`571-272-7822
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` Paper 27
`Entered: April 5, 2013
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
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`MOTOROLA MOBILITY LLC
`Petitioner,
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`v.
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`Patent of MICHAEL ARNOUSE
`Patent Owner.
`____________
`
`Case IPR2013-00010
`Patent 7,516,484
`____________
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`
`
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`Before MICHAEL P. TIERNEY, JONI Y. CHANG, and JENNIFER S. BISK,
`Administrative Patent Judges.
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`TIERNEY, Lead Administrative Patent Judge.
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`DECISION
`MOTION TO WITHDRAW – 37 C.F.R. § 42.10(e)
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`Thomas D. Kohler and Lawrence H. Meier, counsel representing the
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`interests of the Patent Owner, have submitted a motion to withdraw from
`representation (Paper 25 (“Mot.”)). According to counsel, they represent Mr.
`Michael Arnouse, who has discharged them from further representation in
`connection with this inter partes review. Counsel state that their withdrawal from
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`Case IPR2013-00010
`Patent 7,516,484
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`this proceeding is mandatory under 37 C.F.R. § 10.40(b)(4). For the reasons
`discussed below, we are not persuaded that counsel have properly been discharged,
`and therefore we deny the motion as filed, without prejudice, and grant leave to file
`additional evidence and information in support of a renewed motion.
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`BACKGROUND
`Mr. Arnouse is said to be the owner of the ʼ484 patent for purposes of this
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`proceeding. Mot. 4-7. Specifically, counsel represents that Mr. Arnouse is the
`named inventor of the ’484 patent, and has not assigned his rights in the patent. Id.
`at 5. Counsel further states that, under the Office’s rules, Mr. Arnouse is presumed
`to be the owner absent such an assignment. Id.
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`According to a filing in District Court, however, Mr. Arnouse has provided
`an exclusive license of “all substantial rights” in the ’484 patent to a corporate
`entity, Arnouse Digital Devices (“ADD”). First Amended Complaint at 2, Arnouse
`Digital Devices Corp. v. Motorola Mobility, Inc., No. 5:11-cv-155 (D. Vt. filed
`Oct. 5, 2011) (Ex. 1007) (“Complaint”). Relying on the rights conferred by the
`exclusive license, ADD filed suit as plaintiff against Motorola Mobility Inc.
`(“Motorola”) in the District Court of Vermont. Id. In light of the averred transfer
`of all substantial rights in the ’484 patent, therefore, a question arises in this
`proceeding as to whether Mr. Arnouse (who was named as the real party-in-interest
`in the mandatory disclosures required under our rules) or ADD has the right to
`participate in proceedings before the Office regarding the ’484 patent. For the
`reasons provided below, we hold that counsel has failed to establish that Mr.
`Arnouse has the right to participate in the proceedings related to the ’484 patent
`before the Office. Thus, Mr. Arnouse does not have the right to discharge counsel
`in this proceeding
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`DISCUSSION
`Counsel seeks to withdraw based upon their representation of Mr. Arnouse
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`but not of ADD. A party requesting relief in an inter partes review bears the
`burden of proof to establish that it is entitled to the requested relief. 37 C.F.R.
`§ 42.20(c). The burden of proof is by a preponderance of the evidence. 37 C.F.R.
`§ 42.1(d). .
`
`The Leahy Smith American Invents Act (AIA) required the Office to
`promulgate rules governing inter partes reviews. The AIA further required that the
`Office, in prescribing those rules, consider the effect of the rules on the economy,
`the integrity of the patent system, the efficient administration of the Office, and the
`ability of the Office to timely to complete the proceedings. 35 U.S.C. § 316(b).
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`With these Congressionally-mandated goals in mind, the Office promulgated
`rules requiring both the petitioner and patent owner in an inter partes review
`proceeding to identify the real parties-in-interest. 37 C.F.R. § 42.8(b)(1).
`Consistent with these considerations, the Office’s Trial Practice Guide explains
`that the Board will apply traditional common-law principles in determining the real
`party-in-interest. Fed. Reg., Vol. 77 No. 157 (Aug. 14, 2012) at 48759. This
`uniformity of approach between the Federal Courts and the Office was intended to
`ensure that conventional principles of estoppel and preclusion would apply in both
`places, and that the integrity of the patent system will thus be preserved.
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`The question of who is the real party-in-interest when a patent is licensed
`has been judicially addressed in the context of standing. Thus, several Federal
`Circuit cases provide guidance on when an exclusive licensee has standing to sue
`for patent infringement in Federal Court. See, e.g., Sicom Sys. Ltd. v. Agilent
`Techs., Inc., 427 F.3d 971 (Fed. Cir. 2005); Prima Teck II, L.L.C. v. A-Roo Co.,
`222 F.3d 1372 (Fed. Cir. 2000). These cases hold that an exclusive licensee with
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`all substantial rights is the “effective patentee,” and thus meets the constitutional
`standing requirement to sue in its own name without mandatory joinder of the
`named patentee. Sicom, 427 F.3d at 976; Prima Tek, 222 F.3d at 1377. Here, by
`virtue of its averments of standing in the District Court, ADD has represented that
`it is the “effective patentee” under Sicom. Complaint at 2. However, before us,
`and contrary to their District Court representations, counsel asserts that it is Mr.
`Arnouse, and not ADD, that has the right to participate in proceedings before the
`Office. We are persuaded that the District Court rule should also apply here.
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`Underlying the Federal Circuit’s determination of whether the patentee is an
`indispensable party to an infringement lawsuit are the policy considerations of:
`(1) preventing the possibility of multiple suits on the same patent against a single
`infringer; and (2) ensuring that a patent is not invalidated or held unenforceable
`without the patent owner’s participation. Evident Corp. v. Church & Dwight Co.,
`399 F.3d 1310, 1314 (Fed. Cir. 2005). A uniform approach to what entity may
`participate in Office proceedings is consistent with these considerations.
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`Moreover, a determination that the same entity that has standing to bring a
`patent infringement suit in District Court also has the right to participate in
`proceedings at the Office is consistent with Federal Rule of Civil Procedure 19, the
`federal joinder rule. Under Rule 19(a), a person is a required party if:
`(A) in that person’s absence, the court cannot accord complete relief among
`existing parties; or
`(B) that person claims an interest relating to the subject of the action and is
`so situated that disposing of the action in the person’s absence may:
`(i)
`as a practical matter impair or impede the person’s ability to
`protect the interest; or
`leave an existing party subject to a substantial risk of incurring
`double, multiple, or otherwise inconsistent obligations because of
`the interest.
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`(ii)
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`Because Mr. Arnouse does not contend that he is a “required party” under Rule
`19(a) in the district court litigation, it follows that Mr. Arnouse’s participation is
`not required to defend the patentability of the ’484 patent in proceedings before us.
`However, the same is not necessarily true for ADD. As the undisputed holder of
`“all substantial rights” in the ʼ494 patent, ADD and not Mr. Arnouse is the real
`party-in-interest.
`Thus, we find that ADD and not Mr. Arnouse is the entity with the right to
`participate in proceedings before the Office related to the ’494 patent, including
`this inter partes review. Counsel does not provide any evidence that it has been
`discharged by ADD. Therefore, the motion is denied.
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`ORDER
`In view of the foregoing, it is therefore:
`ORDERED that Motion for Authorization to Withdraw as Counsel to Patent
`Owner is denied without prejudice;
`FURTHER ORDERED that counsel shall have ten days from the entry of
`this Order to submit additional evidence in support of the motion and to renew the
`motion;
`FURTHER ORDERED that because ADD is a juristic entity and therefore
`cannot proceed pro se in proceedings before the Office (37 C.F.R. § 1.31 (2012)),
`the renewed motion will not be considered unless it provides a designation of lead
`and back-up counsel for ADD as required by our rules. See 37 C.F.R. § 42.8(b)(3).
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`Patent 7,516,484
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`PETITIONER:
`Ko-Fang Chang
`Steven D. Moore
`KILPATRICK TOWNSEND & STOCKTON LLP
`kchang@kilpatricktownsend.com
`smoore@kilpatricktownsend.com
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`PATENT OWNER:
`Lawrence H. Meier
`Thomas D. Kohler
`DOWNS RACHLIN MARTIN PLLC
`lmeier@drm.com
`tkohler@drm.com
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