Ironburg Inventions Ltd. v. Valve Corporation

District Court, W.D. Washington·Decided May 3, 2024·No. 2:17-cv-01182·Unknown

Opinion

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3 UNITED STATES DISTRICT COURT 4 WESTERN DISTRICT OF WASHINGTON AT SEATTLE 5 IRONBURG INVENTIONS LTD., 6 Plaintiff, 7 C17-1182 TSZ v. 8 ORDER VALVE CORPORATION, 9 Defendant. 10 11 THIS MATTER comes before the Court on plaintiff’s renewed motion for inter 12 partes review (“IPR”) estoppel, docket no. 513, and defendant’s cross-motion for a 13 finding of no IPR estoppel, docket no. 528. Having reviewed all papers filed in support 14 of, and in opposition to, each motion, the Court enters the following order. 15 Discussion 16 Plaintiff Ironburg Inventions Ltd. (“Ironburg”) owns United States Patent 17 No. 8,641,525 B2 (“’525 Patent”), a copy of which is attached as Exhibit A, docket 18 no. 44-1, to the Second Amended Complaint. The invention described in the ’525 Patent 19 is “a hand held controller for a game console.” See ’525 Patent at 4:41 & 6:14. During 20 the period from June 2015 through December 2019, defendant Valve Corporation 21 (“Valve”) sold approximately 1,612,136 devices known as the “Steam Controller.” See 22 Stip. Facts Nos. 7 & 10–11, Jury Instr. No. 5 (docket no. 413). On February 1, 2021, a 1 Controller, Valve had willfully infringed Claims 2, 4, 7, 9, 10, 11, and 18 of the ’525 2 Patent. See Verdict (docket nos. 416 & 417). The jury awarded to Ironburg

3 $4,029,533.93 in damages. Id. By Order entered May 26, 2021, docket no. 458, the 4 Court denied Valve’s motion for judgment as a matter of law (“JMOL”), remittitur, or a 5 new trial; the Court also denied Ironburg’s motion for enhanced damages. On appeal, the 6 Federal Circuit affirmed all but one of the Court’s numerous rulings in this case. See 7 Ironburg Inventions Ltd. v. Valve Corp., 64 F.4th 1274 (Fed. Cir. 2023). 8 The only decision of this Court that was vacated by the Federal Circuit involved

9 the effect of Valve’s failure to raise, in an IPR petition dated April 22, 2016, see Ex. C to 10 Becker Decl. (docket no. 262-3), the following grounds for challenging the validity of the 11 ’525 Patent: 12 Non-Petitioned Grounds Relevant Patent Claims1 Prior Art References 13 2, 9–11, and 18 Kotkin2 14 2, 4, 7, and 9–11 Willner,3 Koji,4 and Raymond5 15 See Ironburg, 64 F.4th at 1296 n.7 & 1297–1300; see also Order at 5 (docket no. 320). 16 The IPR that Valve sought in April 2016, on different grounds, was instituted in part on 17 18 1 In its response to Ironburg’s original motion for IPR estoppel, Valve asserted obviousness on the basis of Kotkin as to Claims 1–3, 5, 6, 9–11, 14, 17–18, and 20 of the ’525 Patent, and it 19 asserted obviousness on the basis of Willner, Koji, and Raymond as to Claims 1, 2, 4–11, 13, 17, and 19–20 of the ’525 Patent. See Def.’s Resp. at 1 (docket no. 276). These lists of patent 20 claims have been narrowed to reflect the claims on which the jury found infringement. 2 United States Patent Application Publication No. 2010/0298053 A1 filed by David Kotkin. 21 3 United States Patent No. 6,760,013 B2 issued to Michael Willner and Scott Arnel. 22 4 Japanese Patent Application No. JP-A H10-020951 filed by Koji Tsuchiya. 1 September 27, 2016, as IPR2016-00948 (“948 IPR”), see Ex. E to Becker Decl. (docket 2 no. 262-5), and decided almost a year later, on September 22, 2017, by the Patent Trial

3 and Appeal Board (“PTAB”), see Ex. K to Becker Decl. (docket no. 262-11) (concluding 4 that Claims 1, 6, 13, 14, 16, 17, 19, and 20 of the ’525 Patent are unpatentable). 5 A. Collective Minds 6 In January 2018, while the cross-appeals concerning the 948 IPR were pending 7 before the Federal Circuit, another entity, Collective Minds Gaming Co. Ltd. (“Collective 8 Minds”), petitioned for inter partes review, raising both Kotkin and the combination of

9 Willner, Koji, and Raymond as grounds for declaring certain claims of the ’525 Patent 10 invalid, including some of the claims already found unpatentable by the PTAB in the 11 948 IPR. See Pet. for Inter Partes Review, Collective Minds Gaming Co. v. Ironburg 12 Inventions Ltd., No. IPR2018-00354, 2018 WL 280722 (Jan. 3, 2018). The PTAB 13 instituted the requested IPR, but it never ruled on the merits of the obviousness

14 challenges presented by Collective Minds because the parties reached a settlement. See 15 Collective Minds Gaming Co. v. Ironburg Inventions Ltd., No. IPR2018-00354, 2018 WL 16 2938858 (P.T.A.B. June 7, 2018); see also Collective Minds Gaming Co. v. Ironburg 17 Inventions, Ltd., Nos. IPR2018-00354, -00355, -00356 & -00357, 2018 WL 6624854 18 (P.T.A.B. Dec. 14, 2018). These events occurred more than six months before the

19 Federal Circuit, shortly after hearing oral argument, affirmed the PTAB’s decision in the 20 948 IPR. See Ex. A to Joint Status Report (docket no. 302-1) (containing a copy of the 21 Federal Circuit’s two-page judgment dated July 15, 2019). 22 1 As observed in this Court’s previous Order concerning IPR estoppel, docket 2 no. 320, Valve’s petition for the 948 IPR predated SAS Institute, Inc. v. Iancu, 138 S. Ct.

3 1348 (2018), in which the Supreme Court invalidated the PTAB’s former practice of 4 instituting inter partes review as to less than all of the claims in an IPR petition. Because 5 Valve’s requested IPR had been instituted in part and not instituted in part, Valve could 6 have, but did not seek, a post-SAS remand to the PTAB. See Order at 8–9 (docket 7 no. 320) (citing Google LLC v. Lee, 759 Fed. App’x 998 (Fed. Cir. 2019), and SiOnyx, 8 LLC v. Hamamatsu Photonics K.K., 330 F. Supp. 3d 574 (D. Mass. 2018)). This Court

9 therefore imposed IPR estoppel with respect to the non-instituted grounds, and the 10 Federal Circuit affirmed this decision. See Ironburg, 64 F.4th at 1297. The Court now 11 notes that, if Valve had requested a post-SAS remand, it could have sought further relief 12 from the PTAB, including consolidation of the two IPR proceedings initiated by Valve 13 and Collective Minds, respectively, involving the same patent. See 35 U.S.C. § 315(d);

14 37 C.F.R. § 42.122. 15 The Court did not, however, make this observation in its prior ruling. Instead, in 16 reaching its earlier decision, the Court viewed Collective Minds’ IPR petition as evidence 17 that, during the timeframe when Valve was motivated to learn of references that might 18 have rendered the ’525 Patent invalid, a skilled searcher reasonably could have been

19 expected to discover Kotkin and the combination of Willner, Koji, and Raymond. See 20 Order at 11–13 (docket no. 320). As a result, pursuant to 35 U.S.C. § 315(e)(2),6 the 21 22 6 The cited statute provides in relevant part as follows: “The petitioner in an inter partes review of a claim in a patent under this chapter that results in a final written decision . . . may not assert 1 Court concluded that Valve was estopped from raising the non-petitioned grounds as 2 defenses at trial. Order at 13 (docket no. 320). On appeal, the Federal Circuit agreed

3 with this Court that, 4 provided the other conditions of the statute are satisfied, § 315(e)(2) estops a petitioner as to invalidity grounds a skilled searcher conducting a diligent 5 search reasonably could have been expected to discover, as these are grounds that the petitioner “reasonably could have raised” in its petition. 6 64 F.4th at 1298; compare Order at 10 (docket no.

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