United States: Federal Circuit Patent Watch: IPR Estoppel May Apply Where Simultaneous Petitions Were Filed By The Same Petitioner On The Same Claim

Precedential Federal Circuit Opinions

1.  INTUITIVE SURGICAL, INC. v. ANDREW HIRSHFELD [OPINION]  (2020-1481, February 11, 2022) (O'MALLEY, CLEVENGER, and STOLL)

O'Malley, J.  Affirming PTAB decision finding petitioner estopped from maintaining the IPR and terminating petitioner as a party under 35 U.S.C. § 315(e)(1). The Board concluded that section 315(e)(1) did not preclude estoppel from applying where simultaneous petitions were filed by the same petitioner on the same claim. As an initial matter, an estoppel-triggering event subsequent to the institution decision "could not have affected the decision to initiate the administrative proceeding" and was thus not so "closely tied" to institution as to preclude judicial review under § 314(d). On the merits, Section 315(e)(1) estops a petitioner as to invalidity grounds for an asserted claim that it failed to raise but "reasonably could have raised" in an earlier decided IPR, regardless of whether the petitions were simultaneously filed and regardless of the reasons for their separate filing. Petitioner failed to take advantage of statutory routes to avoid estoppel. It did not seek to consolidate the three proceedings; it did not divide its petitions according to subsets of claims. And, while it did request a consolidated hearing (a request the Board granted), it did not ask that the cases proceed to final written decision on the same timetable. With these choices left unpursued, it cannot be concluded that petitioner could not "reasonably have raised" its grounds from the later IPR in the prior proceedings. Once section 315(e)(1) prohibited petitioner from maintaining the IPR, petitioner ceased to be a party under sections 141 and 319, placing it outside the zone of interest established by the congressionally authorized right to appeal.

2.  LARRY G. JUNKER v. MEDICAL COMPONENTS, INC., MARTECH MEDICAL PRODUCTS, INC. [OPINION]  (2021-1649, February 10, 2022) (DYK, REYNA, and STOLL)

Stoll, J.  Reversing the district court's summary judgment of no invalidity under the on-sale bar. The question was whether a letter was a commercial offer for sale of the claimed design, or merely a quotation signaling the parties were engaged in preliminary negotiations. The fact that the letter used the word "quote" three times was an important fact supporting the district court's conclusion that the letter was a quotation, not a definite offer. While the precise label used for a given communication is relevant, it is not controlling. Rather, the terms of the communication must be considered in their entirety to determine whether an offer was intended, or if it was merely an invitation for an offer or further negotiations. A quotation typically leaves many terms necessary to a contract—such as place of delivery, payment terms, and the like—unexpressed. The letter—which specified multiple sized products for sale, different bulk pricing options available for each product, payment terms (net 30- day basis), and delivery terms and conditions (bulk shipment, non-sterile, FOB)—contained all the required elements to qualify as a commercial offer for sale.  The letter offered for sale multiple sizes of products with tiered pricing depending on the number of sets desired. That there were multiple offers does not mean that there was no offer to be accepted. And that the letter did not specify the exact amount desired by the offeree likewise did not mean that there is no offer to be accepted. The completeness of the relevant commercial sale terms in the letter signaled that the letter was not merely an invitation to further negotiate, but rather multiple offers for sale, any one or more of which could have been simply accepted to bind the parties in a contract.

3.  QUALCOMM INCORPORATED v. APPLE INC. [OPINION]  (2020-1558, 2020-1559, February 1, 2022) (TARANTO, BRYSON, and CHEN)

Chen, J.  Vacating PTAB decisions finding several challenged claims unpatentable. To reach its unpatentability finding, the Board relied on a ground raised by petitioner that relied in part on applicant admitted prior art (AAPA)—here, statements in the challenged patent acknowledging that most of the limitations of the patent's claims were already known—and a prior art patent. Patent Owner argued that the Board's reliance on AAPA runs afoul of 35 U.S.C. § 311(b), which limits an inter partes review petitioner to challenge claims as unpatentable "only on a ground that could be raised under section 102 or 103 and only on the basis of prior art consisting of patents or printed publications." The Board erred in concluding that AAPA constitutes "prior art consisting of patents or printed publications" under § 311(b). While, under § 311(b), AAPA contained in the challenged patent is not "prior art consisting of patents or printed publications," it does not follow that AAPA is categorically excluded from an inter partes review. On remand, the Board should determine whether AAPA improperly formed the "basis" of the petition or whether the petition raises its § 103 challenge on the basis of prior art consisting of patents or printed publications.

4.  PLASMACAM, INC. v. CNCELECTRONICS, LLC [OPINION]  (2021-1689, February 3, 2022) (NEWMAN, DYK, and REYNA)

Dyk, J.  Reversing district court's judgment ordering defendant to execute plaintiff's version of settlement agreement. The record reflects that during negotiations after the initial agreement, the parties disagreed regarding which products the covenant not to sue would cover. However, the record also establishes that plaintiff ultimately agreed to defendant's proposed Covered Products definition. The district court's sole basis for disregarding this explicit agreement was that the Covered Products concession was contingent on defendant's agreement to plaintiff's proposal regarding the mutual release. There is no support in the record for any such qualification of the agreement. Nothing in plaintiff's acceptance made its assent to the Covered Products term contingent on adopting plaintiff's version of the mutual release. To be sure, the agreement concerning the definition of Covered Products was contingent on reaching an agreement with respect to the mutual release language. The parties continued negotiations over the mutual release, and eventually did reach such an agreement. 

5.  BLEPHEX, LLC v. MYCO INDUSTRIES, INC. [OPINION]  (2021-1149, 2021-1365, February 3, 2022) (MOORE, Chief Judge, SCHALL and O'MALLEY)

O'Malley, J.  Affirming district court's grant of preliminary injunction. As an initial matter, the burden was on the defendant to produce some evidence to raise a substantial question of validity; to fulfill that burden, the defendant needed only to assert a defense that plaintiff cannot show lacks substantial merit. In the context of a preliminary injunction, the question of whether a movant has shown a likelihood of success in showing patent validity is reviewed for abuse of discretion. The district court did not clearly err when it concluded that the figures of the prior art patent depicted separate embodiments and that, therefore, defendant's argument that they depicted the same anticipating embodiment failed to raise a substantial question of validity. Nor did the district court clearly err in finding that defendant's conclusory obviousness argument—consisting of only a single sentence appended to its anticipation argument—did not pose a substantial question of validity. Defendant failed to present any evidence regarding the factual considerations underlying the obviousness inquiry, including whether a skilled artisan would have been motivated to modify the relevant device. Generally, expert testimony is not required at the preliminary injunction stage, but where the level of skill in the art is so high, conclusory attorney argument was not enough. The district court did not abuse its discretion when it barred all domestic sales of the accused product, as to which there was no evidence that the device had ever actually been used in a non-infringing manner. Finally, the preliminary injunction was not improper where the patent issued after the accused product had launched—the "status quo" when the preliminary injunction was filed was a state in which the patent had been granted and could be asserted. In any event, preservation of the status quo is not the sole objective of preliminary injunctions, which also serve to prevent ongoing trespasses during the pendency of an infringement case. Even where a patent is applied for and granted after the allegedly infringing product enters the market, a preliminary injunction may still be used to prevent future trespasses on the patent, so long as the district court correctly applies the relevant factors.

6.  APPLE INC. v. WI-LAN INC. [OPINION]  (2020-2011, 2020-2094, February 4, 2022) (MOORE, Chief Judge, BRYSON and PROST)

Moore, J.  Affirming-in-part, reversing-in-part, and vacating-in-part damages award of $85.23 million and district court judgment that the relevant patent claims were infringed and not invalid. On claim construction, the term "subscriber unit" should not be construed as CPE because the written description reveals that a CPE is a type of "subscriber unit"; the fact that a CPE is an example of a subscriber unit, however, does not show those terms are interchangeable; and the patents do not describe the invention as limited to a CPE. Substantial evidence supported the jury's finding that the accused products as sold had a subscriber unit, i.e., a module that allocates bandwidth across its user connections. The district court abused its discretion by denying defendant's motion for a new trial on damages. The relevant licenses alleged to be comparable treated the asserted patents as chaff, not wheat.  None of the license agreements treated an asserted patent as a key patent, and no testimony on negotiations suggested the contrary. One of the licenses listed an asserted patent as one of the six "Asserted Patents," but plaintiff's expert failed to address the extent to which these other patents contributed to the royalty rate in that license—his silence on these equally situated patents was troubling and made his opinion unreliable. There was no abuse of discretion in granting a new trial on the ground that plaintiff's testimony about the benefits of the patented invention should not have been presented to the jury. The inventors of the patented technology admittedly did not invent Voice over Long-Term Evolution (VoLTE), which provided voice call service over a 4G LTE network. Thus, plaintiff's testimony conflating the patented technologies with VoLTE lacked a factual basis and should not have been presented to the jury.

7.  QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. [OPINION]  (2020-2070, 2020-2072, February 4, 2022) (NEWMAN, LOURIE, and O'MALLEY)

O'Malley, J.  Affirming decisions of the PTAB finding that the challenged claims were not unpatentable as obvious. The intrinsic evidence made clear that the term "lidar" meant pulsed time-of-flight lidar. The specification focused exclusively on pulsed time-of-flight lidar and implied that the term "lidar" only meant pulsed time-of-flight lidar. Although petitioner pointed to the fact that the acronym lidar stands for "Laser Imaging Detection and Ranging," simply restating what the "lidar" acronym stood for did little to explain the term's meaning in light of the specification. Substantial evidence supported the Board's findings that the relevant prior art neither disclosed nor suggested the use of a pulsed time-of-flight lidar system and that one of skill in the art would not have been motivated by the relevant art to use a pulsed time-of-flight system. Substantial evidence also supported the Board's presumption of a nexus and its analysis of each objective indicia. The Board's explanation of how each alleged unclaimed feature resulted directly from claim limitations—such that patent owner's products are essentially the claimed invention—was both adequate and reasonable.

8.  CALIFORNIA INSTITUTE OF TECHNOLOGY v. BROADCOM LIMITED [OPINION]  (2020-2222, 2021-1527, February 4, 2022) (LOURIE, LINN, and DYK)

Linn, J.  Affirming in part and vacating in part district court judgment and damages award. With respect to two of the asserted patents, the district court's claim construction of "repeat" was correct, given that the claims required repeating but did not specify how the repeating was to occur, and substantial evidence supported the jury's verdict of infringement. With respect to the third asserted patent, the district court erred in refusing to instruct the jury of the interpretation the parties and the court reached during summary judgment. The district court did not err in granting summary judgment of no invalidity, barring defendants from presenting an invalidity case at trial on the ground of statutory estoppel. Estoppel applies not just to grounds asserted in the petition and instituted for consideration by the Board, but to all grounds not in the IPR but which reasonably could have been included in the petition. With respect to damages, in the absence of a compelling showing otherwise, a higher royalty is not available for the same device at a different point in the supply chain. In the absence of some evidence that companies in the positions of defendants would have engaged in such separate negotiations and in the absence of additional facts that might have justified separate and different treatment of the same chips at different levels of the supply chain, the mere fact that defendants were separate infringers alone did not support treating the same chips differently at different stages in the supply chain and did not justify submitting a two-tier damage theory to the jury.

9.  NIPPON SHINYAKU CO., LTD. v. SAREPTA THERAPEUTICS, INC. [OPINION]  (2021-2369, February 8, 2022) (NEWMAN, LOURIE, and STOLL)

Lourie, J.  Reversing decision of the district court and remanding for entry of a preliminary injunction. Under the plain language of the contract, defendant was required to bring all disputes regarding the validity of plaintiff's patents—including the allegations and contentions contained in defendant's IPR petitions—in the District of Delaware. Defendant instead brought those disputes in the form of IPR petitions at the Board, which contravened the plain language of the forum selection clause in the contract.

10.  UNILOC USA, INC. v. APPLE INC. [OPINION]  (2021-1568, 2021-1569, 2021-1570, 2021-1571, 2021-1573, February 9, 2022) (LOURIE, MAYER, and CUNNINGHAM)

Lourie, J.  Vacating and remanding district court decision refusing to seal certain documents in related cases. The district court failed to follow remand instructions to make particularized determinations as to whether the third-party licensing information sought to be sealed should be made public. Nowhere in the record did the district court discuss whether any of the third-party materials constituted protectable trade secrets. The district court made an error of law in making a blanket ruling that the public had a broad right to licensing information relating to patents. Absent an issue raised by the parties concerning license rights and provisions, there was no public interest or entitlement to information concerning consideration for the grant of the licenses. The parties agreed that the license information here should be sealed and protected.

11.  ALARM.COM INCORPORATED v. ANDREW HIRSHFELD [OPINION]  (2021-2102, February 24, 2022) (TARANTO, CHEN, and CUNNINGHAM)
Taranto, J.  Reversing district court decision dismissing complaint, which sought APA review of Director's decision to vacate certain ex parte reexamination proceedings based on the estoppel provision of the IPR regime. The Director found that requestor reasonably could have raised its reexamination grounds in IPRs and so was estopped under § 315(e)(1) from submitting each of its ex parte reexamination requests. The Director's estoppel determinations did not include any determination that no substantial new question of patentability had been raised. APA challenge to the Director's vacatur decisions based on estoppel was not precluded. The text, statutory scheme, and legislative history pertaining to ex parte reexamination did not evince a fairly discernable intent to preclude judicial review of those decisions.

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