Strategic Considerations In Light Of The New "Skilled Searcher" Standard For IPR Estoppel

• Published date: 11 July 2023
• Subject Matter: Intellectual Property, Patent
• Law Firm: Baker Botts
• Author: Griffin Tolle

Inter partes review ("IPR") proceedings have become a familiar avenue for challenging the validity of a patent since the America Invents Act ("AIA") was passed.¹ IPR proceedings allow a petitioner to challenge patent claims "only on a ground that could be raised under section 102 or 103 and only on the basis of prior art consisting of patents or printed publications."² One of the primary tradeoffs to filing an IPR is that, under 35 U.S.C. ' 315(e)(2), the petitioner "or the real party in interest or privy of the petitioner,"³ is estopped from asserting, in either a district court action or International Trade Commission ("ITC") proceeding, "any ground that the petitioner raised or reasonably could have raised during that inter partes review."⁴

The exact scope and applicability of the IPR estoppel provision has been evolving ever since the AIA codified IPR proceedings.⁵ Recent decisions from the Federal Circuit, however, offer guidance that practitioners should be aware of. In California Institute of Technology v. Broadcom Ltd.,⁶ the Federal Circuit overruled its prior 2016 holding regarding IPR estoppel in Shaw Indus. Grp., Inc. v. Automated Creel Sys's, Inc.⁷ In Shaw the Court held that, so long as the USPTO did not institute IPR based on a particular ground (i.e., the ground was denied or not raised), "' 315(e) would not estop [Petitioner] from bringing its [denied] arguments in either the PTO or the district courts."⁸ Six years later in Cal. Tech. v. Broadcom, the Federal Circuit expressly overruled Shaw's holding, stating that "estoppel applies not just to claims and grounds asserted in the petition and instituted for consideration by the Board, but to all grounds not stated in the petition but which reasonably could have been asserted against the claims included in the petition."⁹

More recently, in Ironburg Inventions Ltd. v. Valve Corp., the Federal Circuit "fully addressed the standards by which a determination is to be made as to what invalidity grounds not presented in a petition are estopped pursuant to ' 315(e)(2)" for the first time.¹⁰ In Ironburg, the Court reviewed "the district court's decision to estop Valve from asserting [] Non-Petitioned Grounds."¹¹ While ultimately vacating and remanding "[b]ecause the district court improperly placed the burden of proof on Valve . . . when instead the burden of proof rests with Ironburg,"¹² the Federal Circuit clarified that, "provided the other conditions of the statute are satisfied, ' 315(e)(2) estops a petitioner as to invalidity grounds a skilled searcher conducting a diligent search reasonably could have been expected to discover, as these are grounds that the petitioner 'reasonably could have raised' in its petition."¹³ The adoption of this new "skilled searcher" standard is consistent with the Federal Circuit's recent trend of cases expanding the scope and applicability of IPR estoppel under 35 U.S.C. ' 315(e)(2).¹⁴ Given that Ironburg was only decided a few months ago and that the Federal Circuit did not apply the newly adopted "skilled searcher" standard in Ironburg,¹⁵ practitioners should monitor how parties argue this issue (e.g., what evidence and potential experts parties use to show what a skilled searcher conducting a diligent search would have found) and how district courts apply this...