Motion For Sanctions Granted-in-part for Violation of Unentered Protective Order IPR2015-01750


Takeaway: The Board will not excuse conduct constituting breach of a protective order simply because the protective order had not yet been entered, particularly when the parties had agreed to operate with the understanding that it was in place.

In its Order, the Board granted-in-part Petitioner’s motion for sanctions against Patent Owner.  The Board noted that Petitioner has the burden to persuade the Board that sanctions are warranted.  In general, the Board reviews: (i) whether a party has performed conduct that warrants sanctions; (ii) whether the moving party has suffered harm from that conduct; and (iii) whether the sanctions requested are proportionate to the harm suffered by the moving party. Continue reading

Denying Motion for Sanctions IPR2015-01092


Takeaway: Evidence that a petition was filed for purely profit motivation and that that the petitioner does not have a competitive interest in the challenged patents is not enough to meet the burden required to grant a motion for sanctions to dismiss the petitions.

In its Decision, the Board denied Patent Owner’s Motion for Sanctions. The Motion alleged that the Petitions represent an ongoing abuse of the inter partes review process that are driven entirely by a “profit motive” unrelated to the purpose of the AIA or a competitive interest in the validity of the challenged patents. Patent Owner requested dismissal of the Petitions on the basis that the reasons for seeking review are illegitimate.  Continue reading

Decision Authorizing Motion for Sanctions Based on Ex Parte Communication CBM2014-00159


Takeaway: Any ex parte communication between Patent Owner and Petitioner’s expert outside the presence of counsel is wholly inappropriate.

In its Decision, the Board authorized Petitioner to file a motion for sanctions against Patent Owner. Also, the Board prohibited Patent Owner from contacting Petitioner’s expert, Dr. Sadeh, without prior Board authorization.

Continue reading

Motion for Leave to File Motion for Sanctions IPR2015-01092, 01096, 01102, 01103


Takeaway:  Petitioner’s alleged threat to file IPRs against Patent Owner, unless Patent Owner pays Petitioner, is sufficient to grant authorization for Patent Owner to file a motion for sanctions against Petitioner.

Based on specific representations made during a telephone conference, the Board authorized Patent Owner to file a motion for sanctions (hereinafter, “Motion”) against Petitioner that includes dismissal of the petitions (IPR2015-01092, IPR2015-1096, IPR2015-01102, IPR2015-01103). Continue reading

Order Granting Sanctions IPR2014-00351, IPR2014-00352


Takeaway: The Board may impose sanctions if a party fails to comply with the rules, an order from the panel, or causes unnecessary delays or costs.

In its Order in two related proceedings, the Board sua sponte sanctioned Patent Owner by ordering that (1) all of Patent Owner’s motions to exclude be expunged and (2) Patent Owner may not file a motion to exclude in either proceeding regarding any evidence already of record in either proceeding. Continue reading

Order Regarding Sanctions IPR2014-00739


Takeaway: The Board may impose sanctions against a party for misconduct, including for failure to comply with an order, abuse of the process, or any other improper use of the proceeding, such as harassment.

In its Order, the Board expunged Paper 12. Also, the Board ordered the inventor (Dr. Louis Sanfilippo) to refrain from contacting Petitioner or anyone associated with Petitioner in connection with this proceeding; that any communication from Patent Owner to Petitioner or its representatives in this proceeding must be signed by Patent Owner’s counsel of record; that Dr. Sanfilippo cannot sign any paper to be filed with the Board in this proceeding (instead, all papers must be signed by Patent Owner’s counsel of record); and that Petitioner is authorized to file a motion for sanctions against Patent Owner. Continue reading

Denying Authorization to File a Motion for Sanctions IPR2014-00674


Takeaway: Authorization for the filing of a motion for sanctions will not be granted in the absence of a showing of any misconduct under 37 C.F.R. § 42.12(a).

In its Order, the Board denied Patent Owner’s request for authorization to file a motion for sanctions under 37 C.F.R. § 42.12(a). Sanctions were warranted, according to Patent Owner, because it was the business model of Petitioner to circumvent the time bar set forth in 35 U.S.C. § 315(b), to avoid the efficiencies created by estoppel, and to harass Patent Owner. Continue reading

Denying Motion for Leave to File Motion for Sanctions Regarding Deposition Conduct CBM2014-00008


Takeaway: Deposition transcripts must be filed as exhibits, not papers.

In its Order, the Board indicated that the parties were not authorized to file any motions for sanctions at the present time. Also, the Board ordered that certain papers be expunged from the record and refiled by the Board as exhibits.

Patent Owner had requested a conference call seeking authorization to file a motion for sanctions under 37 C.F.R. § 42.12. Patent Owner’s alleged misconduct by Petitioner during the deposition of Patent Owner’s declarant, Mr. John Nerenberg. It was Patent Owner’s position that “Petitioner’s cross-examination of Mr. Nerenberg went beyond the scope of his direct testimony in violation of 37 C.F.R. § 42.53(d)(5)(ii).” In particular, “Patent Owner argued that Petitioner’s

questions were directed to the issue of enablement under 35 U.S.C. § 112 and designed to elicit testimony that could be used to support a second petition for covered business method patent review, which Petitioner had informed the district court in the related infringement case between the parties that it would be filing soon.” Patent Owner’s proposed motion for sanctions sought to strike certain pages of Mr. Nerenberg’s deposition transcript.

The Board was not persuaded that a motion for sanctions was warranted, at least because: Petitioner had agreed that it would not use the referenced portions of the deposition transcript in a second covered business method patent petition; Patent Owner had only objected to many, but not all, of Petitioner’s questions; and Patent Owner had not sufficiently explained why the particular improper questions would warrant striking pages of the deposition transcript.

On a related point, Petitioner argued that if its actions at Mr. Nerenberg’s deposition constituted misconduct, then Patent Owner’s asking Mr. Jeff Parmet (Petitioner’s declarant) questions about who was paying his fees, and how much he was being paid, at Mr. Parmet’s deposition was equally improper. Nonetheless, the Board denied Petitioner’s request to file a motion for sanctions as well, because, for example, Petitioner had not objected to Patent Owner’s questions during the deposition.

The Board noted that Petitioner had filed the deposition transcripts of Mr. Parmet and Mr. Nerenberg as papers, but that “[d]eposition transcripts must be filed as exhibits, not papers.” See 37 C.F.R. § 42.53(f)(7). Accordingly, the Board indicated that it would expunge and refiled the exhibits in question.

The Board also noted that Patent Owner’s email to the Board requesting a conference call, and Petitioner’s email in response, were improper because they each “contained lengthy arguments explaining the party’s position, citations to the record, and accusations against the other party.” To the contrary, each “email requesting a conference call should copy the other party, indicate generally the relief being requested or the subject matter of the conference call, state whether the opposing party opposes the request, and include multiple times when all parties are available.” The Board went on to note that such emails “may not contain substantive argument and, unless otherwise authorized, may not include attachments.”

Westlake Services, LLC d/b/a Westlake Financial Services v. Credit Acceptance Corp., CBM2014-00008
Paper 48: Order on Conduct of the Proceeding
Dated: August 12, 2014
Patent 6,950,807 B2
Before: Justin T. Arbes, David C. McKone, and Gregg I. Anderson
Written by: Arbes