Valve Corp. v. Elec. Scripting Prods., Inc.

When a different petitioner challenges the same claims of a patent already challenged in an earlier petition, the Board may apply the General Plastic factors under 35 U.S.C. § 314(a) and, in weighing them (including factor 1, "whether the same petitioner previously filed a petition directed to the same claims of the same patent"), considers any relationship between the petitioners. Where the later petitioner was a co-defendant accused on the same product and had a significant relationship with the earlier petitioner, factor 1 weighs against institution, and the Board may deny institution. The decision clarifies General Plastic Industrial Co., Ltd. v. Canon Kabushiki Kaisha, Case IPR2016-01357 (PTAB Sept. 6, 2017) (Paper 19) (precedential), by holding that its factors are not limited to multiple petitions filed by the same petitioner, and it follows NetApp Inc. v. Realtime Data LLC, Case IPR2017-01195 (PTAB Oct. 12, 2017) (Paper 9). A petitioner that files after another party's petition was denied cannot assume it is treated as a fresh first-time challenger; a related petitioner's earlier petition and the Board's institution decision can count against it, and Valve's use of that decision as a roadmap did. A patent owner can invoke General Plastic against a follow-on petition from a different but related petitioner, such as a co-defendant accused on the same product. The Board relied on Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2140 (2016), for the Director's discretion to deny institution under § 314(a). LEGAL TEST OR STANDARD: The Board applied the non-exhaustive General Plastic factors: 1. whether the same petitioner previously filed a petition directed to the same claims of the same patent; 2. 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; 3. 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 Board's decision on whether to institute review in the first petition; 4. 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; 5. whether the petitioner provides adequate explanation for the time elapsed between the filings of multiple petitions directed to the same claims of the same patent; 6. the finite resources of the Board; and 7. the requirement under 35 U.S.C. § 316(a)(11) to issue a final determination not later than 1 year after the date on which the Director notices institution of review. For different petitioners, the Board considers any relationship between them when weighing the factors. TRIGGERING FACTS: Valve's three petitions challenged claims 1-12 of the '934 patent, the same claims HTC challenged in the earlier petition (IPR2018-01031), which was denied for failure to show a reasonable likelihood of prevailing. Valve and HTC were co-defendants accused of infringing based on HTC's VIVE devices incorporating technology licensed from Valve, and Valve knew of the allegations when HTC filed. Valve filed five months after HTC's petition, after the institution decision, used the same expert, and addressed the Board's prior reasoning. Valve also filed three petitions, and its Click-to-Call explanation did not excuse the delay. KEY QUOTE: "Rather, when different petitioners challenge the same patent, we consider any relationship between those petitioners when weighing the General Plastic factors." (Paper 11, p. 2) PRIOR PRECEDENT AFFECTED: Applies and extends General Plastic Industrial Co., Ltd. v. Canon Kabushiki Kaisha, Case IPR2016-01357, slip op. at 15-16 (PTAB Sept. 6, 2017) (Paper 19) (precedential), to a different petitioner, and follows NetApp Inc. v. Realtime Data LLC, Case IPR2017-01195, slip op. at 10 (PTAB Oct. 12, 2017) (Paper 9). PRACTICE TIP: If you are a later-filing petitioner against a patent already challenged by another party, document and address any relationship with the earlier petitioner (co-defendant status, licensing, shared accused product) and explain the timing and prior art search in the petition. Do not rely on the earlier institution decision as a roadmap, because that will weigh against institution.