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IP Alert
IP Alert: PTAB Issues Rare Discretionary Denial

July 2, 2018

On June 27, in American Honda Motor Co., Inc. vs. Intellectual Ventures II LLC, the Patent Trial and Appeal Board (PTAB) used its rarely exercised discretionary authority to deny institution of inter partes review (IPR) proceedings. The PTAB concluded that institution was unwarranted in view of a previously initiated IPR that the petitioner had later joined.

On June 9, 2017, a third party filed an IPR proceeding to challenge U.S. Patent No. 7,154,200, which is owned by Intellectual Ventures (“IV”). On December 21, 2017, Honda, the petitioner, filed a second petition to challenge a subset of claims challenged in the third-party IPR. The second petition asserted a first ground of invalidity based on a reference (Senju) not used in the first IPR and a second ground combining Senju with a reference (Koizumi), which was relied upon in the first IPR. On January 12, 2018, Honda filed a third IPR and moved to join the first IPR. The PTAB granted this motion on April 25, 2018.

In considering whether to institute the second IPR, the PTAB applied the factors set forth in the 2016 PTAB decision Gen. Plastic Indus. Co. v. Canon Kabushiki Kaisha, along with two additional factors. The factors, findings, and the PTAB’s determination are summarized in the table below.   


Findings Determination

Whether the same petitioner previously filed a petition directed to the same claims of the same patent

The third IPR, joined with the first IPR, is considered a petition directed to the same claims.

Moderately against institution

Whether at the time of filing of the first petition the petitioner knew of the prior art asserted in the second petition or should have known of it

Honda may have been monitoring litigations involving the patent at issue, which would have apprised petitioner of the Koizumi reference. Low weight against institution

Whether at the time of filing of the second petition the petitioner already received the patent owner’s preliminary response to the first petition or received the PTAB’s decision on whether to institute review in the first petition

The preliminary response and the institution decision in the first IPR preceded the filing of the second IPR. Honda’s citations to Koizumi in the obviousness ground reveals that they mimic positions from the Koizumi obviousness ground in the first IPR. Strongly against institution

The length of time that elapsed between the time the petitioner learned of the prior art asserted in the second petition and the filing of the second petition

Honda knew or should have known of Koizumi, but no evidence on record indicates when Honda learned of Senju. Neutral

Whether the petitioner provided adequate explanation for the time elapsed between the filings of multiple petitions directed to the same claims of the same patent

Honda was served with a defective district court complaint nine months before the filing of the petition, but the petition was filed within two months of the operative complaint. Neutral

The finite resources of the PTAB

Honda uses two separate petitions against the same claims. Low weight against institution

The requirement under 35 U.S.C. § 316(a)(11) to issue a final determination not later than one year after the date on which the Director notices institution of review.

The PTAB can meet the requirement of issuing a final determination within one year. Low weight favors institution

Whether there is potential prejudice to the petitioner if the petition is denied

Honda can proceed against the challenged claims in the first even if the other petitioner entities were to withdraw. Moderately against institution

Patent owner’s activity

IV sought to enforce the patent in multiple actions resulting in multiple IPR petitions. Slightly favors institution

Considering these factors, the PTAB concluded that the factors collectively weighed against institution. The PTAB was swayed particularly by the fact that Honda chose to file two separate petitions and that the petition in this case overlaps the other insofar as it relies on the same reference, Koizumi, in a similar way. The PTAB further noted that the petitioner can continue its challenge of the same claims in the first IPR.

This decision is notable in that Honda’s strategic decision to file the third petition and motion to join the first IPR ultimately resulted in the denial of the second petition. Notably, although Honda can challenge the same IV claims in the first IPR, it is likely that Honda cannot rely on the Shenju reference as a ground for invalidity in that proceeding. The decision illustrates that the PTAB heavily disfavors relying on the same reference in multiple IPR petitions even if the reference is only used as a secondary reference in an obviousness combination with a new reference. Petitioners should carefully consider this case in strategizing filings and selecting references when multiple IPRs are involved with the same patent.

If you have any questions regarding this decision, please contact Fitch Even partner Karen J. Wang, author of this alert.

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