Garmin Seals Win in First Inter Partes Review Decision

, The Litigation Daily

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The Patent Trial and Appeal Board has sided with Garmin International Inc. and invalidated three challenged claims in a patent held by Cuozzo Speed Technologies LLC, marking the first inter partes review decision to be issued since the new patent challenge proceeding was instituted under the America Invents Act.

Cuozzo Speed sued Garmin in June 2012 in New Jersey District Court, claiming that Garmin infringed a patent that ties a speed-limit indicator to a GPS system so that a driver is signaled when the car is exceeding the speed limit.

Garmin responded with a request for an inter partes review at the U.S. patent office —a proceeding created under the 2011 patent reform legislation known as the America Invents Act. Similar to the reexaminations that previously took place at the PTO, IPRs are appealing because they must be completed within one year, are less expensive than proceedings in district court, and require a lower burden of proof. Garmin filed its IPR petition on Sept. 16, 2012—the first day such filings were permitted.

The decision by the PTAB’s three administrative patent judges—Jameson Lee, Michael Tierney and Josiah Cocks—fully supported Garmin’s argument, which was based on obviousness in light of combinations of prior art. But the board addressed only three of the 20 claims the company challenged in its initial IPR petition. Parallel litigation before District Court Judge Joseph Dickson can proceed on the other claims.

Garmin filed another IPR petition in June on the same patent based on the board’s claim construction in the first case. The board has not yet ruled on whether it will hear the second challenge.

Jennifer Bailey, who was at Hovey Williams when she argued for Garmin but recently moved to the Kansas City intellectual property firm Erise IP, said she is not authorized to speak about the case since there is pending litigation. And John Kasha of the Potomac, Maryland-based IP firm Kasha Law, who represented Cuozzo, was unavailable for comment.

Nevertheless, the ruling is garnering much interest among patent lawyers, who have flocked to the PTAB to challenge patents since IPR proceedings began—especially when combatting non-practicing entities often referred to as patent trolls. (Garmin has called Cuozzo, which acquired the challenged patent and has asserted it against Chrysler, General Motors and others, a patent troll.) The PTAB now has the third busiest docket for patent cases, behind the district courts of Delaware and Texas. As of November 7, attorneys had filed 627 IPR petitions since the PTAB began accepting them.

Eleanor Yost, an IP attorney at Goodwin Proctor who specializes in the PTO’s post-grant proceedings, said this case was noteworthy not only because it was the first IPR but also because the judges accepted Garmin’s prior art, which combined multiple references to different pieces of prior art that spanned 30 years. "Complex combinations of three and four references rarely win in district court," she said. "This signals the board’s willingness to handle complex invalidity arguments and invalidate claims in a way that might not work in district court."

The PTAB is also likely to attract more cases because the burden of proof to invalidate claims in an IPR is a preponderance of evidence, as opposed to the higher "clear and convincing" standard that exists in district court, Yost noted. The PTAB may also be more appealing to defendants wishing to invalidate a patent because rather than putting a case before a jury, they are being heard by judges who are technically trained and understand patent law.

A ruling by the PTAB can be appealed to the Federal Circuit.

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