Qualcomm Inc. v. Bandspeed, Inc.
In a case where the patent owner settled out of an IPR proceeding with the petitioners but not with a party seeking joinder, the Patent Trial and Appeal Board (PTAB or Board) instituted inter partes review of all the challenged claims based on the joining party’s petition and granted its joinder motion. Qualcomm Inc. v. Bandspeed, Inc., IPR2015-00314;-01577 (PTAB, Nov. 16, 2015) (Boucher, APJ).
Marvell Semiconductor and MediaTek filed a petition to institute inter partes review of certain claims of a patent owned by Bandspeed. Bandspeed did not file a preliminary response. Soon after Marvell and the patent owner settled the underlying dispute and filed a joint motion to terminate that was granted. The next day, the PTAB instituted an inter partes review based on the MediaTek petition. Soon afterwards Qualcomm filed a petition along with a motion seeking to join both the MediaTek and Marvell IPR petitions.
While Qualcomm’s motion was pending, MediaTek settled with the patent owner and the parties jointly filed a motion to terminate that was granted by the Board, but only as to MediaTek, not the patent owner. The PTAB stated that it would revisit the Motion to Terminate as to the patent owner after ruling on the pending joinder motion. The patent owner filed a paper it called a preliminary response to Qualcomm’s petition, but according to PTAB “the Preliminary Response [did] not respond to any of the arguments and evidence presented in the Qualcomm Petition, aside from indicating that absent joinder, Qualcomm would be barred from filing a petition under 35 U.S.C. § 315(b).” In the Board’s view, “Patent Owner used the Preliminary Response as an unauthorized sur-reply to the Motion for Joinder.” Since the patent owner did not seek, nor did the PTAB grant authorization for the additional briefing on the joinder motion, the PTAB did not consider arguments presented by the patent owner in its preliminary response to the Qualcomm petitions.
Soon after, the Board granted Qualcomm’s Motion for Joinder, noting that Qualcomm’s petition was “in all material respects the same as the petition in” the Marvell/MediaTek IPR petitions. Further, the expert declaration relied on by Qualcomm appeared to be an exact copy of the expert declaration as part of the Marvell/MediaTek petition. Accordingly, the PTAB instituted an inter partes review on the same grounds.
The filing date of Qualcomm’s petition satisfied the one month joinder requirement of 37 CFR 42.122(b). In permitting Qualcomm’s joinder, the PTAB explained:
If the Director institutes an inter partes review, the Director, in his or her discretion, may join as a party to that inter partes review any person who properly files a petition under § 311 that the Director, after receiving a preliminary response under § 313 or the expiration of the time for filing such a response, determines warrants the institution of an inter partes review under § 314.
The patent owner opposed Qualcomm’s Motion for Joinder, arguing that it would discourage early settlement. Specifically, the patent owner argued as follows:
A contrary decision would mean far fewer settlements will occur in multi-defendant cases until at least one month after institution of an IPR (possibly several months after institution if the original petitioner and patent owner must wait to see if another defendant is permitted to join after that defendant files a motion to join) because the patent owner will always be concerned that even if it settles with the original petitioner, another defendant will seek to join or be permitted to join the instituted IPR that would otherwise likely be terminated, depriving the patent owner of much of the value of its settlement with the original petitioner.
The PTAB was unpersuaded. It characterized the patent owner’s argument as “speculative attorney argument unsupported by evidence,” noting that MediaTek did not oppose the joinder and yet the patent owner was able to reach settlement with MediaTek. The PTAB stated that it was “unpersuaded that joinder in this case will, as a policy matter, discourage settlement.”