In an en banc decision issued today, January 8, 2018, the Federal Circuit ruled that a patent owner appealing an adverse inter partes review (IPR) decision can raise the issue whether the IPR should have been found to be time-barred. Wi-Fi One, LLC v. Broadcom Corp., No. 2015-1944, slip op. at 6 (Fed. Circ. Jan. 8, 2018) (“WiFi One”). The 9-4 decision relies on “the strong presumption in favor of judicial review of agency actions”[1] to overrule a prior Federal Circuit decision finding the time bar issue to be always non-appealable.[2] While the threshold substantive decision of whether a petitioner has shown a “reasonable likelihood” on the merits remains outside the scope of judicial review, a time-bar determination under § 315(b) that is part of an institution decision is now reviewable by the Federal Circuit. This will apparently also allow unsuccessful patent owners to raise on appeal issues regarding real-party-in-interest and privity as well.
Background
In 2010, Ericsson filed suit against manufacturers and sellers of WiFi networking equipment for alleged infringement of several wireless networking patents. Almost three years later, the case ended with a jury verdict finding the defendants liable for infringement and the patents to be not invalid. Broadcom was not a defendant in the litigation, but shortly after the jury verdict, Broadcom filed IPR petitions against three of the asserted patents in the litigation.[3]
Ericsson argued that Broadcom’s IPR petitions were time-barred because Broadcom was in privity with the litigation defendants and the defendants were outside of the one-year deadline to file a petition under § 315(b). The Patent Trial and Appeal Board (PTAB) found that Ericsson had failed to show that privity existed because Ericsson did not show that Broadcom had control over the litigation. The PTAB instituted IPRs for the three challenged patents and issued a final written decision finding the challenged claims unpatentable. The final written decision also found that Ericsson had not proven that the litigation defendants were in privity with Broadcom.
The Federal Circuit’s Decision
A Federal Circuit panel affirmed in 2016. On the time bar issue, the panel held that the issue could not be raised on appeal, relying on the earlier Achates decision.[4]
Rehearing the case en banc, the full Court reached the opposite conclusion. Citing the Supreme Court in Cuozzo,[5] the Court applied a “‘strong presumption’ favoring judicial review of administrative actions, including the Director’s IPR institution decisions.”[6] The Court reasoned that § 314(d)’s statement that “[t]he determination by the Director whether to institute an inter partes review under this section shall be final and nonappealable” is limited only to the Director’s determination regarding the merits of the petition under § 314. Because the time bar determination is made under § 315, the Court found that § 314’s limits on appealability do not apply. As a result, the Court remanded the case so that the panel could consider the patent owner’s argument that the petition was time-barred under § 315.
Significance of the Decision
The Federal Circuit’s decision will likely allow appeal not just of time bar determinations but also other issues under § 315. For example, patent owners and petitioners should focus on who might be a real party in interest and other issues relevant to § 315(b), which provides:
An inter partes review may not be instituted if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent.
Patent owners will want to consider raising on appeal whether petitioners have omitted any party that is arguably a real party in interest or privity and might be subject to the time bar of § 315(b). On the other hand, petitioners will want to be careful when a challenged patent has already been asserted against others. Additionally, previously unreviewable PTAB decisions that interpret § 315(b) to allow petitions (e.g., when a district court litigation has been dismissed without prejudice or when a party joins its own petition) could now be reviewable on appeal. Accordingly, care should be taken when considering which issues to raise on appeal of an IPR decision.
[1] Id.
[2] See Achates Reference Publishing, Inc. v. Apple Inc., 803 F.3d 652, 658 (Fed. Cir. 2015).
[3] Ericsson subsequently assigned the patents to Wi-Fi One, LLC.
[4] See Wi-Fi One, LLC v. Broadcom Corp., 837 F.3d 1329, 1333 (Fed. Cir. 2016) (“Wi-Fi does not dispute that Achates renders its challenge to the Board’s timeliness ruling nonappealable if Achates is still good law.”).
[5] Cuozzo Speed Technologies, LLC v. Lee, 136 S. Ct. 2131 (2016).
[6] WiFi One at 14 citing Cuozzo, 136 S. Ct. at 2140.
