Paper No. 23
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`Filed on behalf of Patent Owner by:
`Patrick J. McElhinny, Reg. No. 46,320
`Mark G. Knedeisen, Reg. No. 42,747
`K&L GATES LLP
`210 Sixth Ave.
`Pittsburgh, PA 15222
`Tel: 412-355-6500 / Fax: 412-355-6501
`
`Richard F. Giunta, Reg. No. 36,149
`Gerald B. Hrycyszyn, Reg. No. 50,474
`WOLF, GREENFIELD & SACKS, P.C.
`600 Atlantic Ave.
`Boston, MA 02210-2206
`Tel: 617-646-8000 / Fax: 617-646-8646
`
`
`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_____________
`
`LSI CORPORATION and AVAGO TECHNOLOGIES U.S., INC,
`Petitioners,
`
`v.
`
`REGENTS OF THE UNIVERSITY OF MINNESOTA,
`Patent Owner.
`_____________
`
`Case No. IPR2017-01068
`Patent No. 5,859,601
`_____________
`
` PATENT OWNER’S MOTION TO STAY
`
`
`
`

`

`TABLE OF CONTENTS
`
`INTRODUCTION ........................................................................................... 1
`ARGUMENT ................................................................................................... 1
`A.
`Sovereign Immunity Protects UMN From Being Forced To
`Participate In This Proceeding. ............................................................. 1
`UMN Is Entitled To Immediate Judicial Review. ................................. 2
`Courts Protect Sovereign Immunity Pending an Appeal. ..................... 5
`The Board Has The Authority To Stay The Proceeding ....................... 6
`UMN’s Appeal Will Automatically Divest The Board Of
`Jurisdiction Over This IPR Proceeding. ................................................ 7
`Staying The Proceeding Before Divestiture Is Preferred .................... 10
`
`B.
`C.
`D.
`E.
`
`F.
`
`I.
`II.
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`
`
`-i-
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`

`

`TABLE OF AUTHORITIES
`
`CASES
`
`Aisin Seiki Co., Ltd. v. Am. Vehicular Scis. LLC,
`IPR2013-00383, Paper 7 (PTAB Sept. 12, 2013) .................................................. 7
`Apostol v. Gallion,
`870 F.2d 1335 (7th Cir. 1989) ...................................................................... 5, 6, 8
`Baum Research & Dev. Co. v. Univ. of Mass. at Lowell,
`503 F.3d 1367 (Fed. Cir. 2007) (“Baum Research”) ............................................. 3
`Califano v. Sanders,
`430 U.S. 99 (1977) ............................................................................................... 10
`Captioncall, LLC. v. Ultratec, Inc.,
`IPR2013-00540, 2016 WL 8944624 (PTAB Aug. 9, 2016) .................................. 8
`Chehazeh v. Attorney Gen. of U.S.,
`666 F.3d 118 (3d Cir. 2012) ................................................................................... 3
`Chuman v. Wright,
`960 F.2d 104 (9th Cir. 1992).................................................................................. 9
`Costco Wholesale Corp. v. Robert Bosch LLC,
`IPR2016-00034, 2017 WL 4102099 (PTAB Sept. 14, 2017) (“Costco”) ............. 8
`Cuozzo Speed Techs., LLC v. Lee,
`136 S. Ct. 2131 (2016) (“Cuozzo”) ....................................................................3, 4
`Elec. Frontier Found. V. Personal Audio, LLC,
`IPR2014-00070, Paper 19 (PTAB Jan. 14, 2014) .................................................. 7
`Ericsson Inc. v. Regents of the U. of Minn.,
`IPR2017-01186, Paper 13 (PTAB Aug. 15, 2017) ................................................ 7
`Goshtasby v. Bd. of Trs. of Univ. of Ill.,
`123 F.3d 427 (7th Cir. 1997).................................................................................. 6
`Griggs v. Provident Consumer Discount Co.,
`459 U.S. 56 (1982) ................................................................................................. 7
`Howard v. U.S. Dist. Court for S. Dist. of Ohio,
`No. 09-5139, 2009 WL 2981979 (D.C. Cir. July 10, 2009) .................................. 9
`In re Allen,
`115 F.2d 936 (C.C.P.A. 1940) ............................................................................... 8
`
`-ii-
`
`

`

`In re Bd. of Regents of Univ. of Tex. Sys.,
`435 F. App’x 945 (Fed. Cir. 2011) (“U. of Texas.”) ..........................................2, 5
`Johnson v. Robison,
`415 U.S. 361 (1974) ...........................................................................................4, 8
`Loshbough v. Allen,
`359 F.2d 910 (C.C.P.A. 1966) ............................................................................... 8
`May v. Sheahan,
`226 F.3d 876 (7th Cir. 2000).................................................................................. 8
`Meredith v. Fed. Mine Safety & Health Review Comm’n,
`177 F.3d 1042 (D.C. Cir. 1999) ............................................................................. 3
`Minotti v. Lensink,
`798 F.2d 608 (2d Cir. 1986) ................................................................................... 3
`Mitchell v. Forsyth,
`472 U.S. 511 (1985) ...........................................................................................4, 5
`Puerto Rico Aqueduct & Sewer Auth. v. Metcalf & Eddy, Inc.,
`506 U.S. 139 (1993) (“PR Aqueduct”) ...............................................................1, 2
`R.I. Dep’t of Envtl. Mgmt. v. United States,
`304 F.3d 31 (1st Cir. 2002) (“RIDEM”) ............................................................1, 2
`Root v. Liberty Emergency Physicians, Inc.,
`68 F. Supp. 2d 1086 (W.D. Mo. 1999) .................................................................. 6
`Shy v. Navistar Int’l Corp.,
`No. 3:92-CV-333, 2014 WL 1818907 (S.D. Ohio May 7, 2014) .......................... 9
`Siegert v. Gilley,
`500 U.S. 226 (1991) ............................................................................................... 5
`Smart Microwave Sensor Gmbh v. Wavetronix LLC,
`IPR2016-00488, 2017 WL 3669083 (PTAB Aug. 24, 2017)
`(“Smart Microwave”) ...................................................................................... 8, 10
`Sofamor Danek Grp., Inc. v. Brown,
`124 F.3d 1179 (9th Cir. 1997) (“Sofamor”) ........................................................... 2
`Stewart v. Donges,
`915 F.2d 572 (10th Cir. 1990) ............................................................................... 8
`
`-iii-
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`

`

`Univ. of Utah v. Max-Planck-Gesellschaft Zur Forderung Der
`Wissenschaften E.V.,
`734 F.3d 1315 (Fed. Cir. 2013) (“U. of Utah”) .................................................4, 5
`Versata Dev. Grp., Inc. v. SAP Am., Inc.,
`793 F.3d 1306 (Fed. Cir. 2015),
`cert. denied, 136 S. Ct. 2510 (2016) (“Versata”) .................................................. 4
`Wi-Fi One, LLC v. Broadcom Corp.,
`No. 2015-1944, 2018 WL 313065 (Fed. Cir. Jan. 8, 2018) (en banc)
`(“Wi-Fi One”) ......................................................................................................... 3
`Will v. Hallock,
`546 U.S. 345 (2006) ............................................................................................... 2
`Williams v. Brooks,
`996 F.2d 728 (5th Cir. 1993)..............................................................................8, 9
`
`STATUTES
`
`28 U.S.C. § 1291 ........................................................................................................ 4
`28 U.S.C. § 1295(a)(4)(A) .....................................................................................3, 5
`35 U.S.C. § 313 .......................................................................................................... 7
`
`OTHER AUTHORITIES
`
`11A Wright & Miller, Federal Practice & Procedure § 3914.10 ............................... 6
`Brief for Petitioner, S.C. State Ports Auth. v. Fed. Mar. Comm’n,
`No. 00-1481, 2000 WL 34241038 (4th Cir. July 20, 2000) (“FMC Brief”) ......... 3
`
`REGULATIONS
`
`37 C.F.R § 42.5(a) ...................................................................................................... 6
`
`-iv-
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`

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`
`
`I.
`
`INTRODUCTION
`UMN requests the Board maintain the status quo and continue to suspend
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`this proceeding pending appeal of the Board’s Order denying UMN’s motion to
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`dismiss. As the Board recognized, the issues in this case “are of an exceptional
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`nature” and “access to the courts is essential” to their ultimate resolution. Order at
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`3; Concurrence at 2 n.1. UMN will file a notice of appeal immediately upon the
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`Board’s decision on this Motion, but not later than the February 20, 2018 deadline.
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`A continued stay to maintain the status quo pending judicial review is necessary
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`because sovereign immunity is a threshold issue and UMN’s rights would be
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`irrevocably lost if this IPR proceeds on the merits pending judicial review.
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`II. ARGUMENT
`A.
`Sovereign Immunity Protects UMN From Being Forced To
`Participate In This Proceeding.
`
`UMN is an arm of the state of Minnesota entitled to sovereign immunity.
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`Order at 3-4. UMN is immune not only from a decision on the merits in this
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`proceeding, but from being subjected to the process of having to defend itself on
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`the merits. RIDEM, 304 F.3d at 43 (“[T]he state’s sovereign rights encompass
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`more than a mere defense from liability—they include an immunity from being
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`haled before a tribunal by private parties….”); see also PR Aqueduct, 506 U.S. at
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`146 (“The very object and purpose of the 11th Amendment were to prevent the
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`indignity of subjecting a State to the coercive process of judicial tribunals at the
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`1
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`

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`instance of private parties.”).1
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`B. UMN Is Entitled To Immediate Judicial Review.
`UMN’s immunity from the process of this proceeding will be irrevocably
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`lost if this IPR proceeds and the courts ultimately disagree with the Board’s ruling
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`that UMN waived its immunity. PR Aqueduct at 145 (“[T]he value to the States of
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`their [constitutional] immunity … is for the most part lost as litigation proceeds
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`past motion practice.”). Thus, under the collateral order doctrine, courts, including
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`the Supreme Court and Federal Circuit, authorize immediate appellate review of a
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`denial of a motion to dismiss on sovereign immunity grounds. Id. at 147 (“We hold
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`that States, and state entities that claim to be ‘arms of the State,’ may take
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`advantage of the collateral order doctrine to appeal a district court order denying a
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`claim of Eleventh Amendment immunity.”); see also Will, 546 U.S. at 350 (“A
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`State has the benefit of the [collateral order] doctrine to appeal a decision denying
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`its claim to Eleventh Amendment immunity….”); U. of Texas, 435 F. App’x at
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`947-48 (Federal Circuit finding “the [state university] Board can of course
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`immediately appeal and seek review”); RIDEM, 304 F.3d at 43 (affirming order
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`enjoining agency from proceeding); Sofamor, 124 F.3d at 1183 n.2 (permitting
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`immediate appeal because “the central benefit of immunity, the right not to stand
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`
`1 Emphasis added and internal citations omitted, unless otherwise noted.
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`2
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`

`

`
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`trial in the first instance, is effectively lost if a case is erroneously permitted to
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`proceed to trial”); Minotti , 798 F.2d at 608 (“[T]he essence of the immunity is the
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`possessor’s right not to be haled into court—a right that cannot be vindicated after
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`trial.”); Baum Research, 503 F.3d at 1369-70.
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`The fact that the Board, as opposed to a district court, made the decision at
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`issue does not change the result. The collateral order doctrine applies to appeals
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`from agency decisions. See, e.g., Meredith, 177 F.3d at 1051 (“It is well-settled
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`that … the collateral order doctrine appl[ies] … to appeals from executive agency
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`action.”); Chehazeh, 666 F.3d at 136 (Third Circuit noted that the nine courts of
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`appeals that had considered the issue all concluded that the collateral order
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`doctrine applies to judicial review of agency decisions and joined in that same
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`holding). Indeed, the collateral order doctrine was basis of the appeal in FMC, the
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`Supreme Court decision establishing that sovereign immunity applies to agency
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`adjudications. FMC Brief, 2000 WL 34241038, at *1.
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`The Federal Circuit has jurisdiction to hear UMN’s immediate appeal under
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`§1295(a)(4)(A) and the collateral order doctrine. There is a strong presumption of
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`judicial review of agency actions. Cuozzo, 136 S. Ct. at 2140. To overcome that
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`presumption “Congress must clearly and convincingly indicate its intent to prohibit
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`judicial review.” Wi-Fi One, 2018 WL 313065, at *1, 14-15. Congress did no such
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`thing – no statutory provision prohibits judicial review of the Board’s Order
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`3
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`

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`denying UMN’s motion to dismiss. Indeed, no statutory provision could. Even
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`statutes that purport to expressly preclude judicial review do not bar review of
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`constitutional issues. See Cuozzo, 136 S. Ct. at 2136 (Section 314(d) “may not bar
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`consideration of a constitutional question”); Johnson, 415 U.S. at 367 (holding that
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`a statute precluding review of “any question of law or fact under any law
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`administered by the Veterans’ Administration” did not bar review of constitutional
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`challenges). In light of the “strong presumption in favor of judicial review” that
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`must be applied when interpreting statutes, no AIA provision can be interpreted to
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`preclude review of UMN’s appeal. Cuozzo, 136 S. Ct. at 2140. Precluding review
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`would “run counter to our long tradition of judicial review of government actions
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`that alter the legal rights of an affected person.” Versata, 793 F.3d at 1319.
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`That the Board’s decision is not a Final Written Decision post-trial does not
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`change the result. The Supreme Court has held that the collateral order doctrine
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`provides appellate jurisdiction to hear an immediate appeal of a decision denying
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`an immunity defense under 28 U.S.C. § 1291, which limits jurisdiction to appeals
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`from a “final decision,” because the denial is a final decision on the immunity
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`issue given that immunity rights would be lost if not reviewed before trial
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`proceeds. Mitchell, 472 U.S. at 524-25. Similarly, in U. of Utah, the Federal
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`Circuit found that it had appellate jurisdiction to consider an immediate appeal of
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`the denial of the state’s motion to dismiss on sovereign immunity grounds pursuant
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`4
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`

`

`
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`to the collateral order doctrine and 28 U.S.C. §1295(a)(1), a statutory provision
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`that explicitly limits jurisdiction to “a final decision of a district court.” U. of Utah,
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`734 F.3d at 1319. Thus, even if “a decision” in §1295(a)(4)(A) is construed to
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`implicitly require a Board “final decision,” that requirement is no different from
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`the statutory provisions the Supreme Court and Federal Circuit found to authorize
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`immediate appellate review of a denial of a sovereign immunity defense under the
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`collateral order doctrine in U. of Utah and Mitchell.
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`C. Courts Protect Sovereign Immunity Pending an Appeal.
`UMN’s appeal can protect its constitutional rights from improper denial of
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`its motion to dismiss only if the status quo is preserved while the courts exercise
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`their essential oversight function in determining whether the Board properly
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`decided this constitutional issue, which the Board itself characterizes as
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`exceptional and one of first impression for it. U. of Texas, 435 F. App’x at 947-49
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`(immediate appeal will “eliminate[e] any harm asserted by the [University] Board
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`that it might face an unnecessary trial”); Order at 3 (the sovereign immunity issues
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`raised “are of an exceptional nature”); Concurrence at 2 n.1 (the “important
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`constitutional issues” raised here make judicial review “essential”).
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`“Until [the] threshold immunity question is resolved,” the case “should not
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`be allowed” to proceed. Siegert, 500 U.S. at 231; see also Apostol, 870 F.2d at
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`1338 (“The justification for the interlocutory appeal is that the trial destroys rights
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`5
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`

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`created by the immunity. It makes no sense for trial to go forward while the court
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`of appeals cogitates on whether there should be one.”); Goshtasby, 123 F.3d at
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`428-29 (applying Apostol in the context of sovereign immunity). Courts regularly
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`stay cases pending appeal of decisions denying immunity. See e.g., Root, 68 F.
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`Supp. 2d at 1089 (staying the case pending an immunity appeal under the collateral
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`order doctrine – “Many district courts, faced with a similar appeal and motion to
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`stay after having denied immunity, determine that a stay of all proceedings is
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`required pending the outcome of appeal.”); see also e.g., 11A Wright & Miller,
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`Federal Practice & Procedure § 3914.10 (“[O]rdinarily the district court should not
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`proceed to trial, nor even impose substantial pretrial burdens, pending appeal.”).
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`In these circumstances, a balancing test is inapplicable. Apostol, 870 F.2d at
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`1338 (refusing to assess a stay using “the traditional criteria for obtaining a stay—
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`including demonstrating probability of success on the merits” where the “question
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`on an appeal … is whether the defendant may be subjected to trial”); Goshtasby,
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`123 F.3d at 428 (recognizing the paramount importance of immunity).
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`D. The Board Has The Authority To Stay The Proceeding.
`The Rules provide the Board with the authority to suspend the PPOR
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`deadline. E.g., 37 C.F.R § 42.5(a) (permitting the Board to “determine a proper
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`course of conduct in a proceeding for any situation not specifically covered” and to
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`“set times by order”). Indeed, the Board has already suspended the PPOR
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`6
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`

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`deadlines in this proceeding numerous times, and has suspended the PPOR
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`deadlines in many other proceedings while motions to dismiss on sovereign
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`immunity grounds were considered or for other reasons. See e.g., IPR2017-01186,
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`Paper 13; IPR2014-00070, Paper 19; IPR2013-00383, Paper 7.
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`Further suspension of the PPOR deadline would not run afoul of any
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`statutory or regulatory requirement. Indeed, there is no statutory requirement for
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`when a PPOR must be filed. Rather, § 313 delegates the authority to set the time
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`period for filing the PPOR to the Director. Statutory deadlines imposed in the AIA
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`relate only to other aspects of an IPR proceeding. The Board has ample authority to
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`maintain the status quo and stay this proceeding pending appeal.
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`E. UMN’s Appeal Will Automatically Divest The Board Of
`Jurisdiction Over This IPR Proceeding.
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`UMN requests that the Board stay this proceeding before UMN files its
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`notice of appeal, because that filing will divest the Board of jurisdiction. Griggs,
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`459 U.S. at 58 (“The filing of a notice of appeal is an event of jurisdictional
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`significance—it confers jurisdiction on the court of appeals and divests the district
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`court of its control over those aspects of the case involved in the appeal.”).
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`Because the issue of whether this proceeding can properly move forward on the
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`merits is the very issue to be decided on appeal, filing of the appeal divests the
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`Board of its authority to proceed.
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`The Board follows this “general rule … that the Board is divested of
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`7
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`jurisdiction when either party files a notice of appeal to the Federal Circuit.” Smart
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`Microwave, 2017 WL 3669083, at *1 (denying a request to stay a parallel reissue
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`proceeding after a notice of appeal had been filed from an IPR because jurisdiction
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`over the IPR “was divested from the Board at the time of Patent Owner’s filing of
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`the Notice of Appeal” and staying the reissue was not a permitted ministerial
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`action) (citing In re Allen, 115 F.2d at 939 (“[W]hen a notice of appeal [is filed],
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`jurisdiction of the cause is transferred to this court. There is nothing left for the
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`commissioner to do other than to certify the record and transmit it to this court.”));
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`e.g., Costco, 2017 WL 4102099, at *1 (refusing to permit filing of a motion while
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`appeal was pending). Thus, once the notice of appeal is filed, the Board can only
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`perform “a purely ministerial function.” Loshbough, 359 F.2d at 912; also
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`Captioncall, 2016 WL 8944624, at *2. Continuing on the merits is not “a purely
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`ministerial function,” and the Board may not do so pending appeal.
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`The Board’s adherence to the “general rule” of divestment is consistent with
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`the courts’ treatment of appeals of immunity decisions. See Johnson, 931 F.2d at
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`459 n.2; Williams, 996 F.2d at 729-30 (holding that the notice of appeal following
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`denial of an immunity defense “divests the district court of jurisdiction to proceed
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`against that defendant”); May, 226 F.3d at 879-80; Apostol, 870 F.2d at 1338
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`(holding that an immunity appeal “divests the district court of jurisdiction (that is,
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`authority) to require the appealing defendants to appear for trial”); Stewart, 915
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`8
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`

`

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`F.2d at 574 (holding that following an immunity appeal, “[a]ny subsequent action
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`by [the tribunal] is null and void”); Howard, 2009 WL 2981979, at *1.
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`During the conference call seeking authorization for this motion to suspend,
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`the Board queried whether there was a split in authority on whether jurisdiction is
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`automatically divested by the filing of a notice of appeal. A split exists as to the
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`scope of the divestiture in the context of appeals from decisions on arbitration
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`agreements, but that is not relevant here. See, e.g., Shy, 2014 WL 1818907, at *2
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`(collecting cases). The circuit courts of appeals uniformly hold that the lower
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`tribunal lacks authority to proceed pending appeals of immunity decisions. See
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`e.g., Williams, 996 F.2d at 729-30 (“A number of other circuits have addressed the
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`precise issue on this appeal and have uniformly held that the filing of a non-
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`frivolous notice of interlocutory appeal following a district court's denial of a
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`defendant's immunity defense divests the district court of jurisdiction to proceed
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`against that defendant.” (collecting cases)).
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`Some courts recognize a frivolousness exception but impose a strict
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`requirement that the lower tribunal certify the appeal as “frivolous” before it may
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`retain jurisdiction, and find that jurisdiction is divested in the absence of such a
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`certification. See e.g., Chuman, 960 F.2d at 105 (granting motion to stay pending
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`appeal of immunity defense where the district court did not certify the appeal as
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`frivolous). The frivolousness exception is irrelevant here. The Board’s Order
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`9
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`describes the waiver issue as one of first impression and of sufficient importance to
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`justify an expanded panel. Order at 2-3. While UMN respects the Board’s decision,
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`the Board’s Order cites no binding caselaw that compelled a finding that UMN’s
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`waiver of sovereign immunity in district court extends to an IPR because there is
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`no such authority. Finally, as Judge Harlow noted in concurrence, UMN’s motion
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`to dismiss raises “important constitutional issues” on which court review is
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`“essential.” Concurrence at 2 n.1 (citing Califano, 430 U.S. at 109).
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`Staying The Proceeding Before Divestiture Is Preferred
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`F.
`A stay is a practical and legal necessity. UMN requests that the Board stay
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`this proceeding before UMN files its notice of appeal. Doing so would provide
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`certainty to the parties and would eliminate the need for further proceedings (1) at
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`the Board to address the questions of whether the appeal divests the Board of
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`jurisdiction and whether a stay is a permitted ministerial action. C.f. Smart
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`Microwave, 2017 WL 3669083, at *1 (finding that staying a parallel reissue
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`proceeding after a notice of appeal was not a permitted ministerial action), and (2)
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`at the Federal Circuit to address a motion UMN would otherwise need to file there
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`requesting that the Federal Circuit order the Board to stay this proceeding.
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`Dated: January 9, 2018
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`Respectfully submitted,
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`
`
`By: /Patrick J. McElhinny/
`Patrick J. McElhinny, Reg. No. 46,320
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`10
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`CERTIFICATE OF SERVICE UNDER 37 C.F.R. § 42.6 (e)(4)
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`I certify that on January 9, 2018, I will cause a copy of the foregoing
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`document, including any exhibits or appendices referred to therein, to be served via
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`electronic mail, as previously consented to by Petitioner, upon the following:
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`Kristopher Reed
`Edward Mayle
`David Sipiora
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`Date: January 9, 2018
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`kreed@kilpatricktownsend.com
`tmayle@kilpatricktownsend.com
`dsipiora@kilpatricktownsend.com
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`/Patrick J. McElhinny/
`Patrick J. McElhinny
`K&L GATES LLP
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