ZTE Corp. v. ContentGuard Holdings Inc.

Informative decision only: persuasive authority, not binding precedent. When a petitioner whose earlier timely petition on the same claims was not instituted files a second petition outside the one-year period of 35 U.S.C. § 315(b) with a joinder motion under § 315(c) that is denied, and the second petition presents the same or substantially the same prior art or arguments, the Board may deny institution under 35 U.S.C. §§ 314(a) and 325(d) and 37 C.F.R. § 42.108(b) absent extraordinary circumstances. Section 325(d) permits the Director to "take into account whether, and reject the petition or request because, the same or substantially the same prior art or arguments previously were presented to the Office." No prior precedent directly addressed this issue in the text; the decision cites no earlier Board decision. For a petitioner, a time-barred second petition cannot rely on a joinder motion as a safety net: once joinder is denied, the Board treats the petition as a stand-alone second attempt against claims the petitioner already failed to get instituted, and it will likely be denied. The Board also rejected arguments that the same panel, the same parties and overlapping issues justify an accelerated schedule, and that 37 C.F.R. § 42.1(b) favors instituting to avoid the cost of other forums. For a patent owner, the decision supports opposing a repeat petition by stressing the burden and inequity of defending the same claims twice against the same petitioner, even before filing a preliminary response. The Board relied only on the statutes and regulations it cited (35 U.S.C. §§ 314(a), 315(b), 315(c), 325(d); 37 C.F.R. §§ 42.1(b), 42.108(b)) and cited no Federal Circuit, CCPA or Supreme Court authority. LEGAL TEST OR STANDARD: The Board exercised discretion under 35 U.S.C. §§ 314(a), 325(d) and 37 C.F.R. § 42.108(b), which allows it to "deny some or all grounds for unpatentability for some or all of the challenged claims." It considered four things: (1) that ZTE already had filed timely a petition for inter partes review of claims 1-11 and 23-29 of the '160 patent in IPR2013-00134 and failed to have inter partes review instituted on those claims; (2) that the petition was filed outside the one-year period provided in 35 U.S.C. § 315(b) for petitions filed in the absence of a motion for joinder under 35 U.S.C. § 315(c); (3) that the motion for joinder filed with the instant petition has been denied; and (4) that the petition presents the same or substantially the same prior art or arguments previously presented in the first petition. Absent an extraordinary circumstance, subjecting the patent owner to the new challenge is unjust and inequitable. TRIGGERING FACTS: ZTE's first petition in IPR2013-00134 challenged claims 1-38, and review was instituted only on claims 12-22 and 30-38. The second petition challenged claims 1-11 and 23-29, the claims not instituted, and was filed outside the one-year period. Its joinder motion with IPR2013-00134 was denied, and the first proceeding had ended by a judgment entered August 6, 2013 on the Patent Owner's request for adverse judgment, with no rehearing request. ZTE conceded that half the grounds used the same references as the first petition and the rest simply combined O'Callaghan with references from the first petition. ZTE showed no extraordinary circumstance. KEY QUOTE: "Without any extraordinary circumstance, it would be unjust and inequitable to subject the Patent Owner to a new challenge by a Petitioner who unsuccessfully had attempted to institute inter partes review on the claims in a previous petition, if the second petition is not itself filed within the one-year period provided in 35 U.S.C. § 315(b) and if a joinder motion has been denied." (Paper 12, p. 6) PRIOR PRECEDENT AFFECTED: No prior precedential or informative decision is directly affected. PRACTICE TIP: Do not file a second petition on claims that were denied institution in a first petition after the § 315(b) one-year period has run, expecting a joinder motion to save it. If you must file one, plead extraordinary circumstances and explain why the prior art and arguments are not the same or substantially the same as those in the first petition. Patent owners should stress the § 315(b) timing, the denied joinder and the overlap with the first petition.