Parus Holdings, Inc.

Patent Trials and Appeals Board

Nov 18, 2020

IPR2020-00687 (P.T.A.B. Nov. 18, 2020)

Trials@uspto.gov Paper 12
571-272-7822 Entered: November 18, 2020

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

APPLE INC.,
Petitioner,

v.

PARUS HOLDINGS, INC.,
Patent Owner.
____________

IPR2020-00687
Patent 9,451,084 B2
____________

Before DAVID C. MCKONE, STACEY G. WHITE, and
SHELDON M. MCGEE, Administrative Patent Judges.

PER CURIAM.

DECISION
Denying Patent Owner’s Request on Rehearing of Decision on Institution
37 C.F.R. § 42.71(d)

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Patent 9,451,084 B2
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I. INTRODUCTION
A. Background and Summary
Apple Inc. (“Petitioner”) filed a Petition requesting an inter partes
review of claims 1–7, 10, and 14 of U.S. Patent No. 9,451,084 B2 (Ex. 1030,
“the ’084 patent”). Paper 1 (“Pet.”). Parus Holdings, Inc. (“Patent Owner”)
filed a Preliminary Response to the Petition. Paper 6 (“Prelim. Resp.”).
Pursuant to our authorization (Ex. 1033), Petitioner filed a Reply, Paper 7
(“Reply”), and Patent Owner filed a Sur-reply, Paper 8 (“Sur-reply”).
Upon consideration of the Petition, Preliminary Response, Reply, and
Sur-reply, we instituted an inter partes review of the ’084 patent. Paper 9
(“Dec.”), 1. In doing so, we rejected arguments by Patent Owner that we
should exercise our discretion under 35 U.S.C. § 314(a), NHK Spring Co. v.
Intri-Plex Techs., Inc., IPR2018-00752, Paper 8 (PTAB Sept. 12, 2018)
(precedential), and Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11
(PTAB Mar. 20, 2020) (precedential), to deny the petition in light of a trial
scheduled in Parus Holdings Inc. v. Apple, Inc., No. 6:19-cv-00432 (W.D.
Tex.1) (“the Texas case”). Dec. 10–22.
Patent Owner asks us to reconsider our Decision not to exercise our
discretion to deny the Petition in light of alleged “new facts that have arisen
since the Board’s Decision, which decidedly tilt the Fintiv factors in favor of
denying institution in light of the earlier trial in the Parallel Proceeding in
the District Court for the Western District of Texas.” Paper 11 (“Req.”), 1.
For the reasons given below, we decline to modify our Decision.

1 We refer to the United States District Court for the Western District of
Texas, Waco Division, as “the Texas court” in this Decision.
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II. ANALYSIS
A. Legal Background
When rehearing a decision on institution, we review the decision for
an abuse of discretion. See 37 C.F.R. § 42.71(c) (2019). An abuse of
discretion may be indicated if a decision is based on an erroneous
interpretation of law, if a factual finding is not supported by substantial
evidence, or if the decision represents an unreasonable judgment in weighing
relevant factors. See Star Fruits S.N.C. v. U.S., 393 F.3d 1277, 1281
(Fed. Cir. 2005); Arnold P’ship v. Dudas, 362 F.3d 1338, 1340 (Fed. Cir.
2004); In re Gartside, 203 F.3d 1305, 1315–16 (Fed. Cir. 2000). The
burden of showing that the Institution Decision should be modified is on
Patent Owner, the party challenging the Decision. See 37 C.F.R. § 42.71(d)
(2019). In addition, “[t]he request must specifically identify all matters the
party believes [we] misapprehended or overlooked, and the place where each
matter was previously addressed in a motion, an opposition, or a reply.” Id.
Institution of inter partes review is discretionary. See Harmonic Inc.
v. Avid Tech., Inc., 815 F.3d 1356, 1367 (Fed. Cir. 2016) (“[T]he PTO is
permitted, but never compelled, to institute an IPR proceeding.”); 35 U.S.C.
§ 314(a). The Board has held that the advanced state of a parallel district
court action is a factor that may weigh in favor of denying a petition under
§ 314(a). See NHK Spring, Paper 8 at 20; Patent Trial and Appeal Board,
Consolidated Trial Practice Guide, 58 & n.2 (Nov. 2019). We consider the
following factors to assess “whether efficiency, fairness, and the merits
support the exercise of authority to deny institution in view of an earlier trial
date in the parallel proceeding”:
1. whether the court granted a stay or evidence exists that
one may be granted if a proceeding is instituted;
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2. proximity of the court’s trial date to the Board’s
projected statutory deadline for a final written decision;
3. investment in the parallel proceeding by the court and the
parties;
4. overlap between issues raised in the petition and in the
parallel proceeding;
5. whether the petitioner and the defendant in the parallel
proceeding are the same party; and
6. other circumstances that impact the Board’s exercise of
discretion, including the merits.
Fintiv, Paper 11 at 5–6. In evaluating these factors, we “take[] a holistic
view of whether efficiency and integrity of the system are best served by
denying or instituting review.” Id. at 6.
B. Patent Owner’s Arguments
Patent Owner does not argue that we misapprehended or overlooked
any argument or evidence that it presented previously. Rather, Patent Owner
argues that we should re-evaluate our Decision in light of “new facts” that
have arisen in the Texas court after our Decision. Req. 1–2. In particular,
Patent Owner argues that
(1) Petitioner has moved for, and Patent Owner has opposed, a stay in
the Texas court, which should impact our evaluation of Fintiv
factor 1; and
(2) Petitioner and Patent Owner have indicated that they are available
for trial in July 2021, and
(3) the Texas court has resumed conducting jury trials, which,
together, should impact our evaluation of Fintiv factors 2 and 5
by removing any doubt that a trial in the Texas court will
happen in July 2021. Id.

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1. Fintiv Factor 1: Whether the court granted a stay or
evidence exists that one may be granted if a proceeding is
instituted
Patent Owner asserts that Petitioner requested a stay in the Texas
court on October 1, 2020, and that Patent Owner opposed the request on the
next day. Req. 5. Patent Owner argues that a decision from the Texas court
on the motion to stay is imminent and that, given its prior rulings “in exactly
the same circumstances,” the Texas court will deny the motion. Id.
Patent Owner did not make this argument in its Preliminary Response
or Sur-reply; thus, we could not have misapprehended or overlooked it. For
that reason alone, Patent Owner’s new argument is improper and
insufficient. Nevertheless, even if we were to consider the argument, it
would not be persuasive.
In the Decision, we made clear that it would improper for us to
speculate as to how the Texas court might rule on a motion to stay. Dec. 13
(citing Sand Revolution II, LLC v. Continental Intermodal Group – Trucking
LLC, IPR2019-01393, Paper 24 at 7 (PTAB June 16, 2020) (informative);
Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 15 at 12 (PTAB May 13,
2020) (informative) (“Fintiv II”)). On that basis, we determined that this
Fintiv factor was neutral as to whether we should exercise our discretion to
deny the Petition. Id.
The circumstances have not changed materially in the Texas court.
Although a motion to stay has been filed, the Texas court has not ruled on it.
Accordingly, Patent Owner still asks us to speculate as to how the Texas
court might rule. We decline to speculate, and instead determine that this
factor remains neutral. See Sand Revolution, Paper 24 at 7; Fintiv II,
Paper 15 at 12.
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2. Fintiv Factor 2: Proximity of the court’s trial date to the
Board’s projected statutory deadline for a final written decision
/ Fintiv Factor 5: Whether the petitioner and the defendant in
the parallel proceeding are the same party
The Texas court’s scheduling order sets a “Predicted Jury
Selection/Trial” for July 12–30, 2021. Ex. 1032, 2. As to Fintiv factor 2, we
determined that “it would be speculative to rely on a range of predicted jury
trial dates and then give such speculation weight in our analysis of whether
to exercise our discretion to deny institution.” Dec. 15. Thus, we decided,
“[w]hether the Texas court’s trial takes place before, contemporaneously
with, or after our final written decision statutory deadline involves
substantial speculation,” and determined this factor is neutral to whether we
should exercise our discretion to deny the Petition. Id. at 14, 22. As to
Fintiv factor 5, we explained that “[t]his fact could weigh either in favor of,
or against, exercising discretion to deny institution, depending on which
tribunal was likely to address the challenged patent first,” a matter on which
we declined to speculate and, accordingly, we determined the factor to be
neutral. Id. at 21.
Patent Owner argues that, after pre-institution briefing, the Texas
court held a Markman hearing, during which the Texas court stated that the
Texas case would have a trial during the latter half of July 2021, and
requested that the parties provide their availability. Req. 4 (citing Ex. 2017,
52–53). According to Patent Owner, after our Decision, both Petitioner and
Patent Owner indicated to the Texas court that they are available for a trial
between July 12–23. Id. (citing Ex. 2018). Patent Owner further argues that
“jury trials are now going forward in the Western District of Texas,” and the
Texas court “is hearing a patent case this week.” Id. (citing Ex. 2019). In
light of these developments, Patent Owner argues, “[t]here is thus no reason
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to doubt that the district court trial will go forward in July 2021.” Id. Patent
Owner concludes that Fintiv factors 2 and 5 “now weigh heavily against
institution.” Id. at 4–5.
Patent Owner did not make this argument in its Preliminary Response
or Sur-reply; thus, we could not have misapprehended or overlooked it. For
that reason alone, Patent Owner’s new argument is improper and
insufficient. Nevertheless, even if we were to consider the argument, it
would not be persuasive.
We do not view the circumstances to have changed materially. At the
Markman hearing, the Texas court reiterated “the goal of the Court . . . to get
the case tried in July,” and indicated that it was “not going to pick a date
right now,” but that it was “looking at setting trial in this case somewhere
between July 12th and the end of July [2021].” Ex. 2017, 52:16–20, 53:9–
10. The Texas court then asked counsel for Petitioner and several other
defendants in the Texas case and related cases to consult their calendars and
suggest dates for the trial. Id. at 52:20–53:13. Petitioner, Patent Owner, and
two other defendants later informed the Texas court that they could be
available for trial between July 12 and either July 23 or July 31, 2021.
Ex. 2018. Another defendant indicated that it could be available after
August 9, 2021. Id. The record does not indicate that the Texas court has
set a trial date as of yet. Thus, while the Texas court might still have a
“goal” of a July 2021 trial, the Texas court does not look to have calendared
such a trial.
Fintiv factor 2 looks at the proximity of the trial date to the date of our
final decision to assess the weight to be accorded a trial date set earlier than
the expected final written decision date. This proximity inquiry is a proxy
for the likelihood that the trial court will reach a decision on validity issues
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Patent 9,451,084 B2
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before the Board reaches a final written decision. A trial set to occur soon
after the institution decision is fairly likely to happen prior to the Board’s
final decision, even if the trial date were postponed due to intervening
circumstances. Here, however, the trial still is predicted to be scheduled for
approximately two months before our final written decision is due. Even
considering the allegedly changed circumstances raised by Patent Owner,
there is at least some persuasive evidence that delays are possible. In these
circumstances, the efficiency and system integrity concerns that animate the
Fintiv analysis are not as strong—all other things being equal. Accordingly,
even if we were to consider Patent Owner’s new arguments, this factor still
would be, at best, neutral to whether we should exercise our discretion to
deny the Petition. For the same reasons, our analysis of Fintiv factor 5 also
would remain unchanged.

III. CONCLUSION
For the foregoing reasons, Patent Owner has not demonstrated that we
misapprehended or overlooked its arguments or abused our discretion in
instituting a trial of the ’084 patent.

IV. ORDER
In consideration of the foregoing, it is hereby:
ORDERED Patent Owner’s Request for Rehearing is denied.

IPR2020-00687
Patent 9,451,084 B2
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FOR PETITIONER:
Jennifer C. Bailey
Adam P. Seitz
ERISE IP, P.A.
Jennifer.Bailey@eriseip.com
Adam.Seitz@eriseip.com

FOR PATENT OWNER:
Michael J. McNamara
Michael T. Renaud
William A. Meunier
MINTZ, LEVIN, COHN, FERRIS, GLOVSKY AND
POPEO, P.C.
mmcnamara@mintz.com
mtrenaud@mintz.com
wameunier@mintz.com