Trials@uspto.gov
`571-272-7822
`
`Paper 8
`Date: January 6, 2021
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`PEAG LLC (d/b/a JLab Audio), AUDIO PARTNERSHIP LLC and AUDIO
`PARTNERSHIP PLC (d/b/a Cambridge Audio)
`Petitioner,
`
`v.
`
`VARTA MICROBATTERY GMBH,
`Patent Owner.
`____________
`
`IPR2020-01212
`Patent 9,153,835 B2
`____________
`
`Before CHRISTOPHER L. CRUMBLEY, JON B. TORNQUIST, and
`MONTÉ T. SQUIRE, Administrative Patent Judges.
`
`SQUIRE, Administrative Patent Judge.
`
`DECISION
`Granting Institution of Inter Partes Review
`35 U.S.C. § 314
`
`VARTA Ex. 2030 Page 1 of 50
`EVE Energy v. VARTA
`IPR2022-01484
`
`
`571-272-7822
`
`Paper 8
`Date: January 6, 2021
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`PEAG LLC (d/b/a JLab Audio), AUDIO PARTNERSHIP LLC and AUDIO
`PARTNERSHIP PLC (d/b/a Cambridge Audio)
`Petitioner,
`
`v.
`
`VARTA MICROBATTERY GMBH,
`Patent Owner.
`____________
`
`IPR2020-01212
`Patent 9,153,835 B2
`____________
`
`Before CHRISTOPHER L. CRUMBLEY, JON B. TORNQUIST, and
`MONTÉ T. SQUIRE, Administrative Patent Judges.
`
`SQUIRE, Administrative Patent Judge.
`
`DECISION
`Granting Institution of Inter Partes Review
`35 U.S.C. § 314
`
`VARTA Ex. 2030 Page 1 of 50
`EVE Energy v. VARTA
`IPR2022-01484
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`I. INTRODUCTION
`PEAG LLC (d/b/a JLab Audio), Audio Partnership LLC and Audio
`Partnership PLC (d/b/a Cambridge Audio) (collectively, “Petitioner”) filed a
`Petition (Paper 1, “Pet.”) requesting the Board institute an inter partes
`review of claims 1–12 of U.S. Patent No. 9,153,835 B2 (Ex. 1001, “the ’835
`patent”). Varta Microbattery GmbH (“Patent Owner”) filed a Preliminary
`Response (Paper 7, “Prelim. Resp.”). Petitioner identifies PEAG LLC (d/b/a
`JLab Audio), Audio Partnership LLC, Audio Partnership PLC (d/b/a
`Cambridge Audio), and Guangdong Mic-Power New Energy Co. Ltd., as the
`real parties-in-interest. Pet. 1. Patent Owner identifies VARTA Microbattery
`GmbH, as the real party-in-interest. Paper 5, 2.
`We have authority to determine whether to institute an inter partes
`review. See 35 U.S.C. § 314 (2018); 37 C.F.R. § 42.4(a) (2019). The
`standard for instituting an inter partes review is set forth in 35 U.S.C.
`§ 314(a), which provides that an inter partes review may not be instituted
`“unless the Director determines . . . there is a reasonable likelihood that the
`petitioner would prevail with respect to at least 1 of the claims challenged in
`the petition.”
`Having considered the Petition, Preliminary Response, and evidence
`of record, for the reasons below, we determine that the Petition shows a
`reasonable likelihood that Petitioner would prevail with respect to at least
`one of the challenged claims. Patent Owner has not persuaded us that we
`should exercise our discretion to deny institution. We thus institute inter
`partes review on all challenged claims on all asserted grounds. See SAS Inst.,
`Inc. v. Iancu, 138 S. Ct. 1348, 1354, 1359–60 (2018); see also Patent Trial
`
`2
`
`VARTA Ex. 2030 Page 2 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`and Appeal Board Consolidated Trial Practice Guide 64 (Nov. 2019) (“The
`Board will not institute on fewer than all claims or all challenges in a
`petition.”), available at https://www.uspto.gov/TrialPracticeGuideConsolidated
`(“TPG”).
`
`II. BACKGROUND
`A. Related Matters
`The parties indicate that the ’835 patent is the subject of the following
`pending consolidated district court actions: VARTA Microbattery GmbH v.
`Costco Wholesale Corporation, No. 2:20-cv-0051-JRG (E.D. Tex.); VARTA
`Microbattery GmbH v. Amazon.com, Inc., No. 2:20-cv-0052-JRG (E.D.
`Tex.); VARTA Microbattery GmbH v. Best Buy Co., Inc., No. 2:20-cv-0054-
`JRG (E.D. Tex.); VARTA Microbattery GmbH v. PEAG, LLC, No. 2:20-cv-
`0071-JRG (E.D. Tex.); VARTA Microbattery GmbH v. Audio Partnership
`LLC, et al., No. 2:20-cv-00138-JRG (E.D. Tex.); and VARTA Microbattery
`GmbH v. Samsung Electronics America, Inc., No. 2:20-cv-00029-JRG (E.D.
`Tex.) (collectively, “the District Court Action”). Pet. 1; Paper 5, 2–3; Ex.
`2002. Petitioner also filed petitions challenging claims of other patents
`asserted in the District Court Action in IPR2020-01211, IPR2020-01213,
`and IPR2020-01214. Pet. 2; Paper 5, 3.
`B. The ’835 Patent (Ex. 1001)
`The ’835 patent is titled “Button Cells and Method for Producing
`Same” and issued October 6, 2015, with claims 1–13. Ex. 1001, codes (54),
`(45), 12:1–66. The ’835 patent relates to a button cell comprising two
`housing half-parts (housing cup and housing top) separated from one another
`by an electrically insulating seal and which form a housing with a flat
`
`
`
`
`3
`
`VARTA Ex. 2030 Page 3 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`bottom area and a flat top area parallel to it, and an electrode-separator
`assembly within the housing. Id. at code (57), 1:16–24, 3:7–12.
`According to the ’835 patent, it was known in the art to have button
`cells with electrode-separator assemblies contained within the housing, but
`the prior art button cells always contained these assemblies inserted flat such
`that the electrode layers are aligned essentially parallel to the flat bottom and
`top areas of the housing. Ex. 1001, 1:43–44, 3:34–37. The ’835 patent states
`that various problems occur in button cells that contain such
`electrode-separator assemblies, including increased scrap rates due to faults
`that can occur when the assemblies make contact with one another, as well
`as the potential that the assemblies can start to leak. Id. at 1:57–59, 1:65–2:3.
`The ’835 patent states it was also known in the art to close button cells
`in a liquid-tight manner by beading the edge of the cell cup over the cell top
`and that button cells without beading cannot be loaded as heavily in the axial
`direction as compared to button cells with a beaded-over cup edge,
`especially with respect to axial mechanical loads caused in the interior of the
`button cell. Id. at 2:4–6, 2:18–23. The ’835 patent explains that the axial
`forces, which may occur, for example, as a result of volume changes during
`charging and discharging processes, can lead to leaks more readily in button
`cells without beading than in button cells with beading. Id. at 2:24–28. Thus,
`the ’835 patent indicates there was a need in the art for a button cell that is
`resistant to mechanical loads in the axial direction and manufactured without
`a beaded-over cup edge. Id. at 2:31–36.
`The ’835 patent describes a button cell, which includes a housing cup
`and a housing top separated from one another by an electrically insulating
`seal and which form a housing with a flat bottom area and a flat top area
`4
`
`
`
`VARTA Ex. 2030 Page 4 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`parallel to it, and an electrode-separator assembly within the housing,
`including at least one positive and at least one negative electrode in the form
`of flat layers and connected to one another by at least one flat separator,
`wherein the electrode layers are aligned essentially at right angles to the flat
`bottom and top areas of the housing and the button cell is manufactured
`without being beaded over. Ex. 1001, code (57), 2:40–49, 11:1–22.
`Figure 4 of the ’835 patent, reproduced below, illustrates a button cell
`according to an embodiment of the claimed invention.
`
`
`Figure 4 of the ’835 patent, above, shows button cell 400 including a
`housing comprising cup part 401 and top part 402, with seal 403 arranged
`therebetween, and an assembly of electrodes 407 and 408 and separators 405
`and 406, contained as spiral winding 404 within the housing. Id. at 11:1–9,
`Fig. 3. Figure 4 of the ’835 patent also shows button cell 400 as having top
`part 402 inserted into cup part 401 such that the casing areas of top part 402
`
`
`
`
`5
`
`VARTA Ex. 2030 Page 5 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`and cup part 401 overlap and the edge of cup part 401 is not beaded over the
`edge of top part 402.
`The ’835 patent discloses that electrode 407 is connected via output
`conductor 410 to top part 402 and electrode 408 is connected via output
`conductor 409 to cup part 402. Id. at 11:9–12. The ’835 patent further
`discloses that insulating means 411 and 412 are arranged between the end
`faces of the winding and cup part 401 and top part 402. Id. at 11:17–19.
`
`Figure 5 of the ’835 patent, reproduced below, illustrates another
`embodiment of a button cell according to the claimed invention.
`
`
`Figure 5 of the ’835 patent, above, shows button cell 500 comprising cup
`part (cell cup) 501 and top part (cell top) 502 connected to one another,
`sealed by means of seal 510, which together form a housing with flat bottom
`area 503 and flat top area 504 parallel to it. Id. at 11:23–29. The ’835 patent
`discloses that cell top 502 is inserted into cell cup 501 such that the casing
`areas of the cell top and the cell cup overlap and the edge of cell cup 501 is
`not beaded over edge 511 of cell top 502. Id. at 3:1–3, 11:32–39.
`
`
`
`
`6
`
`VARTA Ex. 2030 Page 6 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`The ’835 patent further discloses that button cell 500 contains an
`
`assembly within the housing comprising electrodes 508 and 509 and
`separators 507 in the form of a winding, whose end faces in the direction of
`flat bottom area 503 and flat top area 504 which is parallel to it. Id. at
`11:40–46. The ’835 patent also discloses that the assembly is wound up on
`winding core 512 in the center of the button cell and winding core 512 and
`the electrodes and separators wound around it are aligned at right angles to
`flat bottom and flat top areas 503 and 504. Id. at 11:46–50.
`The ’835 patent explains that if the volume of the electrodes increases
`or decreases during a charging or discharging process, the mechanical forces
`that result act predominantly radially, and can be absorbed by the casing area
`of the button cell. Ex. 1001, 11:50–54. According to the ’835 patent, because
`of the right-angled alignment of the electrodes, radial forces can be absorbed
`much better than axial forces by the housing of the button cell, which results
`in the button cell having improved sealing characteristics. Id. at 3:51–55.
`
`C. Challenged Claims
`Petitioner challenges claims 1–12 of the ’835 patent.1 Pet. 7, 8. Of the
`challenged claims, claim 1 is the only independent claim. Claim 1,
`reproduced below, is illustrative of the subject matter of the challenged
`claims:
`1. A button cell comprising:
`a housing cup and a housing top separated from one
`another by an electrically insulating seal and which form
`
`
`
` 1
`
` Claim 13 is the only claim of the ’835 patent Petitioner has not challenged
`in this Petition. Prelim. Resp. 6.
`
`
`
`7
`
`VARTA Ex. 2030 Page 7 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`
`a housing with a flat bottom area and a flat top area parallel
`to it,
`
`an electrode-separator assembly within the housing
`comprising at least one positive and at least one negative
`electrode in the form of flat layers and connected to one
`another by at least one flat separator, and
`an insulating means,
`wherein the electrode layers are aligned essentially
`at right angles to the flat bottom area and the flat top area
`and the button cell is closed without being beaded over,
`and the electrode-separator assembly is in the form of a
`spiral winding having end faces defining side surfaces of
`the spiral winding face facing in an axial direction relative
`to the flat bottom area and the flat top area, and wherein
`the insulating means is arranged between the end faces of
`the spiral winding and the housing cup and the housing
`top.
`Ex. 1001, 12:2–22.
`
`D. Evidence
`Petitioner relies on the following references in the asserted grounds of
`unpatentability:
`Name
`
`Reference
`
`Date
`
`Kaun
`
`Kobayashi
`
`JP 2007–294111
`
`Ryou
`
`EP 1886364 B1
`
`
`
`
`8
`
`US 2005/0233212 A1 Oct. 20, 2005
`(published)
`Nov. 8, 2007
`(published)
`May 24, 2006
`(filed)
`Pet. 8, 23–27. Petitioner also relies on the declaration testimony of
`William Gardner (Ex. 1003, “the Gardner Declaration”) in support of
`its contentions. Id. at 8.
`
`Exhibit
`No.
`1005
`
`1006
`
`1007
`
`VARTA Ex. 2030 Page 8 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`
`E. Asserted Grounds of Unpatentability
`Petitioner contends that the challenged claims are unpatentable based
`on the following grounds:
`Claims Challenged
`
`References/Basis
`
`35 U.S.C. §2
`
`103
`103
`103
`
`1–12
`1–12
`1–12
`
`Pet. 8.
`
`Kaun, Kobayashi
`Kobayashi, Kaun
`Kobayashi, Ryou
`
`III. ANALYSIS
`A. Discretion Under 35 U.S.C. § 325(d)
`Patent Owner argues that we should exercise our discretion under
`35 U.S.C. § 325(d) to deny institution because the Petition involves the same
`or substantially the same prior art previously presented to the Office. Prelim.
`Resp. 1, 21–22. Patent Owner contends that Petitioner relies on Kobayashi
`for each of the asserted grounds, but that Kobayashi was cited and already
`considered by the Examiner during prosecution, and Petitioner identifies no
`error by the Patent Office. Id. at 1, 21 (citing Ex. 1002, at 341, 455).3
`Patent Owner also contends that Petitioner relies on Kaun and Ryou in
`combination with Kobayashi for each of the asserted grounds, but Kaun and
`
`
`
` 2
`
` The Leahy-Smith America Invents Act (“AIA”) includes revisions to
`35 U.S.C. §§ 102, 103 that became effective on Mar. 16, 2013. Pub. L. No.
`112–29, §§ 3(b), 3(c), 3(n)(1), 125 Stat. 284, 287, 293 (2011). Because the
`application from which the ’835 patent issued was filed before Mar. 16,
`2013, we apply the pre-AIA versions of §§ 102, 103 to this Decision.
`3 For citations to Exhibit 1002, we refer and cite to the page numbers added
`to the document in the lower right side.
`9
`
`
`
`VARTA Ex. 2030 Page 9 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`Ryou are duplicative of other references considered during prosecution. Id.
`at 1–2, 21 (“Petitioners rely on Kaun and Ryou for their discussion of a
`housing that is not beaded over, but the Examiner took the position that that
`very feature was taught by Nakayama.”).
`Petitioner argues that we should not exercise our discretion to deny
`institution under § 325(d) because “Kobayashi was cited in an IDS filed on
`May 8, 2014, but was not substantively examined during prosecution.” Pet.
`31. Petitioner also argues that during prosecution the Office erred in a
`manner material to the patentability of the challenged claims. Id. at 32.
`Petitioner contends that
`[w]hile Kobayashi was cited in an IDS, . . . the Office erred
`in failing to consider Kobayashi in a manner “material to
`the patentability of the challenged claims” of the ’835
`Patent by overlooking “specific teaching[s] in the relevant
`prior art” that “impact patentability of the challenged
`claims.”
`
`Id.
`
`Section 325(d) of Title 35 of the United States Code provides, in
`relevant part: “In determining whether to institute or order a proceeding
`under this chapter, chapter 30, or chapter 31, the Director may take into
`account whether, and reject the petition or request because, the same or
`substantially the same prior art or arguments previously were presented to
`the Office.” The Board uses a two-part framework for evaluating arguments
`under § 325(d):
`1.
`whether the same or substantially the same art previously
`was presented to the Office or whether the same or
`substantially the same arguments previously were
`presented to the Office; and
`
`
`
`
`10
`
`VARTA Ex. 2030 Page 10 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`
`
`
`2.
`
`if either condition of first part of the framework is
`satisfied, whether the petitioner has demonstrated
`that the Office erred in a manner material to the
`patentability of challenged claims.
`
`
`
`Advanced Bionics, LLC v. MED-EL Elektromedizinische Geräte GmbH,
`IPR2019-01469, Paper 6 at 8 (PTAB Feb. 13, 2020) (precedential)
`(“Advanced Bionics”). “Previously presented art includes art made of record
`by the Examiner, and art provided to the Office by an applicant, such as on
`an Information Disclosure Statement (IDS), in the prosecution history of the
`challenged patent.” Id. at 7‒8. The Becton, Dickinson4 factors, which address
`discretion to deny when a petition presents the same or substantially the
`same prior art or arguments previously presented to the Office, are
`instructive. Id. at 9 (“[T]he Becton, Dickinson factors provide useful insight
`into how to apply the framework under 35 U.S.C. § 325(d).” (footnote
`omitted)).
`
`Applying the Advanced Bionics two-part framework to Patent
`Owner’s arguments, we are not persuaded the art presented in the Petition is
`the same or substantially the same as the art previously presented to the
`Office during prosecution of the ’835 patent. In particular, we are not
`persuaded the specific combinations of Kobayashi with Kaun and Ryou that
`Petitioner asserts in the Petition are the same or substantially the same art as
`the art previously presented to the Office during prosecution. See Ex. 1002,
`
`
`
` 4
`
` Becton, Dickinson & Co. v. B. Braun Melsungen AG, IPR2017-01586,
`Paper 8 (PTAB Dec. 15, 2017) (precedential as to § III.C.5, first paragraph)
`(“Becton, Dickinson”).
`
`
`
`11
`
`VARTA Ex. 2030 Page 11 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`318–324. Although Kobayashi was cited in an IDS during prosecution (Ex.
`1002, 341), the Kaun and Ryou references were never cited in any IDS or
`presented to the Office during prosecution, and are not the same or
`substantially the same as any art that was presented. See generally Ex. 1002.
`Kaun and Ryou are also not duplicative of the Nakayama reference,
`which is a different prior art reference presented to the Office during
`prosecution. Compare Ex. 1005 (Kaun) and Ex. 1007 (Ryou) with, Ex. 1015
`(Nakayama). Although Patent Owner asserts that Kaun and Ryou are
`duplicative of other references considered during prosecution (Prelim. Resp.
`1–2) and seems to imply that Petitioner applies Kaun and Ryou in the
`Petition the same way the Examiner applied Nakayama during prosecution
`(id. at 21), Patent Owner does not provide any detailed analysis or
`meaningful discussion of any overlap between the art relied upon in the
`Petition and prior art combinations presented to the Office.
`Because Patent Owner has not established that the art combinations
`Petitioner asserts in the Petition are the same or substantially the same as the
`art previously presented to the Office during prosecution, we need not
`address the second part of the Advanced Bionics framework. See Advanced
`Bionics, Paper 6 at 10.
`Even assuming that the same or substantially the same art was
`previously presented to the Office during prosecution, we determine
`Petitioner demonstrates sufficiently that the Office erred in a manner
`material to the patentability of challenged claims. In particular, Petitioner
`demonstrates that the Examiner materially erred by overlooking Kobayashi’s
`teachings, which disclose nearly all of the claim limitations, and not
`applying it in a rejection as a reference. See Advanced Bionics at 8 n.9 (“An
`12
`
`
`
`VARTA Ex. 2030 Page 12 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`example of a material error may include misapprehending or overlooking
`specific teachings of the relevant prior art where those teachings impact
`patentability of the challenged claims.”). For example, as we discuss below,
`in both the second and third asserted grounds, Petitioner relies on Kobayashi
`as a reference teaching nearly all of the claim limitations with the exception
`of “the button cell is closed without being beaded over.” Pet. 59–65, 70, 72–
`74. In contrast, during prosecution, the Examiner did not rely on Kobayashi
`as a reference in any rejection (see generally Ex. 1002), which suggests that
`the Examiner overlooked Kobayashi’s teaching of nearly all of the claim
`limitations and the impact those teachings would have on the patentability of
`the claims.
`Accordingly, we decline to exercise our discretion under 35 U.S.C.
`§ 325(d) to deny institution.
`B. Discretion Under 35 U.S.C. § 314(a)
`Patent Owner argues that we should exercise our discretion to deny
`institution based on the parallel proceeding in the District Court Action.
`Prelim. Resp. 10. Patent Owner contends
`review would be inefficient given the complete overlap in
`Petitioners’ invalidity arguments in their Petition and the
`pending lawsuits, and in view of the advanced stage and
`schedule of those lawsuits, where trial will occur seven
`months prior to any final decision that would be made by
`this Board.
`Id. at 10–11.
`Petitioner argues that we should not exercise our discretion to deny
`institution under § 314(a). Pet. 27. Petitioner contends that “the Board has
`repeatedly ruled that . . . the mere existence of parallel district court actions
`
`
`
`
`13
`
`VARTA Ex. 2030 Page 13 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`with scheduled trial dates earlier than an anticipated Final Written Decision
`is not a dispositive factor against institution” and that there is no per se rule
`against instituting an IPR in those circumstances. Id. at 27–28 (citing cases).
`Under § 314(a), the Director has discretion to deny institution of an
`inter partes review, and that discretion has been delegated to the Board. See
`37 C.F.R. § 42.4(a) (“The Board institutes the trial on behalf of the
`Director.”); Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2140 (2016)
`(“[T]he agency’s decision to deny a petition is a matter committed to the
`Patent Office’s discretion.”); SAS, 138 S. Ct. at 1356 (“[Section] 314(a)
`invests the Director with discretion on the question whether to institute
`review . . . .” (emphasis omitted)); Harmonic Inc. v. Avid Tech., Inc., 815
`F.3d 1356, 1367 (Fed. Cir. 2016) (“[T]he PTO is permitted, but never
`compelled, to institute an IPR proceeding.”).
`The Board has held that the advanced state of a parallel district court
`action is a factor that may weigh in favor of denying a petition under
`§ 314(a). See NHK Spring Co. v. Intri-Plex Techs., Inc., IPR2018-00752,
`Paper 8 at 20 (PTAB Sept. 12, 2018) (precedential); Patent Trial and Appeal
`Board Consolidated Trial Practice Guide (Nov. 2019), 58 & n.2, available at
`https://www.uspto.gov/TrialPracticeGuideConsolidated (“Trial Practice
`Guide”). We consider the following factors to assess “whether efficiency,
`fairness, and the merits support the exercise of authority to deny institution
`in view of an earlier trial date in the parallel proceeding”:
`1.
`whether the court granted a stay or evidence exists that
`one may be granted if a proceeding is instituted;
`proximity of the court’s trial date to the Board’s
`projected statutory deadline for a final written decision;
`
`2.
`
`
`
`
`14
`
`VARTA Ex. 2030 Page 14 of 50
`
`
`
`4.
`
`5.
`
`6.
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`
`3.
`
`investment in the parallel proceeding by the court and the
`parties;
`overlap between issues raised in the petition and in the
`parallel proceeding;
`whether the petitioner and the defendant in the parallel
`proceeding are the same party; and
`other circumstances that impact the Board’s exercise of
`discretion, including the merits.
`Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 at 5–6 (PTAB Mar. 20,
`2020) (precedential) (“Fintiv”). Overlap among these factors often exists and
`some facts may be relevant to more than one factor. Id. at 6. Therefore, in
`evaluating these factors, we “take[] a holistic view of whether efficiency and
`integrity of the system are best served by denying or instituting review.” Id.
`at 6. We address each of these factors in turn below.
`1. Whether the Court Granted a Stay or Evidence Exists That a Stay
`may be Granted if a Proceeding is Instituted
`In considering the first Fintiv factor, the Fintiv panel noted that the
`existence of a district court stay pending Board resolution of an inter partes
`review has weighed strongly against discretionary denial, while a denial of
`such a stay request sometimes weighs in favor of discretionary denial.
`Fintiv, Paper 11 at 6–8.
`Patent Owner notes that Petitioner filed a motion to stay the District
`Court Action on August 20, 2020 and the court denied that motion on
`October 7, 2020. Prelim. Resp. 12 (citing Ex. 2005 (motion to stay); Ex.
`2007 (order on motion to stay)). Patent Owner argues that, even if the Board
`were to proceed with institution of this IPR and Petitioner were to renew its
`
`
`
`
`15
`
`VARTA Ex. 2030 Page 15 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`motion to stay the District Court Action, that motion would also likely be
`denied. Id.
`We disagree that this factor weighs against institution here. Although
`the district court previously denied Petitioner’s motion to stay, in reviewing
`the stay order, the district court indicated that the motion was “premature . . .
`in advance of the PTAB’s decision on whether or not to grant the petition for
`inter partes review” and denied without prejudice to renew. Ex. 2007, 3. The
`order on Petitioner’s motion to stay expressly provides that Petitioner is
`permitted to refile its motion to stay “within 14 days following the PTAB’s
`institution decision,” which evidences the district court’s willingness to
`revisit the issue and reconsider whether to grant a stay. Id. The fact that the
`court has expressed willingness to reconsider whether to grant a stay
`following our decision to institute generally weighs against exercising
`discretion to deny institution. Fintiv, Paper 11 at 7 (explaining that where
`“the court has denied a motion to stay without prejudice and indicated to the
`parties that it will consider a renewed motion or reconsider a motion to stay
`if a PTAB trial is instituted . . . [t]his fact has usually weighed against
`exercising authority to deny institution under NHK”).
`Patent Owner argues that the specific facts of the copending District
`Court Action make a stay less likely, noting that there is a “heightened
`prejudice” that would be caused by a stay due to Petitioner’s continued
`importation of the allegedly infringing products. Prelim. Resp. 12–13.
`According to Patent Owner, the Eastern District of Texas has denied a stay
`in an unrelated case, even after institution of an inter partes review, when
`there was a risk of heightened prejudice. Id. at 13 (citing Peloton Interactive,
`Inc. v. Flywheel Sports, Inc., 2:18-cv-030390, 2019 WL 3826051, at *3
`16
`
`
`
`VARTA Ex. 2030 Page 16 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`(E.D. Tex. Aug. 14, 2019)). But there are also other facts present in the
`District Court Action that increase the likelihood of a stay being granted,
`based on the court’s past practices. For example, we note the early stage of
`the litigation and the fact that the court has not issued a claim construction
`ruling, facts which have been found to weigh in favor of a stay. See Uniloc
`USA, Inc. v. Google, LLC, No. 2-17-cv-00231, Dkt. 47, 2 (E.D. Tex. Oct. 3,
`2017) (granting stay where “[n]o patent claims have been construed by the
`Court in these cases and discovery has barely begun.”). Taken together, the
`facts of the District Court Action generally counterbalance one another, and
`do not make the grant of a stay significantly more or less likely.
`
`Accordingly, the balance of the evidence on the first Fintiv factor
`neither weighs in favor of nor against exercising discretion to deny
`institution.
`
`2. Proximity of Trial Date
`The parties agree that the trial date of the District Court Action is
`currently scheduled for June 7, 2021 (Pet. 29; Prelim. Resp. 13), which is
`seven months before the statutory date for the final written decision.
`When a district court’s trial date will occur before the projected
`statutory deadline, the Board generally weighs this second Fintiv factor in
`favor of exercising authority to deny institution under § 314(a). Fintiv, Paper
`11 at 9.
`Accordingly, the second Fintiv factor weighs in favor of exercising
`discretion to deny institution.
`3. Investment in the Parallel Proceeding
`Patent Owner argues that this factor favors denial because of the
`advanced stage and schedule of the District Court Action relative to this
`17
`
`
`
`VARTA Ex. 2030 Page 17 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`proceeding. Prelim. Resp. 10–11. Patent Owner contends it has served
`infringement contentions, Petitioner has served invalidity contentions, and
`both parties have produced documents and propounded and responded to
`interrogatories. Id. at 15. Patent Owner further contends the parties have
`exchanged proposed terms and identified evidence upon which they intend
`to rely for claim construction, and that the claim construction hearing is
`scheduled for January 15, 2021. Id. at 15–16 (citing Ex. 2004, 4–5). Patent
`Owner also contends fact discovery is scheduled to close on January 29,
`2021 and trial is scheduled to begin on June 7, 2021. Id. at 16 (citing
`Ex. 2004, 1, 3, 4). Patent Owner asserts that the “court’s claim construction
`decision is expected to follow shortly after the institution decision and . . .
`trial will likely be completed seven months before any final written decision
`even if institution were to occur.” Id.
`Petitioner contends that this Fintiv factor weighs against discretionary
`denial because the “district court proceeding is still at its infancy” and
`“Petitioner has worked diligently to file the subject petition approximately
`eight months before the statutory bar date.” Pet. 30.
`In considering this third Fintiv factor, the Board’s precedential Fintiv
`order provides the following guidance:
`[I]f, at the time of the institution decision, the district court
`has issued substantive orders related to the patent at issue
`in the petition, this fact favors denial.[] Likewise, district
`court claim construction orders may indicate that the court
`and parties have invested sufficient time in the parallel
`proceeding to favor denial. If, at the time of the institution
`decision, the district court has not issued orders related to
`the patent at issue in the petition, this fact weighs against
`exercising discretion to deny institution under NHK.
`
`
`
`
`18
`
`VARTA Ex. 2030 Page 18 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`Fintiv, Paper 11 at 9–10 (footnote omitted).
`There is no evidence that the district court has issued any substantive
`orders related to the ’835 patent. Although the parties in the District Court
`Action have completed some work, for example, served preliminary
`infringement and invalidity contentions, responded to each other’s requests
`for documents and interrogatories, and exchanged proposed terms for claim
`construction, discovery is not over and much remains to be completed in
`advance of trial. See Ex. 2004, 1–4. The claim construction hearing has not
`yet occurred and it is scheduled for January 15, 2021, and the district court
`has not issued any claim construction orders. Id. at 4. The close of fact
`discovery is not currently scheduled to be completed until January 29, 2021
`and expert discovery is not currently scheduled to be completed until March
`12, 2021. Id. at 3. There is also no evidence that the parties have submitted
`briefing on any dispositive issue, or that the district court has made any
`determination on the merits. Thus, the evidence shows that the investment in
`the parallel proceeding related to the validity issue is minimal. This fact
`weighs in favor of not exercising discretion to deny institution.
`In considering the court’s and the parties’ investment in the parallel
`proceeding to date, the panel in Fintiv further provides that a petitioner’s
`diligence or delay in filing a petition may be relevant. Fintiv, Paper 11 at
`11–12. If the evidence shows that a petitioner filed its petition expeditiously,
`such as promptly after becoming aware of the claims being asserted, this fact
`has weighed against denying institution. Id. at 11 (citing Intel Corp. v. VLSI
`Tech. LLC, IPR2019-01192, Paper 15 at 12–13 (PTAB Jan. 9, 2020);
`Illumina Inc. v. Natera, Inc., IPR2019-01201, Paper 19 at 8 (PTAB Dec. 18,
`2019)). If, however, the evidence shows the petitioner did not file its petition
`19
`
`
`
`VARTA Ex. 2030 Page 19 of 50
`
`
`
`IPR2020-01212
`Patent 9,153,835 B2
`
`
`expeditiously, such facts have favored denial. Id. at 11–12 (citing Next
`Caller, Inc. v TRUSTID, Inc., IPR2019-00961, Paper 10 at 16 (PTAB Oct.
`16, 2019)). In considering this factor, Petitioner’s diligence in filing the
`Petition also weighs in favor of not exercising discretion to deny institution.
`In particular, the evidence shows Petitioner acted expeditiously by filing this
`Petition approximately eight months before the allotted twelve-month
`statutory bar date. Pet. 30.
`Accordingly, based on the minimal investment in the parallel
`proceeding and the Petitioner’s diligence in filing the Petition, the third
`Fintiv factor weighs strongly in favor of not exercising discretion to deny
`institution.
`
`4. Overlap of Issues
`The fourth Fintiv factor evaluates “concerns of
Accessing this document will incur an additional charge of $.
After purchase, you can access this document again without charge.
Accept $ Charge
Still Working On It
This document is taking longer than usual to download. This can happen if we need to contact the court directly to obtain the document and their servers are running slowly.
Give it another minute or two to complete, and then try the refresh button.
A few More Minutes ... Still Working
It can take up to 5 minutes for us to download a document if the court servers are running slowly.
Thank you for your continued patience.
This document could not be displayed.
We could not find this document within its docket. Please go back to the docket page and check the link. If that does not work, go back to the docket and refresh it to pull the newest information.
Your account does not support viewing this document.
You need a Paid Account to view this document. Click here to change your account type.
Your account does not support viewing this document.
Set your membership
status to view this document.
With a Docket Alarm membership, you'll
get a whole lot more, including:
- Up-to-date information for this case.
- Email alerts whenever there is an update.
- Full text search for other cases.
- Get email alerts whenever a new case matches your search.
One Moment Please
The filing “” is large (MB) and is being downloaded.
Please refresh this page in a few minutes to see if the filing has been downloaded. The filing will also be emailed to you when the download completes.
Your document is on its way!
If you do not receive the document in five minutes, contact support at support@docketalarm.com.
Sealed Document
We are unable to display this document, it may be under a court ordered seal.
If you have proper credentials to access the file, you may proceed directly to the court's system using your government issued username and password.
Access Government Site
