IP Law Daily LG loses argument that mobile communications patents were obvious and anticipated
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Wednesday, November 6, 2019

LG loses argument that mobile communications patents were obvious and anticipated

By Joseph Arshawsky, J.D.

Wi-LAN’s motion for partial summary judgment of LG’s obviousness defense based on IPR estoppel was granted.

The federal district court in San Diego has granted Plaintiffs Wi-LAN Inc., Wi-LAN USA, Inc., and Wi-LAN Labs, Inc.’s ("Wi-LAN") motion for partial summary judgment of Defendants LG Electronics, Inc., LG Electronics U.S.A., Inc., and LG Electronics Mobilecomm U.S.A., Inc.’s ("LG") obviousness defense based on inter partes review (IPR) estoppel under 35 U.S.C. § 315(e)(2). The court, however, denied LG’s motion for summary judgment that the asserted claims of Wi-Lan’s patents are invalid under Section 102 based on claimed priority date. The court also denied LG’s motion to strike and Wi-LAN’s motion for leave to conduct discovery as moot (Wi-LAN Inc. v. LG Electronics, Inc., November 4, 2019, Huff, M.).

Wi-LAN sued LG for patent infringement of U.S. Patent Nos. 8,787,924, 8,867,351, 9,226,320, and 9,497,743. Wi-LAN alleged that LG’s wireless communication products that are compliant with the 3rd Generation Partnership Project 4G LTE standard directly infringe the patents-in-suit. LG answered Wi-LAN’s complaint along with counterclaims for, among others, a declaratory judgment of invalidity of the patents-in-suit. On April 12, 2019, the court granted in part and denied in part Wi-LAN’s motions to dismiss LG’s counterclaims. On October 24, 2019, the court denied LG’s two motions for summary judgment of non-infringement of the patents-in-suit, granted LG’s motion for summary judgment of no willful infringement, and otherwise ruled on a first round of summary judgment motions. By the present remaining motions for summary judgment: (1) Wi-LAN moved for partial summary judgment of LG’s obviousness defense as to the ’743 patent based on IPR estoppel under 35 U.S.C. § 315(e)(2); and (2) LG moved for summary judgment that the asserted claims of the patents-in-suit are not entitled to their claimed priority dates, and, therefore, are invalid under 35 U.S.C. § 102. The court granted Wi-LAN’s motion and denied LG’s motion.

Patents-in-suit. Wi-LAN alleged infringement of claims 1, 2, 5, 6, 17 and 19 of the ’924 patent, claims 6-9 of the ’743 patent, and claims 7 and 10-12 of the ’351 patent. The ’924 patent and the ’743 patent are both entitled "Method and Systems for Transmission of Multiple Modulated Signals Over Wireless Networks" and share a common specification. The ’351 Patent is entitled "apparatus, system and method for the transmission of data with different QoS attributes." The invention disclosed in the ’351 patent "relates to an apparatus, system and method for providing and managing QoS for data flows transmitted over at least one link in a data network capable of transmitting data with different [quality of service] QoS requirements and/or attributes."

IPR estoppel. Wi-LAN moved for partial summary judgment of LG’s obviousness defense as to the ’743 patent. Wi-LAN argued that 35 U.S.C. § 315(e)(2) estops LG from asserting invalidity of the ’743 patent based on all of its asserted obviousness combinations because LG reasonably could have raised them in the inter partes review (IPR) proceedings for that patent. LG argued that Wi-LAN’s motion should be denied because invalidity grounds that are not instituted as part of an IPR are not estopped under § 315(e)(2). Section 315(e)(2) estoppel applies when: (1) a final written decision is issued in an IPR; (2) the contention at issue asserts invalidity under §§ 102 or 103 based only on prior art consisting of patents or printed publications; and (3) the contention at issue either was raised or reasonably could have been raised during the IPR.

In light of the Supreme Court’s clarification of § 318(a), LG’s argument that IPR estoppel does not apply to non-petitioned grounds is untenable. There can no longer be such a thing as a non-instituted ground. As such, for the phrase "reasonably could have been raised during that inter partes review" in 35 U.S.C. § 315(e)(2) to have any meaning, it must refer to grounds that were not actually in the IPR petition, i.e., non-petitioned grounds, but "reasonably could have been" included in the petition. As such, under § 315(e)(2), LG is estopped from claiming invalidity on any non-petitioned ground that it "reasonably could have raised" in its IPR petition.

Obviousness. Wi-LAN argued that LG should be estopped from asserting its first two obviousness combinations—"Chuah and Kari" and "DOCSIS and Eng"—as to the ’743 patent because LG knew of these grounds before it filed its IPR petition. To support this argument, Wi-LAN pointed to LG’s invalidity contentions in the prior action. LG is estopped under § 315(e)(2) from asserting that the ’743 patent is invalid based on obviousness in light of the "Chuah and Kari" and the "DOCSIS and Eng" combinations.

Wi-LAN also asserted that LG should be estopped from raising its last three obviousness combinations—"Fischer and Sigle," "Karol and Sigle," and "Fischer and Karol and Sigle"—because LG would have found these prior art references through a diligent search. The court agreed with Wi-LAN that the fact that LG eventually found the three refences at issue through a prior art search is compelling evidence itself that LG reasonably could have discovered these references through a diligent search. This evidence, even when viewed in the light most favorable to LG, is sufficient to establish that LG "reasonable could have raised" its obviousness contentions based on those references in the IPR.

Wi-LAN’s motion for partial summary judgment of LG’s obviousness defense based on IPR estoppel under 35 U.S.C. § 315(e)(2) was granted. LG was estopped under § 315(e)(2) from asserting that the ’743 patent is invalid based on obviousness in light of the "Fischer and Sigle," the "Karol and Sigle," and the "Fischer and Karol and Sigle" obviousness combinations.

Priority dates. LG moved for summary judgment that all of the asserted claims of the patents-in-suit are invalid under 35 U.S.C. § 102 as anticipated by Release 8 of the 3GPP LTE Standard. To support this contention, LG also moved for summary judgment that the asserted claims of the patents-in-suit are not entitled to their claimed priority dates and are instead entitled to priority dates no earlier than the respective filing dates of the applications for the patents-in-suit: October 11, 2012, June 12, 2015, and May 30, 2014. LG explained that once the asserted claims are given their filing dates as their priority dates, it is clear that all of the claims are anticipated by the 3GPP LTE Standard, which was publicly released in December 2008.

IPR estoppel, again. Wi-LAN argued that the court should deny LG’s motion as to the ’743 patent because LG’s contention that the ’743 patent is anticipated under § 102 by Release 8 of the 3GPP LTE standard is barred by IPR estoppel under 35 U.S.C. § 315(e)(2). Wi-LAN argued that because LG knew about the 3GPP LTE standard prior to filing its IPR petition as to the ’743 patent, LG’s anticipation contention based on the 3GPP LTE standard "reasonably could have [been] raised" in LG’s IPR petition. LG’s initial invalidity contentions in the prior action identified the 3GPP LTE standard as a prior art reference, and the contentions were served on October 20, 2017, well before the filing of LG’s IPR petition on February 22, 2018. It is clear that LG’s contention that Release 8 of the 3GPP LTE standard anticipates the asserted claims of the ’743 patent is a ground that LG "reasonably could have raised" in its IPR petition. LG offered no argument to the contrary. As such, LG was estopped under § 315(e)(2) from asserting that the ’743 patent is invalid based on anticipation by Release 8 of the 3GPP LTE standard. LG’s motion for summary judgment that the’743 patent is invalid under § 102 because it is not entitled to its claimed priority date was accordingly denied.

Burden of proof. LG’s anticipation argument was based on Wi-LAN’s assertion that mobile devices that are compliant with the 3GPP LTE standard infringe the patents-in-suit. This is sufficient to establish a prima facie case of invalidity under § 102 as to the asserted claims of the ’924 patent and the ’351 patent. Where the anticipation contention is based on an intervening prior art reference and the patentee’s own infringement allegations and contentions, and the specific theory of invalidity was already disclosed in a previously filed motion for summary judgment that is cited in the invalidity contentions, LG’s July 17, 2019 amended invalidity contentions were sufficient to disclose Release 8 of the 3GPP LTE Standard as an anticipatory reference in compliance with the court’s Patent Local Rules. In sum, because LG has established a prima facie case of invalidity based on Release 8 of the 3GPP LTE standard, Wi-LAN bears the burden "to come forward with evidence to prove entitlement to claim priority to an earlier filing date." Nevertheless, LG still retained the ultimate burden of persuasion to prove invalidity of the ’924 patent and the ’351 patent by clear and convincing evidence.

The ’924 patent. LG argued that Wi-LAN cannot establish that the asserted claims of ’924 patent are entitled to their claimed priority date because the application to which they claim priority, U.S. Application No. 09/316,518 ("the ’518 App."), describes only a fixed, singe-cell system with fixed customer premises equipment. LG argued that the ’518 App. does not disclose "wireless cellular mobile unit[s]" or a "bandwidth on demand wireless cellular communication system." (Id. at 9-11.) In response, Wi-LAN argued that the disclosures in ’518 App. are sufficient to support the claims. The court denied LG’s motion for summary judgment that the asserted claims of the ’924 patent are not entitled to their claimed priority date and, therefore, are invalid under § 102.

The ’351 patent. First, LG argued that the ’373 App. does not disclose a "traffic shaping rate." Second, LG argued that the ’373 App. does not disclose a link controller operating a plurality of logical channel queues, where "each of the logical channel queues is capable of being associated with . . . a traffic shaping rate." Third, LG argued that the ’373 App. does not disclose a link controller performing the claimed steps of "select[ing]," "allocate[ing]," and "repeatedly consider[ing]" using a "traffic shaping rate." Fourth, LG argued that Wi-LAN’s validity expert’s analysis was flawed because he failed to address every limitation in the asserted claims. Finally, the court noted that in the denying LG’s IPR petition, the PTAB rejected LG’s argument that the asserted claims of ’351 patent are not entitled to their claimed priority date because the ’373 App. does not disclose a "traffic shaping rate" or any method using a "traffic shaping rate." While the PTAB utilizes a different standard of review in deciding whether to grant IPR petitions than district courts utilize in deciding motions for summary judgment, nevertheless, the court found the PTAB’s analysis of this issue well-reasoned, persuasive, and consistent with the court’s conclusion that LG is not entitled to summary judgment on this issue. The court denied LG’s motion for summary judgment that the asserted claims of the ’351 patent are not entitled to their claimed priority date and, therefore, are invalid under § 102.

This case is No. 18-cv-01577-H-AGS.

Attorneys: Alden Harris (Heim, Payne & Chorush LLP) and Victor M. Felix (Procopio Cory Hargreaves and Savitch LLP) for Wi-LAN Inc., Wi-LAN USA Inc. and Wi-LAN Labs Inc. Benjamin Gilford (Greenberg Traurig LLP) for LG Electronics Inc., LG Electronics USA Inc. and LG Electronics Mobilecomm USA Inc.

Companies: Wi-LAN Inc.; Wi-LAN USA Inc.; Wi-LAN Labs Inc.; LG Electronics Inc.; LG Electronics USA Inc.; LG Electronics Mobilecomm USA Inc.

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