`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`____________
`
`ION GEOPHYSICAL CORPORATION
`AND ION INTERNATIONAL S.A.R.L.,
`
`Petitioners,
`
`v.
`
`WESTERNGECO LLC,
`
`Patent Owner.
`
`____________
`
`Case IPR2015-00565
`
`U.S. Patent No. 7,293,520
`
`____________
`
`PATENT OWNER WESTERNGECO LLC’S
`OPPOSITION TO PETITIONERS’ MOTION FOR JOINDER
`
`
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`
`
`
`I.
`
`INTRODUCTION
`
`ION Geophysical Corporation and ION International S.a.r.l. (collectively,
`
`“Petitioner” or “ION”) challenged the validity of U.S. Patent No. 7,293,520 (“the
`
`520 patent”) through five years of litigation, which ION lost and did not appeal.
`
`Thus, ION’s current argument that joinder to IPR2014-00689 (“the ’689 IPR”)
`
`allows ION to “maintain its ongoing interests in the Office’s review of the ’520
`
`patent” falls flat. Mot. for Joinder, Paper 4 at 11. ION could have protected its
`
`purported “ongoing interests” in the ’520 patent by appealing validity directly to
`
`the Federal Circuit. But, ION chose not to.
`
`Allowing ION to revive its abandoned “interests” by joining the present
`
`proceeding—a request ION delayed making until the last possible day—threatens
`
`complication, delay, and prejudice. Due to the final judgment in the district court
`
`litigation, ION’s joinder raises the additional questions of whether collateral
`
`estoppel and res judicata bar ION’s challenges. ION’s Petition also raises
`
`questions regarding real party-in-interest (“RPII”). These issues will require
`
`additional discovery and briefing, and can serve only to delay the proceedings.
`
`Tellingly, ION’s motion invites the Board to extend these proceedings under 35
`
`U.S.C. § 316(a)(11) to accommodate the complications joinder will engender.
`
`Mot. for Joinder, Paper 4 at 7-8.
`
`Joinder is simply not appropriate in this case for the following reasons:
`
`
`
`1
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`First, joinder is not a “cost-effective alternative to litigation” as ION alleges
`
`in its motion. Mot. for Joinder, Paper 4 at 11. After five years, the litigation is
`
`over. ION’s joinder offers only additional and duplicative—not “alternative”—
`
`costs and burdens to a trial that is one of three related IPRs: the ’689 IPR,
`
`IPR2014-00687, and IPR2014-00688. Patent Owner has coordinated discovery
`
`with the Petitioner in those proceedings, Petroleum Geo-Services Inc. (“PGS”),
`
`and indeed, those proceedings are already at an advanced stage. Depositions have
`
`been conducted, and Patent Owner’s responses are due in only a few weeks.
`
`Introducing a third set of attorneys at this late stage would only exacerbate
`
`discovery coordination difficulties, resulting in further delays to the ’689 IPR’s
`
`trial schedule.
`
`Second, ION wrongly states that its “grounds of unpatentability . . . are
`
`identical to those at issue in the first PGS IPR.” See Paper 4 at 6-7. ION’s Petition
`
`includes multiple grounds that were not instituted in the ’689 IPR. Re-considering
`
`these grounds on which the Board already denied institution will only complicate
`
`the proceedings and delay their resolution.
`
`Third, joinder would require a significant delay to the trial schedule for the
`
`existing review. Collateral estoppel, res judicata and RPII would have to be
`
`addressed as serious issues that require both a response from Patent Owner and a
`
`ruling from this Board. Even ION recognizes that joinder would require a
`
`
`
`
`
`
`2
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`significant extension to the existing schedule by referencing 35 U.S.C.
`
`§316(a)(11). Mot. for Joinder, Paper 4 at 7-8.
`
`And fourth, ION’s motion fails to “address specifically how briefing and
`
`discovery may be simplified.” ION carefully parses its diction throughout its
`
`motion to imply simplification without actually committing to any: “ION is willing
`
`to accept reasonable restrictions on briefing and discovery” (without specifying
`
`any restrictions); “ION is willing to accept reasonable reductions in the time
`
`periods applicable to its filings” (without specifying any reductions); “ION is
`
`willing to entertain . . . briefing and discovery procedures similar to . . . IPR2013-
`
`00256” (without specifying which procedures, let alone agreeing to them). See
`
`Mot. for Joinder, Paper 4 at 3, 8, 9. ION has failed to meet its burden to show that
`
`joinder is warranted.
`
`II. DISCUSSION
`While the Board is authorized to grant joinder when warranted, the Board
`
`should exercise its discretion and deny joinder here based on the many
`
`complexities that ION’s joinder introduces, the ensuing trial delay, and the
`
`prejudice to the Patent Owner. 35 U.S.C. § 315(c); 37 C.F.R. § 42.122(b). Joinder
`
`“may be warranted in certain circumstances, but is not required in any.” Butamax
`
`Advanced Biofuels v. Gevo, IPR2014-00581, Paper 8 at 7 (Oct. 14, 2014)(emphasis
`
`added). The Board determines whether to grant joinder “on a case-by-case basis,
`
`
`
`
`
`
`3
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`taking into account the particular facts of each case, substantive and procedural
`
`issues, and other considerations.” Shaw Indus. Grp., Inc. v. Automated Creel Sys.,
`
`IPR2013-00584, Paper 20 at 3 (Dec. 31, 2013); see also 157 Cong. Rec. S1376
`
`(daily ed. Mar. 8, 2011) (statement of Sen. Kyl). The facts here weigh heavily
`
`against joinder.
`
`Granting joinder would make the ’689 IPR unruly, burdensome, costly, and
`
`slow, jeopardizing this Board’s ability to complete the proceeding by the
`
`statutorily mandated deadline. These are all considerations that are weighed by the
`
`Board. For example, the Board considers how joinder would impact the trial
`
`schedule and costs of the current proceeding. See Kyocera Corp. v. SoftView, LLC,
`
`IPR2013-00004, Paper 15 at 4 (Apr. 24, 2013). The Board also assesses whether
`
`“joinder would have a significant adverse impact on the Board’s ability to
`
`complete the existing proceeding in a timely manner.” Shaw Indus. Grp., Inc.,
`
`IPR2013-00584, Paper 20 at 5; see also 37 C.F.R. § 42.1 (b). Additionally, the
`
`Board is mindful that patent trial regulations, including the rules for joinder, must
`
`be construed “to secure the just, speedy, and inexpensive resolution of every
`
`proceeding.” 37 C.F.R. § 42.1(b). Granting joinder would raise Patent Owner’s
`
`costs while slowing down the ’689 IPR to a snail’s pace.
`
`A.
`
`ION Has Not Shown It is Entitled to Joinder
`
`ION shoulders the burden to establish that it is entitled to the requested
`
`
`
`
`
`
`4
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`relief, and it has failed to carry that burden here. See 37 C.F.R. § 42.20(c). See
`
`Samsung Elecs. Co., Ltd. et al. v. Arendi S.A.R.L., IPR2014-01144, Paper 11 at 7
`
`(Oct. 2, 2014) (finding that petitioner had not met its burden to show that joinder
`
`was appropriate.) To meet this burden, ION must, inter alia, “explain what impact
`
`(if any) joinder would have on the trial schedule for the existing review; and . . .
`
`address specifically how briefing and discovery may be simplified.” Macronix
`
`Int’l Co., Ltd. et al. v. Spansion LLC, Case IPR2014-00898, Paper 15 at 4 (Aug.
`
`13, 2014) (citing Kyocera, Paper 15 at 4). ION addressed neither.
`
`ION has failed to meet its burden by ignoring the substantial new issues that
`
`joinder would introduce to the ’689 IPR and by failing to account for the briefing
`
`and delays associated with these issues. Importantly, ION fails to explain how
`
`joinder would impact the trial schedule, simply making the broad statement that
`
`“[j]oinder will not affect timely completion” of the ’689 IPR without providing any
`
`proposed schedule should joinder be granted. Mot. for Joinder, Paper 4, at 7. ION
`
`also fails to demonstrate how briefing or discovery may be simplified, again
`
`broadly stating that “briefing and discovery are not complicated” without
`
`providing any concrete details. Id. at 8. ION has simply failed to carry its burden.
`
`B.
`
`ION’s Joinder Introduces New Questions of Res Judicata and
`Collateral Estoppel
`Joining this IPR with the ’689 IPR will introduce the new legal issues of res
`
`judicata and collateral estoppel that will require additional briefing and will
`
`
`
`
`
`
`5
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`undoubtedly result in a delay of the ’689 IPR trial schedule. On June 12, 2009,
`
`WesternGeco sued ION for infringement of multiple patents, including the ’520
`
`patent. See WesternGeco LLC v. ION Geophysical Corp., No. 09-cv-01827 (S.D.
`
`Tex. 2009) (the “ION litigation”). ION counterclaimed that the ’520 patent was
`
`invalid. Ex. 2004 at 10. ION’s arguments failed at trial with the jury correctly
`
`finding that the ’520 patent was not anticipated by, or obvious over, the prior art.
`
`Ex. 2003. The Court upheld the jury’s finding of no invalidity after post-trial
`
`motions, and entered judgment on May 7, 2014. See Ex. 2005. ION has decided
`
`not to appeal this aspect of the judgment or the jury’s validity finding.1 As a result,
`
`ION is now precluded by res judicata and collateral estoppel from challenging the
`
`’520 patent’s validity here, as Patent Owner will show should joinder be granted.
`
`
`1 ION filed a notice of appeal and docketing statement that it would appeal those
`
`issues. Ex. 2001. Once PGS filed its Petition to challenge the validity of the ’520
`
`patent in the ’689 IPR, however, ION dropped that issue from the pending appeal,
`
`implying at least reliance on PGS’ Petition if not outright coordination between the
`
`two companies. Conversely, ION has challenged the EPO counterpart of the ’520
`
`patent in administrative proceedings before that body, whereas PGS has not,
`
`apparently relying on the reverse arrangement. This raises not only issues of
`
`collateral estoppel and res judicata, but also of RPII.
`
`
`
`
`
`
`6
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`The Restatement of Law, Judgments 2d (Ex. 2002) (“Restatement”)2 defines
`
`res judicata and collateral estoppel, both of which serve as a bar to ION’s claim:
`
`§ 17. Effects of Former Adjudication–General Rules
`
`A valid and final personal judgment is conclusive between the parties,
`except on appeal or other direct review, to the following extent:
`
`. . . (2) If the judgment is in favor of the defendant, the claim is
`extinguished and the judgment bars a subsequent action on that claim
`(see § 19);
`
`(3) A judgment in favor of either the plaintiff or the defendant is
`conclusive, in a subsequent action between them on the same or a
`different claim, with respect to any issue actually litigated and
`determined if its determination was essential to that judgment (see §
`27).
`
`a) Res Judicata
`
`Restatement § 17(2) further defines res judicata, or the concept of “bar,” and
`
`§ 23 demonstrates its applicability to the facts here:
`
`§ 23. Judgment for Plaintiff on Defendant’s Counterclaim
`
`
`2 When applying res judicata and collateral estoppel, the Federal Circuit looks to
`
`the Restatement. See e.g., In re Freeman, 30 F.3d 1459, 1465 (Fed. Cir. 1994);
`
`Jet, Inc. v. Sewage Aeration Systems, 223 F.3d 1360, 1363 (Fed. Cir. 2000).
`
`
`
`
`
`
`7
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`Where the defendant interposes a claim as a counterclaim and a valid
`and final judgment is rendered against him on the counterclaim, the
`rules of bar are applicable to the judgment.
`
`
`
`Moreover, res judicata bars any invalidity arguments ION raised or could
`
`have raised in the previous litigation. San Remo Hotel, L.P. v. City & Cnty. of
`
`S.F., 545 U.S. 323, 336 n.16 (2005) (emphasis added) (“Under res judicata, a final
`
`judgment on the merits of an action precludes the parties or their privies from
`
`relitigating issues that were or could have been raised in that action.”).
`
`Accordingly, the facts here bar ION’s case in total and ION cannot now proceed
`
`with this action, as Patent Owner will show should joinder be granted.
`
`b) Collateral Estoppel
`
`
`
`In addition to res judicata, collateral estoppel (or issue preclusion) also
`
`precludes ION’s case. The general rule for collateral estoppel is stated in
`
`Restatement § 27:
`
`§ 27. Issue Preclusion–General Rule
`
`When an issue of fact or law is actually litigated and determined by a
`valid and final judgment, and the determination is essential to the
`judgment, the determination is conclusive in a subsequent action
`between the parties, whether on the same or a different claim.
`
`The issue preclusion test contains four factors, each of which is satisfied
`
`here:
`
`
`
`
`(1) the issue is identical to one decided in the first action;
`
`
`
`8
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`
`(2) the issue was actually litigated in the first action;
`
`(3) resolution of the issue was essential to a final judgment in the first
`action; and
`
`(4) plaintiff had a full and fair opportunity to litigate the issue in the
`first action.
`
`In re Freeman, 30 F.3d at 1465 (Fed.Cir. 1994).
`
`
`
`Factor 1: The issue of whether the Workman patent anticipates the ’520
`
`patent is identical in both the district course case and here. While ION’s other
`
`anticipation and obviousness arguments in this IPR are not identical to those
`
`asserted in the district court case, they rely on substantially similar prior art
`
`references.
`
`
`
`Factor 2: The issue was actually litigated at the district court. See Ex. 2003
`
`at 3; see also SAP Am. , Inc.v. Versata Dev. Grp., CBM2012-00001, Paper 36 at
`
`18 (Jan. 9, 2013) (“For a judgment to be ‘final’ for purposes of preclusion before
`
`the Board, the decision need to be immune, as a practical matter, to reversal or
`
`amendment.”).
`
`
`
`Factor 3: The question of whether the Workman patent anticipated the ’520
`
`patent was essential to determining the validity of the ’520 patent in the district
`
`court litigation. See Ex. 2003 at 3.
`
`
`
`Factor 4: ION raised invalidity in a declaratory judgment counterclaim and,
`
`therefore, had a full and fair opportunity to litigate this issue at the district court.
`
`
`
`
`
`
`9
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`Should joinder be granted, Patent Owner will show that the facts here satisfy
`
`
`
`each factor, and although the Restatement provides exceptions, they simply do not
`
`apply.
`
`These new legal issues of collateral estoppel and res judicata would require
`
`additional briefing, and needlessly complicate and delay the ’689 IPR, resulting in
`
`prejudice to the Patent Owner. This briefing would cause almost a complete
`
`rewrite of the current trial schedule, likely delaying the ’689 IPR to beyond the
`
`one-year statutory mandate. Because these substantive new legal issues are not
`
`present in the ’689 IPR, joinder should be denied. See Unified Patents, Inc. v.
`
`Personal Web Techs, LLC et al., Case IPR2014-00702, Paper 12 at 5-6 (July 24,
`
`2014) (finding that substantive new issues weighed in favor of denying the motion
`
`for joinder).
`
`ION’s IPR Raises Issues Regarding Real Party in Interest
`
`C.
`ION’s filing of this joinder motion raises serious RPII issues that Patent
`
`
`
`Owner will pursue should joinder be granted. ION and PGS have previously
`
`coordinated efforts to attack the validity of the ’520 patent and this attempt to seek
`
`joinder is simply another such effort. See Patent Owner Prelim. Resp., ’689 IPR,
`
`Paper 28 at 12-15. For example, ION abandoned its validity appeal as soon as
`
`PGS filed its petition in the ’689 IPR, and admits that many of PGS’ exhibits came
`
`from ION’s district court litigation. Mot. for Joinder, Paper 4 at 9-10. Patent
`
`
`
`
`
`
`10
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`Owner intends to seek additional discovery on the issue of RPII.
`
`Joinder Will Not Ensure a Just, Speedy, and Inexpensive Trial
`
`D.
`The ’689 IPR is already in its advanced stages, making joinder difficult, if
`
`not impossible, to ensure the just, speedy, and inexpensive resolution of the ’689
`
`IPR. After expending extensive efforts to coordinate PGS’ experts’ travel for
`
`depositions in the ’689 IPR as well as the other two related IPRs (IPR2014-00687
`
`and IPR2014-00688), with one expert traveling from Australia, Patent Owner has
`
`finished deposing PGS’ two experts in all three IPRs. ION did not participate in
`
`any of these depositions. The ’689 IPR trial has thus already advanced too far
`
`down the road, and there is simply not sufficient time in the schedule for ION to
`
`catch up.
`
`Moreover, ION seeks to complicate trial further by filing its own papers if
`
`joinder were granted. See Mot. for Joinder, Paper 4 at 9 (noting that ION would
`
`only “entertain” consolidated filings if joinder were granted). This prejudices
`
`Patent Owner by having to respond to two sets of briefs on each issue.
`
`Even if ION agreed to consolidated briefing, Patent Owner is still prejudiced
`
`by ION’s joinder. Patent Owner’s responses in the ’689 IPR as well as the other
`
`related IPRs are due in only a few weeks, long before any decision on joinder will
`
`be made in this case. ION therefore would be joined after Patent Owner files its
`
`responses and possibly even after Patent Owner’s declarants are deposed. This
`
`
`
`
`
`
`11
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`slows trial and prejudices Patent Owner because Patent Owner will then need to
`
`prepare a second set of responses addressing the new issues that ION’s joinder
`
`raises, which may require additional discovery.
`
`E.
`
`ION’S Petition Attempts to Add New Claims and Grounds to the
`’689 IPR
`
`This IPR challenges claims 1, 2, 6, 18, 19, and 23 of the ’520 patent based
`
`on the following six grounds, two of which this Board already rejected:
`
`1) Claims 1 and 18 are anticipated under § 102(b) by Workman;
`
`2) Claims 1, 2, 18, and 19 are obvious under § 103 based on Workman;
`
`3) Claims 1, 2, 18, and 19 are anticipated under § 102(b) by Hedberg;
`
`4) Claims 1, 2, 18, and 19 are obvious under § 103 based on Hedberg;
`
`5) Claims 1, 6, 18, and 23 are obvious under § 103 based on the ’636 PCT
`
`in view of the ’153 PCT.
`
`6) Claims 1, 6, 18, and 23 are obvious under § 103 based on the ’636 PCT
`
`in view of Dolengowski.
`
`In the ’689 IPR, the Board previously denied instituting trial on grounds 5
`
`and 6. The Board also denied instituting trial on claims 6 and 23. ION’s inclusion
`
`of these claims and grounds is simply an improper attempt to have the Board
`
`reconsider the arguments it previously rejected. See 35 U.S.C. § 325(d).
`
`The Preliminary Response Due Date Should Not Be Moved
`
`F.
`ION’s request to shorten Patent Owner’s preliminary response due date
`
`
`
`
`
`
`12
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`should be denied. Patent Owner’s preliminary response is currently due only nine
`
`weeks from now. Patent Owner will need all of that time to seek additional
`
`discovery from ION on RPII–including documents and a deposition–as well as to
`
`brief the additional grounds relating to collateral estoppel and res judicata.
`
`Accordingly, the Board should deny ION’s request for an expedited preliminary
`
`response due date. Patent Owner’s preliminary response is due on May 4, 2015
`
`because of ION’s last-day joinder motion and that date should hold firm so that
`
`Patent Owner has ample time for briefing. Any shortened period would only serve
`
`to prejudice the Patent Owner.
`
`ION is Not Prejudiced
`
`G.
`ION’s claims of prejudice if joinder were denied ring hollow. It is ION that
`
`chose to abandon its validity-related appeal to the Federal Circuit. ION’s risky
`
`abandonment of its only guaranteed validity review is its fault, and such a tactical
`
`mistake should not be used to sway this Board to granting joinder. ION made its
`
`choice and now needs to live with it.
`
`III. CONCLUSION
`ION has not met its burden of showing that joinder is warranted. Joinder
`
`would introduce the substantial new issues of collateral estoppel, res judicata, and
`
`RPII to the ’689 IPR, which is already in an advanced stage. The briefing and
`
`additional discovery required to address these issues would complicate the ’689
`
`
`
`
`
`
`13
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`IPR proceeding and significantly delay the resolution of the ’689 IPR.
`
`Accordingly, Patent Owner respectfully requests that Petitioner’s Motion for
`
`Joinder be denied.
`
`
`
`
`
`
`Dated: February 27, 2015
`
`
`
`
`
`Customer Number
` 22850
`Tel. (703) 413-3000
`Fax. (703) 413-2220
`
`
`
`
`Respectfully submitted,
`
`OBLON LLP
`
`
`
`/Michael L. Kiklis/
`Michael L. Kiklis
`Reg. No. 38,939
`
`Counsel for WesternGeco LLC
`
`
`
`
`
`
`
`
`14
`
`
`
`Patent Owner’s Opposition to Motion for Joinder
`Case IPR2015-00565
`
`CERTIFICATE OF SERVICE
`
`
`
`Pursuant to 37 C.F.R. § 42.6(e), the undersigned certifies service of
`
`PATENT OWNER WESTERNGECO LLC’S OPPOSITION TO PETITIONERS’
`
`MOTION FOR JOINDER on the counsel of record for the Petitioner by filing this
`
`document through the Patent Review Processing System as well as delivering a
`
`copy via electronic mail to the following address:
`
`W. Karl Renner
`Roberto Devoto
`3200 RBC Plaza
`60 South Sixth Street
`Minneapolis, MN 55402
`IPR37136-0004IP1@fr.com
`
`
`
`
`/Michael L. Kiklis/
`Michael L. Kiklis
`Reg. No. 38,939
`
`
`
`
`
`Dated: February 27, 2015
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`15
`
`
Accessing this document will incur an additional charge of $.
After purchase, you can access this document again without charge.
Accept $ Charge
Still Working On It
This document is taking longer than usual to download. This can happen if we need to contact the court directly to obtain the document and their servers are running slowly.
Give it another minute or two to complete, and then try the refresh button.
A few More Minutes ... Still Working
It can take up to 5 minutes for us to download a document if the court servers are running slowly.
Thank you for your continued patience.
This document could not be displayed.
We could not find this document within its docket. Please go back to the docket page and check the link. If that does not work, go back to the docket and refresh it to pull the newest information.
Your account does not support viewing this document.
You need a Paid Account to view this document. Click here to change your account type.
Your account does not support viewing this document.
Set your membership
status to view this document.
With a Docket Alarm membership, you'll
get a whole lot more, including:
- Up-to-date information for this case.
- Email alerts whenever there is an update.
- Full text search for other cases.
- Get email alerts whenever a new case matches your search.
One Moment Please
The filing “” is large (MB) and is being downloaded.
Please refresh this page in a few minutes to see if the filing has been downloaded. The filing will also be emailed to you when the download completes.
Your document is on its way!
If you do not receive the document in five minutes, contact support at support@docketalarm.com.
Sealed Document
We are unable to display this document, it may be under a court ordered seal.
If you have proper credentials to access the file, you may proceed directly to the court's system using your government issued username and password.
Access Government Site
