The PTAB recently issued its first precedential ruling under the America Invents Act in a Covered Business Method Review proceeding. In its ruling, the PTAB decided that a CBM review cannot proceed if a petitioner files a civil suit to challenge a patent’s validity before filing a petition for Covered Business Method Review.

The PTAB issues decisions in three categories: routine, informative, and precedential. Routine decisions may be cited as persuasive authority. Informative decisions are not binding on the PTAB, but they commonly provide significant insight for future litigants. Precedential decisions bind all PTAB judges unless the decision is modified by the Federal Circuit, inconsistent with a decision of the Supreme Court or the Federal Circuit, overruled by a subsequent expanded panel, or overturned by statute.

In its first precedential decision, which was entered in SecureBuy, LLC v. CardinalCommerce Corporation, CBM2014-00035, the PTAB denied the institution of a Covered Business Method Patent Review. Administrative Patent Judge George Hoskins, writing for the panel, concluded CBM Review proceedings must employ the statutory standards and procedures of post-grant review proceedings. Post-grant reviews are barred where the petitioner or real party in interest files a civil action challenging the validity of a claim of the patent prior to the date on which a petition for review is filed.

Two weeks prior to filing its petition for CBM Review, the petitioner filed two separate civil actions seeking a declaratory judgment that the claims of the patent-in-suit were invalid under Sections 101, 102, 103, and 112

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