UNITED STATES PATENT AND TRADEMARK OFFICE
`
`___________________________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`___________________________________
`
`NU MARK LLC,
`Petitioner,
`
`v.
`
`FONTEM HOLDINGS 1 B.V.,
`Patent Owner.
`
`___________________________________
`
`
`
`Case IPR2016-01303
`Patent 8,365,742
`
`___________________________________
`
`
`
`JOINT MOTION TO TERMINATE
`PURSUANT TO 35 U.S.C. § 317
`
`
`
`
`
`
`
`111971-0004.2001/133955057.1
`
`
`
`___________________________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`___________________________________
`
`NU MARK LLC,
`Petitioner,
`
`v.
`
`FONTEM HOLDINGS 1 B.V.,
`Patent Owner.
`
`___________________________________
`
`
`
`Case IPR2016-01303
`Patent 8,365,742
`
`___________________________________
`
`
`
`JOINT MOTION TO TERMINATE
`PURSUANT TO 35 U.S.C. § 317
`
`
`
`
`
`
`
`111971-0004.2001/133955057.1
`
`
`
`IPR2016-01303
`U.S. Patent No. 8,365,742
`Pursuant to 35 U.S.C. § 317(a) and 37 C.F.R. § 42.74, Petitioner Nu Mark
`
`LLC (“Nu Mark”) and Patent Owner Fontem Holdings 1 B.V. (“Patent Owner”)
`
`jointly move the Patent Trial and Appeal Board (“Board”) to terminate the
`
`IPR2016-01303 proceeding.1
`
`On December 27, 2016, Patent Owner and Petitioner Nu Mark notified the
`
`Board that they reached a settlement agreement resolving all disputes between
`
`them involving the patent-at-issue in the IPR2016-01303 proceeding, and further
`
`requested guidance and permission to file a motion to terminate the IPR2016-
`
`01303 proceeding. There are no other agreements, oral or written, between Patent
`
`Owner and Petitioner Nu Mark made in connection with, or in contemplation of,
`
`the termination of the IPR2016-01303 proceeding. On December 29, 2016, the
`
`Board authorized Patent Owner and Petitioner Nu Mark to file a joint motion to
`
`terminate and a joint request to treat the settlement agreement as business confi-
`
`dential.
`
`Pursuant to 35 U.S.C. § 317(b) and 37 C.F.R. § 42.74(b), a true copy (in-
`
`cluding counterparts) of the settlement agreement is filed herewith. Because the
`
`settlement agreement is confidential, Patent Owner and Petitioner Nu Mark re-
`
`spectfully request that it be treated as business confidential information and kept
`
`
`The Board has not yet issued a decision as to whether trial will be instituted;
`1
`therefore, the IPR2016-01303 proceeding is still in its preliminary proceeding
`stage. 37 C.F.R. § 42.2.
`
`111971-0004.2001/133955057.1
`
`1
`
`
`
`IPR2016-01303
`U.S. Patent No. 8,365,742
`separate from the underlying patent file, as provided in 35 U.S.C. § 317(b) and 37
`
`C.F.R. § 42.74(c).
`
`As stated in 35 U.S.C. § 317(a), because Petitioner Nu Mark and Patent
`
`Owner are jointly requesting termination of the IPR2016-01303 proceeding, no es-
`
`toppel under 35 U.S.C. § 315(e) shall attach to Petitioner Nu Mark.
`
`I.
`
`TERMINATION OF THE INTER PARTES REVIEW PROCEEDING
`IS APPROPRIATE
`
`An inter partes review (IPR) “shall be terminated with respect to any peti-
`
`tioner upon the joint request of the petitioner and the patent owner, unless the Of-
`
`fice has decided the merits of the proceeding before the request for termination is
`
`filed.” 35 U.S.C. § 317(a). “If no petitioner remains in the inter partes review, the
`
`Office may terminate the review or proceed to a final written decision under sec-
`
`tion 318(a).” Id.
`
`There is an expectation that an IPR will be terminated after the filing of a
`
`settlement agreement because “[t]here are strong public policy reasons to favor set-
`
`tlement between the parties to a proceeding. . . .” Office Patent Trial Practice
`
`Guide, 77 Fed. Reg. 48,756, 48,768 (Aug. 14, 2012) (“The Board expects that a
`
`proceeding will terminate after the filing of a settlement agreement, unless the
`
`Board has already decided the merits of the proceeding.”). The expectation of ter-
`
`mination in connection with settlement is due to the adjudicatory nature of IPR
`
`proceedings, as contrasted with the examinational nature of the inter partes reex-
`
`111971-0004.2001/133955057.1
`
`2
`
`
`
`IPR2016-01303
`U.S. Patent No. 8,365,742
`amination proceedings they replaced. See, e.g., Idle Free Systems Inc. v. Berg-
`
`strom Inc., IPR2012-00027, Paper 26 at 6 (June 11, 2013) (“An inter partes review
`
`is more adjudicatory than examinational, in nature.”); Abbott Labs v. Cordis Corp.,
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`710 F.3d 1318, 1326 (Fed. Cir. 2013) (“In 2011, Congress replaced inter partes
`
`reexamination with a new proceeding called inter partes review.… The purpose of
`
`this reform was to ‘convert[] inter partes reexamination from an examinational to
`
`an adjudicative proceeding,’ ….”) (citations omitted).
`
`Here, the IPR2016-01303 proceeding should be terminated in its entirety be-
`
`cause of the strong public policy and expectation that IPRs will terminate upon set-
`
`tlement prior to a decision on the merits. The IPR2016-01303 proceeding is still in
`
`its preliminary stage as the Board has not yet issued a decision as to whether a trial
`
`will be instituted. As such, termination would save significant further expenditures
`
`of resources by the Board and the parties.
`
`The IPR2016-01303 proceeding should also be terminated because the par-
`
`ties jointly request termination. Patent Owner and Petitioner Nu Mark have re-
`
`solved the IPR2016-01303 proceeding and related litigation through settlement.
`
`Termination of the IPR2016-01303 proceeding in view of settlement also
`
`provides a measure of certainty as to the outcome, promoting settlements and cre-
`
`ating a timely, cost-effective alternative to litigation. And such termination is con-
`
`sistent with the adjudicatory nature of IPRs. Once termination is effected, there
`
`111971-0004.2001/133955057.1
`
`3
`
`
`
`IPR2016-01303
`U.S. Patent No. 8,365,742
`will be no counter-party in this proceeding and no need for an adjudicatory pro-
`
`ceeding.
`
`For at least those reasons discussed above, Patent Owner and Petitioner Nu
`
`Mark respectfully request that the Board terminate the IPR2016-01303 proceeding.
`
`II. MATTERS RELATED TO THE INTER PARTES REVIEW PRO-
`CEEDING
`
`The patent-at-issue in the IPR2016-01303 proceeding is the subject of sever-
`
`al federal district court litigations. There are two other petitions for IPR of the pa-
`
`tent-at-issue. See IPR2016-01268 and IPR2016-01532. The settlement agreement
`
`has resolved all disputes involving the patent-at-issue between Patent Owner and
`
`Petitioner Nu Mark.
`
`A. Case No. 1:16-CV-01261 (M.D.N.C.) Relates to the Inter Partes
`Review Proceeding
`
`Patent Owner filed two patent infringement suits against Petitioner Nu Mark
`
`in the United States District Court for the Central District of California (Fontem
`
`Ventures BV et al. v. Nu Mark LLC, Case No. 2:16-cv-02291 and Fontem Ventures
`
`BV et al. v. Nu Mark LLC, Case No. 2:16-cv-04537). Those cases were transferred
`
`to the Middle District of North Carolina (Fontem Ventures BV et al. v. Nu Mark
`
`LLC, Case No. 1:16-cv-01261 and Fontem Ventures BV et al. v. Nu Mark LLC,
`
`Case No. 1:16-cv-01259, respectively). In Case No. 1:16-cv-01261, Patent Owner
`
`accused Petitioner Nu Mark of infringing the patent-at-issue in addition to seven
`
`111971-0004.2001/133955057.1
`
`4
`
`
`
`IPR2016-01303
`U.S. Patent No. 8,365,742
`other patents. In Case No. 1:16-cv-01259, Patent Owner accused Petitioner Nu
`
`Mark of infringing eight other patents. Patent Owner Fontem Holdings 1 B.V.,
`
`Fontem Ventures B.V., and Petitioner Nu Mark are the parties to those litigations,
`
`which were consolidated. As a result, a total of sixteen patents have been asserted
`
`against Nu Mark in the consolidated action (Case No. 1:16-cv-01261). Those liti-
`
`gations are covered by Patent Owner and Petitioner Nu Mark’s settlement agree-
`
`ment.
`
`B. Case No. 1:16-cv-01255 (M.D.N.C.) Relates to the Inter Partes Re-
`view Proceeding
`
`Patent Owner also filed a patent infringement suit against another entity as-
`
`serting the patent-at-issue in the United States District Court for the Central Dis-
`
`trict of California, captioned Fontem Ventures BV et al. v. R.J. Reynolds Vapor
`
`Company, Case No. 2:16-cv-02286. That case was transferred to the Middle Dis-
`
`trict of North Carolina and is captioned Fontem Ventures BV et al. v. Nu Mark
`
`LLC, Case No. 1:16-cv-01255. Patent Owner Fontem Holdings 1 B.V., Fontem
`
`Ventures B.V., and R.J. Reynolds Vapor Company are the parties to that litigation,
`
`which is currently pending.
`
`C. Additional Cases Relate to the Inter Partes Review Proceeding
`
`Patent Owner also filed patent infringement suits against other entities as-
`
`serting the patent-at-issue in the United States District Court for the Central Dis-
`
`trict of California, captioned Fontem Ventures BV et al. v. Logic Technology De-
`
`111971-0004.2001/133955057.1
`
`5
`
`
`
`IPR2016-01303
`U.S. Patent No. 8,365,742
`velopment LLC, Case No. 2-14-cv-01654; Fontem Ventures BV et al. v. LOEC, Inc.
`
`et al., Case No. 2-14-cv-01648; Fontem Ventures B.V. et al. v. NJOY, Inc., Case
`
`No. 2:14-cv-01645; Fontem Ventures BV et al. v. Ballantyne Brands, LLC, Case
`
`No. 2-14-cv-01652; Fontem Ventures BV et al. v. CB Distributors, Inc. et al., Case
`
`No. 2-14-cv-01649; Fontem Ventures BV et al. v. Spark Industries, LLC, Case No.
`
`2-14-cv-01653; Fontem Ventures BV et al. v. Vapor Corp., Case No. 2-14-cv-
`
`01650; Fontem Ventures BV et al. v. VMR Products, LLC, Case No. 2-14-cv-
`
`01655; Fontem Ventures BV et al. v. FIN Branding Group, LLC et al., Case No. 2-
`
`14-cv-01651. Those cases have all been settled and dismissed.
`
`D. Board Proceedings
`
`As mentioned above, there are two other petitions for IPR of the patent-at-
`
`issue. On July 2, 2016, Petitioner R.J. Reynolds Vapor Company filed IPR2016-
`
`01268 against the patent-at-issue, and on August 5, 2016, Petitioner R.J. Reynolds
`
`Vapor Company filed IPR2016-01532 against the patent-at-issue. Patent Owner
`
`Fontem Holdings 1 B.V. and R.J. Reynolds Vapor Company are the parties to
`
`those proceedings. The Board has not yet issued a decision as to whether a trial
`
`will be instituted for those IPRs.
`
`III. CONCLUSION
`
`Patent Owner and Petitioner Nu Mark respectfully request that the Board
`
`grant the parties’ joint motion to terminate the IPR2016-01303 proceeding in its
`
`111971-0004.2001/133955057.1
`
`6
`
`
`
`IPR2016-01303
`U.S. Patent No. 8,365,742
`entirety and grant the accompanying request to treat the settlement agreement be-
`
`tween Patent Owner and Petitioner Nu Mark as business confidential information.
`
`Patent Owner and Petitioner Nu Mark are available at the Board’s conven-
`
`ience to discuss these related matters in more detail or answer any additional ques-
`
`tions raised by this joint motion.
`
`
`
`
`
`
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`
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`
`
`January 3, 2017
`
`Respectfully submitted,
`
`By: /Michael J. Wise/ _______
`Michael J. Wise
`Reg. No. 34,047
`PERKINS COIE LLP
`1888 Century Park East, Suite 1700
`Los Angeles, CA 90067
`Phone: 310-788-3210
`Facsimile: 310-788-3399
`MWise@PerkinsCoie.com
`
`By: /Elizabeth S. Weiswasser/
`Elizabeth S. Weiswasser
`Reg. No. 55,721
`WEIL, GOTSHAL & MANGES LLP
`767 Fifth Avenue
`New York, NY 10153-0119
`Phone: 212-310-8022
`Facsimile: 212-310-8007
`elizabeth.weiswasser@weil.com
`
`
`
`Lead Counsel for Petitioner
`
`
`
`
`Lead Counsel for Patent Owner
`
`
`
`111971-0004.2001/133955057.1
`
`7
`
`
`
`CERTIFICATE OF SERVICE
`
`The undersigned hereby certifies that a copy of the following document has
`
`
`
`been served in its entirety by filing the JOINT MOTION TO TERMINATE PUR-
`
`SUANT TO 35 U.S.C. § 317 through the Patent Review Processing System, as
`
`well as by causing the aforementioned document to be electronically mailed, pur-
`
`suant to the parties’ agreement, to the following attorneys of record for Petitioner
`
`listed below:
`
`
`
`
`
`
`
`
`Elizabeth S. Weiswasser, Lead Counsel
`Adrian C. Percer, Backup Counsel
`Jeremy Jason Lang, Backup Counsel
`Brian C. Chang, Backup Counsel
`Anish R. Desai, Backup Counsel
`Weil, Gotshal & Manges LLP
`elizabeth.weiswasser@weil.com
`adrian.percer@weil.com
`jason.lang@weil.com
`brian.chang@weil.com
`anish.desai@weil.com
`
`
`Dated:
`
`
`
`
`
`January 3, 2017
`
`
`
`
`
`
`
`/Amy Candeloro/
`Paralegal
`PERKINS COIE LLP
`
`
`
`
`
`111971-0004.2001/133955057.1
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