Collateral Estoppel at the Federal Circuit for Inter Partes Review Proceedings

In Maxlinear, Inc. v. CF CRESPE, LLC, slip op. 2017-1039, the Federal Circuit remanded to the Patent Trial and Appeal Board (“Board”) an inter partes review (“IPR”) proceeding to evaluate the patentability of certain dependent claims, where the unpatentability of their respective independent claims had been previously affirmed by the Federal Circuit.  The fact pattern leading to this result is particularly informative.

The IPR that was the subject of the Maxlinear appeal is IPR2017-00592 (“the ‘592 IPR”), in which the Board upheld patentability of claims 1-4, 6-9, and 16-21 of U.S. Patent No. 7,075,585 (“the ‘585 patent”). Id. at 2.  Appellant Maxlinear, Inc. (“Maxlinear”) only sought review of the Board’s decision as to dependent claims 4, 6-9, and 20-21. Id.  

The ‘585 patent was also the subject of two other IPRs filed by a different Petitioner using different prior art – IPR2015-00728 (“the ‘728 IPR”) and IPR2015-00615 (“the ‘615 IPR”). Id. at 4.  In the ‘728 IPR, the Board found claims 1-3, 5, 10, and 16-19 were unpatentable, which was subsequently affirmed by the Federal Circuit while the Maxlinear appeal was pending. Id. at 4.  In the ‘615 IPR, the Board found unpatentable claim 20, which was also subsequently affirmed by the Federal Circuit. Id.  Thus, the findings of patentability were different in the earlier IPRs – the ‘728 and ‘615 – compared to the later ‘592 IPR that was the subject of the Maxlinear appeal. The Patent Owner in all these IPRs was the same.[1]

Turning to the Board’s decision in the ‘592 IPR, as stated above, the Board upheld the patentability of claims 1-4, 6-9, and 16-21. Id. at 2.  Significantly, the Board based its decision solely on analysis of independent claims 1 and 17, from which the other claims depended. Id. at 3.  The Board’s decision did not mention any separate arguments with respect to the dependent claims and specifically held “‘[p]etitioner has not shown . . . independent claims 1 and 17 are unpatentable.  Because each of challenged claims 2-4, 6-9, 16, and 18-21 incorporate the limitations of the respective independent claims, we also conclude that [p]etitioner has not shown, by a preponderance of the evidence, that those claims are unpatentable.’” Id. at 3 (citing Final Written Decision).  Here is where the earlier affirmed IPR decisions become relevant.

Claims 1, 17, and 20 were all held unpatentable at the PTAB level in the previous IPRs, and those decisions were subsequently affirmed by the Federal Circuit. Id. at 4-5.  As such, the Federal Circuit held, and the parties did not dispute, that those prior decisions are binding in the Maxlinear appeal as a matter of collateral estoppel (also known as issue preclusion). Id. at 5.  The Federal Circuit noted that the fact that the ‘728 IPR became final during the pendency of the Maxlinear appeal was not relevant as “’issue preclusion applies even though the precluding judgment . . . comes into existence while the case as to which preclusion is sought (this case) is on appeal.’” Id. at 6 (internal citations omitted).

The Federal Circuit also found irrelevant the fact that Maxlinear was not a party to the earlier IPRs, since Cresta, the predecessor in interest to CRESPE, was a party to the other IPRs and determinations by the Federal Circuit. Id. at 6.  Thus, of appealed claims 4, 6-9, and 20-21, the only remaining question was the patentability of claims 4, 6-9, and 21, which were not addressed in the earlier IPRs. Id.

Because the Board’s decision in the ‘592 IPR rested solely on evaluation of independent claims 1 and 17, the affirmed finding of unpatentability of those claims in the ‘728 IPR abrogated the Board’s decision. Id.  at 7.  In view of the basis of the ‘592 IPR final written decision that did not address dependent claims 4, 6-9, and 21, the Federal Circuit remanded to the Board for further consideration of those claims. Id.  In doing so, the Federal Circuit noted that “the collateral-estoppel effect of an administrative decision of unpatentability generally requires the invalidation of related claims that present identical issues of patentability.” Id.  However, the opinion also noted that the Federal Circuit has previously pointed out that “’precedent does not limit collateral estoppel to patent claims that are identical . . . . If the differences between the unadjudicated patent claims and adjudicated patent claims do not materially alter the question of invalidity, collateral estoppel applies.’” (internal citations omitted).

Thus, the Federal Circuit’s specific instructions to the PTAB were:

On remand, the Board must consider whether the dependent claims 4, 6-9, and 21 can survive the unpatentability of claims 1 and 17 from which they depend in view of the prior art cited in the ’728 IPR.   The Board must decide whether the remaining claims present materially different issues that alter the question of patentability, making them patentably distinct from claims 1 and 17.

Remand of these claims will allow the Board to evaluate CRESPE’s argument concerning the surviving claims and allow the Board to consider the dependent claims in light of the unpatentability of claims 1 and 17.

The take away from this Maxlinear decision is that patent owners and petitioners should be mindful of any collateral estoppel affect an affirmed decision of the Federal Circuit may have on other inter partes review proceedings involving the same patent.  Practitioners interested in following the remand of this case to the Board should consider the Board’s recently published Standard Operating Procedure Number 9 that relates to the “Procedure for Decisions Remanded from the Federal Circuit for Further Proceedings.”

^[1] CF CRESPE LLC (“CRESPE”) is the successor in interest to Cresta Technology Corporation (“Cresta”), which originally owned the ‘585 patent. Id. at FN1.