Global Equity Management (GEMSA) v. Ebay Inc., Alibaba.com, Booking.com
Docket No. 2019-1304, -1304 (IPR Nos. 2016-01828, -01829)
WALLACH, CLEVENGER, STOLL
January 14, 2020
Brief Summary: Board decision not to dismiss affirmed since “GEMSA did not meet its burden to ‘produce some evidence that tends to show that [Amazon] should be named a” RPI.
Summary: GEMSA appealed PTAB (“Board”) denial of its motions to terminate IPRs regarding US 6,690,400 and 7,356,677 (the Challenged Patents) pursuant to 35 USC § 315(a)(1) (2012) (“[IPR] may not be instituted if…the petitioner or real party in interest [RPI] filed a civil action challenging the validity of a claim” before filing the IPR petition) and 37 CFR § 42.8(b)(1) (2018) (PTAB must be notified of each RPI) based on an alleged failure to identify the RPI (the Board’s invalidity findings were not challenged). The FC panel opinion explains that during 2015-2016 GEMSA filed nearly 40 infringement suits against wholly-owned subsidiaries of Amazon.com as well as “entities-including the Petitioners-that were not Amazon customers” (GEMSA admitting that the Petitioners were “not using” Amazon’s technology). Amazon filed a declaratory judgment (DJ) action in VA in July 2016 and then a motion to dismiss or transfer the TX suits to VA, arguing that Amazon is the RPI. In September 2016, Ebay et al. (“Petitioners”) petitioned for IPR of the Challenged Patents, identifying 17 RPIs, some of which had been sued by GEMSA in TX, but did not name Amazon as an RPI. This appeal relates to the Board’s denial of GEMSA’s argument that the IPRs should be dismissed because Amazon was not listed as an RPI. The Board denied GEMSA’s request because neither Expedia or TripAdvisor (two of the Petitioners) “filed a civil action challenging the validity of a claim” (§ 315(a)(1)). The FC panel explained that “[o]n appeal, GEMSA argues-for the first time-that the IPR proceedings should be terminated pursuant to 35 USC § 315(a)(1) because Amazon, which GEMSA argues is an RPI to the IPR proceedings” filed the DJ action in VA “before the IPR petitions were filed”. The FC panel disagreed with GEMSA’s argument because GEMSA had not raised this particular argument to the Board, but also because “GEMSA did not meet its initial burden…to ‘produce some evidence that tends to show that [Amazon] should be named a” RPI to the IPR proceedings (“GEMSA’s mere assertion…is insufficient to properly preserve that argument”) (Game & Tech., FC 2019; SmithKline, FC 2006). Further, the FC panel wrote, “[e]ven if not waived”, it was not convinced by GEMSA’s argument because, e.g., “‘there are no facts’ in the record ‘that Amazon actually wrote the IPR [petitions] or controlled the IPR [proceedings]’”, “GEMSA acknowledged Amazon’s ‘only…potential’ relationship” with Petitioners, and “the plain language of Amazon’s indemnification agreement with Expedia does not permit Amazon to control or otherwise participate in the IPR proceedings”. And since “GEMSA did not meet its burden to ‘produce some evidence that tends to show that [Amazon] should be named a” RPI, the Board decision was affirmed.