The Federal Circuit recently affirmed the Board’s IPR decision that IBS failed to satisfy its burden of demonstrating obviousness of the challenged claims of Illumina’s U.S. Patent No. 7,566,537 (“the ‘537 patent), and determined that the Board did not abuse its discretion in refusing to consider IBS’s reply brief.  Intelligent Bio-Systems, Inc. v. Illumina Cambridge Ltd., Case No. 2015-1693 (Fed. Cir. May 9, 2016). Illumina contended that its challenged claims, directed to a method of labeling nucleotides to determine their identity in a sequencing by synthesis (SBS) method, were nonobvious based on its use of a particular azidomethyl group as a 3′ OH blocking (or protecting) group.

In its Petition, IBS challenged the ‘537 patent claims as obvious over prior art (Tsien and Zavgorodny), arguing that an ordinary artisan, “to improve the [SBS] method taught in Tsien, would have been motivated to use other protecting groups that meet the criteria of Tsien, such as the azidomethyl group taught by Zavgorodny,” and would have expected to succeed.  IBS expressly relied on the fact that “Zavgorodny teaches the desired property [in Tsien] that the azidomethyl group ‘can be removed under very specific and mild conditions.’”

Illumina argued that an ordinary artisan would not have expected the azidomethyl group to meet Tsien’s criteria of quantitative and rapid removal from a nucleic acid molecule, because Zavgorodny’s azidomethyl protecting group would be removed at a much lower efficiency than required by Tsien and because the pyridine used in removing the protecting group was known in the art to denature DNA.  Thus, “the conditions described by Zavgorodny for removing its azidomethyl group would not have been considered sufficiently mild for use in Tsien’s sequencing methods.”

In its Reply, IBS argued for the first time, “that an ordinary artisan would have considered it obvious to use deprotecting conditions other than those described in Zavgorodny,” relying on new prior art references and expert testimony not included with its Petition, and asserting that the deprotecting conditions used in Zavgorodny would have been obvious to modify.

The Board found that IBS’s Petition did not provide a specific or credible explanation why an ordinary artisan would have expected the azidomethyl protecting group, as described in Zavgorodny, to meet Tsien’s quantitative deblocking requirement.  In finding that IBS had not met its burden, the Board declined to consider IBS’s Reply, because reply evidence “may only respond to arguments raised in the corresponding opposition or patent owner response.”  The Board said that IBS ran afoul of 37 C.F.R. § 42.23(b) by presenting a new argument and evidence for the first time in its reply brief.

In affirming the Board’s decision, the court said that, “[o]nce the Board identifies new issues presented for the first time in reply, neither this court nor the Board must parse the reply brief to determine which, if any, parts of that brief are responsive and which are improper.”  As a result, the court concluded that neither it nor the Board needed to consider any portion of the petitioner’s reply—even those portions that may have been proper, explaining that the Board’s practice is appropriate for IPR proceedings:

Unlike district court litigation—where parties have greater freedom to revise and develop their arguments over time and in response to newly discovered material—the expedited nature of IPRs bring with it an obligation for petitioners to make their case in their petition to institute.

This decision reaffirms that the petitioner must identify in the petition, “with particularity” all “evidence that supports the grounds for the challenge to each claim.” 35 U.S.C.  § 312(a)(3).  Along with Ariosa v. Verinata, this case serves as a reminder that a petition must include all necessary evidence and arguments to satisfy its burden of proof.  A petitioner will not get a second shot in a Reply.