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Waves of IPRs Against Alacritech-Owned Patents in 2017 May Test PTAB’s Limits Regarding Joinder Practice

Seven new IPRs were filed against patents held by Alacritech Inc. on December 27, 2017. These IPRs (four of which were filed by Dell and three by Cavium) join eight others filed by Intel, Dell, or jointly by Wistron, Wiwynn, and SMS InfoComm since November. Earlier in the year, 24 IPRs were filed against Alacritech-held patents by Cavium and Intel.

To provide context for the 39 IPRs filed against Alacritech in 2017, Alacritech operated in the area of network interface devices and network storage but appears to have ceased manufacturing activity in late 2013. Alacritech’s website, as it stands today (and as it appears to have read since December 2013), states that “Alacritech continues to license its patented accelerator technology,” and that it will continue to support existing customers, but that it is no longer manufacturing its products.

All seemed quiet on the legal front in 2014 and 2015, but on June 30, 2016, Alacritech filed suits in the Eastern District of Texas against Dell (in which Cavium and Intel later intervened); SMS InfoComm, Wistrom, and Wisynn Corporations; and against CenturyLink, CenturyLink Communications, Cyxtera, and Tier 3. Eight patents were asserted across the three cases.

Intel responded by filing 12 IPRs between May and June of 2017. While these petitions were pending, Cavium also filed 12 IPRs between June and July of 2017. Cavium filed motions for joinder for each of its IPRs to the corresponding Intel IPRs.  Institution decisions came down in November and December, with Cavium being granted joinder on the instituted grounds.

Of the 12 sets of IPRs, institution was granted to at least some asserted grounds in seven. Of the eight patents involved in the IPRs, at least some asserted grounds were instituted against six. The remaining patents with no instituted ground were U.S. Patent Nos. 7,945,699 and 8,805,948.

On November 21 and 22, 2017, Intel filed two additional IPRs, each referencing an IPR denied in the first wave of IPRs (including one targeting the ’948 patent, for which no grounds had been instituted) where the denial was due to what the board deemed to be a failure to demonstrate that an asserted reference was available as prior art, and each providing supplementary evidence of the references’ statuses as prior art publications. As we have covered in more depth in several previous articles, demonstrating the status of an asserted reference as a printed publication is becoming an increasingly important point that must be adequately addressed in a petition itself.

Around this time in the underlying litigation, the three district court cases were stayed pending resolution of the IPRs. The order, entered on December 5, 2017, stayed the cases pending final written decisions or decisions not to institute of 22 of the 26 IPR proceedings that had been filed at that time (we have not been able to determine the rationale of the missing IPR proceedings—none of the missing proceedings had been terminated at the time of the order, and one of the IPRs not listed in the stay had already been instituted at the time of the stipulation leading to the stay).

In December 2017, Dell began filing their own IPRs, beginning with three IPRs filed on December 20, followed by another four on December 27. These petitions asserted identical grounds to the seven already instituted IPRs filed by Intel and already joined by Cavium. While these petitions would normally be time barred as having been filed more than one year after Dell was served in the underlying litigation, this time bar does not apply to joining an existing IPR. The grant of a joinder in such a situation is discretionary, however.

Dell’s petitions and motions for joinder seem to have been filed in a way to minimize concerns that the Board might have regarding joinder. For example, the IPRs were all filed within a month or so of the institution of the earlier-filed IPRs, all explicitly state that they will have no change in the instituted grounds or to the existing schedule, and all state that Dell only intends to assume an active role in the proceedings in the events that Intel and Cavium “are no longer a party to these proceedings.”

On December 21, 2017, Wistron (with SMS InfoComm and Wiwynn) similarly filed three IPRs seeking joinder to already instituted Intel-filed IPRs (also filed within one month of institution, asserting no impact to the existing schedule, and stating that the parties would not have an active role unless other earlier-filing parties attempt to terminate their IPRs). Unlike Dell, Wistron does not yet appear to have filed IPR petitions seeking joinder to the remaining four instituted IPRs. If Wistron would do so now, they would not be able to claim that they had filed within one month of the institution of the remaining IPRs.

Coming finally to the remaining December 27, 2017, filings, Cavium filed three IPR petitions asserting previously rejected grounds. Two of these petitions seek joinder to the November filings by Intel that attempt to demonstrate the prior art publication status of previously questioned references. The third IPR presents essentially the same argument as a previously denied IPR for the ’699 patent, but with supplementary declarations regarding the prior art publication status of a reference.

In summary, with the 39 IPR petitions filed against Alacritech-owned patents in 2017 accounted for above, seven IPRs (filed by Intel and with Cavium having been granted joinder) are currently instituted against six Alacritech patents.  Two Alacritech patents at issue in the district court do not currently have any grounds successfully instituted against them.

Currently pending in the pre-institution phase at the board are five IPRs (two by Intel with Cavium seeking joinder and one additional IPR by Cavium) all similarly attempting to address issues with the status of certain references as prior art publications. Also pending are IPRs filed by Dell requesting joinder to the seven instituted proceedings, and IPRs by Wistron requesting joinder to three of the seven. With a total of 12 motions for joinder before the board, in addition to the seven motions previously granted with regard to Cavium, it will be interesting to observe whether the PTAB is convinced by arguments that the parties will only take an observational role unless the senior filers “are no longer a party to these proceedings,” or whether up to three motions for joinder on a single petition might be too much for the Board, even if the parties have stated they will only have an “understudy” role.[1]

 

[1] A non-exhaustive review of PTAB joinder practice revealed a case in which the PTAB granted joinder to two parties, Akorn Inc. and Teva Pharmaceuticals USA, Inc., to IPR2016-01128, Mylan Pharmaceuticals Inc. v. Allergan, Inc. where both parties agreed to an understudy role. A joinder was denied to a third party, Famy Care Limited, where the party wished to use their own expert and asserted a right to present their own arguments at oral argument, in addition to Mylan.