United States: IPR Goes Forward Despite Late Stage Parallel ITC Investigation

Last Updated: October 8 2019
Article by Yury Kalish Ph.D. and Vishal V. Khatri

Most Read Contributor in United States, September 2019

Since their inception as part of the AIA, inter partes reviews (IPRs) have been a favorite tool in the arsenal of patent challengers.  Their statutorily mandated 18-month schedule oftentimes allows the PTAB to resolve a question of patent validity faster than a court can in a parallel district court litigation.  In view of this procedural reality, many district courts have been amenable to staying the district court litigation while waiting for the PTAB's decision.  The alignment of the claim construction standard between the PTAB and the district courts has served to reinforce this trend.

This strategy has not been as successful when the underlying infringement challenge is brought in the International Trade Commission (ITC).  The ITC has its own expedited schedule so the ITC has never stayed an investigation in view of a pending IPR.  Sometimes, the ITC may dispose with a matter on the merits, including a patent validity determination, before a final written decision in the parallel IPR proceeding.

The PTAB recently faced a similar situation when deciding whether to institute an IPR filed by Emerson Electric Co. ("Emerson") against a patent related to a system for monitoring, controlling, and reporting on remote systems utilizing radio frequency (RF) transmissions owned by Sipco, LLC ("Sipco").  IPR2019-00547, Paper 15 (August 30, 2019).  One of the arguments Sipco raised in its Preliminary Patent Owner's Response was that the underlying ITC investigation into alleged infringement of that patent was in a late stage, and that Emerson raised invalidity defenses in that investigation based on the same combination of prior art asserted in the IPR petition.  Sipco argued that the PTAB should exercise its discretion under 35 U.S.C. § 314(a) and deny Emerson's IPR petition.  The Board rejected these arguments and instituted the IPR.

As an initial matter, the Board pointed out that under its precedential decision in General Plastics, the Board considers multiple non-exclusive factors in determining whether to exercise discretion under § 314(a).  General Plastic Indus. Co., Ltd. v. Canon Kabushiki Kaisha, Case IPR2016-01357 (PTAB Sept. 6, 2017) (Paper 19) (precedential).  Sipco, they said, only addressed one factor – presumably, the finite resources of the Board.  Furthermore, the Board was not persuaded that the ITC investigation would address the same issues and the same evidence as in the IPR.  First, the Board noted that any validity related determination by an Administrative Law Judge ("ALJ") in the ITC investigation would not be final, as it is subject to the Commission's review and possible reversal.  Second, the Board cited Texas Instruments to point out that even if the Commission invalidates a patent, its findings would not be binding on other forums.  Texas Instr. Inc. v. Cypress Semiconductor Corp., 90 F.3d 1558, 1569 (Fed. Cir. 1996).  Specifically, the ITC determination would not be enforceable as to the USPTO, and would not result in the cancellation of patent claims.  Third, the Board explained that evidentiary standards and parties' burdens are different at the ITC and the PTAB.

While the Board acknowledged that "an ITC decision in the co-pending investigation may inform [its] decision,"  they concluded that "it does not render [the PTAB] proceeding duplicative or amount to a waste of the Board's resources."  IPR2019-00547, Paper 15 at 9.  Therefore, the Board was not persuaded to exercise its discretion under 35 U.S.C. § 314(a) to deny the petition based on the status of parallel ITC proceedings.

The ITC has also been reluctant to give deference to PTAB decisions.  For example, in 337-TA- 945, the Commission denied Respondent's petition to rescind its remedial orders after the relevant claims were found unpatentable in IPR decisions (discussed here and here).  The remedial orders were modified only after the Federal Circuit affirmed the PTAB's decision.  However, in 337-TA-1058 (discussed here), the Commission agreed to suspend enforcement of certain remedial orders with respect to a claim found unpatentable by the PTAB, pending final resolution of the PTAB's Final Written Decision.


Even if an ITC investigation may reach a decision on patent validity before the PTAB is able to, that will not necessarily dissuade the PTAB from instituting an IPR.  Parties at the ITC seeking to utilize a PTAB proceeding should consider possible strategic advantages to maintaining an IPR even if the ITC will reach a decision on validity first.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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