Trials@uspto.gov
`571-272-7822
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` Paper No. 28
`
`Entered: June 25, 2019
`
`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 IPR2018-00681 (Patent 7,061,997 B1)
`Case IPR2018-00682 (Patent 6,931,084 B1)
`Case IPR2018-00689 (Patent 6,993,084 B1)
`Case IPR2018-00690 (Patent 6,314,289 B1)
`____
`
`
`
`Before JEFFREY S. SMITH, STACEY G. WHITE, MICHELLE N.
`WORMMEESTER, and GARTH D. BAER, Administrative Patent Judges.
`
`BAER, Administrative Patent Judge.
`
`
`
`
`ORDER
`Granting Rehearing
`37 C.F.R. § 42.71
`
`
`
`571-272-7822
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` Paper No. 28
`
`Entered: June 25, 2019
`
`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 IPR2018-00681 (Patent 7,061,997 B1)
`Case IPR2018-00682 (Patent 6,931,084 B1)
`Case IPR2018-00689 (Patent 6,993,084 B1)
`Case IPR2018-00690 (Patent 6,314,289 B1)
`____
`
`
`
`Before JEFFREY S. SMITH, STACEY G. WHITE, MICHELLE N.
`WORMMEESTER, and GARTH D. BAER, Administrative Patent Judges.
`
`BAER, Administrative Patent Judge.
`
`
`
`
`ORDER
`Granting Rehearing
`37 C.F.R. § 42.71
`
`
`
`
`Case IPR2018-00681 (Patent 7,061,997 B1)
`Case IPR2018-00682 (Patent 6,931,084 B1)
`Case IPR2018-00689 (Patent 6,993,084 B1)
`Case IPR2018-00690 (Patent 6,314,289 B1)
`
`
`I.
`Introduction
`Sirius XM Radio Inc. (“Petitioner”) Requests Rehearing of our
`decision denying institution of inter partes review based on Petitioner’s
`failure to identify Sirius XM Holdings (“Holdings”) as a real party in
`interest (RPI). In its Rehearing Request, Petitioner asserts, inter alia, that
`we erred by not permitting Petitioner to amend its mandatory notices to add
`Holdings as an RPI without changing the Petition’s filing date. Paper 13, 2.1
`For the reasons provided below, Petitioner’s Rehearing Request is granted
`with respect to permission to add Holdings as an RPI.
`
`II. Background
`In our decision denying institution, we denied Petitioner authorization
`to amend its mandatory notices to add Holdings without changing the
`Petition’s filing date. Paper 12, 7. Petitioner filed a Request for Rehearing
`of our institution decision (Paper 13), and, on our authorization, Patent
`Owner filed a Response to Petitioner’s Request (Paper 17). After the Board
`issued precedential decisions addressing a similar RPI issue in Proppant
`Express Investments, LLC v. Oren Technologies, LLC, Case IPR2017–01917
`(Feb. 13, 2019) (Paper 86) (precedential) (“Proppant”), and Adello Biologics
`LLC v. Amgen Inc., Case PGR2019–00001 (Feb. 14, 2019) (Paper 11)
`(precedential) (“Adello”), we invited the parties to file briefs addressing
`those decisions. Paper 18. Petitioner filed a Supplemental Authority Brief
`in Support of Its Request for Rehearing (Paper 19, “Brief” or “Br.”),
`
`
`1 The cited documents were filed in IPR2018-00681. Corresponding
`documents were filed in the other proceedings captioned above.
`2
`
`
`
`
`
`Case IPR2018-00681 (Patent 7,061,997 B1)
`Case IPR2018-00682 (Patent 6,931,084 B1)
`Case IPR2018-00689 (Patent 6,993,084 B1)
`Case IPR2018-00690 (Patent 6,314,289 B1)
`
`accompanied by an updated Mandatory Notice that included Holdings as an
`RPI (Paper 21). Patent Owner then filed a Response to Petitioner’s
`Supplemental Brief Regarding Request for Rehearing. Paper 22 (“Resp.”).
`
`III. Analysis
`A party requesting rehearing has the “burden of showing a decision
`must be modified.” 37 C.F.R. § 42.71(d)(2). The decision is reviewed “for
`an abuse of discretion,” 37 C.F.R. § 42.71(c), which may be indicated if it is
`based on an erroneous interpretation of law. See Star Fruits S.N.C. v. United
`States, 393 F.3d 1271, 1281 (Fed. Cir. 2005). Here, we agree with Petitioner
`that our institution decision was based on an erroneous interpretation of law.
`Specifically, in our decisions denying institution, we denied Petitioner
`authorization to amend its mandatory notices to add Holdings based on our
`finding that Petitioner had not shown good cause for its omission of
`Holdings and had not shown why allowing the amendment would be in the
`interests of justice. That, however, is not the framework for determining
`whether to allow an RPI amendment as set forth in Proppant and Adello.
`For the reasons explained below, Petitioner has demonstrated that, under the
`framework set forth in Proppant and Adello, it should be allowed to add
`Holdings as an RPI.2
`A petition requesting an inter p artes review “may be considered only
`if . . . the petition identifies all real parties in interest.” 35 U.S.C.
`
`
`2 Because Petitioner has now amended its Petition to add Holdings as an RPI
`under § 312(a)(2), we decline to address Petitioner’s arguments that
`Holdings is not an RPI as moot.
`
`
`
`
`3
`
`
`
`Case IPR2018-00681 (Patent 7,061,997 B1)
`Case IPR2018-00682 (Patent 6,931,084 B1)
`Case IPR2018-00689 (Patent 6,993,084 B1)
`Case IPR2018-00690 (Patent 6,314,289 B1)
`
`§ 312(a)(2). However, failures in identifying all RPIs are not “designed to
`award a patent owner . . . a windfall.” Adello at 3. Thus, when an initial
`petition fails to identify all RPIs as required under § 312(a)(2), “[t]he Board
`may, under 35 U.S.C. § 312(a), accept updated mandatory notices as long as
`the petition would not have been time barred under 35 U.S.C. § 315(b) if it
`had included the real party in interest.” Proppant at 7.
`In considering whether to permit a petitioner to amend its
`identification of RPIs, we consider “whether there have been (1) attempts to
`circumvent the § 315(b) bar or estoppel rules, (2) bad faith by the petitioner,
`(3) prejudice to the patent owner caused by the delay, or (4) gamesmanship
`by the petitioner.” Proppant at 6–7. Absent a showing of an attempt to
`circumvent the § 315(b) bar and estoppel rules, bad faith, gamesmanship, or
`undue prejudice to a patent owner, a petitioner generally may amend its RPI
`disclosures without changing a petition’s filing date. See id. at 6–7, 9–16;
`Adello at 3–6.
`1. Attempts to Circumvent the § 315(b) Bar or Estoppel Rules
`It is undisputed that when the Petition was originally filed, Holdings
`was not subject to the § 315(b) time bar. In addition, because no final
`written decision has issued with respect to the challenged patents, there is no
`allegation that Holdings would have been estopped under 35 U.S.C. § 315(e)
`or 37 C.F.R. § 42.73(d) from asserting the Petition. Patent Owner asserts
`that Petitioner’s omission of Holdings “was clearly an attempt to circumvent
`the § 315 bar and estoppel rules” because Petitioner wanted “to keep open
`the possibility of a future IPR petition by SXM Holdings.” Resp. 5, 6
`(internal quotation and alterations omitted). We disagree. Petitioner offers a
`
`
`
`4
`
`
`
`Case IPR2018-00681 (Patent 7,061,997 B1)
`Case IPR2018-00682 (Patent 6,931,084 B1)
`Case IPR2018-00689 (Patent 6,993,084 B1)
`Case IPR2018-00690 (Patent 6,314,289 B1)
`
`sufficient explanation for omitting Holdings as an RPI in “its good faith
`belief and argument in its Reply and Request that Holdings is not an RPI.”
`Br. 4. Beyond Patent Owner’s speculation, we are not aware of any
`evidence suggesting that Holdings intended to file a subsequent petition,
`should the present Petition fail. Absent such evidence, we decline to infer
`ulterior motives on Petitioner’s part. See Adello at 5 (“Given the severe
`penalties imposed on one who knowingly and willfully falsifies or conceals
`a material fact . . . , we are satisfied with Adello’s express representation that
`it did not act in bad faith, or engage in gamesmanship.”).
`2. Bad Faith and Gamesmanship
`Patent Owner argues that Petitioner’s omission of Holdings as an RPI
`was in bad faith because Petitioner refused to amend its disclosures until
`after our decision denying institution based on Holdings’ RPI status.
`Resp. 7. According to Patent Owner, Petitioner maintained its refusal to add
`Holdings as an RPI even though “Petitioner’s counsel clearly knew about
`SXM Holdings” and “[Holdings’] status as RPI was not a close call.” Id. at
`6. We disagree with Patent Owner’s argument.
`Petitioner offers a sufficient explanation for its delay—its good faith
`belief that Holdings was not an unnamed RPI. As Petitioner notes, before
`our decision denying institution, Petitioner provided arguments along with
`unrebutted testimony supporting its good-faith belief that Holdings is not an
`RPI. Br. 4. Although we ultimately did not agree with Petitioner’s position,
`we disagree with Patent Owner’s characterization of the issue as “not a close
`call.” Resp. 6. Holding’s status as an RPI was a close and hotly contested
`issue, as RPI issues often are.
`
`
`
`5
`
`
`
`Case IPR2018-00681 (Patent 7,061,997 B1)
`Case IPR2018-00682 (Patent 6,931,084 B1)
`Case IPR2018-00689 (Patent 6,993,084 B1)
`Case IPR2018-00690 (Patent 6,314,289 B1)
`
`
`In addition, we see no reason to infer bad faith or gamesmanship in
`Petitioner’s delay in amending after our institution denial, as Patent Owner
`asserts. Resp. 7. Petitioner explains that its decision not to amend while its
`Rehearing Request was pending was “intended to maintain its duty of candor
`and good faith to the Office as it retained a good faith belief that, under the
`facts and law, Holdings did not qualify as an RPI.” Br. 4. Petitioner’s
`conduct supports its explanation. Specifically, Petitioner did eventually
`amend its notices to add Holdings after our precedential Proppant decision
`sanctioned a petitioner’s request to identify additional RPIs “without
`admitting they are in fact real parties-in-interest.” Proppant at 14. In sum,
`absent evidence to the contrary, we see no reason to question Petitioner’s
`assurances that its conduct in identifying RPIs was based on its good faith
`belief that it had complied with the RPI requirement. See Br. 4.
`3. Prejudice
`In general, “[a]llowing Petitioners to update the mandatory notices
`while maintaining the original filing date promotes the core functions of RPI
`disclosures and secures a ‘just, speedy, and inexpensive resolution’ of this
`proceeding.” Adello at 3–5. In addition, “neither the statute nor the rule
`governing RPI disclosures is designed to award a patent owner such a
`windfall.” Id.
`Patent Owner argues that Petitioner’s delay in identifying Holdings
`caused it to devote significant time and resources to briefing the real-party-
`in-interest issue before the Board. Resp. 7. That prejudice, however, does
`not warrant termination. See Proppant at 10 (explaining that “the cost of
`having to litigate a good faith dispute between the parties” is not “the type of
`
`
`
`6
`
`
`
`Case IPR2018-00681 (Patent 7,061,997 B1)
`Case IPR2018-00682 (Patent 6,931,084 B1)
`Case IPR2018-00689 (Patent 6,993,084 B1)
`Case IPR2018-00690 (Patent 6,314,289 B1)
`
`prejudice sufficient to warrant termination”). There is no indication of
`material benefit to Petitioner as a result of the delay, or negative effect on
`Patent Owner’s ability to challenge the Petition, if we permit the
`amendment. On the other side, the prejudice to Petitioner if we do not
`permit the amendment without losing the Petition’s original filing date is
`potentially drastic because the Petition would fall outside the one-year time
`bar under 35 U.S.C. § 315(b).
`
`IV. Conclusion
`For the reasons outlined above, Petitioner has demonstrated that it
`should be allowed to add Holdings as an RPI without losing its original
`filing date.
`
`V. Order
`
`Accordingly, it is
`ORDERED that Petitioner’s Request for Rehearing is granted,
`FURTHER ORDERED that Sirius XM Holdings Inc. is identified as
`an RPI; and
`FURTHER ORDERED that this identification of RPIs shall not
`change the filing date of the Petition.
`A decision whether to institute review on the merits of Petitioner’s
`challenges to the claims in view of prior art will be issued in due course.
`
`
`
`
`
`
`
`
`7
`
`
`
`Case IPR2018-00681 (Patent 7,061,997 B1)
`Case IPR2018-00682 (Patent 6,931,084 B1)
`Case IPR2018-00689 (Patent 6,993,084 B1)
`Case IPR2018-00690 (Patent 6,314,289 B1)
`
`PETITIONER:
`
`Jonathan S. Caplan
`Jeffrey H. Price
`Shannon H. Hedvat
`KRAMER LEVIN NAFTALIS & FRANKEL LLP
`jcaplan@kramerlevin.com
`jprice@kramerlevin.com
`shedvat@kramerlevin.com
`
`
`PATENT OWNER:
`
`Ben J. Yorks
`Babak Redjaian
`David McPhie
`IRELL & MANELLA LLP
`byorks@irell.com
`bredjaian@irell.com
`dmcphie@irell.com
`
`
`
`8
`
`
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