SAS Prompts Post-Trial Stay of Entry of Judgment on Willful Infringement Verdict

Following a jury trial but prior to the entry of judgment, the court sua sponte stayed plaintiff's patent infringement action pending inter partes review after the PTAB reinstituted review in response to the Supreme Court's decision in SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018). "A jury returned a verdict in [plaintiff's] favor, finding that the asserted claims of the [patent-in-suit] are not invalid and that [defendants] willfully infringed the asserted claims. . . . Following the jury trial but prior to entry of final judgment . . . the Supreme Court held that the PTAB must address every claim a petitioner has challenged. Because the PTAB did not previously address every claim challenged by [defendants] -- specifically, the claims at issue in this litigation -- the PTAB modified its institution decision 'to include review of all challenged claims and all ground presented in the Petition.'. . . The Parties are instructed to notify the Court of the PTAB’s decision within five days of such decision and the Court shall re-open the matter. "

Prisua Engineering Corp. v. Samsung Electronics Co., Ltd. et al, 1-16-cv-21761 (FLSD June 12, 2018, Order) (Moore, USDJ)

PTAB’s Final Written Decision Addressing Some But Not All Challenged Claims No Basis for Lifting Stay

The court denied plaintiff's motion to lift a stipulated stay pending inter partes review because the PTAB had not resolved two uninstituted claims following the Supreme Court's decision in SAS Institute, Inc. v. Iancu, 138 S. Ct. 1348 (2018). "Although the PTAB denied institution of IPR proceedings with respect to claims 5 and 10, and issued a final written decision on all remaining claims, the Supreme Court recently ruled that the PTAB must issue a final written decision 'with respect to the patentability of any patent claim challenged,' and 'in this context, as in so many others, "any" means "every."' For this reason, the Federal Circuit remanded [defendant's] appeal to the PTAB for issuance of a final decision regarding the patentability of claims 5 and 10. Consequently, the PTAB has yet to resolve the patentability of all challenged claims in the pending IPR proceeding, and the terms of the parties' stipulation have not been satisfied."

DermaFocus LLC v. Ulthera, Inc., 1-15-cv-00654 (DED June 7, 2018, Order) (Fallon, MJ)

PTAB Dicta Does Not Trigger IPR Estoppel​

The court denied plaintiff's motion to exclude invalidity contentions on the ground that inter partes review estoppel precluded defendant from asserting two individual references after the PTAB instituted review on the combination of those references. "[T]he PTAB explicitly considered in its final written decision whether a subset of the instituted grounds was properly before it, and determined that it was not. . . . Though the PTAB then noted in dicta that '[e]ven if we were to consider [one reference] alone, we find that [reference] does not render the challenged claims obvious,' it is clear the PTAB did not believe any subset of the instituted grounds were properly before it. Given the PTAB’s explicit statements of what was 'properly part of [the IPR]' and what was not, the Court concludes that . . . only the instituted ground (obviousness based on the combination of [the two references]) gives rise to estoppel . . . ."

Oil-Dri Corporation of America v. Nestle Purina Petcare Company, 1-15-cv-01067 (ILND August 2, 2017, Order) (St. Eve, USDJ)

IPR Request and Post-Institution Fees Not Recoverable as Costs in Related District Court Case​

Following inter partes review that invalidated plaintiff's patent, the court denied defendant's motion to tax $23,000 in IPR request and post-institution fees as costs. "Defendant has raised an issue of first impression in this Court. But courts from two other circuits have considered this issue and declined to tax fees paid for the PTAB review . . . . [Defendant] urges the Court to adopt a broad reading of 'the Clerk' . . . because litigation 'shifts to that venue' and the IPR is a 'substitute for the district court proceeding.' The Court disagrees that the litigation 'shifted' to PTAB; PTAB merely determined the validity of [plaintiff's] patent, and this Court remained the adjudicator of the infringement suit. . . . PPG Indus., Inc. v. Celanese Polymer Specialties Co., 840 F.2d 1565, 1569 (Fed. Cir. 1988) is inapposite because the court was speaking only to the awarding of attorney fees [under] 35 U.S.C. § 285 . . . . That does not solve the problem that no statute authorizes a court to tax filing fees paid to the PTO. [Defendant] argues that it would be absurd if 'attorney fees within a substitute forum may be available, but the costs of transferring to that (more efficient) substitute forum are unreachable.' But the purported absurdity would hold for all the other deniable costs under 28 USC § 1920, and [defendant] has not made a case for why the IPR filing fee should be given special consideration."

Hockeyline, Inc. v. STATS LLC, 1-13-cv-01446 (NYSD April 27, 2017, Order) (McMahon, USDJ)

Eight Video Signal Transfer Patents Invalid Under 35 U.S.C. § 101 Despite Earlier PTAB Findings of Nonobviousness​

The court granted defendant's motion to dismiss because the asserted claims of plaintiff’s video signal transfer patents encompassed unpatentable subject matter and rejected plaintiff's argument that the claims did not lack an inventive concept because the PTAB found they were not obvious during inter partes review. "Plaintiff cites multiple opinions from the PTAB stating that the specifications of the intermediary device were not taught by the prior art and were therefore not obvious under 35 U.S.C. §§ 102 or 103. . . . Although there is some caselaw to suggest that obviousness, novelty, and eligibility inquiries overlap, the most recent and persuasive opinions conduct the eligibility inquiry in isolation. . . . That is not to say that the §§ 102 and 103 analyses are completely irrelevant to the eligibility question. Indeed, the same component or claim that distinguishes the invention from the prior art may also provide the 'innovative concept' that directs the claims to patent-eligible subject matter. . . . [T]he USPTO's inter partes decisions do not provide an answer to the question at hand. What those opinions do, however, is highlight the aspects of the [patent] family that might constitute an 'innovative concept' under step two of [Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S.Ct. 2347 (2014)]."

Virginia Innovation Sciences, Inc. v. Amazon.com, Inc., 1-16-cv-00861 (VAED January 5, 2017, Order) (O'Grady, USDJ)

Patent Directed to Supplemental Digital Broadcast Data Satisfies Financial Product or Service Requirement for CBM Review

The Board granted institution of covered business method review of a patent directed to "coordinating the transmission of supplemental digital data to accompany broadcast data" under 35 U.S.C. § 101, finding the patent was directed to a financial product or service. "[C]laim 6 requires the supplemental data to be advertising data and the ’172 patent teaches that advertising data is used to generate revenue. For example, the ’172 patent specification states explicitly that advertising presented as supplemental digital data may be sold. That advertising data is used in the practice of a financial product or service is consistent with ’172 patent Figure 1, which provides a 'conceptual overview of the implementation of the present invention' and expressly depicts 'rCommerce' with end users receiving supplemental data and purchasing songs, products or services through vendors . . . . "

Petition for Covered Business Method Patent Review by iHeartMedia, Inc., CBM2016-00010 (PTAB May 9, 2016, Order) (Tierney, APJ)

Buying and Selling Intellectual Property Rights Constitutes “Financial Product or Service” for CBM Review

The Board granted institution of covered business method review of an IP rights management patent, finding the patent was directed to a financial product or service. "[T]he [challenged] patent states that the invention provides an integrated rights management and licensing system and method involving the buying, and selling of intellectual property rights. . . . Patent Owner contends that none of the challenged claims expressly recites a method or apparatus for performing data processing or other operations used in the practice, administration or management of a financial product or service. We do not interpret the statute as requiring the literal recitation of the terms data processing of financial products or services. . . . The suggestion to adopt a definition limiting financial services or products to a particular industry, financial services industry, was considered but not adopted during rulemaking as the statute does not limit the program expressly to financial institutions, and such a narrow construction of the statute would be contrary to the legislative history of Section 18. . . . [T]he [challenged] patent claims systems and methods that are directed to a financial activity—buying and selling intellectual property rights—that constitutes a financial product or service under § 18(d)(1)."

Petition for Covered Business Method Patent Review by Getty Images (US), Inc., CBM2015-00023 (PTAB May 21, 2015, Order) (Tierney, APJ)

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Is the PTAB more likely to institute an IPR if the district court stays concurrent litigation?

A Docket Navigator subscriber recently asked us this question so we decided to investigate. As it turns out, there appears to be some correlation between a district court’s decision to stay a case pending IPR and the outcome of the PTAB’s institution decision. Click here to view a summary of our findings.