Post-Grant Estoppel, Overturning Shaw: Uninstituted Claims and Grounds “Could Have [Been] Raised”

In the Central District of California, Caltech alleged that Broadcom and Apple infringed some of its patents on circuits having error correction codes to improve speed and reliability of data transmission. California Institute of Technology v. Broadcom et al., Case Nos 2020-2222 & 2021-1527 (Fed. Cir. Feb. 4, 2022). In response, Apple filed multiple IPR petitions, arguing obviousness over several combinations of prior art. The PTAB, however, found that Apple failed to show that the challenged claims were obvious. Before the district court, Apple and Broadcom attempted to argue that the claims would have been obvious over combinations of new prior art not asserted in the IPR. The CD Cal. granted Caltech summary judgment of no invalidity based upon §315(e)(2) precluding IPR petitioners from raising invalidity arguments at trial that they “reasonably could have raised” in their IPR petitions. Specifically, the estoppel provision is as follows:

" (2)Civil actions and other proceedings.—

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)… may not assert either in a civil action… or in a proceeding before the International Trade Commission… that the claim is invalid on any ground that the petitioner raised or reasonably could have raised during that inter partes review. "

35 USC §315(e). A comparable provision is codified in §325(e) for post-grant reviews.

In Caltech v. Broadcom we consider whether, after having received a final written decision, an IPR petitioner should be estopped from making new, uninstituted §§102/103 arguments in subsequent district court proceedings?

The Court of Appeals stated that even though the accused infringer did not petition on the basis of the same prior art, nor did the Board institute the IPR upon said basis, the accused infringer was still prevented from making the arguments in district court under §315(e). The panel explicitly overruled Shaw Industries Group v. Automated Creel Systems (Fed. Cir. 2016). Shaw held that if the Board did not institute on certain grounds then §315 estoppel does not apply. p20 (“Only the grounds actually at issue in the IPR were raised, or reasonably could have been raised in the IPR. Thus, estoppel did not bar the petitioner in Shaw from presenting a petitioned-for, non-instituted ground in future proceedings because the petitioner could not reasonably have raised the ground during IPR.”); citing also, Synopsis v. Mentor Graphics (Fed. Cir. 2016), stating that uninstituted claims were not precluded or “could [not] have [been] raised” in the first IPR proceeding. Since Shaw, district courts have been split as to whether institution was necessary to invoke estoppel.

The panel reasoned that SAS Institute v. Iancu (SCOTUS 2018) demanded revision to Shaw. SAS stated that partial institutions (and final written decisions) based upon a subset of the challenged claims were not statutory under §314(a) and §318(a). Specifically, the Board previously erred in not instituting petitions on all claims contested after finding a reasonable likelihood that at least one might be unpatentable under §314. After SAS, the Board has unmistakably had an obligation to review the patentability of all disputed claims in a patent during an instituted IPR.

The panel in Caltech took SAS a step further, nevertheless, reasoning that the petition “defines the scope of the IPR” such that not just any claim but also “any ground that could have been raised in a petition is a ground that could have been reasonably raised ‘during inter partes review.’ ” pp22-24. In SAS, the Court referred to §312(a)(3) and its requirement that the petitioner “identif[y] each claim challenged [and] the grounds on which the challenge to each claim is based” in finding that the “petitioner, not the Director, []gets to define the contours of the proceeding.” Since it is the responsibility of the petitioner to articulate the grounds for each challenge, said contention(s) should be and “could have [been] raised” during the earlier IPR under §315. This is the reasoning the panel used to overturn Shaw and drastically extend §315 estoppel to include all possible instituted/uninstituted arguments.

After Caltech, not only is it clear that an invalidity argument based upon the same statute (e.g., §103) yet different prior art would be precluded by §315, but it is also apparent that “all claims and grounds not in the IPR but which reasonably could have been included in the petition” are similarly banned. The implication would be that after a final written decision, a petitioner will be estopped from raising any §§102/103 arguments against any claim, based upon any art, in district court or at the PTO, regardless of the scope of the IPR petition. So, if one only requested institution on the basis of §102 and Reference A, hypothetically, the petitioner would be barred from making subsequent §103 arguments based upon References B & C because those §103 arguments “could have [been] raised” in the original petition.

Accordingly, Caltech provides a much more preclusive estoppel doctrine than the one articulated in Shaw and practitioners should be aware that a FWD in an IPR can foreclose any possible uninstituted arguments, even those based upon different claims, dissimilar art or unique statutes with respect to those asserted in the earlier IPR.