AIA Post-Issuance Proceedings – Live Testimony Finds Its Way Into Oral Argument for Inter Partes Review

In order to achieve the statutory requirement of rendering a final determination no later than one year following the institution of an Inter Partes Review (IPR), the Trial Practice Guidelines set forth by the U.S. Patent & Trademark Office “lay out a framework for conducting the proceedings aimed at streamlining and converging the issues for proceeding.” For example, the guidelines for oral arguments prohibit the submission of new evidence and arguments by the parties, and suggest that live testimony is generally unnecessary. The parties may however move for live testimony in “appropriate situations.”

In view of these guidelines, patent owner Escort, Inc. filed a Motion for Live Testimony on April 20, 2014 in K-40 Electronics v. Escort (IPR2013-00203), seeking leave for the named inventor on the patent at issue (Steven Orr) to provide live testimony during oral argument. Escort’s motion followed its earlier Request for Oral Argument and a Request for Oral Argument filed by petitioner K-40 Electronics, LLC.

In its Motion for Live Testimony, Escort argued that, because K-40 had raised the issue of “the alleged ‘questionable credibility of [Mr. Orr’s earlier testimony],’” Mr. Orr’s live testimony was necessary for the Patent Trial and Appeal Board to observe his demeanor and evaluate his credibility, as well as being consistent with principles of due process. In an Opposition to Patent Owner’s Motion for Live Testimony, K-40 argued that Mr. Orr’s earlier video testimony provided more than an adequate opportunity to observe Mr. Orr’s demeanor, and that allowing Mr. Orr’s live testimony during oral argument would provide Escort with “a ‘second bit at the apple’ [that would be] repugnant to the interests of justice.”

In Orders issued on May 15, 2014 and May 21, 2014, the Board granted the parties’ initial oral argument requests, and allowed Mr. Orr’s live testimony in support of a 30-minute cross-examination by K-40 and a 30-minute redirect examination by Escort. The Board explained its decision by noting the following:

In addition to being named as sole inventor on the patent in this proceeding and a related proceeding involving the same parties and technology …, Mr. Orr is Petitioner’s principal fact witness. Through his declaration testimony in both cases, Patent Owner attempts to antedate the only two references … relied on by Petitioner in its challenge to patentability. Mr. Orr’s testimony is, therefore, key, and may well be case-dispositive.
…
The Board has determined that only cross-examination and redirect will be permitted, thus limiting the scope of examination. No changes will be possible to Mr. Orr’s direct testimony, for that is fixed by his previously submitted declaration. And should Petitioner suspect that Mr. Orr is changing his testimony, he may be impeached with his prior testimony

On May 23, 2014, K-40 filed a Request for Rehearing, contending that the Board misapprehended or overlooked the adequacy of the earlier video evidence of Mr. Orr’s demeanor and clarifying that K-40 had no further questions for Mr. Orr that would lead it to seek his live cross-examination testimony during the oral argument. In an Order on the Rehearing Request issued on May 30, 2014, the Board answered K-40’s contentions by stating that it had “determined that notwithstanding the existence of the video record, there was good cause to grant the Motion.” The Board further made it clear that its reasoning for allowing Mr. Orr’s live testimony was to “permit the Board to observe his demeanor in a live setting,” and that it would not require K-40 to cross-examine him:

Because Petitioner’s counsel have now informed the Board that they have no further questions for Mr. Orr, Patent Owner will be given the first opportunity to examine Mr. Orr. Petitioner may then, if it desires, cross-examine Mr. Orr at the hearing. In lieu of or in addition to cross-examining Mr. Orr at the hearing, Petitioner may rely also on [Mr. Orr’s video and] deposition testimony.

While the Board also pointed out in its Order of May 21 that it “does not envision that live testimony will be necessary at many oral arguments,” it will be interesting to see whether the use of live testimony now becomes more prevalent in oral arguments lodged in IPR proceedings. We will continue to monitor and report on further developments in this area.