Pending Reexamination Causes Denial of IPR Petition Under § 325(d)

In Fox Factory, Inc. v. SRAM, LLC, the Patent Trial and Appeal Board (PTAB) exercised its discretion to deny institution of a petition for inter partes review (IPR). IPR2017-01439, Paper 7 (PTAB Dec. 8, 2017). Under 35 U.S.C. § 325(d), the PTAB has the discretion to deny institution if “the same or substantially the same prior art or arguments previously were presented to the Office.” In Fox Factory, the panel determined that the ground of challenge presented in the IPR petition was “nearly identical” to a ground currently under consideration in a parallel reexamination. The fact that the reexamination was still pending and that no final determination had been rendered did not deter the PTAB from denying institution.

Although the ground presented in the IPR relied on a new primary reference that was not under consideration in the parallel reexamination, the PTAB panel determined that the new reference does not “meaningfully alter[] the substance of the ground of unpatentability.” Id. at 8, n. 2. The panel also noted that reexamination was ordered and had been ongoing for almost a year. The panel found that one of the references cited in the IPR challenge was previously considered in an earlier, separate reexamination proceeding which had concluded.

Further, the panel noted that the petitioner “did not allege that the Examiner in the reexamination has misapprehended or overlooked any . . . aspect of the prior art relied on in the IPR.” Id. at 8. The panel stated that “[g]iven the lack of any specific reason why we should redo the work already done by the Examiner in the ’831 Reexamination, we are unpersuaded that Petitioner has articulated sufficiently an interest in correcting errors.” Id. at 9. The petitioner’s failure to provide a specific reason justifying a second look at the prior art and argumentation weighed heavily into the panel’s decision.

In light of the above, the panel concluded that it would be an inefficient use of the Patent Office’s resources to institute review of the IPR and denied institution:

Although the reexamination is not yet complete, instituting a trial here would have us reconsider the same issues with the same references that the Examiner has already been considering . . . . The similarity of the grounds in this proceeding and the ’831 Reexamination, coupled with the fact that JP-Shimano has already been considered in the ’744 Reexamination, indicates that it would be an inefficient use the Office’s resources to consider essentially the same ground again. Thus, we consider the interests of conservation of resources and finality to weigh strongly in favor of exercising our discretion of not instituting this ground.

Id. at 8.

As discussed in our previous article, the PTAB has taken a flexible and inclusive approach in determining whether previous consideration of prior art or argumentation warrants denial under § 325(d). As Fox Factory demonstrates, even ongoing proceedings at the Patent Office may serve as the basis for denial. In cases where § 325(d) may be at issue, petitioners should consider explaining why the prior art or argumentation presented in the petition is not the same or substantially the same as that which was previously presented to the Patent Office. When appropriate, petitioners should consider providing an explanation as to how the prior art or argumentation was previously misapprehended or overlooked by the Patent Office.

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