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September 29, 2021

LG Electronics, Inc. v. Mondis Technology, Ltd., Case IPR2015-00937, Paper 8

In this case, petitioner was served with a complaint alleging infringement of U.S. Patent No. 6,513,088 on two occasions. (See Paper 8 at 4.) The first complaint was served in 2008, more than one year before the date on which petitioner filed its petition requesting IPR. (Id.) The second complaint was served in 2014, less than one year before filing the petition. (Id.) Patent owner argued that the petition was time barred under AIA § 315(b) because it was filed more than one year after service of the first complaint. (Id.) The Board rejected all of the Petitioners arguments, finding “a complaint,” as used in § 315(b), to have its plain meaning. (Id. at 5.)

Section 315(b) of Title 35 of the United States Code provides, in relevant part:

 

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.

AIA § 315(b). Petitioner contended the second complaint from 2014 was “a complaint” such that it implicated this statute. (Paper 8 at 5.) Petitioner argued that “a complaint” was vague because it could be interpreted to mean any complaint. (Id.) The Board declined to insert “latest” or “second” into the statute, holding that § 315(b) “prohibits institution of an inter partes review if the petition is filed more than one year after the date a petitioner is served with ‘a’ complaint.” (Id.) Thus, the first complaint served on petitioner alleging infringement of the ’088 patent triggered the time bar, preventing the PTAB from instituting IPR of the patent. (Id.)

Second, petitioner argued that, following the dismissal of the first complaint, the parties were left in the same legal position as though the first complaint had never been served. (Id.) As a result of the first complaint, the parties entered into a settlement agreement, wherein some claims were dismissed with prejudice while others were dismissed without prejudice. (Id. at 6.) The Board found that the parties were not in the same legal position because the parties were prohibited from pursuing their prior claims and were now obligated to uphold the terms of their settlement agreement. (Id. at 6–7.)

Finally, petitioner invoked equitable principles as reasons to broadly interpret § 315(b). (Id. at 7.) Petitioner argued that, if patent owner could still assert the ’088 patent against petitioner, fairness dictates that petitioner should be permitted to file a petition now that patent owner re-asserted the ’088 patent by filing a second complaint. (Id.) Petitioner also argued that, as a matter of public policy, if a dismissal both with prejudice and without prejudice is interpreted as one that was dismissed with prejudice for purposes of § 315(b), such an interpretation would have the practical effect of deterring settlement. (Id.) The Board rejected this argument, explaining that the purpose of § 315(b) is “to ensure that inter partes review is not used as a tool for harassment by repeated litigation and administrative attacks.” (Id. (quoting Loral Space & Comms., Inc., v. ViaSat, Inc., Case IPR2014-00236, 239, 240, slip op. at 8 (PTAB Apr. 21, 2014) (Paper 7)). In this case, petitioner chose to negotiate a settlement agreement that specifically dismissed some claims without prejudice and, in any event, petitioner still has the option of filing an ex parte reexamination. (Id. at 7–8.) Thus, equitable and public policy considerations did not favor a broad interpretation of § 315(b). (Id. at 8.)

Takeaways

  1. The first complaint alleging infringement of a patent triggers the one-year time bar for filing an IPR petition on that patent under AIA § 315(b).
  2. When negotiating a settlement agreement, defendants are should seek an arrangement where all claims of patent infringement claims are dismissed with prejudice. Otherwise, the patent owner may reassert that patent at a later date when IPR is time barred.

Author

Collin Marshall | Associate | Dallas

Collin Marshall is an associate in the Dallas office of Fish & Richardson P.C. Collin has represented several clients in patent litigation suits around the country involving technology related to web-based content delivery systems, sub-sea oilfields, telecommunications devices, and data compression.... Read More