Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 1 of 18
`
`YAR R. CHAIKOVSKY (SBN 175421)
`yarchaikovsky@paulhastings.com
`PAUL HASTINGS LLP
`1117 S. California Avenue
`Palo Alto, California 94304
`Tel.: (650) 320-1800
`Fax: (650) 320-1900
`Naveen Modi (pro hac vice pending)
`Joseph E. Palys (pro hac vice pending)
`Igor V. Timofeyev (pro hac vice pending)
`PAUL HASTINGS LLP
`2050 M Street, N.W.
`Washington, D.C. 20036
`Tel.: (202) 551-1700
`Fax: (202) 551-1705
`Attorneys for Amicus Curiae Fitbit, Inc.
`
`UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF CALIFORNIA
`SAN JOSE DIVISION
`
`APPLE INC., INC., CISCO SYSTEMS, INC.,
`GOOGLE LLC, INTEL CORPORATION,
`EDWARDS LIFESCIENCES
`CORPORATION, and EDWARDS
`LIFESCIENCES LLC,
`
`Plaintiffs,
`
`v.
`
`ANDREI IANCU, in his official capacity as
`Under Secretary of Commerce for Intellectual
`Property and Director, United States Patent and
`Trademark Office,
`
`Defendants.
`
`CASE NO.: 20-cv-6128-EJD
`BRIEF OF AMICUS CURIAE FITBIT,
`INC. IN SUPPORT OF PLAINTIFFS’
`MOTION FOR SUMMARY
`JUDGMENT
`Date: March 11, 2021
`Time: 9:00am
`Location: Courtroom 4, 5th Floor
`Judge: Hon. Edward J. Davila
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`BRIEF OF AMICUS CURIAE FITBIT, INC.
`CASE NO.: 20-CV-6128-EJD
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`Philip Morris Products, S.A.
`Exhibit 1054
`PMP v. RAI
`IPR2020-00919
`
`Ex. 1054-001
`
`

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`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 2 of 18
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`TABLE OF CONTENTS
`
`IDENTITY AND INTEREST OF AMICUS CURIAE ................................................................... 1
`INTRODUCTION AND SUMMARY OF ARGUMENT .............................................................. 2
`BACKGROUND ............................................................................................................................. 3
`ARGUMENT ................................................................................................................................... 4
`A. The NHK-Fintiv Rule’s Authorization To Deny Institution Based on a Parallel District Court
`or ITC Proceeding Contradicts the IPR Statutory Scheme....................................................... 4
`B. The Board’s Extension of the NHK-Fintiv Rule to Parallel ITC Proceedings Illustrates the
`Rule’s Departure from the IPR Statutory Scheme .................................................................... 7
`CONCLUSION .............................................................................................................................. 11
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`BRIEF OF AMICUS CURIAE FITBIT, INC.
`CASE NO.: 20-CV-6128-EJD
`
`Ex. 1054-002
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`

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`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 3 of 18
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`
`
`TABLE OF AUTHORITIES
`
`
`
`Page(s)
`
`Cases
`
`Hyosung TNS, Inc. v. Diebold Nixdorf, Inc.,
`2019 WL 6684138 (N.D. Tex. Dec. 5, 2019) .............................................................................7
`
`Tandon Corp. v. ITC,
`831 F.2d 1017 (Fed. Cir. 1987) ...................................................................................................8
`
`Texas Instr. Inc. v. Cypress Semiconductor Corp.,
`90 F.3d 1558 (Fed. Cir. 1996) .....................................................................................................7
`
`Thryv, Inc. v. Click-To-Call Techs., LP,
`140 S. Ct. 1367 (2020) ................................................................................................................8
`
`Statutes
`
`28 U.S.C. § 1659 .........................................................................................................................9, 11
`
`35 U.S.C. § 311(b) ........................................................................................................................3, 5
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`35 U.S.C. § 313 .................................................................................................................................6
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`35 U.S.C. § 314(a) .................................................................................................................. passim
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`35 U.S.C. § 315(b) ........................................................................................................................3, 5
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`35 U.S.C. § 315(d) ............................................................................................................................5
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`35 U.S.C. § 315(e)(2) ........................................................................................................................5
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`35 U.S.C. § 317(b) (2006) .................................................................................................................5
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`35 U.S.C. § 325(d) ..................................................................................................................6, 9, 10
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`AIA § 18(b)(1) ..................................................................................................................................5
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`Administrative Decisions
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`Apple Inc. v. Fintiv, Inc.,
`IPR2020-00019, Paper 11 (P.T.A.B. Mar. 20, 2020) ....................................................... passim
`
`Bio-Rad Labs., Inc. v. 10X Genomics, Inc.,
`IPR2019-00566, Paper 21 (July 22, 2019) ..................................................................................9
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`BRIEF OF AMICUS CURIAE FITBIT, INC.
`CASE NO.: 20-CV-6128-EJD
`
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`
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`Ex. 1054-003
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`

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`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 4 of 18
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`
`
`Certain Unmanned Aerial Vehicles,
`Inv. No. 337-TA-1133, Comm’n Op.,
`2020 WL 5407477 (U.S.I.T.C. Sep. 8, 2020) .............................................................................8
`
`Garmin Int’l, Inc. & Fitbit, Inc. v. Koninklijke Philips N.V.,
`IPR2020-00754, Paper No. 11 (P.T.A.B. Oct. 27, 2020)................................................3, 4, 6, 8
`
`Intel Corp. v. Qualcomm Inc.,
`IPR2019-00128, Paper No. 9 (P.T.A.B. May 29, 2019) .............................................................9
`
`NHK Spring Co. v. Intri-Plex Techs., Inc.,
`IPR2018-00752, Paper 8 (P.T.A.B. Sept. 12, 2018) ......................................................... passim
`
`Phillip Morris Prods., S.A. v. Rai Strategic Holdings,
`IPR2020-00919, Paper 9 (P.T.A.B. Nov. 16, 2020) ...................................................................8
`
`Wirtgen Am., Inc. v. Caterpillar Paving Prods. Inc.,
`IPR2018-01201, Paper No. 13 (P.T.A.B. Jan. 8, 2019) ..............................................................9
`
`Other Authorities
`
`Jasper L. Tran, et al., Discretionary Denials of IPR Institution, 19 Chicago-Kent J.
`Intell. Prop. 251, 264 (2020) .......................................................................................................6
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`BRIEF OF AMICUS CURIAE FITBIT, INC.
`CASE NO.: 20-CV-6128-EJD
`
`Ex. 1054-004
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`

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`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 5 of 18
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`IDENTITY AND INTEREST OF AMICUS CURIAE
`Fitbit, Inc. (“Fitbit”) is a manufacturer of wearable technology devices that help people
`lead healthier, more active lives by empowering them with data, inspiration, and guidance to
`reach their goals. Fitbit designs products and experiences that track and provide motivation for
`everyday health and fitness. Fitbit’s diverse line of innovative and popular products include Fitbit
`Sense™, the Fitbit Versa™ family of smartwatches, Fitbit Charge 4™, Fitbit Inspire 2™, Fitbit
`Ace 2™ activity trackers, and Fitbit Aria Air smart scale. Fitbit products are carried in
`approximately 39,000 retail stores and in over 100 countries around the globe. The Fitbit
`platform delivers personalized experiences, insights, and guidance through leading software and
`interactive tools, including the Fitbit and Fitbit Coach apps, and Fitbit OS for smartwatches.
`As a manufacturer of innovative technological devices, Fitbit frequently must defend itself
`against infringement complaints based on patents of dubious validity. Fitbit therefore has a
`strong interest in ensuring the viability of the inter partes review (“IPR”) proceedings as a
`mechanism for expeditious adjudication of patent validity questions. Fitbit is concerned that the
`NHK-Fintiv rule significantly curtails the availability of IPRs as an avenue for challenging patent
`validity, in contravention of congressional design.
`In particular, Fitbit is concerned that the NHK-Fintiv rule leads to denial of IPR institution
`where there is a parallel proceeding before the U.S. International Trade Commission (“ITC”)—a
`federal agency charged with protecting domestic industry from unfair trade acts that has no
`authority to issue binding decisions on patent validity. In several instances, the United States
`Patent and Trademark Office (“PTO”) has denied institution of Fitbit’s IPR petitions because of a
`parallel ITC investigation, even where the decision denying institution commended Fitbit on
`promptly seeking IPR review and acknowledged the strength of Fitbit’s unpatentability challenge.
`The PTO’s claim to have discretionary denial authority under NHK-Fintiv based on a parallel ITC
`investigation further illustrates the extent to which the NHK-Fintiv rule departs from the statutory
`IPR scheme, leads to inconsistent decision-making, and limits the availability of IPRs as a
`mechanism for expeditious resolution of patent validity disputes.
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`BRIEF OF AMICUS CURIAE FITBIT, INC.
`CASE NO.: 20-CV-6128-EJD
`
`Ex. 1054-005
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`

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`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 6 of 18
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`INTRODUCTION AND SUMMARY OF ARGUMENT
`Fitbit respectfully submits this amicus curiae brief in support of Plaintiffs’ motion for
`summary judgment requesting that this Court declare unlawful the rule adopted by the PTO in
`two decisions issued by the Patent Trial and Appeal Board (“the Board”): NHK Spring Co. v.
`Intri-Plex Technologies, Inc., IPR2018-00752, Paper 8 (P.T.A.B. Sept. 12, 2018), and Apple Inc.
`v. Fintiv, Inc., IPR2020-00019, Paper 11 (P.T.A.B. Mar. 20, 2020). As Plaintiffs persuasively
`explain, the NHK-Fintiv rule, which authorizes discretionary denial of IPR institution based on
`non-statutory factors, contravenes the statutory IPR scheme, frustrates congressional objectives,
`and does not comport with the procedural requirements of the Administrative Procedure Act.
`Fitbit files this brief to illustrate further the extent to which the NHK-Fitbit rule departs from the
`statutory requirements of the IPR regime and undermines the utility of the IPRs as a mechanism
`for expeditious resolution of patent validity disputes.
`In NHK Spring, the Board announced that it has discretionary authority under 35 U.S.C.
`§ 314(a) to deny IPR institution because of a parallel court proceeding where a federal district
`court may reach the validity determination first. In Fintiv, the Board incorrectly extended that
`rule to authorize denial of institution because of the allegedly advanced stage of a parallel
`proceeding before another federal agency—the ITC. The Board did so despite conceding that the
`ITC lacks authority to invalidate a patent, and that the ITC’s invalidity rulings are not binding
`either on the PTO or on the district court. Not only does the PTO’s decision lack any support in
`the text of the IPR statute, but it also does nothing to safeguard the Board’s or the parties’
`resources—the ostensible purpose of the NHK-Fintiv rule. It contravenes congressional design
`for the PTO to decline to institute review of patent claims of dubious validity out of deference to
`an agency that had no role in the original issuance of the challenged patents, cannot provide
`preclusive relief against meritless patent assertions in district court, and has a radically different
`statutory mission from the PTO.
`The Board’s extension of the NHK-Fintiv rule to parallel ITC proceedings has
`significantly curtailed the availability of IPRs as the mechanism for challenging patents of
`questionable validity. Because an ITC investigation proceeds in accordance with a rapid and
`BRIEF OF AMICUS CURIAE FITBIT, INC.
`
`CASE NO.: 20-CV-6128-EJD
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`Ex. 1054-006
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`

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`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 7 of 18
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`strict statutory timeline and requires considerable investment of the parties’ resources at the
`outset, Fintiv’s multi-factor test for determining when denial of IPR institution is appropriate
`almost invariably tilts in favor of denying review. For instance, whereas prior to Fintiv, the
`Board had never denied IPR institution because of a parallel ITC investigation, subsequent to
`Fintiv, it denied institution in 70% of cases.
`Under Fintiv, the Board may deny institution irrespective of how promptly the petitioner
`sought IPR review, or how strong its patent challenge is on the merits. Fitbit’s own experience is
`a telling example. The Board denied institution of Fitbit’s IPR petition even though it
`“credit[ed]” Fitbit for filing its petition “within a short time (less than three months) after the ITC
`proceeding was instituted,” acknowledged the limited overlap between claims at issue in the IPR
`and in the ITC investigation (which, by the time of the Board’s decision, was a single claim), and
`found that “the merits of [Fitbit]’s asserted ground are strong.” Garmin Int’l, Inc. & Fitbit, Inc. v.
`Koninklijke Philips N.V., IPR2020-00754, Paper No. 11 at 14-16 (P.T.A.B. Oct. 27, 2020).1 This
`Court should correct the PTO’s abnegation of its statutory responsibility to institute review where
`the IPR petitioner seeks review within the statutorily prescribed period and satisfies the statutory
`requirement of demonstrating a reasonable likelihood of prevailing on the merits. See 35 U.S.C.
`§§ 314(a), 315(b).
`
`BACKGROUND
`In 2011, Congress enacted the Leahy-Smith America Invents Act (“AIA”), establishing a
`new IPR system for challenging patents of dubious validity. Under this system, a party can
`request that the PTO “cancel as unpatentable” claims of a patent that are either anticipated by, or
`obvious in view of, a prior patent or printed publication. 35 U.S.C. § 311(b). Congress vested
`the Director of the PTO with authority to institute IPR, but provided that the Director “may not
`authorize” institution unless he determines that there is “a reasonable likelihood that the petitioner
`would prevail with respect to at least 1 of the claims challenged in the petition.” Id. § 314(a).
`The Director delegated his institution authority to the Board.
`
`
`1 Fitbit’s petition for rehearing in that IPR proceeding is currently pending before the Board.
`BRIEF OF AMICUS CURIAE FITBIT, INC.
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`CASE NO.: 20-CV-6128-EJD
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`Ex. 1054-007
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`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 8 of 18
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`In 2018, the Board issued its decision in NHK Spring. There, the Board held that the
`advanced state of a parallel district court action involving a similar invalidity dispute can be the
`basis of denying IPR institution because “instituting a trial under [such] circumstances … would
`be an inefficient use of Board resources.” NHK Spring at 19-20. The Board purported to find
`authority to deny institution based on the state of a parallel district court proceeding in its
`“[d]iscretion under § 314(a).” Id. at 20.
`In 2020, the Board extended NHK Spring to situations of “a parallel … ITC investigation
`involving the challenged patent.” Fintiv at 8. While acknowledging that the PTO “would not be
`bound by the ITC’s decision” and that “ITC final invalidity determinations do not have preclusive
`effect,” the Board nevertheless opined that “an earlier ITC trial date may favor exercising
`authority to deny institution under NHK if the ITC is going to decide the same or substantially
`similar issues.” Id. at 8-9 (footnote omitted).
`Fitbit has been directly affected by the Board’s NHK-Fintiv rule. The Board denied
`institution of several of Fitbit’s IPR petitions because of parallel district court or ITC proceedings.
`In one recent instance, the Board denied institution because of a parallel ITC investigation even
`though it “credit[ed]” Fitbit for filing its petition “within a short time” after the ITC’s proceeding
`commenced, acknowledged the limited overlap between claims at issue in the two proceedings,
`and found that “the merits of [Fitbit]’s asserted ground are strong.” Garmin & Fitbit, IPR2020-
`00754, Paper No. 11 at 14-16.
`
`ARGUMENT
`The NHK-Fintiv Rule’s Authorization To Deny Institution Based on a Parallel
`District Court or ITC Proceeding Contradicts the IPR Statutory Scheme
`The PTO’s NHK-Fintiv rule lacks any statutory basis and contravenes congressional
`objectives underpinning the IPR regime. In promulgating IPRs, Congress chose a precise
`statutory scheme. See, e.g., 35 U.S.C. § 311(b) (limiting the grounds of patentability challenges);
`id. § 314(a) (requiring a determination of a reasonable likelihood of prevailing). While Congress
`was well aware of the possibility of parallel validity proceedings, see AIA § 18(b)(1) (codifying a
`petitioner’s ability to seek a stay of the district court in view of a pending covered business
`BRIEF OF AMICUS CURIAE FITBIT, INC.
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`CASE NO.: 20-CV-6128-EJD
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`A.
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`Ex. 1054-008
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`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 9 of 18
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`method review), it did not authorize the Director to deny an IPR simply because of events in a
`parallel district court or agency proceeding. In fact, Congress only authorized the Board to stay
`or terminate a pending IPR in view of other proceedings before the Patent Office. See 35 U.S.C.
`§ 315(d). By not authorizing any similar power, much less denial of institution, in light of a
`parallel district court (or ITC) action, Congress indicated the withholding of such powers.
`Moreover, Congress provided for estoppel in the district court proceedings or the ITC
`investigations based on the grounds raised in the IPR, id. § 315(e)(2), but did not provide for a
`similar estoppel based on the district court’s or the ITC’s decision on patent validity (or the
`grounds raised in those proceedings). This is in stark contrast to the pre-AIA inter partes
`reexamination scheme. See 35 U.S.C. § 317(b) (2006). That deliberate choice further indicates
`that Congress did not authorize the Board to decline its statutory responsibility of conducting
`IPRs because of parallel district court or ITC proceedings.
`Denying an IPR petition because of a parallel district court or agency action also
`undercuts section 315(b)’s one-year safe-harbor provision. That period was carefully chosen,
`over another proposal requiring IPR petitions to be filed within six months of service of a
`complaint, to provide a petitioner with “a reasonable opportunity to identify and understand the
`patent claims that are relevant to the [district court] litigation,” given the challenge of determining
`“in the first few months of the litigation which claims will be relevant and how those claims are
`alleged to read on the defendant’s products.” Cong. Rec. at S5429 (statement of Sen. Kyl).
`Section 315(b), thus, reflects Congress’ considered judgment that an IPR petition is timely if filed
`within one year from service of an infringement complaint. This statutory safe harbor becomes
`meaningless if the Board can deny timely-filed petitions on non-statutory grounds that are outside
`of a petitioner’s control—the time-to-trial practice of the jurisdiction chosen by the plaintiff and
`the tentative early schedule set by the parties, or the statutory deadlines and the pace of an ITC
`investigation. See Jasper L. Tran, et al., Discretionary Denials of IPR Institution, 19 Chicago-
`Kent J. Intell. Prop. 251, 264 (2020) (after NHK Spring, IPR petitioners “should not assume that a
`petition is timely merely because it is filed before the one-year time bar”).
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`BRIEF OF AMICUS CURIAE FITBIT, INC.
`CASE NO.: 20-CV-6128-EJD
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`Ex. 1054-009
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`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 10 of 18
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`The NHK-Fintiv rule lacks any foundation in the IPR statutory scheme. The Board
`claimed to find the source of its discretionary denial authority in section 314(a). See NHK Spring
`at 19-20; Fintiv at 2-3. But section 314(a) does not vest the Board with unbounded discretion to
`deny institution merely for reasons of administrative convenience, especially where such denial
`would prejudice the party seeking review and effectively negate a statutory provision. In fact,
`section 314(a) contains only a limitation on the Director’s institution authority, providing that the
`Director “may not authorize” institution “unless” he determines that there is “a reasonable
`likelihood that the petitioner would prevail” with respect to at least one of the challenged claims.
`35 U.S.C. § 314(a) (emphasis added). Fitbit’s own case is an example of how the NHK-Fintiv
`rule subverts this congressional command. The Board denied institution of Fitbit’s petition
`because of a parallel ITC investigation even though it expressly found that “the merits of
`[Fitbit]’s asserted ground are strong.” Garmin & Fitbit, IPR2020-00754, Paper No. 11 at 16. In
`doing so, the Board impermissibly abdicated its statutory obligation to review patents where
`petitioner has satisfied section 314(a)’s “reasonable likelihood” showing.
`Congress intended that the Director (and therefore, the Board) exercise his discretion in
`applying the enumerated statutory factors. See, e.g., 35 U.S.C. § 325(d) (providing discretion to
`deny a petition “because, the same or substantially the same prior art or arguments previously
`were presented to the Office”); see also id. at § 313 (permitting patent owner to file a preliminary
`response “that sets forth reasons why no inter partes review should be instituted based upon the
`failure of the petition to meet any requirement of this chapter”) (emphasis added). Relying on the
`state of a parallel district court or ITC proceeding in determining whether to institute IPR review
`has no basis in the statute. This Court should invalidate the erroneous NHK-Fintiv rule and
`restore Congress’ intent in setting up the IPR regime.
`
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`BRIEF OF AMICUS CURIAE FITBIT, INC.
`CASE NO.: 20-CV-6128-EJD
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`Ex. 1054-010
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`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 11 of 18
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`B.
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`The Board’s Extension of the NHK-Fintiv Rule to Parallel ITC Proceedings
`Illustrates the Rule’s Departure from the IPR Statutory Scheme
`The Board’s extension of its discretionary denial authority to parallel ITC investigations
`exemplifies the NHK-Fintiv rule’s inconsistency with the IPR statutory scheme and the rule’s
`deleterious consequences. As the Board itself acknowledged in Fintiv, the ITC lacks authority to
`invalidate a patent and its rulings on invalidity are not binding either on the Patent Office or on
`the district court. See Fintiv at 8-9 & n.13 (citing Texas Instr. Inc. v. Cypress Semiconductor
`Corp., 90 F.3d 1558 (Fed. Cir. 1996)). While Congress authorized the ITC to consider “all legal
`and equitable defenses, including patent invalidity and unenforceability,” it cautioned that “[t]he
`Commission’s findings neither purport to be, nor can they be, regarded as binding interpretations
`of the U.S. patent laws in particular factual contexts.” Texas Instr., 90 F.3d at 1568-69 (internal
`quotation marks and citation omitted). Unlike a district court ruling, an ITC decision will not
`conclusively resolve the question of a patent’s validity, and the same validity issues will need to
`be litigated in district court to obtain patent cancellation. Thus, denying institution because of a
`parallel ITC investigation will not further the “efficiency and integrity of the system,” Fintiv
`at 6—the ostensible justification of the NHK-Fintiv rule.
`The Board in Fintiv sought to justify the extension of discretionary denials to the ITC
`context by asserting that, “as a practical matter, it is difficult to maintain a district court
`proceeding on patent claims determined to be invalid at the ITC.” Id. at 8-9. For starters, the
`Board is incorrect as an empirical matter. In fact, district court proceedings often continue long
`after the ITC issues its decision on patent validity (a decision that itself is subject to appeal and
`modification by the Federal Circuit). See, e.g., Hyosung TNS, Inc. v. Diebold Nixdorf, Inc., 2019
`WL 6684138, at *1-2 (N.D. Tex. Dec. 5, 2019) (the district court litigation continuing for months
`after the ITC’s decision, which the Federal Circuit subsequently reversed). The Board’s
`reasoning is also mistaken on a more fundamental level. The Board may not abdicate its statutory
`duty to consider validity challenges where section 314(a)’s institution criteria are otherwise met
`merely because, if the ITC finds these claims to be invalid, the patent owner may have difficulty
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`BRIEF OF AMICUS CURIAE FITBIT, INC.
`CASE NO.: 20-CV-6128-EJD
`
`Ex. 1054-011
`
`

`

`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 12 of 18
`
`
`persuading a district court to reach a different conclusion. Doing so ignores Congress’ deliberate
`choice to make the ITC’s validity rulings non-binding.
`There is no statutory basis for the PTO to defer to another agency—one whose validity
`determinations lack preclusive power. The reason Congress made the ITC’s rulings on patent
`issues non-binding is because “the Commission’s primary responsibility is to administer the trade
`laws, not the patent laws.” Tandon Corp. v. ITC, 831 F.2d 1017, 1019 (Fed. Cir. 1987). The task
`of issuing patents and ensuring patent quality is the charge of the PTO, not of the ITC. It
`contravenes congressional design for the Board to defer to an agency that had no role in the
`original issuance of the challenged patents, and whose focus is protecting domestic industry from
`unfair trade acts. In fact, the ITC “recognizes the PTO’s role as the lead agency in assessing the
`patentability, or validity, of proposed or issued claims,” and has a stated policy of deferring to the
`Board’s decisions on patentability and suspending its remedial orders when the Board issues its
`final written decision or when the Board’s proceedings are sufficiently advanced. Certain
`Unmanned Aerial Vehicles, Inv. No. 337-TA-1133, Comm’n Op., 2020 WL 5407477, at *20-21
`(U.S.I.T.C. Sept. 8, 2020).
`The PTO’s extension of the NHK-Fintiv rule to pending ITC investigations curtails IPRs
`as an avenue for challenging questionable patents, in contravention of the congressional goal that
`they serve as an expeditious mechanism to improve patent quality and “to weed out bad patent
`claims efficiently.” Thryv, Inc. v. Click-To-Call Techs., LP, 140 S. Ct. 1367, 1374 (2020)
`(citations omitted). Given the ITC’s tight statutory deadlines, it may often be impossible for a
`petitioner to file its IPR petition early enough to forestall denial of institution in light of an ITC
`proceeding. Fitbit’s own experience is telling. The Board “credit[ed]” Fitbit with filing its IPR
`petition “within a short time (less than three months) after the ITC proceeding was instituted,” but
`nevertheless denied institution on the grounds that the investment of resources in the ITC
`investigation weighed against institution. Garmin & Fitbit, IPR2020-00754, Paper No. 11 at 12-
`14.
`
`Nor is that an isolated example. In Phillip Morris Prods., S.A. v. Rai Strategic Holdings,
`Inc., the Board commended “Petitioner’s diligence in filing the Petition less than one month after
`BRIEF OF AMICUS CURIAE FITBIT, INC.
`
`CASE NO.: 20-CV-6128-EJD
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`- 8 -
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`Ex. 1054-012
`
`

`

`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 13 of 18
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`Patent Owner filed its complaints in the ITC proceeding and the related district court action,” but
`then nevertheless denied institution under NHK-Fintiv. IPR2020-00919, Paper 9 at 10, 12-13
`(P.T.A.B. Nov. 16, 2020) (emphasis added). These decisions illustrate the extent to which the
`NHK-Fintiv rule subverts the congressional design. In enacting the IPR scheme, Congress did not
`intend for the PTO to take a back seat to the ITC. On the contrary, whereas Congress expressly
`required district courts to stay their proceedings for pending ITC proceedings, 28 U.S.C. § 1659,
`it imposed no such requirement on the Board.
`Because an ITC investigation must proceed rapidly, under strict statutory timelines, and
`requires considerable investment of the parties’ resources at the outset, Fintiv’s multi-factor test
`for determining when IPR institution is appropriate almost invariably leads the Board to deny
`review. A survey of the Board’s decisions demonstrates that prior to Fintiv, the Board had never
`denied IPR institution because of a parallel ITC investigation.2 Indeed, pre-Fintiv, the Board
`consistently distinguished ITC investigations from district court proceedings for the purpose of
`determining whether to exercise its discretion to deny institution under NHK. See, e.g., Intel
`Corp. v. Qualcomm Inc., IPR2019-00128, Paper No. 9 at 12-13 (P.T.A.B. May 29, 2019)
`(distinguishing ITC investigation from district court proceedings for purposes of NHK because,
`unlike district courts and the Board, ITC is not empowered to invalidate a patent or to render it
`unenforceable, and the burdens of proof and claim construction standards applied in each forum
`are different); Wirtgen Am., Inc. v. Caterpillar Paving Prods. Inc., IPR2018-01201, Paper No. 13
`at 11-12 (P.T.A.B. Jan. 8, 2019) (same). Subsequent to Fintiv, however, the Board denied
`institution in 70% of cases where a parallel ITC investigation was present.3
`
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`2 The only pre-Fintiv denial based on a parallel ITC investigation was under section 325(d)—not
`based on NHK. In fact, the Board in that case expressly refused to decide whether discretionary
`denial because of a pending ITC investigation would be proper under NHK. See Bio-Rad Labs.,
`Inc. v. 10X Genomics, Inc., IPR2019-00566, Paper 21 at 5-6 n.4 (July 22, 2019).
`3 A list of the Board’s decisions that considered whether to institute IPR despite a parallel ITC
`investigation is attached as an addendum to this amicus brief.
`BRIEF OF AMICUS CURIAE FITBIT, INC.
`
`- 9 -
`CASE NO.: 20-CV-6128-EJD
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`Ex. 1054-013
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`

`

`Case 5:20-cv-06128-EJD Document 81-1 Filed 12/23/20 Page 14 of 18
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`Board’s Institution Decisions Involving Parallel ITC Investigation Post-NHK
`
`
`Grant %
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`96.43%
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`30.43%
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`Institution
`Denied
`14
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`16
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`Denial %
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`3.57%
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`69.57%
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`Total
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`Pre-Fintiv
`Post-Fintiv
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`28
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`23
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`Institution
`Granted
`27
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`7
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`See also Addendum.
`This analysis shows that the NHK-Fintiv rule has increasingly lead the Board to deny IPR
`review, in derogation of its statutory mandate. This Court should set aside this rule—which has
`not been promulgated through any public notice-and-comment process—as contrary to the
`governing statute.
`The PTO’s extension of the NHK-Fintiv rule to parallel ITC investigations also
`demonstrates the rule’s arbitrariness and irrationality. Fintiv sets forth the standards by which the
`Board must assess whether