United States: Combatting Lack Of Assignor Estoppel In IPRs (Maybe)

Assignor estoppel is an equitable doctrine that prevents a party who assigns a patent to another from later challenging the validity of the assigned patent.  As reported in a prior post, the Federal Circuit recently stated that assignor estoppel does not apply to inter partes review (IPR) proceedings.  Arista Networks, Inc. v. Cisco Sys., Nos. 2017-1525, 2017-1577 (Fed. Cir. Nov. 9, 2018) (finding that 35 U.S.C. § 311(a) "unambiguously dictates that assignor estoppel has no place in IPR proceedings").

One week after the Federal Circuit's decision in Arista Networks, a district court granted a plaintiff's motion for leave to file an early motion for summary judgment on assignor estoppel. AgroFresh Inc. v. Mirtech, Inc., Case No. 1:16-cv-00662, ECF No. 310 (D. Del. Nov. 16, 2018, redacted Nov. 28, 2018). The plaintiff's motion was in response to a petition to institute an IPR filed by the defendant in the action, an alleged previous assignor. Id. The court noted that the PTAB "does not evaluate the equitable doctrine of assignor estoppel due to the statutory mandate in 35 U.S.C. § 311(a) permitting any person who is not the owner of a patent to file an IPR petition." Id. at 9 (citing Athena Automation Ltd. v. Husky Injection Molding Systems Ltd., IPR2013-00290, Paper 18 (P.T.A.B. Oct. 25, 2013)). As such, the court found "the issue of assignor estoppel [to be] uniquely within [its] jurisdiction." Id.

The court agreed to allow the plaintiff to file an early motion for summary judgment based on assignor estoppel, reasoning that if the plaintiff's motion was granted, "[the defendant's] validity challenges in the IPR proceeding would be nullified due to the estoppel effect of the doctrine."  Id.  Further, the court stated that a summary judgment that assignor estoppel applies "may impact the viability of the pending IPR proceeding, and would eliminate the invalidity defense regarding the [patent-in-suit] from the litigation."  Id.

We will continue to monitor this case for any updates.

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