by Dennis Crouch
The Federal Circuit has ordered further briefing on VirnetX’s recently filed petition for writ of mandamus stemming from two pending inter partes review petitions filed by Mangrove Partners against the patentee. The case involves the statute-of-limitations that bars a third party petitioner from filing an inter partes review petition more than one year after that petitioner (or a privy) was “served with a complaint alleging infringement of the patent”; the IPR joinder provision; and, of course, the prohibition against appealing the Director’s decision to grant or deny a petition.
According to the VirnetX’s petition, prior to the filing of these inter partes review proceedings: “Apple previously filed (directly or through a proxy) seven inter partes review petitions against the same patents, in addition to having challenged their validity in two reexamination proceedings and (unsuccessfully) in district court litigation and on appeal before this [Appellate] Court.” The Board previously dismissed Apple’s petitions as well as those of its proxy (RPX) as time barred by the statute of limitations since Apple had previously been served an infringement complaint.
These two latest IPRs were filed by the hedge fund Mangrove Partners who had apparently shorted VirnetX stock just prior to the filing and is also an investor in RPX. Following the IPRs filed by Mangrove, Apple again filed its own set of IPR petitions that were obviously time barred, but also simultaneously requested joinder with the Mangrove petitions. This final posturing worked and the Board granted the Apple Petitions and the Joinder request – after reading Section 315(b)’s statement that the statute of limitations noted above “shall not apply to a request for joinder.”
35 U.S.C. §315(b) Patent Owner’s Action.—
An 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, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent. The time limitation set forth in the preceding sentence shall not apply to a request for joinder under subsection (c).
35 U.S.C. §315(c) Joinder.—
If the Director institutes an inter partes review, the Director, in his or her discretion, may join as a party to that inter partes review any person who properly files a petition under section 311 that the Director, after receiving a preliminary response under section 313 or the expiration of the time for filing such a response, determines warrants the institution of an inter partes review under section 314.
In the mandamus action, VirnetX argues that the Board misinterpreted the statute. Rather, according to the petition, the statute-of-limitations applies to all petitions and may not be waived by the Director. According to the argument, the exception for joinder is only relevant to indicate that joinder of properly instituted proceedings can be requested even beyond the one-year deadline. “The timing exemption … mak[es] clear that the one-year time limitation shall not apply to a joinder request.”
[T]he Board treated the terms “petition” and “request for joinder” as interchangeable. But there is no basis for such a reading. Section 315(b), as well as the overall statute, carefully distinguishes between the terms “petition” and “request for joinder.” When Congress uses a particular statutory term, it does so advisedly, and an agency impermissibly departs from the statute when it disregards Congress’ intentional use of different statutory terms. . . . Section 315(b) imposes a mandatory one-year time bar on any “petition requesting the [inter partes] proceeding.” 35 U.S.C. § 315(b). It then exempts “a request for joinder” made under section 315(c)—and only such a request— from that timing prohibition. But section 315(b) does not extend that exemption to “a petition,” even though Congress clearly knew how to apply such an exemption to a petition, as demonstrated elsewhere in the statute. The Board’s interpretation of section 315(b) effectively re-writes the statute by expanding the statutory exemption for joinder requests from a mandatory time bar to petitions.
VirnetX explains the prejudice caused by the joinder:
The joinder has already prejudiced VirnetX in concrete ways. VirnetX now has to defend itself against new issues and evidence introduced by Apple—issues and evidence that were not presented by Mangrove in the original proceedings. VirnetX is also being systematically disadvantaged because it is limited to a single response of a constrained length, while Apple, Mangrove, and Black Swamp submitted three separate petitions each presenting unique issues. Thus, VirnetX has to prepare its Patent Owner’s Responses to invalidity issues raised in three separate petitions, yet the Board denied VirnetX’s request for extra pages in order to be able to fully address all these multiple arguments.
It will be interesting to See how Apple responds. The court asked for responses from Apple, Mangrove, and Director Lee to be filed next week.
= = = = =
 IPR2015-01046 & IPR2015-01047 covering U.S. Patent No. 6,502,135 (“the ’135 patent”) and U.S. Patent No. 7,490,151 (“the ’151 patent”).
 35 U.S.C. § 315(b).
 35 U.S.C. § 315(c).
 IPR2016-00062 and IPR2016-00063.