District of Delaware Applies IPR Estoppel Provisions to Bar Party from Pursuing New Prior Art Combinations

Although not a Hatch-Waxman case, the District of Delaware’s recent ruling in Parallel Networks Licensing, LLC. v. IBM, could have a significant impact on ANDA-filers strategic approach to IPRs.  In this case, the patentee (“Parallel”) filed a complaint in 2013 asserting that IBM infringed three patents.  The litigation proceeded in federal district court; however, in August 2015, IBM filed four IPR petitions at the USPTO claiming the asserted patents were obvious. The PTAB instituted on all grounds. Ultimately, the PTAB issued final decisions finding that IBM had failed to establish that any of the challenged claims were unpatentable.

The federal district court case continued, and IBM asserted obviousness arguments that it did not assert in its IPR petitions before the USPTO.  Parallel moved for summary judgment on these defenses based on the estoppel provisions of 35 U.S.C. §315(e), which states:

The petitioner in an inter partes review of a claim in a patent under this chapter that results in a final written decision … may not assert … in a civil action … that the claim is invalid on any ground that the petitioner raised or reasonably could have raised during that inter partes review.

Id.  Noting that IBM was aware of the references that form the basis for its additional obviousness arguments, the Court granted Parallel’s summary judgment motion.  Id. at 26.  The Court reasoned that “[b]ecause IBM reasonably could have raised its prior art combinations during the IPR proceedings, it should not be able to raise them here”.

IBM argued that it did not have the opportunity to assert the obviousness defenses at issue because its IPRs were instituted based on a joinder motion to IPRs filed by Microsoft that had already been instituted. IBM argued that, “[a]s a matter of practice, where a petitioner moves to join an instituted third-party trial, the [PTAB] will only grant joinder on grounds identical to those already raised.” The court disagreed, finding that “there is no ‘mirror image’ rule for joinder.”

The primary lesson for ANDA filers is that, although seeking to join an already-instituted IPR presents a cost-effective means to gain standing to invalidate a patent, it could jeopardize any ability to defend against later infringement charges based on anticipation or obviousness.  Another lesson is that ANDA filers seeking to join already-instituted IPRs may want to consider introducing additional 35 U.S.C. §§ 102 or 103 arguments, even though it may lower the likelihood that the PTAB grants joinder.

As an aside, this Court’s decision is seemingly at odds with the scope of waiver applied by Judge Robinson in the same district.  See Intellectual Ventures I LLC et al. v. Toshiba Corp. et al. (“IV”), Civ. No. 13-453-SLR (D. Del. Jan. 11, 2017). This issue will likely be addressed by the Federal Circuit soon.