Trials@uspto.gov
`571.272.7822
`
`
`
`
`
` Paper No. 27
`
` Entered: November 22, 2019
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`PAYPAL, INC.,
`UPWORK GLOBAL INC.,
`SHOPIFY, INC., SHOPIFY (USA), INC.,
`STRAVA, INC.,
`VALASSIS COMMUNICATIONS, INC.,
`RETAILMENOT, INC., and
`DOLLAR SHAVE CLUB, INC.,
`Petitioner,
`
`v.
`
`PERSONALWEB TECHNOLOGIES, LLC1
`Patent Owner.
`____________
`
`
`
`
`
`IPR2019-01111
`Patent 7,802,310 B2
`
`
`Before JONI Y. CHANG, MICHAEL R. ZECHER, and
`DAVID C. McKONE, Administrative Patent Judges.
`
`CHANG, Administrative Patent Judge.
`
`
`DECISION
`Denying Institution of Inter Partes Review
`35 U.S.C. § 314
`
`
`
`
`1 The caption of the Petition lists Level 3 Communications as a patent
`owner. Patent Owner’s Mandatory Notices indicates that PersonalWeb
`Technologies, LLC, is the patent owner, while Level 3 Communications,
`LLC, is a real party in interest. Paper 9, 1.
`
`
`
`
`571.272.7822
`
`
`
`
`
` Paper No. 27
`
` Entered: November 22, 2019
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`PAYPAL, INC.,
`UPWORK GLOBAL INC.,
`SHOPIFY, INC., SHOPIFY (USA), INC.,
`STRAVA, INC.,
`VALASSIS COMMUNICATIONS, INC.,
`RETAILMENOT, INC., and
`DOLLAR SHAVE CLUB, INC.,
`Petitioner,
`
`v.
`
`PERSONALWEB TECHNOLOGIES, LLC1
`Patent Owner.
`____________
`
`
`
`
`
`IPR2019-01111
`Patent 7,802,310 B2
`
`
`Before JONI Y. CHANG, MICHAEL R. ZECHER, and
`DAVID C. McKONE, Administrative Patent Judges.
`
`CHANG, Administrative Patent Judge.
`
`
`DECISION
`Denying Institution of Inter Partes Review
`35 U.S.C. § 314
`
`
`
`
`1 The caption of the Petition lists Level 3 Communications as a patent
`owner. Patent Owner’s Mandatory Notices indicates that PersonalWeb
`Technologies, LLC, is the patent owner, while Level 3 Communications,
`LLC, is a real party in interest. Paper 9, 1.
`
`
`
`
`
`IPR2019-01111
`Patent 7,802,310 B2
`
`I. INTRODUCTION
`On May 20, 2019, the following Petitioner Entities2 collectively filed
`a Petition requesting an inter partes review (“IPR”) of claims 20 and 69
`(“the challenged claims”) of U.S. Patent No. 7,802,310 B2 (Ex. 1001, “the
`’310 patent”): PayPal, Inc. (“PayPal”), Upwork Global Inc. (“Upwork
`Global”), Shopify, Inc. and Shopify (USA), Inc. (collectively “Shopify”),
`Strava, Inc. (“Strava”), Valassis Communications, Inc. (“Valassis”),
`RetailMeNot, Inc. (“RetailMeNot”), and Dollar Shave Club, Inc. (“Dollar
`Shave Club”). Paper 1 (“Pet.”).
`PersonalWeb Technologies, LLC (“Patent Owner”3) filed a
`Preliminary Response. Paper 14 (“Prelim. Resp.”). Patent Owner argues,
`among other things, that the Petition is time-barred under 35 U.S.C. § 315(b)
`because the district court in the related litigation found that Petitioner
`Entities are in privity with Amazon.com, Inc., and Amazon Web Services,
`Inc. (collectively “Amazon”), and Amazon was served with a complaint
`alleging infringement of the ’310 patent more than seven years prior to the
`filing of the Petition. Id. at 15−23; Ex. 2008. Pursuant to our Order
`(Paper 23), Petitioner Entities filed a Reply (Paper 24) to address whether
`Amazon is a privy of Petitioner Entities, and Patent Owner also filed a
`Sur-reply (Paper 26).
`For the reasons stated below, we determine that Amazon, a
`time-barred party, is a privy of several Petitioner Entities. As such, we deny
`the Petition, as it is time-barred under § 315(b), and we do not authorize an
`inter partes review to be instituted.
`
`2 The parties’ briefs use “Petitioners.” See, e.g., Reply 1; Sur-reply 1.
`3 The parties’ briefs use “PersonalWeb.” See, e.g., Reply 1; Sur-reply 1.
`
`2
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`IPR2019-01111
`Patent 7,802,310 B2
`
`A. Related Proceedings
`Petitioner Entities filed four other Petitions, challenging certain
`subsets of claims of U.S. Patent Nos. 6,928,442 B2 (IPR2019-01092),
`7,945,544 B2 (IPR2019-01093), and 8,099,420 B2 (IPR2019-01089 and
`IPR2019-01091). Paper 9 (Patent Owner’s Mandatory Notices), 16. The
`parties also identify other related proceedings, including those discussed
`below in the Relevant Facts section. Id. at 1−16; Pet. 2−3.
`
`B. The ’310 patent
`The ’310 patent relates to a data processing system that identifies data
`items using substantially unique identifiers, otherwise referred to as True
`Names, which depend on all of the data in the data item and only on the data
`in the data item. Ex. 1001, 1:44−48, 3:52−55, 6:20−24. According to the
`’310 Patent, the identity of a data item depends only on the data and is
`independent of the data item’s name, origin, location, address, or other
`information not derivable directly from the data associated therewith. Id. at
`3:55−58. The invention of the ’310 patent also provides that the system can
`publish data items, allowing other, possibly anonymous, systems in a
`network to gain access to the data items. Id. at 4:32−34.
`
`D. Illustrative Claim
`Both challenged claims 20 and 69 are independent. Claim 20 is
`
`illustrative and is reproduced below:
`20. A computer-implemented method operable in a system
`which includes a plurality of computers, the method comprising:
`controlling distribution of content from a first computer to at
`least one other computer, in response to a request obtained by a
`first device in the system from a second device in the system, the
`first device comprising hard ware including at least one
`processor, the request including at least a content-dependent
`
`3
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`IPR2019-01111
`Patent 7,802,310 B2
`name of a particular data item, the content-dependent name being
`based at least in part on a function of at least some of the data
`comprising the particular data item, wherein the function
`comprises a message digest function or a hash function, and
`wherein
`two identical data items will have the same
`content-dependent name,
`based at least in part on said content-dependent name of said
`particular data item, the first device (A) permitting the content to
`be provided to or accessed by the at least one other computer if
`it is not determined that the content is unauthorized or
`unlicensed, otherwise, (B) if it is determined that the content is
`unauthorized or unlicensed, not permitting the content to be
`provided to or accessed by the at least one other computer.
`Ex. 1001, 39:8–31.
`
`E. Prior Art Relied Upon
`Petitioner relies upon the references listed below. Pet. 4−5.
`
`Reference
`Name
`Francisco U.S. Patent No. 4,845,715
`Grube
`U.S. Patent No. 5,483,658
`
`
`Date
`July 4, 1989
`Jan. 9, 1996
`
`Exhibit
`1003
`1004
`
`F. The Asserted Grounds of Unpatentability
`Petitioner asserts the grounds listed below. Pet. 5.
`Claims Challenged
`35 U.S.C. §
`Reference(s)
`20, 69
`103(a)4
`Francisco
`20, 69
`103(a)
`Francisco, Grube
`
`
`4 The Leahy-Smith America Invents Act (“AIA”), which amended 35 U.S.C.
`§ 103, was signed into law in 2011. Changes to § 103 apply to applications
`filed on or after March 16, 2013. Because the ’310 patent’s filing date is
`prior to March 16, 2013, we refer to the pre-AIA version of § 103.
`
`4
`
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`IPR2019-01111
`Patent 7,802,310 B2
`
`II. ANALYSIS
`
`A. Relevant Facts
`In December of 2011, Patent Owner filed a complaint against Amazon
`and Amazon’s customer, DropBox, Inc., in the Eastern District of Texas,
`alleging infringement of one or more claims of the ’310 patent based on
`Amazon’s Simple Storage Service (“S3”), in PersonalWeb Technologies,
`LLC v. Amazon Web Services LLC, No. 6:11-cv-00658 (E.D. Tex. dismissed
`on June 9, 2014) (“the Texas Action”). Prelim. Resp. 15; Ex. 2008
`(Complaint in the Texas Action). None of Petitioner Entities was named
`expressly as defendant. Ex. 2008. In its complaint, Patent Owner alleged
`that Amazon was liable for direct and indirect infringement, and that “[f]or
`PersonalWeb’s claims of indirect infringement, Amazon’s end-user
`customers and consultants [were] direct infringers of the Patents-in-Suit,”
`including the ’310 patent. Id. at 12. The Texas Action was dismissed with
`prejudice for “all claims” in that action, including the noted infringement
`claims against Amazon and its end-user customers. Ex. 2009 (Order of
`Dismissal with Prejudice).
`In 2018, Patent Owner filed a number of lawsuits against Amazon’s
`customers, including “the eight Petitioners, alleging infringement [of the
`’310 patent] based on their use of Amazon S3.” Prelim. Resp. 15−17.
`For instance, the ’310 patent is involved in the following proceedings in the
`Northern District of California (Pet. 2, Paper 9, 1−14):
`(1) PersonalWeb Technologies, LLC v. Venmo, Inc., No. 5:18-cv-
`00177 (N.D. Cal. filed Jan. 8, 2018) (“the Venmo/PayPal
`case”)5;
`
`5 Petitioner Entities indicate that “[t]he Venmo case was refiled naming
`PayPal, Inc., as the proper defendant.” Reply 3 n.1; see also Pet. 2 (referring
`5
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`IPR2019-01111
`Patent 7,802,310 B2
`(2) PersonalWeb Technologies, LLC v. Upwork Global, Inc., No. 5-
`18-cv-05624 (N.D. Cal. filed Sept. 13, 2018) (“the Upwork
`Global case”);
`(3) PersonalWeb Technologies, LLC v. Shopify, Inc., No. 5:18-cv-
`04626 (N.D. Cal. filed July 31, 2018) (“the Shopify case”);
`(4) PersonalWeb Technologies, LLC v. Strava, Inc., No. 5:18-cv-
`04627 (N.D. Cal. filed Aug. 1, 2018) (“the Strava case”);
`(5) PersonalWeb Technologies, LLC v. Valassis Communications,
`Inc., No. 5:18-cv-05206 (N.D. Cal. filed Aug. 23, 2018)
`(“the Valassis case”);
`(6) PersonalWeb Technologies, LLC v. RetailMeNot, Inc., No. 5:18-
`cv-05966 (N.D. Cal. filed Sept. 28, 2018) (“the RetailMeNot
`case”); and
`(7) PersonalWeb Technologies, LLC v. Dollar Shave Club, No.
`5:18-cv-05373 (N.D. Cal. filed Aug. 31, 2018) (“the Dollar
`Shave Club case”). 6
`Additionally, in February of 2018, Amazon filed a declaratory
`judgment (“DJ”) action against Patent Owner, asserting non-infringement of
`the ’310 patent and “seeking to preclude infringement actions against
`Amazon’s S3 customers,” in Amazon.com, Inc. v. PersonalWeb
`Technologies, LLC, No. 5:18-cv-00767 (N.D. Cal. filed Feb. 5, 2018) (“the
`Amazon DJ Action”). Ex. 2011 (Amazon’s DJ Complaint), 1, 13–14, 17.
`Subsequently, Patent Owner amended its complaints in the customer
`cases, adding infringement allegations based on non-Amazon S3 products.
`
`
`to this case as “PersonalWeb Technologies, LLC v. PayPal, Inc.”); Prelim.
`Resp. 15 (referring to this case as suit against “Venmo/PayPal.”); Ex. 2010.
`6 These cases and other lawsuits filed by Patent Owner against Amazon’s
`customers, alleging infringement of the ’310 patent, are referred to as “the
`customer cases.” See, e.g., Ex. 2012, 3; Ex. 2013, 1.
`
`6
`
`
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`IPR2019-01111
`Patent 7,802,310 B2
`See, e.g., Ex. 1014, 1, 13−177; Ex. 1017, 2−48 (a chart on infringement
`activity categories: category 3 encompasses Amazon S3, while categories 1,
`2, and 4 do not).
`Many of the customer cases, including those involving Petitioner
`Entities, and the Amazon DJ Action were transferred and assigned to
`Multidistrict Litigation (“MDL”) as In re PersonalWeb Technologies, LLC
`et al. Patent Litigation, No. 5:18-md-02834-BLF (N.D. Cal. assigned
`June 7, 2018). Ex. 2012, 2.
`On November 28, 2018, Amazon filed a motion for summary
`judgment in the MDL proceeding, arguing that “PersonalWeb’s
`infringement claims against Amazon and its customers are barred by the
`doctrine of claim preclusion and the Supreme Court’s decision in Kessler v.
`Eldred, 206 U.S. 285 (1907).” Ex. 2014 (Amazon’s Motion for Summary
`Judgment), 1.
`On March 13, 2019, the court in the MDL proceeding issued an Order
`Granting-in-Part and Denying-in-Part Amazon’s Motion for Summary
`Judgment. Ex. 2012. In this order, the MDL court determined that “the
`defendants in the customer cases,” including Petitioner Entities, “are in
`privity with Amazon because they share the same interest in the unfettered
`use of Amazon’s web services, and Amazon adequately represented this
`interest in the Texas Action.” Id. at 14. According to the MDL court’s
`order, Amazon’s motion for summary judgment was granted with respect to
`
`
`7 Citations to Exhibit 1014 are to the page number added by Petitioner
`Entities, in the bottom, left corner of each page.
`8 Citations to Exhibit 1017 are to the page number on the top of each page,
`in blue.
`
`7
`
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`IPR2019-01111
`Patent 7,802,310 B2
`allegations involving use of S3, and Patent Owner is barred from asserting
`any infringement claim against Amazon or its customers based on use of S3.
`Id. at 26−27.
`Subsequently, in the Stipulation Re Remaining Customer Cases
`(Ex. 2013, “Stipulation”) filed in the MDL proceeding, Patent Owner and
`Amazon stipulated that the MDL court’s order “fully adjudicates all claims
`alleging patent infringement based solely on the customer’s use of Amazon
`S3” in a number of customer cases, including those involving five of
`Petitioner Entities (i.e., PayPal, Strava, Valassis, Upwork Global, and
`RetailMeNot). Id. at 3−6.
`Patent Owner appealed the MDL court’s order to the U.S. Court of
`Appeals for the Federal Circuit (“the Federal Circuit”), and Amazon filed an
`unopposed motion for leave to intervene in In re: PersonalWeb
`Technologies, LLC v. Patreon, Inc., No. 2019-1918 (Fed. Cir. filed Aug. 30,
`2019). Ex. 2017 (Patent Owner’s Appeal Brief); Ex. 2018 (Amazon’s
`Motion to Intervene).
`
`B. Principles of Law
`Section 315(b) of Title 35 of the United States Code (emphasis added)
`provides:
`(b) PATENT OWNER’S ACTION.—An inter partes review
`may not be instituted if the petition requesting the proceeding is
`filed more than 1 year after the date on which the petitioner, real
`party in interest, or privy of the petitioner is served with a
`complaint alleging
`infringement of the patent. The time
`limitation set forth in the preceding sentence shall not apply to a
`request for joinder under subsection (c).
`“[T]he IPR petitioner bears the burden of persuasion to demonstrate
`that its petitions are not time-barred under § 315(b).” Worlds Inc. v. Bungie,
`
`8
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`IPR2019-01111
`Patent 7,802,310 B2
`Inc., 903 F.3d 1237, 1242 (Fed. Cir. 2018) (addressing the burden issue in
`the context of a real party in interest analysis); see also Ventex Co. v.
`Columbia Sportswear N. Am., Inc., IPR2017-00651, Paper 148 at 4−5
`(PTAB Jan. 24, 2019) (precedential) (placing “the burden on IPR petitioners
`to demonstrate that its petitions are not time-barred under § 315(b) based on
`a complaint served on a privy more than a year before a petition is filed”).
`“The Board’s decision under § 315(b) is whether to institute or not.
`The condition precedent for this decision is whether a time-barred party
`(a party that has been served with a complaint alleging infringement of the
`patent more than one year before the IPR was filed) is the petitioner, real
`party in interest, or privy of the petitioner.” Power Integrations, Inc. v.
`Semiconductor Components Indus., LLC, 926 F.3d 1306, 1314 (Fed. Cir.
`2019) (emphases added). In the Federal Circuit’s view, the language of the
`statute makes privity and real parties in interest relationships that may arise
`“before institution relevant to the § 315(b) time-bar analysis.” Id. at 1315
`(emphasis added).
`It is not necessary to show that all of the petitioner entities are in
`privity with the time-barred party because the Federal Circuit has held that a
`petition is time-barred under § 315(b) if at least one of the petitioner entities
`is in privity with a time-barred party. Click-to-Call Techs., LP v. Ingenio,
`Inc., 899 F.3d 1321, 1338−39 (Fed. Cir. 2018) (en banc in part) (noting that
`both § 315(b) and the implementing regulation, 37 C.F.R. § 42.101(b), “treat
`a petition as if there is a single petitioner for purposes of the one-year rule”),
`cert. granted, Dex Media, Inc. v. Click-to-Call Techs., LP, 139 S. Ct. 2742
`(2019) (mem.) (granting cert. to determine whether § 314(d) permits appeal
`of the Board’s decision to institute an IPR upon finding that § 315(b)’s time
`bar did not apply).
`
`9
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`IPR2019-01111
`Patent 7,802,310 B2
`The term “privity” is not defined in the statute, but it “is a
`well-established common-law term.” WesternGeco LLC v. ION
`Geophysical Corp., 889 F.3d 1308, 1317 (Fed. Cir. 2018). “[W]hen
`Congress uses language with a settled meaning at common law, Congress
`presumably knows and adopts the cluster of ideas that were attached to each
`borrowed word in the body of learning from which it was taken.” Beck v.
`Prupis, 529 U.S. 494, 500−01 (2000); see also 154 CONG. REC. S9987 (daily
`ed. Sept. 27, 2008) (statement of Sen. Kyl) (“The concept of privity, of
`course, is borrowed from the common law of judgments.”).
`The concept of “privity” is more expansive than real parties in
`interest. Office Patent Trial Practice Guide (“Trial Practice Guide”), 77 Fed.
`Reg. 48,756, 48,759 (Aug. 14, 2012). The term “privity” is used “more
`broadly, as a way to express the conclusion that nonparty preclusion is
`appropriate on any ground.” Taylor v. Sturgell, 553 U.S. 880, 894 n.8
`(2008) (citing 18A Charles Alan Wright, Arthur R. Miller & Edward H.
`Cooper, Federal Practice and Procedure § 4449, pp. 351−53 & n.33 (2d ed.
`2002) (hereinafter “Wright & Miller”)); WesternGeco, 889 F.3d at 1318−19.
`The legislative history of the AIA endorsed the expression of “privy” as
`follows:
`The word “privy” has acquired an expanded meaning. The
`courts, in the interest of justice and to prevent expensive
`litigation, are striving to give effect to judgments by extending
`“privies” beyond the classical description. The emphasis is not
`on the concept of identity of parties, but on the practical
`situation. Privity is essentially a shorthand statement that
`collateral estoppel is to be applied in a given case; there is no
`universally applicable definition of privity. The concept refers
`to a relationship between the party to be estopped and the
`unsuccessful party in the prior litigation which is sufficiently
`
`10
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`IPR2019-01111
`Patent 7,802,310 B2
`close so as to justify application of the doctrine of collateral
`estoppel.
`154 CONG. REC. S9987 (daily ed. Sept. 27, 2008) (statement of Sen. Kyl)
`(emphases added) (citing Cal. Physicians’ Serv. v. Aoki Diabetes Research
`Inst., 163 Cal. App. 4th 1506 (Cal. App. 2008)); 157 CONG. REC. S1376
`(daily ed. Mar. 8, 2011) (incorporating prior 2008 statement).
`The Federal Circuit also has explained that, “in drafting § 315(b),
`Congress ‘chose language that bars petitions where proxies or privies would
`benefit from an instituted IPR even where the petitioning party might
`separately have its own interest in initiating an IPR.’” Power Integrations,
`926 F.3d at 1316 (second emphasis added) (quoting Applications in Internet
`Time, LLC v. RPX Corp., 897 F.3d 1336, 1347 (Fed. Cir. 2018) (“AIT”)).
`The determination of whether a time-barred party is in privity with a
`petitioner is a “highly fact-dependent question.” Trial Practice Guide, 77
`Fed. Reg. at 48,759. Importantly, “the standards for the privity inquiry must
`be grounded in due process.” WesternGeco, 889 F.3d. at 1319. “[T]he
`privity inquiry in this context naturally focuses on the relationship between
`the named IPR petitioner and the party in the prior lawsuit. For example, it
`is important to determine whether the petitioner and the prior litigant’s
`relationship—as it relates to the lawsuit—is sufficiently close that it can be
`fairly said that the petitioner had a full and fair opportunity to litigate the
`validity of the patent in that lawsuit.” Id. (emphases added).
`In Taylor, the U.S. Supreme Court identified a non-exhaustive list of
`six categories under which nonparty preclusion based on a privity
`relationship may be found: (1) an agreement between the parties to be
`bound; (2) pre-existing substantive legal relationships between the parties;
`(3) adequate representation by the named party; (4) the nonparty’s control of
`
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`IPR2019-01111
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`the prior litigation; (5) where the nonparty acts as a proxy for the named
`party to re-litigate the same issues; and (6) where special statutory schemes
`foreclose successive litigation by the nonparty (e.g., bankruptcy or probate).
`Taylor, 553 U.S. at 893−95, 893 n.6. The Supreme Court noted that this list
`of the six “established grounds for nonparty preclusion” is “meant only to
`provide a framework . . . , not to establish a definitive taxonomy.” Id. at 893
`n.6. Each ground alone is sufficient to establish privity between a nonparty
`and a named party in the prior litigation. WesternGeco, 889 F.3d at
`1319−20.
`Here, for the reasons stated below, at least the second, third, and fifth
`categories of Taylor support our determination that Amazon is a privy of
`several Petitioner Entities.
`
`C. Parties’ Contentions
`1. Patent Owner’s Arguments in Preliminary Response
`In its Preliminary Response, Patent Owner argues that the instant
`Petition is time-barred under § 315(b) because the MDL court found that
`Petitioner Entities are in privity with Amazon as to their use of S3. Prelim.
`Resp. 15−23. As support for this argument, Patent Owner notes that it filed
`a complaint against Amazon in 2011, alleging infringement of the ’310
`patent based on S3, more than seven years prior to the filing of the instant
`Petition. Exs. 2008, 2012. Patent Owner contends that Amazon is
`defending and indemnifying the defendants in the customer cases, including
`several Petitioner Entities. Prelim. Resp. 16−17 (citing Ex. 2014, 9
`(Amazon stated that it “has expressly assumed the defense of the 60
`customers who have sought Amazon’s aid, and has not turned away any
`
`12
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`IPR2019-01111
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`customer who has asked for it.”); Ex. 2015, 3−49 (Amazon admitted that it is
`indemnifying PayPal and Dollar Shave Club.); Ex. 2013, 2−6 (Amazon
`agreed that the Upwork, Shopify, Strava, Valassis, and RetailMeNot cases
`are covered by the stipulation.)).
`Patent Owner also avers that Amazon “unequivocally assert[ed] that
`its customers are its privies.” Id. at 20 (citing Ex. 2014, 8 (Amazon stated
`that “the actions involve the same parties and their privies” and that
`“PersonalWeb’s other actions in this district involve Amazon’s customers . .
`. who are Amazon’s privies.”), 9 (Amazon stated that “Amazon is in privity
`with its customer . . . [because] Amazon is indemnifying its customer.”)
`(emphases added)). Patent Owner notes that Amazon asserted that “[t]he
`interests of Amazon’s S3 customers are indisputably aligned with those of
`Amazon; they are identically interested in using the accused technology
`without the threat of molestation by PersonalWeb.” Id. (citing Ex. 2014, 8).
`According to Patent Owner, the MDL court “agree[d] with Amazon
`that the defendants in the customer cases are in privity with Amazon because
`they share the same interest in the unfettered use of Amazon’s web services,
`and Amazon adequately represented this interest in the Texas Action.”
`Prelim. Resp. 21 (quoting Ex. 2012, 14). Patent Owner notes that the MDL
`court found that “Amazon’s customer agreement has contained an
`indemnification provision since June 2017” and “Amazon agreed to
`indemnify its customer.” Id. (citing Ex. 2012, 14). Patent Owner further
`argues that Petitioner Entities “have already reaped the benefits,” in that
`“Amazon and PersonalWeb stipulated that the MDL Order ‘fully adjudicates
`
`
`9 The citations to Exhibit 2015 are to the page number on the top of each
`page, in blue.
`
`13
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`all claims alleging patent infringement based solely on the customer’s use of
`Amazon S3’ against five co-Petitioners.” Id. at 19 (citing Ex. 2013, 2−6).
`Patent Owner also avers that the MDL court’s privity determination
`comports with binding precedent and PTAB practice. Id. at 22−23. In
`Patent Owner’s view, the MDL court’s application of Ninth Circuit law is
`sufficient to establish that Amazon and Petitioner Entities are in privity
`under the Taylor framework. Id. For example, Patent Owner contends that
`the MDL court found that the indemnification agreement shows “that there
`is privity between Amazon and its customers” and that this indemnification
`shows that there were “agreements between the parties to be bound” under
`the first Taylor category, and “pre-existing substantive legal relationships”
`under the second Taylor category. Id.
`
`2. Petitioner Entities’ Reply Arguments
`In their Reply, Petitioner Entities counter that the instant Petition is
`not time-barred under § 315(b) because Amazon is not in privity with
`Petitioner Entities. Reply 1−10. Petitioner Entities argue that the MDL
`court’s finding of privity is irrelevant to this proceeding because Petitioner
`Entities “possessed unique motivations for filing this Petition that were (and
`are) wholly independent of Amazon’s dispute with PersonalWeb.” Id. at 1.
`As support for this argument, Petitioner Entities argue that the Board
`is not bound by the MDL court’s finding of privity because the MDL court
`did not examine whether Amazon was a privy under § 315(b), but instead “it
`examined under Ninth Circuit law whether privity existed to resolve a
`discrete issue of collateral estoppel.” Id. at 4. According to Petitioner,
`“courts examine privity for specific purposes, and not in a binary or absolute
`matter.” Id. at 4−5 (citing Chase Manhattan Bank, N.A. v. Celotex Corp., 56
`
`14
`
`
`
`IPR2019-01111
`Patent 7,802,310 B2
`F.3d 343, 346 (2nd Cir. 1995); Manning v. S.C. Dep’t of Highway & Pub.
`Transp., 914 F.2d 44, 48 (4th Cir. 1990)).
`Petitioner Entities also aver that the MDL court’s privity finding is
`only related to allegations involving S3. Id. at 4−5. In Petitioner Entities’
`view, the MDL court’s finding of privity is unrelated to “Petitioners’ ability
`to independently defend themselves in the PTAB due to non-S3 allegations,”
`because it involved estoppel issues resulting from the dismissal of the Texas
`Action. Id. at 5 (citing Ex. 2012, 26−27).
`Petitioner Entities further argue that Patent Owner mischaracterizes
`the record because the MDL proceeding involves both Amazon S3 and
`non-Amazon products. Id. at 1−3. Petitioner Entities note that Patent
`Owner “amended its complaints to add non-S3 allegations” and the MDL
`court found that “Amazon could not adequately represent the defendants’
`interests, as ‘a verdict against Amazon in the Amazon DJ Action may leave
`unresolved issues as to the liability of the defendants in the customer cases.”
`Id. at 1−3 (citing Exs. 1014−1018). Petitioner Entities contend that
`“Amazon moved for summary judgment only that allegations related to S3
`were barred by estoppel,” and that Patent Owner “argued in its opposition
`that Amazon’s motion did not impact its infringement allegations related to
`non-Amazon products.” Id. at 2 (citing Ex. 2014; Ex. 2019). According to
`Petitioner, the MDL “court’s finding of ‘privity . . . for the specific purpose
`of determining the preclusive effect of the first judgment’ was limited only
`to allegations related to S3.” Id. at 3 (quoting Ex. 2012, 26−2710).
`
`
`10 Although Petitioner cites to Exhibit 2012, 26–27 (Reply 3), we found this
`quote at Exhibit 2012, 15, which further quotes Transclean Corp. v. Jiffy
`Lube Int’l, Inc., 474 F.3d 1298, 1306 (Fed. Cir. 2007).
`
`15
`
`
`
`IPR2019-01111
`Patent 7,802,310 B2
`Petitioner Entities argue that none of Amazon’s motion, the MDL court’s
`order, or Patent Owner’s stipulations “affected the non-S3 infringement
`claims.” Id.
`Petitioner Entities also argue that they “never had a previous
`opportunity to challenge PersonalWeb’s patents in litigation,” as Petitioner
`Entities were not sued in the Texas Action. Id. at 5−7. In Petitioner
`Entities’ view, the fact that Amazon offered to indemnify Petitioner Entities
`does not make them privies for purposes of filing the instant Petition
`because “Amazon’s indemnity only extends to the Petitioner’s use of
`Amazon products.” Id. at 6 (citing Ex. 1021, 711). Petitioner Entities aver
`that they “are left to defend against PersonalWeb’s remaining infringement
`allegations that were untouched by the court’s order and PersonalWeb’s
`stipulation.” Id. (citing Ex. 1017). Petitioner Entities further contend that
`the primary concern of privity under § 315(b)—to “prevent successive
`challenges to a patent by those who previously have had the opportunity to
`make such challenges in prior litigation”—is inapplicable. Id. at 5−7.
`According to Petitioner, “any ‘successive challenges’ to the validity of
`PersonalWeb’s patents are self-inflicted.” Id.
`Lastly, Petitioner Entities assert that each category articulated in
`Taylor indicates a finding of no privity. Id. at 7−9. For example, as to the
`second category of Taylor, Petitioner Entities argue that “[a]ny pre-existing
`relationship is limited to Amazon products,” and that “Petitioners and
`Amazon have no pre-existing relationship relating to the infringement
`allegations remaining in PersonalWeb’s cases against the Petitioners.” Id. at
`
`
`11 The citations to Exhibit 1021 refer to the original page number on the
`bottom, center of each page.
`
`16
`
`
`
`IPR2019-01111
`Patent 7,802,310 B2
`7. Petitioner Entities further argue that “[t]he only salient relationship
`between Amazon and Petitioners relates to claims that the court barred prior
`to the filing of this Petition.” Id. (citing Ex. 2012, 26−27). With respect to
`the third category of Taylor, Petitioner Entities argue that “Amazon cannot
`adequately defend Petitioners in litigation on non-Amazon products.” Id. at
`7−8. As to the fifth category of Taylor, Petitioner Entities argue that they
`filed the Petition as a defensive measure in response to Patent Owner’s
`lawsuit against them, rather than at Amazon’s instruction. Id. at 8.
`
`3. Patent Owner’s Sur-reply Arguments
`In its Sur-reply, Patent Owner argues that Petitioner Entities’
`motivations related to the use of non-Amazon products “do not negate the
`close relationship that does exits, which stems from Petitioners’ undisputed
`use of Amazon’s products.” Sur-reply 1. Patent Owner contends that the
`real issue is “whether Petitioner and Amazon have a sufficiently close
`relationship based on the use of Amazon S3 products.” Id.
`Patent Owner also argues that the MDL court’s order “comports with
`Congressional intent, [Federal Circuit] case law, and Supreme Court
`precedent.” Id. at 3−4. Patent Owner disagrees with Petitioner Entities’
`argument that the estoppel issues, resulting from the dismissal with prejudice
`in the Texas Action, is unrelated to Petitioner Entities’ ability to
`independently defend themselves due to non-S3 allegations. Id. at 4. Patent
`Owner notes that the MDL courts found that “PersonalWeb’s indirect
`infringement accusations against ‘Amazon’s end-user customers and
`defendants’ in the Texas Action further support the conclusion that Amazon
`and its customer share the same interest in the use of S3.” Id. (quoting
`Ex. 2012, 14). Patent Owner contends that the time bar under § 315(b)
`
`17
`
`
`
`IPR2019-01111
`Patent 7,802,310 B2
`applies where “proxies or privies would benefit from an instituted IPR, even
`where the petitioning party might separately have its own interest in
`initiating an IPR.” Id. (quoting AIT, 897 F.3d at 1347).
`Patent Owner also avers that both Patent Owner and Amazon accepted
`the MDL court’s privity finding, while “Petitioners here advance positions
`contrary to what the District Court has found, and to what its
`supplier-indemnitor has told the District Court and is telling the [Federal
`Circuit].” Id. at 2. Patent Owner notes (id.) that Amazon stated in its
`motion to intervene that “[t]he judgment . . . came about only because of
`Amazon’s indemnification of S3 customers and its summary judgment
`motion.” Ex. 2018, 1212. Patent Owner further contends that “Amazon
`adequately represented Petitioners’ interests in using S3 products in the
`Texas Action where accusations against customer defendants were made,
`and Amazon continues to represent adequately Petitioners’ interests in the
`MDL and [Federal Circuit] Appeal.” Id. at 2−3.
`
`D. Privity Analysis
`Upon consideration of the parties’ arguments and evidence, we agree
`with Patent Owner that the instant Petition is time-barred under § 315(b)
`because Amazon, an undisputed time-barred party, is a privy of several
`Petitioner Entities. As we note above, demonstrating that Amazon is a privy
`of at least one Petitioner Entity is sufficient to show that Amazon is a “privy
`of the petitioner” for purposes of § 315(b). See Click-to-Call, 899 F.3d at
`1338–39.
`
`
`12 The citations of Exhibit 2018 are referring to the page number on the top
`of each page.
`
`18
`
`
`
`IPR2019-01111
`Patent 7,802,310 B2
`Notably, the MDL court found “that the defendants in the customer
`cases are in privity with Amazon because they share the same interest in the
`unfettered use of Amazon’s web services, and Amazon adequately
`represented this interest in the Texas Action.” Id. at 14. The MDL court
`also found that an indemnification
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