A district court recently reaffirmed its ruling that statutory estoppel does not apply to grounds of invalidity that could have been included in a petition for an inter partes review but weren’t, clearing the way for the defendant to raise those grounds of invalidity against the patent at trial. Intellectual Ventures I LLC et al. v. Toshiba Corp. et al., Civ. No. 13-453-SLR (D. Del. Jan. 11, 2017). The facts in this case were discussed in an earlier post on this blog; suffice to say, the defendant Toshiba filed an IPR petition against one of the patents in suit but didn’t include a particular obviousness combination, which Toshiba now wants to present at trial.
In considering the issue in more depth, the court provides a useful summary of the current binding law on estoppel. If the PTAB institutes a ground for invalidity of a patent in an IPR, then the petitioner is estopped from raising that ground in litigation over that patent, whether or not the PTAB’s final decision covers those grounds. However, a petitioner is not estopped from raising grounds in litigation that the petitioner included in a petition but on which the PTAB did not institute review—the ruling in Shaw. See Shaw Indus. Grp., Inc. v. Automated Creel Sys., Inc., 817 F.3d 1923 (Fed. Cir. 2016).
In that summary, the court acknowledges that the present issue falls outside the existing case law: Does estoppel apply to a ground of invalidity that a petitioner-defendant could have included in a petition but didn’t? Judge Robinson, now seeing the issue as a closer call than in her earlier ruling, notes policy arguments on both sides. On the one hand, against estoppel, the PTAB has rules sharply restricting how much a petitioner can include in a petition, which weighs against making the PTAB effectively the only chance a petitioner-defendant has. On the other hand, for estoppel, a petitioner-defendant “can play games between the PTAB (IPR) and the courts (litigation), asserting some references in connection with the IPR but reserving some for litigation.”
Rather than delve into the policy arguments, Judge Robinson maintains her original ruling that estoppel does not apply, allowing the defendant Toshiba to raise the disputed obviousness grounds at trial, “with the hopes that an appeal may clarify the issue for future judges in future cases.”
Lessons for Practice
So what should a defendant in a patent suit do? To use Judge Robinson’s phrasing, play games with which references are asserted in which forum. One strategy is to sort grounds of invalidity according to how technical the argument is. A hypertechnical reading of a prior art reference is better to raise before the PTAB; a relatively easy-to-explain argument can be saved for a jury.
A second strategy is to not waste space in an IPR petition on potentially duplicative references. The PTAB looks more favorably on detailed prose explanations of grounds of invalidity, so the more space to explain each ground, the better. Since the Federal Circuit has not yet ruled on this issue, the best strategy may be to include one duplicative reference in a petition. That way, when the PTAB rejects the ground as duplicative, that ground will still be available for litigation even if the Federal Circuit overrules the order in IV v. Toshiba.