POST-GRANT PROCEEDINGS
“A FIRST ENTITY CANNOT PAY A SECOND ENTITY TO FILE A REQUEST FOR A POST-GRANT PROCEEDING AND HAVE THE SECOND ENTITY NAMED SOLELY AS THE RPI.”
defining an RPI and privy, listing all RPIs for instituting one of
and correctly these
proceedings, are significant considerations before initiating a post-grant proceeding.
Limited guidance
According to most legal defi nitions, the ‘real party in interest’ means the person or entity whose rights are involved, who has the legal right under applicable substantive law to enforce the claim in question, and who generally, though not necessarily, stands to gain from the petition, proceeding or lawsuit. ‘Privity’ is defi ned as the mutual or successive relationship to the same rights of property; ‘privy’ is one who takes part in, or has an interest in, the proceeding.
In the context of patent law and the AIA post- grant proceedings, the USPTO explained that a common consideration in determining an RPI or privy is “whether the non-party exercised, or could have exercised, control over a party’s participation in a proceeding”. Further: “The concept of control generally means that ‘it should be enough that the non- party has the actual measure of control, or opportunity to control, that might reasonably be expected between two formal co-parties’.”
On April 9, 2012, Verizon Communications, Google and several others provided comments to the USPTO publication for adopting a proper definition of RPI and privy. The comments propose a “control-focused” approach, and that merely participating in litigation to invalidate a patent does not automatically qualify that entity as an RPI or privy. Generally, the comments advocate that the non-party RPI should assume control over the post-grant proceeding, and the control is significant enough that the non-party will have “had his day in court”. Non-party estoppel should be the “narrow exception”.
www.worldipreview.com
In response, Chief Judge James Donald Smith at the Board of Patent Appeals and Interferences of the USPTO gave some limited guidance towards defi ning an RPI and privy:
“Who constitutes an RPI or privy is a highly fact-dependent question ... Courts and commentators agree that there is no ‘bright- line test’ for determining the necessary quantity or degree of participation to qualify as an RPI or privy based on the control concept. … Accordingly, the Office has not enumerated particular factors regarding a ‘control’ theory of ‘RPI’ or ‘privy’ in the proposed rules. Instead, to resolve an RPI or privy dispute that may arise during a proceeding, the Board plans to consider each case on its specific facts.”
In short, at this point, the USPTO has not defi ned the meaning of RPI and privy, there is no bright- line rule for doing so, and it will instead make such determinations on a case-by-case basis.
Determining the RPI and privy Generally,
the RPI is the person or entity who
controlled, or who could have exercised control over, the fi ling of the petition for PGR or IPR as well as the proceeding, provided the entity is eligible to fi le a petition for post-grant review under 35 USC §321(a) or inter partes review under 35 USC §311(a). T e privy of the petitioner cannot mean simply having an interest in the PGR or IPR. Instead, at the very least, the privy means an entity that assisted with, or assumed, the control of the PGR or IPR.
However, ‘control’ can be defi ned in diff erent ways. For instance, control could be considered as:
• Unilaterally making the petitioner’s strategic decisions (ie, which post-grant proceeding to pursue; the grounds of unpatentability to set forth in the request; which patent claims to attack; timing of fi ling the post-grant petition; which RPIs to list in the initial request);
• Deciding what legal theories are to be advanced (ie, lack of compliance with 35 USC §§101, 102, 103, 112, fi rst paragraph), including what prior art and evidence to submit; and
• Deciding whether to seek further review (ie, appeal to the Federal Circuit).
Still, and arguably, the mere contribution of funds or advice regarding the petition is not suffi cient to become an RPI or privy. Payment does not necessarily equal control.
Also, a
fi rst entity cannot pay a second entity to fi le a request for a post-grant proceeding and have the second entity named solely as the RPI (see the In re Guan Inter Partes Reexamination Proceeding, also known as the Troll-Busters case).
Further, the mere connection to the petitioner through a mutual membership such as a joint defence agreement or other association should not be sufficient to become an RPI or privy. Except for the fact that multiple parties are sued for infringing the same patent, a joint defence agreement can protect privileged information, save costs and encourage settlement with the patent owner. Merely signing a joint defence agreement or being named as a joint defendant should not mean that entity can automatically be an RPI or privy in an AIA post-grant proceeding.
Although the USPTO has declined to provide a bright-line rule on defi ning an RPI or privy, there are some signifi cant factors that can be relied upon for such determinations. Any clearer guidance may lie in future USPTO post-grant proceeding decisions, or from the courts themselves.
Eugene Perez is a partner at Birch, Stewart, Kolasch & Birch, LLP. He can be contacted at:
etp@bskb.com
Kel E. Rose is a patent agent at Birch, Stewart, Kolasch & Birch, LLP.
Eugene Perez has practised in intellectual property since 2000 and specialises in chemical, pharmaceutical and biotechnology patents. His experience includes prosecuting patent applications, initiating and conducting reissue, ex parte and inter partes reexamination proceedings, conducting legal research and preparing freedom to
operate,
patentability, infringement, and validity opinion letters. Perez also lectures for the Practising Law Institute (PLI).
World Intellectual Property Review September/October 2012
49
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