Trials@uspto.gov Paper 31
`
`571-272-7822
` Date Entered: December 20, 2018
`
`
`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`UNIFIED PATENTS INC.,
`Petitioner,
`
`v.
`
`BRADIUM TECHNOLOGIES LLC,
`Patent Owner.
`____________
`
`Case IPR2018-00952
`Patent 9,253,239 B2
`____________
`
`Before BRYAN F. MOORE, BRIAN J. McNAMARA, and
`MINN CHUNG, Administrative Patent Judges.
`
`Opinion of the Board filed by Administrative Patent Judge MOORE
`Opinion Dissenting filed by Administrative Patent Judge CHUNG
`
`
`
`
`DECISION
`Granting Institution of Inter Partes Review
`35 U.S.C. § 314
`
`
`
`
`
`
`
`
`571-272-7822
` Date Entered: December 20, 2018
`
`
`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`UNIFIED PATENTS INC.,
`Petitioner,
`
`v.
`
`BRADIUM TECHNOLOGIES LLC,
`Patent Owner.
`____________
`
`Case IPR2018-00952
`Patent 9,253,239 B2
`____________
`
`Before BRYAN F. MOORE, BRIAN J. McNAMARA, and
`MINN CHUNG, Administrative Patent Judges.
`
`Opinion of the Board filed by Administrative Patent Judge MOORE
`Opinion Dissenting filed by Administrative Patent Judge CHUNG
`
`
`
`
`DECISION
`Granting Institution of Inter Partes Review
`35 U.S.C. § 314
`
`
`
`
`
`
`
`
`IPR2018-00952
`Patent 9,253,239 B2
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`BACKGROUND
`Unified Patents, Inc. (“Petitioner”) filed a petition, Paper 2 (“Pet.”), to
`institute an inter partes review of claims 1–25 (the “challenged claims”) of
`U.S. Patent No. 9,253,239 B2 (“the ’239 Patent”). 35 U.S.C. § 311.
`Bradium Technologies LLC (“Patent Owner”) timely filed a Preliminary
`Response, Paper 20 (“Prelim. Resp.”), contending that the Petition should be
`denied as to all challenged claims. We have authority to determine whether
`to institute an inter partes review under 37 C.F.R. § 42.4(a) and 35 U.S.C.
`§ 314, which provides that an inter partes review may not be instituted
`unless the information presented in the Petition “shows that there is a
`reasonable likelihood that the petitioner would prevail with respect to at least
`1 of the claims challenged in the petition.” Having considered the
`arguments and the associated evidence presented in the Petition and the
`Preliminary Response, for the reasons described below, we institute inter
`partes review.
`In its Preliminary Response, Patent Owner asserted Petitioner had not
`named all real parties-in-interest. Prelim. Resp. 1. In accordance with our
`authorization (see Papers 23 and 27) Petitoner filed a Reply (Paper 26, “RPI
`Reply”) and Patent Owner filed a Sur-Reply (Paper 29, “RPI Sur-Reply”) on
`that the real parties-in-interest issue.
`
`
`REAL PARTIES IN INTEREST
`Patent Owner argues that the Petition should be denied because
`Petitioner failed to identify all real parties-in-interest (RPIs). Prelim. Resp.
`9. In accordance with 35 U.S.C. § 312(a)(2) and 37 C.F.R. § 42.8(b)(1),
`Petitioner identifies itself, Unified Patents, Inc., as the only real-party-in-
`
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`interest (“RPI”). Pet. 2. Petitioner Unified Patents’s business model
`includes membership by companies. Prelim. Resp. 7. Patent Owner asserts
`that two members of Petitioner are RPIs that should have been named in the
`Petition. RPI Sur-Reply 2. Specifically, Patent Owner does not contend that
`all members of Petitioner are RPIs, rather Patent Owner “contends only that
`two specific members of Unified . . . are RPIs.” Id. Based on that failure to
`name those alleged RPIs, Patent Owner requests that we dismiss the Petition.
`Prelim. Resp. 1, 10. Even if the members of Petitioner that Patent Owner
`cites as potential RPIs should be named RPIs, failure to identify them as
`such at the time the Petition was filed does not require us to terminate the
`proceeding. This is because Patent Owner does not allege that inclusion of
`any specified member of Petitioner as an RPI would have barred the Petition
`under 35 U.S.C. § 315. RPI Sur-Reply 6.
`Aside from a bar defense, under the Board’s precedential decision in
`Lumentum Holdings, Inc. v. Capella Photonics, Inc., our jurisdiction to
`consider a petition does not require a “correct” identification of all RPIs in a
`petition. Case IPR2015–00739, slip op. at 6 (PTAB Mar. 4, 2016) (Paper
`38) (precedential); see also Blue Coat Sys., Inc. v. Finjan, Inc., Case
`IPR2016–01444, slip op. at 10 (PTAB July 18, 2017) (Paper 11) (“Evidence
`[of failure to identify all RPIs] is, at best, suggestive of an issue that is not
`jurisdictional.”). Indeed, later PTAB decisions indicate that a petition may
`be corrected after institution of trial to add a real party in interest if
`warranted without assigning a new filing date to the petition. E.g., Axon EP,
`Inc.v. Derrick Corp., Case IPR2016–00642, slip op. at 3 (PTAB Nov. 21,
`2016) (Paper 17).
`
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`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). When
`a patent owner provides sufficient evidence prior to institution that
`reasonably brings into question the accuracy of a petitioner’s identification
`of RPIs, the overall burden remains with the petitioner to establish that it has
`complied with the statutory requirement to identify all RPIs. Zerto, Inc. v.
`EMC Corp., Case No. IPR2014-01295, slip op. at 6–7 (PTAB Feb. 12,
`2015) (Paper 31).
`“[A]t a general level, the ‘real party-in-interest’ is the party that
`desires review of the patent.” Office Patent Trial Practice Guide, 77 Fed.
`Reg. 48,756, 48,759 (Aug. 14, 2012) (“Trial Practice Guide”). “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.” Trial Practice Guide, 48,759 (citing Taylor v. Sturgell, 553
`U.S. 880, 893–95 (2008)). A common consideration is whether the non-
`party exercised or could have exercised control over the proceeding. Trial
`Practice Guide, 48,759 (citing Charles Alan Wright, Arthur R. Miller &
`Edward H. Cooper, Federal Practice & Procedure (“Wright & Miller”)
`§ 4451). 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.
`Actual control is not the only measure— “[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
`
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`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)
`(“AIT”). Relevant factors in the RPI analysis include “Party A’s relationship
`with the petitioner; Party A’s relationship to the petition itself, including the
`nature and/or degree of involvement in the filing; and the nature of the entity
`filing the petition.” Trial Practice Guide, 48,760.
`We acknowledge that, prior to AIT, Board decisions cited by Patent
`Owner found Petitioner’s members were not RPIs primarily due to a lack of
`control over the IPR by the member.1 Prelim. Resp. 10. We also
`acknowledge two Board cases decided post-AIT cited by Patent Owner find
`Petitioner’s members are not RPIs under the broader AIT rubric.2 RPI Sur-
`Reply 4. Patent Owner asserts these cases were wrongly decided. Id. None
`of those cases is designated precedential and we decide this case on its own
`merits.
`Arguments
`There appears to be no dispute to Petitioner’s assertion that it
`“controlled, directed and funded this petition, did not communicate with any
`
`
`1 For example, Patent Owner cites Unified Patents Inc. v. Qurio
`Holdings, Inc., IPR2015-01940, Paper 7 at 26 (PTAB Apr. 13, 2016)
`(Comcast not real party-in-interest due to lack of “actual proof that Comcast
`exerted control over the Petition.”) and Unified Patents Inc. v. American
`Vehicular Sciences, LLC, IPR2016-00364, Paper 13 at 6 (PTAB June 27,
`2016) (“Patent Owner provides no evidence that any other entity actually is
`controlling this particular proceeding, or is providing direct financing for
`this particular proceeding.”)
`2 Patent owner cites Unified Patents Inc. v. Realtime Adaptive
`Streaming, LLC, IPR2018-00883 (Oct. 11, 2018); Unified Patent v.
`Plectrum LLC, IPR 2017-01430 (Paper 30, Nov. 13, 2018).
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`of its members regarding filing, and that none of Unified’s members have
`been sued by Braduim.” RPI Reply 2. As explained below, considering
`these facts and the totality of the circumstances presented in the case, we do
`not find that the two members of Petitioner cited by Patent Owner were
`RPIs.
`
`
`
`Patent Owner’s arguments are premised on its contention that
`In [AIT], the court took special note of the following facts, among
`others: (1) ‘RPX, unlike a traditional trade association, is a for-
`profit company whose clients pay for its portfolio of ‘patent risk
`solutions’’ (Id.); (2) one of RPX’s strategies is ‘the facilitation of
`challenges to patent validity" to ‘reduce expenses for [RPX’ s]
`clients’ (Id. ); (3) the fact that RPX may not discuss specific IPRs
`with clients may be for the purpose of circumventing the RPI
`requirement. Id., 1352, n.4. Collectively, these facts ‘imply that
`RPX can and does file IPRs to serve its clients’ financial
`interests, and that a key reason clients pay RPX is to benefit from
`this practice in the event they are sued by an NPE.’ Id.
`Prelim. Resp. 5. In other words, Patent Owner asserts that the business
`model of RPX implies that RPX files IPRs to serve its clients’ financial
`interest. We consider additonal factors because AIT does not state that filing
`RPIs to serve a clients (members) financial interest alone is a relationship
`that makes a client an RPI; rather, the court remanded for the Board to
`consider that and other questions. AIT, 897 F.3d at 1352–54. Based on its
`reading of AIT Patent Owner lists several similarities between RPX and
`Petitioner. Prelim. Resp. 5–9. For example, Patent Owner asserts
`RPX was a for-profit company set up to help paying members by
`filing IPRs to help them avoid litigation and to reduce their
`expenses, and AIT found that this alone implied that ‘RPX can
`and does file IPRs to serve its clients’ financial interests, and that
`a key reason clients pay RPX is to benefit from this practice . . . .’
`
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`AIT, 897 F.3d at 1352. There is no difference between Unified
`and RPX insofar as this implication is concerned.
`RPI Sur-Reply 5 (emphasis omitted).
`Specifically, Patent Owner asserts that, among other things: A
`“unique and important part of Unified Patents’ overall strategy is filing inter
`partes review petitions to undermine current assertions based on invalid
`patents by large nonpracticing entities against companies in the technology
`industry ... and to deter future claims in the same space” (Prelim. Resp. 5
`(quoting Ex. 2025)); Unified Patents has Zones focused on a particular
`industry (id. at 6); members of Unified Patents benefit by avoiding statutory
`bar and estoppel (id. at 6–7); Unified Patents requested a license from
`Bradium (id. at 7); “Unified Patents tightly Aligns its deterrent solution with
`its participating companies” including Google (one of its two founding
`members) (id. at 8 (quoting Ex. 2020)); over half of Unified Patents’ filed
`IPRs were on patents asserted against its members (id.); members of Unified
`Patents such as Google are potential licensees and had licensing dicussions
`with Bradium (id. at 9).
`In response, Petitioner argues that Patent Owner interprets AIT too
`broadly and ignores the many facts that distinguish the circumstances
`present here from those in AIT. RPI Reply 1. We agree. Patent Owner
`argues “AIT found that [RPXs business model alone] implied that ‘RPX can
`and does file IPRs to serve its clients’ financial interests, and that a key
`reason clients pay RPX is to benefit from this practice . . . .” RPI Sur-Reply
`5 (citing AIT, 897 F.3d at 1352). Nevertheless, in its Sur-Reply, Patent
`Owner did not quote the end of that sentence in which the court states “that a
`key reason clients pay RPX is to benefit from this practice in the event they
`
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`are sued by an NPE.” AIT, 897 F.3d at 1352 (emphasis added). Here,
`neither of the alleged RPIs has been sued for infringement. Thus, even if
`Petitioner operates essentially the same as RPX, AIT did not find that RPX’s
`business model, without regard to any other facts, would create a real party
`in interest relationship with the two members cited by Patent Owner.
`Analysis
`At this stage of the proceeding, and based on the facts in the current
`record, we are persuaded that Petitioner has carried its burden in complying
`with 35 U.S.C. § 312(a) and identifying all RPIs.
`We agree with Petitioner that Patent Owner has not shown that the
`facts involved here are sufficiently similar to the facts in AIT. While the
`court in AIT looked to the fact that RPX was a “for-profit company whose
`clients pay for its portfolio of ‘patent risk solutions,’” it did not end its
`analysis there. AIT, 897 F.3d at 1351. Instead, it proceeded further to
`ascertain the nature of the relationship between Salesforce, RPX and the
`specific IPRs filed, and the nature of the benefit to Salesforce from RPX’s
`IPRs. Finding extensive and specific ties between the two parties as they
`relate to the IPRs, the Federal Circuit ultimately vacated the Board’s
`decision and remanded for further proceedings to consider “the full range of
`relationships under § 315(b) and the common law that could make
`Salesforce a real party in interest.” AIT, 897 F.3d at 1358.
`We start then by analyzing the nature and degree of the relationship
`between Petitioner, the members cited by Patent Owner, and the filing of
`this IPR. As noted above, Petitioner’s business model of filing IPRs as a
`general practice to clear certain technology areas or “Zones” from non-
`practicing entity patents that are asserted in that technology area
`
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`(specifically, over half of Unified Patent’s filed IPRs were on patents
`asserted against its members (Prelim. Resp. at 8)) is similar to RPX, which is
`a for-profit company that also files IPRs to serve its members and claims its
`interests are “100% aligned” with those members. AIT, 897 F.3d at 1343,
`1352. Additionally, we consider the fact that Petitioner, by filing IPRs, may
`defray costs to individual members if they were forced to file their own
`IPRs. As Patent Owner suggests, Petitioner files IPRs to encourage
`members “to continue paying membership . . . so that Unified’s owners may
`continue to enjoy the profits derived from such fees.” Prelim. Resp. 9.
`Nevertheless, as we explained above, this business model alone is not
`enough to make any individual member an RPI. Patent Owner does not
`appear to argue that it does because it does not argue that all members of
`Petitioner are RPIs. RPI Sur-Reply 2.
`As to the relationship between the two members at issue, Petitioner,
`and the filing of this IPR, Patent Owner points to no evidence that any
`member including the two at issue desired review of the challenged patent.
`RPI Reply 1. For example, although two members have had licensing
`discussions regarding the ’239 patent (RPI Sur-Reply 3), Patent Owner has
`not filed an infringement action against any of Petitioner’s members. Thus
`no member would be time barred from filing its own IPR. RPI Reply 9.
`Patent Owner suggests that, because it previously sued Microsoft on
`the ’239 patent, licensing discussions between the two members and Patent
`Owner create an interest for Petitioner to file IPRs on behalf of those
`members and is a “clear benefit” recognized by AIT to those members for
`such a filing. RPI Sur-Reply 3. We disagree. Those members are free to
`file their own IPR and do not need Petitioner to do so for them.
`
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`Additionally, a benefit to a member from an IPR filed by Petitoiner must be
`weighed against the benefit that member receives from filing its own IPR in
`which that member can control the prior art references chosen, the counsel
`used, the amount of money spent, and whether or not to settle the case.
`In AIT, Salesforce, the purported RPI, made a payment to RPX shortly
`before the filing of the IPR, Salesforce discussed the patent and related
`litigation with RPX and a shared board member, RPX negotiated a license
`on behalf of Salesforce, and more importantly, Salesforce was time barred
`from filing its own IPR. See AIT, 897 F.3d at 1340–42. Those
`circumstances are not present in this case.
`The only arguably unmitigated benefit that Petitioner’s members incur
`is the avoidance of the estoppel implications of an IPR. See RPI Sur-Reply
`9. We do not find that avoidance of the estoppel implications of an IPR
`alone, without other facts, is sufficient to find that the two members would
`benefit from the present IPR such that they should be considered an RPI.
`Such a benefit speaks to a party being a general non-specific beneficiary,
`rather than a “clear beneficiary” under AIT (897 F.3d at 1351) and would
`apply to any entity seeking review of the ’239 patent, including members
`other than the two members cited by Patent Owner, and also to non-
`members of Petitioner.
`Similarly, Petitioner emphasizes that it does not work with its
`members to resolve their litigations; no significant payments were made
`shortly before the Petition was filed; Petitioner does not share any board
`members and has no corporate relationships with any of its members
`(beyond membership itself); there was no offer to, or request by, members
`for Petitioner to reach out to Patent Owner regarding any litigation;
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`Petitioner does not communicate with any member regarding its desires or to
`coordinate strategies, and to Petitioner’s knowledge no members have been
`threatened with litigation. RPI Reply 8–9.
`As noted above, there is no evidence that any of Petitioner’s members
`controlled, directed, or directly financed this proceeding. The members
`cited by Patent Owner have not been accused of infringing the ʼ239 Patent.
`RPI Reply 9; RPI Sur-Reply 3. There is no evidence that there was any
`communication at all between Petitioner and the two members cited by
`Patent Owner regarding filing this Petition, or that the members even knew
`beforehand of Petitioner’s intent to file this Petition. Additionally, there is
`no evidence here, as there was in AIT, of communications between Petitioner
`and any of its members regarding the underlying litigations involving the
`ʼ239 Patent. See AIT, 897 F.3d at 1340–42.
`Similarly, there is no evidence here, as there was in AIT, that the two
`members share officers or board members with Petitioner, or have any
`corporate relationships with Petitioner aside from their membership. Id.
`There also is no evidence of a “very significant payment shortly before” this
`IPR was filed. AIT, 897 F.3d at 1342. Perhaps most significantly, there is
`no evidence that any member, including the two members, desires review of
`the ʼ239 Patent but is time-barred from filing an IPR—a fact that was crucial
`in AIT. Id. at 1353 (“Given that . . . any IPR petitions Salesforce might have
`wanted to file would have been time-barred, this evidence at least suggests
`that RPX may have filed the three IPR petitions, in part, to benefit
`Salesforce.”), 1355 (“[T]he evidence submitted indicates the company’s
`understanding that the very challenges to validity included in the IPR
`petitions were challenges Salesforce would like to have made if not time-
`
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`barred from doing so.”), 1356 (no evidence contradicts “AIT’s theory that
`RPX filed IPR petitions challenging the two patents asserted in the
`Salesforce action to benefit Salesforce, where Salesforce itself was time-
`barred from filing petitions”).
`In AIT, these accumulated factors raised a concern that RPX’s actions
`appeared tailored to benefit Salesforce specifically. This, combined with the
`fact that RPX advertises itself as an “extension of a client’s in-house legal
`team,” not only demonstrated a deep and extensive tie between RPX and
`Salesforce, but also raised the issue of whether RPX was acting as an
`attorney-in-fact on behalf of Salesforce. AIT, 897 F.3d at 1357. Here, there
`is no assertion of an attorney-client relationship between Petitioner and the
`two members cited by Patent Owner. Unlike AIT, the circumstances here do
`not warrant calling this into question. There is no evidence of any member
`having had communications with Petitioner regarding any underlying
`litigation involving the ʼ239 Patent. No member has had its petitions denied.
`No member is time-barred from filing its own IPRs. Thus, the evidence
`does not point to any specific member whose ties with Petitioner are so
`extensive as to imply that Petitioner filed this IPR at the behest of that
`member or that it was acting as a proxy on behalf of that member.
`Thus, beyond the general benefit received from Petitioner’s common
`practice of filing IPRs in relevant technology areas and, as explained above,
`the mixed, at best, benefit based on the fact that the two members have had
`licensing discussions with Patent Owner, the evidence does not point to any
`further specific benefits the two members cited by Patent Owner would have
`received from Petitioner’s actions in return for the membership.
`
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`Finally, despite that fact that Patent Owner states that it does not argue
`that all of Petitioner’s members were RPIs, Patent Owner asserts that
`Petitioner’s business model itself shows that it uses willful blindness to
`represent its members, thus, making those members RPIs. RPI Sur-Reply 5–
`6. The court in AIT stated “[t]he evidence might actually indicate that RPX
`worked to ascertain, with a strong degree of confidence, its client’s desires,
`while taking last-minute efforts to avoid obtaining an express statement of
`such desires. The law has a label for this: willful blindness.” AIT, 897 F.3d
`at 1355. AIT states “two basic requirements: (1) the defendant must
`subjectively believe that there is a high probability that a fact exists and (2)
`the defendant must take deliberate actions to avoid learning of that fact.” Id.
`(in parenthetical, citation omitted)). Here, we do not find willful blindness
`applies because there is no evidence that Petitioner believed with a “high
`probability” that the two members cited by Patent Owner wished to file an
`IPR. The fact of licensing discussions between Petitioner and a member,
`without more, does not suggest with a high probability that the member
`wanted to file an IPR but rather only suggests the member was interested in
`or offered a license. Prelim Resp. 9; Ex. 2037 ¶¶ 8–9. AIT focused on the
`fact that Salesforce was barred from filing an IPR. Id. The two members
`cited by Patent Owner are not time barred.
`In sum, we find the evidence on this record demonstrates the
`relationships between the two members singled out by Patent Owner and
`Petitioner to be far less extensive than between RPX and Salesforce in AIT,
`and we agree with Petitioner that its particular members are not unnamed
`RPIs in this case. Accordingly, at this stage of the proceeding, we are
`
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`persuaded that Petitioner has carried its burden in complying with 35 U.S.C.
`§ 312(a).
`
`PRIOR AND PENDING LITIGATION
`The Petition states that the ’239 Patent and three other patents in the
`same family, U.S. Patent Nos. 7,139,794 B2 (’794 patent), 7,908,343 B2
`(’343 patent), and 8,924,506 B2 (’506 patent), are being asserted against
`Petitioner in a patent infringement lawsuit brought by Patent Owner,
`Bradium Technologies v. Microsoft, 1:15-cv-00031-RGA, dismissed
`October 18, 2017. Pet. 1–2. Petitioner states that Microsoft filed IPR2016-
`01897 challenging the ’239 patent. Id. at 2. Petitioner also identifies
`petitions for inter partes review of the related patents. Id.
`
`
`STATUTORY DISCLAIMER
`After the filing of the Petition, Patent Owner filed a statutory
`disclaimer of claims 1–19 and 21–25. Ex. 2027; see Prelim. Resp. 1.
`Patent Owner contends that “only claim 20 remains for the Board’s
`consideration here.” Id. Based on this disclaimer, the ’239 patent is to be
`treated as though claims 1–19 and 21–25 never existed. Vectra Fitness, Inc.
`v. TNWK Corp., 162 F.3d 1379, 1383 (Fed. Circ. 1998) (“This court has
`interpreted the term ‘considered as part of the original patent’ in section 253
`to mean that the patent is treated as though the disclaimed claims never
`existed.”). We also observe that our rules state that “[n]o inter partes review
`will be instituted based on disclaimed claims.” 37 C.F.R. § 42.107(e).
`In considering Federal Circuit precedent and our rules, we conclude
`that we cannot institute a trial on claims that have been disclaimed, and,
`thus, no longer exist. That conclusion is consistent with other panel
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`decisions in inter partes review proceedings that addressed nearly identical
`circumstances as we do here. See, e.g., Vestas-American Wind Tech., Inc.
`and Vestas Wind Sys. A/S v. Gen. Elec. Co., Case IPR2018-01015, Paper 9,
`12–14 (PTAB Nov. 14, 2018) (“the ’1015 IPR”). We share the same view
`as the panel in the ’1015 IPR that such a conclusion is consistent with the
`statutory scope of inter partes review as laid out in 35 U.S.C. §§ 311(b) and
`318(a), and is not at odds with the Supreme Court’s recent decision in SAS.3
`See id. Accordingly, we treat claims 1–19 and 21–25 as having never been
`part of the ’239 patent, and Petitioner cannot seek inter partes review of
`those claims.
`
`DISCRETIONARY NON-INSTITUTION UNDER 35 U.S.C. § 314
`Patent Owner asserts that “The Board should exercise its discretion
`under 35 U.S.C. §325(d) to deny Unified’s petition.” Prelimi Resp. 11. As
`background, Microsoft filed a petition (IPR2016-01897, “Microsoft
`Petition”) challenging the following claims of the ’239 patent:
`Claims
`Statutory Basis
`Challenge
`Obvious over Reddy
`1–20, 23–25
`35 U.S.C. § 103(a)
`and Hornbacker
`Obvious over Reddy,
`Hornbacker, and
`Loomans
`
`35 U.S.C. § 103(a)
`
`21, 22
`
`
`
`IPR2016-01897 (“Microsoft IPR”), Inst. Dec. 8, Paper 17. IPR2016-01897
`was terminated by settlement of the parties on October 25, 2017. IPR2016-
`
`
`3 SAS Institute, Inc. v. Iancu, 138 S. Ct. 1348 (2018) (PTAB may not
`use partial institutions) (“SAS”).
`
`
`
`15
`
`
`
`IPR2018-00952
`Patent 9,253,239 B2
`
`
`01897, Paper 31. Here, Petitioner asserts a ground of obviousness against
`claim 20 of the ’239 patent over Reddy, Hornbacker, and Rosasco.
`In the Microsoft IPR, involving an entirely different Petitioner, prior
`to SAS, we denied institution as to claim 20 at issue here, and instituted on
`all other claims. Subsequently, we terminated the proceeding as to the other
`claims before issuing a final written decision, thus those grounds were not
`fully presented to the Office. We determine that 35 U.S.C. §325(d) is not
`implicated here where the ground and the Petitioner are different than in the
`Microsoft IPR.
`Nevertheless, Patent Owner presents arguments that are relevant to
`discretionary non-institution under 35 U.S.C. § 314(a), including that
`Petitioner presented a Petition obviously copied from a prior Petition and
`used that prior Petition as a roadmap to improve and file this Petition.
`Prelim. Resp 11–14.
`Institution of inter partes review is discretionary. See 35 U.S.C.
`§ 314(a) (authorizing institution of an inter partes review under particular
`circumstances, but not requiring institution under any circumstances);
`37 C.F.R. § 42.108(a) (stating “the Board may authorize the review to
`proceed”) (emphasis added); Harmonic Inc. v. Avid Tech, Inc., 815 F.3d
`1356, 1367 (Fed. Cir. 2016) (explaining that under § 314(a), “the PTO is
`permitted, but never compelled, to institute an IPR proceeding”).
`When determining whether to exercise our discretion under § 314(a),
`we consider the following non-exhaustive factors:
`1.
`whether the same petitioner previously filed a petition directed to the
`same claims of the same patent;
`
`
`
`16
`
`
`
`IPR2018-00952
`Patent 9,253,239 B2
`
`
`whether at the time of filing of the first petition the petitioner knew of
`2.
`the prior art asserted in the second petition or should have known of it;
`3.
`whether at the time of filing of the second petition the petitioner
`already received the patent owner’s preliminary response to the first petition
`or received the Board’s decision on whether to institute review in the first
`petition;
`4.
`the length of time that elapsed between the time the petitioner learned
`of the prior art asserted in the second petition and the filing of the second
`petition;
`5.
`whether the petitioner provides adequate explanation for the time
`elapsed between the filings of multiple petitions directed to the same claims
`of the same patent;
`6.
`the finite resources of the Board; and
`7.
`the requirement under 35 U.S.C. § 316(a)(11) to issue a final
`determination not later than 1 year after the date on which the Director
`notices institution of review.
`Gen. Plastic Indus. Co. v. Canon Kabushiki Kaisha, Case IPR2016-01357,
`slip op. 15–16 (PTAB Sept. 6, 2017) (Paper 19) (precedential)4 (hereinafter,
`“General Plastic”) (citing NVIDIA Corp. v. Samsung Elec. Co., IPR2016-
`00134, slip op. 6–7 (PTAB May 4, 2016) (Paper 9)). 5
`
`
`4 General Plastic was designated precedential on October 18, 2017.
`5 These factors are “a non-exhaustive list” and “additional factors may
`arise in other cases for consideration, where appropriate.” General Plastic
`slip op at 7, 8. For example, where a subsequent petition is filed by a
`different petitioner, the Board has taken into account the following
`additional considerations, which may be relevant to determining whether to
`exercise discretion based on § 314(a): potential prejudice to the subsequent
`petitioner if institution is denied and the pending instituted proceedings
`17
`
`
`
`
`
`IPR2018-00952
`Patent 9,253,239 B2
`
`
`These General Plastic factors typically have been used to analyze
`situations in which the same party files multiple petitions challenging the
`same patent. We recognize that our discretion under 35 U.S.C. § 314(a),
`however, is not limited to situations where the same party files multiple
`petitions. While only the first General Plastic factor presumes the petitions
`are filed by the same party, other factors also rely heavily on that fact.
`Nevertheless, we analyze the General Plastic factors’ application to the facts
`and circumstances present in this case, in which a different petitioner filed a
`petition challenging a patent that had been challenged already by previous
`petitions. See, e.g., Shenzhen Silver Star Intelligent Tech. v. iRobot Corp.,
`Case IPR2018-00761, slip op. at 9–12, (dissent) 16–19 (PTAB Sept. 5,
`2018) (Paper 15) (weighing General Plastic factors for a denial of institution
`in view of an earlier challenge to the same patent by a different petitioner
`
`
`involving the first petitioner are terminated; and whether multiple petitions
`filed against same patent is a direct result of Patent Owner's litigation
`activity. See Lowes Cos. Inc., v. Nichia Corp., Case IPR2017-02011, slip
`op. 19 (PTAB March 12, 2018) (Paper 13) (“Denial of the Petition in part
`would prejudice the Petitioner in this proceeding should the Vizio Petitions
`be resolved by settlement.”); Samsung Elecs. Amer., Inc. v. Uniloc
`Luxembourg S.A., Case IPR2017-01797, slip op. 33–34 (PTAB Feb. 6,
`2018) (Paper 8) (recognizing the purpose of the availability of inter partes
`review to parties accused of infringement, and finding Patent Owner's
`complaint about multiple petitions filed to challenge the same patent
`unpersuasive “when the volume appears to be the direct result of its own
`litigation activity”). These factors, where present, generally weigh toward
`institution but do not appear to have been used to weigh against institution.
`For example
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