USPTO and Facebook Submit Briefs Explaining Effects of Thryv Ruling on Facebook v. Windy City

Last week, Facebook and the USPTO both filed briefs in response to a U.S. Court of Appeals for the Federal Circuit (CAFC) Order requesting that the parties and the U.S. Patent and Trademark Office (USPTO) file supplemental briefs explaining their views regarding the effect of the Supreme Court’s April 20, 2020 decision in Thryv, Inc. v. Click-To-Call Techs, LP on the CAFC’s March 18, 2020 decision in Facebook v. Windy City Innovations.  In Facebook, the CAFC ruled that the USPTO’s Patent Trial and Appeal Board (PTAB) erred both in allowing Facebook to join itself to a proceeding in which it was already a party, and in allowing Facebook to add new claims to the inter partes reviews (IPRs) at issue through that joinder.

In 2015, Windy City Innovations filed a suit against Facebook for infringement of Windy City’s U.S. Patent Nos. 8,458,245 (“the ’245 patent”); 8,694,657 (“the ’657 patent”); 8,473,552 (“the ’552 patent”); and 8,407,356 (“the ’356 patent”), which included a total of 830 claims.  One year later Facebook petitioned for IPR of several claims of each patent and the Board instituted review. Windy City substquently identified additional claims in the district court proceeding that were not subject to the IPR proceedings. In response, Facebook filed two additional petitions for IPR of the additional claims and filed motions for joinder to the already instituted IPRs. The Board instituted Facebook’s two new IPRs and granted Facebook’s motions for joinder.

In a cross-appeal of the Board’s final written decision, Windy City challenged the Board’s joinder decisions and its decision to allow Facebook to include new claims in the joined proceedings. The CAFC concluded that “the Board’s joinder decisions, which allowed Facebook to join itself to a proceeding in which it was already a party, and to add otherwise time-barred issues to the IPRs, were improper under § 315(c).”

Facebook then filed a combined petition for panel rehearing and rehearing en banc arguing “that the panel lacked jurisdiction under Section 314(d) to review the PTO’s decisions to institute IPR and order joinder, and noted the relevance of the then-pending Thryv appeal in the Supreme Court.”  On April 30, 2020, the CAFC issued an order inviting Facebook, Windy City, and “the Director of the United States Patent and Trademark Office as an amicus curiae, to file supplemental briefs explaining their views regarding the effect, if any, of the Supreme Court’s decision in Thryv” on the CAFC’s decision in Facebook within 10 days of the order.

Facebook’s Brief

In its brief dated June 10, Facebook asserted that The Supreme Court’s recent decision in Thryv dictated that the CAFC lacked jurisdiction to review the decision of the USPTO to institute inter partes review (IPR) and order joinder in the present case. Facebook also noted that the Thryv decision provided that 35 U.S.C. § 314(d) “bars review at least of matters ‘closely tied to the application and interpretation of statutes related to’ the [USPTO’s IPR] institution decision”, such as the Board’s decision that an IPR petition is timely filed or a decision “to institute a second IPR and join it to an existing IPR.”

Facebook further noted that the Supreme Court in Thryv explained that “[a] successful § 315(b) appeal would terminate in vacatur of the agency’s decision”; thus, “in lieu of enabling judicial review of patentability, vacatur would unwind the agency’s merits decision” contrary to Congress’s intent. According to Facebook, Windy City does exactly that by seeking to “undo the Board’s merits decisions based on procedural objections about institution that have nothing to do with the validity of its patents.”

Facebook argued that “the one-year time limit in Section 315(b) for petitioning for IPR ‘does not apply to a request for joinder’” and, further, the Board’s joinder decision is “integral to, indeed a condition on, institution.” Thus, Facebook noted that Windy City’s cross-appeal impermissibly challenges the Board’s “application and interpretation of [a] statute [] related to the institution decision”, which is not subject to judicial review in accordance with Thryv.  Noting that “any attempt to revisit an institution decision after resolution of a patent’s validity in an IPR would ‘wast[e] the resources spent resolving patentability’ and risk ‘leaving bad patents enforceable’, Facebook concluded requesting rehearing and dismissal of Windy City’s cross-appeal for lack of jurisdiction.

USPTO Brief

The USPTO’s brief emphasized its view that “Thryv makes clear that 35 U.S.C. § 314(d) bars judicial review of the Patent Trial and Appeal Board’s joinder decision in this case”, the CAFC’s panel opinion should be vacated, and Windy City’s cross- appeal challenging the Board’s joinder decision should be dismissed.  The USPTO first explained that the 35 U.S.C. § 315(b) states “[a]n inter partes review may not be instituted if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner [or a related party] … is served with a complaint alleging infringement of the patent”, but § 315(b) adds that “[t]he time limitation set forth in the preceding sentence shall not apply to a request for joinder under subsection (c).”

The USPTO then noted that at the time of the Facebook decision, the CAFC was bound by Wi-Fi One, LLC  v. Broadcom Corp., which held that the PTAB’s  time-bar determinations under section 315(b) were appealable. Thus, the CAFC’s decision did not address whether it had jurisdiction to review the Board’s joinder decisions. The USPTO noted that the Thryv decision of April 20, 2020, set forth that the Board’s “application of § 315(b)’s time limit … is closely related to its decision whether to institute inter partes review and is therefore rendered nonappealable by § 314(d).”

The USPTO further explained that 35 U.S.C. § 314(d) provides that the Board’s decision “whether to institute an inter partes review” is “final and nonappealable” and, according to Thryv, that bar on judicial review “extends at least to any challenge to an institution decision ‘grounded in statutes related to the institution decision’” including a challenge based on section 315(b)’s time limitation.

The USPTO argued that appellate review of the Board’s joinder decision in this case was barred by section 314(d) because the Board’s application of section 315(c) was “integral to, indeed a condition on, institution.” Further, the USPTO explained that the text of section 315(b), which states that IPR’s “may not be instituted” if filed more than one year after a complaint is served, “confirms that, in this context, the joinder decision is integral to the USPTO’s decision to institute on the joining party’s petition.” The USPTO reasoned that Congress would not have expressly “provided an exception to that limitation for ‘joinder under subsection (c)’ unless Congress envisioned that joinder would entail institution of inter partes review proceedings.” Thus, the USPTO stated that “a judicial challenge to the joinder decision necessarily operates as a challenge to the USPTO’s decision to institute inter partes review, and vacating the joinder decision would have the necessary effect of vacating the institution determination.”

Noting that barring review of joinder decisions “furthers Congress’s efforts to improve patent quality and limit litigation costs by focusing judicial review on the merits of the Board’s patentability determinations”, the USPTO concluded that “section 314(d) bars Windy City from challenging the Board’s final written decision on the basis of the Board’s joinder decision.”