By Emily Tait –
When an IPR petition results in a final written decision, the IPR petitioner (or the petitioner’s real party in interest or privy) is estopped from asserting in a civil litigation or an ITC action that “the claim is invalid on any ground that the petitioner raised or reasonably could have raised during that inter partes review.” 35 U.S.C. § 315(e)(2). While this statutory provision typically arises when a patent holder seeks to estop a defendant/petitioner from asserting in litigation an invalidity theory that the defendant/petitioner lost at the PTAB, what happens when the defendant/petitioner’s invalidity theory prevailed at the PTAB? Can the patent holder then estop the defendant from asserting that invalidity theory in a civil action?
This question is currently before the Federal Circuit in BTG Int’l Ltd., et al. v. Amneal Pharma. et al., No. 19-1147 (consol.). On December 3, Appellants (collectively referred to here and in the Appellants’ brief as “Janssen”) filed their opening brief, arguing that the district court erred in considering Defendants’ obviousness challenge by “refusing to apply 35 U.S.C. § 315(e)(2).” Janssen argues that the statutory language is clear: parties are forbidden from pursuing obviousness challenges in district court that were raised, or could have been raised, in an inter partes review proceeding in which the PTAB has issued a final written decision, and this prohibition applies irrespective of whether that party’s obviousness challenge was or was not successful at the PTAB.
The district court had grappled with this issue in an extensive footnote in its underlying opinion and order. BTG, Int’l, No. 15-cv-5909 (D. N.J. Oct. 31, 2018), Dkt. __, at 27 n. 13. Acknowledging that § 315(e)(2) “concededly may be read” in the manner Janssen proposes, the court nevertheless concluded that the “manifest statutory intent . . . is to prevent abuse of inter partes proceedings, through the withholding of grounds and presentation of serial challenges.” Id. The court ultimately could “not accept, . . . that Congress intended to require a party to stand mute in court because it previously prevailed on the same issue before the PTAB.” Id. Taking the contrary position advocated by Janssen would potentially mean that the court would “find itself in the position of being required to enter an injunction against infringement based on a patent already found invalid.” Id.
On appeal, Janssen argues inter alia that the district court erred by substituting its own view of sound policy for “the policy reflected in an unambiguous statute.” BTG, No. 19-1147, Doc. 77, at 23. Further, Janssen argues that applying the statute as written does not lead to absurd results as suggested by the district court, but is instead entirely consistent with Congressional intent, which was to provide the IPR process as an alternative to district court litigation. Id.at 24.
Appellees’ response brief is currently due early next month and oral argument is scheduled for January 24, 2019. However, it is likely that the briefing and argument schedule will be revised due to the PTAB’s recent denial of Janssen’ s requests for rehearing. Indeed, in a filing submitted the day after Janssen’s opening brief, Appellees informed the Court that, in view of Janssen’s stated intent to appeal the PTAB’s decisions, Appellees would be filing a motion asking the Court to vacate its existing briefing and argument schedule, designate the current appeal and the IPR appeals as companion cases, and order a consolidated, expedited briefing and oral argument schedule for both sets of cases.
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