By Adam Cook and Matt Johnson –
In a 2-1 decision, the Patent Trial and Appeal Board (“PTAB”) denied a patent owner’s motion to file two new declarations in connection with its sur-reply, holding that the patent owner failed to prove the extraordinary circumstances necessary for such a filing. See Omega Liner Company, Inc. v. Buergofol GmbH, No. IPR2023-01372, Paper 44 (P.T.A.B. Nov. 18, 2024).
On September 12, 2023, Omega Liner Company, Inc. (“Omega”) filed a petition for inter partes review of U.S. Patent No. 9,657,882 (“’882 Patent”) owned by Buergofol GmbH (“Buergofol”). See id., Paper 2. The ’882 Patent discloses a coated insertion tube for trenchless sewage pipe renovation. See U.S. Patent No. 9,657,882. The PTAB granted institution, Buergofol responded, and Omega replied. See Omega Liner Company, No. IPR2023-01372, Papers 8, 13, 24. Buergofol moved to file two new declarations with its sur-reply, which Omega opposed. See id., Papers 35, 41. The declarations in question were of two named inventors of the ’882 Patent. See id., Exhibits 2028, 2029.
In its motion, Buergofol argued that the declarations should be admitted so that the inventors could “defend themselves against Petitioner’s unfounded allegations” of false statements in prior declarations. Id., Paper 35. Buergofol urged that “[t]he only way to raise facts to the Board’s attention is by submission of declaration testimony.” Id. In its opposition, Omega asserted that Buergofol had already addressed the allegations of false statements in its prior filings and that Buergofol could further address them in its forthcoming sur-reply. See id., Paper 41. Omega also contended that the new declarations failed to focus solely on Omega’s reply arguments, and they instead shifted Buergofol’s positions at a time too close to the scheduled oral hearing. See id.
The PTAB held that Buergofol failed to prove that its declarations were admissible because of extraordinary circumstances. See id., Paper 44. Rule 42.23(b) states that “[a] sur-reply may only respond to arguments raised in the corresponding reply and may not be accompanied by new evidence other than deposition transcripts of the cross-examination of any reply witness.” 37 C.F.R. § 42.23(b). This rule appears bright-line, but in its order, the PTAB hinted at the possibility of an “extraordinary circumstances” exception. See id., Paper 44. The “extraordinary circumstances” language originated from Omega’s opposition to the motion and is seemingly not based on a prior ruling. See id., Paper 41. The PTAB found that Buergofol failed to explain (1) why the existing record was insufficient when the existing record already contained the disputed facts and (2) why the new declarations were the only way to raise facts to the PTAB’s attention when Buergofol was free to highlight facts in its sur-reply. See id., Paper 44.
In a dissent, Judge McGraw found that Omega’s allegations of false statements against the inventors should permit the inventors to respond with new declarations. See id.
The PTAB’s decision in this case affirmed the efficacy of rule 42.23(b)’s limits on new evidence proposed with sur-replies. However, the PTAB hinted that the rule was not unsurpassable because an apparent extraordinary circumstances exception may exist. Although this ruling provided an example of a lack of extraordinary circumstances, the PTAB did not expand upon when extraordinary circumstances may arise. Future cases may flesh out this emerging exception.
Matthew Johnson
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