Trials@uspto.gov
`Tel: 571-272-7822
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`Paper 11
`Date: October 22, 2020
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`_______________
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_______________
`APPLE INC.,
`Petitioner,
`v.
`SEVEN NETWORKS, LLC,
`Patent Owner.
`_______________
`
`IPR2020-00707
`Patent 9,712,476 B2
`_______________
`
`
`Before THU A. DANG, KARL D. EASTHOM, and JONI Y. CHANG,
`Administrative Patent Judges.
`
`DANG, Administrative Patent Judge.
`
`
`
`DECISION
`Institution of Inter Partes Review
`35 U.S.C. § 314
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`
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`Tel: 571-272-7822
`
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`Paper 11
`Date: October 22, 2020
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_______________
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`_______________
`APPLE INC.,
`Petitioner,
`v.
`SEVEN NETWORKS, LLC,
`Patent Owner.
`_______________
`
`IPR2020-00707
`Patent 9,712,476 B2
`_______________
`
`
`Before THU A. DANG, KARL D. EASTHOM, and JONI Y. CHANG,
`Administrative Patent Judges.
`
`DANG, Administrative Patent Judge.
`
`
`
`DECISION
`Institution of Inter Partes Review
`35 U.S.C. § 314
`
`
`
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`IPR2020-00707
`Patent 9,712,476 B2
`
`I.
`
`INTRODUCTION
`
`Background
`A.
`Apple Inc. (“Petitioner”) filed a Petition requesting an inter partes
`review of claims 13–18, and 23–28 (the “challenged claims”) of U.S. Patent
`No. 9,712,476 B2 (Ex. 1001, “the ’476 patent”). Paper 2 (“Pet.”). SEVEN
`Networks, LLC (“Patent Owner”) filed a Preliminary Response. Paper 7
`(“Prelim. Resp.”).
`Under 37 C.F.R. § 42.4(a), the Board has authority to determine
`whether to institute an inter partes review. 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 grant Petitioner’s request and institute an inter partes
`review of all challenged claims.
`
`Related Proceedings
`B.
`Petitioner identifies the ’476 patent as the subject of SEVEN
`Networks, LLC v. Apple Inc., 2:19-cv-00115 (E.D. Tex.). Pet. 72.
`
`The ’476 Patent
`C.
`The ’476 patent, titled “Secure End-to-End Transport Through
`Intermediary Nodes,” issued on July 18, 2017, from Application No.
`15/140,284 filed on April 27, 2016, which is a continuation of Application
`No. 14/043,772 (“the ’772 application”) filed on October 1, 2013, now U.S.
`Patent No. 9,344,393 (“the ’393 patent”), which in turn is a continuation of
`Application No. 13/396,464 (“the ’464 application”) filed on February 14,
`2012, now U.S. Patent No. 8,549,587 (“the ’587 patent”), which in turn is a
`continuation of Application No. 12/889,252 (“the ’252 application”) filed on
`September 23, 2010, now U.S. Patent No. 8,127,342 (“the ’342 patent”),
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`Patent 9,712,476 B2
`which in turn is a continuation of Application No. 11/875,785 (“the ’785
`application”) filed on October 19, 2007, now U.S. Patent No. 7,827,597
`(“the ’597 patent”), which then in turn is a continuation of Application No.
`10/339,369 (“the ’369 application”) filed on January 8, 2003, now U.S.
`Patent No. 7,305,700 (“the ’700 patent”). Ex. 1001, codes (54), (45), (22),
`(63). The ’476 patent acknowledges security concerns when information is
`transferred over the Internet, as an eavesdropper may be able to access the
`data after decryption at intermediary network processing nodes. See id. at
`1:33–47. Accordingly, the ’476 patent addresses this problem. Id.
`An illustration of one embodiment of the ’476 patent’s
`communication network is depicted in Figure 1, reproduced below:
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`Figure 1 shows communication network 12 that includes mobile network 14,
`enterprise network 18, and communication management system 16 that
`manages communications between mobile network 14 and enterprise
`network 18. Id. at 2:23–27. Mobile network 14 includes mobile devices 21
`that communicate with an internet protocol (IP) infrastructure through a
`wireless or landline service provider, while enterprise network 18 includes
`email server 34 containing user mailbox 44 accessible using personal
`computer (PC) 38. Id. at 2:27–43. Communication management system 16
`includes management server 28 that includes processor 33 operating transfer
`agent 31, which in turn manages the transactions between mobile devices 21
`and enterprise network 18. User database 42 includes configuration
`information for different users of a mobile communication server. Id. at
`2:52–59.
`As shown in Figure 1, personal client 40 makes outbound connection
`25 to management server 28, registers the presence of a particular user to
`management server 28, and negotiates a security association specifying a
`cryptographic ciphersuite and unique, secret point-to-point encryption key
`29 over connection 25. Id. at 2:64–3:3. Further, mobile device 21
`negotiates a point-to-point security association, specifying a cryptographic
`ciphersuite and a unique encryption key 27, with management server 28. Id.
`at 3:10–12.
`D.
`
`The ’785 Application (also “the ’597 Patent” or “the Great
`Great Grandparent Application”) (Ex. 2010)
`
`Like the ’476 patent, the great great grandparent application addresses
`
`security concerns with eavesdroppers being able to access data after
`decryption at intermediary network processing nodes. See Ex. 2010, 1:7–17.
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`Patent 9,712,476 B2
`An illustration of an encryption schema of the great great grandparent
`application is depicted in Figure 5, reproduced below:
`
`
`
`Figure 5 shows an encryption schema used by mobile device 21,
`management server 28, and personal client 40 when processing transactions
`between a source and a target device. Id. at 8:20–22. As shown in Figure 5,
`mobile device 21 operates as a source for sending transaction 90 requesting
`personal client 40 to send document 92 located in local memory 39, personal
`client 40 operates as a target for transaction 90, and management server 28
`operates as the transfer agent for transferring transaction 90 from mobile
`device 21 to personal client 40. Id. at 8:22–9:2. Any device can operate as a
`source or target for the transaction, wherein personal client 40 can operate as
`a source, and mobile device 21 can operate as a target when transaction 91 is
`sent as a reply to request 90. Id. at 9:6–8.
`Mobile device 21 attaches an “auth_token” to a transaction sent to
`management server 28, wherein mobile device 21 may be required to
`authenticate to management server 28 by transmitting a username and
`password, and server 28 issues mobile device 21 an “auth_token” after
`successfully validating the username and password against information in
`user database 42. Id. at 9:23–10:4. Mobile device 21 then attaches the
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`received auth_token to subsequent transactions sent to management server
`which then uses auth_token to identify and authenticate the source of each
`transaction and to determine where to route the transaction. Id. at 10:4–7.
`
`The Challenged Claims
`E.
`Of the challenged claims, claims 13 and 23 are the independent
`
`claims. Claims 14–18, and 24–28 depend respectively from claims 13 and
`23. Claim 13 is illustrative, and is reproduced below:
`
`13. A method implemented on an intermediary server, the method
`comprising:
`
`receiving a username and a password from a first computer;
`
`authenticating the username and the password with a user database;
`
`issuing a token for the first computer after authenticating the username
`and the password, wherein a first point-to-point security association is
`negotiated with the first computer and a second point-to-point security
`association is negotiated with a second computer;
`
`receiving a transaction message from the second computer, the
`transaction message comprising control data and payload data, wherein
`the control data includes information that provides authentication of a
`source of the transaction and transaction routing information, wherein
`the information includes the token; and
`
`transmitting the payload data to the first computer based on the
`transaction routing information.
`
`Ex. 1001, 12:66–13:18.
`
`F. Asserted Ground of Unpatentability
`Petitioner challenges the patentability of claims 13–18, and 23–28 of
`the ’476 patent on the following ground (Pet. 1):
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`Patent 9,712,476 B2
`Claim(s) Challenged 35 U.S.C. §
`13–18, 23–28
`103
`
`Petitioner relies on the Declaration of Dr. Darrell D. E. Long, Ph.D.
`(Ex. 1003) in support of its unpatentability contentions.
`
`Reference(s)/Basis
`Santamaria1, Suarez2, Boynton3
`
`II. ANALYSIS
`
`Claim Construction
`A.
`We construe claims using the same claim construction standard that
`would be used to construe claims in a civil action under 35 U.S.C. § 282(b),
`including construing the claims in accordance with the ordinary and
`customary meaning of such claims as understood by one of ordinary skill in
`the art and the prosecution history pertaining to the patent. 37 C.F.R.
`§ 42.100(b) (2019). Thus, we apply the claim construction standard as set
`forth in Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc).
`Petitioner proposes the District Court’s claim construction of the
`terms “security association” (claims 13, 23), “token” (claims 13, 23), and the
`preambles (claims 13, 23). Pet. 30–31. At this time, Patent Owner does not
`address Petitioner’s proposed claim construction. See generally Preliminary
`Response.
`
`
`1 U.S. Patent No. 8,725,880 B2, issued May 13, 2014, filed September 20,
`2010 (Ex. 1004, “Santamaria”).
`2 U.S Patent No. 2012/0092438 A1, published April 19, 2012, filed October
`18, 2010 (Ex. 1006, “Suarez”).
`3 U.S. Patent No. 7,305,700 B2, issued December 4, 2007, filed June 8, 2003
`(Ex. 1005, “Boynton,” “the ’700 patent,” “the ’369 application,” or “the
`great, great, great grandparent application”).
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`Only terms that are in controversy need to be construed, and only to
`the extent necessary to resolve the controversy. See Nidec Motor Corp. v.
`Zhongshan Broad Ocean Motor Co., 868 F.3d 1013, 1017 (Fed. Cir. 2017)
`(“[W]e need only construe terms ‘that are in controversy, and only to the
`extent necessary to resolve the controversy’ . . . .” (quoting Vivid Techs., Inc.
`v. Am. Sci. & Eng’g, Inc., 200 F.3d 795, 803 (Fed. Cir. 1999))). At this
`time, we determine that it is unnecessary to construe any claim term
`expressly to determine whether to institute a trial.
`
`B. Discretional Denial under 35 U.S.C. § 314(a)
`Institution of an inter partes review is discretionary, not mandatory.
`See Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2140 (2016) (“[T]he
`agency’s decision to deny a petition is a matter committed to the Patent
`Office’s discretion.”); Harmonic Inc. v. Avid Tech., Inc., 815 F.3d 1356,
`1367 (Fed. Cir. 2016) (“[T]he PTO is permitted, but never compelled, to
`institute an IPR proceeding.”). The decision whether to exercise discretion
`to deny institution under § 314(a) is based on “a balanced assessment of all
`relevant circumstances in the case, including the merits.” Patent Trial and
`Appeal Board Consolidated Trial Practice Guide (Nov. 2019)
`(“Consolidated Trial Practice Guide”), available at
`https://www.uspto.gov/sites/default/files/documents/tpgnov.pdf, at 58 (citing
`General Plastic Indus. Co. v. Canon Kabushiki Kaisha, IPR2016- 01357,
`Paper 19 at 15 (PTAB Sept. 6, 2017) (precedential)). Those circumstances
`include “events in other proceedings related to the same patent, either at the
`Office, in district courts, or the ITC.” Id.
`Patent Owner argues as a preliminary matter that we should exercise
`our discretion to deny institution in this case under 35 U.S.C. § 314(a)
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`because (1) “the District Court will resolve the ’476’s validity over exactly
`the same arguments raised here” (Prelim. Resp. 1), and (2) the Petition is “a
`parallel petition to IPR2020-00279 (‘-0279’), also challenging the ’476
`patent.” Prelim. Resp. 2. We address Patent Owner’s arguments in turn.
`
`C. Parallel District Court Litigation
`When considering the impact of parallel litigation in a decision to
`institute, the Board seeks, among other things, to minimize the duplication
`of work by two tribunals to resolve the same issue. See NHK Spring Co. v.
`Intri-Plex Techs. Inc., IPR2018-00752, Paper 8 at 19–20 (PTAB Sept. 12,
`2018) (precedential) (“NHK”). In NHK, the Board determined that it was
`appropriate to consider the advanced state of a parallel district court
`litigation involving the same issues and an earlier trial date in determining
`whether to exercise its discretion to deny institution under § 314(a). Id.
`In Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (PTAB Mar.
`20, 2020) (precedential) (“Fintiv”), the Board discussed potential
`applications of NHK, and identified a non-exclusive list of factors to
`consider when determining whether a related, parallel district court action
`provides a basis for discretionary denial. Fintiv at 5–16. Those factors
`include:
`1. whether the court granted a stay or evidence exists that one
`may be granted if a proceeding is instituted;
`2. proximity of the court’s trial date to the Board’s projected
`statutory deadline for a final written decision;
`3. investment in the parallel proceeding by the court and the
`parties;
`4. overlap between issues raised in the petition and in the
`parallel proceeding;
`5. whether the petitioner and the defendant in the parallel
`proceeding are the same party; and
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`6. other circumstances that impact the Board’s exercise of
`discretion, including the merits.
`
`Fintiv at 5–6. We authorized the parties to address these factors in a Reply
`(Paper 8 (“Pet. Prelim. Reply”)) and Sur-reply (Paper 9 (“PO Prelim. Sur-
`reply”)).
`We now consider these factors to determine whether we should
`exercise discretion to deny institution under § 314(a). In evaluating the
`factors, we take a holistic view of whether efficiency and integrity of the
`system are best served by denying or instituting review. Fintiv at 6.
`1. Whether a stay exists or is likely to be granted if a
`proceeding is instituted
`
`Petitioner contends that the Petition’s institution would enable the
`Board to efficiently resolve the issue of the ’476 patent’s invalidity, wherein
`that opportunity for simplification “greatly increases the likelihood of a
`District Court stay.” Pet. Prelim. Reply 2–3 (citing NFC Techs. LLC v. HTC
`Am., Inc., Case No. 13-cv-1058, 2015 WL 1069111 (E.D. Tex. Mar. 11,
`2015); Uniloc USA, Inc. v. Samsung Elecs. Am., Inc., Case No. 2:16-cv-642-
`JRG, 2-3 (E.D. Tex. Jun. 13, 2017)).
`Recently, the parties filed a Joint Motion to Stay All Deadlines and
`Notice and Settlement (Ex. 1055) seeking to stay any and all unreached
`deadlines for thirty days in order to finalize settlement and file appropriate
`dismissal papers, and the District Court granted the Motion in an Order (Ex.
`1056). Because a stay exists, albeit temporary, we find that this factor
`slightly weighs against our exercising our discretion to deny institution
`under § 314(a).
`2.
`
`The Trial Date in the Related District Court Litigation
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`The trial in the Eastern District of Texas currently was scheduled to
`begin on November 2, 2020. See Pet. Prelim. Reply 4; PO Prelim. Sur-reply
`3; Exs. 1040, 2001 (Agreed Scheduling Order). Patent Owner contends that
`a final written decision in this matter would be due October 21, 2021, if
`instituted, which is “almost a full year” after the District Court trial. PO
`Prelim. Sur-reply 3 (emphasis in original). Petitioner contends that “there
`are eighteen other cases scheduled to begin jury selection on November 2”
`in the Eastern District of Texas (Pet. Prelim. Reply 4 (citing Ex. 1050, 1–9)),
`wherein, “given the inevitability of further COVID-19 outbreaks, further
`scheduling issues are likely to arise.” Id. (citing Ex. 1047, 1). The parties’
`Joint Motion to Stay All Deadlines and Notice and Settlement indicates that
`the parties “have settled in principle” and they jointly moved the District
`Court to stay the related litigation “in order to finalize the settlement of this
`matter and file appropriate dismissal papers.” Ex. 1055, 1.
`If the District Court’s trial date is earlier than the projected statutory
`deadline, the Board generally has weighed this factor in favor of exercising
`authority to deny institution under § 314(a). Fintiv at 9. However, because
`the District Court has granted a stay of thirty (30) days from the date of the
`Order of October 8, 2020 (Ex. 1056, 1), the jury trial will not occur on
`November 2, 2020 and may not occur at all.
`Further, there are other variables contributing to the uncertainty that a
`jury trial will occur earlier than the projected statutory deadline. First, as
`Petitioner points out, there are eighteen actions pending in the Eastern
`District of Texas, each scheduled for trial on November 2, 2020. Pet.
`Prelim. Reply 4; see Ex. 1050, 1–9. Second, the trial date already has been
`moved once, and the situation is evolving daily. See Ex. 1040 (District
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`Court scheduling order moving the trial date from September 14, 2020 to
`November 2, 2020, as agreed by the parties); Ex. 2001 (same).
`A previous agreement to extend scheduling order dates and
`uncertainty as to whether the trial will actually go forward on the presently
`scheduled date may diminish the extent to which this factor weighs in favor
`of exercising discretion to deny institution. See Sand Revolution II, LLC v.
`Continental Intermodal Group – Trucking LLC, IPR2019-01393, Paper 24 at
`9–10 (June 16, 2020) (informative) (“because of the number of times the
`parties have jointly moved for and the district court agreed to extend the
`scheduling order dates . . . and the uncertainty that continues to surround the
`scheduled trial date, we find that this factor weighs marginally in favor of
`not exercising discretion to deny institution under 35 U.S.C. § 314(a)”).
`Thus, given the District Court’s temporary stay of all deadlines,
`accounting for the previous agreement to extend scheduling order dates and
`uncertainty as to whether the trial will actually go forward on the presently
`scheduled date, we find that this factor weighs against our exercising our
`discretion to deny institution under § 314(a).
`3.
`Investment in the Parallel Proceeding by the
`District Court and the Parties
`
`Patent Owner contends that the parallel district court litigation “is well
`advanced,” and “[t]rial will soon begin.” Prelim. Resp. 11. According to
`Patent Owner, “[e]very key pre-trial event will occur before the DI deadline,
`including the close of fact and expert discovery and responses to dispositive
`motions.” Id.
`According to the most recent scheduling order in the parallel district
`court litigation, most of the deadlines have already passed, with the last, the
`pretrial hearing passing on September 24, 2020. Exs. 1040, 2001. The only
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`upcoming activity in the parallel district court litigation remains is jury
`selection, which has been stayed for thirty days. Id. at 1. We find that the
`parties have invested significant resources in the parallel district court
`litigation, and most of the work already completed in the underlying
`litigation may have relevance to patent validity, including claim construction
`and expert discovery.
`Nevertheless, the potential relevance of such work is greatly
`diminished by the fact that Petitioner’s unpatentability challenges here will
`not overlap with the invalidity grounds that Petitioner will pursue at trial in
`the underlying litigation. See Fintiv factor 4 below; see also Ex. 1045, 2.
`Based on the current record, it is also unclear to what extent the District
`Court has invested resources in the parallel district court litigation that bear
`directly on the issue of patent validity.
`Petitioner’s timing in filing the Petition is also relevant to this factor.
`If the petitioner, “faced with the prospect of a looming trial date, waits until
`the district court trial has progressed significantly before filing a petition,”
`that decision “may impose unfair costs to a patent owner.” Fintiv at 11. On
`the other hand, “[i]f the evidence shows that the petitioner filed the petition
`expeditiously, such as promptly after becoming aware of the claims being
`asserted, this fact has weighed against exercising the authority to deny
`institution.” Id.
`Here, we find Petitioner’s filing timing is reasonable considering that
`Patent Owner’s complaint in the parallel district court litigation asserted
`sixteen patents and over 550 claims, and Petitioner asserts it filed fourteen of
`its inter partes review petitions before Patent Owner’s initial identification
`of asserted claims, and six of the remaining seven petitions within one
`month of it. See Ex. 1052; Pet. Prelim. Reply 4–5 (citing Ex. 1048, 1).
`
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`Weighing the facts in this particular case, including the time invested
`in the parallel district court proceeding by the parties and the District Court,
`the extent to which the investment in the district court proceeding relates to
`issues of patent validity, and the timing of the filing of the Petition, we find
`that this factor weighs slightly in favor of exercising our discretion to deny
`institution under § 314(a).
`4.
`Overlap Between Issues Raised in the Petition and
`in the Parallel Proceeding
`
`This factor evaluates “concerns of inefficiency and the possibility of
`conflicting decisions” when substantially identical prior art arguments are
`submitted in both the district court and the inter partes review proceedings.
`Fintiv at 12. In particular, “if the petition includes the same or substantially
`the same claims, grounds, arguments, and evidence as presented in the
`parallel processing, this fact has favored denial.” Id. (citing Next Caller, Inc.
`et al. v TrustID, Inc. et al., IPR2019-00963, Paper 8 at 11‒12 (same grounds
`asserted in both cases); ZTE (USA) Inc. v. Fractus, S.A., IPR2018-01451,
`Paper 12 at 20 (PTAB Feb. 19, 2019) (same prior art and identical evidence
`and arguments in both cases)).
`Patent Owner argues that Petitioner relies upon substantially the same
`arguments in both the Petition and the District Court action under the same
`claim construction standard. Prelim. Resp. 12–16. In particular, Patent
`Owner contends that “[t]his Petition is first and foremost an attack on
`written description,” wherein in both this proceeding and the District Court
`proceeding, “Petitioner attacks the support of the very same limitations of
`the claims.” Id. at 12–13 (citing Ex. 2006, 162).
`Petitioner argues that it has “eliminated any risk of duplicate effort by
`stipulating to counsel for [Patent Owner] that, if the Board institutes the
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`pending Petition, [Petitioner] will not pursue district court invalidity
`challenges based on the pending Petition’s asserted grounds.” Pet. Prelim.
`Reply 7 (citing Ex. 1045, 1). According to Petitioner, “the District Court
`will not address the validity of all of the claims challenged by the pending
`Petition.” Id. at 8. Petitioner points out that the Santamaria and Suarez
`references, which are asserted in the Petition, are not included in Petitioner’s
`invalidity contentions in the District Court. Id.
`According to Petitioner, Patent Owner characterizes “an invalidity
`challenge based on written description support in the district court litigation
`and a challenge to the effective filing date in an IPR proceeding as being
`‘substantially the same.’” Pet. Prelim. Reply 8 (citing Prelim. Resp. 12).
`However, Petitioner contends that “[t]hese challenges are entirely distinct—
`both as a legal matter and in terms of proof and argumentation required.”
`Id. at 9.
`We agree with Petitioner that the issues in the District Court and in
`the Petition are distinct. Pet. Prelim. Reply 9. In particular, the grounds and
`prior art arguments are different since, as Petitioner points out, the District
`Court is not considering either Santamaria or Suarez as part of any
`combination. Id. at 8; see also Ex. 1012, 157–159. That is, there are no
`“substantial identical prior art arguments” as in Fintiv. See Fintiv 12.
`Unlike Next Caller v. TrustID, the grounds are not the same in both
`proceedings. See Next Caller v. TrustID, Paper 8 at 11‒12. Unlike ZTE v.
`Fractus, in both proceedings, there are no “same art and identical evidence
`and arguments.” See ZTE v. Fractus, S.A., Paper 12 at 20.
`Additionally, although Petitioner as Defendant also contends that the
`asserted claims of the ’476 patent “are invalid under 35 U.S.C. § 112” in the
`District Court proceeding (Ex. 1012, 161–162), Petitioner/Defendant asserts
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`in the District Court proceeding that “the specification does not contain an
`adequate written description and/or enabling disclosure of ‘intermediary
`server’” as used in claim 13, “or ‘server’ as used in claim 23 of the ’476
`patent.” Id. at 164. On the other hand, in the Petition, with respect to
`challenged claims 13 and 23, Petitioner contends that the ’476 patent does
`not disclose “an auth_token issued for one device (e.g., mobile device 21) is
`ever distributed to, or accessible by, an entirely different device (for sending
`in a transaction message having a payload and then transmitted from the
`latter to the former).” Pet. 22. Thus, we disagree with Patent Owner’s
`assertion that, in both of this proceeding and the District Court proceeding,
`“Petitioner attacks the support of the very same limitations of the claims.”
`Prelim. Resp. 12–13 (citing Ex. 2006, 162).
`Furthermore, there is no guarantee that the District Court will even
`consider a patentability challenge to claims 13 and 23 based on 35 U.S.C.
`§ 112. As set forth in Petitioner’s Supplemental Invalidity Contention Cover
`Pleading submitted to the District Court on November 25, 2019, (Ex. 1012,
`159–167), Petitioner identified 56 different combinations of 11 different
`prior art references in addition to the invalidity contention under 35 U.S.C.
`§ 112. Thus, it is not clear that all of the arguments set forth in Petitioner’s
`Supplemental Invalidity Contention Cover Pleading will ultimately be
`decided by the District Court.
`The number of patents-in-suit, claims, and prior art invalidity
`challenges, evidences the complexity of multiple patents and issues in the
`District Court action. A trial here avoids potentially complicated and
`overlapping jury issues of ten patents (Ex. 1012, 159–167), while allowing
`the panel to focus on issues with respect to Santamaria and Suarez that
`involve only the ’476 patent in depth. Therefore, this inter partes trial will
`
`
`
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`16
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`IPR2020-00707
`Patent 9,712,476 B2
`provide the parties with an in-depth analysis of the ’476 patent with respect
`to Santamaria and Suarez, providing a full record that will enhance the
`integrity of the patent system.
`Based on the facts in this particular case, we find that this factor
`weighs strongly against exercising our discretion to deny institution under
`§ 314(a).
`
`5.
`
`Identity of Petitioner and the Defendant in the
`Underlying Litigation
`
`“If a petitioner is unrelated to a defendant in an earlier court
`proceeding, the Board has weighed this fact against exercising discretion.”
`Fintiv at 13–14. Both parties acknowledge that Petitioner here is the
`defendant in the underlying litigation. Pet. Prelim. Reply 10; PO Prelim.
`Sur-reply 10. Thus, this factor weighs slightly in favor of exercising our
`discretion to deny institution under § 314(a).
`
`6.
`
`Other Circumstances That Impact the Board’s
`Exercise of Discretion, Including the Merits
`
`The final Fintiv factor is a catch-all that takes into account any other
`relevant circumstances. The decision whether to exercise discretion to deny
`institution under § 314(a) is based on “a balanced assessment of all relevant
`circumstances in the case, including the merits.” Consolidated Trial Practice
`Guide 58.
`First, we take into account the fact that the Office already has
`instituted proceedings challenging other patents in dispute in the co-pending
`parallel litigation—IPR2020-00188 (instituted June 11, 2020), IPR2020-
`00156 (instituted June 18, 2020), IPR2020-00157 (instituted June 18, 2020),
`IPR2020-00490 (instituted July 8, 2020), IPR2020-00491 (instituted July 8,
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`17
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`IPR2020-00707
`Patent 9,712,476 B2
`2020), IPR2020-00235 (instituted July 28, 2020), IPR2020-00236 (instituted
`July 28, 2020), IPR2020-00255 (instituted July 28, 2020), IPR2020-00285
`(instituted July 28, 2020), IPR2020-00266 (instituted August 14, 2020),
`IPR2020-00279 (instituted August 14, 2020), IPR2020-00180 (instituted
`August 14, 2020), IPR2020-00280 (instituted August 14, 2020), IPR2020-
`00506 (instituted September 1, 2020), and IPR2020-00584 (instituted
`September 1, 2020). We acknowledge that it would be inefficient to
`discretionarily deny institution of this petition, which we find meets the
`statutory threshold for institution, after having instituted petitions
`challenging other patents in dispute in the parallel proceeding.
`Second, considering the merits of the unpatentability arguments in the
`Petition and Patent Owner’s arguments in the Preliminary Response, as
`discussed below in Section II(E), we determine Petitioner has established a
`reasonable likelihood that Petitioner would prevail with respect to the
`challenged claims. As discussed below in Section II(E), we determine that
`the information presented establishes a reasonable likelihood that Petitioner
`would prevail in showing that claims 13–18, and 23–28 of the ’476 patent
`are unpatentable over Santamaria, Suarez, and Boynton.
`In particular, on this preliminary record, Petitioner has made a strong
`showing that the ’476 is not entitled to the priority date of the great great
`grandparent application, and thus, Santamaria, Suarez and Boynton are prior
`art references. See infra Section II(E)(1)(b). And at this stage of the
`proceeding, other than asserting that Santamaria is not prior art, Patent
`Owner does not address the merits of Petitioner’s obviousness assertions
`over Santamaria, Suarez and Boynton. Prelim. Resp. 28–45. On this
`preliminary record, Petitioner has made a strong showing that the
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`18
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`IPR2020-00707
`Patent 9,712,476 B2
`combination of Santamaria, Suarez and Boynton teaches all limitations of
`the challenged claims. See infra Section II(E)(6).
`Accordingly, we determine that the merits of the challenges presented
`in the Petition are strong, and, therefore, favor institution.
`7.
`Conclusion on Discretionary Denial Under § 314(a)
`As noted in Fintiv, we consider the above six factors when taking “a
`holistic view of whether efficiency and integrity of the system are best
`served by denying or instituting review.” Fintiv at 6. As discussed above,
`factors 3 and 5 slightly favor denying institution. Factors 1, 2, 4, and 6 favor
`not exercising our discretion to deny institution. We recognize that
`weighing the Fintiv factors in this proceeding is a close call. However, the
`unique circumstance in this proceeding where the Office has already
`instituted proceedings challenging other patents in dispute in the parallel
`proceeding combined with the strength of Petitioner’s preliminary showing
`of unpatentability and the lack of overlap in the issues that will be pursued in
`this proceeding and in the District Court favor institution of inter partes
`review. As such, we determine that, weighing these factors in a holistic
`analysis, the unique circumstance here outweigh the earlier scheduled trial
`date in the District Court and the investment in the district court litigation.
`Therefore, we are not persuaded that the interests of efficiency and integrity
`of the system would be best served by invoking our authority under § 314(a)
`to deny institution of a potentially meritorious Petition.
`D.
`Parallel Petitioning
`In deciding whether to institute inter partes review, we consider the
`guidance in the Consolidated Trial Practice Guide (“CTPG”), which sets
`forth the following:
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`19
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`IPR2020-00707
`Patent 9,712,476 B2
`Parallel Petitions Challenging the Same Patent. Based on the Board’s
`experience, one petition should be sufficient to challenge the claims of
`a patent in most situations. Two or more petitions filed against the
`same patent at or about the same time (e.g., before the first
`preliminary response by the patent owner) may place a substantial and
`unnecessary burden on the Board and the patent owner and could ra
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