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Tick Tock: Even a Dismissed Complaint Counts Toward Time Bar

The US Court of Appeals for the Federal Circuit vacated a final Patent Trial and Appeal Board (PTAB) decision in an inter partes review (IPR) that held all challenged claims of a patent unpatentable, finding that the petition was time barred because it was filed more than one year after the service of a complaint that was dismissed without prejudice. Bennett Regulator Guards, Inc. v. Atlanta Gas Light Co., Case Nos. 17-1555, -1626 (Fed. Cir. Sept. 28, 2018) (Stoll, J). 

Bennett served Atlanta Gas with a complaint alleging infringement of its patent on July 18, 2012. Atlanta Gas moved to dismiss the complaint, and the district court granted the motion and dismissed without prejudice. On February 27, 2015, Atlanta Gas filed a petition to institute an IPR against the patent asserted in the complaint. Bennett argued that Atlanta Gas’s IPR was time barred, but the PTAB disagreed. The PTAB instituted review of all challenged claims and found every challenged claim unpatentable in a final written decision. After issuance of the PTAB’s final decision, Bennett sought sanctions from the PTAB for Atlanta Gas’s failure to notify the PTAB of its changed parentage. The PTAB declined to terminate the IPR but authorized Bennett to move for costs and fees incurred between the date of the PTAB’s final written decision and the grant of sanctions. While a dispute over the amount of costs and fees was ongoing, Bennett appealed the PTAB’s final written decision and award of only monetary sanctions. Atlanta Gas cross-appealed, arguing that the PTAB erred in awarding any sanctions.

On appeal, the Federal Circuit vacated the PTAB’s final written decision, finding the IPR time barred under § 315(b), which prohibits institution “if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner . . .  is served with a complaint alleging infringement of the patent.” The Court explained that the statute endorses no exceptions for dismissed complaints, regardless of whether the complaint was dismissed voluntarily or involuntarily. The Court further noted that there was no dispute that the IPR petition was filed more than a year after the service of the complaint.

On the issue of sanctions, the panel declined to resolve the issue, finding that it lacked jurisdiction because the PTAB had not yet quantified its sanction award. The Court also declined to exercise pendent jurisdiction, explaining that different legal analyses were implicated in the invalidity and sanctions issues, and that the sanction issue—relating to termination and monetary sanctions—was a single issue, not to be arbitrarily divided and resolved.

Practice Note: File a petition for IPR within one year after service of complaint, regardless of the status of a motion to dismiss.

© 2019 McDermott Will & Emery

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Bhanu K. Sadasivan is a partner in the law firm of McDermott Will & Emery LLP and is based in the Firm’s Silicon Valley office. Bhanu’s practice focuses on patent and trade secret litigation, with an emphasis in the life sciences area. Prior to joining McDermott, Bhanu was an associate at international law firms where she litigated intellectual property matters in federal district courts across the nation and in the International Trade Commission (ITC). Bhanu has extensive experience conducting technical analysis regarding the interpretation, validity and infringement of patents.

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