Cisco Systems, Inc. v. Chrimar Systems, Inc., Case IPR2018-01511, Paper 11
In this precedential case, the Board applied Click-to-Call to the petitioner’s action and denied institution because the petitioner had filed a civil action challenging the validity of the challenged patent prior to filing its petition for IPR.
An inter partes review “may not be instituted if, before the date on which the petition for such review is filed, the petitioner or real party in interest filed a civil action challenging the validity of a claim of the patent.” 35 U.S.C. § 315(a)(1). In this proceeding, Cisco challenged Chrimar’s ’760 Patent on multiple grounds. Prior to filing the IPR petition, however, Cisco had filed a declaratory action in the Eastern District of Michigan against several of Chrimar’s patents, including the ’760 Patent. Cisco then voluntarily dismissed that action without prejudice prior to filing its petition for IPR, and it argued that because it had dismissed the prior civil action before any substantive work got underway, then § 315(a)(1) did not apply.
The Board disagreed. It was not persuaded by Cisco’s multiple arguments, based on Congress’s intent and the legislative history, that the purpose of § 315(a)(1) is to avoid situations where a petitioner gets “two bites at the apple” in parallel: one in district court and one before the PTAB. The Board read the statute literally and, based on that literal reading, found that once Cisco filed the declaratory judgment action, it was thereafter barred from challenging the claims via IPR.
If you file a declaratory judgment action attacking the validity of a patent, you are barring yourself from challenging that patent via IPR—no matter what happens after you filed the suit.