Nautique Boat Co., Inc. v. Malibu Boats, LLC
Addressing whether a district court action dismissed without prejudice bars a filing of an inter partes review (IPR) petition under 35 U.S.C. § 315(a)(1), the U.S. Patent and Trademark Office’s (PTO) Patent Trial and Appeal Board (PTAB or Board) determined that a district court action dismissed without prejudice does not bar an IPR petition, explaining that the “voluntary” or “involuntary” nature of the district court’s dismissal is irrelevant. Nautique Boat Co., Inc. v. Malibu Boats, LLC, Case IPR2014-01045 (PTAB, Nov. 26, 2014) (Kalan, APJ).
Malibu Boats owned the challenged patent, which generally directed to an adjustable wake system for a boat. The petitioner, Nautique Boat, filed an IPR petition alleging that some of the claims of the patent were anticipated or obvious based on several prior art references. At the time of the filing, the patent was involved in district court litigation.
In its response, patent owner argued that Nautique was barred from filing the IPR under 35 U.S.C. § 315(a)(1), which provides that “an inter partes review may not be instituted if, before the date on which the petition for such a review is filed, the petitioner or real party in interest filed a civil action challenging the validity of a claim of the patent.” Specifically, Nautique had previously filed a declaratory judgment action against the patent in district court, but the declaratory judgment action was later dismissed without prejudice. The patent owner argued that this dismissal was not “voluntary” on Nautique’s part because Nautique was “enjoined” from maintaining the declaratory judgment action.
The Board noted that there was no evidence on the record indicating that the dismissal of the declaratory judgment action was anything other than without prejudice. Nautique was not barred from refiling a similar action. Thus, the Board should treat the declaratory judgment action as though it never existed. The Board characterized the patent owner’s position as being that the “involuntary” circumstances of the dismissal of the declaratory judgment action should prohibit Nautique from filing the IPR. However, the Board found that the voluntary or involuntary nature of the dismissal is irrelevant. In order to prevail on its § 315(a)(1) argument, the patent owner would have needed to show that the dismissal of the declaratory judgment action barred Malibu from refiling its lawsuit. In sum, the Board found that dismissal of the declaratory judgment lawsuit without prejudice does not bar the IPR under 35 U.S.C. § 315(a).