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Oct. 13 — A challenge to the validity of a patent can be combined with another challenge on a different basis that the petitioner had raised in an earlier proceeding, the Patent Trial and Appeal Board ruled Oct. 5.
In a 3-2 ruling, the board rejected the argument that Section 315 of the America Invents Act doesn't allow a petitioner to combine issues from its previous inter partes review proceedings on the same patent.
A dissenting opinion said that the plain language of the statute mentioned only the joining of parties, and allowing the joining of new issues was an exercise of power “beyond that granted by Congress.”
Practitioners who spoke to Bloomberg BNA said that the decision should make the PTAB more consistent and predictable while reducing gamesmanship by patent owners.
Zhongshan Broad Ocean Motor Co. moved for joinder of its PTAB petition to cancel Nidec Motor Corp.'s patent claims with an earlier-instituted PTAB proceeding involving the same parties and patent claims, but different grounds for cancellation.
35 U.S.C. § 315(c) says that the PTAB “may join as a party to that inter partes review any person who properly files a petition” that the board “determines warrants the institution of an inter partes review.”
The board had originally said that Section 315(c) precluded the joining of the cases because “ ‘join as a party' indicates that only a person who is not already a party to an instituted inter partes review can be joined to the proceeding.”
Zhongshan filed a request for rehearing, arguing that the statute covered parties to existing cases, as well as the joinder of new issues.
The board agreed with Zhongshan on reconsideration. The board said that Section 315(c) allowed the joining of “any person who properly files a petition,” even if they are already a party to an earlier instituted review.
The board also determined that the language of the statute covered issue joinder, including “new grounds of unpatentability.”
The dissent, however, said that the majority had failed to explain why the statute would allow joinder of issues, when it only refers to joining parties.
Scott McKeown of Oblon McClelland Maier & Neustdadt LLP, Alexandria, Va., told Bloomberg BNA this decision should bring more consistency to PTAB proceedings and reduce gamesmanship by patent owners.
A previous PTAB case—Target Corp. v. Destiny Maternity Corp., No. IPR2014-00508 (P.T.A.B. 2015)—produced a similar 4-3 result, which meant afterwards that “depending on which judges were on the panel, you might get issue joinder as statutory, and you might not,” McKeown said.
McKeown said that this decision reinforces that the PTAB considers Section 315(c) to cover issue joinder, in line with a PTO brief to the Federal Circuit and report to Congress request a specific issue joinder provision.
“The message here is that issue joinder is statutory, and we shouldn't see any denials on that basis going forward,” McKeown said, and that denials should only be based on the facts of the case from now on.
McKeown also said that this decision should “prevent unscrupulous patentees from playing amended complaint games.”
These “games,” McKeown said, normally involve a patent owner suing a party for infringement of multiple patent claims, followed by the party petitioning the PTAB for cancellation of those claims.
For example, if the patent owner asserted that the party infringed claims 1-15, and the PTAB only instituted review on claims 1-10, the patent owner would then amend its infringement complaint to only cover claims 11-15.
Because the America Invents Act disallows PTAB petitions filed over 12 months after an infringement claim, the only way for the petitioner to continue the case would have been to add those claims through issue joinder.
Had the PTAB denied issue joinder based on its interpretation of Section 315(c), the proceeding would have effectively been ended.
McKeown said the Zhongshan decision would cut down on these “games,” because patent owners “know that this strategy will no longer work” because of the statutory allowance for issue joinder
Justin Oliver of Fitzpatrick Cella Harper & Scinto LLP, Washington, told Bloomberg BNA in an e-mail that the decision “may not result in any changes in common practices” for PTAB practitioners, who have historically tried to avoid issue joinder altogether.
“I expect that practitioners will still strive to avoid situations in which that joinder exception is needed, particularly given the fact that the statute makes joinder decisions discretionary. However, when there is a unique set of facts, as there was in Zhongshan Broad Ocean, the ruling will give petitioners another avenue to consider with respect to adding grounds to an existing petition,” Oliver said.
Administrative Patent Judge James A. Tartal wrote the opinion, joined by Judges Sally C. Medley and Justin T. Arbes. Administrative Patent Judge Patrick M. Boucher wrote the dissent, joined by Judge Benjamin D.M. Wood.
Zhongshan was represented by Steven F. Meyer of Locke Lord LLP, New York. Nidec was represented by Scott R. Brown of Hovey Williams LLP, Overland Park, Kan.
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