Federal Circuit on PTAB Initiation Decisions: Still No Appeal …

Wi-Fi One v. Broadcom (Fed. Cir. 2016)

Wi-Fi One is the new owner of Ericcson’s U.S. Patent No. 6,772,215 that covers a method for encoding and sending packet-receipt error messages over the internet. In 2013, Broadcom brought this IPR challenge and the Board eventually found many of the claims anticipated.

On appeal here Wi-Fi challenges Broadcom’s standing to bring the IPR challenge under 35 U.S.C. § 315(b).  Section 315(b) indicates that an IPR proceeding may not be instituted if the petitioner (or its privy) had been served with an infringement complaint more than one year prior.

315(b) Patent Owner’s Action.— An inter partes review may not be instituted if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent.

Although Broadcom had not been previously sued on the patent, Wi-Fi argues that its privies had been previously sued.  The PTAB rejected that argument – finding that Broadcom was not a “privy” of the prior litigants because Wi-Fi did not prove that Broadcom had power to control the prior district court litigation or that Broadcom would be bound by the outcome of that prior litigation. The Board also refused Wi-Fi’s request for further discovery on the matter.

On appeal, the Federal Circuit affirmed — holding that the question of proper institution is unreviewable based upon the statutory statement that “The determination by the Director whether to institute an inter partes review under this section shall be final and nonappealable.” 35 U.S.C. § 314(d).  Although I have not quite found the line in the decision, is appears that the court also held that even the denial of discovery is unreviewable.

The Supreme Court extended the preclusion of judicial review to statutes related to the decision to institute; it did not limit the rule of preclusion to substantive patentability determinations made at the institution stage, as the facts of Cuozzo itself make clear.

Slip Opinion at 8.  The decision here essentially follows the Federal Circuit’s prior ruling in Achates.

The court also sided with the Board on Wi-Fi’s substantive argument – affirming the Board decision that the prior art anticipates.