The Federal Circle (Judge Lourie, Chief Judge Prost, Judge Linn) in Achates Reference Publishing, Inc. v. Apple Inc. (2014-1767, September 30, 2015), held that it did not have jurisdiction to review a Patent Trial and Appeal Board’s ( the “PTAB”) decision whether Inter Partes Review(IPR) is time-barred.
On June 20, 2011, Achates sued QuickOffice and other parties for infringement of two patents. One year later, Achates joined Apple as a defendant in the lawsuit. On December 14, 2012, more than one year before the original lawsuit but less than one year after Apple was joined, Apple filed petitions for IPR with the PTAB challenging the patents. The PTAB instituted review and ultimately found the asserted claims of the patents unpatentable. The applicable statute, 35 U.S.C. §315(b) recites:
An inter partes review may not be instituted of the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent. The time limitation set forth in the preceding sentence shall not apply to a request for joinder under subsection (c).
In the IPR, Achates argued that Apple’s petition was time-barred because of Apple’s relationship with QuickOffice and the other codefendants was a real party-in-interest or privy relationship, thereby barring Apple from filing its IPR petition more than one year after QuickOffice and other co-defendant had been served with a complaint. The PTAB disagreed, finding no evidence indicating any of the co-defendants had “the right to intervene or control” Apple’s defense to patent infringement and that Apple and codefendant had distinct interests. Page 4 of 14-1767 Opinion.
On appeal, Apple argued that the PTAB’s determination whether the IPR petitions was timely filed is part of institution decision, and is therefore a non-appeable issue even after the final written decision, under §314(d), because the determination was made with the Board’s authority. Achates countered, stating that §319 permitted the appeal because the determination whether a petition is time-barred is part of the Board’s ultimate authority to invalidate the patents.
The America Invents Act (AIA) allows a petitioner to appeal a final decision of the PTAB, while the PTAB’s decision whether to institute is not appealable. The applicable statutes are provided below.
35 U.S.C. §314(d):
The determination by the Director whether to institute an inter partes review shall be final and nonappealable.
35 U.S.C. §318(a):
If an inter partes review is instituted and not dismissed under this chapter, the Patent Trial and Appeal Board shall issue a final written decision with respect to the patentability of any patent claim challenged by the petitioner and any new claim added under section 316 (d).
35 U.S.C. §141:
A party to an inter partes review or a post-grant review who is dissatisfied with the final written decision of the Patent Trial and Appeal Board under section 318 (a) or 328 (a) (as the case may be) may appeal the Board’s decision only to the United States Court of Appeals for the Federal Circuit.
The Federal Circuit addressed the distinction between a final written decision on the merits and an initiation decision, finding that only the merits of the final written decision are appealable. Page 9 of 14-1767 Opinion.
The Federal Circuit distinguished a decision whether IPR is time-barred from its earlier decision to review whether the patent at issue was eligible for CBM review in Versata Dev. Grp., Inc. v. SAP America, Inc., 793 F.3d 1306 (Fed. Cir. 2015). The Federal Circuit noted that, “although the issue of whether a patent is a [covered business method review (“CMBR”)] is first determined by the Director at the initiation stage, the same issue was necessarily implicated in the final merits determination, and is appropriate for review because of the fundamental limitation of the Board’s ultimate invalidation authority” in a CBMR to those patents that meet the CBM definition. Id.
The issue in the present case is distinguishable from Versata because the determination whether an IPR is time-barred does not itself give the PTAB the power to invalidate a patent. For example, if another party filed the IPR, the PTAB may still invalidate the patent. Page 11 of 2014-788 Opinion. Instead, Federal Circuit found that the time-bar sets out only a procedure for seeking IPR. Like other filing deadlines, the IPR time-bar is merely a rule promoting the orderly limitation by requiring that the parties take certain procedural steps at specified times. Page 12 of 14-1767 Opinion. The Court, therefore, held that it cannot review the Board’s determination whether IPR proceedings are time-barred, even if such assessment is part of the Board’s final written decision.