United States: How High Court IPR Time-Bar Ruling Affects PTAB Practice

Earlier this year, in Thryv Inc. v. Click-to-Call Technologies LP,¹ the U.S. Supreme Court held that parties cannot appeal Patent Trial and Appeal Board determinations of whether a petition is timely in an inter partes review, reversing the en banc U.S. Court of Appeals for the Federal Circuit.

At institution, the PTAB must apply a statutory one-year time bar: If the patent owner has filed and served an infringement suit against the petitioner more than one year before the IPR is filed, the petition is time-barred and dismissed. Thryv clarifies that once the PTAB determines that the petition is time-barred or not, the decision cannot be appealed to the Federal Circuit.

Thryv follows another Supreme Court patent case, Cuozzo Speed Technologies LLC v. Lee, further limiting appellate review of decisions closely tied to the decision to institute. Thryv and Cuozzo form two important points on a line, one that trends toward broader discretion for the PTAB to apply procedural bars without the possibility of appeal.

Perhaps taking a cue from the Supreme Court, the Federal Circuit and PTAB have recently questioned if Thryv should extend to other Federal Circuit decisions - perhaps those cases should never have been appealed. Without appellate review, the PTAB acquires broad discretion over the application of procedural bars like the one-year time bar.

Thryv

In Thryv, the court addressed whether PTAB decisions made under Title 35 of the U.S. Code, Section 315(b), can be judicially reviewed, where judicial review refers to review before the Federal Circuit rather than an administrative agency like the PTAB.² That section the filing of an IPR "more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent."³

In 2013, Thryv filed an IPR against Click-to-Call's patent; Click-to-Call responded that the challenge was time-barred under Section 315(b) because of an infringement suit served against Thryv's predecessor in 2001.⁴ The PTAB sided with Thryv, finding the one-year bar did not apply because the 2001 suit was voluntarily dismissed without prejudice.⁵ The PTAB reiterated this point in the final written decision and ultimately cancelled 13 of Click-to-Call's claims.⁶

Click-to-Call appealed. Thryv and the U.S. Patent and Trademark Office argued that the statutory construction of Section 315(b) favored tolling the one-year bar from the service of a suit dismissed without prejudice.⁷

The Federal Circuit stated the one-year bar was appealable, relying on a separate case, Wi-Fi One LLC v.  Broadcom Corp.⁸ Considering the issue before it, the en banc Federal Circuit held the one-year bar should apply even if the suit is later dismissed, and thus it instructed the board to dismiss the "long-marooned case."⁹

The Supreme Court granted Thryv's petition for writ of certiorari. In a 7-2 vote vacated the Federal Circuit's decision, holding that Section 314(d) prohibits appeal of PTAB decisions regarding the one-year bar.¹⁰ In doing so, the majority relied on Cuozzo, which held that decisions concerning the reasonable likelihood of success of the petition cannot be appealed.¹¹

Like the statutory sections at issue in Cuozzo, the majority reasoned that the one-year bar under Section 315(b) is "'closely tied to the application and interpretation of statutes related to' the institution decision," and, as such, also cannot be appealed.¹²

Writing for the majority, Justice Ruth Bader Ginsburg further pointed to concerns over judicial efficiency and a need to "weed out bad patent claims," but did leave open the possibility of mandamus petitions for "extraordinary cases."¹³

Aftermath

Thryv ultimately prevailed at the Supreme Court, avoiding the one-year bar and achieving the cancellation of CTC's claims.¹⁴ However, subsequent PTAB action indicates a willingness to maintain the status quo and enforce the one-year bar going forward. Leading up to Thryv, the USPTO acknowledged the original panel was wrong on the merits.¹⁵

The PTAB has since demoted the original Click-to-Call board decision from precedential to nonprecedential "in view of the [PTAB's] Precedential Opinion Panel (POP) decision in GoPro, Inc. v. 360Heros, Inc." - a decision in which the board denied institution as time-barred under Section 315(b).¹⁶

In GoPro, the PTAB considered whether a deficient counterclaim filed more than one-year before the IPR triggered the Section 315(b)-bar.¹⁷ It found the one-year bar applied regardless of pleading deficiencies because it still put the petitioner on notice.¹⁸ Notably, the PTAB's reasoning in GoPro relied heavily on the Federal Circuit's now-vacated Click-to-Call decision.¹⁹

Indeed, several standing precedential opinion panel decisions rely on Click-to-Call, indicating that, despite its vacatur, the opinion will likely remain influential in future institution decisions.²⁰ Thus, the PTAB will likely continue to apply the reasoning used in Click-to-Call and apply the one-year bar in the same way it has, by providing legal effect to served complaints that start the one-year clock.

Future Implications at PTAB

While the PTAB will likely continue application of the one-year bar in line with the reasoning of Click-to-Call, just how broadly Thryv applies remains murky. In its first decision relying on Thryv, the Federal Circuit found "no principled reason why preclusion of judicial review under § 314(d) would not extend" to a requirement that the party identify all real parties in interest.²¹

Thus, the Federal Circuit determined that it could not review the PTAB's decision during institution that the real party in interest was correctly identified, and²² Thryv already applies outside of the one-year bar.

Parties often argue which parties should be named in an IPR, an issue typically brought up during institution. Thryv may also extend here to preclude judicial review. Applying Thryv, the Federal Circuit rejected review of an institution decision concerning issues of joinder and the one-year bar because "a tardy filing of a petition for IPR, [and] the PTAB's acceptance of such filing ... is, by statute not reviewable on appeal."²³

Parties are briefing the application of Thryv in other cases as well. In one case, the Federal Circuit asked litigants for briefing on whether it is permitted to review an institution decision concerning joinder of parties and issues to an existing IPR.²⁴

Similarly, the PTAB asked litigants for briefing on whether it is bound by and should rely on a Federal Circuit decision regarding the definition of a real party in interest and the one-year bar.²⁵

Each of these cases involves the one-year bar but also addresses other statutes related to joinder that previously fell in the purview of the Federal Circuit.²⁶ After Thryv, perhaps no longer. Thus, Thryv's impact may continue to expand to statutes tied to the institution decision.

Mandamus Options to Federal Circuit

For those parties that still seek relief from an institution decision but can no longer appeal due to Thryv or Cuozzo, parties may submit a petition for writ of mandamus to the Federal Circuit.

A rise in mandamus petitions seems likely because it is the last possibility for Federal Circuit review. However, as Justice Neil Gorsuch, writing for the dissent in Thryv, pointed out, this may be an uphill battle. Justice Gorsuch pointed to In re: Power Integrations, where the Federal Circuit stated that a mandamus petition cannot simply be an appeal re-styled as a writ for mandamus.²⁷

And, he further noted, "If the [below institution decision] doesn't qualify as 'extraordinary,' ... then what extralegal act wouldn't be just another day at the office?"²⁸

Given the current uncertainty, parties on both sides should pay close attention to the procedural bars. Thryv, following in Cuozzo's footsteps, makes it more difficult to appeal PTAB decisions on these bars.

For the patent owner, winning a motion for a procedural bar could mean an institution decision that dismisses a petitioner's brief without consideration of the merits. Failing to win application of a procedural bar during institution leaves open the possibility of an adverse decision on patentability.

For the petitioner, losing because of a procedural bar means losing the costs associated with an IPR petition and could lead to adverse decisions in ongoing or future infringement suits. Considering the stakes, parties should thus take care to identify and effectively argue procedural bars - or risk losing the IPR.

Footnotes

1. Thryv, Inc v. Click-To-Call Techs., LP , 140 S. Ct. 1367 (2020).

2. Id. at 1372-73.

3. 35 U.S.C. § 315(b).

4. Oracle Corp. v. Click-to-Call Techs. LP, No. IPR2013-00312, 2013 WL 11311788, Paper No. 26 (P.T.A.B. Oct. 30, 2013).

5. Id.

6. Oracle Corp. v. Click-to-Call Techs. LP, No. IPR2013-00312, 2014 WL 5490583, Paper No. 52 at 6-7 (P.T.A.B. Oct. 28, 2014).

7. Click-To-Call Technologies, LP v. Ingenio, Inc. , 899 F.3d 1321, 1328-41 (Fed. Cir. 2018),cert. granted in part sub nom. Dex Media, Inc. v. Click-To-Call Techs., LP , 139 S. Ct. 2742 (2019), and vacated and remanded sub nom. Thryv, Inc v. Click-To-Call Techs., LP, 140 S. Ct. 1367 (2020), and judgment vacated, appeal dismissed sub nom. Click-To-Call Techs., LP v. Ingenio, Inc. , No. 2015-1242, 2020 WL 2771324 (Fed. Cir. May 28, 2020).

8. Id., at 1327-28.

9. Id., at 1324-25.

10. Section 314(d) states the Director's decision "to institute an inter partes review under this section shall be final and nonappealable."

11. Thryv, 140 S. Ct. at 1375-76 (citing Cuozzo Speed Techs., LLC v. Lee , 136 S. Ct. 2131, 2134 (2016)).

12. Id. at 1373.

13. Id. at 1374 n. 4.

14. Id. at 1370.

15. Br. for the Federal Respondent Supporting Reversal, 2019 WL 4201258, at *36, Dex Media, 139 S. Ct. 2742.

16. USPTO, https://content.govdelivery.com/accounts/USPTO/bulletins/289e1f8 (May 5, 2020).

17 .GoPro, Inc. v. 360Heros, Inc., No. IPR2018-01734, Paper No. 38 at 24 (P.T.A.B. Aug. 23, 2019).

18. Id. at 14.

19. Id. at 8-9.

20. See Cisco Systems v. Chrimar Systems, No. IPR2018-01511, Paper No. 11 (P.T.A.B. Jan. 31, 2019); Infiltrator Water Techs., LLC, v. Presby Patent Trust, No. IPR2018-00224, Paper No. 18 (P.T.A.B. Oct. 1, 2018); Ventex Co., Ltd. v. Columbia Sportswear N. Am., Inc., IPR2017-00651, Paper No. 152 (P.T.A.B. Jan. 24, 2019).

21. ESIP Series 2, LLC v. Puzhen Life USA, LLC , 958 F.3d 1378, 1386 (Fed. Cir. May 19, 2020); see also Toyota Motor Corp. v. Reactive Surfaces Ltd. , 2020 WL 3886488, at *2 n. 1 (Fed Cir. Jul. 10, 2020).

22. Id.

23. Fitbit, Inc. v. Valencell, Inc. , No. 2019-1048, 2020 WL 3815662, at *2 (Fed. Cir. July 8, 2020).

24. Facebook, Inc. v. Windy City Innovations, LLC , 803 F. App'x 408 (Fed. Cir. 2020) (citing Facebook, Inc. v Windy City Innovations, LLC , 953 F.3d 1313, 1321 (Fed. Cir. 2020)); see 35 U.S.C. § 315(c).

25. Unified Patents, LLC, v. American Patents, LLC, No. IPR2019-00482, 2020 WL 2478573, at 1 (P.T.A.B. May 8, 2020).

26. See VirnetX Inc. v. Mangrove Partners Master Fund, Ltd. , 778 Fed. Appx. 897, 901 (Fed. Cir. 2019).

27. Thryv, 140 S. Ct. at 1389 (Gorsuch, J., dissenting) (citing In re Power Integrations, Inc. , 899 F.3d 1316, 1319 (2018)).

28. Id.