Paper No. 46
`Filed: December 6, 2018
`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`
`
`ZTE (USA) INC.,
`
`Petitioner
`
`v.
`
`FUNDAMENTAL INNOVATION SYSTEMS INTERNATIONAL LLC,
`
`Patent Owner
`
`
`
`MOTION TO RETROACTIVELY ADD A REAL PARTY IN INTEREST
`OR TERMINATE THIS PROCEEDING
`
`Case No. IPR2018-00111
`Patent 8,624,550 B2
`
`
`
`Before RAE LYNN P. GUEST, JO-ANNE M. KOKOSKI, and
`JON B. TORNQUIST, Administrative Patent Judges
`
`

`

`IPR2018-00111
`Motion To Add Real Party In Interest Retroactively
`
`
`Table of Authorities
`
`Cases
`Applications in Internet Time, LLC v. RPX Corporation
` 897 F.3d 1336 (Fed. Cir. 2018).................................................................... passim
`Aruze Gaming Macau, Ltd. v. MGT Gaming, Inc.
`IPR2014-01288, Paper 13 (P.T.A.B. Feb. 20, 2015) .........................................3, 5
`
`Dep’t of Justice v. IRIS Corp. Berhad
`
`IPR2016-00497, Paper 7 (P.T.A.B. Jul. 25, 2016) ................................................ 4
`Elekta, Inc. v. Varian Med. Sys., Inc.
`
`IPR2015-01401, Paper 19 (P.T.A.B. Dec. 31, 2015) ................................... 10, 11
`GEA Process Eng’g. Inc. v. Steuben Foods, Inc.
`
`IPR2014-00041, Paper 140 (P.T.A.B. Feb. 11, 2015) ........................................... 4
`Gillig v. Nike, Inc.
` 602 F.3d 1354 (Fed. Cir. 2010).............................................................................. 5
`In re Micron Tech., Inc.
` 875 F.3d 1091 (Fed. Cir. 2017)............................................................................ 12
`LG Display Co., Ltd. v. Innovative Display Techs. LLC
`IPR2014-01362, Paper 12 (P.T.A.B. Mar. 2, 2015) .............................................. 5
`
`Lumentum Holdings, Inc. v. Capella Photonics, Inc.
`IPR2015-00739, Paper 38 (P.T.A.B. Mar. 4, 2016) ............................................ 10
`
`Mobile Tech., Inc. v. Sennco Solutions, Inc.
`IPR2017-02199 (P.T.A.B. Apr. 10, 2018) ............................................................. 5
`
`Puzhen Life USA, LLC v. Esip Series 2, LLC
`IPR2017-02197 (P.T.A.B. Apr. 11, 2018) ............................................................. 5
`
`Taylor v. Sturgell
` 553 U.S. 880 (2008) ............................................................................................... 4
`TRW Auto. U.S. LLC v. Magna Elecs. Inc.
`
`IPR2014-01351, Paper 7 (P.T.A.B. Feb. 10, 2015) ............................................... 5
`Wi-Fi One, LLC v. Broadcom Corp.
` 887 F.3d 1329 (Fed. Cir. 2018).............................................................................. 6
`Zerto, Inc. v. EMC Corp.
`
`IPR2014-01254, Paper 32 (P.T.A.B. Feb 12, 2015) .............................................. 4
`Zoll Lifecor Corp. v. Philips Elec.N. Am. Corp.
`IPR2013-00606, Paper 13 (P.T.A.B. Mar. 20, 2014) ............................................ 4
`
`
`
`
`

`

`IPR2018-00111
`Motion To Add Real Party In Interest Retroactively
`
`
`Statutes
`35 U.S.C. §312(a)(2) ................................................................................................ 12
`
`Rules
`37 C.F.R. § 42.1 ....................................................................................................... 15
`37 C.F.R. § 42.72 ................................................................................................ 6, 17
`
`Other Authorities
`Patent and Trademark Office Patent Trial Practice Guide
` 77 Fed. Reg. 48756 (Aug. 14, 2012) ..................................................................4, 6
`Practice Guide for Proposed Trial Rules
` 77 Fed. Reg. 6868 (Feb. 9, 2012) .......................................................................... 4
`Revision of Patent Term Adjustment Provisions Relating to Appellate
`Review
` Fed. Reg. 49,354 (Aug. 16, 2012) ........................................................................ 12
`
`
`
`
`
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`I. Introduction
`Petitioner ZTE (USA) Inc. (“Petitioner”) respectfully requests leave to name
`
`an additional real party in interest (“RPI”) in this proceeding, or to the extent this
`
`request is denied, to seek termination of this proceeding. See Paper 45 (“Order”) at
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`1. For the reasons that follow, Petitioner respectfully requests that the Board enter
`
`the amended mandatory notice submitted herewith and maintain the original filing
`
`date of the instant instituted Petition for Inter Partes Review (“IPR”).
`
`Section 312, 35 U.S.C. requires that “[a] petition [for IPR] may be
`
`considered only if . . . (2) the petition identifies all real parties in interest.” [please
`
`INSERT factual background – want to take care with affirmative statements]
`
`II. Argument
`Amendment of the named RPIs in this proceeding is only necessitated by the
`
`intervening change in law from the July 9, 2018 Federal Circuit decision in
`
`Applications in Internet Time, LLC v. RPX Corporation, 897 F.3d 1336 (Fed. Cir.
`
`2018) (“AIT”). There is no prejudice because Patent Owner has known about the
`
`to-be-named entity, ZTE (TX), Inc. (“ZTE TX”) all along. Retroactive amendment
`
`of the named RPIs in this proceeding would satisfy the two aims of the statutory
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`requirement while protecting the public interest.
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`
`
`1
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`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`
`A. The Intervening Change In Law Merits Retroactive Identification of
`
`ZTE TX As A Real Party In Interest
`
`ZTE TX never contributed to the control or funding of this IPR proceeding,
`
`nor did it make or sell allegedly infringing products (and at most practiced de
`
`minimis test use) and therefore Petitioner did not name ZTE TX as an RPI in the
`
`petition. However, the Federal Circuit’s intervening decision in AIT changes the
`
`law in a way that suggests ZTE TX may be an RPI. Under these circumstances,
`
`petitioners request leave to retroactively identify ZTE TX as an RPI, particularly
`
`where, as here, Patent Owner would suffer no prejudice.
`
`1. The Federal Circuit’s RPX Decision Changed The Law
`
`ZTE (TX), Inc. (“ZTE TX”) is a subsidiary of ZTE Corporation and thus an
`
`affiliate corporation of Petitioner ZTE (USA), Inc. Like ZTE (USA), Inc. and ZTE
`
`Corporation, ZTE TX was sued by Patent Owner in the Eastern District of Texas
`
`Case No. 3:17-cv-01827-N filed July 12, 2017. As an affiliate of Petitioner ZTE
`
`(USA), Inc. ZTE TX does not control or financially influence ZTE (USA), Inc.
`
`Prior to AIT, RPI determination followed common law understanding of
`
`“real party in interest” considerations. Both the Supreme Court case Taylor v.
`
`Strurgell and the USPTO Patent Trial Practice Guide, Fed. Reg. 48,756 (Aug. 14,
`
`2012) (“Trial Practice Guide”) provided guidance to practitioners. According to the
`
`Trial Practice Guide:
`
`
`
`2
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`
`the spirit of that formulation as to IPR and PGR proceedings means
`that, at a general level, the “real party-in-interest” is the party that
`desires review of the patent. Thus, the “real party-in-interest” may be
`the petitioner itself, and/or it may be the real party or parties at whose
`behest the petition has been filed.
`
`
`Id at 48759. The Trial Practice Guide recognized practitioners’ desire for guidance:
`
`The Office has received requests to state whether particular
`facts will qualify a party as a ‘‘real party-in interest’’ or ‘‘privy.’’
`Some fact combinations will generally justify applying the ‘‘real
`party-in-interest’’ or ‘‘privy’’ label. For example, a party that funds
`and directs and controls an IPR or PGR petition or proceeding
`constitutes a ‘‘real party-in-interest,’’ even if that party is not a
`‘‘privy’’ of the petitioner. But whether something less than complete
`funding and control suffices to justify similarly treating the party
`requires consideration of the pertinent facts.
`
`Id. at 48760 (emphasis added). As stated in the Trial Practice Guide, there are
`
`“multiple factors relevant to the question of whether a non-party may be
`
`recognized as” an RPI. Id. (citing Taylor v. Sturgell, 533 U.S. 880, 893–895, 893
`
`n.6 (2008)). “A common consideration is whether the non-party exercised or could
`
`have exercised control over a party’s participation in a proceeding,” however
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`“there is no ‘bright line-test’ for determining the necessary quantity or degree of
`
`participation to qualify as a ‘real party-in-interest’ or ‘privy’1 based on the control
`
`concept.” Trial Practice Guide at 48759 (quoting 18A Charles Alan Wright, Arthur
`
`
`1 “Privy” appears in 35 U.S.C. 315(b) (“An inter partes review may not be
`instituted if the petition requesting the proceeding is filed more than 1 year after
`the date on which the petitioner, real party in interest, or privy of the petitioner is
`served with a complaint alleging infringement of the patent.”) (emphasis added).
`
`
`
`3
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`R. Miller & Edward H. Cooper, Federal Practice & Procedure §§ 4449, 4451 (2d
`
`ed. 2011)). Considerations may include, for example, whether a non-party
`
`exercises control over a petitioner’s participation in a proceeding, or whether a
`
`non-party is funding the proceeding or directing the proceeding. Id. at 48,759–60.
`
`A petition is presumed to identify accurately all RPIs. See Zerto, Inc. v. EMC
`
`Corp., Case IPR2014-01295, slip op. at 6–7 (PTAB Mar. 3, 2015) (Paper 34).
`
`
`
`
`
`The Supreme Court in Taylor v. Sturgell provided a non-exhaustive list for
`
`examining whether the legal relationship between two parties establishes that one
`
`is the privy of the other. The list consists of six categories that create independent
`
`exceptions to the common law rule that normally forbids non-party preclusion in
`
`litigation: (1) an agreement between the parties to be bound; (2) pre-existing
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`substantive legal relationships between the parties; (3) adequate representation by
`
`the named party; (4) the non-party’s control of the prior litigation; (5) where the
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`non-party acts as a proxy for the named party to relitigate the same issues; and (6)
`
`where special statutory schemes foreclose successive litigation by the non-party
`
`(e.g., bankruptcy and probate). Taylor, 553 U.S. at 894–95. The Supreme Court
`
`noted that this list of six categories is meant to provide a “framework” for
`
`considering non-party preclusion, “not to establish a definitive taxonomy.”
`
`
`
`
`
`4
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`
`See Institution Decision at *8, RPX Corp., IPR2015-1750 (P.T.A.B. May 12,
`
`2016) (basing its real party in interest determinations on “whether a non-party
`
`exercises control over a petitioner’s participation in a proceeding, or whether a
`
`non-party is funding the proceeding” (emphases added)).
`
`The USPTO and Board had previously consistently looked to funding and
`
`control in the proceeding, with control as all but determinative. See, e.g., Aruze
`
`Gaming Macau, Ltd. v. MGT Gaming, Inc., IPR2014-01288, Paper 13 at 11-12
`
`(“central” factor to RPI determination is whether “a party other than the named
`
`petitioner was controlling, or capable of controlling, the proceeding before the
`
`Board.”) (quoting Trial Practice Guide, at 48,759 (“it should be enough that the
`
`nonparty has the actual measure of control or opportunity to control that might
`
`reasonably be expected between two formal co-parties.”)). That the degree of
`
`control exercised by a non-party over a party’s participation in the proceeding is a
`
`“common consideration” dated even back to the Practice Guide for Proposed Trial
`
`Rules, 77 Fed. Reg. 6868, 6870 (February 9, 2012) (citing Taylor v. Sturgell, 553
`
`U.S. 880, 895 (2008)). In a 2016 case, the Board stated the “mere participation in
`
`litigation and assumption of liability do not, without more, make a real party in
`
`interest,” and denying RPI status where the challenger failed to provide any
`
`evidence that the party had exercised or could have exercised “control over the
`
`proceeding.” Dep’t of Justice v. IRIS Corp. Berhad, IPR2016-00497, Paper 7 at 7–
`
`
`
`5
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`9 (P.T.A.B. Jul. 25, 2016). The Board also found that co-defendants were not an
`
`RPI or privy absence a specific connection to the petition at issue. See Weatherford
`
`Int’l, LLC v. Packers Plus Energy Servs., Inc., IPR2016-01517, Paper 23 at 11–15
`
`(P.T.A.B. Feb. 23, 2017); Denso Corp. v. Beacon Navigation GmbH, IPR2013-
`
`00026, Paper 34 at 10–11 (P.T.A.B. Mar. 14, 2014). Common ownership or
`
`common counsel between related entities also did not necessarily create privity or
`
`an RPI relationship, without evidence that the corporate form had been ignored.
`
`See Aruze Gaming, IPR2014-01288, Paper 13 at 19–20 (P.T.A.B. Feb. 20, 2015)
`
`(citing Gillig v. Nike, Inc., 602 F.3d 1354, 1362 (Fed. Cir. 2010)); LG Display Co.,
`
`Ltd. v. Innovative Display Techs. LLC, IPR2014-01362, Paper 12 at 5–6 (P.T.A.B.
`
`Mar. 2, 2015); TRW Auto. U.S. LLC v. Magna Elecs. Inc., IPR2014-01351, Paper 7
`
`at 5–8 (P.T.A.B. Feb. 10, 2015). The mere existence of a parent-subsidiary
`
`relationship, without more, is insufficient to establish that a party “exercised or
`
`could have exercised control over [] participation in a proceeding” and “is funding
`
`or directing the proceeding.” Mobile Tech., Inc. v. Sennco Solutions, Inc.,
`
`IPR2017-02199 (P.T.A.B. Apr. 10, 2018); see also Puzhen Life USA, LLC v. Esip
`
`Series 2, LLC, IPR2017-02197 (P.T.A.B. Apr. 11, 2018). Under such pre-AIT
`
`guidance of the Patent Office and controlling authorities, ZTE TX was not an RPI.
`
`The AIT decision, which was marked as precedential by the Federal Circuit,
`
`changed the law as to how RPIs are determined. AIT came on the heels of the
`
`
`
`6
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`January 8, 2018 decision in Wi-Fi One, LLC v. Broadcom Corp., 878 F.3d 1364,
`
`1365 (Fed. Cir. 2018) wherein the Federal Circuit decided en banc that it did have
`
`jurisdiction to review the issue of time-bar determinations under 35 U.S.C. §
`
`315(b) (including RPIs in IPRs). Still, several months later, on April 20, 2018, the
`
`Federal Circuit quoted with approval the Patent and Trademark Office Patent Trial
`
`Practice Guide, 77 Fed. Reg. 48,756, 48,760 “[A] party that funds and directs and
`
`controls an IPR or [post-grant review] proceeding constitutes a ‘real party-in-
`
`interest,’ even if that party is not a ‘privy’ of the petitioner.” See Wi-Fi One, LLC
`
`v. Broadcom Corp., 887 F.3d 1329, 1336 (Fed. Cir. 2018).
`
`It was not until AIT that the Federal Circuit broadened the inquiry of 35
`
`U.S.C. § 315(b) to apply “not only what might be traditionally known as ‘real
`
`parties in interest,’ but privies as well.” Id. at 1347. AIT agreed with many of the
`
`principles expressed in the Trial Practice Guide. AIT at 9–10; see also id. at n.2
`
`(“we do not believe that any of the general legal principles expressed in the Trial
`
`Practice Guide cited by the Board here run contrary to the common-law
`
`understanding of “real party in interest.”). AIT also discussed the Taylor factors.
`
`However, AIT went further, building upon the Federal Circuit’s exploration in
`
`WesternGeco LLC v. ION Geophysical Corp. of “the meaning of ‘privy’ in the
`
`context of § 315(b),” to “examine the common-law meaning of ‘real party in
`
`interest’” and legislative intent in adopting this phrasing, indicating “it chose
`
`
`
`7
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`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`language that bars petitioners where proxies or privies would benefit from an
`
`instituted IPR, even where the petitioning party might separately have its own
`
`interest in initiating an IPR.” AIT at 1347–50 (citing WesternGeco, 889 F.3d 1308,
`
`1316–19 (Fed. Cir. 2018)). The Federal Circuit concluded “Congress intended that
`
`the term ‘real party in interest’ have its expansive common-law meaning” and that
`
`the Board’s view of RPI had been “unduly restrictive.” AIT at 1351, 1356. “Thus,
`
`the focus of the real-party-in-interest inquiry is on the patentability of the claims
`
`challenged in the IPR petition, bearing in mind who will benefit from having those
`
`claims canceled or invalidated.” Id. at 1348.
`
`Judge Reyna’s concurrence highlights that the Federal Circuit previously
`
`had no opportunity to address the definition of RPI (Id. at 1358-1359) and that his
`
`and the majority’s opinions broaden “the standard employed by the PTO in its real
`
`party in interest inquiry” (Id. at 1361, 1362). Patent Owner argues that there has
`
`been no change in the law, but its actions show that even Patent Owner recognized
`
`AIT as a change. Patent Owner filed a Complaint in the Northern District of Texas,
`
`asserting U.S. Patent No. 8,624,550, among others, against ZTE Corp., ZTE
`
`(USA), Inc., and ZTE (TX), Inc. on February 13, 2017. Between October 26, 2017
`
`and May 4, 2018, Petitioner filed eight (8) responsive petitions for IPRs
`
`consistently naming in each only ZTE Corp. and ZTE (USA) Inc. as RPIs. See
`
`Timeline below of Patent Owner filings in this and related IPRs (procedural filings
`
`
`
`8
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`and reference to parties removed from proceedings omitted), demonstrating Patent
`
`Owner’s failure to raise RPI issues until after the AIT decision.
`
`• 2/13/18 IPR2018-00111, Paper 12, Patent Owner’s Preliminary
`Response to Petition filed October 26, 2017 (does not raise any
`issues with RPIs)
`• 2/13/18 IPR2018-00110, Paper 11, Patent Owner’s Preliminary
`Response to Petition filed October 27, 2017 (does not raise any
`issues with RPIs)
`• 4/11/18 IPR2018-00425, Paper 8, Patent Owner’s Preliminary
`Response to Petition filed January 5, 2018 (does not raise any
`issues with RPIs)
`• 4/30/18 IPR2018-00215, Paper 10, Patent Owner’s Preliminary
`Response to Petition filed January 12, 2018 (does not raise any
`issues with RPIs)
`• 6/8/18 IPR2018-00214, Paper 10, Patent Owner’s Preliminary
`Response to Petition filed January 12, 2018 (does not raise any
`issues with RPIs)
`• 6/8/18 IPR2018-00274, Paper 9, Patent Owner’s Preliminary
`Response to Petition filed January 24, 2018 (does not raise any
`issues with RPIs)
`• 7/5/18 IPR2018-00276, Paper 8, Patent Owner’s Preliminary
`Response to Petition filed February 12, 2018 (does not raise any
`issues with RPIs)
`• - - - - - - 7/9/18 AIT v. RPX decided by Fed. Circuit - - - - - -
`• 8/21/18 IPR2018-00111, Paper 33, Patent Owner’s Response
`raises RPI issue for the first time (at 1, 17) (first served 8/15/18
`while PTAB system down)
`• 9/7/18 IPR2018-01076, Paper 11, Patent Owner’s Preliminary
`Response to Petition filed May 14, 2018 raises RPI issue for the
`first time (at 1, 4)
`• 10/16/18 IPR2018-00425, Paper 22, Patent Owner’s Response
`raises RPI issue for the first time (at 1, 23)
`
`The above sequence demonstrates that Patent Owner had many opportunities
`
`to take issue with the named real parties in interest but failed to do so until well
`
`
`
`9
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`after the one year date under 35 U.S.C. § 315, and well after institution. Despite
`
`their protests now, Patent Owner failed to raise any RPI issues in its Preliminary
`
`Response filed on February 13, 2018. See Paper 12. Patent Owner did not raise any
`
`issue with the named real parties in interest until their Response, after institution,
`
`and after the July 9, 2018 Applications in Internet Time, LLC v. RPX Corp. (“AIT”)
`
`decision. The same pattern appears in the related IPR cases; any issue with the
`
`named RPIs was not raised until after the AIT decision. Nonetheless Patent Owner
`
`now claims that the IPR “should never have been instituted” due to the “statutory
`
`requirements.” Paper 33, Patent Owner’s Response at 18.
`
`Patent Owner had no reason to raise an issue as to RPI because the standard
`
`for evaluating RPI did not change until AIT. Even assuming arguendo that Patent
`
`Owner had raised the issue in their Preliminary Response, Petitioner would be in
`
`the same situation. The timing of Patent Owner’s responses has not allowed
`
`Petitioner to respond to this issue until it was raised at a belated stage in the
`
`proceedings, and after the February 13, 2018 one-year bar under § 3152. Petitioner
`
`reached out to Patent Owner’s counsel in an attempt to resolve this but has resorted
`
`
`2 From the February 14, 2017 service date of the Complaint on ZTE (USA) Inc.
`and ZTE (TX), Inc. ZTE Corp. was not served until May 15, 2017, with the
`Amended Complaint.
`
`
`
`10
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`to Conference and motion practice due to Patent Owner’s unwillingness to accept a
`
`reasonable solution short of dismissal with adverse judgment.
`
`Even the phrasing of Patent Owner’s objection, once finally raised in its
`
`Response filed some three months after institution, suggests that Patent Owner
`
`regarded AIT as a change in the law. See Paper 33 at 1 (emphasis added), “The
`
`proceeding should be terminated because Petitioner failed to name ZTE (TX), Inc.
`
`and LG Corp. as real parties-in-interest ("PRIs"), under the standard recently
`
`clarified by the Federal Circuit.” See also id. at 17-18 (emphasis added):
`
`Recently, in Applications in Internet Time, LLC v. RPX Corp., Appeal
`Nos. 2017-1698, -1699 & -1701 (Fed. Cir. July 9, 2018), the Federal
`Circuit clarified that "the focus of the real-party-in-interest inquiry is
`on the patentability of the claims challenged in the IPR petition,
`bearing in mind who will benefit from having those claims canceled
`or invalidated." Slip Op. at 20; id. at 26 (the RPI inquiry requires
`determining "whether the non-party is a clear beneficiary that has a
`preexisting, established relationship with the petitioner"). Under this
`standard, Petitioner has failed to name at least ZTE (TX), Inc. . . .
`
`Patent Owner’s statements in the Conference with the Board also suggest
`
`that AIT was a shift or clarification by the Federal Circuit. See Trans. 20:1–13.
`
`2. There Is No Prejudice Because Fundamental Has Known
`
`About ZTE TX All Along
`
`Patent Owner sued ZTE TX and has therefore known about ZTE TX all
`
`along. See Civil Action Nos. 2:16-cv-01424-JRG-RSP and 2:16-cv-01425-JRG-
`
`RSP, pending in the U.S. District Court for the Eastern District of Texas, and Civil
`
`
`
`11
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`Action No. 3:17-cv-01827-N, pending in the U.S. District Court for the Northern
`
`District of Texas. This is not a case of a hidden party that was not discovered and
`
`therefore deprived Patent Owner of some type of needed discovery, etc.
`
`Any harm to Patent Owner in the form of estoppel scope will be fully
`
`remedied by retroactively naming ZTE TX as an RPI. This is what Patent Owner
`
`has asked for. As noted by the Board during the Conference on November 28,
`
`2018, naming ZTE TX would address any concerns as to identifying the parties for
`
`conflicts purposes, and create estoppel as to ZTE TX for future proceedings.
`
`3.
`
`PTAB Precedent Supports Retroactive Naming of an
`
`Additional RPI Without Impact to the Filing Date of the IPR
`
`In Elekta, Inc. v. Varian Medical Systems, Inc., the Board exercised its
`
`“discretion to maintain the Petition’s original filing date despite Petitioner’s
`
`amended RPI disclosure.” Elekta, Inc. v. Varian Med. Sys., Inc., IPR2015-01401,
`
`Paper 19 (P.T.A.B. Dec. 31, 2015). In doing so, the Board exercised their
`
`discretion in this nonjurisdictional area, with one judge commenting that “[p]atent
`
`owners have capitalized on the rule [i.e., 35 U.S.C. § 312(a)] as a means for having
`
`petitions denied on a basis unrelated to the merits presented in the petitions.” Id.
`
`In a later precedential decision, the Board has said that the statutory
`
`requirement of § 312(a) to name real parties in interest is not jurisdictional, and
`
`therefore the Board has discretion to allow parties to correct defects in the
`
`
`
`12
`
`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`identification of RPIs without changing the filing date. See Lumentum Holdings,
`
`Inc. v. Capella Photonoics, Inc., IPR2015-00739, Paper 38 at 4–5 (P.T.A.B. Mar.
`
`4, 2016) (quoting Elekta with approval, “[T]he [Supreme] Court has “adopted a
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`readily administrable bright line for determining whether to classify a statutory
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`limitation as jurisdictional.” Sebelius [v. Auburn Reg’l Med. Ctr.], 133 S. Ct. [817,]
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`824 [(2013)] (internal quotation marks omitted). That determination turns on
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`“whether Congress has clearly stated that the rule is jurisdictional; absent such a
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`clear statement, . . . courts should treat the restriction as nonjurisdictional in
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`character.” Id. (internal quotation marks and alteration omitted). Section 312(a)’s
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`emphatic “may be considered only if” language does not make those requirements
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`jurisdictional.”). “Simply stated, § 312(a) sets forth requirements that must be
`
`satisfied for the Board to give consideration to a petition, however, a lapse in
`
`compliance with those requirements does not deprive the Board of jurisdiction over
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`the proceeding, or preclude the Board from permitting such lapse to be rectified.”
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`Lumentum at 5.
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`The Board’s nonjurisdictional discretion is similarly merited in this case.
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`Here, as in Elekta, and as agreed upon during the November 28, 2018 Conference
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`between the parties and the Board, the core functions of the RPI requirement have
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`been met: “to assist members of the Board in identifying potential conflicts, and to
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`assure proper application of the statutory estoppel provisions.” USPTO Trial
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`
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`13
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`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`Practice Guide; see also Trans. 15:6–21, 19:16–24 (Korniczky, A.L.J.), 17:20–
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`18:11. Indeed, the Board stated in Elekta (at 9) that:
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`[a]bsent any indication of an attempt to circumvent estoppel rules, a
`petitioner’s bad faith, or prejudice to a patent owner caused by the
`delay, permitting a petitioner to amend challenged RPI disclosures
`while maintaining the original filing date promotes the core functions
`described in the Trial Practice Guide, while promoting also the ‘just,
`speedy, and inexpensive resolution of our proceedings.'
`
`
`Here, there is no indication of an attempt to circumvent estoppel rules, no
`
`indication of petitioner’s bad faith, and no real prejudice to the patent owner. See
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`Trans. 17:13–18:11, 21:17–22:5, 26:1–2. Therefore, “permitting [the] petitioner to
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`amend challenged RPI disclosures while maintaining the original filing date
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`promotes the core functions described in the Trial Practice Guide, while promoting
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`just, speedy, and inexpensive resolution of [the] proceedings.” Additionally, the
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`Board and the Federal Circuit have allowed reconsideration when there was a
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`change in the law, e.g., venue and patent term adjustment.
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`B. If The Board Denies Retroactive Addition of the RPI, Then The
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`Proceeding Should Be Terminated
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`Although the intervening change in the law justifies retroactive RPI
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`identification in this case, Petitioner acknowledges that absent retroactive
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`identification the proceeding should be terminated. Absent retroactive
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`
`
`14
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`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`identification, the petition never should have been granted (35 U.S.C. §312(a)(2)),
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`and therefore the proceeding should be terminated. Patent Owner likewise
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`acknowledged this in its Response to the petition, expressly arguing for
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`termination based on failure to name ZTE TX as an RPI. See Paper 33 at 17–19.
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`If the Board will not permit Petitioner to correct the flaw in the petition in
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`light of the intervening change in law, then there is no point in the parties or the
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`Board continuing to commit time and resources to a then-undisputedly and
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`procedurally flawed proceeding.
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`III. Conclusion
`The intervening change in controlling Federal Circuit law drives Petitioner’s
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`request for retroactive amendment of the named RPIs in this instituted IPR
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`proceeding. Patent Owner has had notice of the to-be-added party, ZTE TX, from
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`the time that they haled ZTE TX into suit, and would not be prejudiced by the
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`formal naming of ZTE TX as an RPI now. Indeed, the retroactive amendment
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`would not only address precisely the issues that Patent Owner has raised, but also
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`fully comply with statutory requirements and align with public policy. For these
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`reasons, Petitioner respectfully requests retroactive amendment of the named RPIs
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`in this proceeding and requests that the Board maintain the instituted inter partes
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`review under the timing as set forth in its earlier notices. See Paper 8 (“Notice of
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`Filing Date Accorded to Petition”) at 1; and Paper 16 (“Decision to Institute”).
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`
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`15
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`

`

`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`
`If, however, the Board refuses Petitioner’s request, Petitioner agrees that the
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`instant proceeding should be terminated, to achieve an efficient outcome for all
`
`parties. Therefore, in the alternative Petitioner respectfully requests termination of
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`the instant proceeding.
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`Date: December 6, 2018
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`Respectfully submitted,
`
`
`/Charles M. McMahon/
`Charles M. McMahon (Reg. No. 44,926)
`cmcmahon@mwe.com
`Brian A. Jones (Reg. No. 68,770)
`bajones@mwe.com
`Thomas M. DaMario (Reg. No. 77,142)
`tdamario@mwe.com
`MCDERMOTT WILL & EMERY
`444 West Lake Street
`Chicago, IL 60606-0029
`T: 312-372-2000
`
`Jiaxiao Zhang (Reg. No. 63,235)
`4 Park Plaza, Suite 1700
`Irvine, CA 92614
`T: 949-757-6398
`Attorneys for Petitioner
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`16
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`IPR2018-00111
`Motion to Retroactively Add a Real Party in Interest or Terminate This Proceeding
`
`
`CERTIFICATE OF SERVICE
`
`I certify that I sent a copy of Petitioner’s Motion to Retroactively Add a Real
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`Party in Interest or Terminate This Proceeding on December 6, 2018 to:
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`Hong Annita Zhong at hzhong@irell.com;
`
`Michael Fleming at mfleming@irell.com;
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`Jason Sheasby at jsheasby@irell.com; and
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`Patent Owner’s e-mail distribution list at FundamentalIPRs@irell.com.
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`/Charles M. McMahon/
`Charles M. McMahon
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`17
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