If a Petitioner does not timely file the required petition fee, an IPR will not be instituted. In Cultec, Inc. v. Stormtech LLC [Case No. IPR2017-00526, Paper 14 (July 17, 2017)], consistent with earlier decisions, the Board denied institution of an IPR because the Petitioner, Cultec, Inc., did not pay the required filing fee until the day after filing its petition, which was one day after the statutory filing deadline under 35 U.S.C. § 315(b).

Petitioner was served with a complaint alleging infringement of Stormtech’s patent on January 5, 2016. Petitioner filed and served a petition for IPR on January 5, 2017, the last day permitted for filing a petition under § 315(b). Petitioner successfully uploaded the Petition and related exhibits that afternoon, using the PTAB E2E filing system. Later that day, Petitioner alleges that it made five attempts to pay the required fee of $25,600 (including the filing fee and excess claim fees).

The Petitioner’s January 5 payment attempts were unsuccessful because the Petitioner’s counsel: (1) attempted a credit card payment (at 7:10 p.m.) that was greater than the maximum amount permitted by credit card ($24,999); (2) ignored a warning message indicating that such payment would be rejected; (3) waited until 11 p.m. to check on the status of the payment; and (4) subsequently attempted payment from a deposit account with insufficient funds and from a debit card whose authorization was denied. As a result, the required fee was not paid until the next day, after Petitioner’s counsel replenished its deposit account. The PTAB therefore accorded the petition a filing date of January 6, 2017, one day after the one-year bar.

Because the PTAB has discretion to change the filing date of petitions, Petitioner filed a motion to have the accorded filing date changed to January 5, 2017. Declarations of a paralegal and an attorney regarding the attempted payments supported the motion. Stormtech opposed the motion, and the Board denied the motion. The Board determined that the statute requires that an IPR petition “may be considered only if the petition is accompanied by payment,” 35 U.S.C. § 312(a)(1) (emphasis added), and that the rules require that the payment must be received, not merely tendered, in order to be considered as “accompanying” the petition, 37 C.F.R. § 42.103(b).

Petitioner argued that its “failure to appreciate that the Deposit Account payment would be the only viable payment method to pay the IPR filing fee was a ‘clerical error’ of the same type excused” in other Board cases. The Board disagreed, noting that fees may also be made by debit card payment or by electronic funds transfer from a bank or other financial institution.

The Board found that Petitioner demonstrated: (1) a lack of understanding as to how proper payments are made; (2) a lack of understanding of its own accounts, particularly the funds available for payment; (3) an unreasonable lack of diligence in checking the status of the initial payment; and (4) a lack of any evidence indicating that the PTO’s payment system had any technical difficulties on January 5th. The Board concluded that Petitioner’s failure to make the required payment on January 5th was not due to technical difficulties with the system and that Petitioner had not met its burden of establishing that it was entitled to have the filing date changed.

This case is another reminder that the Board will strictly apply the statutory requirement to deny institution of an IPR until all fees are paid. Petitioners may avoid this problem by (1) filing a petition well in advance of the statutory deadline, and (2) making sure that sufficient funds are present in the practitioner’s deposit account or by using one of the other permitted forms of payment.