United States: Swapping Order Of References In Non-Instituted Obviousness Combination Does Not Alter Scope Of IPR Estoppel

In an April 12, 2018 decision, the District Court for the District of Delaware held that a change in the primary reference of an obviousness combination that was denied institution by the Patent Trial and Appeal Board (PTAB) did not alter the scope of inter partes review (IPR) estoppel. 35 U.S.C. § 315(e)(2) provides that the petitioner in an IPR is estopped from raising in another proceeding any ground for invalidity that it raised, or reasonably could have raised, during the IPR. Although there is disagreement among district courts about the scope of estoppel, there is general agreement that a party is not estopped from raising grounds that were set forth in its petition, but not instituted for trial by the PTAB (i.e., non-instituted grounds). Some courts have limited the scope of estoppel to non-instituted grounds; others have gone further and applied IPR estoppel even to grounds that were not raised—but could have been raised—in the petition (i.e., non-petitioned grounds).

In Nox Medical EHF v. Natus Neurology Inc., defendant Natus had raised in an IPR petition certain obviousness combinations in the form of "A in view of B," and the PTAB declined to institute those claims for review. Natus raised some of those same combinations before the district court, but changed which reference in the combination was "primary" and which was "secondary"—i.e., raising "B in view of A" before the district court when it had raised "A in view of B" in its IPR petition. Plaintiff Nox Medical moved in limine for an order barring Natus from raising these combinations as estopped under § 315(e)(2).

Judge Richard Andrews held that, "for the combinations that Defendant tried to raise in the IPR, but which the PT AB did not institute, Defendant may pursue the combinations at trial. For those combinations 'A in view of B' on which the PTAB did not institute, I would regard that as reasonably raising 'B in view of A' also, and thus I reject Plaintiff's assertions to the contrary."  Order at 2-3. In other words, under the court's ruling, the ordering of references in an identical prior art combination is immaterial for purposes of estoppel under § 315(e)(2).

Nox Medical EHF v. Natus Neurology Inc., 1-15-cv-00709, Order (D. Del. April 12, 2018) (Andrews, J.)

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