Trials@uspto.gov
`Tel: 571-272-7822
`
`
`
`
`
`
` Paper 10
`Entered: October 23, 2017
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_______________
`
`RADWARE, INC.,
`Petitioner,
`
`v.
`
`F5 NETWORKS, INC.,
`Patent Owner.
`_______________
`
`Case IPR2017-01249
`Patent 6,311,278 B1
`_______________
`
`
`Before KRISTEN L. DROESCH, DAVID C. McKONE, and
`MATTHEW R. CLEMENTS, Administrative Patent Judges.
`
`DROESCH, Administrative Patent Judge.
`
`
`
`DECISION
`Denying Institution of Inter Partes Review
`37 C.F.R. § 42.108
`
`
`
`
`
`Tel: 571-272-7822
`
`
`
`
`
`
` Paper 10
`Entered: October 23, 2017
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_______________
`
`RADWARE, INC.,
`Petitioner,
`
`v.
`
`F5 NETWORKS, INC.,
`Patent Owner.
`_______________
`
`Case IPR2017-01249
`Patent 6,311,278 B1
`_______________
`
`
`Before KRISTEN L. DROESCH, DAVID C. McKONE, and
`MATTHEW R. CLEMENTS, Administrative Patent Judges.
`
`DROESCH, Administrative Patent Judge.
`
`
`
`DECISION
`Denying Institution of Inter Partes Review
`37 C.F.R. § 42.108
`
`
`
`
`
`
`IPR2017-01249
`Patent 6,311,278 B1
`
`I.
`
`INTRODUCTION
`A. Background
`Radware, Inc. (“Petitioner”) filed a Petition (Paper 2 (“Pet”)) for inter
`partes review challenging the patentability of claims 1–7, 10–12, 14, 15, and
`19–26 of U.S. Patent No. 6,311,278 B1 (Ex. 1001, “the ’278 Patent”). See
`35 U.S.C. §§ 311–312. F5 Networks, Inc. (“Patent Owner”) timely filed
`Preliminary Responses (Paper 7, “Prelim. Resp.”). In its Preliminary
`Response, Patent Owner argues that Petitioner failed to identify all the real
`parties in interest. See Prelim Resp. 2–13. With authorization from the
`Board, Petitioner filed a Reply to Patent Owner’s Preliminary Response
`(Paper 8, “RPI Reply”) to address the real party-in-interest issue.
`Section 312 of title 35 of the United States Code establishes the
`requirements of a petition for an inter partes review. Section 312 states, in
`relevant part, that a petition “may be considered only if— . . . (2) the petition
`identifies all real parties in interest.” 35 U.S.C. § 312(a)(2) (emphases
`added). Upon considering the record in its entirety, we are not persuaded
`that Petitioner identified all real parties in interest. Accordingly, we decline
`to consider the Petition, and, therefore, do not institute inter partes review.
`B. Related Matter
`The parties indicate the ’278 Patent is asserted in F5 Networks, Inc. v.
`Radware, Inc., Case No. 16-cv-480-RAJ (W.D. Wash.) (“Washington
`litigation”) Pet. 1; Paper 4, 2.
`
`C. Brief Factual Background
`In 1998, Petitioner, Radware, Inc., was established as a wholly-owned
`subsidiary of Radware, Ltd. in the United States to conduct sales and
`marketing of Radware products. See Ex. 2004, 26, 41, 123; Ex. 2002, 1;
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`Patent 6,311,278 B1
`Ex. 1013 ¶ 2; Ex. 1014 ¶ 2. Petitioner is “a New Jersey corporation engaged
`in selling, marketing, installing, and servicing network management and
`data-security devices, and is the only Radware entity operating in the United
`States.” Ex. 1013 ¶ 3; see Ex. 1014 ¶ 2; Ex. 2004, 26, 41.
`
`Radware, Ltd. was organized in 1996, and incorporated under the
`laws of Israel in 1997. See Ex. 2004, 25. It was co-founded by father and
`son Yehuda Zisapel and Roy Zisapel. See id. at 62–63. Radware, Ltd. “is a
`publically traded Israeli corporation engaged in design, research and
`development, and manufacturing of network management and data-security
`devices,” and “sells the Radware products worldwide, other than in the USA
`and Canada.” Ex. 1013 ¶ 4; Ex. 1014 ¶ 2.
`Co-founder Roy Zisapel has served as President, Chief Executive
`Officer, and Director of Radware, Ltd. since 1996. See Ex. 2004, 63. Co-
`founder Yehuda Zisapel has served as Director of Radware, Ltd. since 1996,
`and Chairman of the Board of Directors from 1996 through 2006, and again
`since 2009. See id. at 62. Yehuda Zisapel and Roy Zisapel are also
`Directors of Radware, Inc. See id. at 62–63. Gadi Meroz is Vice President
`and General Counsel of Radware, Ltd. and also in-house counsel of
`Radware, Inc. See Ex. 1014 ¶ 1; Ex. 2004, 1; Paper 1.
`As mentioned briefly above, the ’278 Patent, along with U.S. Patent
`Nos. 7,472, 413 and 8,676,955, is the subject of the Washington litigation.
`See Ex. 1002. Fabio E. Marino serves as “Attorney[] for Defendant and
`Counterclaim Plaintiff Radware, Inc. and Counterclaim Plaintiff Radware,
`Ltd.” in the Washington litigation. Ex. 2003, 24. Mr. Marino also is lead
`counsel for Radware, Inc., for the Petition now before us. See Ex. 1015 ¶ 1;
`Pet. 2; Paper 1. Prior to the Washington litigation, Radware, Ltd. and
`Radware, Inc., were plaintiffs in a patent infringement action against Patent
`
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`IPR2017-01249
`Patent 6,311,278 B1
`Owner F5 Networks, Inc., in Radware, Ltd. v. F5 Networks, Inc., Case No.
`5:13-cv-02024 (N.D. Cal.). (“California litigation”). See Ex. 2005.
`Mr. Marino also serves as “Attorney[] for Plaintiffs RADWARE, LTD. and
`RADWARE, INC.” in the California litigation. Ex. 2005, 7.
`II. ANALYSIS
`We begin our analysis by explaining who has the burden of
`establishing whether a third party has, or has not, been identified properly as
`a real party-in-interest in a petition, followed by reviewing principles of law
`that generally apply to identifying a real party-in-interest in a given
`proceeding. Finally, we address the parties’ contentions, in the context of
`the parties’ respective burdens, regarding whether Radware, Ltd. is a real
`party-in-interest.
`
`A. Burdens and Legal Principles
`A petition for inter partes review “may be considered only if” the
`petition identifies all real parties in interest. 35 U.S.C. § 312(a)(2)
`(emphasis added). Accurate identification of all real parties in interest
`serves the purpose of assuring proper application of the statutory estoppel
`provisions, and “protect[s] patent owners from harassment via successive
`petitions by the same or related parties.” Office Patent Trial Practice Guide,
`77 Fed. Reg. 48,756, 48,759 (Aug. 14, 2012) (“Trial Practice Guide”).
`The Board generally accepts a petitioner’s identification of real
`parties-in-interest at the time of petition filing. See Changes to Implement
`Inter Partes Review Proceedings, Post-Grant Review Proceedings, and
`Transitional Program for Covered Business Method Patents; Final Rule, 77
`Fed. Reg. 48,680, 48,695 (Aug. 14, 2012) (Response to Comment 9). The
`Trial Practice Guide directs attention to In re Guan, Inter Partes
`Reexamination Proceeding, Control No. 95/001,045, Decision Vacating
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`IPR2017-01249
`Patent 6,311,278 B1
`Filing Date (Aug. 25, 2008), which addresses the application of similar
`principles in the context of inter partes reexamination proceedings. 77 Fed.
`Reg. at 48,759. The Office explained that it “will not look beyond the
`required statement identifying the real party in interest.” Guan at 7. The
`practice of generally accepting the identification of real party-in-interest
`serves as a rebuttable presumption benefitting the petitioner. Zerto, Inc. v.
`EMC Corp., Case IPR2014-01254, Paper 35, slip op. at 6-7 (PTAB March 3,
`2015).
`Pursuant to the Federal Rules of Evidence, which apply to inter partes
`review, “the party against whom a presumption is directed has the burden of
`producing evidence to rebut the presumption. But this rule does not shift the
`burden of persuasion, which remains on the party who had it originally.”
`Fed. R. Evid. 301; see 37 C.F.R 42.62(a). Accordingly, when a patent
`owner provides sufficient evidence prior to institution that reasonably brings
`into question the accuracy of a petitioner’s identification of real parties-in-
`interest, the overall burden remains with the petitioner to establish that it has
`complied with the statutory requirement to identify all real parties-in-
`interest. Zerto at 7. The allocation of the burdens of production and
`persuasion for identification of all real parties in interest appropriately
`accounts for the fact that a petitioner is far more likely to be in possession
`of, or have access to, evidence relevant to the issue than is a patent owner.
`Id.
`
`The real party-in-interest is the party that desires review of the patent,
`and “may be the petitioner itself, and/or it may be the parties at whose behest
`the petition has been filed.” Trial Practice Guide, 77 Fed. Reg. at 48,759.
`“Real party-in-interest” has been used by courts “to describe relationships
`and considerations sufficient to justify applying conventional principles of
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`IPR2017-01249
`Patent 6,311,278 B1
`estoppel and preclusion.” Id. “Whether a party who is not a named
`participant in a given proceeding nonetheless constitutes a ‘real party-in-
`interest’ . . . to that proceeding is a highly fact-dependent question.”
`Id. (citing Taylor v. Sturgell, 553 U.S. 880 (2008)).
`“A common consideration is whether the non-party exercised or could
`have exercised control over a party’s participation in a proceeding.” Trial
`Practice Guide, 77 Fed. Reg. at 48,759. The concept of control generally
`means that “the nonparty has the actual measure of control or opportunity to
`control that might reasonably be expected between two formal parties.”
`Id. (citing 18A Charles Alan Wright, Arthur R. Miller & Edward H. Cooper,
`Federal Practice & Procedure §§ 4449, 4451 (2d ed. 2011) (“Wright &
`Miller”)). “[T]here is no ‘bright-line test’ for determining the necessary
`quantity or degree of participation to qualify as a ‘real party-in-interest’ . . .
`based on the control concept.” Id. (citing Gonzalez v. Banco Cent. Corp., 27
`F.3d 751, 759 (1st Cir. 1994); Wright & Miller § 4451). The Trial Practice
`Guide, however, acknowledges one factual scenario that will generally
`justify applying the real party-in-interest label, namely, a party that funds
`and directs and controls an IPR petition or proceeding. See Trial Practice
`Guide, 77 Fed. Reg. at 48,760. Yet, “whether something less than complete
`funding and control suffices to justify similarly treating the party requires
`consideration of the pertinent facts.” Id. The inquiry into whether a non-
`party wields substantial control “cannot be based on isolated facts,” but
`“must consider the totality of the circumstances to determine whether they
`justify a reasonable inference of a nonparty’s potential or actual involvement
`as a decision maker.” Gonzalez, 27 F.3d at 759. “The non-party’s
`participation may be overt or covert, and the evidence of it may be direct or
`circumstantial—so long as the evidence as a whole shows that the nonparty
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`IPR2017-01249
`Patent 6,311,278 B1
`possessed effective control over a party’s conduct . . . as measured from a
`practical, as opposed to a purely theoretical, standpoint.” Id. The Trial
`Practice Guide emphasizes, “rarely will one fact, standing alone, be
`determinative of the inquiry.” 77 Fed. Reg. at 48,760.
`
`In evaluating whether a non-party exercised or could have exercised
`control over a party’s participation in the proceeding, we may also consider
`whether the entities “are so intertwined that it is difficult for both insiders
`and outsider to determine precisely where one ends and another begins” such
`that an actual measure of control or opportunity to control the filing of and
`participation in an IPR might reasonably be expected between entities in
`such a relationship. Atlanta Gas Light Co. v. Bennett Regulator Guards,
`Inc., Case IPR2013-00453, Paper 88, slip op. at 2–6 (PTAB Jan. 6, 2015);
`see Zerto at 10. In other words, “if a nonparty can influence a petitioner’s
`actions in a proceeding before the Board, to the degree that would be
`expected from a formal copetitioner, that nonparty should be considered a[]
`[real party-in-interest] to the proceeding.” Aruze Gaming Macau, Ltd., v.
`MGT Gaming, Inc., Case IPR2014-01288, Paper 13, slip op. at 12 (PTAB
`Feb. 20, 2015).
`
`
`B. Patent Owner Provides Sufficient Evidence That Reasonably Brings
`Into Question The Accuracy of Petitioner’s Identification of
`All Real Parties-in-Interest
`Patent Owner contends that Petitioner is a wholly-owned subsidiary of
`Radware, Ltd. in the United States, and conducts sales and marketing of
`Radware, Ltd. products and serves as Radware, Ltd.’s authorized
`representative and agent in the United States. See Prelim. Resp. 3 (quoting
`Ex. 2004, 26; Ex. 2002). Patent Owner asserts, “[b]y definition, Radware
`Ltd. can exercise complete control over its subsidiary—including by
`
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`IPR2017-01249
`Patent 6,311,278 B1
`influencing Petitioner’s actions in this proceeding.” Id. at 6–7 (citing
`Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 771–72
`(1984)). Patent Owner argues, “Radware Ltd. and Petitioner also share
`common leadership and financial management, further confirming that the
`parent exercises control over the subsidiary.” Id. at 7 (citing Ex. 2004, 63;
`Ex. 2006, 3); see also id. at 4 (arguing Petitioner and Radware, Ltd. have a
`substantial overlap of leadership and directors). In support of these
`arguments, Patent Owner contends: (1) Roy Zisapel, the President, CEO,
`and director of Radware, Ltd. is also a Director of Petitioner (see id. at 4, 7
`(citing Ex. 2004, 63)); (2) in the Washington litigation, Petitioner identified
`Radware, Ltd. employees as witnesses with knowledge of Petitioner’s
`advertising, sales, and financial information (see id. at 5, 7 (citing Ex. 2006,
`3)); (3) Roy Zisapel served as corporate representative for both Petitioner
`and Radware, Ltd. in the California litigation (see id. at 4, 7); (4) Gadi
`Meroz provided a declaration stating that he is Vice President and General
`Counsel of Radware, Ltd. and the in-house counsel for Petitioner (see id. at
`4 (citing Case IPR2017-00653, Ex. 1024 ¶ 1)); see also Ex. 1014 ¶ 1 (Gadi
`Meroz stating same)); and (5) “Mr. Meroz signed Petitioner’s Power of
`Attorney for this Petition in his capacity as ‘Vice President and General
`Counsel’ of Radware Ltd.” (id. at 5 (citing Paper 1)).
`Patent Owner argues Petitioner and Radware, Ltd. “have a very close
`relationship and near-identity of interests.” Prelim. Resp. 7. Patent Owner
`asserts that, although Radware, Ltd. is not a defendant in the Washington
`litigation and has not been sued for infringement of the ’278 Patent,
`Radware, Ltd. joined the Washington litigation as a counterclaim-plaintiff to
`assert one of its patents against Patent Owner. See id. at 3 (citing Ex. 2003,
`9); see also Ex. 1015 ¶ 2 (confirming Radware, Ltd. is a counterclaim
`
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`IPR2017-01249
`Patent 6,311,278 B1
`plaintiff asserting infringement of one of Radware, Ltd.’s patents).1 Patent
`Owner further contends that Petitioner and Radware, Ltd. have a history of
`litigating jointly against Patent Owner, identifying the California litigation,
`now on appeal before the Federal Circuit. Prelim. Resp. 3–4 (citing
`Ex. 2005); id. at 7. Patent Owner argues that Petitioner and Radware, Ltd.
`are represented by the same outside counsel, Fabio Marino, in the California
`litigation and Washington litigation. See id. at 4 (citing Ex. 2003, 24;
`Ex. 2005). Patent Owner further asserts Mr. Marino currently represents
`Petitioner and Radware, Ltd. in the appeal before the Federal Circuit, and
`represents Petitioner before the Board in these matters, and numerous other
`petitions filed. See id. at 4 (citing Ex. 2005). Patent Owner contends “[a]
`favorable outcome in this proceeding will directly benefit Radware Ltd.”
`Id. at 8.
`In support of its arguments, Patent Owner directs attention to several
`Board cases. Patent Owner directs attention to Zoll Lifecor Corp. v. Philips
`Electronics North America Corp., et al., Case IPR2013-00607 , and argues
`that, similar to facts present in Zoll, Radware, Ltd. wholly owns Petitioner,
`filed suit with Petitioner against F5 in the California litigation, voluntarily
`injected itself into the current Washington litigation, and is represented by
`the same counsel in those proceedings that is representing Petitioner in the
`matters before the Board. See id. at 8–9 (citing Ex. 2010 (Zoll, Case
`
`
`1 Patent Owner argues Radware, Ltd. filed a declaratory judgment action
`challenging the validity of the ’278 Patent. See Prelim. Resp. 12. We
`consider Patent Owner’s argument moot in view of the subsequent
`clarification at the District Court that Radware, Ltd. was not a party to the
`counterclaims for declaratory judgement. See Ex. 1015 ¶¶ 2–4, Ex. 1016,
`Ex. 1017.
`
`9
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`IPR2017-01249
`Patent 6,311,278 B1
`IPR2013-00607, Paper 13 (PTAB Mar. 20, 2014))). Patent Owner also
`directs attention to Aceto Agricultural Chemicals Corp. v. Gowan Co., Case
`IPR2015-01016, and argues that, similar to the facts present in Aceto, there
`is a significant overlap in corporate leadership because key employees such
`as Roy Zisapel hold high-ranking positions with both Petitioner and
`Radware, Ltd., and a Radware, Ltd. employee signed the Power of Attorney
`on Behalf of Petitioner. See id. at 9–10 (citing Ex. 2012 (Aceto, Case
`IPR2015-01016, Paper 15 (PTAB Oct. 2, 2015))). Patent Owner argues,
`“[t]he Board should conclude here, as in Aceto, the blurring of corporate
`boundaries is such that Petitioner was obligated to identify Radware Ltd. as
`a real party in interest.” Id. at 10. Lastly, Patent Owner directs attention to
`Paramount Home Entertainment, Inc. v. Nissim Corp., Case IPR2014-
`00961, and argues that, similar to the facts present in Paramount, Radware,
`Ltd. wholly owns Petitioner, Petitioner and Radware, Ltd. have consistently
`shared counsel, and a common representative, Roy Zisapel, acts and has
`acted on behalf of both entities. See id. at 8 (citing Ex. 2009 (Paramount,
`Case IPR2014-00961, Paper 11 (PTAB Dec. 29, 2014))).
`Petitioner counters that Patent Owner’s reliance on the
`parent/subsidiary relationship between Petitioner and Radware, Ltd. is
`insufficient because “the Board has repeatedly rejected the argument that a
`traditional parent/wholly-owned subsidiary relationship alone renders a
`parent an RPI (especially when the parent is a foreign entity and the
`subsidiary is a U.S. entity).” RPI Reply 1 (citing Daifuku Co., Ltd. v.
`Murata Mach., Ltd., Case IPR2015-01538, Paper 11 (PTAB Jan. 19, 2016);
`Par Pharm., Inc., v. Horizon Therapeutics, Inc., (PTAB Nov. 4, 2015)
`(Paper 13); Samsung v. Gold Charm LTD., Case IPR2015-01416, Paper 12
`(PTAB Dec. 28, 2015); D-Link, Inc. v. Chrimar Sys., Inc., Case IPR2016-
`
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`IPR2017-01249
`Patent 6,311,278 B1
`01425, Paper 15 (PTAB Jan. 17, 2017)). Petitioner emphasizes that the
`analysis looks at the relationship between a party and a proceeding, not the
`relationship between the parties. See id. (citing Daifuku at 7).
`Petitioner further contends that Radware, Ltd. has not controlled these
`proceedings. RPI Reply 2. Petitioner asserts that, although the General
`Counsel for Radware, Ltd., Mr. Meroz, signed the Power of Attorney for the
`Petition before us, Mr. Meroz holds positions with both companies, and
`executed the Power of Attorney as a representative for Petitioner. See id. at
`3 (citing Ex. 1014 ¶ 10). Petitioner also argues that Patent Owner “identifies
`no evidence of actual control by Mr. [Roy] Zisapel over the IPRs,” and “has
`presented no evidence of [Radware, Ltd.]’s control over the IPR.” Id.
`Petitioner further asserts that its identification of Radware, Ltd.’s witnesses
`in its litigation disclosures is no more indicative of control than its
`identification of F5 witnesses. See id. (citing Ex. 1014 ¶ 11; Ex. 2006, 2–3;
`Daifuku at 12). In support of its arguments, Petitioner asserts:
`the Board has found (1) statements in Annual Reports unavailing
`(see Samsung at 4, D-Link at 8); (2) coordinated efforts in
`unrelated litigation irrelevant (see Par at 10); (3) representation
`by same counsel immaterial (see Samsung at 9, D-Link at 8); and
`(4) shared officers and general counsel not determinative when,
`as here, corporate form has been observed (see Daifuku at 9, Par
`at 10).
`RPI Reply 2–3. Finally, Petitioner contends,
`all the cases cited by [Patent Owner] are factually distinguishable
`and involved instances where the petitioner intentionally avoided
`naming a party as an RPI to circumvent estoppel circumvent
`estoppel (see Paramount and Zoll); or where there was
`substantial evidence of the parent’s direct involvement in the IPR
`(see Atlanta Gas); or where petitioner failed to respond to the
`RPI challenge (see Amazon and Aceto). None of these
`circumstances are present here.
`
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`RPI Reply 3.
`Upon reviewing the arguments and supporting evidence presented by
`the parties, we determine that Patent Owner provides sufficient evidence that
`reasonably brings into question the accuracy of Petitioner’s identification of
`real parties-in-interest. Considering the totality of the circumstances, Patent
`Owner’s evidence indicates that Petitioner and Radware, Ltd. have “blurred
`the lines of corporate separation such that the parent could control conduct
`of the inter partes review.” Reflectix, Inc. v. Promethean Insulation Tech.
`LLC, Case IPR2015-00039, Paper 18, slip op. at 9 (PTAB Apr. 24, 2015).
`It is undisputed that Petitioner is a wholly-owned subsidiary of
`Radware, Ltd. See Ex. 1013 ¶ 2; Ex. 1014 ¶ 2. Unlike a holding company-
`subsidiary relationship, where the holding company conducts no
`independent operations (see Daifuku at 8), Radware, Ltd. engages in the
`design, research and development, manufacturing of network management
`and data-security devices, and sale thereof outside of the USA, while
`Petitioner engages in sales, marketing, installing, and servicing of these
`network management and data-security devices in the United States.
`See Ex. 1013 ¶¶ 3, 4; Ex. 1014 ¶ 2; Ex. 2004, 22, 25, 40, 17. As an initial
`example of blurring the lines of corporate separation, Petitioner, in the
`Washington litigation, offered certain Radware, Ltd. employees as potential
`witnesses having knowledge of Petitioner’s advertising and sales of accused
`products in the United States, and revenue derived therefrom, even though
`Petitioner is the entity engaged in the sales and marketing in the United
`States of Radware, Ltd.’s devices. See Ex. 2006, 3; see also Ex. 2004, 63
`(listing Sharon Trachtman as Radware, Ltd.’s Global Marketing Vice
`President). The significant overlap in corporate leadership between
`Petitioner and Radware, Ltd. also is indicative of corporate blurring. Most
`
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`notably Radware, Ltd.’s co-founder, long-term Chief Executive Officer,
`President, and Director Roy Zisapel also serves as a Director for Petitioner.
`See Ex. 2004, 63. In addition, Radware, Ltd.’s Form 20-F indicates that co-
`founder and long-term Chairman of the Board of Directors Yehuda Zisapel
`also serves as a Director for Petitioner. See Ex. 2004, 62. Lastly, Radware,
`Ltd.’s Vice President and General Counsel, Gadi Meroz, also serves as in-
`house counsel for Petitioner, and Mr. Meroz signed the Power of Attorney
`for the Petition before us. See Paper 1; Ex. 2004, 1; Ex. 1014 ¶ 1.
`Patent Owner and Petitioner have conflicting positions regarding
`whether Mr. Meroz executed the Power of Attorney for the Petition on
`behalf of Radware, Ltd. or Petitioner. See Prelim. Resp. 4–5; RPI Reply 3.
`We note that, although the Power of Attorney was signed by Mr. Meroz “on
`behalf of Petitioner RADWARE, INC.,” it nevertheless lists Mr. Meroz’s
`title as “Vice President and General Counsel,” which is his position at
`Radware, Ltd. Paper 1; see also Ex. 1014 ¶ 1 (Mr. Meroz identifies himself
`as “the in-house counsel of Radware, Inc.” and “Vice President and General
`Counsel of Radware Ltd.”). The incorrect listing of Mr. Meroz’s title on the
`Power of Attorney suggests some confusion regarding whether Mr. Meroz
`was acting in his capacity as representative for Petitioner and/or Radware,
`Ltd. See Zerto at 10 (“The evidence of record demonstrates that, because the
`non-named party and named petitioner are so intertwined it is difficult for
`both insiders and outsiders to determine precisely where one ends and the
`other begins, there exists an actual measure of control or opportunity to
`control that reasonably might be expected between entities in such a
`relationship.”).
`The following additional considerations, together with the
`aforementioned indicators of corporate blurring, suggest that Radware, Ltd.
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`has control, or the opportunity to control, the inter partes review before us:
`(1) Petitioner and Radware Ltd’s history of litigating together against Patent
`Owner; and (2) Petitioner and Radware, Ltd.’s shared litigation counsel
`Fabio Marino, who also serves as Petitioner’s lead counsel for the Petition
`before us. See Zoll at 10 (circumstantial evidence showing unified actions
`by petitioner and the non-named party in multi-state patent war with patent
`owner considered among several factors indicating non-named party is a real
`party-in-interest); but cf. TRW Auto. US LLC, v. Magna Elecs. Inc., Case
`IPR2014-01497, Paper 7, slip op. at 9–10 (PTAB March 19, 2015) (shared
`litigation counsel and same counsel representing petitioner did not establish
`parent corporation’s ability to control).
`We recognize that Patent Owner does not provide direct evidence to
`support its argument that Roy Zisapel acts and has acted on behalf of both
`Petitioner and Radware. See Prelim. Resp. 4, 7; RPI Reply 3. Petitioner’s
`evidence, however, indicates that Roy Zisapel receives additional
`compensation for “additional duties and tasks in the United States as
`manager of our entire on-going North Americas activities,” suggesting that
`Roy Zisapel manages the operations of Petitioner. Ex. 2004, 66. In other
`words, the evidence indicates that Roy Zisapel, co-founder and long-term
`Chief Executive Officer, President, and Director of Radware, Ltd., and
`Director for Petitioner with “additional duties and tasks in the United States
`as manager of [the] entire on-going North Americas activities,” wields a
`significant degree of effective control over Petitioner. See Galderma S.A. v.
`Allergan Industrie, SAS, Case IPR2014-01422, Paper 14, slip op. at 12
`(PTAB March 5, 2015) (Paper 14) (finding the President and CEO of both
`parent and subsidiary wields a significant degree of effective control over
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`the inter partes review proceeding––whether exercised or not, it is sufficient
`that he has the power to call the shots (quoting Gonzales, 27 F.3d at 758)).
`When considering the totality of circumstances and the evidence as a
`whole, the corporate blurring between Petitioner and Radware, Ltd., the
`history of litigating together (particularly Radware, Ltd. voluntarily joining
`the Washington litigation so that Petitioner could assert Radware, Ltd.’s
`patent against Patent Owner), and the same shared litigation counsel serving
`as Petitioner’s lead counsel for the inter partes review before us, indicate
`that Radware, Ltd. has the actual measure of control or opportunity to
`control the inter partes review before us that would be reasonably expected
`between copetitioners.
`We are not persuaded by Petitioner’s arguments addressing the
`determinations by other panels of the Board based on certain facts, and its
`argument that Patent Owner’s cited cases are factually distinguishable. See
`RPI Reply 1–3. We recognize that other panels of the Board have indicated
`the following fact patterns, by themselves, were not sufficient to reasonably
`bring into question the accuracy of petitioner’s identification of all real
`parties-in-interest: (1) a parent-subsidiary relationship and common outside
`counsel (see Samsung at 4–11, D-Link at 6–9); (2) a parent-wholly-owned
`subsidiary relationship with an overlapping general counsel/chief
`administrative officer between the two entities (see Par Pharm. at 8–10);
`and (3) a parent holding company-wholly-owned subsidiary relationship
`with an overlapping corporate officer/general counsel between the two
`entities (see Daifuku at 5–13). None of the cases cited by Petitioner and
`Patent Owner, however, contain the same or nearly identical underlying
`facts as the case before us. See also Prelim. Resp. 10–12 (discussing
`distinctions between the underlying facts of each case and the facts before
`
`15
`
`
`
`IPR2017-01249
`Patent 6,311,278 B1
`us). As stated in the Trial Practice Guide, the question of whether a party
`who is not a named participant in an inter partes review constitutes a real
`party-in-interest is a highly fact-dependent question. 77 Fed. Reg. at 48759.
`The totality of the circumstances must be considered to “determine whether
`they justify a reasonable inference of a nonparty’s potential or actual
`involvement as a decision maker.” Gonzalez, 27 F.3d at 759.
`We also are not persuaded by Petitioner’s argument that Patent Owner
`“has presented no evidence of [Radware, Ltd.]’s control over the IPR,” and
`“identifies no evidence of actual control by Mr. [Roy] Zisapel over the
`IPRs.” RPI Reply 3. As explained above, Patent Owner bears the burden of
`production to provide sufficient evidence that reasonably brings into
`question the accuracy of a petitioner’s identification of real parties-in-
`interest. See Zerto at 7. Contrary to Petitioner’s suggestion, the burden of
`production does not require presenting evidence of actual control over the
`proceedings by a non-party. See Aceto at 10 (explaining Patent Owner does
`not bear the burden of proving funding by the non-party). In determining
`whether a non-party has effective control over a named party’s conduct in a
`proceeding, it is important to consider that “[t]he non-party’s participation
`may be overt or covert, and the evidence of it may be direct or
`circumstantial—so long as the evidence as a whole shows that the nonparty
`possessed effective control over a party’s conduct . . . as measured from a
`practical, as opposed to a purely theoretical, standpoint.” Gonzalez, 27 F.3d
`at 759.
`For all of the foregoing reasons, we determine that Patent Owner
`
`provides sufficient evidence that reasonably brings into question the
`accuracy of Petitioner’s identification of real parties-in-interest. Having
`determined that Patent Owner provides sufficient evidence to rebut the
`
`16
`
`
`
`IPR2017-01249
`Patent 6,311,278 B1
`presumption afforded to Petitioner, we next address whether Petitioner
`meets its burden of persuasion to demonstrate that it identified all real
`parties in interest, in compliance with 35 U.S.C. § 312.
`
`C. Petitioner Does Not Establish That it Has Complied With the Statutory
`Requirement to Identify All Real Parties in Interest
`Petitioner contends that Radware, Ltd. is not a real party-in-interest
`because Petitioner is solely responsible for directing, controlling, and
`bearing the costs of these petitions. RPI Reply 1 (citing Ex. 1013 ¶ 7;
`Ex. 1014 ¶ 8). Petitioner contends that Radware, Ltd. has no relationship to
`these proceedings, and, apart from its ownership interest in Petitioner,
`Radware, Ltd. “has no independent interest in adjudicating the validity of the
`’278 Patent because it has not been accused of infringement; nor can it,
`because it has no operations and no direct sales in the U.S.” whereas, “INC
`is the only entity that operates in the U.S., the only entity that makes sales in
`the U.S., and the only entity accused of infringement.” Id. (citing Ex. 1014
`¶¶ 2, 6, 7).2
` Petitioner argues that Petitioner and Radware, Ltd. have not blurred
`corporate lines. See RPI Reply 2. Petitioner asserts that Radware, Inc., and
`Radware, Ltd. are separate companies with separate budgets; they maintain
`separate business records, and pay separate taxes. See id. (citing Ex. 1013
`¶ 2; Daifuku at 9). Petitioner argues the decision to file an IPR, and all
`decisions related to the preparation and filing of the petitions, were made by
`Radware, Inc., alone. See id. (citing Ex. 1013 ¶ 7).
`
`
`
`2 Petitioner addresses Patent Owner’s argument asserting that Radware, Ltd.
`filed a declaratory judgement action for the ’278 Patent. As explained in the
`footnote above, we consider Patent Owner’s declaratory judgement
`argument moot.
`
`17
`
`
`
`IPR2017-01249
`Patent 6,311,278 B1
`We are not persuaded by Petitioner’s uncorroborated testimonial
`evidence that Petitioner is solely responsible for directing, controlling, and
`bearing the cost of the Petition, and that all decisions related to the
`preparation and filing of the Petition were made by Petitioner. For example,
`Petitioner does not provide any explanation to address which ones of
`Petitioner’s Directors and/or employees, such as Roy Zisapel and/or Gadi
`Mero
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