Patent Owner, not Petitioner, Bears the Burden to Prove that IPR Estoppel Applies

In Ironburg Inventions Ltd., v. Valve Corp., No. 2021-2296 (Fed. Cir. April 3, 2023), the Federal Circuit affirmed the district court’s finding of willful infringement, claim construction, and denial of enhanced damages, but vacated and remanded the finding of estoppel.

Ironburg accused Valve’s Steam Controller of infringing U.S. Patent No. 8,641,525, which is directed to a handheld controller for a video game console. Valve also filed an IPR petition, which was partially instituted. Before trial, the district court held that Valve is estopped from asserting the grounds that were not instituted or not asserted. The jury found willful infringement, and the district court denied Valve’s motions for judgment as a matter of law (JMOL) or a new trial, and also denied Ironburg’s motion for enhanced damages. The parties appealed.

On appeal, the Federal Circuit agreed with the district court that the challenged claims are not indefinite because the patent provides sufficient guidance for a POSITA as to the scope of the claims. The Federal Circuit also held that the jury had substantial evidence to conclude that the Steam Controllers infringe. The Federal Circuit also affirmed the denial of Valve’s JMOL on willful infringement or a new trial because Valve received a pre-suit notice but did not attempt to design around. The Federal Circuit vacated and remanded the district court’s finding of estoppel with respect to the invalidity grounds discovered later through a third-party IPR petition, holding that the district court improperly placed the burden of proof on Valve to show that it could not reasonably have raised the non-petitioned grounds in its petition when, instead, the burden should have been placed on Ironburg. Lastly, the district court properly rejected enhanced damages because there was no evidence of copying.