The US Court of Appeals for the Federal Circuit found that if a prior litigant and an inter partes review (IPR) petitioner's relationship is not sufficiently close such that the prior litigant's proceeding would have given the IPR petitioner a full and fair opportunity to litigate the claims of the same patents, the prior litigant and the IPR petitioner are not privies within the meaning of § 315(b) for timely filing of an IPR. WesternGeco LLC v. Ion Geophysical Corp., Case Nos. 16-2099; -2100; -2332; -2333; -2334 (Fed. Cir., May 7, 2018) (Chen, J).
In 2009, WesternGeco sued ION for infringement of patents directed to technology for controlling the movement of streamers towed behind a ship to explore for oil and gas beneath the ocean floor. In August 2012, the district court found that ION infringed WesternGeco's patents and that ION had failed to prove that any of the asserted patents were invalid.
After receiving a favorable infringement verdict against ION, WesternGeco sued Petroleum Geo-Services (PGS) for infringement of the same patents. In response, PGS filed IPR petitions alleging the claims of the patent were anticipated or obvious. After some of PGS's petitions had been instituted, ION moved to join those proceedings. The PTAB granted ION's request to join PGS's IPRs, but restricted ION's role to "spectator" status, with no right to file papers, engage in discovery, or participate in any deposition or oral hearing. Ultimately, the PTAB invalidated various claims of WesternGeco's patents. WesternGeco appealed.
After briefing was completed in the appeal, PGS settled with WesternGeco and withdrew from the appeal. WesternGeco argued that the IPRs were time-barred pursuant to 35 USC § 315(b) because ION was served with a patent infringement complaint well over a year before PGS's petitions were filed, and ION would have been time-barred from filing any petitions challenging the patents had it not joined PGS's petitions. WesternGeco also argued that PGS's petitions should have been time-barred because it was a "real party of interest" or "privy" of ION.
The Federal Circuit disagreed, finding that § 315(b)'s preclusion provision is to prevent successive challenges to a patent by those that previously had an opportunity to make such challenges in prior litigation. The Court noted that it is important to determine whether the petitioner and the prior litigant's relationship as it relates to the lawsuit is sufficiently close such that the petitioner had a full and fair opportunity to litigate the validity of the patent in that lawsuit. The Court found that ION was not time-barred because it lacked the opportunity to control PGS's IPR petitions, but noted that control is not the exclusive analytical pathway for analyzing privity, and the relationship and agreements between the parties could establish privity.
Time Bar Doesn't Apply To Party Insufficiently Close To Prior Litigant
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