Alert February 22, 2017

Issue Two: Keeping Tabs on the PTAB


The availability of post-grant proceedings at the Patent Trial and Appeal Board (PTAB) has changed the face of patent litigation. This monthly digest is designed to keep you up-to-date by highlighting interesting PTAB, district court, and Federal Circuit decisions relating to emerging post-grant issues.


In IPR2016-00734, Baker Hughes Inc. v. Lubrizol Specialty Prods., Inc., the Board granted Patent Owner Lubrizol’s motion for additional discovery. According to Lubrizol’s motion, Petitioner Baker Hughes and non-party Flowchem LLC had produced documents in litigation concerning the patent at issue in the IPR that bore directly on the issues of copying and nexus. In this rare grant of a motion for additional discovery, the Board found that Lubrizol’s motion met all of the Garmin factors, showing that the grant of the motion was in the interests of justice. The Board ordered Petitioner to produce the 24 specific documents and 18 pages of deposition testimony, and allowed Lubrizol to seek a subpoena from a district court requiring Flowchem to produce 13 specific documents and 57 pages of deposition testimony for use in the IPR. (Paper 44, Jan. 16, 2017.)

Takeaway: The Board does not often grant motions for additional discovery outside the context of real-party-in-interest. In this case, the Patent Owner was able to narrowly define both the documents sought and the impact that the documents would have on the case, which likely tipped the scales in favor of additional discovery.

In IPR2016-01274, Covidien LP v. University of Florida Research Foundation, Inc., the Board held that a state is immune from IPR under the Eleventh Amendment because of the similarities between inter partes review and litigation: “We conclude that the considerable resemblance between the two is sufficient to implicate the immunity afforded to the States by the Eleventh Amendment.” The similarities include the Rules of Evidence that govern the proceeding, the harm to which Patent Owner is subject if it fails to respond to a Petition, the availability of discovery and motion practice, the Petition’s similarities to a complaint in district court, the availability of a protective order, and the availability of sanctions. (Paper 19, Jan. 25, 2017.)

Takeaway: This case is a must-read for public universities and any party who is looking to petition against a patent owned by public university, a university foundation, or any other state entity. This case is also an interesting read because it carefully details the similarities between review at the PTAB and litigation.

In IPR2016-00303, Arista Networks, Inc. v. Cisco Sys., Inc., Patent Owner, in its Response, challenged the prior art status of one of Petitioner’s exhibits. In its reply, Petitioner submitted a declaration from a non-party to substantiate the prior art status of the exhibit. Patent Owner sought to take the declarant’s deposition, but the declarant’s employer would not voluntarily make the employee available. The Board authorized Petitioner to file a motion for leave to apply for a subpoena to compel the deposition. The Board explained that Petitioner must make the declarant available for deposition as a matter of routine discovery, and if the declarant was not made available, Petitioner runs that risk that the Board will not accord the declarant’s testimony any weight.  (Paper 29, Jan. 25, 2017.)

In IPR2016-00494, 1964 Ears, LLC v. Jerry Harvey Audio Holdings, LLC, the Board granted Petitioner’s motion to expunge an expert declaration that Patent Owner had filed along with its Patent Owner Response because the expert was not available for cross-examination. The Board, however, denied Petitioner’s motion to expunge two other declarations of that same expert because those declarations were prepared for an underlying litigation, and were not prepared specifically for the IPR. Thus, cross-examination of the expert with regard to the pre-existing declarations was not available as routine discovery. The Board stated that it would consider the lack of cross-examination when weighing the evidentiary value of the statements in the declarations. (Paper 40, Jan. 30, 2017.)

Takeaway: When preparing documents to file, keep in mind that all declarants who prepare and submit declarations for use in post-grant proceedings must be available for deposition.


In Verinata Health, Inc. v. Ariosa Diagnostics, Inc., No. 12-05501 (N.D. Cal. Jan. 19, 2017), the court ruled on the scope of estoppel. In a co-pending IPR, the Board issued a Final Written Decision that the challenged claims were not upatentable as obvious over a combination of Shoemaker, Dhallan, and Binladen. In view of this decision, the district court held that statutory estoppel under 35 U.S.C. § 315 barred defendants (Petitioners in the parallel IPR) from asserting that the patent was invalid as obvious over the combination of Dhallan + Binladen. Petitioners had included the Dhallan + Binladen argument in its petition, but the Board did not institute on this double combination, and instead instituted on a ground that included the triple combination of Shoemaker, Dhallan, and Binladen. Nevertheless, the district court found that “defendants raised, or could have raised,” Dhallan + Binladen in the IPR, because this combination “is simply a subset of the instituted grounds.” With respect to grounds that were not raised in the IPR petition, the court stated that estoppel did not extend to grounds based on Shoemaker, Dhallan, and Binladen “as combined with art not presented during IPR.”  (n.4.)

The court also held that judicial estoppel did not bar the defendants from raising all of the arguments asserted in the IPR petition. Plaintiff (Patent Owner in the IPR) argued that because the defendants had “argued numerous times before this Court that pending IPR petitions would simplify this litigation through statutory estoppel or invalidation,” the defendants should be judicially estopped from asserting any of the grounds that were raised or reasonably could have been raised in the IPR petition. The court rejected plaintiff’s position in part because the “Federal Circuit has only recently begun to clarify the scope of IPR estoppel, such that any inconsistency between [defendants’] previous and current positions is excusable.” (page 9).

Following the district court’s decision, plaintiff filed a petition for a writ of mandamus with the Federal Circuit. The issues presented in the petition are as follows:

  1. Do prior art grounds that the petitioner reasonably could have submitted in an IPR petition, but never did, qualify for § 315(e)(2) estoppel?
  2. Do prior art grounds that the PTAB rejected as part of its IPR institution decision qualify for a § 315(e)(2) estoppel, if the petitioner could have properly raised those grounds during institution had it met the legal standards for doing so?
  3. For purposes of § 315(e)(2) estoppel, are prior art “grounds” limited to the specific prior art publication that is the basis for the instituted IPR proceeding or are such grounds defined by the substance of the disclosure such that an argument based on alternative publication or combination might in fact be understood to be the same as an instituted ground and thus estopped?

Takeaway: The district courts continue to grapple with the contours of petitioner estoppel, and it is only a matter of time before the Federal Circuit takes up this issue. In Verinata, the court cabined IPR statutory estoppel to grounds raised in the IPR petition and instituted by the Board. Many questions remain to be answered about the scope of estoppel, including those listed by Verinata. Petitioners are well-advised to stay on top of this developing body of law, as estoppel can profoundly affect a petitioner’s IPR strategy.


In Phigenix Inc. v. ImmunoGen, Inc., (Fed. Cir. No. 16-1544, slip op. Jan. 9, 2017), the Federal Circuit dismissed Phigenix’s appeal from a PTAB Final Written Decision upholding the patentability of ImmunoGen’s patent claims because Phigenix lacked standing to bring suit in federal court.

The court explained that even if a party has standing to bring a challenge in an administrative agency, the party may not have Article III standing to appeal the agency’s decision to a federal court.  According to the court, where standing is not self-evident or was not previously addressed in the record, the appellant must supplement the record to explain and substantiate its entitlement to judicial review, e.g., through affidavits or other evidence submitted “at the first appropriate time,” whether in response to a motion to dismiss or in the opening brief. (Page 8.) The court suggested that a party would have standing to appeal a PTAB action if, for example, it faces risk of infringing the patent, is an actual or prospective licensee of the patent, or otherwise plans to take any action that would implicate the patent. (Page 9.)

According to Phigenix, it suffered an actual economic injury because ImmunoGen’s patent increases competition between Phigenix and ImmunoGen, and the patent has encumbered Phigenix’s efforts to license its own patent. The court found, however, that Phigenix had failed to establish injury in fact; a declaration submitted to support a finding of economic injury was conclusory and alleged only a hypothetical licensing injury. Phigenix also failed to allege that it was engaged in any activity that could give rise to an infringement suit.

Takeaway: This case leaves some PTAB Final Written Decisions unappealable. While parties may have become used to the lack of judicial review of institution decisions and often consider the lack of review in their PTAB strategies, in some cases, parties will now have to weigh the possibility of no judicial review at all as part of their PTAB strategy.