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Valve Corp. v. Elec. Scripting Prods., Inc., IPR2019-00062, -00063, -00084, Paper No. 8, Patent No. 9,235,934 B2

[When a second petition for IPR from the same or similar party will be denied under § 314(a)]

FACTS

Valve filed three petitions for IPR against a patent owned by Electric Scripting Products, Inc. (“Patent Owner”). HTC had previously filed a petition requesting an IPR against the same patent, and their petition was denied. Valve and HTC were co-defendants in a lawsuit brought by Patent Owner but after Valve filed a motion challenging venue, it was dismissed without prejudice. Patent Owner argues that the petition should be dismissed using the board’s discretion under § 314(a) because it is an “unfair” follow-on petition.

HOLDING

The petition is denied under § 314(a) as it challenges the same patent as a previous petition and every one of the 7 factors from General Plastic favors denial.

The factors specified in General Plastic are: “(1) whether the same petitioner previously filed a petition directed to the same claims of the same patent; (2) whether at the time of filing of the first petition the petitioner knew of the prior art asserted in the second petition or should have known of it; (3) whether at the time of filing of the second petition the petitioner already received the patent owner’s preliminary response to the first petition or received the Board’s decision on whether to institute review in the first petition; (4) the length of time that elapsed between the time the petitioner learned of the prior art asserted in the second petition and the filing of the second petition; (5) whether the petitioner provides adequate explanation for the time elapsed between the filings of multiple petitions directed to the same claims of the same patent; (6) the finite resources of the Board; and (7) the requirement under 35 U.S.C. § 316(a)(11) to issue a final determination not later than 1 year after the date on which the Director notices institution of review.” Gen. Plastic Indus. Co. v. Cannon Kabushiki Kaisha, IPR2016-01357, at 15-16 (P.T.A.B. Sept. 6, 2017).

General Plastic Factor (1) does not only apply if petitioners are the same, but it also when there is a close relationship between the petitioners. Due to HTC and Valve having been co-defendants in a lawsuit filed by the petitioner, the first factor favors denial. Factor (2) favors denial because even if Valve did not know of the prior art in the HTC petition when that petition was filed, its quick turn-around in filing this petition suggests that they could have easily found the prior art. Factor (3) also favors denial because Valve had access to the board’s decision to deny institution of the first petition and could strategically use that information to bolster their petition. Factors (4) and (5) look at the time that elapsed between the time Both factors favor denial because there is no reason for the 5-month delay between HTC and Valve’s petitions. Factors (6) and (7) evaluate the efficiency of permitting the second petition to be granted. In this case, because the two petitions were not filed at the same time, the factors favor denial.

TAKEAWAY

The PTAB will apply a the 7 factor test from General Plastic in order to determine whether to dismiss a second petition from the same party (or another closely related party) under the discretion given in § 314(a).

A copy of the actual decision can be found here.