The Use of IPR Institution Denial Decisions in Litigation 

Intellectual Property Alert

October 24, 2017

It is not uncommon for a defendant in a patent infringement litigation to file a petition for inter partes review (IPR) before the Patent Trial and Appeal Board.1 An important issue that arises when the PTAB denies institution of an IPR is whether the trial court will allow the patent owner to introduce evidence of that denial at trial.2

District court decisions have gone both ways on the issue, i.e., some district courts have allowed patent owners to introduce evidence of a decision to deny institution of an IPR, and some district courts have precluded such evidence.3 In an October 12, 2017, decision,4 the Eastern District of Wisconsin granted the defendant’s motion in limine to preclude the patent owner from introducing evidence concerning post-issuance proceedings involving the three patents in suit. One of the patents in suit was the subject of at least one ex parte reexamination, one inter partes reexamination (the pre-America Invents Act predecessor to inter partes review proceedings) and four IPRs. Each of the other two patents in suit was the subject of at least one inter partes reexamination and four IPRs.

The District Court first summarized its earlier ruling concerning prior art references/prior art combinations that Snap-On was estopped from relying on in the litigation. In its earlier order, the District Court determined that Snap-On was barred from relying on any prior art that Snap-On reasonably could have relied on — but did not — when it filed its IPR petitions; was barred from relying on any invalidity ground upon which the PTAB instituted trial; but was not barred from relying on any invalidity ground included in its IPR petitions upon which the PTAB did not institute trial.

In its motion in limine to preclude the patent owner from introducing evidence of the PTAB’s denial decisions, Snap-On argued that those decisions were irrelevant. Snap-On argued that because estoppel5 precluded it from relying at trial on any grounds ruled upon in the PTAB’s final written decision issued at the conclusion of the IPRs, the prior art references that Snap-On would introduce at trial would necessarily be different than those considered by the PTAB. Snap-On also argued that explaining to the jury the post-issuance PTO procedures, the relevant legal standards in those proceedings, the evidence the PTO considered in each proceeding, and the outcomes in each proceeding would waste the jury’s time, confuse the jury, and mislead the jury to defer to the PTAB on the issue of validity.

The patent owner countered that the PTO’s decisions upholding plaintiffs’ patents against post-issuance challenges were relevant to opposing Snap-On’s invalidity contentions because the PTO’s decisions showed that Snap-On was rehashing arguments that were already unsuccessful before the PTO. The patent owner also argued that the post-issuance proceedings provided context for the third-party license agreements plaintiffs intended to use to prove damages.

Ultimately the District Court agreed with Snap-On, finding particularly relevant the fact that estoppel prevented Snap-On from arguing invalidity based on prior art that was the subject of an instituted IPR proceeding. The court disagreed with other district courts that had determined that any prejudice resulting from a patent owner’s introduction of evidence of a PTAB denial decision could be remedied by a jury instruction explaining the different legal standards in the PTO and the court. The District Court concluded that the prejudice outweighed the probative value of the PTAB denial decisions. Therefore, the District Court ruled that the patent owner could not introduce evidence of the post-issuance proceedings where the PTO determined the patents in suit were not unpatentable, whether in a decision denying institution or a final written decision in the patent owner’s favor, and, similarly, Snap-On could not introduce evidence of any IPR institutions or favorable statements by the PTO during post-issuance proceedings. However, the District Court also ruled that “[t]he parties may … use as evidence statements made or evidence proffered during the [post-issuance proceedings] so long as this is done without referencing either the [proceedings] or the outcomes.”

1 The Patent Trial and Appeal Board (PTAB) is the branch of the U.S. Patent and Trademark Office (PTO) that conducts “trials,” such as inter partes and post-grant reviews.

2 The PTAB is denying IPR petitions at a steadily increasing rate. IPRs first became available in September 2012, and the first IPR institution decisions issued in 2013. According to statistics recently released by the PTO, the institution rate for IPR petitions has decreased from a high of 87 percent in 2013 to 63 percent in 2017.

3 Compare Wisconsin Alumni Research Foundation v. Apple, Inc., 135 F.Supp.3d 865 (W.D. Wisc. 2015) and Interdigital Communications Inc. v. Nokia Corp., Case 1:13-cv-10-RGA (D. Del. Sept. 19, 2014), where the District Courts precluded the patent owners from introducing evidence of the PTAB’s decisions denying IPR institution, with Universal Electronics, Inc. v. Universal Remote Control, Inc., SACV 12-329 AG (JPRx) (C.D. Cal. Apr. 21, 2014) and StoneEagle Servs., Inc. v. Pay-Plus Solutions, Inc., Case No. 8:13-cv-2240-T-33MAP, 2015 U.S. Dist. LEXIS 79971, *22-*23 (M.D. Fla. June 19, 2015), where the District Courts allowed the patent owners to introduce evidence of the PTAB’s decisions denying IPR institution.

4 Milwaukee Electrical Tool Corp. v. Snap-On Inc., Case No. 14-CV-1296-JPS, D.E. 277 (E.D. Wis. Oct. 12, 2017).

5 Pursuant to 35 U.S.C. § 315, “The petitioner in an inter partes review of a claim in a patent under this chapter that results in a final written decision under section 318(a), or the real party in interest or privy of the petitioner, may not assert either in a civil action arising in whole or in part under section 1338 of title 28 or in a proceeding before the International Trade Commission under section 337 of the Tariff Act of 1930 that the claim is invalid on any ground that the petitioner raised or reasonably could have raised during that inter partes review.” The pre-America Invents Act version of 35 U.S.C. § 315 contained a provision estopping, after a final determination of validity and patentability, an inter partes reexamination petitioner from raising in a litigation arguments that were raised or reasonably could have been raised in the inter partes reexamination proceeding. There is no such estoppel provision with respect to ex parte reexaminations. 



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To discuss any questions you may have regarding the issues discussed in this Alert please contact Martin Pavane at 212-883-4994 or or Darren Mogil at 212-883-4976 or