APPLE, INC. v. QUALCOMM, INC.

Before Newman, Prost, and Stoll. Appeal from the Patent Trial and Appeal Board.

Summary: Apple lacked standing to appeal an IPR decision upholding patents that Apple licenses from Qualcomm, in light of a prior decision with identical operative facts

Qualcomm sued Apple for infringement of various Qualcomm patents. In response, Apple petitioned for inter partes review (IPR) of Qualcomm’s patents. The Patent Trial and Appeal Board issued four final written decisions holding Apple did not prove the challenged claims in the patents would have been obvious. Apple and Qualcomm then settled all litigation between the two companies worldwide. The settlement included a six-year license agreement for a large portfolio of patents, including the patents at issue. Apple then appealed the Board’s four final written decisions. In April of 2021, the Federal Circuit found that Apple failed to establish standing to bring a first appeal to a first of the four final written decisions. First, the Federal Circuit rejected Apple’s argument that its payment of royalties under the licensing agreement confers standing, reasoning that the validity of the patents would not impact Apple’s royalty obligations. Second, the Federal Circuit rejected Apple’s assertion of standing based on the possibility that Qualcomm may sue Apple for infringing the patents after the license expires, finding Apple’s assertions lacked the specificity necessary to show that Qualcomm is likely to assert the patents after the expiration of the license agreement. Third, the Federal Circuit rejected the contention that the harm Apple may face from IPR estoppel confers standing, noting Apple failed to show it will likely be engaging in activities that could give rise to a lawsuit based on the patents. Accordingly, the Federal Circuit dismissed the first appeal.

On appeal of a second of the four final written decisions, Apple asserted that the Federal Circuit’s dismissal of the first appeal did not explain why the threat of liability if Apple ceased licensing payments was insufficient for standing. The Federal Circuit concluded that, while the patent at issue in the first appeal is different from the patent at issue in the current appeal, the settlement and the license agreement covered both patents. Additionally, the Federal Circuit concluded that Apple’s declarations in support of standing from the current appeal are the same as Apple’s declaration in support of standing from the first appeal. The Federal Circuit concluded that the two “cases are on all fours” and “the writing is already on the wall.” The Federal Circuit explained, that where, as was the case here, there is a case that is on point, the Federal Circuit is bound by stare decisis. Because the Federal Circuit concluded that the operative facts of the first appeal were the same as the operative facts of the current appeal, it found that that it was bound by the decision in the first appeal and dismissed Apple’s current appeal for lack of standing.

Judge Newman dissented, arguing that, because the first appeal and the current appeal present different issues, different arguments, and different technologic aspects of the devices and because of Apple’s status as a patent licensee, it is “apparent” that Apple has standing to pursue the current appeal.

Editor: Paul Stewart

Written by: Christopher L. Lewis & Karen Cassidy