Garmin Int’l Inc. v. Cuozzo Speed Techs. LLC, IPR2012-00001 (PTAB Mar. 5, 2013)

Inter Partes Review (IPR) is a creation of the America Invents Act. Like the newly created Post Grant Review (PRG), an IPR is initiated by a third party challenging the validity of one or more claims in an issued patent, and is conducted as a trial proceeding before the Patent Trial and Appeal Board. Because both proceedings have a statutory deadline for completion of one year from the date the proceeding is instituted (this period may be extended up to six months for good cause) and because of the desire to limit the cost burden on the parties, the discovery allowed is substantially more circumscribed than in district court patent disputes.

As a general guideline, discovery in a PGR proceeding is limited to evidence directly related to factual assertions advanced by either party. In an IPR, discovery is limited to the deposition of witnesses submitting affidavits or declarations and to “what is otherwise necessary in the interest of justice,” a standard potentially broader than in a PGR proceeding, but still significantly less than that available under the Federal Rules of Civil Procedure.

In its recent Garmin v. Cuozzo decision, the PTAB had occasion to consider the meaning of “routine” and “additional” discovery in an IPR proceeding, and the type of additional discovery that would meet the “interest of justice” standard. Patent owner Cuozzo attempted to characterize all of its document requests and interrogatories as “Routine Discovery” under 37 C.F.R. §§ 41.51(b)(1)(i) and 41.51(b)(1)(iii), a gambit that rested on the fact that Board authorization is not required to conduct routine discovery (Office Patent Trial Practice Guide, 77 Fed. Reg. 48756, 48761 (Aug. 14, 2012).

The Board, however, found that Cuozzo’s requests went well beyond “routine” discovery. Cuozzo, for example, demanded that Garmin produce file histories of all patents relied on in its petition challenging the validity of the Cuozzo patent, a request made under 37 C.F.R. §§ 41.51(b)(1)(i) which requires that “any exhibit cited in a paper or in testimony must be served along with the citing paper or testimony.” Here the Board noted that this request was unreasonably broad since (i) Garmin did not rely on the requested file histories in his petition, and (ii) Cuozzo could independently obtain those file histories in any case.

Cuozzo justified its request for a variety of other information under 37 C.F.R. §§ 41.51(b)(1)(iii), which is directed to specific information known to the responding party to be inconsistent with positions advanced by that party in the proceeding, and not broadly directed to any subject area in general within which the requesting party hopes to discover such inconsistent information. Here the Board concluded, for the reasons considered below, that Cuozzo was not seeking information known to be inconsistent with Garmin’s position taken in the petition, but rather was casting a wide net hoping to find information that might be inconsistent with Garmin’s positions.

Specifically, the Board considered whether Cuozzo’s discovery request could be classed as “additional” discovery under the “necessary in the interest of justice” standard. The Board listed five factors that it considers in authorizing a motion for additional discovery, focusing its attention on Factor (1): “More than a possibility and mere allegation -- The mere possibility of finding something useful and the mere allegation that something useful will be found are insufficient to meet the ‘interest of justice’ standard. The party requesting discovery should already be in possession of evidence tending to show beyond speculation that in fact something useful will be uncovered.” Elaborating on this factor, the Board noted that “useful” in this context does not mean merely relevant and/or admissible, but rather “favorable in substantive value to a contention of the party moving for the discovery.”

The vast majority of Cuozzo’s requested items were related to its assertions of secondary considerations of non-obviousness, such as long-felt need, failure of others, commercial success, and copying. In rejecting these requests, the Board found that Cuozzo’s motion lacked a threshold amount of evidence or reasoning tending to show that Garmin copied Cuozzo’s invention, that Garmin attempted but failed to produce a device having the features of Cuozzo’s claimed invention, that Garmin achieved commercial success “because of” any feature recited in the Cuozzo claims under review, or that there was a long-felt need for a feature implemented by Cuozzo’s claimed invention. As an example, Cuozzo failed to make a sufficient showing of a nexus between the claimed invention and Cuozzo’s discovery requests. There was no showing that the requested sales and pricing information were for units and sales that are due to an inventive feature claimed by Cuozzo, or that Garmin was able to demand a premium price specifically on account of any claimed feature.

The Cuozzo case provides a useful guide to allowable discovery in an IPR procedure.