Patent Risk Defense Group RPX Can’t Appeal Patent Challenge Loss

Access practice tools, as well as industry leading news, customizable alerts, dockets, and primary content, including a comprehensive collection of case law, dockets, and regulations. Leverage...

By Tony Dutra

RPX Corp., which boasts a high success rate challenging patents at the patent office, can’t appeal an unsuccessful challenge, a federal appeals court held Jan. 17.

The U.S. Court of Appeals for the Federal Circuit rejected RPX’s argument that it had standing because a loss at the Patent and Trademark Office is an injury to its reputation. Before losing its challenge to ChanBond LLC’s telecommunications patent, RPX claimed a 95 percent success rate in getting the PTAB to institute trial and a 100 percent rate of success in trial.

The court held in 2014 that advocacy associations generally lack standing to appeal PTAB losses. The current ruling extends that deficiency to companies like RPX, known as “non-defendent filers” of PTAB petitions.

San Francisco-based RPX is a member organization for companies at risk of being sued for patent infringement. RPX established its program challenging patent validity at the Patent Trial and Appeal Board after the America Invents Act of 2011 (AIA) established the inter partes review (IPR) procedure.

The AIA allows both alleged infringers and non-defendant parties to file IPR petitions. A losing party can appeal to the Federal Circuit under 35 U.S.C. §319, but it must have standing in the federal court system, which requires showing that it suffered an injury.

AIA Challenges No Different

The court held in 2014 in Consumer Watchdog v. Wisconsin Alumni Research Foundation that the advocacy group lacked standing to appeal its unsuccessful challenge to a stem cell patent via the inter partes reexamination procedure. IPRs replaced inter partes reexaminations. The court affirmed that IPRs would be treated the same in Phigenix, Inc. v. Immunogen, Inc. The court ruled that an appellant couldn’t claim injury simply based on its statutory rights under Section 319.

RPX argued that the loss was a competitive injury. RPX competes with other groups offering IPR challenge programs— Unified Patents Inc. and Askeladden LLC —for members. The lack of standing didn’t specifically create a disadvantage for RPX versus its competitors, the court said.

RPX didn’t immediately respond to Bloomberg Law’s request for comment on the court’s ruling. A spokesman for Askeladden said the organization had no comment.

“While this particular standing challenge was successful, it is non-precedential, the law of standing is complex, and there are many varied ways to prove concrete and particularized injury-in-fact that the court has yet to address,” said Jonathan Stroud, Unified’s chief patent counsel. “We look forward to seeing how this complex and ever-changing area of the law develops at the Federal Circuit in the wake of the groundbreaking Phigenix case.

The Federal Circuit’s decisions only apply to non-defendant parties who fail at the PTAB. When the non-defendant party wins at the PTAB, the court will allow that challenger to participate in the patent owner’s appeal, defending the PTAB’s decision, per Personal Audio, LLC v. Electronic Frontier Foundation.

Judge Richard Linn wrote the court’s opinion, which was joined by Judges Jimmie V. Reyna and Todd M. Hughes.

Pierce Atwood LLP and Klarquist Sparkman LLP represented RPX. Mishcon de Reya New York LLP represented ChanBond.

The case is RPX Corp. v. ChanBond LLC , Fed. Cir., No. 2017-2346, unpublished 1/17/18 .

To contact the reporter on this story: Tony Dutra in Washington at adutra@bloomberglaw.com

To contact the editor responsible for this story: Mike Wilczek at mwilczek@bloomberglaw.com

Copyright © 2018 The Bureau of National Affairs, Inc. All Rights Reserved.

Request Intellectual Property on Bloomberg Law