Razor Scooter Trips Over Reissue Statute at the ITC
The U.S. International Trade Commission (“ITC”) recently terminated CERTAIN MOTORIZED SELF-BALANCING VEHICLES, Investigation No. 337-TA-1000, brought by Razor USA LLC against alleged infringers of a patent related to electric hoverboards, denying Razor any relief. In doing so, the ITC confirmed that an original patent is surrendered when a Reissue Patent issues, even if a pending Continuation Application from the Reissue Application includes the claims of the original patent.
The ITC instituted Investigation No. 337-TA-1000 in May 2016. On the same day the ITC instituted the investigation, the Complainant, Razor USA LLC, sought reissue of the asserted patent, U.S. Patent No. 8,738,278 (“the ’278 patent”), but subsequently requested that the PTO suspend examination of the reissue application during the investigation, which it did. The Investigation proceeded to a hearing and the ITC found no violation of section 337. The ITC found that none of the then-participating respondents’ accused products infringed the asserted claims and that the technical prong of the domestic industry requirement was not satisfied. Razor then appealed that decision to the Court of Appeals for the Federal Circuit.
While the decision was on appeal, Razor asked the PTO to resume the reissue proceeding. In July 2018, before the Federal Circuit issued a decision on the appeal, the PTO issued a Notice of Allowance for U.S. Patent No. RE46,964 (“the RE’964 patent”), in which all original claims were amended or cancelled. The ITC then moved to dismiss the appeal as moot under 35 U.S.C. § 252, arguing that the original claims were surrendered once the reissue patent issued. The ITC also argued that, because the reissue claims are not “substantially identical” to the original claims, any existing causes of action are extinguished by operation of the statute.
In an attempt to avoid an argument that it surrendered the original patent, Razor filed two continuation applications of the reissue application, which contained the original claims from the ‘278 patent, prior to the issuance of the RE’964 patent. Razor argued in opposition to the ITC’s Motion that the existence of these pending continuation applications meant that the original claims had not been surrendered, thus avoiding mootness. Without considering the parties’ arguments, the Federal Circuit remanded the case to the ITC to determine “whether post-investigation events have rendered the case moot or whether the case may continue either on the original patent claims or reissued claims and to conduct any additional proceedings as necessary.”
After considering briefing from the parties, the ITC terminated the investigation as moot because no enforceable claims were left in the investigation. The ITC held that it cannot continue under the original claims, which have been surrendered, or the reissue claims, which are not substantially identical to the original claims. Moreover, Razor could not amend the complaint to include the reissue claims because those claims are only effective as of their issue date, which was after conclusion of the underlying investigation. In rendering its decision, the ITC rejected Razor’s argument – that the original claims of the ‘278 patent were not surrendered (and thus still enforceable) because there remained pending a continuation reissue application – as being inconsistent with the reissue statute.
Takeaway: Patent owners planning to use a reissue application to correct a patent asserted in litigation need to understand the PTO procedures and the legal consequences of a reissue application. The timing of both the filing of the application and the issuance of the reissue patent can have a significant impact on a patent owner’s legal rights. For more information on reissue and reexamination procedures at the PTO, see the USPTO’s April 2019 Notice Regarding Options for Amendments here.