Use of Infringement Disclaimer to Preserve Favorable PTAB Decision

BakerHostetler
Contact

BakerHostetler

In a recent precedential opinion, ABS Global Inc. v. Cytonome/ST, LLC, 984 F.3d 1017 (Fed. Cir. 2021), the Federal Circuit held that the disclaimer of a right to appeal a district court’s summary judgment of non-infringement mooted a petitioner’s appeal of the Patent Trial and Appeal Board’s (PTAB) final written decision in an inter partes review (IPR) proceeding.

In 2017, Cytonome sued ABS alleging infringement of Cytonome’s ‘161 Patent. Several months later, ABS filed a petition for inter partes review of all claims of the ‘161 Patent. After instituting review, the PTAB issued a final written decision invalidating some, but notably not all, claims of the ‘161 Patent. Thereafter, in the district court litigation, the court granted ABS’s motion for summary judgment of non-infringement of the ‘161 Patent. About two months later, ABS appealed the PTAB’s final written decision and filed its opening brief in support thereof. Next, Cytonome filed a response brief, which included an affidavit from Cytonome’s counsel that Cytonome “has elected not to pursue an appeal of the district court’s finding of non-infringement as to the ‘161 patent and hereby disclaims such an appeal.” The issue before the Federal Circuit, as raised by Cytonome in its response brief, was whether its disclaimer of its right to appeal the district court’s summary judgment non-infringement ruling mooted ABS’s appeal of the PTAB’s final written decision.

Applying the voluntary cessation doctrine, the Federal Circuit considered (a) whether Cytonome had demonstrated that its challenged conduct was not reasonably expected to recur in view of its infringement disclaimer, and, if so, (b) whether ABS had demonstrated that it was engaged in or had sufficiently concrete plans to engage in activities not covered by Cytonome’s infringement disclaimer.

With respect to Cytonome’s burden under (a), the Federal Circuit found Cytonome had demonstrated that it could not reasonably be expected to resume its enforcement efforts against ABS because the district court’s summary judgment of non-infringement removed ABS’s alleged injury in fact, and Cytonome’s disclaimer was “coextensive with the asserted injury in fact.”[1] In particular, the Federal Circuit found that Cytonome’s disclaimer effectively made final the district court’s summary judgment of non-infringement in view of the fact that Cytonome is barred from reasserting that ABS infringes the same claims again.[2] In short, the Federal Circuit found that Cytonome had demonstrated that it could not reasonably be expected to resume its enforcement efforts against ABS because Cytonome’s disclaimer estopped it from asserting infringement of the ‘161 Patent against ABS in connection with ABS’s accused products or any other ABS products that are “essentially the same.”[3]

Regarding ABS’s burden under (b), the Federal Circuit found that ABS had failed to demonstrate any evidence that it “engaged in or had concrete plans to engage in activities” outside the scope of Cytonome’s disclaimer.[4] In so finding, the court cited ABS’s admission that it was not facing any “specific threat” of liability with respect to the ‘161 Patent, rejecting ABS’s argument that Cytonome’s prior litigation history of suing ABS on another patent across multiple cases exposed ABS to continued infringement liability.[5] Specifically, the court noted that ABS’s general fear of infringement from Cytonome did not stem from Cytonome’s original assertion of the ‘161 Patent and that the chance that Cytonome’s behavior could “conceivably recur” did not rise to the requisite level of “reasonably be[ing] expected to recur” in view of ABS’s failure to show concrete plans for future activity that would create a substantial risk of future infringement liability.[6]

In light of this precedential Federal Circuit decision, parties to an IPR should remain cognizant of the fact that the patent owner effectively controls its own destiny and may unilaterally use an infringement disclaimer in a parallel district court action to moot a challenger’s appeal of an IPR final written decision. This ability could prove very useful for a patent owner seeking to preserve a favorable (or at least partially favorable) IPR final written decision, while the appellant/challenger may be able to avoid such a result by showing concrete plans to engage in activities outside the scope of the infringement disclaimer.

[1] ABS Glob., Inc. v. Cytonome/ST, LLC, 984 F.3d 1017, 1021–22 (Fed. Cir. 2021).

[2] Id. at 1022.

[3] Id.

[4] Id.

[5] Id. at 1023.

[6] Id. (emphasis original).

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© BakerHostetler | Attorney Advertising

Written by:

BakerHostetler
Contact
more
less

BakerHostetler on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide
- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.