PTAB Designates As Precedential A Decision Finding Assignor Estoppel Is Not A Defense in IPRs

Written by Damien Howard and Nathanael Luman, Ph.D.

The PTAB recently designated as precedential its 2013 decision that assignor estoppel is not a defense for patent owners in IPR proceedings in Athena Automation Ltd. v. Husky Injection Molding Systems Ltd., IPR2013-00290, Paper 18 (P.T.A.B. October 25, 2013) (designated precedential August 2, 2017).  

Husky, the Patent Owner, asserted in its preliminary response that Athena is barred from bringing its IPR petition by the doctrine of assignor estoppel.  Husky based its assertion on the contention that one of the named inventors of Husky’s patent is the founder, co-owner, President, Chief Executive Office, and one of two directors on the Board of Directors of Athena, and is therefore in privity with Athena.

The PTAB determined that assignor estoppel is not a defense in an IPR.  The PTAB relied on the language of 35 U.S.C. § 311(a), which states: “a person who is not the owner of a patent may file with the Office a petition to institute an inter partes review of the patent.” (emphasis added).  The Board reasoned that the statutory language permits any person who is not the owner of a patent to file a petition for IPR.  Therefore, the Board held that the statute permits an assignor, who is no longer an owner of the patent at the time of filing, to file an IPR petition.

The PTAB contrasted 35 U.S.C. § 311(a) of IPRs to 19 U.S.C. § 1337(c) (relating to ITC proceedings) in which Congress explicitly provided that “[a]ll legal and equitable defenses may be presented in all cases.”  Based on this statutory provision, the ITC had concluded that assignor estoppel must be considered when a patent owner seeks to have infringing goods excluded from the United States.  See Lannom Mfg. Co. v. Int’l Trade Comm’n, 799 f . 2d 1572, 1579 (Fed. Cir. 1986).  Because Congress did not issue a similar mandate to the Office in connection with AIA post-grant reviews, the PTAB concluded that assignor estoppel is not an exception to 35 U.S.C. § 311(a) and does not prevent the institution of an IPR trial.

Husky had appealed the assignor estoppel issue to the Federal Circuit in Husky Injection Molding Systems Ltd. v. Athena Automation Ltd., 838 F . 3d, 1236, 1245-47 (Fed. Cir.  2016).  The Federal Circuit declined to rule on whether assignor estoppel is applicable because the Federal Circuit concluded that it lacked jurisdiction to review the PTAB’s decision on whether to institute the IPR.

The designation of the PTAB’s decision as precedential coupled with the Federal Circuit’s decision may completely remove assignor estoppel as a defense in IPRs.