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In a covered business method review filed by petitioner GTNX, Inc., the petitioner sought review of four patents owned by patent owner INTTRA, Inc. The PTAB instituted trial on all four patents following the patent owner’s preliminary response. Notably, in its preliminary response the patent owner did not raise that the reviews were barred under 35 U.S.C. § 325(a)(1) based on petitioner’s prior invalidity challenge of the patents in a declaratory judgment action before a United States District Court. After the parties briefed the issue to the Board, the Board vacated its Decisions on Institution and terminated the CBMs based on the petitioner’s prior declaratory judgment action.

In its precedential SecureBuy decision, the Board noted that “§ 18 of the Leahy-Smith America Invents Act, Pub. L. No. 112-29, 125 Stat. 284, 329-31 (2011) (“AIA”) “provides that covered business method patent review proceedings shall employ all the statutory standards and procedures of a post-grant review (i.e., 35 U.S.C. §§ 321-29), except for those expressly excluded.” 35 U.S.C. § 325(a)(1), which is not expressly excluded by § 18 of the AIA, states:

(1) POST-GRANT REVIEW BARRED BY CIVIL ACTION.–A post-grant review may not be instituted under this chapter if, before the date on which the petition for such a review is filed, the petitioner or real party in interest filed a civil action challenging the validity of a claim of the patent.

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In an IPR petition filed by petitioner Salesforce.com, the petitioner sought review of patent owner, VirtualAgility, Inc.’s U.S. Patent No. 8,095,413. The PTAB instituted trial on November 19, 2013, the Patent Owner filed its Patent Owner Response on January 28, 2014, the Petitioner then filed its Reply on April 11, 2014, oral argument was held on July 14, 2014, and a Final Written Decision was rendered on September 16, 2014. In the Final Written Decision, the Boart held that Petitioner has proven, by a preponderance of the evidence, that claims 1-21 of the ‘413 patent are unpatentable.

As a result, on November 18, 2014, the Patent Owner filed a Notice of Appeal to the Court of Appeals for the Federal Circuit. At the same time, the parties filed a Joint Motion to File Settlement Agreement as Confidential Business Information. Subsequently, on November 21, 2014, the Patent Owner requested authorization to file a motion to vacate the Final Written Decision and to terminate the proceeding after the Final Written Decision was vacated. After hearing from the Patent Owner, the Board denied its request.
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In an IPR petition filed by petitioner Shire Development LLC, the petitioner sought review of patent owner, LCS Group, LLC’s U.S. Patent No. 8,318,813. In its mandatory statement, the patent owner timely designated outside counsel to represent it in the IPR proceeding. Subsequently, the designated counsel for the patent owner sought authorization to withdraw from representation. According to the patent owner’s counsel, the inventor desired to represent himself in the proceeding.

The Board denied the request of the patent owner’s counsel on the grounds that the patent-at-issue is assigned to a juristic entity, i.e., a legal entity that is not a natural person, LCS Group, LLC, which also is designated as the real party-in-interest. Under 37 C.F.R. § 1.31 (2012), because the real party-in-interest in this proceeding is a corporation, a juristic entity, it can only appear through counsel.
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In an IPR petition filed by petitioner C&D Zodiac, Inc., the petitioner sought review of patent owner, B/E Aerospace, Inc.’s U.S. Patent No. 8,590,838, directed to space-saving aircraft enclosures, including lavatories, closets, and galleys. The petition challenged the validity of claims under Section 102 and 103 based on, among other things, a publication entitled McDonnell Douglas DC-10 Customer Configuration Summary (Oct. 1978) referred to as an “Orange Book,” presumably because of its orange cover.

The Board granted the petition based on multiple grounds, including the obviousness of the claims in view of a prior art patent to Betts and the Orange Book. Critical to the Board’s holding was its determination that the Orange Book satisfied the printed publication requirement for prior art purposes.
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In the matter pending in the Western District of Texas, Katrinecz, et al. v. Motorola Mobility LLC, Motorola moved to dismiss the complaint for lack of subject matter jurisdiction. In its complaint, the plaintiffs alleged that Motorola infringed U.S. Patent No. 7,284,872 entitled “Low power, low cost illuminated keyboards and keypads.” The ‘872 patent lists Plaintiffs Katrinecz and Byrd as the inventors. In April 1997, the plaintiffs conceived of a keyboard invention and during the summer of 1997 they developed prototypes. In October 1997, they engaged attorneys and filed their first patent application for the invention on August 26, 1998.

During this time, on August 11, 1998, Katrinecz and his spouse executed a Marital Settlement Agreement dissolving their nine-year marriage. The Florida State court rendered a Final Judgment Dissolving Marriage on September 17, 1998. Motorola contended that the invention of the ‘872 patent was developed during the marriage and thus should be considered personal property subject to equitable distribution upon dissolution of the marriage. Motorola further asserted that “when a marital settlement agreement fails to address personal property, that property is co-owned by both spouses by operation of law upon entry of final judgment dissolving the marriage.” Consequently, because the Agreement did not expressly address the disposition of the rights to the invention, Motorola argued that the rights became co-owned by the inventor and his ex-spouse upon entry of the final judgment on September 17, 1998. Because the ex-spouse co-owned the patent when it issued and because she was not a party to the action, the court lacks subject matter jurisdiction and must dismiss the case.
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In the matter pending in the Northern District of California, Aylus Networks, Inc. v. Apple, Inc., Apple moved to stay the litigation pending inter partes review of the patent-in-suit. On October 9, 2013, plaintiff Aylus Networks filed suit against Apple for infringement of U.S. Patent No. RE44,414. On September 29, 2014, Apple filed two petitions for inter partes review of the ‘414 patent. On September 30, 2014, Apple filed the instant stay motion.

The Court began by reciting the applicable law, particularly in cases such as this one where the motion to stay was sought before the PTAB instituted any proceedings against the patent-in-suit:

Courts have inherent power to manage their dockets and stay proceedings, including the authority to order a stay pending conclusion of a PTO reexamination.” Ethicon, Inc. v. Quigg, 849 F.2d 1422, 1426-27 (Fed. Cir. 1988) (citations omitted). However, a “court is under no obligation to delay its own proceedings” where parallel litigation is pending before the PTAB. See Robert Bosch Healthcare Systems, Inc. v. Cardiocom, LLC, C-14-1575 EMC, 2014 WL 3107447 at *2 (N.D. Cal. Jul. 3, 2014). This is especially true when the Patent Office has yet to decide whether to institute IPR proceedings. See, e.g., VirtualAgility Inc. v. Salesforce.com, Inc., 759 F.3d 1307, 1315-16 (Fed. Cir. 2014) (noting that the case for a stay is “stronger after post-grant review has been instituted”); Loyalty Conversion Sys. Corp. v. American Airlines, Inc., 13-CV-665, 2014 WL 3736514 at *1-2 (E.D. Tx. Jul. 29, 2014) (Bryson, J.) (noting that the “majority of courts . . . have denied stay requests when the PTAB has not yet acted on the petition for review”).

In determining whether to stay this litigation, the Court considers three factors: “(1) whether discovery is complete and whether a trial date has been set; (2) whether a stay will simplify the issues in question and trial of the case; and (3) whether a stay would unduly prejudice or present a clear tactical disadvantage to the non-moving party.” Robert Bosch, 2014 WL 3107447 at *3 (citation omitted).

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In a CBM petition filed by petitioners PNC Bank, U.S. Bank, and Bancorp, the petitioners sought review of U.S. Patent No. 7,631,191, which claims a method of authenticating a web page. The petition challenged the validity of claims under Section 101, 103 and 112.

After finding that the ‘191 patent was a covered business method patent, the Board turned to the challenge under Section 101. Reciting the well-known categories of patentable subject matter under Section 101, including “process, machine, method of manufacture, or composition of matter,” the Board further explained that “[t]here are, however, three limited, judicially-created exceptions to the broad categories of patent-eligible subject in § 101: laws of nature; natural phenomena; and abstract ideas. Mayo Collaborative Servs. V. Prometheus Labs., Inc., 132 S. Ct. 1289, 1293 (2012).” Citing Bilski v. Kappos, 130 S. Ct. 3218, 3222, the Board explained that this test for patent-eligible under § 101 is “not amenable to bright-line categorical rules.”
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In IPR proceeding involving Medtronic, Inc. v. NuVasive. Inc., the petitioner, Medtronic, file a petition seeking review of U.S. Patent No. 8,361,156 relating to a spinal implant and methods of spinal fusion using the implant. The petition was Medtronic’s third IPR petition challenging the validity of claims in the ‘156 patent. One of the two earlier petitions was granted while the other was denied. According to Medtronic, the instant petition “remedies the deficiencies of the [earlier denied] petition, and also adds new arguments and evidence as to the length disclosure of [prior art publication to Frey].”

In its preliminary response, the patent owner argued that the petition “is essentially a duplicate of its previously denied petition.” As summarized below, the Board agreed with the patent owner and denied Medtronic’s third challenge to the validity of claims of the ‘156 patent based on “the same or substantially the same prior art or arguments” presented in the earlier, denied petition.
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In IPR proceeding First Data Corporation v. Cardsoft (Assignment for the Benefit of Creditors), LLC, the petitioner, First Data Corporation, attempted to file a petition on April 30, 2014 seeking review of U.S. Patent No. 6,934,945 assigned to Cardsoft (Assignment for the Benefit of Creditors), LLC. On May 20, 2014, the petitioner filed a corrected petition to address certain formatting issues, but, in doing so, also served the petition on the patent owner of record at the address listed in the USPTO PAIR records rather than the patent owner’s corporate address, the address where the original petition was served. On August 7, 2014, the patent owner filed its preliminary response, raising the defense that the petition was time barred under Section 315(b) because the real party in interest, VeriFone, was served with a complaint more than one year before the May 20, 2014 filing of the petition.

In 2008, the patent owner has sued VeriFone alleging infringement of the ‘945 patent. On June 8, 2012, a jury determined that VeriFone infringed the ‘945 patent and that the patent was valid. That decision was appealed to the Federal Circuit.
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In General Electric Co. v. Transdata, Inc., the patent owner requested authorization to file a motion for leave to take discovery of petitioner General Electric regarding whether GE is in privity with a defendant in litigation with the patent owner. Should the patent owner prevail and prove that GE is in privity with its customer, then the patent owner asserts that an inter partes review cannot be instituted because of the time limitations under 35 U.S.C. § 315(b), presumably because GE’s customer was served with a complaint more than one year before the petitioner filed the instant IPR petition.

The patent owner seeks the production of the following information:

(1) an indemnification agreement between Petitioner and [customer] that was claimed to be entered into around December 30, 2011; (2) any other indemnification agreements between Petitioner and [customer] regarding the Oklahoma litigation; (3) communications regarding these indemnification agreements; (4) retention agreements between Petitioner, [customer], and counsel for Petitioner and [customer] in the Oklahoma litigation; (5) the amounts of legal bills paid by Petitioner for its defense of the Oklahoma litigation; and (6) indemnification agreements between Petitioner and other defendants in the Oklahoma litigation.

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