Timing Is Everything When It Comes To Interlocutory Appeals of CBMR-Related Motions To Stay

GavelThe issue of when interlocutory appellate jurisdiction vests with the Federal Circuit under Section 18 of the AIA to review a district court’s decision on a motion to stay in view of a related CBMR was recently addressed in Intellectual Ventures II LLC, v. JPMorgan Chase & Co., et al., 2014-1724.

The filing of a motion to stay federal patent litigation in view of a related IPR or CBMR is commonplace.  Generally, a district court’s decision on such a motion is not immediately appealable under the final judgment rule governing appellate jurisdiction.  However, Section 18 of the AIA carves out a statutory grant of jurisdiction to the Federal Circuit to hear immediate interlocutory appeals of decisions on motions to stay “relating to a [CBMR] proceeding for that patent [asserted in the district court]…”  In Intellectual Ventures, the Federal Circuit held that a CBMR “proceeding” does not begin when the petition is filed, but, instead, only begins once the PTAB institutes review.  Therefore, the Federal Circuit’s jurisdiction to hear an interlocutory appeal of a decision on a motion to stay a case having a related CBMR only vests once the PTAB institutes review.

The underlying case is pending in the Southern District of New York, where Intellectual Ventures has asserted multiple patents against JPMorgan and other defendants.  About a year after the case was filed, JPMorgan filed a motion to stay based on its anticipated filing of four CBMR petitions.  Shortly thereafter, JPMorgan in fact filed two CBMR petitions (but did not file the other two promised petitions).  Applying the four-factor test set forth in AIA § 18(b)(1), the district court denied JPMorgan’s motion to stay.  JPMorgan filed an interlocutory appeal to the Federal Circuit, asserting that the Federal Circuit had jurisdiction under AIA § 18(b).  JPMorgan argued that (i) a CBMR “proceeding” begins as soon as a party files a CBMR petition, and (ii) alternatively, even if a CBMR “proceeding” does not commence until the PTAB institutes such a proceeding, a petition for a proceeding (or even the anticipation of the filing of a petition) is sufficiently “related” to a proceeding to give rise to jurisdiction under § 18(b)(2).  The Federal Circuit analyzed the statutory language of the AIA as well as the congressional record and concluded that a CBMR “proceeding” commences only when the PTAB institutes review.  The Federal Circuit also dismissed JPMorgan’s second argument, concluding that the clear language of AIA §18(b) only gives the Federal Circuit jurisdiction over a decision on a motion to stay “that is related to an actual CBMR proceeding, not a decision on a motion to stay that is related to anything that relates – however remotely – to a hoped-for CBMR proceeding.”  (emphasis in original)  Though not at issue in this case, the Federal Circuit noted that its decision does not preclude district courts from deciding motions to stay prior to the institution of a CBMR proceeding.

While the timing of when to file a motion to stay in view of a related IPR or CBMR is always a strategic consideration, this case underscores that the immediate interlocutory jurisdiction in the context of related CBMR “proceedings” adds an extra layer of consideration.

Preserving a Complete (and Confidential) Record for Appeal

[pullquote align=”left|center|right” textalign=”left|center|right” width=”30%”]37 CFR §42.56 

Expungement of confidential information: After denial of a petition to institute a trial or after final judgment in a trial, a party may file a motion to expunge confidential information from the record.[/pullquote]

Now that the first wave of Final Decisions have issued from the PTAB, the question has arisen regarding what to do with sealed documents in an IPR record while the decision is appealed.  Pursuant to Patent Office Trial Practice Guide, Rule 42.56, “confidential information that is subject to a protective order ordinarily would become public…45 days after final judgment in a trial.”  That practice runs counter, of course, to the need for a complete record for purposes of appeal.

In Illimina v. Columbia University, IPR2012-00006, the parties filed a Joint Motion asking that the record in the proceeding be preserved pending the outcome of a possible appeal “including preservation of all sealed documents in non-public form.” The Joint Motion alternatively asked that the sealed files be expunged from the record pursuant to 37 C.F.R. § 42.56. The Board decided under the present circumstances, it is reasonable to maintain the record undisturbed pending outcome of any appeal. At the conclusion of any appeal proceeding however, if the parties do not contact the Board, then the information filed under seal will be made public in due course. Decision at 3.