Trials@uspto.gov
`571-272-7822
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`Paper 62
`Date: April 24, 2020
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`FOX FACTORY, INC.,
`Petitioner,
`
`v.
`
`SRAM, LLC,
`Patent Owner.
`_________
`
`IPR2017-00118
`Patent 9,182,027 B2
`____________
`
`
`Before MICHAEL W. KIM, FRANCES L. IPPOLITO, and
`KEVIN W. CHERRY, Administrative Patent Judges.
`
`CHERRY, Administrative Patent Judge.
`
`
`ORDER
`Modifying Institution Decision and
`Granting Request for Additional Briefing
`37 C.F.R. § 42.5(a)
`
`
`
`
`
`
`
`571-272-7822
`
`
`
`
`
`
`
`
`Paper 62
`Date: April 24, 2020
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`FOX FACTORY, INC.,
`Petitioner,
`
`v.
`
`SRAM, LLC,
`Patent Owner.
`_________
`
`IPR2017-00118
`Patent 9,182,027 B2
`____________
`
`
`Before MICHAEL W. KIM, FRANCES L. IPPOLITO, and
`KEVIN W. CHERRY, Administrative Patent Judges.
`
`CHERRY, Administrative Patent Judge.
`
`
`ORDER
`Modifying Institution Decision and
`Granting Request for Additional Briefing
`37 C.F.R. § 42.5(a)
`
`
`
`
`
`
`
`
`IPR2017-00118
`Patent 9,182,027 B2
`
`
`
`
`
`I. BACKGROUND
`FOX Factory, Inc. (“Petitioner”) filed a Petition pursuant to 35 U.S.C.
`§§ 311–19 to institute an inter partes review of claims 7–12 and 20–26 of
`U.S. Patent No. 9,182,027 B2 (Ex. 1001, “the ’027 patent”) on eight asserted
`grounds for unpatentability:
`References
`
`Basis
`
`Challenged Claims
`7, 8, 11, 12, 20–22, 25,
`and 26
`9, 10, 23, and 24
`7, 8, 11, 20–22, and 25
`9, 10, 12, 23, 24,
`and 26
`7, 8, 11, 12, 20–22, 25,
`and 26
`9, 10, 23, and 24
`7, 8, 11, 20–22, and 25
`9, 10, 12, 23, 24,
`and 26
`Paper 2 (“Pet.”), 15, 45, 57, 80, 91. Patent Owner, SRAM, LLC, filed a
`Preliminary Response. Paper 5 (“Prelim. Resp.”). Applying the standard set
`forth in 35 U.S.C. § 314(a), which requires demonstration of a reasonable
`likelihood that Petitioner would prevail with respect to at least one
`challenged claim, we instituted an inter partes review of claims 7–12 and
`20–26 of the ’027 patent only on the grounds for unpatentability based on
`obviousness over Thompson and JP-Shimano, and Thompson, JP-Shimano,
`and Hattan. Paper 8 (“Inst. Dec.”), 27. In the Institution Decision, we
`
`§ 103(a)
`Thompson1 and JP-Shimano
`Thompson, JP-Shimano and Hattan § 103(a)
`Dake and Martin
`§ 103(a)
`Dake, Martin, and Hattan
`§ 103(a)
`
`Thompson and Martin
`Thompson, Martin, and Hattan
`Dake and JP-Shimano
`Dake, JP-Shimano, and Hattan
`
`§ 103(a)
`§ 103(a)
`§ 103(a)
`§ 103(a)
`
`
`1 The applied references are described in more detail in a table in the
`Institution Decision. Inst. Dec. 5–6.
`
`2
`
`
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`IPR2017-00118
`Patent 9,182,027 B2
`
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`determined, however, because Martin had previously been considered by the
`Office, that we should exercise our discretion under 35 U.S.C. § 325(d) and
`deny institution of grounds based on Martin. Inst. Dec. 7–10 (citing 35
`U.S.C. § 325(d) (2012)).
`After institution, Patent Owner filed a Patent Owner Response to the
`Petition, addressing only the instituted grounds (Paper 13 (“PO Resp.”)), and
`Petitioner filed a similarly limited Reply (Paper 32 (“Reply”)). Patent
`Owner was also permitted to file a Sur-Reply (Paper 38 (“Sur-Reply”).
`Each party requested an oral hearing (Papers 40 and 42); and we held a
`consolidated oral hearing with IPR2016-01876 and IPR2017-00472 on
`January 12, 2018. See Paper 47 (Trial Hearing Order). A transcript of that
`hearing is of record in this case. Paper 58.
`On April 2, 2018, we issued a Final Written Decision determining that
`Petitioner had failed to demonstrate by a preponderance of the evidence that
`claims 7–12 and 20–26 of the ’027 patent were unpatentable as rendered
`obvious by the combined teachings of Thompson and JP-Shimano, and
`Thompson, JP-Shimano, and Hattan. Paper 59, 64. On April 24, 2018, the
`U.S. Supreme Court held that a decision to institute under 35 U.S.C. § 314
`may not institute on fewer than all of the claims challenged in the Petition.
`SAS Inst., Inc. v. Iancu, 138 S. Ct. 1348, 1354 (2018). Although the panel
`instituted review on all of the challenged claims, the panel had not instituted
`review on all of the asserted grounds. On May 25, 2018, Petitioner filed a
`Notice of Appeal to the U.S. Court of Appeals for the Federal Circuit (the
`“Federal Circuit”), challenging the determination of the Final Written
`Decision. Paper 61.
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`3
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`IPR2017-00118
`Patent 9,182,027 B2
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`On December 19, 2019, the Federal Circuit issued a decision vacating
`the obviousness determination in our Final Written Decision and remanding
`this case to “reevaluate the import of the evidence of secondary
`considerations with the burden of proving nexus placed on the correct
`party.” Fox Factory v. SRAM, LLC, 944 F.3d 1366, 1380 (Fed. Cir. 2019).
`The Federal Circuit also remanded this case for us to “consider the non-
`instituted grounds.” Id. On March 20, 2020, the Federal Circuit issued the
`mandate in this case. See Ex. 3001.
`
`
`II. NON-INSTITUTED GROUNDS
`With respect to the non-instituted grounds, pursuant to 35 U.S.C.
`§ 314(a), the holding in SAS Institute, and the Federal Circuit’s mandate in
`the instant proceeding, we modify the Institution Decision to include review
`on all of the challenged claims and on all of the grounds asserted in the
`Petition.
`
`III. PROCEEDINGS ON REMAND
`A. Conference with the Parties
`In accordance with PTAB Standard Operating Procedure 9, we held a
`conference call with the parties on April 15, 2020, to discuss the status of the
`case and what was necessary to conclude this proceeding in accordance with
`the mandate of the Federal Circuit. Petitioner notified us that it did not
`intend to pursue the non-instituted grounds, and is prepared to accept
`adverse judgment in this proceeding as to the previously non-instituted
`grounds. After a discussion with the parties, Patent Owner agreed that a
`request for partial adverse judgment would be a satisfactory way to resolve
`the previously non-instituted grounds.
`
`4
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`IPR2017-00118
`Patent 9,182,027 B2
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`As for the other issue the Federal Circuit remanded, that we should
`“reevaluate the import of the evidence of secondary considerations with the
`burden of proving nexus placed on the correct party.” Fox Factory, 944
`F.3d at 1380. The parties agreed that no new evidence was necessary. The
`parties also agreed that additional briefing was necessary. The parties did
`not agree, however, on the briefing schedule or length of the proposed briefs.
`Petitioner offered two proposals: (1) one round of simultaneous briefing
`where each party files one brief of 15 pages at the same time; or (2) two
`rounds of simultaneous briefing where each party files an opening brief of
`15 pages and a responsive brief of 10 pages. Patent Owner requested that,
`because it has the burden of proof of showing nexus, it should be allowed to
`file an opening brief of 5000 words, then after the opening brief, Petitioner
`should be allowed to file a response brief of 3750 or 5000 words, and then,
`following the response brief, Patent Owner should be allowed to file a reply
`brief of 3750 words. As for the schedule, the parties agreed that under either
`proposal the first round of briefing should be due 30 days from any order
`setting the schedule, and the second round 30 days following the first round.
`The panel reserved decision on the briefing schedule. Petitioner asked
`that we also include in any order setting the briefing schedule exactly what
`we wanted included in its request for partial adverse judgment. Petitioner
`informed us that it would be able to file its request for partial adverse
`judgment within 1 week of our order.
`B. Petitioner’s Request for Partial Adverse Judgment
`With respect to Petitioner’s Request for Partial Adverse Judgment, we
`have considered Petitioner’s arguments. Petitioner’s request should, at a
`minimum, (1) clearly identify the grounds it wishes to abandon,
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`5
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`IPR2017-00118
`Patent 9,182,027 B2
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`(2) unequivocally state that it is requesting partial adverse judgment under
`37 C.F.R. § 42.73(b), and (3) identify the grounds that still remain in the
`proceeding. See, e.g., 1964 Ears, LLC v. Jerry Harvey Audio Holding, LLC,
`IPR2017-01092, Paper 48 at 3–5 (PTAB June 13, 2018) (Petitioner’s
`Request for Partial Adverse Judgment). Petitioner’s request shall be filed
`within 1 week of this order.
`C. Briefing on Remaining Issues
`As for the briefing on remand, we have considered the parties’
`arguments, the respective burdens of proof, the issue that the Federal Circuit
`has ordered us to consider on remand, and the size and scope of the record in
`this proceeding. Based on our review, we order additional briefing limited
`to the issue of “the import of the evidence of secondary considerations with
`the burden of proving nexus placed on the correct party” as follows: (1)
`Patent Owner may file a 15-page opening brief within 30 days of this order;
`(2) Petitioner may file a 15-page response brief no later than 30 days after
`Patent Owner files its opening brief; (3) Patent Owner may file a 10-page
`reply brief within 14 days from the filing of Petitioner’s response brief; and
`(4) Petitioner may file a 10-page sur-reply brief within 14 days of the filing
`of Patent Owner’s reply. No new evidence may be submitted.
`
`
`IV. ORDER
`
`Accordingly, it is:
`ORDERED that we modify the Institution Decision to include review
`of all of challenged claims and all of the grounds asserted in the Petition;
`FURTHER ORDERED that Petitioner is authorized to file a Request
`for Partial Adverse Judgment;
`
`6
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`IPR2017-00118
`Patent 9,182,027 B2
`
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`FURTHER ORDERED that Petitioner shall file its Request for Partial
`Adverse Judgment within 1 week of this order;
`FURTHER ORDERED that the following additional briefing, limited
`to the issue of “the import of the evidence of secondary considerations with
`the burden of proving nexus placed on the correct party” is allowed:
`(1) Patent Owner’s Opening Brief limited to 15 pages, due no later than
`30 days from the date of this Order;
`(2) Petitioner’s Response Brief limited to 15 pages, due no later than
`30 days from the filing date of Patent Owner’s Opening Brief;
`(3) Patent Owner’s Reply Brief limited to 10 pages, due no later than
`14 days from the filing date of Petitioner’s Response Brief; and
`(4) Petitioner’s Sur-Reply Brief limited to 10 pages, due no later than
`14 days from the filing date of Patent Owner’s Reply Brief; and
`FURTHER ORDERED that no new evidence may be submitted with
`the briefing.
`
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`7
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`For Petitioner:
`
`Joshua Goldberg
`Arpita Bhattacharyya
`Daniel Klodowski
`FINNEGAN, HENDERSON, FARABOW, GARRETT & DUNNER, LLP
`joshua.goldberg@finnegan.com
`arpita.bhattacharyya@finnegan.com
`daniel.klodowski@finnegan.com
`
`
`For Patent Owner:
`Michael Hickey
`Kirk Damman
`Benjamin Siders
`LEWIS RICE LLC
`mhickey@lewisrice.com
`kdamman@lewisrice.com
`bsiders@lewisrice.com
`
`
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`IPR2017-00118
`Patent 9,182,027 B2
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`8
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