From:
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`Jonathan.Strang@lw.com
`Precedential_Opinion_Panel_Request
`Lauren.Rosen@lw.com; dmaiorana@jonesday.com; aminsogna@jonesday.com; kluchesi@jonesday.com;
`ggavin@jonesday.com; jrnightingale@jonesday.com; gphillips@jonesday.com; Matthew.Moore@lw.com;
`Inge.Osman@lw.com; Christopher.Henry@lw.com; Max.Grant@lw.com; Jamie.Underwood@lw.com
`Precedential Opinion Panel Request: IPR2020-00919 (USP 9,901,123)
`Thursday, July 21, 2022 11:07:17 AM
`2022.07.21 [012] 123 Petitioner"s Request for Rehearing (-00919).pdf
`
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`
`Dear Honorable Board,
`
`I write on behalf of Petitioner Philip Morris Products, S.A. (“PMP”) to request Precedential
`Opinion Panel (“POP”) Review of the Board’s decision in Philip Morris Products v. RAI
`Strategic Holdings, IPR2020-00919, Paper 9 (Nov. 16, 2020) (“Panel Decision”).
`
`Pursuant to PTAB Standard Operating Procedure 2 (Rev. 10), lead counsel for Petitioner also
`makes the following certifications:
`Based on my professional judgment, I believe the Board panel decision is
`·
`contrary to the following constitutional provision, statute, or regulation:
`Administrative Procedure Act, 5 U.S.C. § 706.
`
`· Based on my professional judgment, I believe the Panel Decision is contrary to
`the following decision(s) of the Supreme Court of the United States, the United
`States Court of Appeals for the Federal Circuit, or the precedent(s) of the
`Board:
`o Immigration and Naturalization Service v. Yang, 519 U.S. 26, (1996) (Even if
`“the agency’s discretion is unfettered at the outset, if it announces and follows
`—by rule or by settled course of adjudication—a general policy by which its
`exercise of discretion will be governed, an irrational departure from that policy
`(as opposed to an avowed alteration of it) could constitute action that must be
`overturned as ‘arbitrary, capricious, [or] an abuse of discretion” within the
`meaning of the Administrative Procedure Act.’”); McCarthy v. Merit Sys. Prot.
`Bd., 809 F.3d 1365, 1372 (Fed. Cir. 2016) (quoting Yang).
`o Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 57
`(1983) (If an agency changes course, it “must supply a reasoned analysis”
`establishing that prior policies and standards are being deliberately changed.).
`
`o Henry v. INS, 74 F.3d 1, 6 (1st Cir. 1996) (“[A]dministrative agencies must
`apply the same basic rules to all similarly situated supplicants. An agency
`cannot merely flit serendipitously from case to case, like a bee buzzing from
`flower to flower, making up the rules as it goes along.”).
`o Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 at 5 (Mar. 20, 2020)
`(precedential)
`IPR2020-00919
`Ex. 3001
`
`

`

`o Katherine K. Vidal, Interim Procedure for Discretionary Denials in AIA Post-
`Grant Proceedings with Parallel District Court Procedures, USPTO, at 2-3, 6
`(June 21, 2022) (“Director Memo”).
`
`PMP’s attached Request for Rehearing (“Request”) fully sets forth the basis of its request and
`the above certifications. Given the rare circumstances here, and for the fully explained reasons
`in the attached Request, good cause and the interests of justice warrant considering, and
`granting, PMP’s request for POP review.
`
`Briefly, PMP filed its IPR Petition less than a month after being sued. PMP followed the
`guidance in the precedential Fintiv opinion regarding a parallel district court case. And PMP
`went beyond Fintiv (in an abundance of caution) by unconditionally dropping invalidity
`defenses at the ITC to ensure an immediate and substantial reduction of duplicative work. The
`Board panel, however, impermissibly deviated from binding precedent set forth in Fintiv and
`its previous long-standing and settled practice, and denied institution based on the parallel ITC
`litigation.
`
`Regarding the Board’s previously settled course of adjudication, the Board had granted
`institution in thirty-five of thirty-six instances where there was parallel ITC litigation,
`including a half-dozen proceedings issued after Fintiv was designated precedential. Then,
`without any warning or justification, the Board changed its approach and issued a string of
`twenty denials—including the Petition at issue here—based on the existence of a co-pending
`ITC matter. And with respect to the Fintiv application to ITC cases, the Director’s Memo
`recently confirmed that the Fintiv factors do not apply, and have never applied, to parallel
`ITC cases.
`
`The adverse ramifications of the Board panel’s abuse of discretion have been severe. Not only
`did the Board’s misapprehension of Fintiv deprive PMP of proper administrative process, it
`adversely affected important public health initiatives to reduce smoking rates. The ’123 patent
`is the only not-yet-invalidated patent preventing PMP from supplying over thirty million
`American smokers with IQOS, an alternative to combustible cigarettes the U.S. Food and
`Drug Administration has deemed beneficial to public health.
`
`Granting PMP’s rehearing request and instituting review will not “open the floodgates” and
`disturb all improper institution denials based on parallel ITC actions and Fintiv
`misinterpretation. Rather, the Board should reconsider denials only under limited
`circumstances where: (i) the petitioner dropped overlapping invalidity theories from a parallel
`ITC matter; (ii) the ITC found that the petitioner infringed the patent covered in the denied
`IPR; (iii) the petitioner is subject to ITC remedial orders based on that infringement; and (iv)
`those orders ban products beneficial to public health. To PMP’s knowledge, its case is the only
`one that meets these criteria.
`
`Thus, for the reasons fully set forth in the attached Request, Petitioner PMP respectfully
`requests POP review, vacatur of the decision denying institution, and consideration of its
`Petition on the merits.
`
`Very Respectfully,
`
`Jonathan Strang
`Counsel for Petitioner
`
`

`

`
`
`Jonathan M. Strang
`
`LATHAM & WATKINS LLP
`555 Eleventh Street, NW
`Suite 1000
`Washington, D.C. 20004-1304
`Direct Dial: +1.202.637.2362
`Email: jonathan.strang@lw.com
`https://www.lw.com
`
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