Trials@uspto.gov
`571-272-7822
`
` Paper No. 11
` Entered: September 21, 2018
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`SIRIUS XM RADIO, INC.,
`Petitioner,
`
`v.
`
`FRAUNHOFER-GESELLSCHAFT ZUR FÖRDERUNG DER
`ANGEWANDTEN FORSCHUNG E.V.,
`Patent Owner.
`____________
`
`Case IPR2018-00689
`Patent 6,993,084 B1
`____________
`
`Before JEFFREY S. SMITH, STACEY G. WHITE, and
`MICHELLE N. WORMMEESTER, Administrative Patent Judges.
`
`WORMMEESTER, Administrative Patent Judge.
`
`DECISION
`Denying Institution of Inter Partes Review
`37 C.F.R. § 42.108
`
`
`571-272-7822
`
` Paper No. 11
` Entered: September 21, 2018
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`SIRIUS XM RADIO, INC.,
`Petitioner,
`
`v.
`
`FRAUNHOFER-GESELLSCHAFT ZUR FÖRDERUNG DER
`ANGEWANDTEN FORSCHUNG E.V.,
`Patent Owner.
`____________
`
`Case IPR2018-00689
`Patent 6,993,084 B1
`____________
`
`Before JEFFREY S. SMITH, STACEY G. WHITE, and
`MICHELLE N. WORMMEESTER, Administrative Patent Judges.
`
`WORMMEESTER, Administrative Patent Judge.
`
`DECISION
`Denying Institution of Inter Partes Review
`37 C.F.R. § 42.108
`
`
`
`IPR2018-00689
`Patent 6,993,084 B1
`
`
`I. BACKGROUND
`
`Sirius XM Radio, Inc. (“Petitioner” or “Sirius XM”) filed a Petition
`
`(Paper 1, “Pet.”) requesting inter partes review of claims 1–3, 6–12, 14–21,
`
`and 23 of U.S. Patent No. 6,993,084 B1 (Ex. 1001, “the ’3084 patent”).
`
`Fraunhofer-Gesellschaft zur Förderung der angewandten Forschung e.V
`
`(“Patent Owner”) filed a Preliminary Response (Paper 7, “Prelim. Resp.”),
`
`contending that we should deny the Petition as defective because Petitioner
`
`failed to name Sirius XM Holdings Inc. (“Holdings”) and Liberty Media
`
`Corp. (“Liberty”) as real parties in interest (“RPIs”). Prelim. Resp. 1–3.
`
`With our permission, Petitioner filed a Reply to Patent Owner’s Preliminary
`
`Response (Paper 8, “Pet. Reply”), and Patent Owner filed a Sur-Reply
`
`(Paper 10, “PO Sur-Reply”).
`
`For the reasons explained below, we determine that Petitioner has not
`
`satisfied its burden of establishing that Holdings has been properly omitted
`
`as an RPI in this proceeding. Accordingly, we do not institute an inter
`
`partes review of the challenged claims.
`
`A. RELATED MATTERS
`
`The ’997 patent is involved in Fraunhofer-Gesellschaft zur Förderung
`
`der angewandten Forschung e.V. v. Sirius XM Radio Inc., 1:17-cv-00184
`
`(D. Del. Feb. 22, 2017). Pet. 4; Paper 4, 1.
`
`II. DISCUSSION
`
`In accordance with 35 U.S.C. § 312(a)(2) and 37 C.F.R. § 42.8(b)(1),
`
`Petitioner identifies “Sirius XM Radio, Inc.” (“Sirius XM”) as the only real
`
`party-in-interest. Pet. 3. Patent Owner asserts that we should deny the
`
`Petition as defective because Petitioner should have also listed Sirius XM
`
`
`
`2
`
`
`
`IPR2018-00689
`Patent 6,993,084 B1
`
`Holdings Inc. (“Holdings”) and Liberty Media Corporation (“Liberty”) as
`
`RPIs. Prelim. Resp. 1–3.
`
`A. PRINCIPLES OF LAW
`
`A petition for inter partes review “may be considered only if . . . the
`
`petition identifies all real parties-in-interest.” 35 U.S.C. § 312(a)(2). The
`
`statutory requirement defines a “threshold issue” for substantive review of
`
`the merits of the challenges presented in the Petition. See ZOLL Lifecor
`
`Corp. v. Philips Elecs. N. Am. Corp., Case IPR2013-00606, slip op. at 8
`
`(PTAB Mar. 20, 2014) (Paper 13). A patent owner challenging a
`
`petitioner’s real party-in-interest disclosure must provide sufficient evidence
`
`to show a petitioner’s disclosure is inadequate. Intellectual Ventures Mgmt.,
`
`LLC v. Xilinx, Inc., Case IPR2012-00018, slip op. at 3 (PTAB Jan. 24, 2013)
`
`(Paper 12). When a patent owner provides sufficient evidence before
`
`institution that reasonably brings into question the accuracy of a petitioner’s
`
`identification of real parties-in-interest, the overall burden remains with the
`
`petitioner to establish that it has complied with the statutory requirement to
`
`identify all real parties-in-interest. Zerto, Inc. v. EMC Corp., Case IPR2014-
`
`01254, slip op. at 6–7 (PTAB Feb. 12, 2015) (Paper 32).
`
`“Whether a party who is not a named participant in a given
`
`proceeding nonetheless constitutes a ‘real party-in-interest’ . . . to that
`
`proceeding is a highly fact-dependent question” with no “bright line test,”
`
`and is assessed “on a case-by-case basis.” Office Patent Trial Practice
`
`Guide, 77 Fed. Reg. 48,756, 48,759 (Aug. 14, 2012) (citing Taylor v.
`
`Sturgell, 553 U.S. 880, 893–95 (2008) (“Practice Guide”)). As explained in
`
`our Practice Guide, multiple factors relate to whether a non-party should be
`
`identified as an RPI. Id. These factors may include, for example, whether a
`
`
`
`3
`
`
`
`IPR2018-00689
`Patent 6,993,084 B1
`
`non-party exercises control over a petitioner’s participation in the
`
`proceeding and whether the non-party is directing the proceeding. Id. at
`
`48,759–60.
`
`The concept of control generally means that “the nonparty has the
`
`actual measure of control or opportunity to control that might reasonably be
`
`expected between two formal coparties.” Id. at 48,759 (citing 18A Charles
`
`Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice &
`
`Procedure §§ 4449, 4451 (2d ed. 2011) (“Wright and Miller”)). “[T]here is
`
`no ‘bright-line test’ for determining the necessary quantity or degree of
`
`participation to qualify as a ‘real party-in-interest’ . . . based on the control
`
`concept.” Id. (citing Gonzalez v. Banco Cent. Corp., 27 F.3d 751, 759 (1st
`
`Cir. 1994). Indeed, the “measure of control by a nonparty that justifies
`
`preclusion cannot be defined rigidly.” Id. (citing Wright & Miller § 4451).
`
`In addition, “[d]etermining whether a non-party is a ‘real party in interest’
`
`demands a flexible approach that takes into account both equitable and
`
`practical considerations, with an eye toward determining whether the non-
`
`party is a clear beneficiary that has a preexisting, established relationship
`
`with the petitioner.” Applications in Internet Time, LLC v. RPX Corp., 897
`
`F.3d 1336, 1351 (Fed. Cir. 2018).
`
`B. HOLDINGS’ STATUS AS AN UNNAMED RPI
`
`We determine Patent Owner provides sufficient evidence to
`
`reasonably bring into question the accuracy of Petitioner’s identification of
`
`real parties-in-interest. Patent Owner presents undisputed evidence that
`
`Petitioner is a wholly owned subsidiary of Holdings. Prelim. Resp. 7 (citing
`
`Ex. 2005, 4). In addition, a Securities and Exchange Commission Form 10-
`
`K for 2017 states that Holdings has “no operations independent of its
`
`
`
`4
`
`
`
`IPR2018-00689
`Patent 6,993,084 B1
`
`subsidiary Sirius XM.” Ex. 2005, 4. The names and titles for all nine of
`
`Holdings’ executive officers—including the Chief Executive Officer and
`
`General Counsel—are the same as those of Sirius XM, and both entities
`
`have the same physical business address. See Ex. 2008, 2–3; Ex. 2007, 6.
`
`Holdings also states in its filings with the SEC that “we are a defendant” in a
`
`number of legal proceedings, based on lawsuits that name only Sirius XM,
`
`and not Holdings as a defendant. See Ex. 2005, 31–33 (emphasis added).
`
`Holdings states further “we are a defendant in . . . actions filed by . . .
`
`owners of patents.” Id. at 34. Holdings also reported entering into and
`
`funding a settlement in certain class-action lawsuits, even though the suits
`
`were all against its wholly-owned subsidiary Sirius XM. See Ex. 2013, 19;
`
`Ex. 2016, 1.
`
`We further conclude Petitioner has not met its burden to establish that
`
`it has complied with the statutory requirement to identify all RPIs.
`
`Petitioner does not challenge Patent Owner’s factual allegations, but instead
`
`asserts that “Patent Owner’s evidence here, at best, only ‘establishes a [stock
`
`ownership] relationship between parties and does not establish a relationship
`
`between Holdings and this proceeding.’” Pet. Reply 2 (quoting Daifuku Co.
`
`v. Murata Machinery, Ltd., Case IPR2015-01538, slip op. at 11 (PTAB Jan.
`
`19, 2016) (Paper 11)). Petitioner also submits a declaration from its (and
`
`Holdings’) General Counsel, asserting that Holdings has not and will not
`
`actually direct, control, or fund these proceedings. Ex. 1025 ¶¶ 12–15.
`
`We are not persuaded by Petitioner’s arguments because actual
`
`control is not the only measure for determining an unnamed RPI. See RPX,
`
`897 F.3d at 1351. Instead, the RPI inquiry includes the “opportunity to
`
`control that might reasonably be expected between two formal coparties,”
`
`
`
`5
`
`
`
`IPR2018-00689
`Patent 6,993,084 B1
`
`Practice Guide at 48,759 (citing Wright and Miller §§ 4449, 4451), and
`
`“takes into account both equitable and practical considerations, with an eye
`
`toward determining whether the non-party is a clear beneficiary that has a
`
`preexisting, established relationship with the petitioner,” RPX, 897 F.3d at
`
`1351.
`
`Beyond Holdings’ ownership of Petitioner and the complete
`
`management overlap between the two entities, the undisputed evidence
`
`suggests Holdings and Petitioner are jointly involved in legal matters,
`
`including patent-related lawsuits and those that name only Petitioner. See
`
`Ex. 2005, 31–34. In addition, in at least some of those proceedings,
`
`Holdings has participated in settlement negotiations and made settlement
`
`payments. Id. at 31–33; Ex. 2013, 19; Ex. 2016, 1. Based on Holdings’ full
`
`ownership of Petitioner, its identical management composition, and evidence
`
`of its past control in legal matters involving Petitioner, we determine that
`
`Holdings “is a clear beneficiary that has a preexisting, established
`
`relationship with the petitioner.” RPX, 897 F.3d at 1351. Thus, based on the
`
`evidence and arguments presented by Petitioner and Patent Owner,
`
`Petitioner has not sufficiently established it has identified all the real parties-
`
`in-interest in the Petition, as required by 35 U.S.C. § 312(a)(2).1
`
`C. PETITIONER’S REQUEST TO AMEND ITS RPI DISCLOSURES WITHOUT
`CHANGING THE PETITION’S FILING DATE
`
`Petitioner requests that if the Board considers Holdings an unnamed
`
`RPI, we grant Petitioner authorization to amend its mandatory notices
`
`without changing the Petition’s filing date. Pet. Reply 5. Patent Owner
`
`
`1 Because we determine Petitioner did not meet its burden with respect to
`Holdings, we need not and do not determine whether Petitioner met its
`burden with respect to Liberty.
`
`
`
`6
`
`
`
`IPR2018-00689
`Patent 6,993,084 B1
`
`contends we should not permit Petitioner to amend its RPI disclosures
`
`without losing the Petition’s original filing date. Prelim. Resp. 25–28.
`
`Under 37 C.F.R. § 42.5(c)(3), Petitioner’s “late action will be excused
`
`on a showing of good cause or upon a Board decision that consideration on
`
`the merits would be in the interests of justice.” In this case, Petitioner offers
`
`no reason why permitting it to add Holdings as an RPI while maintaining the
`
`original filing date is in the interests of justice, beyond that “Patent Owner
`
`has not suffered and cannot seriously claim any prejudice.” Pet. Reply 5.
`
`Petitioner also does not offer any good cause for its omission of Holdings,
`
`and has not actually amended its mandatory notices to include Holdings as
`
`an RPI. Instead, Petitioner conditions its willingness to add Holdings on our
`
`finding that the Petition was deficient. In these circumstances, we decline to
`
`excuse Petitioner’s late action.
`
`III. CONCLUSION
`
`For all of the reasons discussed above, we do not institute review in
`
`this proceeding with respect to claims 1–3, 6–12, 14–21, and 23.
`
`It is:
`
`IV. ORDER
`
`ORDERED that the Petition is denied as to claims 1–3, 6–12, 14–21,
`
`and 23 of the ’3084 patent; and
`
`FURTHER ORDERED that no inter partes review is instituted.
`
`
`
`
`
`
`
`
`
`
`
`7
`
`
`
`IPR2018-00689
`Patent 6,993,084 B1
`
`
`PETITIONER:
`
`Jonathan Caplan
`jcaplan@kramerlevin.com
`
`Shannon Hedvat
`shedvat@kramerlevin.com
`
`Jeffrey Price
`jprice@kramerlevin.com
`
`
`PATENT OWNER:
`
`Ben Yorks
`byorks@irell.com
`
`Babak Redjaian
`bredjaian@irell.com
`
`David McPhie
`dmcphie@irell.com
`
`
`
`
`8
`
`
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