Decision Identifying Six Factors For Deciding If IPR Should Be Instituted in View of an Ongoing Parallel Proceeding Is Designated Precedential

May 27, 2020

Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (PTAB Mar. 20, 2020) was designated by the PTAB as precedential on May 5.  This decision concerns the PTAB’s discretion under 35 U.S.C. § 314(a) to decline to institute IPR under certain circumstances, including if a parallel proceeding is ongoing.  Fintiv argued in response to Apple’s Petition that the PTAB should deny institution pursuant to § 314(a) in view of parallel district court litigation that will go to trial in late November 2020 and decide the same issues involved in the IPR before a Final Written Decision issues in the IPR.  While Apple’s Petition briefly discussed this issue, a trial date had not yet been set by the district court.  The PTAB ordered supplemental briefing in view of the apparent change in the status of the parallel proceeding, and instructed the parties to address six factors, explaining that PTAB cases addressing an earlier trial date as the basis for denying institution under NHK Spring Co. v. Intri-Plex Techs., Inc., IPR2018-00752, Paper 8 (PTAB Sept. 12, 2018) (precedential, designated May 7, 2019), “have sought to balance considerations such as system efficiency, fairness, and patent quality.” Dec. at 5.  These factors are:

1. Whether the court granted a stay or evidence exists that one may be granted if a proceeding is instituted; 
2. Proximity of the court’s trial date to the Board’s projected statutory deadline for a final written decision; 
3. Investment in the parallel proceeding by the court and the parties; 
4. Overlap between issues raised in the petition and in the parallel proceeding; 
5. Whether the petitioner and the defendant in the parallel proceeding are the same party; and 
6. Other circumstances that impact the Board’s exercise of discretion, including the merits. 

Id. at 6.  The PTAB explained that these factors “relate to whether efficiency, fairness, and the merits support the exercise of authority to deny institution in view of an earlier trial date in the parallel proceeding.” Id.  The PTAB further explained that because there is some overlap among the factors and some facts may be relevant to multiple factors, it “takes a holistic view of whether efficiency and integrity of the system are best served by denying or instituting review.” Id.  The PTAB went on to provide some guidance for parties to address each factor and some insight into how the PTAB evaluates each factor. Id. at 6-16.