PATENT CASE OF THE WEEK 

VirnetX Inc. v. Apple, Inc., Appeal Nos. 2017-2490, -2494 (Fed. Cir. Dec. 10, 2018)

The Federal Circuit affirmed two final written decisions of the Patent Trial and Appeal Board (“PTAB”), which had found claims of one of VirnetX’s patents unpatentable as obvious.  The Court found that VirnetX was collaterally estopped from relitigating a threshold issue of whether prior art reference “RFC 2401” was a “printed publication” under § 102(b), and that it had failed to preserve the only remaining issue raised in the appeal.

During the pendency of the instant appeals, the Federal Circuit had decided VirnetX Inc. v. Apple, Inc., 715 F. App’x 1024 (Fed. Cir. Mar. 16, 2018) (“VirnetX I”), in which the Court affirmed seven PTAB decisions finding that claims of another VirnetX patent were rendered obvious by RFC 2401, in combination with other references.  In that case, VirnetX had also argued RFC 2401 was not a printed publication.  The PTAB disagreed, and the Federal Circuit summarily affirmed under Federal Circuit Rule 36.

The Court recited that collateral estoppel occurs when “(1) a prior action presents an identical issue; (2) the prior action actually litigated and adjudged that issue; (3) the judgment in that prior action necessarily required determination of the identical issue; and (4) the prior action featured full representation of the estopped party,” and confirmed that summary affirmations under Rule 36 may have collateral estoppel effects.  Here, the parties disputed only whether the printed publication status of RFC 2401 was essential or necessary to the VirnetX I judgment.  The Court found that it was, noting that each ground of unpatentability appealed had relied on RFC 2401, with its printed publication status being the only issue raised for three of the seven PTAB decisions appealed.

VirnetX also argued that patents filed before the enactment of the America Invents Act (“AIA”) could not be subject to its inter partes provisions, but the Court found that VirnetX had failed to preserve the argument.  In its opening brief in the instant appeals, VirnetX had included a short paragraph asking the Court to set aside the PTAB decisions if the U.S. Supreme Court should find, in its then-pending decision in Oil States Energy Services, LLC v. Greene’s Energy Group, that inter partes review proceedings were unconstitutional.  The Federal Circuit found that this generic challenge “in no way provides any arguments specifically preserving the retroactivity issue,” and that its collateral estoppel determination was therefore dispositive of all issues on appeal.

The opinion can be found here.

ALSO THIS WEEK 

Spineology, Inc. v. Wright Medical Technology Inc., Appeal No. 2018-1276 (Fed. Cir. Dec. 14, 2018)

In an appeal from a district court denial of attorneys’ fees under 35 U.S.C. § 285, the Federal Circuit affirmed.  The District Court had rejected Wright’s arguments that Spineology’s claim construction position, damage theories and litigation conduct made the case exceptional under § 285.  The Court found that the District Court did not abuse its discretion and thus affirmed.  The Court also reiterated that “fee awards are not to be used ‘as a penalty for failure to win a patent infringement suit.’”

The opinion can be found here.