How Long Is Too Long To Wait To Settle?

by | Mar 30, 2023 | Final Written Decisions, PTAB News, PTAB Trial Basics

By Sue Gerber and Matt Johnson –

An IPR “shall be terminated with respect to any petitioner upon the joint request of the petitioner and patent owner, unless the Office has decided the merits of the proceeding before the request for termination is filed.”  35 U.S.C. § 316(a).  We have previously written about the situation where a request to terminate was denied because the PTAB had already decided the merits of the proceeding.  Be Advised: Settlement Does Not Necessarily End An IPR Or PGR.  This begs the question:  How close to the Final Written Decision deadline can parties wait before settling a case?  The PTAB’s decision in Arnold & Richter Cine Technik GmbH & Co. Betriebs KG v. Rotolight Ltd., IPR2021-01496, IPR2021-01497, IPR2021-01498, and IPR2022-00099, Paper No. 40 (P.T.A.B. Jan. 30, 2023), provides another data point toward answering this question.

In Arnold, the parties moved to terminate the four pending IPRs on January 13, 2023, approximately one month after the PTAB had held a consolidated oral hearing on three of the cases and approximately one month before the last oral hearing was scheduled to take place.  One day later, an uninvolved third party, VPS, emailed the PTAB alleging that “termination of these proceedings is not appropriate and contrary to the public interest.”  Paper No. 40 at 2.

The PTAB rejected VPS’s argument and terminated the proceedings.  Turning first to the question of whether the Office had decided the merits of the proceeding before the request for termination had been filed, the PTAB rejected VPS’s speculation that “there is a high likelihood that the Board has already decided the merits of the proceedings,” id. at 3, stating that while progress had been made on the cases, a decision had not yet been made, id. at 6.  Moreover, the PTAB noted that only three of the four cases had gone to oral hearing and the deadline for the oral hearing and final written determination in the last case was months away.

As far as VPS’s public interest claim, the PTAB determined that the public interest weighed in favor of termination.  Acknowledging that VPS may have had a personal interest in having the PTAB decide the issues, the PTAB noted that VPS could have brought parallel IPRs “as a back-up or understudy petitioner in the event of a settlement between the parties,” and, in all events, VPS was not time barred from bringing its own IPRs later.  On balance, the PTAB was hesitant to undermine the parties’ negotiations in reaching a comprehensive settlement by refusing to terminate the IPRs.

Takeaway:  Because a settlement and a joint request to terminate will not guarantee an end to the proceedings, parties are advised to consider settlement early in the process and move quickly once an agreement is reached.  Generally, the earlier in time a termination request is submitted, the greater the chance the PTAB will agree to end a post-grant challenge.

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Matthew Johnson

Partner at Jones Day
Matt Johnson is one of the Firm's primary contacts on practice before the PTAB. Currently co-chairing the Firm's PTAB subpractice and involved in proceedings at the Board since the first day of their availability in September 2012, Matt regularly represents clients as both petitioners and patent owners at the Board. He further works as an advocate for clients in appeals from Board proceedings at the Federal Circuit.