Takeaway: The mere existence of an exclusive license does not establish third party control over the proceeding such that the third party is a real party-in-interest. Moreover, an expert declaration should not be excluded merely because the expert is an employee of the sponsoring party.

In its Decision, the Board granted institution of inter partes review of certain challenged claims of a light-emitting diode patent. The ‘091 patent is “directed to an electronic device comprising quantum dots embedded in a host matrix, with a primary light source that causes the quantum dots to emit secondary light of a selected color, and to method of making such a device.” Petitioner challenged claims 1-29 of the ‘091 patent under various grounds of anticipation and obviousness. The Board, however, only instituted trial for claims 1-3, 8, 10-15, 17, 19-23, and 28.

As an initial matter, the Board rejected Patent Owner’s argument that the Petition failed to identify all real parties-in-interest, which is a “threshold issue” that is a “highly fact-dependent question.” Patent Owner argued that Dow should have been identified as a real party-in-interest (RPI) because Dow and Petitioner “have a global licensing agreement under which Dow Electronic Materials (a business unit of Dow) has exclusive world-wide rights to ‘the sale, marketing, and manufacture of Petitioner’s cadmium-free quantum dots for use in electronic displays.’” According to Patent Owner,

this exclusive license “is directed to the same technology as that of the ‘091 patent,” and therefore “it is likely that Dow and [Petitioner] will act in unison for all purposes regarding this inter partes review proceeding.” Patent Owner argues Dow “likely constitutes a real-party-interest” because it “likely has an opportunity to control this inter partes proceeding based on its relationship with Petitioner.

The Board, however, was not persuaded by Patent Owner’s argument. “There is no evidence in the record before us that Dow has the ability to control this proceeding to the extent that would be expected of a formal copetitioner.” And the “mere existence of an exclusive license does not establish that Dow has control over the current proceeding such that it should have been named as an RPI.” As such, the Board was “not persuaded, on the current record, that Dow is an RPI to this proceeding.” And the “fact that the Petition does not identify Dow does not prevent the Board from considering Petitioner’s grounds of unpatentability.”

Next, the Board briefly addressed Patent Owner’s argument that Petitioner’s expert declaration should be excluded or afforded less weight because the witness is not “a disinterested third party technical expert whose compensation is not dependent on the outcome of this proceeding” and thus the expert’s testimony is “inherently biased testimony” by virtue of employment by Petitioner. The Board was not persuaded, merely stating that it will “give it weight.”

The Board next turned to claim construction, using the broadest reasonable construction, and the asserted grounds of unpatentability. Following detailed analysis, the Board granted inter partes review as to claims 1-3, 8, 10-15, 17, 19-23, and 28 of the ‘091 patent under § 102 grounds for various references. Notably, in its analysis of the obviousness challenges that were not instituted, the Board repeatedly noted that “[c]hallenging claims under an obviousness alternative to anticipation does not relieve Petitioner of the burden of articulating ‘reasoning with rational underpinning’ to show obviousness.” See KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 418 (2007). Indeed, such reasoning “should be made explicit.” Id. Merely restating “one of the basic tests identified by the Supreme Court for determining whether an invention would have been obvious” is conclusory and not sufficient. Indeed, “[g]eneral principles on what may constitute a supporting rationale cannot substitute for specific application of those principles to the facts.”

Nanoco Tech., Ltd. v. Massachusetts Institute of Technology, IPR2015-00532
Paper 8: Decision Granting-In-Part Institution of Inter Partes Review
Dated: July 27, 2015
Patent: 6,501,091 B1
Before: Donna M. Praiss, Lynne E. Pettigrew, and Jo-Anne M. Kokoski
Written by: Kokoski