Trials@uspto.gov
`571-272-7822
`
`Paper 13
`Entered: September 18, 2017
`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`__________
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`__________
`LUV’N CARE, LTD.,
`Petitioner
`
`v.
`MICHAEL L. MCGINLEY,
`Patent Owner
`__________
`Case IPR2017-01216
`Patent 8,636,178 B2
`
`
`
`Before LYNNE H. BROWNE, SUSAN L. C. MITCHELL, and
`JAMES J. MAYBERRY, Administrative Patent Judges.
`
`BROWNE, Administrative Patent Judge.
`
`
`
`DECISION
`
`
`Denying Institution of Inter Partes Review
`37 C.F.R. §§ 42.71 and 42.108
`
`
`
`
`
`
`

`

`IPR2017-01216
`Patent 8,636,178 B2
`On March 30, 2017, Luv N’ Care, Ltd. (“Petitioner”) attempted to file a
`petition for inter partes review of U.S. Patent No. 8,636,178, but payment was not
`received by the Office on that date. See Paper 3, 2; Ex. 1011 ¶¶ 3, 6. After
`discovering that payment had not been received by the Office, Petitioner
`successfully filed a Petition for Inter Partes Review of U.S. Patent No.
`8,636,178 B2 (“Petition”) on April 11, 2017, and was accorded that filing date.
`Papers 1, 6. On that same day, Petitioner filed a Motion to Assign a Filing Date
`(“Motion”) with the Affidavit of Kyle Phillip Bailey (“Affidavit”) in support
`thereof to have the Petition accorded a filing date of March 30, 2017, when the first
`attempt was made to file the Petition. Paper 3, 3; Exhibit 1011 ¶ 3.
`On June 22, 2017 we issued an Order to Show Cause granting Petitioner five
`business days from the date of the order to show cause why its Motion to Assign
`Filing Date should not be denied. Paper 7, 4. Petitioner did not respond to the
`Order to Show Cause. On July 26, 2017, Michael L. McGinley (“Patent Owner”)
`filed a Preliminary Response to the Petition. Paper 8.
`The Board institutes an inter partes review on behalf of the Director.
`37 C.F.R. § 42.4(a). One threshold consideration in our institution decision is
`whether a petition is timely filed. See 35 U.S.C § 315(b). Accordingly, we must
`first rule on Petitioner’s Motion to determine the proper filing date for the Petition
`before deciding if we should institute trial. The patent statute sets forth
`requirements that must be satisfied for an inter partes review petition to be
`considered, such as inclusion of certain documents, payment of fees, and providing
`copies of documents to the designated representative of the patent owner. See 35
`U.S.C. § 312(a). The applicable regulations clarify that a petition will not be
`accorded a filing date until the petition satisfies the following: (1) the content of
`the petition complies with 37 C.F.R. § 42.104, (2) the fee to institute has been paid,
`see 37 C.F.R. §§ 42.15(a), 42.103(b), and (3) the petition and relevant documents
`
`
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`2
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`IPR2017-01216
`Patent 8,636,178 B2
`have been served on the patent owner. 37 C.F.R. § 42.105(a). The question before
`us is whether these conditions have been met. In particular, whether the fee for
`institution has been timely paid.
`
`The Petitioner, as the moving party, has the burden of proof to establish that
`it is entitled to the requested relief. 37 C.F.R. § 42.20(c). As explained below,
`Petitioner has not met this burden. Accordingly, we deny the Motion.
`Based on the April 11, 2017, filing date, the Petition is barred under
`35 U.S.C. § 315(b). Accordingly, we also deny institution of an inter partes
`review.
`
`BACKGROUND
`I.
`On March 30, 2017, Petitioner successfully uploaded the Petition and related
`exhibits using the PTAB E2E filing system. Motion 2 (citing Bailey Aff. ¶ 3;
`Ex. 1011). Mr. Bailey states that the Petition and exhibits were filed on March 30,
`2017. See id. Mr. Bailey states that a payment of $23,000.00 was submitted using
`Deposit Account No. 505393 and that this deposit account was sufficiently funded.
`Id. at ¶ 4. Mr. Bailey states that he received a receipt dated March 30, 2017,
`indicating that payment was in process. Id. at ¶ 5.
`According to PTO records, an attempt to pay the filing fee was made on
`March 30, 2017, and that payment was made on April 11, 2017. Exhibit 3001.
`The record of Petitioner’s deposit account 505393 for March 2017 (Exhibit 3002)
`indicates that at the time the first attempt was made to pay the filing fee,
`Petitioner’s account held insufficient funds to cover the filing fee. This record
`further indicates that on March 31, 2017, sufficient funds were added to
`Petitioner’s deposit account; however, no attempt was made at that time to pay the
`filing fee.
`Petitioner’s Motion and declarations detail Petitioner’s payment attempt and
`subsequent successful payment. However, Petitioner’s statements with respect to
`
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`IPR2017-01216
`Patent 8,636,178 B2
`the sufficiency of funds available in Petitioner’s deposit account and the receipt
`received after the payment attempt is not fully supported by the information
`presented in Exhibits 1011, 3001, and 3002.1
`Petitioner’s attempted payment occurred on March 30, 2017. Ex. 1011.
`Petitioner states that a receipt for payment of $23,000.00 was received on that date.
`Motion 2 (citing Bailey Aff. ¶ 3; Ex. 1011). Exhibit 1011 shows the proffered
`receipt for that payment attempt. The first page of the Exhibit specifically states,
`in bold: “Your Payment Has Not Been Cleared for AIA Review IPR2017-
`01216! Please call system administrator with any questions[.]” Ex. 1011, 1.
`Petitioner does not address this warning.
`Petitioner states that it was informed that the payment was not processed by
`the PTAB E2E system due to an internal computer issue. Motion 2 (citing Bailey
`Aff. ¶ 6; Ex. 1011). Petitioner further states that payment was reinitiated and a
`filing date of April 11, 2017, was granted. Motion 3. Petitioner does not explain
`the more than 10 day delay in submitting payment.
`As the above payment attempt reflects, Petitioner attempted a deposit
`account payment greater than funds available in the deposit account, did not
`address the explicit warning message indicating that the payment had not cleared,
`and waited approximately 10 days to make payment.
`II. DISCUSSION
`The statute, rules, and applicable PTO guidance concerning the requirements
`for filing a petition are clear and consistent – before a filing date is assigned to a
`petition seeking an IPR, the petition must be complete, which includes the PTO
`
`
`1 Ex. 3001 is an audit trail showing Petitioner’s attempt to make payment at 48:16:5
`and successful payment at 15:41:9. Ex 3002 is a screen shot showing the activity
`in Petitioner’s deposit account during March and April of 2017.
`
`
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`IPR2017-01216
`Patent 8,636,178 B2
`receiving the required fee. In accordance with the patent statute a petition for IPR
`“may be considered only if the petition is accompanied by payment of the fee
`established by the Director under section 311.” 35 U.S.C. § 312(a)(1). This statute
`is not jurisdictional. See Lumentum Holdings, Inc. v. Capella Photonics, Inc., case
`IPR2015–00739, slip op. at 4–5 (PTAB Mar. 4, 2016) (Paper 38) (precedential).
`However, absent a showing of good cause, as discussed further infra, and in
`accordance with our rules also discussed infra, we will not waive the fee
`requirement in this case.
`Our rules follow the statutory requirement and establish that the full
`payment must be received, not merely tendered, in order to be considered as
`“accompanying” the petition. Rule 42.103 states that “[n]o filing date will be
`accorded to the petition until full payment is received.” 37 C.F.R. § 42.103(b).
`Rule 42.106, titled “Filing date,” states that a petition to institute an IPR “will not
`be accorded a filing date” until the petition satisfies the requirement that the
`petition “[i]s accompanied by the fee to institute required in § 42.15(a).” 37 C.F.R.
`§ 42.106(a)(3). Rule 42.106 also states that “[w]here a party files an incomplete
`petition, no filing date will be accorded . . . .” 37 C.F.R. § 42.106(b).
`The PTO website provides extensive, consistent guidance stating that
`payment of the filing fee is required to obtain a filing date for an IPR petition.
`E.g., Ex. 2003, 2 (“It is important to note that a petition will not be accorded a
`filing date unless it is accompanied by a payment of the appropriate fees . . . .”); id.
`at 8 (“[N]o filing date will be accorded if a statutory requirement is not satisfied.
`For example, for fee deficiencies, the Office will accord the later submission date
`when all appropriate fees have been paid because the fees are required by statute.
`See, e.g., 35 U.S.C. § 312(a)(1).”); id. (a filing date requires the “[a]ppropriate fee
`successfully paid”).
`
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`IPR2017-01216
`Patent 8,636,178 B2
`The evidence of record does not demonstrate that good cause exists to waive
`the fee requirement of § 312(a)(1). The evidence of record shows that Petitioner’s
`deposit account was not fully funded at the time that the first attempt was made to
`pay the filing fee for the Petition. Ex. 3002. When a deposit account has
`insufficient funds to cover the amount of a payment, the system properly processes
`the tendered payment by not accepting the payment. There is no persuasive
`evidence of record that there was an internal computer error by the PTAB E2E fee
`processing system that prevented payment of the filing fee on March 30, 2017.
`Further, Petitioner failed to respond to our Show Cause Order of June 22, 2017,
`where we gave Petitioner the opportunity to provide additional evidence in support
`of its Motion. Petitioner’s failure to respond to our Show Cause Order provides
`additional support for our finding that good cause has not been shown in this
`instance.
`
`III. CONCLUSION RE FILING DATE
`Based on the evidence and the totality of circumstances, we determine that
`Petitioner has not met its burden of establishing that it is entitled to have the filing
`date changed in this proceeding. Accordingly, Petitioner’s Motion is denied. The
`filing date for the Petition remains as April 11, 2017.
`IV. STATUTORY BAR TO INTER PARTES REVIEW
`Whether Petitioner is barred from pursuing an inter partes review
`under 35 U.S.C. § 315(b) is a threshold issue. Section 315(b) of Title 35 of
`the United States Code provides:
`An inter partes review may not be instituted if 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.
`Petitioner states that “[a] complaint alleging infringement of the ‘178 patent
`was filed on March 30, 2016. Service of the complaint alleging patent
`
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`IPR2017-01216
`Patent 8,636,178 B2
`infringement was effected on March 31, 2016, less than one year ago.” Pet. 1.
`Thus, in the absence of a March 31, 2017 filing date, this IPR will be considered
`“untimely” under 35 U.S.C. § 315(b). The filing date of the Petition is April 11,
`2017, more than one year after service. Accordingly, the Petition is barred under
`35 U.S.C. § 315(b).
`
`V. ORDER
`In consideration of the foregoing, it is hereby:
`ORDERED that Petitioner’s Motion is denied; and
`FURTHER ORDERED that institution of an inter partes review of any
`challenged claim of Patent No. 8,636,178 B2 is denied under 35 U.S.C. § 315(b).
`
`
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`IPR2017-01216
`Patent 8,636,178 B2
`PETITIONER:
`
`Robert M. Chiaviello, Jr.
`NUBYLAW
`bobc@nuby.com
`
`PATENT OWNER:
`
`James J. Kernell
`ERICKSON KERNELL IP, LLC
`jjk@kcpatentlaw.com
`
`
`
`8
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`