Granting in Part Institution Finding Time Bar on Challenge to Parent Application Does Not Bar Challenge to Child Application IPR2015-01090


Takeaway: A time bar to challenging a parent application does not prevent a petitioner from filing a challenge against a child application.

In its Decision, the Board granted institution of inter partes review (“IPR”) of claims 1, 2, 4-7, 9-12, and 14 of the ’529 patent, but denied institution of claims 3, 8, and 13 of the ’529 patent. The ’529 patent relates to managing mobile applications on mobile devices by associating a user profile with each user using a mobile device. Petitioner alleged that (1) claims 1-14 are anticipated by Mehta; (2) claims 4, 9, and 14 are obvious over Mehta and Herschberg; (3) claims 1-3, 5-8, and 10-13 are anticipated by Clare; and (4) claims 1-3, 5-8, and 10-13 are obvious over Clare and Mehta. Continue reading

Denying Additional Discovery where Party Had Sought Potentianal Indemnification from Third Parties IPR2015-01322


Takeaway: A party’s statements in a related litigation that it was seeking potential indemnification from third parties, which includes the petitioner, is not sufficient to establish beyond speculation that something useful will be uncovered to support a motion for additional discovery.

In its Decision, the Board denied Patent Owner’s Motion for Additional Discovery seeking production of documents and “authorization to take a deposition of an IBM designee.” In particular, Patent Owner sought discovery to determine whether Petitioner was in privity with J.P. Morgan Chase & Co. (“JPMC”) with respect to Patent Owner’s patent infringement litigation against JPMC and two subsidiaries (“New York litigation”). Because JPMC had been served with a complaint more than one year before the Petition was filed, Patent Owner argued that the Petition was time-barred by virtue of Petitioner’s privity with JPMC.

Whether a party is a privy “depends on whether the relationship between a party and its alleged privy is ‘sufficiently close such that both should be bound by the trial outcome and related estoppels.’” The Board considers “whether the non-party exercised or could have exercised control over a party’s participation in a proceeding.”

The party seeking additional discovery “must show that such additional discovery is in the interests of justice.” According to the first Garmin factor, the party “should already be in possession of evidence tending to show beyond speculation that in fact something useful will be uncovered.”

Patent Owner argued that publicly available information established a “high probability” that evidence that Petitioner had “the contractual right to control JPMC’s defense in the New York litigation,” citing the “IBM Client Relationship Agreement” and “IBM Customer Agreement” available on Petitioner’s website. According to Patent Owner, the documents established that Petitioner has the right “if not the duty” to control the defense of infringement claims made against its customers, triggered when the customer notifies Petitioner in writing. Patent Owner also cited evidence of statements made by JPMC that it was coordinating with Petitioner to take over the defense of the New York litigation.

The Board found that Patent Owner did not provide persuasive evidence of an agreement between JPMC and Petitioner. Even if such an agreement existed, the Board was not persuaded that it contained an indemnification clause similar to that found on Petitioner’s website, and even if it did, the Board was not persuaded that Petitioner had actual control or the opportunity to control the New York litigation in light of the additional conditions that must be met before Petitioner could assume control. Patent Owner did not offer evidence that any of the additional conditions had been met with respect to JPMC and the New York litigation. With respect to the statements made by JPMC in the New York litigation, the Board found that the evidence only established that JPMC was coordinating with “potential third parties––about two dozen companies, including [Petitioner].” Thus, the Board found that Patent Owner did not set forth “any more than a possibility and allegation that something useful will be found.”

With respect to the discovery requests, the Board found some of the document requests to be overly burdensome that would require significant expenditures by Petitioner.

Therefore, the Board denied Patent Owner’s Motion for Additional Discovery.

International Business Machines Corporation v. Intellectual Ventures II LLC, IPR2015-01322 and IPR2015-001323
Paper 11: Decision Denying Patent Owner’s Motion for Additional Discovery
Dated: September 24, 2015
Patent: 6,314,409 B2
Before: Kristen L. Droesch, Barbara A. Parvis, and Matthew R. Clements
Written by: Droesch

Federal Circuit Appeal in IPR2013-00080, 00081: Achates Reference Publishing v. Apple

PTAB Determination regarding Time-Bar under 315(b) is Not Appealable to the Federal Circuit


Takeaway: The Board’s determination regarding the time-bar under Section 315(b) is not analogous to the qualification of a patent for covered business method review and is not appealable to the Federal Circuit.

In its Opinion, the United States Court of Appeals for the Federal Circuit dismissed the appeals of Petitioner, Achates, appealing the Board’s Final Written Decisions in IPR2013-00080 and IPR2013-00081 finding claims 1-4 of the ’889 patent and claims 1-12 and 17-19 of the ’403 patent unpatentable. Achates appealed the Board’s decisions on the basis that the petitions were time-barred under 35 U.S.C. § 315(b), and the Board therefore acted outside of its statutory authority. Achates also appealed the Board’s denial of its motion for discovery.

Achates argued at the Board that Apple’s Petition is time-barred because Apple’s co-defendants in a patent infringement suit brought by Achates were actually real parties in interest with respect to the Petition or were in privity with Apple. The co-defendants had been served with the complaint for infringement more than one year before the Petition was filed and were therefore time-barred, but Apple was served with its complaint less than one year before the Petition’s filing. Achates relied upon a blank indemnification agreement between Apple and co-defendant QuickOffice as allegedly establishing privity or real party in interest, and moved for additional discovery into real party in interest on the same basis.

The Board found that the co-defendants were not real parties in interest or in privity with Apple and denied Achates’s motion for discovery. The Petitions were instituted, and the challenged claims subsequently found unpatentable. On appeal, Achates only challenged the Board’s denial of its motion for discovery and its conclusion that the Petitions were not time-barred.

The Court first reviewed the relevant statutory provisions regarding appealing decisions of the Board. According to 35 U.S.C. §§ 314(d) and 324(e), respectively, “[t]he determination by the Director whether to institute [IPR or CBMR] under th[ese] section[s] shall be final and nonappealable.” In contrast, pursuant to 35 U.S.C. §§ 319 (IPR) and 329 (CBMR), “part[ies] dissatisfied with the final written decision of the Patent Trial and Appeal Board under section[s] [318(a) or 328(a)] may appeal the decision pursuant to sections 141 through 144.” Moreover, the Federal Circuit noted that 35 U.S.C. § 141(c) states

A party to an inter partes review or a post-grant review who is dissatisfied with the final written decision of the Patent Trial and Appeal Board under section 318(a) or 328(a) (as the case may be) may appeal the Board’s decision only to the United States Court of Appeals for the Federal Circuit.

The Court also discussed other Federal Circuit opinions holding that the Court lacked jurisdiction to hear appeals of institution decisions. In particular, the Court cited In re Cuozzo Speed Techs., LLC, 793 F.3d 1268 (Fed. Cir. 2015), in which the Court held that the “reviewability prohibition” of Section 314(d) is not limited to interlocutory appeals and applies where the appeal of the institution decision is taken after the Board’s final written decision.

The Court also discussed Versata Dev. Grp., Inc. v. SAP America, Inc. (“Versata II”), 793 F.3d 1306 (Fed. Cir. 2015). In Versata II, the patent owner Versata appealed the Board’s determination that its patent qualified as a covered business method patent for CBM review after the Board’s final written decision. The Court held that while institution decisions are not appealable, the determination of whether a patent qualifies as a covered business method patent “was necessarily implicated in the final merits determination and was appropriate for review because of the fundamental limitation of the Board’s ‘ultimate invalidation authority’ in a CBMR to those patents that meet the CBM definition.”

Achates argued that, in the present case, a time-barred petition “goes to the Board’s ultimate authority to invalidate the patents, and therefore, under Versata II, is reviewable under § 319.” The Court disagreed, finding that Versata II was limited to its unique circumstances. In particular, the Court found that Section 315(b) “does not impact the Board’s authority to invalidate a patent claim—it only bars particular petitioners from challenging the claim.” In addition, the Court noted that the time limitation does not apply to joinder under subsection (c). Therefore, “the timeliness issue here could have been avoided if Apple’s petition had been filed a year earlier or if a petition identical to Apple’s were filed by another party,” in contrast to the situation in Versata II, where “no proper pleading [] could be filed to bring it within the [Board’s] § 18 authority.”

In addition, the Court distinguished the time-bar from Versata II because qualification as a covered business method patent was “the ‘defining characteristic’ of the Board’s ‘authority to invalidate’ a patent in the specialized CBMR process.” However, the time-bar is not such a defining characteristic, but is rather merely a rule for orderly progress of litigation.

Achates also argued that the Board’s reaffirmation of the time-bar determination in its final written decision made the determination appealable. The Court disagreed, finding that the overlap is not determinative (citing Versata II) and that the reconsideration of the time-bar can still be characterized as part of the institution decision.

Achates finally argued as a matter of statutory interpretation that the prohibition in Section 314(d) applied only to that section. However, the Board disagreed with Achates’s interpretation and found it to be contradicted by precedent. In particular, the “words ‘under this section’ in § 314 modify the word ‘institute’ and proscribe review of the institution determination for whatever reason.”

Thus, the Court held that Section 314(d) prohibits review of the Board’s determination regarding the time-bar of Section 315(b), even where the Board reconsiders its determination as part of the final written decision. The Court further held that “the Board’s institution decision does not violate a clear statutory mandate,” and therefore, the exception for ultra vires agency action does not apply.

Achates Reference Publishing, Inc. v. Apple Inc., No. 2014-1767, No. 2014-1788
Dated: September 30, 2015
Appeal From:
  IPR2013-00080; IPR2013-00081
Before: Judges Prost, Lourie, and Linn
Written by: Linn

Denying Motions to Vacate because Un-named Members of Corporate Group were Separate Entities IPR2015-00808, 814, 815, 818, 819, 823, 824


Takeaway: Absent a “compelling reason to disregard entity separateness,” members of a corporate group should be treated as separate entities.

In its Order, the Board denied Patent Owner’s Motion to Vacate because of an alleged failure of Petitioner to name two corporate entities as real parties in interest (RPI). Patent Owner filed similar Motions to Vacate in seven inter partes review proceedings, alleging that because at least two entities were not identified as an RPI, the Petitions should not be entitled to a filing date, 35 U.S.C. § 312(a)(2), and were therefore time-barred under 35 U.S.C. § 315(b). Continue reading

Infringement Complaint Provides Notice of Infringement for All Patent Claims IPR2015-00530


Takeaway: When a complaint alleging infringement of a patent alleges infringement of “one or more claims” or “at least claim X” of the patent, the defendant is on notice concerning potential infringement of any claims of the patent, and later identification of specific claims via infringement contentions does not extend the time period in which a petition for IPR may be filed. In addition, if a new petition is filed and joinder is sought with an earlier petition, the petitioner should file its petition and motion promptly and also should explain why the claims were not addressed in the earlier petition. 

In its Decision, the Board denied Petitioner’s Motion for Joinder and denied its Petition to institute inter partes review of claims 1, 23, 24, 26, 31, 47, and 51 of U.S. Patent No. 6,404,953. The ’953 patent generally relates to “an apparatus for optical noise reduction in optical assemblies by controlling or limiting undesirable photon entrance, reflection, departure, or appearance in or from the assembly.”

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One Year Bar Triggered By Complaint Asserting the Reissue Patent, Not the Surrendered Patent IPR2014-00358


Takeaway: Section 315(b) does not bar a petition for review of a reissue patent when the petition is filed within one year after the petitioner is served with a complaint alleging infringement of the reissue patent but more than one year after the petitioner is served with a complaint alleging infringement of the surrendered original patent if the claims of the reissue patent are not “substantially identical” to the claims of the original patent.

In its Final Written Decision, the Board concluded that Petitioner had not shown by a preponderance of the evidence that claims 101-104 of U.S. Patent RE43,707 are unpatentable. The ’707 patent relates to “a system and method for noise reduction in medical images being viewed on display systems.”

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Indemnitor Merely Sending Advice Does Not Result in Privity IPR2015-00635


Takeaway: One factor to determine if a non-party is in privity with a litigant is whether the non-party exercised or could have exercised control over a party’s participation in a proceeding.

In its Decision, the Board granted institution of inter partes review (“IPR”) of claims 1, 3, and 4 of the ’883 patent. The ’883 patent relates to facilitating two-way multi-media communication based on a shared transmission media such as a coaxial cable-TV network, and more specifically, to signaling channel management and protocol. Petitioner alleged that (1) claims 1 and 4 of the ’883 patent are obvious over MPT 1343, MPT 1347, and MPT 1327, and (2) claim 3 is obvious over MPT 1343, MPT 1347, MPT 1327, Zdunek, and Dufresne. No claim terms were expressly construed. Continue reading

Denying Request for Rehearing where Arguments Deemed Not Commensurate with Claim Scope CBM2015-00010


Takeaway: Arguments related to either patentability or whether claims qualify for covered business method patent review are likely not persuasive if they are not commensurate in scope with the claims of the challenged patent.

In its Decision, the Board denied both parties’ requests for rehearing of the Board’s Decision to institute trial with respect to some of the asserted grounds in the Petition. The Board reviews decisions for an abuse of discretion, which “may be determined if a decision is based on an erroneous interpretation of law, if a factual finding is not supported by substantial evidence, or if the decision represents an unreasonable judgment in weighing relevant factors.” The party requesting rehearing has the burden to show the decision should be modified and “must identify specifically all matters the party believes the Board misapprehended or overlooked.” Continue reading

Denying Institution IPR2015-00762


Takeaway: Whether a petitioner will be successful on a motion for joinder when it is already a party to the proceeding to which it is requesting to join is dependent upon the panel because different panels have come to different conclusions.

In its Decision, the Board denied Petitioner’s Motion for Joinder, and did not institute inter partes review of any of the challenged claims (1-3, 8, 9, 12, 16, and 19) of the ’349 Patent. The ’349 Patent relates to heating, ventilating, and/or air conditioning (“HVAC”) systems. Continue reading

District Court Dismissal Without Prejudice Serves As Bar To Petition CBM2015-00057; CBM2015-00058


Takeaway: In determining whether a dismissal without prejudice of the first case has the effect as if the first case never existed in the context of the bar under 35 U.S.C. § 325(a)(1), a dispositive factor is whether the first action is immediately continued into the second action, including the legal positions taken by the parties.

In its Decision, the Board denied covered business method patent review of all of the challenged claims of the ’304 Patent and the ’132 Patent. The Board found that Petitioner is barred by 35 U.S.C. § 325(a)(1).

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