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Patent Office Trials

Trover Group and Security Center sued Finnegan client Axis Communications in the Eastern District of Texas (EDTX), alleging infringement of patents related to video surveillance systems. Axis, a leading network camera manufacturer based in Sweden, turned to Finnegan for its defense in the litigation. In addition to preparing and filing an inter partes review (IPR) petition with the U.S. Patent and Trademark Office (USPTO) to seek invalidation of the asserted claims, the Finnegan team advanced critical claim constructions previously overlooked by some of the prior defendants. After a successful Markman hearing and ruling on claim construction, letter briefs were filed to request summary judgment briefing. The requests were subsequently granted by the court and, shortly thereafter, a favorable settlement and dismissal of the action was obtained for Axis.
Finnegan client FedEx was accused of patent infringement in two separate litigations in the Northern District of California, where IpVenture asserted two related patents directed to processes used in connection with tracking packages with the aid of a device called “SenseAware,” which enables users to track the location and certain conditions of related packages. On behalf of FedEx, Finnegan filed an inter partes reexamination on one patent, and an inter partes review (IPR) on the other at the U.S. Patent and Trademark Office (USPTO). The USPTO granted both petitions, and the Patent Trial and Appeal Board (PTAB) affirmed the rejection of all claims of the reexamined patent and invalidated all claims of the second patent during the IPR. The district court cases were stayed during the USPTO proceedings and during IpVenture’s appeal to the Federal Circuit, which affirmed both of the PTAB’s decisions.
In two related appeals from inter partes review (IPR) proceedings, Finnegan successfully persuaded the U.S. Court of Appeals for the Federal Circuit to vacate and remand the Patent Trial and Appeal Board’s (PTAB) decisions that adversely affected three patents related to coaxial cable connectors owned by client PPC Broadband. In the first appeal, for a majority of the claims, the Federal Circuit agreed with PPC that the PTAB overlooked a key claim limitation, and it therefore vacated and remanded the obviousness decision. For the remainder of the claims in that appeal, the court affirmed the claim construction ruling as the broadest reasonable interpretation, but noted that it would not be the “correct” construction had the Phillips standard applied. Finally, the court also agreed with PPC that the PTAB erred in disregarding much of the evidence on secondary considerations, including the commercial success of the accused products. In the second appeal, the court likewise agreed with PPC and vacated the PTAB’s claim construction as being unreasonable, stating that while the construction may have been the broadest interpretation, it was not the broadest reasonable interpretation in light of the specification. The Federal Circuit thus vacated and remanded the invalidity determinations in both appeals.
Finnegan successfully represented Capsugel Belgium in one of the first completed inter partes review (IPR) proceedings at the U.S. Patent and Trademark Office (USPTO).  Capsugel challenged all 26 issued claims of a patent owned by Innercap Technologies, and an adverse judgment was entered by the Patent Trial and Appeal Board (PTAB) cancelling all of the claims instituted as part of the post-grant challenge. The patent was directed to a pharmaceutical capsule.
Finnegan client Fidelity National Information Services Inc. (FIS) successfully challenged four banking patents owned by its rival financial-services-technology provider Fiserv Inc. FIS petitioned the Patent Trial and Appeal Board (PTAB) for covered business method patent review (CBM). The PTAB said the four patents—directed to processing payment instructions, providing electronic biller notifications, and processing interbank fund-transfer transactions—cover abstract ideas that, in light of the Supreme Court’s decision on patentability in Alice Corp. v. CLS Bank International, are too abstract to be patentable. The PTAB decisions stem from a suit filed in January 2012, in which Fiserv subsidiaries CheckFree Corp. and CashEdge Inc. accused FIS and its subsidiary Metavante Corp. of infringing the patents. Following a Markman hearing, the court stayed the litigation while the PTAB reviewed the Fiserv patents. 
In response to litigations brought by CreateAds for a computerized “visual design” solutions patent, Google and Yahoo! asked Finnegan to file an inter partes review (IPR) petition to challenge the claims of the asserted patent. The petition addressed all 20 claims of the patent, based on seven different grounds of prior art, and included a declaration from the author of a prior art Master’s Thesis Paper deposited in the MIT library. The IPR was coordinated with the underlying CreateAds consolidated litigations, in which Finnegan also played a significant role in briefing a summary judgment motion to dispose of the patent under 35 U.S.C. 101. After limited discovery and twice rejecting CreateAds’ claim construction proposals, the Patent Trial and Appeal Board (PTAB) issued a final written decision finding all 20 claims unpatentable in view of the prior art and maintaining all seven instituted grounds advanced by the Finnegan team.
Finnegan client iFly Holdings LLC (iFly) served Indoor Skydiving Germany GMBH (ISG) with a complaint in the Eastern District of Texas, alleging infringement of its patent directed to vertical wind tunnels used for simulated skydiving. ISG then petitioned the Patent Trial and Appeal Board (PTAB) to institute an inter partes review (IPR) of iFly’s patent claims as anticipated and obvious in view of several references. Finnegan secured a total non-institution win for iFly through arguments raised in its patent owner’s preliminary response, including that ISG failed to demonstrate the references it cited against iFly’s patent were prior art printed publications, that other prior art did not teach or suggest claim features relating to the staging area of the vertical wind tunnel, and that ISG did not provide adequate reasoning to support its obviousness grounds. The PTAB denied institution on all grounds, concluding that the petition failed to show a reasonable likelihood of success that any challenged claim was unpatentable.
Finnegan client Health Diagnostic Laboratory, Inc. (HDL) served Boston Health Diagnostics Corporation with a complaint in the Eastern District of Virginia, alleging infringement of its patent directed to methods of predicting the risk of developing diabetes based on a model HDL developed using unique biomarker combinations. Boston Heart immediately petitioned the Patent Trial and Appeal Board (PTAB) to institute an inter partes review (IPR) challenging HDL’s asserted claims as anticipated and obvious in view of several prior art references. Finnegan secured a non-institution decision for HDL through arguments raised in its patent owner’s preliminary response that Boston Heart failed to demonstrate the prior art taught the diagnostic model using the claimed biomarker panels. The PTAB denied institution on all grounds, concluding that the petition failed to adequately explain how the cited references disclose the model as claimed.
Finnegan client Fidelity National Information Services Inc. (FIS) challenged two check-imaging patents owned by DataTreasury in covered business method (CBM) reviews at the Patent Trial and Appeal Board (PTAB), and successfully defended the PTAB’s decisions invalidating those patents on appeal to the Federal Circuit. DataTreasury’s infamous “Ballard” patents were called out by name as troublesome business method patents by Congress when it wrote the CBM statute. The PTAB, in its final written decision (FWD), said the two patents—directed to transferring information from one location to another where the transferred information is unreadable without a secret decoder key—cover abstract ideas that, in light of the Supreme Court’s decision on patentability in Alice Corp. v. CLS Bank Int’l, are too abstract to be patentable. The PTAB also held that many of the claims lacked sufficient written description for encrypting subsystem identification information and thus fail to meet the rigors of 35 U.S.C. § 112. The Federal Circuit affirmed the PTAB’s decision with a Rule 36 judgment, which the Supreme Court declined to review on certiorari. Finnegan represented FIS in the CBM challenges, in DataTreasury’s appeal of those CBM challenges, and also in mandamus petitions to the U.S. Court of Appeals for the Federal Circuit, resulting in a successful stay of the underlying litigation in the Eastern District of Texas.

Apple filed seven inter partes review (IPR) petitions challenging several patents owned by Finnegan client VirnetX more than a year after it was served with a complaint alleging infringement of the patents. Finnegan secured non-institution decisions for VirnetX through arguments in its patent owner’s preliminary responses to the Patent Trial and Appeal Board (PTAB) that Apple was time-barred under 35 U.S.C. 315(b) from requesting IPR of the challenged patents. 

Finnegan client VirnetX served Microsoft with a complaint alleging infringement of the challenged patents more than a year before Microsoft filed its three inter partes review (IPR) petitions.  However, the litigation was settled and dismissed after trial but before a final decision.  Microsoft argued that its petitions were not barred because its counterclaims and affirmative defenses regarding invalidity in the litigation were dismissed “without prejudice.”  In its preliminary responses, VirnetX argued that the manner in which counterclaims and affirmative defenses are dismissed is irrelevant for 35 U.S.C. 315(b)’s time bar—it is the infringement allegations that matter.  Agreeing with VirnetX, the Patent Trial and Appeal Board (PTAB) denied institution, in part, because the infringement allegations in the complaint were dismissed “with prejudice” and the parties were in different relative legal positions than before the complaint was filed.
Finnegan filed on behalf of client Borealis AG, two inter partes review (IPR) petitions supported by extensive expert declarations challenging a patent held by Berry Plastics Corp. The patent is directed to polypropylene formulations and products, which are often used for insulated foam drinking cups. Rather than responding to the grounds raised, Berry Plastics filed statutory disclaimers to cancel all 64 claims challenged by the IPRs.
Apple filed two inter partes review (IPR) petitions challenging one patent owned by Finnegan client VirnetX, seeking to join its petitions to petitions filed by another petitioner challenging another VirnetX patent.  Based on Finnegan’s arguments in the preliminary responses, the Patent Trial and Appeal Board (PTAB) denied the motions for joinder and denied institution on the basis that the petitions were time-barred under 35 U.S.C. 315(b).
Loramax filed patent infringement suits in the Eastern District of Texas against fifty companies, claiming that virtually any company email distribution service infringed an expired patent Loramax obtained. After Finnegan pressed an invalidity defense, which included an inter partes review (IPR), and filed motions to dismiss asserting invalidity under Section 101, Loramax voluntarily dismissed its claims against FedEx.
One year after accusing longstanding Finnegan client FedEx of patent infringement in the Eastern District of Texas, non-practicing entity Catharon IP dismissed its claims against FedEx with prejudice. Catharon IP claimed that its patent covered a common use of Javascript in today’s websites. The dismissal came after Finnegan attorneys filed two IPRs challenging the validity of Catharon’s patent.
Zoll Lifecor filed eight petitions for inter partes review, challenging eight patents owned by Finnegan client Philips.  Following preliminary responses filed by Philips, the Patent Trial and Appeal Board (PTAB) denied institution because Zoll Lifecor failed to identify its parent company Zoll Medical, who was in litigation with Philips, as a real party in interest. Zoll Lifecor then appealed the PTAB’s decisions to the Federal Circuit and all eight appeals were dismissed on Philips’s motion for lack of jurisdiction.
A group of hedge funds managed by Kyle Bass filed inter partes review (IPR) petitions challenging two patents covering the multiple sclerosis drug Tecfidera®, held by Finnegan client Biogen MA. Finnegan filed preliminary responses on behalf of Biogen, arguing that the petitions failed to demonstrate that the prior art rendered the claimed inventions obvious, and secured non-institution decisions in both proceedings. The Patent Trial and Appeal Board (PTAB) denied institution on all grounds, concluding that both petitions failed to establish a reasonable likelihood that any of the challenged claims were unpatentable. The PTAB also denied the petitioner’s request for rehearing, which was filed in one of the proceedings.
Several patents owned by Finnegan client VirnetX were challenged through seven inter partes review (IPR) petitions filed by RPX.  The facts suggested that RPX had been acting on behalf of another, unnamed time-barred entity.  In the window between the filing of the petitions and the due date for its preliminary responses, VirnetX sought discovery on the relationship between RPX and the other entity.  The Patent Trial and Appeal Board (PTAB) authorized VirnetX to file a motion for additional discovery and granted the motion—one of the few instances where the PTAB authorized, let alone granted, a motion for additional discovery.  Leveraging the discovery in its preliminary responses, VirnetX secured non-institution decisions from the Board, which found that the petitioner was acting as proxy for the time-barred entity—the true real party-in-interest.
Finnegan successfully represented Sensio, Inc. in IPR proceedings involving three design patents directed to triple slow-cooker designs.  Sensio established that the claimed designs were in the prior art and countered the patent owner's attempt to antedate the prior art references.  After an oral argument, the Patent Trial and Appeal Board (PTAB) found all three patents to be anticipated and obvious in view of prior designs.  Finnegan also represented Sensio in the co-pending district court litigation in Kansas, which Finnegan successfully argued should be stayed during the pendency of the IPR proceedings.
Rackspace Hosting, Inc. asked Finnegan to challenge all claims in Clouding, Inc.’s data synchronization patent.  Less than one month later, Finnegan filed a petition for inter partes review on Rackspace’s behalf, supported by a newly identified expert and challenging the claims with newly identified prior art.  The inter partes review was instituted, and following an oral hearing, the Patent Trial and Appeal Board (PTAB) held all claims unpatentable.  In doing so, the PTAB found all claims anticipated by prior art, many by multiple references.
Finnegan successfully represented Neste Oil Oyj as petitioner in an IPR proceeding against patent owner REG Synthetic Fuels, LLC. Neste established that prior art anticipated the claimed phase-change material composition and countered REG’s attempt to antedate the prior art. The Board also denied REG’s motion to amend, agreeing with Neste that the proposed substitute claims were impermissibly broader than the original claims. In addition, the Board excluded a number of documents offered by REG to corroborate its inventor’s testimony, holding that the documents lacked authentication or were hearsay. All challenged claims were held unpatentable.

Finnegan client SAP received a favorable ruling in the first Patent Trial and Appeals Board (PTAB) decision in a post-grant review of a covered business method patent, a proceeding established as part of the America Invents Act.  The Board found all of the challenged claims of a patent owned by Versata Software unpatentable under section 101 of the Patent Act.  The ruling came just nine months after Finnegan filed the petition on September 16, 2012, the first day the new procedure took effect.

Finnegan client Covidien challenged all claims in a patent directed to a surgical stapler owned by Ethicon Endo-Surgery in an inter partes review petition.  The inter partes review was instituted, and following an oral hearing, the Patent Trial and Appeal Board (PTAB) found the claims to be unpatentable.
The U.S. Court of Appeals for the Federal Circuit found in favor of Finnegan client Unified Patents Inc., in Unified’s first case before the court. After Unified prevailed in an inter partes review (IPR) before the Patent Trial and Appeal Board (PTAB), the patent owner, Clouding Corp., appealed the Board’s decision that Clouding’s claims relating to file synchronization and backup were unpatentable. Clouding also appealed the Board’s denial of its motion to amend. Less than two weeks after oral argument, the Federal Circuit summarily affirmed the PTAB’s final written decision in favor of Unified.
Finnegan client CRS Advanced Technologies achieved a complete win in the second decision related to covered business method (CBM) patents issued by the Patent Trial and Appeal Board (PTAB) at the U.S. Patent and Trademark Office (USPTO). The Board cancelled every claim that had been pending in a related district court infringement litigation. In the CBM, Finnegan challenged the patent as not meeting the requirements of 35 U.S.C. § 101 and presented arguments in favor of claim cancellation, in what was the second such CBM hearing before the PTAB. The decision capped a decade of litigation for CRS. Frontline Technologies, Inc. initially sued CRS for patent infringement on one patent, which ultimately settled with CRS taking a patent license that Finnegan had negotiated with Frontline. Frontline later terminated the license and sued CRS a second time. The district court subsequently stayed the case pending a reexamination proceeding instituted by the USPTO on a petition filed by Finnegan on CRS's behalf, from which the patent emerged, heavily amended, two years later. Meanwhile, another Frontline patent issued and was asserted against CRS but, after a third party requested reexamination of that patent, Frontline granted CRS a covenant against suit and dropped that second patent from the litigation. The case continued for three more years on the reexamined patent, allowing Finnegan to file a CBM petition on the first day that procedure became available. The PTAB granted the petition, and a month later the district court again stayed the case, which was then in the final stages of pre-trial submissions. The Board agreed with CRS that the claims were unpatentable, and the related district court proceeding has since been dismissed with prejudice with the consent of the parties.
After Harmonix was sued by Princeton Digital Image Corp. in D. Delaware, Finnegan filed a request for inter partes review (IPR) on behalf of Harmonix against all asserted claims. Shortly after filing, Finnegan obtained a rare pre-institution stay of the litigation for Harmonix and other defendants sued over the same patent, avoiding potentially substantial discovery costs. The PTAB issued its final written decision finding four patent claims unpatentable on both proposed § 102 grounds.