In ParkerVision, Inc. v. Qualcomm Inc., No. 2022-1755, -2221 (Fed. Cir. Sept. 6, 2024) (“ParkerVision III”), the Federal Circuit held that, due to the difference in burdens of proof in PTAB IPR proceedings and in district court cases, collateral estoppel cannot be applied in a district court case based on findings made by the PTAB in connection with a decision that related, but not identical claims are unpatentable:
Although we have not previously addressed the question of whether a finding underlying an unpatentability decision in an IPR proceeding collaterally estops a patentee from making validity arguments regarding separate, related claims in district court litigation, we now hold that it does not.
A series of patent infringement cases between ParkerVision and Qualcomm began in 2011, when ParkerVision sued Qualcomm for infringement of a patent relating to wireless technology, and “down-converting” of a high-frequency electromagnetic signal into a low-frequency signal. In ParkerVision, Inc. v. Qualcomm Inc., 621 F. App’x 1009 (Fed. Cir. 2015) (“ParkerVision I”), the Federal Circuit affirmed the district court’s grant of JMOL of non-infringement. ParkerVision filed a second infringement action in 2014, asserting related patents not at issue in ParkerVision I. In response, Qualcomm filed several IPR petitions, including one challenging claims of ParkerVision’s U.S. Patent No. 6,091,940. In that case, the PTAB determined that the challenged apparatus claims are unpatentable for obviousness, but that Qualcomm failed to prove that the challenged method claims would have been obvious. The Federal Circuit affirmed that decision. ParkerVision, Inc. v. Qualcomm Inc., 903 F.3d 1354, 1362- 63 (Fed. Cir. 2018) (“ParkerVision II”).
In the 2014 Action, the district court determined that the PTAB’s unpatentability decision with respect to the ’940 patent’s apparatus claims collaterally estopped ParkerVision from relitigating characteristics of the prior art references on which Qualcomm’s invalidity contentions rested, based on the PTAB’s findings concerning the disclosures of that prior art made in the IPR of the ’940 patent. The court also granted Qualcomm’s motion to exclude ParkerVision’s expert from testifying on validity of the asserted method claims, based on collateral estoppel in view of the Court’s decision in ParkerVision II, affirming the PTAB’s determination that the asserted apparatus claims were unpatentable. The district court also granted summary judgment of non-infringement based on collateral estoppel, in view of the court’s determination that the claims at issue in ParkerVision II were not materially different from those determined to be not infringed in ParkerVision I. The court entered final judgment of non-infringement, and dismissed without prejudice Qualcomm’s counterclaims for invalidity. ParkerVision III, Slip Op. at 11.
On appeal, the Federal Circuit vacated the district court’s grant of summary judgment of non-infringement, on the basis that the asserted claims were materially different from those determined to be not infringed in ParkerVision I, and remanded the case for the district court to construe the claims and evaluate infringement. Id. at at 20-23. Although the final decision on review was judgment of non-infringement, “in the interest of judicial economy,” the Court exercised its “discretion to review an issue [that] will be important on remand,” the application of collateral estoppel with respect to invalidity. Id. at 24.
Citing B & B Hardware, Inc. v. Hargis Indus., Inc., 575 U.S. 138, 148 (2015), the Court noted that the application of collateral estoppel is “subject to certain well-known exceptions,” and determined that a finding underlying an unpatentability decision in an IPR proceeding does not collaterally estop a patentee from making validity arguments regarding separate, related claims in district court litigation, because of different burdens of proof in the PTAB and in district court. In particular, in an IPR proceeding, unpatentability must be proven by a preponderance of the evidence, in contrast to a district court proceeding in which invalidity must be proven by clear and convincing evidence. Thus the Court determined that no finding of the PTAB “estops ParkerVision from presenting evidence on the unresolved question of whether Qualcomm is able to prove the capabilities of the prior art apparatus (and the other components of its invalidity contention) by clear and convincing evidence.”
The Court stated that its decision was not inconsistent with its earlier decision in XY, LLC v. Trans Ova Genetics, 890 F.3d 1282 (Fed. Cir. 2018), because that case involved application of collateral estoppel with respect to the identical claims canceled in an IPR, not similar claims.
The Court’s decision in this case is surprising, and difficult to square with the Court’s statement in XY, LLC that “the affirmance of an invalidity finding, whether from a district court or the Board, has a collateral estoppel effect on all pending or co-pending actions,” and with the statement in Ohio Willow Wood Co. v. Alps S., LLC, 735 F.3d 1333, 1342 (Fed. Cir. 2013) (emphasis added), that collateral estoppel applies when “the differences between the unadjudicated patent claims and adjudicated patent claims do not materially alter the question” at issue. The Court’s decision also appears to be inconsistent with non-precedential Federal Circuit decisions affirming the application of collateral estoppel in similar situations (district court appeals in which the court applied collateral estoppel based on PTAB final decisions). See, e.g., Think Prods., Inc. v. ACCO Brands Corp., 419 F. Supp. 3d 1078, 1084 (N.D. Ill. 2019), aff’d, 854 F. App’x 374 (Fed. Cir. 2021); see also this earlier post, citing a number of district court cases addressing this issue.
Parties involved in litigation of patent claims that are similar or related to claims that have been canceled in IPR proceedings should give this case careful consideration before making arguments about the application of collateral estoppel.