When Should I File an IPR during Litigation?

You have been sued for patent infringement and decided to challenge the validity of the patent at inter partes review ("IPR"). The next major decision you need to make is "when?" Concurrent district court litigation and IPR can have significant impacts on one another. Here are some important factors for deciding the timing of an IPR.

If I want to stay litigation, how early should I file the petition?

To save resources, it is best to seek to stay district court litigation pending the outcome of an IPR. Filing your IPR early and promptly and then seeking a stay is generally the best course of action.

As a general rule, district courts are sometimes hesitant to stay litigation until the Patent Trial and Appeal Board ("PTAB") has instituted review of your petition. Similarly, district courts can also be reluctant to grant a stay if a substantial investment in the discovery process has already occurred, such as if expert reports are being developed.

Likewise, the PTAB has the discretionary authority to deny institution of a petition and is more likely to do so if the related litigation is farther along. Accordingly, a litigant is more likely to obtain both a stay of district court litigation and institution of the IPR if the petition is filed earlier in litigation, ideally before significant discovery has occurred.

Do you know which claims will be asserted?

Plaintiffs are not required to identify all asserted patent claims in their Complaint. Moreover, different courts will have different schedules for the disclosure of asserted claims, which are sometimes dictated by Patent Local Rules and other times by the defendant promptly seeking disclosure through interrogatories.

Knowing which claims are asserted is critical to the timing and effectiveness of an IPR. Word count restrictions on an IPR petition make it difficult or impossible to challenge all claims of an asserted patent in a single petition. But even if you could, challenging non-asserted claims is a waste of resources. Moreover, recent guidance from the PTAB makes it difficult to get multiple petitions instituted against the same patent.

How will IPR claim construction affect litigation?

Until recently, the PTAB construed claims at IPR under the same standard applied by patent examiners during prosecution, which is called the broadest reasonable interpretation ("BRI"). Federal Courts, however, construe claims more narrowly under the standard adopted by the en banc Federal Circuit in Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005). This mismatch meant that litigants could propose and district courts were relatively free to adopt different claim constructions than those adopted by the PTAB during a related IPR, and vice versa.

In 2018, however, the Patent Office released a final rule that required the PTAB to apply the Phillips standard for claim construction in IPRs and similar post-grant proceedings. Using the same standard as Federal Courts increases the likelihood that the PTAB will use claim constructions adopted in prior related litigation or ITC proceedings. If an IPR is brought before the related litigation reaches claim construction, judges may be more likely to adopt the constructions of the PTAB.

Defendants now have to consider who they would rather have first construe claims, the subject matter experts at the PTAB or the generalists on the federal bench. This will also require closer coordination if the defendant is using different firms or groups of attorneys for the district court litigation and IPR. In some circumstances, such as when claim construction arguments related to indefiniteness or means-plus-function interpretation, defendants may wish to have such issues settled by the district court prior to filing an IPR petition to keep arguments consistent across the forums.

Defendants should also be aware that arguments made by the patent owner in the IPR can impact the litigation in several ways. First, a statement by the patent owner during IPR can support a finding of prosecution disclaimer. That is, if the patent owner argues that a particular element is not covered by a claim during the IPR proceedings, including before an institution decision, the patent owner may be estopped from then later asserting in litigation that such element is covered by the claim. Similarly, prosecution history estoppel could prevent a patent owner from asserting infringement under the doctrine of equivalents if the patent owner argues during the IPR that a claim is valid due to differences from the prior art equivalent.

How will estoppel affect litigation?

Prior art that can be asserted during an IPR is limited to patents and printed publications. If a petitioner brings an IPR and the PTAB issues a final written decision, however, the petitioner is estopped from asserting any invalidity ground in related litigation that they raised or reasonably could have raised at the IPR. In practice, this estoppel generally applies to any patents or printed publications that could have been identified through reasonable searching. Defendants who file a petition and discover important prior art (patents or printed publications) afterwards may therefore be precluded from asserting that art during litigation. Defendants will have to consider carefully whether they have diligently searched for prior art before filing a petition. One factor to consider when filing an IPR and the estoppel effect is whether system prior art and witness testimony may be available in the litigation should the IPR not result in invalidity, while optically still a challenge if it was closely related to the printed publications, it could not have been considered by the PTAB and may preserve a strong challenge to the validity of the patent.

All things considered:

In general, filing a petition for IPR earlier rather than later in related litigation, ideally before any significant discovery has occurred, increases the likelihood of getting an institution at the PTAB and stay at the district court. However, waiting at least until the patent owner identifies the asserted claims can allow for a more focused IPR petition. Defendants should ensure they have diligently searched for prior art before petitioning, lest they be estopped once the PTAB issues its final written decision. Under the now-uniform Phillips claim construction standard, the PTAB's constructions may be more likely to impact claim construction in related litigation. Patent infringement defendants should consider all these factors when ultimately deciding the best time to file their petition for IPR.

More questions? Contact the authors or visitFish's Intellectual Property Law Essentials.

Authors: Rick Bisenius, Dan Smith, and Ryan Petty