Intellectual Ventures Management v. Xilinx (IPR2012-00018): A Patent Owner Must Show Why the RPI Disclosure Is Wrong

An inter partes review petition may be considered only if it identifies all real parties in interest (35 U.S.C. § 312(a)(2); 37 C.F.R. § 42.8(b)(1)). Intellectual Ventures Management, LLC v. Xilinx, Inc., IPR2012-00018, is one of the Board’s first decisions on what a patent owner must show to challenge that identification. The decision, entered January 24, 2013, was filed in four IPRs (IPR2012-00018, -00019, -00020 and -00023), each involving a different Xilinx patent.

Background

Intellectual Ventures Management (IVM) filed the four petitions and named itself as the only real party in interest. In each preliminary response, Xilinx argued that the petitions should be denied because IVM had not named all the real parties in interest.

Xilinx’s evidence was a certificate of interested entities filed in an unrelated Northern District of California case by six defendants, including IVM. That certificate, required by a local rule and Federal Rule of Civil Procedure 7.1, listed 63 entities said to have a financial or other interest in the subject matter or in a party. Xilinx suggested that those entities, and other similarly named defendants, should have been named.

What the Board decided

The Board was not persuaded.

1. The legal test. The Board pointed to the Trial Practice Guide, which identifies considerations such as whether a non-party exercises control over the petitioner’s participation in the proceeding, and whether a non-party is funding or directing it.
2. Different disclosure rules. Xilinx had not shown that the district court disclosure requirements were the same as, or similar to, the real-party-in-interest inquiry. Rule 7.1, for example, requires identifying parent corporations and public companies owning 10% or more of a party’s stock, and the local rule reaches anyone with a financial or other interest in the outcome. Neither asks who controls or funds a particular proceeding.
3. Different subject matter. The district court case involved different subject matter and issues from the four IPRs, and the list even included Xilinx itself.
4. Burden to come forward. IVM had disclosed its real party in interest. A patent owner challenging that disclosure must come forward with sufficient evidence that it is inadequate, and Xilinx had not shown a basis for treating even one of the 63 entities as a real party in interest. Sorting through the list without more would be speculation.

Why it matters

The real-party-in-interest requirement matters because it feeds into the one-year time bar and estoppel provisions of 35 U.S.C. § 315, which reach the petitioner’s real parties in interest and privies. A patent owner raising the issue needs evidence directed to control, funding or direction of the proceeding, or to the relationship between the non-party and the petition. Corporate affiliation or a general financial interest, without more, is a weak basis. See who is the real party in interest in an IPR or PGR and defining privy.

Later developments

The real-party-in-interest inquiry has become more flexible than the early decisions suggested. In Applications in Internet Time, LLC v. RPX Corp. (Fed. Cir. 2018), the Federal Circuit held that the Board must take a flexible approach that considers the non-party’s relationship to the petitioner and whether the non-party benefits from, and has a preexisting relationship with, the petitioner, rather than focusing narrowly on control. In Worlds Inc. v. Bungie, Inc. (Fed. Cir. 2018), the court held that the petitioner bears the ultimate burden of persuasion on real party in interest once the patent owner produces evidence putting its identification in question. And in Thryv, Inc. v. Click-to-Call Technologies, LP (2020), the Supreme Court held that the Board’s § 315(b) time-bar rulings at institution cannot be appealed. Readers should check current Board guidance on how real-party-in-interest disputes are handled.

Key takeaways

• A petition must name all real parties in interest under § 312(a)(2).
• A district court interested-entities certificate did not show that any listed entity controlled, funded or directed the IPRs.
• The patent owner had to come forward with evidence that the petitioner’s disclosure was inadequate.
• Later Federal Circuit decisions adopted a more flexible test and placed the ultimate burden on the petitioner.