IP Law Daily Assignor not estopped from seeking review of network security patent
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Monday, November 12, 2018

Assignor not estopped from seeking review of network security patent

By George Basharis, J.D.

The assignor of a patented network security logging device that "broadcast" network security threats was not estopped from initiating an inter partes review of the patent, the U.S. Court of Appeals for the Federal Circuit has determined. However, the court also ruled that the Patent Trial and Appeal Board, in invalidated some of the patent’s claims, rendered an interpretation of the term "broadcast" that was overly broad, and the court therefore reversed that decision and remanded the case (Arista Networks, Inc. v. Cisco Systems, Inc., November 9, 2018, Prost, S.).

Cisco Systems, Inc. holds a patent (U.S. Patent No. 7,340,597) on a logging module that monitors and "broadcasts" device configuration changes to security monitors on the network. Subscribers to a multicast address receive the broadcast alerts. A former employee of Cisco invented the logging device. After assigning all rights and patents in the device to Cisco, the former employee founded competing networking company, Arista Networks, Inc., which later filed the inter partes review (IPR) petition challenging the validity of claims made in Cisco’s patent.

After rejecting Cisco’s argument that Arista was estopped from challenging the validity of the patent, the Board invalidated some of the claims challenged by Arista. The Board’s decision was based on its construction of the term "broadcast" as used in the patent. Giving the term what it concluded was its "ordinary and customary" meaning, the Board defined "broadcast" as a transmission to all network devices.

Definition disputed. Cisco and Arista disputed the Board’s definition of "broadcast." According to Cisco, the term meant a transmission to one or more network devices without specifying which devices would ultimately receive the message. On the other hand, Arista argued that the term "broadcast" meant a transmission to one or more network recipients.

Construction tempered by specification. The court of appeals rejected each party’s definition of "broadcast." Patent terms are given their plain meaning, unless a term’s plain meaning is inconsistent with the specification of the patent in which it appears, the court noted. The specification in Cisco’s patent focused on broadcasting via a multicast address. Consistent with the specification’s focus on broadcasting via a multicast address, the term "broadcast," the court concluded, meant a transmission to a device using a multicast address. It did not mean transmissions to every device on a network or to any device on the network.

Estoppel. The Board held that assignor estoppel did not prevent Arista from challenging the validity of Cisco’s patent because the Board determined that Congress did not intend for assignor estoppel to apply in IPR proceedings. It rejected Cisco’s argument that assignor estoppel was a well-established common-law doctrine that should be presumed to apply absent a statutory indication to the contrary.

The court of appeals agreed with Cisco’s common-law argument but it found a statutory indication to the contrary. Even if assignor estoppel was well established at common law, the court reasoned, Sec. 311(a) of the patent law unambiguously authorized any person who is not the owner of a patent to initiate an IPR proceeding. This included an assignor who was no longer the owner of a patent. The court rejected Cisco’s contention that not allowing assignor estoppel in IPR proceedings would encourage forum shopping or that the Board’s decision not to apply assignor estoppel was arbitrary and capricious.

This cases are Nos. 2017-1525 and 2017-1577.

Attorneys: Matthew D. Powers (Tensegrity Law Group LLP) and Lauren Ann Degnan (Fish & Richardson P.C.) for Arista Networks, Inc. John C. O’Quinn (Kirkland & Ellis LLP) and Calvin Alexander Shank (Sterne Kessler Goldstein & Fox, PLLC) for Cisco Systems, Inc.

Companies: Arista Networks, Inc.; Cisco Systems, Inc.

MainStory: TopStory Patent FedCirNews

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