UnrectorPTABRDecisionReview@uspto.gov
`571-272-7822
`
`Paper 18
`Date: August 23, 2022
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE OFFICE OF THE UNDER SECRETARY OF COMMERCE
`FOR INTELLECTUAL PROPERTY AND DIRECTOR OF THE UNITED
`STATES PATENT AND TRADEMARK OFFICE
`
`CODE200, UAB; TESO LT, UAB; METACLUSTER LT, UAB;
`OXYSALES, UAB; and CORETECH LT, UAB,
`Petitioner,
`
`V.
`
`BRIGHT DATA LTD.,
`Patent Owner.
`
`IPR2022-00861 (Patent 10,257,319 B2)
`IPR2022-00862 (Patent 10,484,510 B2)!
`
`
`Before KATHERINE K. VIDAL, Under Secretary of Commerce for
`Intellectual Property and Director of the United States Patent and
`Trademark Office.
`
`DECISION
`Ordering Rehearing, Vacating the Decision Denying Institution, and
`Remandingto the Patent Trial and Appeal Board Panel for Further
`Proceedings
`
`' This Order applies to each of the above-listed proceedings.
`
`
`571-272-7822
`
`Paper 18
`Date: August 23, 2022
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE OFFICE OF THE UNDER SECRETARY OF COMMERCE
`FOR INTELLECTUAL PROPERTY AND DIRECTOR OF THE UNITED
`STATES PATENT AND TRADEMARK OFFICE
`
`CODE200, UAB; TESO LT, UAB; METACLUSTER LT, UAB;
`OXYSALES, UAB; and CORETECH LT, UAB,
`Petitioner,
`
`V.
`
`BRIGHT DATA LTD.,
`Patent Owner.
`
`IPR2022-00861 (Patent 10,257,319 B2)
`IPR2022-00862 (Patent 10,484,510 B2)!
`
`
`Before KATHERINE K. VIDAL, Under Secretary of Commerce for
`Intellectual Property and Director of the United States Patent and
`Trademark Office.
`
`DECISION
`Ordering Rehearing, Vacating the Decision Denying Institution, and
`Remandingto the Patent Trial and Appeal Board Panel for Further
`Proceedings
`
`' This Order applies to each of the above-listed proceedings.
`
`
`
`IPR2022-00861 (Patent 10,257,319 B2)
`IPR2022-00862 (Patent 10,484,510 B2)
`
`I.
`
`INTRODUCTION
`
`On July 25, 2022, the Patent Trial and Appeal Board (PTAB or
`
`Board) issued Decisions DenyingInstitution of /nter Partes Review in
`
`IPR2022-00861 and IPR2022-00862, which also denied joinder of these
`
`proceedings with, respectively, IPR2021-01492 and IPR2021-01493.
`
`IPR2022-00861, Paper 17 (Decisions or Dec.’); IPR2022-00862, Paper 17.
`
`Asis relevant to this Order, the Board denied institution under 35 U.S.C.
`
`§ 314(a), exercising the Board’s discretion to deny institution as set forth in
`
`Gen. Plastic Indus. Co. v. Canon Kabushiki Kaisha, 1PR2016-01357, Paper
`
`19 (PTAB Sept. 6, 2017) (precedential as to § II.B.4.1) (General Plastic).
`
`Dec. 16.
`
`In its Decisions, the Board determined that the factors articulated in
`
`General Plastic weighed in favor of exercising discretion to deny institution
`
`under § 314(a). Dec. 10-11. Addressing factor 1 of General Plastic
`
`(“whether the samepetitioner previously filed a petition directed to the same
`
`claims of the samepatent’’), the Board acknowledgedthe Petitioner’s
`
`argument that similar patentability challenges the Petitioner previously
`
`asserted in prior petitions’ were “not evaluated on the merits, and instead the
`
`? The analysesset forth in the Decisions in IPR2022-00861 and IPR2022-
`00862 are substantially similar. Accordingly,all citations are to[IPR2022-
`00861, unless otherwise noted.
`3 TPR2020-01266 and IPR2020-01358 werefiled on July 14, 2020, and
`July 28, 2020, respectively, by the same Petitioner in these proceedings.
`IPR2020-01266, Paper 5, 2, 73; IPR2020-01358, Paper 5, 2, 78. The Board
`exercised its discretion to deny institution under 35 U.S.C. § 314(a) based on
`Apple Inc. v. Fintiv, Inc., 1PR2020-00019, Paper 11 (March 20, 2020)
`(precedential) (Fintiv). IPR2020-01266, Paper 18, 7, 12 (December 23,
`2020); IPR2020-01358, Paper 11, 6, 11 (February 2, 2021).
`
`2
`
`
`
`IPR2022-00861 (Patent 10,257,319 B2)
`IPR2022-00862 (Patent 10,484,510 B2)
`
`denial[s were] based on discretionary grounds.” /d. at 11-12 (citing Paper
`
`13, 2). The Board explained, however, that the Petitioner’s failure to offer a
`
`stipulation agreeing not to raise the groundsasserted in these inter partes
`
`reviews(IPRs) in related district court litigation “weigh[ed] strongly in favor
`
`of exercising discretion to deny institution and outweigh[ed] the fact that the
`
`Board did not substantively address the merits of the prior petition[s].” /d. at
`
`12. The Board further analyzed factors 2-7 of General Plastic and
`
`determined to exercise discretion under 35 U.S.C. § 314(a) to deny
`
`institution. See id. at 12-16.
`
`I have considered the Board’s Decisions Denying Institution of /nter
`
`Partes Review, and | initiate a sua sponte Director review of those decisions
`
`to clarify the application of General Plastic. See Interim processfor
`
`Director review §§ 13, 22 (providing for sua sponte Director review and
`
`explaining that “the parties to the proceeding will be given notice”if
`
`Director review is initiated sua sponte).*
`
`Il. DISCUSSION
`
`General Plastic holds that the Board may denya petition based on the
`
`discretionary authority of 35 U.S.C. § 314(a). General Plastic at 8. General
`
`Plastic sets forth non-exclusive factors for the Board to consider when
`
`determining whether to exercise discretion under § 314(a) to deny institution
`
`of review in order to address multiple, serial petitions:
`
`1. whether the same petitioner previously filed a petition directed
`to the same claims of the same patent;
`
`2. whetherat the time offiling of the first petition the petitioner
`
`* Available at https://www.uspto.gov/patents/patent-trial-and-appeal-
`board/interim-process-director-review.
`
`3
`
`
`
`IPR2022-00861 (Patent 10,257,319 B2)
`IPR2022-00862 (Patent 10,484,510 B2)
`
`knew ofthe prior art asserted in the second petition or should
`have knownofit;
`
`3. whetherat the time offiling of the second petition the petitioner
`already received the patent owner’s preliminary responseto the
`first petition or received the Board’s decision on whether to
`institute review in thefirst petition;
`
`4.
`
`the length of time that elapsed between the timethe petitioner
`learned of the prior art asserted in the second petition and the
`filing of the secondpetition;
`
`5. whether the petitioner provides adequate explanation for the
`time elapsed betweenthe filings of multiple petitions directed
`to the sameclaimsof the same patent;
`
`6.
`
`the finite resources of the Board; and
`
`
`
`7. the requirement under 35 U.S.C. § 316(a)(11) to issueafinal
`determination not later than | year after the date on which the
`Director notices institution of review.
`
`General Plastic at 9-10.
`
`In applying factor 1, the Board held that the Petitioner’s failure to
`
`submit a Sand Revolution II stipulation’ “weighs strongly in favor of
`
`exercising discretion to deny institution and outweighsthe fact that the
`
`Board did not substantively address the merits of the prior petition.” Dec. 12.
`
`I respectfully disagree. As the Board recently held, “allowing [a petitioner]
`
`the opportunity to pursue a decision on the merits” in a second-filed petition,
`
`whenthefirst-filed petition was not evaluated on the merits, “best balances
`
`the desires to improve patent quality and patent-system efficiency against
`
`> The Board notedthat the “Petitioner here had the guidance provided by
`Sand Revolution IT, and could have proffered such a stipulation, but did not
`do so.” Dec. 12.
`
`
`
`IPR2022-00861 (Patent 10,257,319 B2)
`IPR2022-00862 (Patent 10,484,510 B2)
`
`the potential for abuse of the review process by repeated attacks on patents.”
`
`Intel Corp. v. VLSI Tech. LLC, IPR2022-00366, Paper 14 (June 8, 2022), 9—
`
`10. Holding otherwise would undercut the congressional grant to the United
`
`States Patent and Trademark Office of “significant powerto revisit and
`
`revise earlier patent grants” as a mechanism “to improvepatent quality and
`
`restore confidence in the presumption of validity that comes with issued
`
`patents.” Cuozzo Speed Techs., LLC v. Lee, 579 U.S. 261, 272 (2016)
`
`(quoting H.R. Rep. No. 112-98, pt. 1, at 45, 48).
`
`General Plastic factor 1 must be read in conjunction with factors 2
`
`and 3. Wherethefirst-filed petition under factor 1 was discretionarily denied
`
`or otherwise wasnot evaluated on the merits, factors 1-3 only weigh in
`
`favor of discretionary denial when there are “road-mapping”concerns under
`
`factor 3 or other concerns underfactor 2. As General Plastic noted with
`
`regard to road-mapping:
`
`Multiple, staggered petitions challenging the same patent and
`same claims raise the potential for abuse. The absence of any
`restrictions on follow-on petitions would allow petitioners the
`opportunity to strategically stage their prior art and arguments in
`multiple petitions, using our decisions as a roadmap, until a
`ground is found that results in the grant of review.
`
`General Plastic at 17.
`
`Here, the Board found “no evidence of road-mapping.” Dec. 13.
`
`Indeed, “road-mapping” concerns are minimized when,as in this case, a
`
`petitionerfiles a later petition that raises unpatentability challenges
`
`substantially overlapping with those in the previously-filed petition and the
`
`later petition is not refined based on lessons learned from later
`
`developments.
`
`
`
`IPR2022-00861 (Patent 10,257,319 B2)
`IPR2022-00862 (Patent 10,484,510 B2)
`
`Although the Board considers factors 2, 4, and 5 “to assess and weigh
`
`whether a petitioner should have or could have raised the new challenges
`
`earlier” (General Plastic at 18), factor 2 may also be relevant to the
`
`consideration of factors 1 and 3. That said, the Board correctly found here
`
`that factors 2, 4, and 5 “have limited relevance.” Dec. 13. I similarly find
`
`factor 7 to “have limited relevance,” as the Board notedthat “the one year
`
`statutory time period maybe adjusted for a joined case under 35 U.S.C.
`
`§ 316(a)(11).” Dec. 16.
`
`Although the Board determined thatit 1s inefficient to expend Board
`
`resources on this proceeding, under factor 6 (Dec. 14—15), I respectfully
`
`disagree. Rather, the Board’s mission “to improve patent quality and restore
`
`confidence in the presumption of validity that comes with issued patents”
`
`outweighs the impact on Board resources needed to evaluate the merits of a
`
`petition. Cuozzo Speed Techs., 579 U.S. at 272.
`
`Giventhat (1) the first-filed petition, pertinent to factor 1, was
`
`discretionarily denied and the Board did not substantively address the merits
`
`of the prior petition; (2) there 1s no evidence of “road-mapping”related to
`
`factor 3 or other concernsof fairness related to factor 2; (3) factors 2, 4, and
`
`5 were found to have limited relevance when it comes to a determination as
`
`to whether arguments should have been raised earlier; and (4) I find factor 7
`
`to have limited relevance and factor 6 to be outweighed by the Board’s
`
`mission to improvepatent quality, the Patent Owner’s concernsof fairness
`
`are outweighed by the benefits to the patent system of improving patent
`
`quality by reviewing the merits of the challenges raised in the petitions,
`
`which have not been addressed to date. See General Plastic at 16 (citing
`
`HLR. Rep. No. 112-98, pt. 1, at 40 (2011)).
`
`
`
`IPR2022-00861 (Patent 10,257,319 B2)
`IPR2022-00862 (Patent 10,484,510 B2)
`
`No additional briefing from the parties is authorized. See Interim
`
`processfor Director review § 13 (explaining that the Director maygive the
`
`parties an opportunity for briefing if Director review is initiated sua sponte).
`
`The cases are remandedto the panel to consider the Patent Owner’s
`
`remaining arguments, including those for discretionary denial under /’intiv
`
`and against the merits of the Petitioner’s patentability challenges.
`
`IN. ORDER
`
`Accordingly, based on the foregoing,it is:
`
`ORDEREDthat sua sponte Director review of the Board’s Decisions
`
`Denying Institution and Decisions Denying Motion for Joinder (IPR2022-
`
`00861, Paper 17; IPR2022-00862, Paper 17) are initiated;
`
`FURTHER ORDEREDthat the Decisions Denying Institution and
`
`Decisions Denying Motion for Joinder are vacated;
`
`FURTHER ORDEREDthat the cases are remandedto the panel for
`
`further proceedings consistent with this Decision; and
`
`FURTHER ORDEREDthatthe panel reconsider joinder after
`
`reconsidering the institution decisions.
`
`
`
`IPR2022-00861 (Patent 10,257,319 B2)
`IPR2022-00862 (Patent 10,484,510 B2)
`
`FOR PETITIONER:
`
`George “Jorde” Scott
`John Heuton
`CHARHON CALLAHAN ROBSON & GARZA, PLLC
`jscott@ccrglaw.com
`theuton@ccrglaw.com
`
`FOR PATENT OWNER:
`
`Thomas Dunham
`Elizabeth O’Brien
`CHERIAN LLP
`tomd@ruyakcherian.com
`elizabetho@ruyakcherian.com
`
`
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