Real Party-in-Interest in Post-Grant Proceedings

A party petitioning for inter partes review (IPR) is required to name all real parties-in-interest (RPIs)—this helps ensure proper application of statutory estoppel and assists the Patent Trial and Appeal Board (PTAB) in identifying potential conflicts. The determination of whether a party is an RPI is based on a highly fact-specific test, and the case law indicates that the analysis largely hinges on factors such as compensation for filing and control of the IPR proceedings.

There are risks associated with improperly naming RPIs. An IPR may be denied or terminated for failure to name all RPIs, and the failure may not be able to be cured if more than one year has passed since the Petitioner or RPI was served with an infringement complaint. The PTAB has considered RPI issues even after institution of trial, and has terminated the proceedings for failure to name all RPIs, where the one-year bar is implicated. There is also a risk of being over-inclusive in naming RPIs because estoppel applies to the Petitioner and any named RPI, barring them from further challenging claims based on any ground that was or could have been raised during the IPR.

As noted, the RPI analysis is highly fact dependent. Former Chief Judge James Donald Smith, PTAB, observed that "[c]ourts and commentators agree … that there is no bright-line test for determining the necessary quantity or degree of participation to qualify as a real party-in-interest." The Board generally accepts the Petitioner's identification of the RPIs. The Patent Owner, however, may rebut the Petitioner's identification of RPIs. In its analysis, the Board considers six "Taylor factors" but has primarily focused on control of and payment for the proceeding. In general, an RPI must have sufficient opportunity to control the IPR, such as when a parent wholly owns a Petitioner and authorizes its budget and plans. Evidence of payments for specific challenges may indicate an RPI, but nonspecific payments by technical/industry organization members have been found to not be enough.Common counsel or participation in related district court proceedings, by itself, is typically not sufficient to establish a third party as a RPI. Yet common counsel, when combined with other factors may be sufficient to establish a third party as a RPI8 where it (1) pays the Petitioner for services, including potential IPR filings, and (2)discusses the Patent Owner and filing of IPRs with the Petitioner.

The RPI analysis will continue to be a highly fact-specific inquiry, and Petitioners must be mindful of the above considerations when filing an IPR, particularly where a Petitioner is part of a larger corporate structure or involved in a joint defense group as part of concurrent district court proceedings. We expect this area of practice to continue to evolve as more fact patterns are considered by the PTAB.

This article originally appeared in Fish's 2015 Post-Grant Report. Read the full report here.