Apple : IPR Petitioner Lacks Standing To Appeal In Light Of Settlement And License Agreement

Apple Inc. v. Qualcomm Inc., No. 20-1561 (Fed. Cir. April 7, 2021)

Petitioner Apple Inc. appealed the Patent Trial and Appeal Board's inter partes reviews holding that Apple did not prove invalid certain patent claims covering smartphone technology. Apple challenged the patents at issue with the Board after Qualcomm sued for infringement. Apple appealed the Board's decision despite a 2019 agreement in which Apple and Qualcomm agreed to settle all litigation between the two companies worldwide. The settlement between the parties also included a six-year license agreement whereby Apple was to pay royalties to license tens of thousands of Qualcomm's patents, including those at issue. 

The Federal Circuit did not reach the merits of Apple's patent challenges.  Instead, the panel analyzed Qualcomm's argument that Apple lacked standing to appeal.  The panel noted that to establish standing under Article III, an appellant must have "must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the [appellee], and (3) that is likely to be redressed by a favorable judicial decision."  The panel also noted that "Article III standing is not necessarily a requirement to appear before an administrative agency" such as the Patent Office. 

Ultimately, the Federal Circuit dismissed the appeal and rejected Apple's three arguments for establishing standing.  The panel dismissed Apple's attempt to rely upon the Supreme Court's MedImmune opinion to establish standing, because Apple, unlike in MedImmune, did not allege that the validity of the patents at issue would affect its contract rights (i.e., its ongoing royalty obligations for the tens of thousands of licensed Qualcomm patents).  The panel also rejected Apple's argument that it had standing based on the mere possibility that Qualcomm could sue for infringements for two of the patents at issue once the settlement license expired, stating that the argument was "too speculative to confer standing."  Finally, the panel rejected Apple's argument that "its injury is compounded by the likelihood that 35 U.S.C. § 315(e) would estop it from arguing that the '037 patent and '362 patent would have been obvious in future disputes."  The panel noted that "Apple's harm is particularly suspect because it has failed to show it will likely be engaging in activities that could give rise to a potential suit based on the '037 and '362 patents after the expiration of the license agreement."  Citing to precedent, the panel stated that "[w]e have already rejected invocation of the estoppel provision as a sufficient basis for standing."

 Read the Federal Circuit's opinion here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Ms Cesie C Alvarez
Winston & Strawn LLP
35 West Wacker Drive
Chicago
IL 60601
UNITED STATES
Tel: [phone]
Fax: [phone]
E-mail: [e-mail]
URL: www.winston.com

© Mondaq Ltd, 2021 - Tel. [phone] - http://www.mondaq.com, source Business Briefing