NHK-Fintiv: As PTAB Denials Mount, Petitioners Seek a Remedy

The Patent Trial and Appeal Board’s (PTAB) NHK-Fintiv rule emerged from the 2018 ruling in NHK Spring v. Intri-Plex, which held that the existence of a parallel district court lawsuit should preclude an inter partes review. The 2020 Apple v. Fintiv ruling then outlined six factors for the PTAB to consider before instituting a review, including the trial date in the parallel case, whether the court has stalled its case for the PTAB review, and any overlap between the issues in both proceedings. However, a recent ruling in SK hynix v. Netlist bypassed the NHK-Fintiv rule, and semiconductor company SK hynix persuaded the PTAB to review a memory module patent held by Netlist, even though the parallel infringement suit is set for trial on July 6, 2021. World Intellectual Property Review interviewed Finnegan attorney Kara Specht to discuss the PTAB’s decision to institute the patent review.

Kara said:

“Like in the recently designated precedential opinion Sotera Wireless v Masimo (2020), SK hynix offered a broad stipulation that, if instituted, it would not assert any grounds that could reasonably have been raised in its petition before the district court. The SK hynix decision highlights the importance of petitioners seeking institution to prepare petitions diligently and eliminate overlap with invalidity positions raised before the district court. The SK hynix decision does not appear to be an exception to the NHK-Fintiv rule. In granting institution, the board focused heavily on petitioner’s diligence, filing the petition as early as reasonably possible, and petitioner’s stipulation to remove overlap with the district court.”

As for the impact this may have on policy and petitioners who wish to challenge patents in the future, she said:

“There are several factors in play right now that possibly have an impact on policy going forward. The USPTO is currently under the leadership of an interim acting director, and the next director could push for policies that change the NHK-Fintiv landscape. Several companies have also filed suit against the USPTO challenging the NHK-Fintiv rule. Either of these could result in changes. At a strategic level, we have seen petitioners pushing to file their petitions much more quickly or accept estoppel at the institution stage. We have also seen patent owners filing litigations with forums that set a fast pace and pursuing quick case schedules. These trends are likely to continue until there is a significant policy change.”

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