Since their introduction, inter partes review ("IPR") proceedings have had a close association with district court litigation. Indeed, litigation defendants are often the petitioners who initiate IPR proceedings. Therefore, the effect that an IPR can have on concurrent or potential litigation is an important consideration for petitioners.
Among the factors that petitioners must consider are the IPR estoppel provisions. In particular, 35 U.S.C. § 315(e)(2) dictates that once the Patent Trial and Appeal Board ("PTAB") has issued a final written decision on a patent's claim(s), an IPR petitioner may not assert "that the claim is invalid on any ground that the petitioner raised or reasonably could have raised during that post-grant review." Section 315(e)(2) estoppel seemingly narrows the scope of the invalidity defenses that may be asserted not only in subsequent district court litigation, but also subsequent International Trade Commission proceedings.
While previously the subject of some ambiguity, the scope of § 315(e) estoppel, and the meaning of "reasonably could have been raised," has been illuminated by at least one recent district court decision.
In Clearlamp, LLC v. LKQ Corporation, No. 12-cv-2533 (N.D. Ill.) (Mar. 18, 2016), the defendant, LKQ, filed an IPR petition that the PTAB instituted on grounds that included a combination of certain prior art. The PTAB subsequently issued a final written decision that some of Clearlamp's patent claims were unpatentable, but the PTAB also found that LKQ had not met its burden to demonstrate unpatentability as to other claims.
Back in district court, LKQ attacked the remaining claims by combining the prior art used during the IPR with a datasheet for a "UVHC3000" product that LKQ obtained through third party discovery after the IPR was completed. On summary judgment, Clearlamp argued that LKQ was estopped from presenting the same prior art combination as in the IPR along with the supplemental datasheet, because, according to Clearlamp, § 315(e)(2) estops the assertion of "redundant" grounds, i.e., grounds based on the same reasoning, in district court, and because the UVHC3000 product was known to LKQ prior to its IPR petition.
The district court first found that § 315(e) does not estop grounds merely because they are "redundant" of grounds asserted in the IPR. The district court noted, by the language of statute:
[t]he relevant inquiry. . . is not whether the ground is redundant of a ground that was asserted but, rather, whether the ground reasonably could have been raised [emphasis added]. Merely being redundant to a ground that could have been asserted during inter partes review does not estop the alleged infringer from relying upon a ground based upon prior art that was not reasonably available during inter partes review.
In view of this standard, addressing Clearlamp's next argument, the district court found that "the datasheet can be used in civil litigation only if it could not have been found by a skilled searcher performing a diligent search." Furthermore, as the party asserting that estoppel applied, it was Clearlamp's burden to demonstrate that a skilled searcher would have located the datasheet.
The district court suggested criteria for how Clearlamp might meet its burden, namely "(1) to identify the search string and search source that would identify the allegedly unavailable prior art and (2) present evidence, likely expert testimony, why such a criterion would be part of a skilled searcher's diligent search." Finding that estoppel did not apply, the district court noted that at most Clearlamp showed that a search for "UVHC3000" yielded many results, but not the particular datasheet that LKQ obtained in third party discovery (even though the datasheet itself was once a publicly available document).
Ultimately, based on the datasheet and the PTAB's instructive reasoning, the district court granted summary judgment of invalidity as to the remaining claims.
This decision and the Federal Circuit's recent decision in Shaw Industries Group, Inc. v. Automated Creel Systems, Inc., No. 2015-1116, 2015-1119 (Fed. Cir. Mar. 23, 2016) , discussed here, appear to narrow the understood scope of § 315(e) estoppel. In particular, the Clearlamp decision highlights a potential way to revive reasoning that the PTAB considered in an IPR. Where third party discovery yields documents that are not otherwise identifiable by a skilled searcher performing a diligent search, estoppel may not apply.
Thus, defendants whose IPR petitions may not have knocked out all the asserted claims should likely explore the possibility of unearthing new information about the art that underlies the IPR grounds, or even art that my augment the IPR grounds. Conversely, the seemingly narrowing scope of § 315(e)(2)'s estoppel may cause plaintiffs to request additional restrictions in litigation stays pending the outcome of a concurrent IPR – for example, that the requestor agree to waive the assertion of § 102 and § 103 defenses should some asserted claims survive.
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