`_______________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`PALO ALTO NETWORKS, INC.,
`Petitioner,
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`v.
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`FINJAN, INC.,
`Patent Owner.
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`_______________
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`Patent No. 8,141,154 B2
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`_______________
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`Inter Partes Review No. IPR2016-00151
`____________________________________________________________
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`PETITIONER PALO ALTO NETWORKS, INC.’S BRIEF ON ESTOPPEL
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`IPR2016-00151
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`Docket No. 719712801200
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`Petitioner Palo Alto Network (“PAN”) hereby submits this brief in response
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`to the Board’s October 20, 2016 Order (Paper 24) requesting supplemental briefing
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`on the potential impact of estoppel under 35 U.S.C. § 315(e)(1) on this proceeding
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`in view of the earlier due date for a final written decision in IPR2015-01979.
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`If the Board issues a final decision in IPR2015-01979 prior to issuing a final
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`decision in this case, no estoppel should apply. At the time of the first final
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`decision, PAN’s role in the proceedings will have been completed, and thus PAN
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`would not be taking further action “maintaining” this proceeding. Under its plain
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`language, the provisions of § 315(e)(1) would therefore not be applicable.
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`Alternatively, to the extent that the Board determines there is an estoppel, the
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`Board can and should proceed to render a final written decision in this case,
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`furthering the PTAB’s policy goal of maintaining judicial economy. Finally, the
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`Board in its discretion could issue a final decision on both IPR proceedings on the
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`same day, so as to avoid the estoppel issue altogether.
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`I.
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`ARGUMENT
`A.
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`PAN Should Not Be Estopped Under 35 U.S.C. § 315(e)(1)
`Because It Would Not Be “Maintain[ing] a Proceeding Before the
`Office”
`Estoppel attaches only when an inter partes review reaches a final written
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`decision. 35 U.S.C. § 315(e)(1). Thus, no estoppel effect could be triggered until
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`the final written decision in Case IPR2015-01979, due by March 21, 2017, issues.
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`The estoppel provisions restrict a Petitioner from performing only two
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`actions with respect to inter partes reviews: (1) requesting a proceeding, and (2)
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`maintaining a proceeding on grounds that were raised or could have been raised in
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`a prior petition for which a final written decision has been issued. A plain reading
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`of the phrase “maintain a proceeding” means that the Petitioner must be actively
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`participating in the proceedings in order for the estoppel provision to apply. The
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`statute doesn’t state that a party cannot “remain a party to a proceeding.” It instead
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`estops a Petitioner from performing actions that maintain the proceeding. Thus, a
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`Petitioner cannot be said to be “maintaining” a proceeding where the evidentiary
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`record has closed, the oral hearing has concluded, and the proceeding is simply
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`awaiting the Board’s decision.
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`Given the current schedule, as of March 2017, when a final decision in
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`IPR2015-01979 is due, the final hearing in this proceeding will have been
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`completed approximately two months earlier, as it is currently set for January 24.
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`Thus, if the PTAB issues a final decision in IPR2015-01979 in March 2017, the
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`record will be complete, oral argument completed, and by that point PAN will need
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`to take no additional action in this proceeding.
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`Here, by the time IPR2015-01979 reaches a final written decision, PAN’s
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`role in the proceedings will have come to an end and the trial will have been
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`completed. See CBS Interactive Inc. v. Helferich Patent Licensing, LLC, IPR2013-
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`00033, Paper 118 at 2-3 (Oct. 23, 2013) (holding that by time proceeding reaches
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`final oral hearing, trial is complete). All that would remain is for the Board to
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`issue a final written decision. Indeed, by that point, as discussed below, the Board
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`may even continue the proceeding without any Petitioners. Petitioners cannot be
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`said to be “maintain[ing]” the proceeding if the proceeding can continue without it.
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`The issue of what action constitutes “maintaining a proceeding” has been
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`previously considered by other panels. In Apple Inc. v. Smarthflash LLC,
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`CBM2015-00015, Paper 49 at 4-5 (Nov. 4, 2015), although the evidentiary record
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`had closed, the oral hearing had not yet occurred. There, the Board found that
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`‘maintain[ing] a proceeding’ includes presenting argument at the hearing.” Id. at
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`5. Here, by contrast, the oral hearing, scheduled for January 24, 2017, will have
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`already concluded. By the time a Final Written decision is issued in IPR2015-
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`01979, there will be no further participation required of PAN in this proceeding—
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`“presenting argument at the hearing” or otherwise. Thus, because there will be
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`nothing more for PAN to do, PAN would not be “maintain[ing]” the proceeding
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`and should thus not be estopped under Section 315(e)(1).
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`B.
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`The Board Should Proceed to a Final Written Decision Even If
`PAN Is Estopped from This Proceeding
`1. Without PAN, the Petition Lives On Because Symantec
`Remains a Petitioner in This Proceeding
`The Board has discretion to terminate an inter partes review only “[i]f no
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`Petitioner remains in the inter partes review.” 35 U.S.C. § 317(a). Here, PAN is
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`not the sole Petitioner. On May 19, 2016, Symantec filed a petition requesting
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`inter partes review of the same claims of U.S. Patent No. 8,141,154 and
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`concurrently filed a motion for joinder to join this proceeding. Symantec Corp. v.
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`Finjan, Inc., IPR2016-01071, Paper 1 and 3 (May 19, 2016). On
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`September 8, 2016, the Board granted that request.
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`The reasons set forth above for why Palo Alto Networks should not be
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`estopped are equally applicable to Symantec. Symantec should not be estopped for
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`one additional reason, that Symantec could not have raised the Ross-based grounds
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`upon which trial was instituted in this proceeding in its petition in case no.
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`IPR2016-00919 (which was subsequently joined to IPR2015-01979, see IPR2016-
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`00919, Paper No. 10). Specifically, Symantec filed its petition in IPR2016-00919
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`more than one year after Finjan filed a complaint asserting the ‘154 patent against
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`Symantec. Accordingly, absent joinder to another instituted petition, Symantec’s
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`petition in IPR2016-00919 would have been time barred. However, if Symantec
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`had attempted to raise grounds not raised in IPR2015-01979 in its petition in
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`IPR2016-00919 (like the Ross-based grounds instituted in this proceeding),
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`Symantec’s motion for joinder in IPR2016-00919 would have been denied, and
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`Symantec’s petition in IPR2016-00919 would have then been denied as time-
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`barred pursuant to Section 315(b). See Harmonix Music Systems, Inc. v. Princeton
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`Digital Image Corp., IPR2015-00271, Paper 15 at 4 (“the Petition includes a new
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`challenge to both a claim not instituted in the ’635 IPR, claim 14, and claims
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`instituted in the ’635 IPR, claims 5–7 and 16–18, based on a new combination of
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`references considered in the ’635 IPR”); id. at 11 (denying motion for joinder);
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`Harmonix Music Systems, Inc. v. Princeton Digital Image Corp., IPR2015-00271,
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`Paper 14 at 8 (denying institution because the Board “denie[d] the Motion for
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`Joinder”); IPR2016-00919, Paper No. 10 (in granting Symantec’s motion for
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`joinder, noting that “[t]he Petition here is substantially identical to the Petition in
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`the PAN IPR”). Accordingly, because Symantec could not have raised the Ross-
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`based grounds upon which this proceeding were instituted in the IPR2015-
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`01979/IPR2016-00919 proceeding, Symantec should not be estopped from
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`maintaining this proceeding.
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`2.
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`The Board Has the Authority to Proceed to a Final Written
`Decision Without Any Petitioners
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`Even if the Board were to determine that an estoppel applied, the Board
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`retains the authority to continue to a final written decision. Section 315(e)(1)
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`defines limitations on the actions of the Petitioner (or its real party in interest or
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`privy): “[t]he Petitioner in an inter partes review . . . may not request or maintain
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`a proceeding before the Office.” 35 U.S.C. § 315(e)(1) (emphasis added). The
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`statute, however, does not proscribe actions that the Board may take. Apple Inc. v.
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`Smartflash LLC, CBM2015-00015, Paper 49 at 5 (Nov. 4, 2015). Indeed, the
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`Federal Circuit has so confirmed. In Progressive Casualty Insurance Co. v.
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`Liberty Mutual Insurance Co., the Federal Circuit held that 35 U.S.C. § 325(e)(1),
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`an analogous estoppel statute for covered business method patent reviews, “by its
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`terms does not prohibit the Board from reaching decisions. It limits only certain
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`(requesting or maintaining) actions by a Petitioner.” No. 2014-1466, 2015 WL
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`5004949, at *2 (Fed. Cir. Aug. 24, 2015). Accordingly, Section 315(e)(1) likewise
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`does not prohibit the Board from reaching a final written decision. The Board is
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`thus free to reach the merits and issue a final written decision in this proceeding,
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`even if PAN were dismissed from the case.
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`Indeed, neither the statute nor the Board rules mandate the Board to
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`terminate an IPR trial when no Petitioner remains as a result of estoppel. To the
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`contrary, the Board remains authorized to “proceed to a final written decision
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`under section 318(a),” even “[i]f no Petitioner remains in the inter partes review.”
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`35 U.S.C. § 317(a); see also 37 C.F.R. § 42.74. The Federal Circuit has also
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`indicated that the Board is free to reach the merits and issue a final written decision
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`when no Petitioner remains, either as a result of settlement or estoppel.
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`No. 2014-1466, 2015 WL 5004949, at *2 (discussing “Board authority to enter a
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`decision” “even after Petitioner settles and drops out of the proceeding”). Various
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`panels of the Board have done just so and proceeded to reach the merits and issue a
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`final written decision when no Petitioner remained as a result of settlement.
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`BlackBerry Corp. v. MobileMedia Ideas LLC, IPR2013-00016, Paper 31
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`(Dec. 11, 2013); InterThinx, Inc. v. CoreLogic Solutions, LLC, CBM2012-00007,
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`Paper 47 (Nov. 12, 2013).
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`Judicial economy favors reaching the merits and issuing a final written
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`decision in this case. By the time Section 315(e)(1) could apply, the evidentiary
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`record will be complete, and significant will have already been done by the Board
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`and the parties. In view of the fully developed record, the resources expended, and
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`the district court case stayed in reliance on this proceeding, there is a strong public
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`interest in resolving the issues raised by this IPR. Yahoo! Inc. v. CreateAds LLC,
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`IPR2014-00200, Pap. 40 at 2 (Feb. 26, 2015). Indeed, in similarly postured cases,
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`the Board has issued a final written decision even when no Petitioner remained, in
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`light of the advanced stage of the proceeding and especially where “trial issues had
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`been briefed fully.” BlackBerry Corp., IPR2013-00016, Paper 31 at 3; also Inter-
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`thinx, Inc., CBM2012-00007, Paper 47 at 2-3; cf. also Google Inc. v. Unwired
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`Planet, LLC, IPR2014-00037, Paper 20 at 2-3 (June 12, 2014).
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`3.
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`Alternatively, the Board Should Exercise Its Discretion to
`Avoid the Estoppel Effect of Section 315(e)(1) by Issuing
`Both Final Written Decisions on the Same Date
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`Finally, given that the final written decisions in IPR2015-01979 and this
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`proceeding are due to be issued approximately one month from each other, the
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`Board could opt to issue its final decision in both cases concurrently, thus avoiding
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`the potential estoppel issue. If the Board were to issue both final decisions on the
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`same date on or before March 27, 2017, for example, no estoppel issue would
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`exist. Alternatively, the Board has the discretion to modify the schedule to permit
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`both decisions to issue on the same date after March 27. See 37 C.F.R. § 42.100(c)
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`(giving Board discretion to change deadline for final written decision by six
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`months). If the Board determines that an earlier oral argument in this case would
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`assist it in any way, PAN is fully willing to agree to such an adjustment.
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`II. CONCLUSION
`For the foregoing reasons, the Board should find that PAN is not estopped
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`under 35 U.S.C. § 315(e)(1). Even if the Board determines that an estoppel
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`applies, the Board should not terminate this proceeding. Rather, the Board should
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`reach the merits and issue a final written decision, in view of the fact that the
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`record will have been fully developed and the oral hearing concluded.
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`Alternatively, the Board can exercise its discretion to issue its decisions in both
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`IPR proceedings concurrently, avoiding the estoppel issue entirely.
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`Docket No. 719712801200
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`Respectfully submitted,
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`By: /s/ Matthew I. Kreeger
`Matthew I. Kreeger
` Registration No.: 56,398
`MORRISON & FOERSTER LLP
`425 Market Street
`San Francisco, CA 94105
`Tel: (415) 268-6467
`Attorney for Petitioner
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`Dated: November 15, 2016
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`CERTIFICATE OF SERVICE (37 C.F.R. § 42.6(e)(4))
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`I hereby certify that a copy of the foregoing Petitioner Palo Alto Networks,
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`Inc.’s Brief on Estoppel was served as of the below date on Patent Owner via e-
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`mail (by agreement) to the following counsel of record for Patent Owner:
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`James Hannah
`KRAMER LEVIN NAFTALIS &
`FRANKEL LLP
`990 Marsh Road
`Menlo Park, CA 94025
`Phone: (650) 752-1712
`Fax: (650) 752-1812
`jhannah@kramerlevin.com
`jprice@kramerlevin.com
`svdocketing@kramerlevin.com
`mkim@finjan.com
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`PETITIONER’S COUNSEL OF RECORD IN IPR2016-01071:
`Nathaniel A. Hamstra (Lead Counsel)
`nathanhamstra@quinnemanuel.com
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`PETITIONER'S COUNSEL OF RECORD IN IPR2015-01979:
`Orion Armon
`Christopher Max Colice
`Jennifer Volk
`Brian Eutermoser
`COOLEYLLP
`oarmon@cooley.com
`mcolice@cooley.com
`jvolkfortier@cooley.com
`beutermoser@cooley.com
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`Dated: November 15, 2016
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` /s/ Kim Helenius
` Kim Helenius
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