Trial@uspto.gov
`571-272-7822
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` Paper 19
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` Entered: July 2, 2014
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`RACKSPACE US, INC. and RACKSPACE HOSTING, INC.,
`Petitioners,
`
`v.
`
`PERSONALWEB TECHNOLOGIES, LLC and
`LEVEL 3 COMMUNICATIONS,
`Patent Owners.
`____________
`
`Case IPR2014-00062
`Patent 7,802,310 B2
`____________
`
`
`
`Before KEVIN F. TURNER, JONI Y. CHANG, and
`MICHAEL R. ZECHER, Administrative Patent Judges.
`
`TURNER, Administrative Patent Judge
`
`
`
`
`
`
`
`DECISION
`Request for Rehearing
`37 C.F.R. §§ 42.71
`
`
`571-272-7822
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` Paper 19
`
`
` Entered: July 2, 2014
`
`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`RACKSPACE US, INC. and RACKSPACE HOSTING, INC.,
`Petitioners,
`
`v.
`
`PERSONALWEB TECHNOLOGIES, LLC and
`LEVEL 3 COMMUNICATIONS,
`Patent Owners.
`____________
`
`Case IPR2014-00062
`Patent 7,802,310 B2
`____________
`
`
`
`Before KEVIN F. TURNER, JONI Y. CHANG, and
`MICHAEL R. ZECHER, Administrative Patent Judges.
`
`TURNER, Administrative Patent Judge
`
`
`
`
`
`
`
`DECISION
`Request for Rehearing
`37 C.F.R. §§ 42.71
`
`
`
`IPR2014-00062
`U.S. Patent 7,802,310 B2
`
`I. INTRODUCTION
`Rackspace US, Inc. and Rackspace Hosting, Inc. (collectively “Rackspace”)
`filed a request for rehearing (Paper 14, “Req. Reh’g”) of the decision on institution
`(Paper 9, “Dec.”), which instituted inter partes review of claims 1, 2, 5-8, 10-12,
`14, 16-19, 24, 29, 32, 70, 81, 82, and 86 of U.S. Patent No. 7,802,310 B2 (“the
`’310 Patent”). In its request, Rackspace essentially contends that the Board
`misapprehended the significance of Rackspace’s principal reasons for proposing
`multiple grounds, i.e., did not properly consider that patent owner may argue more
`specialized meanings for claim terms. Req. 1-2. The request for rehearing is
`denied.
`
`II. ANALYSIS
`When rehearing a decision on institution, the Board will review the decision
`for an abuse of discretion. 37 C.F.R. § 42.71(c). An abuse of discretion may be
`determined if a decision is based on an erroneous interpretation of law, if a factual
`finding is not supported by substantial evidence, or if the decision represents an
`unreasonable judgment in weighing relevant factors. Star Fruits S.N.C. v. U.S.,
`393 F.3d 1277, 1281 (Fed. Cir. 2005); Arnold P’ship v. Dudas, 362 F.3d 1338,
`1340 (Fed. Cir. 2004); and In re Gartside, 203 F.3d 1305, 1315-16 (Fed. Cir.
`2000).
`In determining whether to institute an inter partes review of a patent, the
`Board may “deny some or all grounds for unpatentability for some or all of the
`challenged claims.” 37 C.F.R. § 42.108(b). Rules for inter partes review
`proceedings were promulgated to take into account the “regulation on the economy,
`
`2
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`IPR2014-00062
`U.S. Patent 7,802,310 B2
`
`the integrity of the patent system, the efficient administration of the Office, and the
`ability of the Office to timely complete proceedings.” 35 U.S.C. § 316(b). In
`addition, as mandated by 35 U.S.C. § 316(a)(11), 37 C.F.R. § 42.100(c) was
`promulgated to require that the final written determination in an inter partes review
`to be issued one year after the date of institution, except that the review may be
`extended by not more than six months for good cause shown.
`In the decision on institution for the instant proceeding, we instituted an
`inter partes review of challenged claims 1, 2, 5-8, 10-12, 14, 16-19, 24, 29, 32, 70,
`81, 82, and 86 of the ’310 Patent —specifically as unpatentable under 35 U.S.C.
`§ 103(a) over Woodhill, Francisco, and Langer, in different combinations, based
`on Rackspace’s petition. Dec. 30. In rendering the decision on institution, we
`exercised our discretion in denying other asserted grounds as being redundant in
`light of the grounds for which review was instituted. Dec. 28-30. We also
`indicated that “even though Rackspace discusses the different methods and
`systems of Kinetech, Brunk, and Francisco, Rackspace does not explain adequately
`the relative strengths or weaknesses between these applied prior art references.”
`Dec. 29.
`Rackspace argues that it provided such distinctions, “albeit succinctly” (Req.
`Reh’g 2), in its petition when it discussed how a published counterpart of the ’310
`patent invalidates all later claimed obvious variations. Id. From this, Rackspace
`argues that it demonstrated the strength of grounds #1 and #2, i.e., over Kinetech,
`Brunk, and Francisco, and contrasted those with the relative strengths of grounds
`#3 and #4, i.e., the instituted grounds. Req. Reh’g 2-3. We do not agree.
`
`3
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`IPR2014-00062
`U.S. Patent 7,802,310 B2
`
`Although all of the grounds certainly were discussed in the petition, we do
`not discern any relative strength or weakness comparisons being made therein. In
`contrast, Rackspace also provides that “[t]hese additional grounds [grounds #3 and
`#4] apply patent references that antedate even the earliest priority date alleged,”
`(Pet. 10), such that a lack of any potential date problem could arguably suggest that
`the instituted grounds were preferable. The discussions of both sets of grounds
`indicate that “[t]rial should be instituted on at least these grounds,” (id.), and we
`can find no argument one set would be preferable over the other. The fact that
`Rackspace points out explicitly now the relative benefits of certain grounds over
`others does not mean that we misapprehended or overlooked such benefits. In
`other words, we could not have misapprehended or overlooked an argument that
`was not presented in the first instance in the petition.
`Rackspace also argues that because the grounds in another, related instituted
`trial, specifically IPR2013-00058, include the Kinetech reference, the “institution
`of trial on Grounds #1 and #2 [in this trial] does not add any substantial burden on
`the PTAB or Patent Owners: the very same dispositive issues of priority and the
`disclosure and teachings of Kinetech/Farber will already be extensively analyzed,
`briefed, and argued to the Board in IPR2013-00058.” Req. Reh’g 5. However, we
`do not agree that doubling the number of grounds in the instant proceeding would
`not double the amount of work to complete this proceeding.
`As discussed above, the Board’s rules for AIA post-grant proceedings,
`including those pertaining to institution, are “construed to secure the just, speedy,
`and inexpensive resolution of every proceeding.” 37 C.F.R. § 42.1(b); see also 35
`U.S.C. § 316(b) (regulations for AIA post-grant proceedings take into account “the
`
`4
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`IPR2014-00062
`U.S. Patent 7,802,310 B2
`
`efficient administration of the Office” and “the ability of the Office to timely
`complete [instituted] proceedings”). Therefore, we exercised our discretion and
`did not institute a review based on the other asserted grounds for reasons of
`administrative necessity to ensure timely completion of the instituted
`proceeding. See 37 C.F.R. § 42.108(a). Thus, we are not persuaded that the
`decision on institution should be altered to encompass additional grounds of
`unpatentability.
`For the foregoing reasons, Rackspace has not shown that the Board abused
`its discretion in denying the additional grounds as the basis for the instant
`proceeding.
`
`III. CONCLUSION
`Rackspace’s Request for Rehearing is denied.
`
`
`
`
`
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`5
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`6
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`IPR2014-00062
`U.S. Patent 7,802,310 B2
`
`For PETITIONER:
`David W. O’Brien
`J. Andrew Lowes
`John Russell Emerson
`HAYNES AND BOONE, LLP
`david.obrien.ipr@haynesboone.com
`andrew.lowes.ipr@haynesboone.com
`russell.emerson.ipr@haynesboone.com
`
`Paul V. Storm
`GARDERE WYNNE SEWELL LLP
`pvstorm@gardere.com
`
`
`
`For PATENT OWNER:
`Joseph A. Rhoa
`Updeep S. Gill
`NIXON & VANDERHYE P.C.
`jar@nixonvan.com
`usg@nixonvan.com
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