By: Jason M. Garr, John Marlott, and Greg Castanias

By statute, an IPR cannot be instituted if the petitioner, real party in interest, or its “privy” was sued for infringing the patent more than one year before the petition for the IPR.  35 U.S.C. § 315(b).  As we previously reported, in Wi-Fi One, LLC v. Broadcom Corp., 878 F.3d 1364 (Fed. Cir. 2018), the Federal Circuit en banc held that it had jurisdiction to review the PTAB’s time-bar decisions.  Last Friday, we got the first inkling of what such review will look like, as the Wi-Fi panel affirmed the PTAB’s decision on remand.  If Wi-Fi One is any indicator, the Federal Circuit’s review will be highly deferential.

The basic facts are as follows.  In 2010, Wi-Fi’s predecessor sued D-Link Systems, Inc. for patent infringement.  Three years later, Broadcom filed an IPR petition against the asserted patents.  Wi-Fi argued that D-Link and Broadcom were privies, so that the suit against D-Link time-barred Broadcom’s petition.  The Board rejected that argument, denied D-Link’s requests for related discovery, and, ultimately, invalidated Wi-Fi’s patents.  Wi-Fi appealed.  The panel initially held that the time-bar question was unreviewable, but the en banc court overturned that conclusion.  Last Friday, the panel issued its opinion on remand.

In a 2-1 decision, the Federal Circuit affirmed the PTAB’s decision.  At the threshold, the panel quoted the legislative history that the “real party in interest” is the “party or parties at whose behest the petition has been filed.”  A “privy” for purposes of Section 315(b) is broader, and codifies the common-law doctrine of estoppel.  Both the majority and the dissent appear to agree that, in theory, non-party estoppel can arise from any of the six categories set out in Taylor v. Sturgell, 553 U.S. 880, 893-95 (2008): (1) “agree[ment] to be bound”; (2) a “pre-existing substantive legal relationship[]”; (3) “adequate[] represent[ation] by someone with the same interests”; (4) parties who “assume[] control over the litigation”; (5) using a “proxy”; and (6) “a special statutory scheme.”  The panel majority appears to have found that Wi-Fi waived any arguments concerning the other Taylor factors.  In terms of the fourth factor, the panel found that Broadcom’s and D-Link’s interests were aligned, but there was no “control” relationship.  In affirming the PTAB’s denial of Wi-Fi’s requested discovery regarding the privity issue, the panel emphasized the highly deferential abuse-of-discretion standard of review, and the high burden on the party seeking discovery, i.e., requiring that discovery be in the “interest of justice.”

Judge Reyna dissented.  He believed Wi-Fi preserved its arguments as to the other Taylor factors, and he was especially frustrated that the panel found waiver “the first time the legal standard for privity under § 315(b)” was being decided by the Federal Circuit.  Giving proper consideration to all the “highly fact-dependent” Taylor factors, Judge Reyna believed the PTAB abused its discretion in denying further discovery.

Interestingly, the judges in the majority, Judges Bryson and Dyk, who affirmed the PTAB’s decision at the panel level, were two of the judges who thought the PTAB’s decision was unreviewable in the first place.  See Wi-Fi, 878 F.3d at 1377 (dissent).  Judge Reyna, who dissented at the panel level, believing that the Board had abused its discretion, authored the en banc opinion concluding that the PTAB’s decision is reviewable.  See id. at 1367.

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Greg Castanias, head of Jones Day's Federal Circuit team, has almost 30 years' experience as a leading appellate and intellectual property litigator. A fellow of the American Academy of Appellate Lawyers, his experience includes five Supreme Court arguments, close to 70 Federal Circuit arguments, and countless others in federal and state courts across the nation, from Alaska to Connecticut.