Addressing statutory estoppel issues in connection with inter partes re-examination, the US Court of Appeals for the Federal Circuit ordered the Patent Trial and Appeal Board (PTAB) to dismiss a re-examination against certain of Fairchild’s claims, which the PTAB previously affirmed as being invalid. Fairchild (Taiwan) Corp. v. Power Integrations, Inc., Case No. 17-1002 (Fed. Cir., Apr. 21, 2017) (Reyna, J). 

Power Integrations filed suit against Fairchild in 2008, alleging infringement of four patents covering certain semiconductor chips that operate as power supply controllers, useful for supplying power to electronic devices. Fairchild counterclaimed, alleging infringement of three patents. The district court bifurcated the liability and damages phases of the case prior to trial. After a ten-day trial on liability, the jury returned a mixed verdict finding Power Integration’s asserted claims were not invalid and that Fairchild infringed two of Power Integration’s patents. As for Fairchild’s patents, the jury found that the asserted claims were not invalid and that Power Integrations infringed one of the patents under the doctrine of equivalents. The district court entered its final judgment on liability on January 13, 2015. Fairchild appealed, and Power Integrations cross-appealed various issues; in particular, Power Integrations appealed the jury’s verdict that Fairchild’s asserted patent was not invalid as obvious over certain prior art. On December 12, 2016, the Federal Circuit issued its opinion, affirming the jury’s verdict that the asserted claims of Fairchild’s patent would not have been obvious over the cited prior art, and remanding the case to the district court to resolve other issues.

In June 2012, Power Integrations filed a request for inter partes re-examination of various claims of Fairchild’s patent. During the re-examination, the examiner issued a final rejection of all challenged claims on multiple grounds, including that all the claims asserted in district court litigation were obvious over the same prior art references as those considered by the jury. After the PTAB denied Fairchild’s request for rehearing, Fairchild appealed to the Federal Circuit. After the Federal Circuit decided the appeal of the district court case, Fairchild filed a motion for the Federal Circuit to vacate the PTAB’s re-examination determination with respect to the asserted claims, based on statutory estoppel under 35 USC § 317(b). At the same time, Fairchild asked the Federal Circuit to abandon its appeal of the remaining claims at issue in the re-examination.

The Federal Circuit agreed. As the Court explained, the applicable version of § 317(b) provides that “no inter partes reexamination proceeding can be brought or ‘maintained’ on ‘issues’ that a party ‘raised or could have raised’ in a civil action arising in whole or in part under 28 U.S.C. § 1338 once ‘a final decision has been entered’ in the civil action that ‘the party has not sustained its burden of proving the invalidity’ of the patent claim.” Disagreeing with Power Integrations, the Court noted that the validity of Fairchild’s patent was not at issue in the remand to the district court. The Court accordingly remanded the proceeding to the PTAB, with orders to dismiss the re-examination with respect to Fairchild’s asserted claims and to further enter a re-examination certificate invalidating the remainder of the claims.