In Metrics, Inc.v. Senju Pharmaceutical Co., Ltd., IPR2013-01041, Paper 8, and IPR2013-01043, Paper 8 (August 15, 2014), at patent owner’s promoting, the Board found fault with the petitioners first amended petition, and required a second amended petition.  The petitioenr was also required to refile a new set of exhibits, numbered beginning with Ex. 1001, and numbering each page of each exhibit.

New Filings

Zerto, Inc. filed IPR2014-01295 challenging U.S. Patent No. 7,971,091, assigned to EMC Corporation.

Rehearings

In CustomPlay, LLC v. Clearplay, Inc., IPR2014-00339, Paper 15 (August 15, 2014), the Board denied rehearing of its decision instituting inter partes review of claims 1, 2, and 4–9 of U.S. Patent No. 7,526,784.

In Square, Inc. v. REM Holdings 3, LLC, IRP2014-00312, Paper 20 (Augist 14. 2014) the patent owner was seeking evidence of secondary considerations.  The Board denied additional discovery, but found that the patent owner made sufficient showing to entitle them to some information from Petitioner regarding sales figures.  A party seeking additional discovery must show more than a possibility or mere allegation that something useful will be found, but this does not meant that the requester must prove conclusively that they will win on the merits before any discovery will be granted.

The Board directed the parties to meet and confer on the issue of discovery and attempt to agree on a reasonable amount of information to produce. In the alternative, the Board said that petitioner may offer to stipulate to certain facts, such as sales figures, in order to avoid producing sensitive documents.  If the parties could not reach an agreement, the patent owner was authorized to renew the motion.

On August 14, 2014, Law360 quoted PTAB Chief Judge James Smith commenting that the Board’s reputation as a patent “death squad” – a phrase coined by former Federal Circuit Chief Judge Randall Rader.  While “death squad” is “unfortunate language,” in some ways it adequately describes the mission Congress gave the board under the AIA.  While the rate of declaration dropped from 87 percent in fiscal 2013, to 76 percent in fiscal 2014, the rate of filing continues ot increase.

In TD Ameritrade Holding Corp. v. Trading Technologies International, Inc., CBM2014-00131, Paper 11 (August 14, 2014), believing it caught Petitioner in a failure to disclose prior inconsistent statements, the Patent Owner sought “guidance” from the Board.  The Board merely reiterated the rule, directing the patent owner to 37 C.F.R. § 42.51(b)(1)(iii), which states “[u]nless previously served, a party must serve relevant information that is inconsistent with a position advanced by the party during the proceeding concurrent with the filing of the documents or things that contains the inconsistency.”

Routine discovery under 37 C.F.R. §41.51(b)(1)(iii) is narrowly directed to specific information known to the responding party to be inconsistent with a position advanced by that party in the proceeding, and not broadly directed to any subject area in general within which the requesting party hopes to discover such inconsistent information.”  Thus disclosure depends not only on the good faith of an opponent to make the disclosure, but to identify the inconsistency to begin with.

There is a duty to disclose inconsistent statements, but no real sytem to identify or enforce these disclosures.

In Schott Gemtron Corporation v. SSW Holdings Company, Inc., IPR2014-00367, Paper 20 (August 13, 2014), the Board denied patent owner’s motion for additional discovery relating to commercial success.  The Board noted the legislative history of the AIA makes clear that additional discovery should be confined to “particular limited situations, such as minor discovery that PTO finds to be routinely useful, or to discovery that is justified by the special circumstances of the case,” and as the justification for being conservative in authorizing additional discovery.

The Board found the patent owner had not met its burden to demonstrate that discovery of the requested financial information is necessary in the interest of justice, failing to show that the sales level of Petitioner’s constituted commerical success, and a nexus between the claimed inventions and any commercial success of Petitioner’s products. While a conclusive showing of either is not necessary at this stage, some evidence is needed to establish that there is more than a mere possibility that Patent Owner’s request would uncover something useful.

About the nexus the Board said that a patent owner must offer “proof that the sales [of the product] were a direct result of the unique characteristics of the claimed invention—as opposed to other economic and commercial factors unrelated to the quality of the patented subject matter.” In re Huang, 100 F.3d 135, 140 (Fed. Cir. 1996). In addition, “if the commercial success is due to an unclaimed feature of the device,” or “if the feature that creates the commercial success was known in the prior art, the success is not pertinent.” Ormco, 463 F.3d at 1312; see also In re Kao, 639 F.3d 1057, 1070 (Fed. Cir. 2011) (requiring a determination of “whether the commercial success of the embodying product resulted from the merits of the claimed invention as opposed to the prior art or other extrinsic factors”).

SCHOTT Gemtron Corporation

SSW Holdings Company, Inc. of

New Filings

CaptionCall, LLC filed IPR 2014-01287 challenging U.S. Patent No. 7,660,398 assigned to Ultratec, Inc.

Aruze Gaming Macau, Ltd. filed IPR2014-01288 challengnig U.S. Patent No. 7,892,088 assigned to MGT Gaming, Inc.

Institution Decisions

In Fidelity National Information Services Inc. v. Datatreasure Corp., IPR2014-00489, Paper 9 (August 13, 2014), the Board denied inter partes review of claims 22-25, 36-50, and 66-123 (“the challenged claims”) of U.S. Patent No. 5,910,988..

In Fidelity National Information Services Inc. v. Datatreasure Corp., IPR2014-00490, Paper 9 (August 13, 2014), the Board denied inter partes review of claims 1, 2, 9, 11-27, 29-32, 34-46, 48-52, 54-58, 60-64, 66, and 67 (“the challenged claims”) of U.S. Patent No. 6,032,137.

In Fidelity National Information Services Inc. v. Datatreasure Corp., IPR2014-00491, Paper 9 (August 13, 2014), the Board denied inter partes review of claims 1, 2, 9, 11-21, 26, 27, 29-32, 34, 35, 51-53, 55-62, 64, and 65 (the challenged claims) of U.S. Patent No. 5,910,988.

In Macronix International Co., Ltd. v. Spansion LLC, IPR2014-00898, Paper 13 (August 13, 2014), the Board instituted inter partes review of claims 7 and 14 of U.S. Patent No. 7,151,027.

Rehearings

In TRW Automotive US LLC v. Magna Electronics, Inc., IPR2014-00265 , Paper 17 (August 13, 2014), the Board denied rehearing of its decision declining to institute inter partes review of claims 28–38 of U.S. Patent No. 8,222,588.

In eBay Inc. v. Lockwood, CBM2014-00025, Paper 34, CBM2014-00026, Paper 35  (August 12, 2014) the Board denied eBay’s motion to expunge the declaration of its expert, directed to unpatenability of the prior art, which eBay claimed was unnecessary since the Board only instituted the proceeding on indefiniteness.  The patent owner objected because the expert “construed the claims and applied the cited art from the perspective of a person of skill in the art (‘POSA’), demonstrating that a POSA would understand the [metes] and bounds of the claims.”

While parties are permitted to take inconsistent positions, as a practical matter it can sometimes backfire.

In Groupon Inc. v. Maxim Integrated Products, Inc., CBM2014-00090, Paper 10 (August 12, 2014), the Board reminded the parties that any agreement or understanding between the patent owner and the petitioner, including any collateral agreements referred to in such agreement or understanding, made in connection with, or in contemplation of, the termination of the proceeding shall be in writing, and a true copy of that agreement or understanding shall be filed in the Office. 35 U.S.C. § 327(b). The Board added that in order to ensure compliance with 35 U.S.C. § 327(b), and based on the facts of this proceeding, the parties are required to certify in writing that there are no other written or oral agreements or understandings, including any collateral agreements, between them, including but not limited to licenses, covenants not to sue, confidentiality agreements, payment agreements, or other agreements of any kind, that are made in connection with, or in contemplation of, the termination of the instant proceeding. To the extent that there are other agreements as outlined immediately above, the parties shall file such agreements and may request that any such agreement be treated as business confidential information and be kept separate from the files of the involved patent. 37 C.F.R. § 42.74(c).

In Micro Motion, Inc. v. Invensys System, Inc., IPR2014-00179, Paper 22, IPR2014-00167, Page 24  (August 11, 2014), the Board informed the patent owner that it must address each proposed substitute independent claim in the Motion to Amend, itself, but that it may provide a claim listing that includes proposed substitute dependent claims that only are amended to depend from each new, substitute independent claim. The Board indicated that such a claim listing does not count towards the fifteen page limit for a Motion to Amend.