United States: Federal Circuit Overturns PTAB's Precedential Opinion Panel: No Same Party Or Issue Joinder Permitted

The Federal Circuit provided new guidance regarding the scope of joinder under 35 U.S.C. § 315(c).  In Facebook, Inc. v. Windy City Innovations, LLC, 2020 U.S. App. LEXIS 8522, *10-12 (Fed. Cir. 2020), the Court addressed two issues of statutory interpretation: (1) whether 35 U.S.C. § 315(c) permits a person to be joined as a party to a proceeding in which it was already a party ("same party" joinder); and (2) whether it permits new issues to be added to an existing IPR through joinder ("new issue" joinder), including issues that would otherwise be time-barred.  Id. at *10.

The Court answered both questions in the negative, contrary to a decision rendered by the PTAB's Precedential Opinion Panel.  See id. at *10-12.  The Federal Circuit found "[t]he clear and unambiguous text of § 315(c) does not authorize same-party joinder, and does not authorize the joinder of new issues."  Id. at *12 (emphasis added).

Background

Windy City filed a complaint accusing Facebook of infringing four patents in the U.S. District Court for the Western District of North Carolina on June 2, 2015.  Id. at *5.  Windy City served the complaint on June 3, 2015, triggering the one-year clock for Facebook to file IPR petition(s) challenging the validity of the asserted patents.  The four patents contained a total of 830 claims.  Id. 

Facebook filed four IPR petitions (each directed to a different one of the four asserted patents) on the last day before being time-barred.  Id. at *6.  The four petitions challenged some, but not all, of the 830 claims.  Id.  More than four months later, Windy City identified the specific patent claims that it was asserting in the district court case.  Id.  Some of the claims for two of the patents were not challenged in the four petitions that were initially filed.  Id. at *6-7.  Facebook then filed two additional IPR petitions after the one-year time bar date directed to the previously unchallenged claims and requested joinder to the already instituted IPRs.  Id. at *7.  Consistent with prevailing PTAB practice at the time, the Board granted Facebook's motions for joinder and allowed the newly challenged claims to be joined to the IPR proceedings.  Id. at *7.

At the conclusion of the IPR proceedings, Facebook was successful in invalidating some of the claims (including some of the claims challenged only in the subsequently filed IPRs), while others were upheld.  See id. at *8-9.  Facebook appealed and Windy City cross-appealed arguing, among other things, that § 315(c) precluded same party joinder and issue joinder.

The Federal Circuit Opinion

As explained by the Federal Circuit, "35 U.S.C. § 315 governs the relationship between IPRs and other proceedings."  Id. at *11.  Windy City argued that § 315(c) unambiguously precludes both same party and new issue joinder.  See id. at *11-12.  Facebook agreed that the statute was clear and unambiguous, but argued it supported the opposite conclusion.  See id.  The Federal Circuit agreed with Windy City.  Id. at *12.

In addressing same party joinder, the Federal Circuit held "that the clear and unambiguous meaning of § 315(c) does not authorize joinder of two proceedings, and does not authorize the Director to join a person to a proceeding in which that person is already a party."  The Federal Circuit focused on the § 315(c) text (reproduced above), which states the Director "may join as a party ... any person who properly files a petition" and found that this language clearly and unambiguously does not allow the same party to join one proceeding with a second proceeding.  See id. at *13-17.

The Federal Circuit came to a similar conclusion regarding new issue joinder.  See id. at *17-23.  The Court explained that "the language in 315(c) does no more than authorize the Director to join 1) a person 2) as a party, 3) to an already instituted IPR....  [T]his language does not authorize the joined party to bring new issues from its new proceeding into the existing proceeding."  Id. at *17 (emphasis added).  Therefore, the Court reversed the Board's invalidity finding for all claims that were only challenged in the two additional petitions filed after the one-year time bar date.  See id. at *24.

Take Away

Petitions filed after the one year bar date cannot be joined to existing IPR proceedings.  This is true for both same party and issue joinder.  Joinder can no longer be used as a mechanism to obviate the statutory time bar.

In patent infringement suits where a large number of claims are asserted, defendants may benefit from obtaining an early indication of the asserted claims for the purpose of identifying the target claims for an IPR.  However, it may not always be possible for parties to identify with certainty the scope of asserted claims in district court before the one-year time bar.  Petitioners should consider filing their petitions before the time bar if they wish to guarantee the opportunity for review at the PTAB.

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