Two recent decisions from the Patent Trial and Appeal Board (PTAB) highlight the key factor in identifying real parties-in-interest in an inter partes review (IPR): whether a non-party controls or has the ability to control the petitioner’s participation in the IPR proceeding. Mobile Tech, Inc. v. Sennco Solutions, Inc., Case No. IPR2017-02199 (PTAB, Apr. 10, 2018) (McGraw, APJ); Puzhen Life USA, LLC v. Esip Series 2, LLC, Case No. IPR2017-02197 (PTAB, Apr. 11, 2018) (Kaiser, APJ). 

In Mobile Tech, the patent owner, Sennco Solutions, argued that the PTAB should deny Mobile Tech’s petition because it failed to name Mobile Tech’s sole owner as a real party-in-interest. In support of its argument, Sennco alleged that Mobile Tech could not make litigation decisions without input from its owner, that its owner received regular updates about the dispute, and that its owner had the sole right to manage Mobile Tech’s business. 

The PTAB found Sennco’s arguments unpersuasive, finding that the mere existence of a parent-subsidiary relationship, without more, is insufficient to establish that the parent is involved in an IPR proceeding or makes decisions for the petitioner. The PTAB explained that one of the facts considered in determining if a non-party is a real party-in-interest is whether the non-party “exercised or could have exercised control over [Mobile Tech’s] participation in a proceeding” and whether the non-party “is funding or directing the proceeding.” The PTAB found that none of Sennco’s allegations established that Mobile Tech’s owner controlled or funded the proceeding. The PTAB thus concluded that Mobile Tech properly identified all real parties-in-interest, and instituted the IPR.

The PTAB addressed a similar situation in Puzhen Life, in which the patent owner, Esip Series, filed a request for rehearing, urging the PTAB to dismiss the petition because Puzhen Life failed to identify all real parties-in-interest. Esip Series argued that Puzhen Life should have named its corporate parent as a real party-in-interest because it substantively controlled Puzhen entities. The PTAB disagreed, holding that “without more, generic corporate control through ownership is insufficient to establish the control necessary to show that the corporate parent is a real party-in-interest.” 

Esip Series also alleged that Puzhen Life failed to name as a real party-in-interest doTERRA International, the only party against which Esip Series asserted its patent in a district court action. Esip Series argued that doTERRA desired review of the patent because doTERRA was the defendant in the district court action. The PTAB, however, found “no rule establishing that every party who has been sued for infringement of a patent is necessarily a real party-in-interest.” Esip Series also argued that doTERRA’s agreement to the same estoppel that applied to Puzhen Life made doTERRA a real party-in-interest. The PTAB disagreed, finding that doTERRA’s agreement to the terms of the estoppel was not an agreement to be bound as a real party-in-interest. Accordingly, the PTAB denied Esip Series’ request that the IPR be terminated.