UNITED STATES PATENT AND TRADEMARK OFFICE
`
`______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`______________
`
`
`CISCO SYSTEMS, INC,
`Petitioner,
`
`v.
`
`CHRIMAR SYSTEMS, INC.,
`Patent Owner.
`
`______________
`
`
`Case IPR2018-01508
`Patent No. 8,155,012 B2
`
`______________
`
`
`
`
`
`PATENT OWNER’S SUR-REPLY TO ITS PRELIMINARY RESPONSE TO
`PETITION FOR INTER PARTES REVIEW UNDER 37 C.F.R. § 42.107
`
`
`
`
`
`
`
`______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`______________
`
`
`CISCO SYSTEMS, INC,
`Petitioner,
`
`v.
`
`CHRIMAR SYSTEMS, INC.,
`Patent Owner.
`
`______________
`
`
`Case IPR2018-01508
`Patent No. 8,155,012 B2
`
`______________
`
`
`
`
`
`PATENT OWNER’S SUR-REPLY TO ITS PRELIMINARY RESPONSE TO
`PETITION FOR INTER PARTES REVIEW UNDER 37 C.F.R. § 42.107
`
`
`
`
`
`
`
`Case No.: IPR2018-01508
`Patent No.: 8,155,012 B2
`
`
`
`Atty. Dkt. No.: CHRMC0118IPR
`
`Table of Authorities
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`Cases
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`Bennett Regulator Guards, Inc. v. Atlanta Gas Light Co.,
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`905 F.3d 1311 (Fed. Cir. 2018) .............................................................. 1, 2, 3
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`Click-to-Call Techs., LP v. Ingenio, Inc.,
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`899 F.3d 1321 (Fed. Cir. 2018) .......................................................... 1, 2, 3, 4
`
`Clio USA, Inc. v. The Proctor and Gamble Co.,
`
`IPR2013-00438 (P.T.A.B. Jan. 9, 2014) ......................................................... 4
`
`Noven Pharms., Inc. v. Novartis AG,
`
`IPR2014-00549, Paper 10 (PTAB Oct. 14, 2014) ........................................... 2
`
`Statutes
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`35 U.S.C. §315 .................................................................................................. 1, 2, 3
`
`Other Authorities
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`157 Cong. Rec. S1023 at S1041 (March 1, 2011) ..................................................... 1
`
`Rules
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`Fed. R. Civ. P. 3 ......................................................................................................... 1
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`i
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`Case No.: IPR2018-01508
`Patent No.: 8,155,012 B2
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`List of Exhibits
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`Atty. Dkt. No.: CHRMC0118IPR
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`Exhibit
`Description
`No.
`Petitioner’s Complaint challenging the validity of ‘012 patent claims
`2001
`2002 Order Temporarily Staying Case
`2003 Notice of Voluntary Dismissal
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`ii
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`Case No.: IPR2018-01508
`Patent No.: 8,155,012 B2
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`Atty. Dkt. No.: CHRMC0118IPR
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`Ignoring the plain language of the statute and the Federal Circuit’s directives
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`in Click-to-Call and Bennett Regulator, Cisco asserts that Congress intended the
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`filing of a civil action not bar institution of an IPR under the same set of facts where
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`serving a complaint would do so. Cisco cites no authority for that distinction. Under
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`35 U.S.C. §315(a), if a party files a civil action for a declaratory judgment of patent
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`invalidity, the Board may not institute an IPR, period. The very same legislative
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`history Cisco quotes (Reply p. 5) makes it clear that the mere filing of the complaint
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`bars IPR institution: “The present bill does coordinate inter partes and post-grant
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`review with litigation, barring use of these [inter partes and post-grant review]
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`proceedings if the challenger seeks a declaratory judgment that a patent is invalid
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`. . . .” 157 Cong. Rec. S1023 at S1041 (March 1, 2011).1 If, as Cisco asserts, this
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`passage expresses Congress’ intent, then Congress intended that the mere act of
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`seeking a declaratory judgment of patent invalidity bars institution of an IPR.
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`Contrary to Cisco’s argument, no further acts are necessary for the bar to exist.
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`Cisco’s effort to distinguish “civil action” from “complaint” is similarly
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`unavailing. The two go hand-in-hand, as Fed. R. Civ. P. 3 make clear: “A civil
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`action is commenced by filing a complaint with the court.” The PTAB has also
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`1 Throughout, all emphasis is added unless otherwise noted.
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`1
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`Case No.: IPR2018-01508
`Patent No.: 8,155,012 B2
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`confirmed that no distinction exists: “When the statute [§315(a)(1)] refers to filing
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`Atty. Dkt. No.: CHRMC0118IPR
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`a civil action, it refers to filing a complaint with a court to commence a civil action.”
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`Noven Pharms., Inc. v. Novartis AG, IPR2014-00549, Paper 10, at 6-7 (PTAB Oct.
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`14, 2014).
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`Cisco does not deny that its filing of the declaratory judgment complaint
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`triggered the bar of §315(a)(1)—i.e., it does not deny that the bar would be in effect
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`had Cisco not (more than two years later) dismissed the complaint. Cisco contends
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`that subsequent events can eliminate the bar, a contention the Federal Circuit
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`expressly rejected in Bennett Regulator (a case Cisco ignores): “We recently held
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`that serving a complaint alleging infringement—an act unchanged by the
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`complaint’s subsequent success or failure—unambiguously implicates §315(b)’s
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`time bar.” Bennett Regulator Guards, Inc. v. Atlanta Gas Light Co., 905 F.3d 1311,
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`1314-15 (Fed. Cir. 2018), citing Click-to-Call Techs., LP v. Ingenio, Inc., 899 F.3d
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`1321, 1329–32 (Fed. Cir. 2018). More pointedly, the Federal Circuit held, “The
`
`statute endorses no exceptions for dismissed complaints . . . . .” Id. at 1315. Section
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`315(a)(1) states, without exceptions, “[a]n inter partes review may not be instituted
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`if, before the date on which the petition for such a review is filed, the petitioner or
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`real party in interest filed a civil action challenging the validity of a claim of the
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`patent.” Unquestionably, Bennett Regulator’s holding applies equally to §315(a)(1)
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`because filing a civil action — “an act unchanged by the complaint’s subsequent
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`2
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`Case No.: IPR2018-01508
`Patent No.: 8,155,012 B2
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`success or failure” — unambiguously implicates §315(a)’s time bar. Bennett
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`Atty. Dkt. No.: CHRMC0118IPR
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`Regulator, 905 F.3d at 1314-15. In golf vernacular, the statute does not allow Cisco
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`to take a Mulligan.
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`Section 315(a)(1) is more stringent—not less—than §315(b) because, under
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`§315(a)(1), the mere filing of a complaint—and nothing more—is enough to activate
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`the bar. Thus, Click-to-Call and Bennett Regulator apply even more so to
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`§315(a)(1). This makes sense because, unlike the time bar of §315(b), which the
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`patent owner triggers by serving a complaint to a potentially unsuspecting
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`defendant, the challenger triggers the bar of §315(a)(1) by filing a civil action,
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`presumably after evaluating the ramifications of the statute. In Cisco’s case, its filing
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`of complaints against Chrimar’s patents was no accident: it filed declaratory
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`judgment complaints immediately after the PTO issued patents to Chrimar and left
`
`the complaints pending for more than two years.
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`Cisco cites Judge Taranto’s concurring opinion in Click-to-Call to support its
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`arguments. Cisco contends that §315(a)(1) is a preclusion statute and therefore the
`
`reasoning in Click-to-Call regarding §315(b) should not apply. (Reply at 6-7.) But
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`§315(a)(1) is no more a preclusion statute than §315(b). In both cases, if the bar
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`applies, it does not preclude the challenger from raising invalidity clams in district
`
`court. Cisco, fully aware of §315(a)(1), chose to litigate its validity claims in district
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`3
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`Case No.: IPR2018-01508
`Patent No.: 8,155,012 B2
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`court. Cisco suffers no prejudice if the Board applies the bar because Cisco can still
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`Atty. Dkt. No.: CHRMC0118IPR
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`pursue its validity claims in the district court (Cisco’s chosen forum).
`
`Cisco relies on pre-Click-to-Call PTAB decisions such as Clio USA, Inc. v.
`
`The Proctor and Gamble Co., IPR2013-00438, Paper 9 (P.T.A.B. Jan. 9, 2014)—
`
`decisions that no longer apply. Cisco ignores the Federal Circuit’s criticism that the
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`Board’s tolling decisions stood the law on its head:
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`[T]he appropriate question is whether the voluntary, without prejudice
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`dismissal of a civil action in which a complaint had been served
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`nullifies an administrative time bar that is triggered by service of that
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`complaint. It does not. Yet the Board, without explanation, extended
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`the background principle of Graves and Bonneville to conclude that
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`such a dismissal ‘nullifies the effect of the service of the complaint.’ It
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`then relied on this erroneous conclusion to ‘un-ring’ § 315(b)'s time bar.
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`In effect, the Board relied on cases holding that the voluntary dismissal
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`of an action or appeal does not toll a statute of limitations to conclude
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`that the voluntary dismissal without prejudice of a civil action does
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`indefinitely toll § 315(b) and permitted an otherwise untimely IPR to
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`proceed, turning Bonneville and Graves on their head.
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`Click-to-Call, 899 F.3d at 1335 (emphasis in original).
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`The statute is clear. The Federal Circuit cases are clear. Dismissing a
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`complaint after filing and serving it (voluntarily or otherwise) does not “un-ring” the
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`bar triggered by the filing/service of the complaint. The Board should deny Cisco’s
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`Petition.
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`4
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`Case No.: IPR2018-01508
`Patent No.: 8,155,012 B2
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`
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`Dated: January 9, 2019
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`Atty. Dkt. No.: CHRMC0118IPR
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`Respectfully submitted,
`
`
` /Christopher C. Smith/
`Frank A. Angileri (Reg. No. 36,733)
`Thomas A. Lewry (Reg. No. 30,770)
`Marc Lorelli (Reg. No. 43,759)
`Christopher C. Smith (Reg. No. 59,669)
`Brooks Kushman P.C.
`1000 Town Center, 22nd Floor
`Southfield, MI 48075
`(248) 358-4400
`
`Attorneys for Patent Owner
`
`
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`5
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`Case No.: IPR2018-01508
`Patent No.: 8,155,012 B2
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`
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`Atty. Dkt. No.: CHRMC0118IPR
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`Certificate of Service
`
`The undersigned hereby certifies that on January 9, 2019, a complete and
`entire copy of PATENT OWNER’S SUR-REPLY TO ITS PRELIMINARY
`RESPONSE TO PETITION FOR INTER PARTES REVIEW UNDER 37
`C.F.R. § 42.107, was served on all counsel listed below via electronic mail at:
`Cisco-ChriMar-IPR@kirkland.com.
`
`
`LEAD COUNSEL
`James E. Marina (Reg. No. 41,969)
`james.marina@kirkland.com
`
`Postal and Hand-Delivery Address:
`KIRKLAND & ELLIS LLP
`601 Lexington Ave.
`New York, NY 10022
`Telephone: (212) 446-4800
`Fax: (212) 446-4900
`
`
`
`
`
`BACK-UP COUNSEL
`Robert Kang (Reg. No. 59,609)
`robert.kang@kirkland.com
`
`Postal and Hand-Delivery Address:
`KIRKLAND & ELLIS LLP
`555 California Street
`San Francisco, CA 94104
`Telephone: (415) 439-1400
`Fax: (415) 439-1500
`
`Eugene Goryunov (Reg. No. 61,579)
`eugene.goryunov@kirkland.com
`
`Postal and Hand-Delivery Address:
`KIRKLAND & ELLIS LLP
`300 North LaSalle Street
`Chicago, Illinois 60654
`Telephone: (312) 862-2000
`Fax: (312) 862-2200
`
`
` /Christopher C. Smith/
`Frank A. Angileri (Reg. No. 36,733)
`Thomas A. Lewry (Reg. No. 30,770)
`Marc Lorelli (Reg. No. 43,759)
`Christopher C. Smith (Reg. No. 59,669)
`Brooks Kushman P.C.
`
`Attorneys for Patent Owner
`
`
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`6
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`Case No.: IPR2018-01508
`Patent No.: 8,155,012 B2
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`
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`Atty. Dkt. No.: CHRMC0118IPR
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`Certificate of Compliance Pursuant to 37 C.F.R. § 42.24
`
`
`
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`This paper complies with the type-volume limitation of 37 C.F.R. § 42.24.
`
`The paper contains 968 words, excluding the parts of the paper exempted by
`
`§42.24(a).
`
`This paper also complies with the typeface requirements of 37 C.F.R.
`
`§ 42.6(a)(ii) and the type style requirements of § 42.6(a)(iii)&(iv).
`
`
`Dated: January 9, 2019
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`
`
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`
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`Respectfully submitted,
`
`
` /Christopher C. Smith/
`Frank A. Angileri (Reg. No. 36,733)
`Thomas A. Lewry (Reg. No. 30,770)
`Marc Lorelli (Reg. No. 43,759)
`Christopher C. Smith (Reg. No. 59,669)
`Brooks Kushman P.C.
`1000 Town Center, 22nd Floor
`Southfield, MI 48075
`(248) 358-4400
`
`Attorneys for Patent Owner
`
`
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`7
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