Takeaway: The focus of a privity inquiry should be on the relationship between the parties during the prior lawsuit.

In its Decision, the Board instituted inter partes review of claims 1-3 and 6 of the ‘088 based on various obviousness grounds. In doing so, the Board determined that the Petition was not barred under 35 U.S.C. § 315(b).

Petitioner had filed a Petition seeking inter partes review of claims 1-3 and 6 of the ‘088 patent. The Board then authorized further briefing with respect to real party in interest and privity issues. The ‘088 patent is directed to “a network of interconnected gaming machines, such as slot machines or video poker machines, on which players can trigger a second bonus game after playing a first regular game.”

The Petitioner in the instant case is Aruze Gaming Macau, LTD (“AGM”). The ‘088 patent was asserted against Aruze Gaming America, Inc. (“AGA”) in an action severed from a prior lawsuit in which the complaint was served on AGA on November 5, 2012 (which is more than a year prior to the filing of AGM’s Petition). Patent Owner argued that AGM’s Petition is barred under 35 U.S.C. § 315(b) because “AGA is either a real party in interest (‘RPI’) to this proceeding, or a privy of AGM.” Thus, the Board needed to ascertain the specific relationship, if any, between AGM and AGA.

The Board began by discussing the history and relationship between the concepts of RPI and privity. Citing 35 U.S.C. § 315(b), the Board then noted that a Petition must identify all real parties-in-interest, but not privies. Next, the Board determined there was a reasonable likelihood that AGA is not an RPI to this proceeding, and that AGA and AGM are not in privity. In doing so, the Board indicated that Patent Owner was not precluded from seeking further discovery on these issues during trial, or from presenting further evidence in the Patent Owner’s Response.

Petitioner had proposed the following as grounds of unpatentability: claims 1-3 and 6 are anticipated by each of Cannon and Marnell under 35 U.S.C. § 102; and claims 1-3 and 6 would have been obvious in view of Marnell, taken alone or in combination with Cannon, under 35 U.S.C. § 103.  The Board adopted its prior claim construction from previous IPR2013-00120, and also adopted its prior conclusions and reasoning from previous IPR2013-00120 in determining that the Petition in the instant proceeding had established a reasonable likelihood that Patent Owner would prevail with respect to all of the proposed grounds except anticipation by Marnell.  As to the anticipation argument based on Marnell, the Board indicated that Patent Owner had not adequately explained why this proposed ground of unpatentability was sufficiently distinctive from the other three grounds and therefore viewed this fourth ground as redundant of the grounds on which the Board was instituting trial.

Aruze Gaming Macau, Ltd. v. MGT Gaming, Inc., IPR2014-01288
Paper 13: Decision on Institution of Inter Partes Review
Dated: February 20, 2015
Patent 7,892,088 B2
Before: Richard E. Rice, Christopher L. Crumbley, and Carl M. DeFranco
Written by: Crumbley Related Proceedings: MGT Gaming, Inc. v. ARUZE Gaming America Inc., Civil Action 3:13-cv-00693-CWR-FKB (S.D. Miss.); WMS Gaming Inc. v. MGT Gaming Inc., Case IPR2013-00120