Conflict at the PTAB: Divided Expanded Panel Overturns Divided Joinder Decision

Authored by Michelle Carniaux and Michael E. Sander

In one of the first PTAB decisions of its kind, a 4 to 3 split expanded panel issued an opinion granting a rehearing request and effectively overturned an earlier panel’s decision to deny a joinder motion. See IPR2014-00508, No. 28 (Feb. 12, 2015).

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The Curious Case of New Bay Capital LLC and VirnetX Inc.

Authored by Michelle Carniaux and Michael E.Sander

In June 2013, a newly formed company called New Bay Capital, LLC (“New Bay”) filed four petitions for inter partes review of patents owned by a publicly traded patent licensing entity VirnetX Holding Corporation (“VirnetX”). See IPR2013-00375, 00376, 00377, and 00378. VirnetX had recently won a jury verdict against Apple Inc. (“Apple”) on the same patents for hundreds of millions of dollars and was proceeding through the appeals process against Apple. Neither New Bay nor its parent company, Eastern Shore Capital, LLC, were involved in the VirnetX litigation, nor does is appear that New Bay made or sold anything related to the technologies covered by the patents, so New Bay’s motive for filing four IPR petitions was unclear.

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Joinder Granted More than One Month after Institution

Authored by Michelle Carniaux and Michael E. Sander

According to 37 C.F.R. § 42.122(b), “any request for joinder must be filed . . . no later than one month after the institution date of any inter partes review for which joinder is requested.” However, in at least one case, a motion for joinder was granted even though it was filed after the one month deadline.

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Patent Owner Cancels All Claims in IPR in Apparent Bid to Avoid Second IPR of Additional Claims

Authored by A. Antony Pfeffer

On February 27, 2012, ContentGuard Holdings filed suit against ZTE Corporation in the Eastern District of Virginia, asserting U.S. Patent 7,225,160. On February 11, 2013, less than 12 months after that suit was filed, defendant ZTE Corporation petitioned for insitution of an Inter Partes Review (IPR 2013-134) of all claims of that patent. On June 19, 2013 the PTAB instituted an IPR only with respect to 12-22 and 30-38 of that patent.

On July 19, 2013, ZTE filed a second IPR addressing the claims of the ’160 patent for which no IPR had been instituted. [2013-454 Petition]. At this time, ZTE also filed a motion for joinder of these two IPR’s in an attempt to negate the 12 month bar of a petition for IPR after service of a complaint. [2013-454 Joinder]. The patent owner (ContentGuard Holdings) in an apparent bid to avoid this second IPR, requested, and the PTAB has now granted, adverse judgment on all the claims in IPR 2013-134. [2013-134 Judgment]. ZTE had requested that the PTAB not rule on the motion for entry of adverse judgment until after the motion to joinder had been ruled on. The PTAB rejected this request and has cancelled all the claims in IPR 2013-134. Accordingly, the IPR 2013-454 moved to be joined with has concluded. Exactly how the PTAB handles this situation with respect to IPR 2013-454 remains to be seen, but should prove interesting to patent owner’s looking for strategies to avoid follow-on IPR’s.

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Following Denial of Motion for Joinder, IPR Petition Denied

Authored by A. Antony Pfeffer

As we noted earlier this week, the PTAB denied NetApp’s motion to join its petition for IPR (2013-00319), with EMC Corporation’s earlier IPR (2013-00082). See IPR 2013-00319, No. 18 (P.T.A.B. July 22, 2013). Now, the PTAB has declined to institute IPR 2013-00319 under its “discretion under 35 U.S.C. § 314 and 37 C.F.R. § 42.108(b).” See IPR2013-00319, No. 19 (P.T.A.B. July 25, 2013).

Remember, NetApp’s IPR petition was filed more than one year from service of a complaint, so would be barred under 35 U.S.C. § 315 but for the motion for joinder that accompanied the petition. However, this motion for joinder was subsequently denied by the PTAB. The decision to not institute the IPR does not squarely address the issue of whether in certain circumstances it would be permissible to institute an IPR requested more than one year from the service of a complaint following the denial of a motion for joinder.

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