requested certain claim amendments, including 16
the cancellation of all claims but claim 1 [of Application 13/633,673], which 17
necessitated PacBio’s change [of] inventorship.”). PacBio, however, did not 18
indicate that it might need to address inventorship in its prior art motion in order to 19
rebut the presumption of cross-applicability of prior art under 37 C.F.R. § 20
41.207(c). 21
PacBio was then authorized to file a motion asserting unpatentability of 22
ITRI’s claims. Order Authorizing Motions, Paper 22, pp. 2-3. However, the APJ 23
did not authorize a motion addressing inventorship as PacBio did not offer a 24
compelling reason for its need. The APJ, therefore, did not see a reason that 25
inventorship needed to be addressed in the interference: 26

12

This sort of gets back to the question of whether this is 1
something we need to do here. So one possibility is you're 2
changing the inventorship simply because it is based on your 3
investigations wrong. If ITRI is not moving for judgment that 4
the inventorship is wrong then that's something that you could 5
solve much less expensively before the examiner. 6
A second possibility is when we get into priority you 7
need that former inventor to be available as a corroborating 8
witness, in which case it's something that perhaps we need to 9
deal with now. I'm trying to see if this is really an issue that 10
needs to get resolved, if it's necessary to do anything to tee up 11
the priority case. 12
Transcript December 9, 2013 Conference Call, Paper 23, 20: 3-17 (emphasis 13
added). The APJ did not authorize an inventorship motion but said that PacBio 14
could again request authorization to file an inventorship motion if it became 15
apparent that it was necessary to change inventorship of its involved applications 16
during the interference: 17
I'm not going to authorize it at this point. It's going to be without 18
prejudice to your requesting it if a reason arises why it needs to come 19
up during the interference. 20
Transcript of December 9, 2013 Conference Call, Paper 23, 21:1-4 (emphasis 21
added). 22
In the Order authorizing motions, the APJ further explained: 23
The discussion during the telephone hearing suggests that the 24
motion is premature. The motion is NOT AUTHORIZED at 25
this time, but [PacBio] may renew its request if it has a basis 26
that needs to be resolved in this interference. 27
Order Authorizing Motions, Paper 22, p. 3 (emphasis added). 28
PacBio filed its unpatentability motion—its Motion 2 (Paper 56). In 29
addressing the presumption of cross-applicability of the cited art of 37 C.F.R. 30
§ 41.207(c), PacBio asserted that the ‘375 patent could not be applied because of 31
the co-owenership exclusion of § 103(c)(1). 32

13

ITRI filed its Opposition 2, arguing that PacBio had not proved co-1
ownership. Subsequently, PacBio requested a telephone conference in response to 2
ITRI’s argument that PacBio had not proved co-ownership at the time the 3
invention was made. Transcript of Conference Call, June 2, 2014, Paper 142. 4
PacBio sought and received authorization to file additional evidence on co-5
ownership. Id. at 15:14-19. During the conference Counsel for PacBio stated: 6
[W]e are willing to bring in additional evidence in the form of a 7
declaration or other that shows co-ownership between the '375 8
patent and the involved application[s] of the Pacific Biosciences 9
at the time of the invention, if needed. 10
Id. PacBio also stated that it in light of ITRI’s opposition asserting a lack of proof 11
on co-ownership, it was “looking for guidance and if need be permission to submit 12
the additional evidence if you think it's required.” Transcript of Conference Call, 13
June 2, 2014, Paper 142, 16:9-16. The APJ advised PacBio that it needed to 14
provide evidence of co-ownership: 15
As far as the [co-ownership] issue goes, this is probably a 16
reasonably foreseeable issue and yet you probably should be 17
putting in evidence. 18
Id at 17:15-18. During the conference call, PacBio did not raise the issue that a 19
different inventorship for its claimed subject matter was central to proving co-20
ownership for the purposes of the § 103(c)(1) exclusion. The APJ authorized the 21
filing of an additional declaration on co-ownership with PacBio’s Reply 2. Order 22
authorizing declarations, Paper 141, p. 2. PacBio was cautioned against raising 23
new issues and that its reply should be narrowly focused on the matters raised in 24
the opposition. Id. See 37 C.F.R. § 41.122(b). 25
PacBio filed its Reply 2 along with the Moore declaration. Paper 144 and 26
Ex. 1027. As the basis for the exclusion under § 103(c)(1) the declaration asserted 27
an inventorship for PacBio’s involved claims different than that stated in its 28

14

application.7 Ex. 1027, 2:6-7 and Ex. 3001. PacBio, however, did not seek 1
authorization to file a motion directed to correcting its inventorship. At least by 2
the time it filed its Reply 2, it had “a basis [for proving inventorship] that needs to 3
be resolved in this interference.” Order Authorizing Motions, Paper 22, p. 3. 4
Thus, PacBio was not precluded from filing a motion to address 5
inventorship. Although its § 103(c)(1) position required proving the inventorship 6
of its involved claims, it did not seek authorization to file a motion on 7
inventorship, despite the APJ’s admonition to do so “if a reason arises why it 8
needs to come up during the interference.” See Transcript of December 9, 2013 9
Conference Call, Paper 23, 21:1-4; Order Authorizing Motions, Paper 22, p. 3. 10
2. 11
Nor do we agree with PacBio’s argument for relief based upon its belief that 12
a motion on inventorship was simply deferred until the priority phase of the 13
interference. PacBio argues: 14
PacBio's request for a motion to correct inventorship was not 15
authorized, the issue being deferred until the priority phase, and 16
the record will show that this deferral continued despite the 17
Board permitting PacBio to address common ownership. 18
Response to OC, Paper 178, 2:1-6. PacBio directs us to a statement made in the 19
decision on ITRI’s motion to strike PacBio’s Reply 2 and Moore’s declaration. 20
The opinion stated that “with respect to inventorship, the Board will defer that 21
issue to the priority phase of the interference, as Judge Torczon previously 22
decided.” Decision on ITRI Motion to Strike, Paper 166, 9:13-14 (emphasis 23

7 PacBio also shifted its exclusion theory from that in its Motion 2. In Motion 2 it
asserted that the subject matter described in the ‘375 patent and the involved
claims were co-owned by Pacific Biosciences at the time the invention was made.
PacBio Motion 2, Paper 56, 15:1-10. In its Reply 2 and Moore Declaration its
exclusion theory depends on the obligation to assign the invention by virtue of the
previously signed employee agreements. Moore Declaration, Ex. 1027, 2:11-14. .

15

added). PacBio identifies the Transcript of the December 9, 2013, conference call 1
with Judge Torczon as the “previous decision.” PacBio Response to OC, Paper 2
178, 7:6-9. 3
The problem with this position is that the decision made by the APJ was in 4
the context of a motion to strike the reply. At that point, PacBio’s counsel 5
apparently had already made the litigation choice not to pursue a motion for 6
correction of inventorship, but rather to attempt to prove the ownership and 7
assignment elements of the 103(c)(1) exception to the cross-applicability in its 8
reply. PacBio conflates the two approaches. 9
In any event, Judge Torczon’s previous decision did not defer the 10
inventorship motion to priority. He simply did not authorize it, but advised PacBio 11
it could renew its request for authorization to file the motion in the event it became 12
apparent that it was necessary: 13
I'm not going to authorize it at this point. It's going to be 14
without prejudice to your requesting it if a reason arises why it 15
needs to come up during the interference. 16
Transcript of December 9, 2013 Conference Call, Paper 23, 21:1-4. See also, 17
Order Authorizing Motions, Paper 22, p. 3. Thus, it was up to PacBio to seek 18
authorization to file the motion “if a reason arises why it needs to come up during 19
the interference.” 20
D. 21
PacBio requests that it be allowed to file a motion to change inventorship. It 22
relies on Schulze v. Greene, 136 F.3d 786 (Fed. Cir. 1998) for support. Response 23
to OC, Paper 178, 11:5 – 12:8. Specifically, it relies on the following statement 24
from Schulze: 25
Appellants raised the issue of proper inventorship, and 26
Appellants had all of the facts necessary to present the issue. 27
Therefore, because Appellants’ patentability question of 28

16

inventorship was fairly raised, could have been and still can be 1
fully presented during the interference, it must be resolved 2
interpartes. Id. at 791 (with emphasis). 3
Response to OC, Paper 178, 11:14-17. According to PacBio, like Schulze, it has 4
been placed in a procedural trap—a procedural “gotcha.” It argues that it fairly 5
raised the issue of incorrect inventorship, had all the facts to resolve the issue, and 6
was neither informed that correction of inventorship would be required nor allowed 7
to establish common ownership, nor allowed to file a motion to correct 8
inventorship. Response to OC, Paper 178, 11:24 – 12:2. 9
We do not consider Schulze to provide support for PacBio’s position. In the 10
Schulze interference, Schulze was faced with a motion for judgment that its claims 11
were unpatentable under 35 U.S.C. § 102(f) for naming incorrect inventors. 12
Schulze filed a motion under then applicable 37 C.F.R. §§ 1.6348 (1994) and 13
1.636(c)9 (1994) to correct inventorship. The motion was dismissed, without 14
evaluating inventorship, because the motion did not comply with the formal 15
requirements of 37 C.F.R. § 1.48 (1994).10 Compliance with § 1.48 was an express 16

8 § 1.634 Motion to correct inventorship.
A party may file a motion to (a) amend its application involved in an interference
to correct inventorship as provided by § 1.48 or (b) correct inventorship of its
patent involved in an interference as provided in § 1.324. See § 1.637

9 § 1.636 Motions, time for filing.
* * * * *
(c) A motion under § 1.634 shall be diligently filed after an error is discovered in
the inventorship of an application or patent involved in an interference unless
otherwise ordered by an administrative patent judge.

10 § 1.48 Correction of inventorship in a patent application, other than a reissue
application, pursuant to 35 U.S.C. 116.
(a) Nonprovisional application after oath/declaration filed. If the inventive entity is
set forth in error in an executed § 1.63 oath or declaration in a nonprovisional

17

requisite of § 1.634. Schulze never refiled its dismissed motion. The Board’s final 1
decision held that Schulze’s claims were unpatentable under § 102(f) for improper 2
inventorship and, based on Schulze’s failure to refile its inventorship motion, 3
entered judgment against Schulze’s claims. On appeal, the Federal Circuit vacated 4
and remanded the unpatentability decision and ordered the Board to allow refiling 5
of the inventorship motion to perfect the informalities: 6
[B]ecause Appellants may not have understood that they had to 7
litigate inventorship inter partes or suffer an adverse judgment, 8
we will direct the Board to afford Appellants a last, clear 9
chance to perfect their motion to correct inventorship inter 10
partes. Although the Green motion for judgment by itself 11
would have put Appellants on sufficient notice, the silence by 12
the APJ and the Board in the face of Appellants' stated intention 13
to refile ex parte and the unclear statement of the APJ as to 14
timing negated the otherwise adequate notice of the Green 15
motion. 16
Schulze, 136 F.3d at 792. 17

application, and such error arose without any deceptive intention on the part of the
person named as an inventor in error or on the part of the person who through error
was not named as an inventor, the inventorship of the nonprovisional application
may be amended to name only the actual inventor or inventors. If the
nonprovisional application is involved in an interference, the amendment must
comply with the requirements of this section and must be accompanied by a
motion under § 1.634. Amendment of the inventorship requires:
(1) A request to correct the inventorship that sets forth the desired
inventorship change;
(2) A statement from each person being added as an inventor and from each
person being deleted as an inventor that the error in inventorship occurred without
deceptive intention on his or her part;
(3) An oath or declaration by the actual inventor or inventors as required by
§ 1.63 or as permitted by §§ 1.42, 1.43 or § 1.47;
(4) The processing fee set forth in § 1.17(i); and
(5) If an assignment has been executed by any of the original named
inventors, the written consent of the assignee (see § 3.73(b) of this chapter).

18

The situation here is unlike that in Schulze. Schulze’s motion to change 1
inventorship was dismissed and never evaluated by the Board on the merits. 2
PacBio, on the other hand, raised inventorship in its Reply 2 and the 3
accompanying Moore Declaration. On remand from the Federal Circuit, PacBio’s 4
Motion 2, Reply 2 and the Moore declaration were fully evaluated by the Board 5
with respect to § 103(c)(1) and inventorship. As noted by the Federal Circuit: 6
Because we affirm the obviousness determination as to claims 7
1–22 and 24–26 of ITRI's ′630 patent and remand the case for 8
further determinations as to claims 23, 27, and 28 of that patent, 9
the Board will have another opportunity to address the cross- 10
applicability issue. 11
Industrial Tech., ___ Fed. Appx. At ___; 2016 WL 363518 at *10. We did not 12
dismiss Reply 2 or the Moore declaration. We held that PacBio’s evidence to be 13
insufficient to prove that the ‘375 patent and the claimed invention were co-owned 14
or subject to assignment, at the time the invention claimed in PacBio’s involved 15
applications was made. The situation here simply presents a failure of proof, not a 16
situation involving a procedural dismissal of the motion without consideration on 17
the merits. 18
PacBio’s original request to file an inventorship motion was not authorized 19
because it failed to explain to the APJ why its inventorship needed to be addressed 20
in the interference. Transcript December 9, 2013 Conference Call, Paper 23, 20: 3 21
– 21:4. Nor did PacBio seek authorization to file a motion directed to 22
inventorship when it became apparent that a change of inventorship was necessary 23
to come within the exclusion of § 103(c)(1); instead, PacBio chose to attempt to 24
remedy the defect in its Motion 2 in its Reply 2. 25
The interference regulations are quite clear in stating the requirements for 26
motions. As we noted above, the movant has the burden of proof to establish that 27
it is entitled to the requested relief. 37 C.F.R. § 41.121(b). It must provide 28

19

sufficient evidence to justify that relief. 37 C.F.R. § 41.208(b). There must be a 1
complete statement of the reasons the evidence and the law justify the granting the 2
motion. 37 C.F.R. § 41.121(c)(iii). Section 103(c)(1) identifies what must be 3
proved—co-ownership or obligation to assign at the time the claimed invention 4
was made. PacBio’s Motion 2 and its Reply 2 (including Moore’s declaration) did 5
not establish that PacBio was entitled to exclude the ‘375 patent from the relevant 6
prior art under 35 U.S.C. § 103(c)(1). 7
Additionally, with respect to PacBio’s argument that it has been subject to a 8
“procedural gotcha,” we note that the reason PacBio was authorized to supplement 9
its evidence on co-ownership with its Reply 2 was to avoid the possibility of a 10
procedural trap due its failure to provide any evidence on co-ownership. As noted 11
by the APJ: 12
As far as the [co-ownership] issue goes, this is probably a 13
reasonably foreseeable issue and yet you probably should be 14
putting in evidence. It's not clear to me what the real prejudice 15
is other than what sounds a bit like a kind of procedural gotcha. 16
So I'm going to go ahead and authorize the declaration to show 17
the co-ownership. 18
Transcript of Conference Call of June 2, 2014, Paper 142, 16:9-16. 19
E. 20
As part of its response to the Order to Show Cause, PacBio proffers the 21
declarations of the individuals that Moore identified as the inventors. Ex. 1031 We 22
decline to enter and consider this evidence because it is untimely. Late filings may 23
be excused upon a showing of excusable neglect or that consideration of the 24
documents would be in the interests of justice. 37 C.F.R. § 41.4(b)(2). PacBio has 25
demonstrated neither excusable neglect nor that it is in the interests of justice to 26
enter and consider the documents. To allow the evidence at this point would 27
necessitate reopening this proceeding to matters that could have been raised and 28

20

fully addressed during the motions phase of this interference. Board proceedings 1
are to be conducted “to secure the just, speedy, and inexpensive resolution of every 2
proceeding before the Board.” 37 C.F.R. § 41.1(b). Neither the Board nor ITRI, 3
were responsible for PacBio’s failure to prove or timely raise inventorship 4
connection with its co-ownership position. When it became apparent to PacBio 5
that inventorship was central to its 103(c)(1) argument, PacBio did not seek 6
authorization to file a motion addressing inventorship as specifically suggested by 7
the APJ. See Transcript of December 9, 2013 Conference Call, Paper 23, 21:1-4; 8
Order Authorizing Motions, Paper 22, p. 3. We fail to be convinced that it is in the 9
interests of justice to reopen this proceedings to allow further consideration of 10
inventorship. 11
F. 12
PacBio argues there is no authority requiring that inventorship be formerly 13
corrected prior to asserting common inventorship. Response to OC, Paper 178, 14
7:24 – 8:26. We do not disagree with that statement. Our decision did not turn on 15
the fact that PacBio did not file a motion to change inventorship. Rather it was 16
based upon the failure of PacBio to prove co-ownership, or an obligation to assign, 17
at the time the invention was made. It was PacBio’s burden to prove that the 18
presumption of § 41.207(c) was not applicable. 37 C.F.R. § 41.121(b). As stated in 19
our Decision on Motions: 20
Moore’s testimony and the assignment documents are 21
insufficient to prove that “the [prior art] subject matter and the 22
claimed invention were, at the time the claimed invention was 23
made, owned by the same person or subject to an obligation of 24
assignment to the same person.” 25
Decision on Motions, Paper 176, p. 15:11-14. PacBio’s § 103(c)(1) position, as 26
presented in its Reply 2, relied upon inventorship different than stated in the 27

21

records of its involved applications. In particular, with respect to the asserted 1
inventorship, we stated: 2
PacBio has not provided sufficient evidence to establish that 3
Turner, Sorenson, Travers and Heiner, are the inventors of the 4
subject matter of the count. Moore only makes the conclusory 5
statement that “based on information and belief” they are the 6
inventors. He has not directed us to any evidence to support his 7
testimony (Cf. 37 C.F.R. 1.63(a)(4)) or provided an explanation 8
of his basis for making the determination that the four 9
individuals were the inventors of the subject matter of the 10
count. 11
Decision on Motions, Paper 176, 16:21-28. Having made inventorship an element 12
of its § 103(c)(1) case, it had the burden of proving its newly asserted inventorship 13
at that time. 14
PacBio was required at the time of its unpatentability motion to prove that it 15
was entitled to the requested relief—in this case such proof included that it was 16
entitled to the benefit of § 103(c)(1). 37 C.F.R. § 41.121(b). In order to meet that 17
burden, PacBio had to prove co-ownership, or an obligation to assign, at the time 18
its claimed invention was made. PacBio’s Motion 2 merely alleged, without any 19
proof, co-ownership at the time the invention was made and that § 103(c) excluded 20
the ‘375 patent as prior art. This attorney argument alone was insufficient to meet 21
PacBio’s burden to rebut the presumption of 37 C.F.R. § 41.207(c). Counsel's 22
argument cannot take the place of evidence lacking in the record, Estee Lauder Inc. 23
v. L'Oreal, S.A., 129 F.3d 588, 595, (Fed. Cir.1997). 24
When given the further opportunity to provide evidence with its reply to 25
supplement its motion and prove co-ownership, PacBio asserted, for the first time a 26
co-ownership based upon an inventorship different than that specified in its 27
involved applications. The unsubstantiated testimony that “based upon 28
information and belief” that Turner, Sorenson, Travers and Heiner were the 29

22

inventors of the involved claims is insufficient in light of the administrative record 1
of the ‘673 and ‘178 applications. Those applications include the declarations by 2
the eleven inventors named in those applications that they are the inventors of the 3
claimed subject matter. See Ex. 3001. 4
G. 5
PacBio complains that the Board failed to provide guidance as to the 6
evidence that would be sufficient to establish co-ownership and meet the 7
requirements of § 103(c)(1): 8
PacBio sought guidance as to what “additional evidence in the 9
form of a declaration or other that shows co-ownership between 10
the `375 patent and the involved application of the Pacific 11
Biosciences” would be needed and expressed its willingness to 12
provide such evidence. 13
Response to OC, Paper 178, 3:19-23. However, it is inappropriate for the Board to 14
provide guidance of the type requested. To provide guidance as to the specific 15
proofs that would be sufficient to satisfy a parties’ burden would be to unfairly 16
provide assistance to one side in this inter partes proceeding. The rules of the 17
Board including 37 C.F.R. §§ 41.207(c), 41.208(b), 41.121(b) - (d)), 41.151 and 18
41.152 and the statute (35 U.S.C. § 103(c)(1)) provide adequate guidance as to the 19
procedures and what must be substantively proved. 20
III. 21
The parties have failed to show cause why judgment should not be entered 22
against Claims 1-22 and 24-28 of ITRI Patent 8,846,630, Claim 1 of PacBio 23
Application 13/633,673 and Claims 1-4 of Application 13/930,178. 24
A judgment will issue in a separate paper. 25

23

cc (electronic delivery):
Attorney for ITRI:
David S. Forman
M. Paul Barker
Finnegan, Henderson, Farabow,
Garrett & Dunner, LLP
david.forman@finnegan.com
paul.barker@finnegan.com

Attorney for PacBio:
Michael S. Tuscan
Bonnie Weiss McLeod
Colley, LLP
mtuscan@cooley.com
bweissmcleod@cooley.com
zpatdocketing@cooley.com