The Applicability of Estoppel Under the AIA to Grounds of Unpatentability Not Instituted for Trial - Buchanan PTAB Report

The America Invents Act (AIA) sets forth estoppel provisions which, under certain circumstances, preclude subsequent judicial and administrative review of claims challenged in inter partes review (IPR) and post-grant review (PGR) proceedings. See 35 U.S.C. §§ 315(e), 325(e). The statute specifies that a petitioner in a review "of a claim in a patent…that results in a final written decision" may not seek subsequent review "with respect to that claim on any ground that the petitioner raised or reasonably could have raised during" the proceeding. Id. The scope of such estoppel provisions has been the subject of recent decisions by the Federal Circuit.

In AIA proceedings, petitioners may challenge multiple patent claims and present multiple grounds of unpatentability. For example, a petition may include multiple grounds of unpatentability relying on different combinations of prior art and statutory bases (such as anticipation under 35 U.S.C. § 102 or obviousness under 35 U.S.C. § 103). The Patent Trial and Appeal Board (PTAB), however, is not required to institute a trial addressing all of the grounds presented, and claims challenged, in the petition. 37 C.F.R. § 42.108(a). In cases where the PTAB has authorized institution with respect to only some of the grounds or claims, the final written decision rendered by the PTAB typically does not address the non-instituted grounds or claims. This raises the question of whether estoppel under §§ 315(e) and 325(e) applies to such non-instituted grounds or claims.

In HP Inc. v. MPHJ Technology Investments, LLC, 817 F. 3d 1339, 1347 (Fed. Cir. 2016), the IPR petitioner argued that a non-instituted ground of unpatentability should have been considered during the AIA proceeding because the petitioner would be estopped from raising such non-instituted ground in a subsequent proceeding or action. The Federal Circuit disagreed. The court explained that "noninstituted grounds do not become a part of the IPR. Accordingly, the noninstituted grounds were not raised and, as review was denied, could not be raised in the IPR. Therefore, the estoppel provisions of § 315(e)(1) do not apply." Id. at 1347. Such holding is consistent with Shaw Indus. Grp., Inc. v. Automated Creel Sys., Inc., 817 F.3d 1293, 1300 (Fed. Cir. 2016), where the court stated that the IPR petitioner is not estopped from subsequently bringing a non-instituted ground "in either the PTO or the district courts" because the petitioner "did not raise – nor could it have reasonably raised [the non-instituted ground] during the IPR. [Emphasis in original.]"

The Federal Circuit came to a similar conclusion concerning the applicability of estoppel to claims challenged in a petition but not subjected to institution. In Synopsys, Inc. v. Mentor Graphics Corp., 814 F.3d 1309 (Fed. Cir. 2016), the PTAB instituted review of some but not all of the claims challenged in an IPR petition and issued a final written decision only addressing the claims for which review was instituted. On appeal, the IPR petitioner argued that "the Board’s practice of issuing final decisions only addressing some of the claims in the petition is inconsistent with the estoppel provisions of the AIA because final decisions that do not address all of the claims ‘will have limited estoppel effect.’" Id. at 1316. The court disagreed, noting that "[i]nter partes review cannot replace the district court in all instances." Id. The court concluded that "[t]he validity of claims for which the Board did not institute inter partes review can still be litigated in district court." Id. Such holding is consistent with PTAB decisions. Westlake Services, LLC v. Credit Acceptance Corp., CBM2014-00176, Paper 28 at 5 (PTAB May 14, 2015) (precedential) ("We agree with Petitioner that estoppel is applied on a claim-by-claim basis."); see also Apotex v. Wyeth LLC, IPR2015-00873, Paper 8 at 8-9 ("grounds raised during the preliminary proceeding [in the petition], but not made part of the instituted trial, are not raised ‘during’ an inter partes review and cannot be the basis for estoppel under 35 U.S.C. § 315(e)(1).").

The scope of estoppel may factor into developing strategies for drafting petitions under the AIA. For example, the scope of estoppel may bear on the number of grounds of unpatentability presented and claims challenged in a petition. Post-grant practice under the AIA is rapidly evolving, and the issue of estoppel will likely receive further administrative and judicial attention. Nevertheless, the decisions discussed above provide practitioners with valuable guidance for understanding the scope of estoppel under the AIA.