Trials@uspto.gov
`571-272-7822
`
`
`
`
`
`Paper 20
`Entered: October 3, 2019
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`
`
`
`ZTE (USA), INC.,
`Petitioner,
`
`v.
`
`FRACTUS S.A.,
`Patent Owner.
`____________
`
`Case IPR2018-01461
`Patent 9,054,421 B2
`____________
`
`
`
`Before PATRICK M. BOUCHER, KEVIN C. TROCK, and
`JOHN A. HUDALLA, Administrative Patent Judges.
`
`
`BOUCHER, Administrative Patent Judge.
`
`
`
`
`
`
`DECISION
`Denying Petitioner’s Request on Rehearing of
`Decision Denying Institution of Inter Partes Review
`37 C.F.R. § 42.71
`
`INTRODUCTION
`ZTE (USA) Inc. (“Petitioner”) seeks rehearing of the Decision
`Denying Institution of Inter Partes Review (Paper 10, “Decision” or “Dec.”)
`in this proceeding. Paper 11 (“Request” or “Req. Reh’g”). Patent Owner
`
`
`571-272-7822
`
`
`
`
`
`Paper 20
`Entered: October 3, 2019
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`
`
`
`ZTE (USA), INC.,
`Petitioner,
`
`v.
`
`FRACTUS S.A.,
`Patent Owner.
`____________
`
`Case IPR2018-01461
`Patent 9,054,421 B2
`____________
`
`
`
`Before PATRICK M. BOUCHER, KEVIN C. TROCK, and
`JOHN A. HUDALLA, Administrative Patent Judges.
`
`
`BOUCHER, Administrative Patent Judge.
`
`
`
`
`
`
`DECISION
`Denying Petitioner’s Request on Rehearing of
`Decision Denying Institution of Inter Partes Review
`37 C.F.R. § 42.71
`
`INTRODUCTION
`ZTE (USA) Inc. (“Petitioner”) seeks rehearing of the Decision
`Denying Institution of Inter Partes Review (Paper 10, “Decision” or “Dec.”)
`in this proceeding. Paper 11 (“Request” or “Req. Reh’g”). Patent Owner
`
`
`
`IPR2018-01461
`Patent 9,054,421 B2
`
`filed an Opposition (Paper 14, “Opposition” or “Opp.”), and Petitioner filed
`a Reply (Paper 16). The Decision denied institution of inter partes review
`pursuant to 35 U.S.C. §§ 314(a) and 325(d). After full consideration of the
`evidence and arguments presented by the parties in their briefs, the request
`for rehearing is denied.
`
`
`DISCUSSION
`The applicable standard for granting a request for rehearing of a
`petition decision is abuse of discretion. 37 C.F.R. § 42.71(c). The party
`seeking rehearing has the burden of showing the decision should be
`modified. 37 C.F.R. § 42.71(d).
`Institution of inter partes review is discretionary, not mandatory. See
`Harmonic Inc. v. Avid Tech, Inc., 815 F.3d 1356, 1357 (Fed. Cir. 2016) (“the
`PTO is permitted, but never compelled, to institute an IPR proceeding”). In
`determining whether to institute a proceeding, 35 U.S.C. § 325(d) provides
`that “the Director may take into account whether, and reject the petition or
`request because, the same or substantially the same prior art or arguments
`previously were presented to the Office.” The Board considers a number of
`nonexclusive factors in evaluating whether to exercise discretion to institute
`inter partes review where the same or substantially the same prior art or
`arguments were presented previously to the Office. See Becton, Dickinson
`& Co. v. B. Braun Melsungen AG, IPR2017-01586, Paper 8 (PTAB Dec. 15,
`2017) (precedential).
`The Director also has discretion whether to institute an inter partes
`review under 35 U.S.C. § 314(a). Cuozzo Speed Techs., LLC v. Lee, 136
`S. Ct. 2131, 2140 (2017). That discretion has been delegated to the Board.
`
`2
`
`
`
`IPR2018-01461
`Patent 9,054,421 B2
`
`See 37 C.F.R. § 42.4(a). In General Plastics Industrial Co., Ltd. v. Canon
`Kabushiki Keisha, IPR2016-01357, Paper 19 (PTAB Sept. 6, 2017)
`(precedential), the Board noted that, when “exercising discretion under 35
`U.S.C. § 314(a) . . . , we are mindful of the goals of the AIA.” General
`Plastics, slip op. at 16. There, the Board also noted that, “[a]lthough we
`recognize that an objective of the AIA is to provide an effective and efficient
`alternative to district court litigation, we also recognize the potential for
`abuse of the review process by repeated attacks on patents.” Id. at 16–17.
`Petitioner argues that we denied Petitioner an opportunity to reply to
`Patent Owner’s assertions under 35 U.S.C. § 325(d) and 35 U.S.C. § 314(a)
`in the Preliminary Response. Req. Reh’g 3. Petitioner notes the Decision
`states incorrectly that Petitioner did not seek leave to file a reply brief, but
`that prior to our Decision, Petitioner had requested authorization to file a
`reply brief, which was denied. Id. (citing Ex. 1018; Dec. 9).
`Patent Owner argues the Board correctly denied Petitioner a reply to
`the Patent Owner Preliminary Response because “Petitioner's Becton
`Dickinson factors analysis could and should have been presented in the
`Petition.” Opp. 2–4. Patent Owner argues the “Petition was filed months
`after the Becton Dickinson case was designated informative, and the Petition
`identifies all of the proceedings discussed in the Becton Dickinson analyses”
`in the Preliminary Response and the Institution Decision. Id. at 3.
`We agree that the Decision misstates that Petitioner did not seek leave
`to file a reply brief to respond directly to Patent Owner’s assertions under
`35 U.S.C. § 325(d) and 35 U.S.C. § 314(a) in the Preliminary Response.
`Petitioner did make such a request, which we considered and denied.
`
`3
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`IPR2018-01461
`Patent 9,054,421 B2
`
`Ex. 1018. As discussed herein, however, this did not materially affect our
`consideration of the instant Petition.
`
`
`A. 35 U.S.C. § 325(d)
`Petitioner contends that the Board misapprehended and unreasonably
`weighed the Becton Dickinson factors in making its Decision. Req. Reh’g
`6–13. But many of Petitioner’s arguments with respect to the Becton
`Dickinson factors restate positions or arguments already made by Petitioner
`or express Petitioner’s difference of opinion as to how to interpret the
`evidence or the weight Petitioner would accord certain evidence, none of
`which demonstrates an abuse of discretion by the Board.
`For example, the first two Becton Dickinson factors include
`(1) similarities and differences between the asserted art and the prior art
`involved during examination; and (2) the cumulative nature of the asserted
`art and the prior art evaluated during examination. Becton, Dickinson, slip
`op. at 17–18. Here, Petitioner concedes that the art asserted in the Petition,
`namely Misra I, Misra II, and Grangeat, was presented to the Office during
`examination of the subject patent. Req. Reh’g 7. But Petitioner appears to
`argue that such presentation to the Office should be discounted because
`those references “were buried in an extremely long IDS, and were never
`called out for attention by the Patent Owner or the . . . examiner.” Id.
`Although couched in the context of factors 1 and 2, Petitioner’s
`argument is not relevant to those factors, but instead implicates factors 3 (the
`extent to which the asserted art was evaluated during prior examination)
`and 4 (the extent of the overlap between the arguments made during
`examination and the manner in which a petitioner relies on the prior art or a
`
`4
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`
`
`IPR2018-01461
`Patent 9,054,421 B2
`
`patent owner distinguishes the prior art). Given that the identical references
`were indisputably presented to the Office, we do not agree that the Board
`was unreasonable in determining that factors 1 and 2 weighed in favor of
`denying institution.
`With respect to Becton Dickinson factor 3, Petitioner contends that
`“[t]here is no reasonable basis to infer that the . . . examiner evaluated any
`prior [inter partes or ex parte reexamination] filings.” Id. at 8. In advancing
`this contention, Petitioner highlights that the examiner “was not involved in
`any prior [inter partes or ex parte reexamination]” of the subject patent, the
`filings “were buried in a huge IDS, making it highly unlikely that the . . .
`examiner evaluated them,” and the reexaminations cited in Patent Owner’s
`Preliminary Response “were not submitted in any IDS” during prosecution
`of the subject patent. Id. In emphasizing these points, Petitioner focuses too
`narrowly on the specific history of the subject patent, thereby obscuring the
`relevance of related history in related patents.
`In particular, the Decision summarized aspects of that related history,
`which included explicit consideration of Misra I and II in at least related
`inter partes Reexamination Nos. 95/001,482 and 95/001,483; an explicit
`finding by the Office that “[t]here is no question of patentability raised by
`Grangeat which is new and different from that raised by Chiba”; and an
`explicit finding by the Office that “[t]here is no question of patentability
`raised by Grangeat which is new and different from that raised by Korish.”
`Dec. 12–13 (citations omitted). Petitioner criticizes the Board’s observation
`that “the written description in the respective proceedings was substantially
`the same” as the subject patent and argues that “prior art is evaluated against
`the claims, not the specification.” Req. Reh’g 10. But as noted above, the
`
`5
`
`
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`IPR2018-01461
`Patent 9,054,421 B2
`
`manner in which a petitioner relies on the prior art is considered as part of
`Becton Dickinson factor 4, not factor 3. Thus, we reasonably determined
`that factor 3 weighed in favor of denying institution.
`With respect to Becton Dickinson factor 4, Petitioner emphasizes that
`“[t]here were no arguments made during examination of the [subject
`patent’s] claims to distinguish any prior art reference,” Req. Reh’g 12, but
`this again obscures the relevance of arguments made in closely related
`proceedings. As explained in the Decision, “[t]he distinction between
`multilevel structures and groupings of single level antennas is particularly
`significant to the issues presented in this proceeding.” Dec. 14. And “this
`specific issue, in the context of the specific references presented, was
`considered by the Examiner in the related reexamination proceedings.” Id.
`The mere fact that that issue was not specifically decided in the
`context of the subject patent is not determinative. The fact remains that the
`issue was considered by the Office in a closely related proceeding involving
`a patent with substantially the same written description, with respect to the
`same prior art. Notably, Section 325(d) refers only to whether “the same or
`substantially the same prior art or arguments previously were presented to
`the Office” (emphasis added), without a further limiting requirement that
`such art and arguments were presented in specific reference to the subject
`patent. Thus, we reasonably determined that factor 4 weighed in favor of
`denying institution.
`With respect to Becton Dickinson factor 5, whether a petitioner has
`pointed out sufficiently how the Office erred in evaluating the asserted prior
`art, we noted in the Decision that we “do not discern any argument pointing
`out how the Office erred in evaluating the asserted prior art.” Dec. 15. In its
`
`6
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`
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`IPR2018-01461
`Patent 9,054,421 B2
`
`Request, Petitioner argues that “[t]he absence of prior evaluation of these
`references and [Petitioner’s submitted] expert testimony . . . renders this
`factor neutral, if not favoring institution.” Req. Reh’g 12. We disagree.
`The Petition failed to point out how the Office erred in evaluating the
`asserted prior art, and Petitioner’s argument does not render this factor
`neutral or as favoring institution.
`In the Decision, we determined that five of the Becton Dickinson
`factors weighed in favor of denying institution and one factor weighed in
`favor of granting institution. Having considered the Becton Dickinson
`factors as a whole, we determined in the Decision that the factors weighed in
`favor of denying institution. Dec. 15–16. Petitioner has not presented any
`persuasive evidence or arguments in the Request to demonstrate that our
`exercise of discretion under 35 U.S.C. § 325(d) was based on an erroneous
`interpretation of the law or on factual findings that are not supported by
`substantial evidence, represents an unreasonable judgment in weighing
`relevant factors, or misapprehended or overlooked a significant fact.
`
`
`B. 35 U.S.C. § 314(a)
`Petitioner argues that Patent Owner, in its Preliminary Response,
`“failed to mention that the case was stayed on October 4, 2018.” Req. Reh’g
`13–14. Petitioner also argues that the district court “recently reaffirmed that
`stay.” Id. at 14 (citing Ex. 1028). Petitioner further argues that the district
`court “more recently directed the parties to propose a scheduling order
`(Ex. 1029), but has not lifted the stay or set a trial date.” Id.
`Patent Owner argues that Petitioner incorrectly alleges the district
`court litigation is stayed. Opp. 1. Patent Owner advises that “on March 15,
`
`7
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`IPR2018-01461
`Patent 9,054,421 B2
`
`2019, the court issued a claim construction order reaffirming the earlier
`construction of the terms relevant to the present proceeding.” Id. (citing
`Ex. 2038, passim). Patent Owner argues that “the claim construction order
`evidences the new court’s clear intent to proceed with the case.” Id. Patent
`Owner also advises that “[o]n April 12, 2019, the parties submitted a Joint
`Notice Regarding Scheduling Conference (1) requesting a trial date
`predating any conclusion to an instituted IPR, (2) confirming that fact
`discovery has completed, and (3) requesting a close to expert discovery on
`May 31, 2019.” Id. (citing Ex. 2039, 1–3).
`The parties’ Joint Notice Regarding Scheduling Conference from the
`district court litigation appears to indicate that the case is going forward.
`See Ex. 2039. We further note that the district court has completed claim
`construction. See Ex. 2038. As such, our reasoning from the Decision
`regarding section 314(a) remains sound. See Dec. 17 (stating that we were
`“persuaded that granting institution would require the Board to consider the
`same prior art and essentially identical evidence and arguments already
`under consideration by the district court. Given these circumstances, we
`exercise our discretion under 35 U.S.C. § 314(a) to deny institution.”).
`In its Request for Rehearing, Petitioner has not presented any
`persuasive evidence or arguments to demonstrate that our exercise of
`discretion under 35 U.S.C. § 314(a) was based on an erroneous
`interpretation of the law or on factual findings that are not supported by
`substantial evidence, represents an unreasonable judgment in weighing
`relevant factors, or misapprehended or overlooked a significant fact.
`
`
`8
`
`
`
`IPR2018-01461
`Patent 9,054,421 B2
`
`
`CONCLUSION
`For the foregoing reasons, we are not persuaded that the Board abused
`its discretion under 35 U.S.C. § 325(d) or under 35 U.S.C. § 314(a) in
`declining to institute inter partes review.
`
`
`ORDER
`Accordingly, it is ORDERED that the Request for Rehearing is
`DENIED.
`
`
`
`
`
`
`
`9
`
`
`
`IPR2018-01461
`Patent 9,054,421 B2
`
`
`
`PETITIONER:
`
`James Sobieraj
`Jon Beaupre
`David Lindner
`Gang Chen
`BRINKS GILSON & LIONE
`jsobieraj@brinksgilson.com
`jbeaupre@brinksgilson.com
`dlindner@brinksgilson.com
`gchen@brinksgilson.com
`
`
`PATENT OWNER:
`
`Jason Shapiro
`Patrick Finnan
`Mark Deboy
`EDELL, SHAPIRO AND FINNAN, LLC
`js@usiplaw.com
`pjf@usiplaw.com
`mjd@usiplaw.com
`
`10
`
`
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