The Software IP Report

IPR Estoppel Regarding Petitioned, Non-Instituted Claims

By George Schooff

Categories: The Software IP Report, USPTO Post-Issue Proceedings

A Wisconsin district court held that 35 U.S.C. § 315(e) can estop an accused infringer from challenging a patent claim’s validity when based on a new invalidity theory, even with PTAB non-instituted claims. Douglas Dynamics, LLC. v. Meyer Prods. LLC, No. 14-cv-866-jdp (W.D. Wis. May 15, 2017).

By way of background, Meyer Products petitioned the PTAB for inter partes review of claim 6 of Douglas Dynamics’ patent asserting it “is anticipated by Keeler.”  The PTAB declined to institute a review of claim 6 on that ground.

In the district court action that followed, Meyer Products again asserted claim 6 was invalid, but this time for different reasons than those presented in its IPR petition.  Douglas Dynamics argued that Meyer Products was estopped from presenting its new theory under §315(e). 

According to Douglas Dynamics, Meyer Products’ new theory should be treated as if it were a ground that could have been raised in its IPR petition but wasn’t, and therefore subject to estoppel.  The Federal Circuit previously held that  estoppel does not apply to non-instituted grounds.  Shaw Indus. Group, Inc. v. Automated Creel Sys., Inc., 817 F.3d 1293 (Fed. Cir. 2016).  To hold otherwise, Douglas Dynamics argued, would open the door for IPR petitioners to “assert numerous bare-bones grounds in an IPR petition, knowing that those grounds would be rejected by the PTAB, but thus preserved for later use in the district court.”

First, the court noted that “invalidity grounds asserted in [a petition] in bad faith would be subject to estoppel.”  In addition, if the “thrust” of a defendant’s invalidity theory at the district court “is different from that presented in the IPR petition, the new theory is probably subject to estoppel.”  For example, “if the new theory relies on different, uncited portions of the prior art, attacks different claim limitations, or relies on substantially different claim constructions, then the new theory is tantamount to a new invalidity ground, and the court will treat it like a non-petitioned ground subject to estoppel.” 

For its part, Meyers Products argued that its “alternative invalidity theory” was presented in response to Douglas Dynamics’ new proposed claim construction.  The court declined to resolve that issue, informing the parties they are free to argue the §315(e) estoppel issue at summary judgment.  The court did say, however, “it hardly seems fair to restrict Meyer Products to the claim construction used in the IPR, if Douglas Dynamics is free to re-tool its infringement case with new claim constructions.”