On July 8th, in Fitbit, Inc. v. Valencell, Inc., the Federal Circuit appeared to telegraph that it will vacate its decision in Facebook, Inc. v. Windy City Innovations, LLC.
Will the PTAB follow its former precedent if it is reinstated?
As a reminder, Windy City held that 315(c) was unambiguous that an existing "party" to a proceeding cannot be joined as a party. And, despite the precedential decision of the PTAB, given the clear language of the statute, there was no reason to even consider the earlier precedent for purposes of according any Chevron or Skidmore deference. (then the court volunteered that they wouldn't defer to such decisions anyway)
In Fitbit ( here), Apple filed an IPR petition challenging claims 1-13 of a Valencell paten, and the Board instituted review of claims 1, 2, and 6-13. After institution, Fitbit filed a copycat petition and moved to join the Apple IPR. The Board granted Fitbit's petition and motion for joinder.
Before the Board issued a Final Written Decision, the Supreme Court decided SAS Institute, Inc. v. Iancu. Consistent with the Supreme Court's holding that all claims challenged in an instituted petition must be reviewed, the Board conducted further proceedings as to claims 3-5, and issued a Final Written Decision finding claims 1, 2, and 6-13 unpatentable and claims 3-5 not unpatentable. Apple subsequently withdrew from the proceeding, but Fitbit appealed the Board's decision on claims 3-5. Valencell challenged Fitbit's right to appeal, arguing that Fitbit was not a "party" because its original petition only challenged claims 1, 2, and 6-13.
The Federal Circuit rejected Valencell's arguments and agreed with Fitbit's response that it was a party with a right to appeal under § 319, in part because "after its joinder with Apple's IPR there was only one IPR." The Court concluded that "Fitbit's rights as a joined party applies to the entirety of the proceedings and includes the right of appeal." Notably, however,the Court relied upon the Supreme Court's recent decision in Thryv, Inc. v. Click-to-Call Technologies, LP to reject one of Valencell's arguments:
Valencell also states that Fitbit's petition was not in conformity to statute, for Fitbit's petition and the accompanying request for joinder were filed more than one year after the filing of Valencell's district court suit against Fitbit. Appellate review of this aspect was resolved by the recent decision in Thryv, Inc. v. Click-to-Call Technologies, LP, 140 S. Ct. 1367 (2020), where the Court held, as to a tardy filing of a petition for IPR, that the Board's acceptance of such filing at the "institution" phase is, by statute, not reviewable on appeal.
This interpretation of Thryv will likely lead to vacatur of the Federal Circuit's Windy City decision. That is, it now seems likely that the Director's decision to institute and join parties is not subject to review because § 315(c), like § 315(b), seems to be "closely related to [the Director's] decision whether to institute inter partes review and is therefore rendered nonappealable by § 314(d)." Thryv, Inc., slip op. at 2.
The Windy City parties filed additional briefing on Thryv last month, so a decision is expected soon. If the Court should vacate its earlier decision, the agency would be free to follow its now reinstated earlier precedent. That said, I would not expect the agency to openly disregard the Windy City analysis and revert to its former practices.
Originally published 10 July, 2020
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