Invalidity Contentions as IPR Estoppel Markers

Invalidity Contentions Serve as Estoppel Benchmark

A Patent Owner may only avail itself of an IPR estoppel defense in court upon demonstrating that a competent prior art search would have uncovered the art that is asserted post-IPR (i.e., raised or reasonably could have raised during the IPR. 35 U.S.C. § 315(e)(2))  This demonstration of proof can be complicated by a number of factual questions such as the degree of skill of the searcher, the complexity of the art, and what was known by the petitioner and when.

A recent decision in the Southern District of Texas looks to simplify such disputes by utilizing invalidity contentions as estoppel markers.

In Neuro Cardiac Technologies, LLC v. Livanova, Inc., No. H-18-1517, the court analyzed how to preemptively address estoppel after a petition for inter partes review has been filed, but prior to an institution decision being issued.  While granting a stay in the case pending denial or completion of the inter partes review proceeding, the court opted to require the parties to follow through with the exchange of infringement and invalidity contentions as originally scheduled.  As the Court explained (here):

" Neuro-Cardiac points out that because the PTAB has not yet granted inter partes review, whether or to what extent estoppel applies is unclear. The estoppel provisions under the America Invents Act implicate two categories of invalidity grounds: (1) grounds that the petitioner raised in the inter partes review petition on which the PTAB declined to institute review; and (2) grounds that the petitioner did not raise in its petition, but reasonably could have. Neuro-Cardiac argues that without having LivaNova’s invalidity contentions, resuming the case after the stay is lifted will take weeks longer because a central issue will be the scope of estoppel following either the denial or completion of inter partes review.

(internal citations omitted)

In finding that the contentions should be filed despite the early stay, the Court explained that this approach would “[r]educ[e] any delay associated with restarting the litigation if the PTAB declines review,” and that there was little evidence demonstrating any prejudice to the parties.  While the scope of estoppel may still be litigated after the result of the inter partes review, the parties still have the opportunity to lay out all of their positions that may be affected by the pending IPR.

Scott A. McKeown is an author of the Patents Post Grant.