Arris Group Inc. v. C-Cation Technologies LLC

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Trials@uspto.gov 	Paper 10
571-272-7822 	Entered: May 1, 2015
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
ARRIS GROUP, INC.,
Petitioner,
v.
C-CATION TECHNOLOGIES, LLC,
Patent Owner.
Case IPR2015-00635
Patent 5,563,883
Before MIRIAM L. QUINN, Vice Chief Administrative Patent Judge,
BARBARA A. BENOIT, and LYNNE E. PETTIGREW, Administrative
Patent Judges.
PETTIGREW, Administrative Patent Judge.
ORDER
Granting Patent Owner’s Motion for Additional Discovery
37 C.F.R. § 42.51(b)(2)
I. INTRODUCTION
Pursuant to authorization from the panel, C-Cation Technologies,
LLC (“Patent Owner”) filed a Motion for Discovery from Petitioner.
Paper 7 (“Mot.”). In its motion, Patent Owner seeks production of

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Patent 5,563,883
indemnification agreements between ARRIS Group, Inc. (“Petitioner”) and
Comcast Corporation relating to a lawsuit filed in January 2011 by Patent
Owner against Comcast, titled C-Cation Technologies, LLC v. Comcast
Corp., Case No. 2:11-cv-00030 (E.D. Tex.). Id. at 4 (citing Ex. 2001).
According to Patent Owner, it “expects that the requested discovery,
together with additional information recently obtained by Patent Owner, will
make a compelling showing” of privity between Petitioner and Comcast,
thus establishing that the Petition in this case, challenging claims 1, 3, and 4
of U.S. Patent No. 5,563,883 (“the ’883 patent”), is time-barred under 35
U.S.C. § 315(b). Id. at 4–5.
As Patent Owner indicates, it seeks the same discovery that was
requested and ordered by the Board in ARRIS Group, Inc. v. C-Cation
Technologies, LLC, Case IPR2014-00746 (PTAB July 24, 2014) (Paper 15),
involving the same parties and the same patent as this case. Mot. 2. In
IPR2014-00746, in a decision instituting inter partes review of claim 14 of
the ’883 patent, the Board determined that, based on the evidence presented
at that stage of the proceeding, § 315(b) did not bar institution of inter partes
review. ARRIS Group, Inc. v. C-Cation Techs., LLC, Case IPR2014-00746,
slip op. at 8–10 (PTAB Nov. 24, 2014) (Paper 22). Ultimately, Patent
Owner filed a statutory disclaimer of claim 14 under 35 U.S.C. § 253 and
37 C.F.R. § 1.321(a), and the Board granted Patent Owner’s request for
adverse judgment. ARRIS Group, Inc. v. C-Cation Techs., LLC, Case
IPR2014-00746 (PTAB Feb. 18, 2015) (Paper 28).
Petitioner opposes the Motion, arguing that the requested discovery is
not in the “interests of justice” because it relates to an issue that cannot be
litigated in this case. Paper 8 (“Opp.”), 8 (citing 37 C.F.R. § 42.51(b)(2)).
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In terms of the factors outlined in Garmin International, Inc. v. Cuozzo
Speed Technologies LLC, Case IPR2012-00001 (PTAB Mar. 5, 2013)
(Paper 26), Petitioner contends that “something useful will not be found by
the sought-after discovery because even if everything Patent Owner says
about the discovery is true, Patent Owner cannot relitigate the privity issue
in this proceeding.” Opp. 8. Specifically, Petitioner argues that both Board
rules and principles of administrative res judicata preclude Patent Owner
from raising the privity issue in this case. Id. at 4–8.
For the reasons discussed below, we are not persuaded by Petitioner’s
preclusion arguments, and we grant Patent Owner’s limited discovery
request.
II. DISCUSSION
A. Petitioner’s Arguments
First, Petitioner argues that Board rules prohibit Patent Owner from
raising the privity issue. Opp. 4. Specifically, Petitioner relies on 37 C.F.R.
§ 42.73(a), which provides that “[a] judgment, except in the case of a
termination, disposes of all issues that were, or by motion reasonably could
have been, raised and decided.” Petitioner argues that whether Petitioner
was in privity with Comcast in the Comcast district court litigation is an
issue that reasonably could have been raised in the earlier instituted
proceeding, and actually was raised during preliminary proceedings. Opp. 4.
We are not persuaded that 37 C.F.R. § 42.73(a) prohibits Patent
Owner from arguing that the Petition in this case is time-barred under
35 U.S.C. § 315(b) based on a privity relationship between Petitioner and
Comcast. Instead, we agree with Patent Owner that § 42.73(a) relates to the
scope of a judgment, not its preclusive effect with regard to other
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proceedings. See Paper 9 (“Reply”), 2. In other words, the rule provides
that a judgment disposes of all issues in a particular proceeding that were, or
reasonably could have been, raised and decided. Petitioner cites no authority
for its contention that the adverse judgment entered in IPR2014-00746 with
respect to claim 14 has preclusive effect beyond that proceeding.
Petitioner also argues that the common law doctrine of res judicata, or
claim preclusion, bars Patent Owner from raising the privity issue in this
case. Opp. 5–8. “Claim preclusion applies when ‘(1) the parties are
identical or in privity; (2) the first suit proceeded to a final judgment on the
merits; and (3) the second claim is based on the same set of transactional
facts as the first.’” Phillips/May Corp. v. United States, 524 F.3d 1264,
1268 (Fed. Cir. 2008) (quoting Ammex, Inc. v. United States, 334 F.3d 1052,
1055 (Fed. Cir. 2003)). “The general concept of claim preclusion is that
when a judgment is rendered in favor of a party to litigation, the plaintiff
may not thereafter maintain another action on the same ‘claim,’ and defenses
that were raised or could have been raised by the defendant in that action are
extinguished.” Foster v. Hallco Mfg. Co., 947 F.2d 469, 478 (Fed. Cir.
1991) (citing Restatement (Second) of Judgments, §§ 18, 19 & comments
(1982)) (emphasis omitted). The doctrine has been applied to the final
judgment of an administrative agency acting in a judicial capacity that has
resolved disputed issues of fact that the parties have had an adequate
opportunity to litigate. Phillips/May, 524 F.3d at 1268 (citing United States
v. Utah Constr. & Mining Co., 384 U.S. 394, 422 (1966)).
Petitioner argues that claim preclusion applies to defenses, including
Patent Owner’s “defense” of privity. Opp. 5 (citing Foster, 947 F.2d at
476). Thus, Petitioner asserts that Patent Owner’s privity argument in this
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case is identical to the one raised in IPR2014-00746, and therefore satisfies
the third element for claim preclusion—that the second claim is based on the
same set of transactional facts as the first. Id. at 6. When applying claim
preclusion to a defense, however, Foster makes clear that the defense is not
the “claim” for purposes of determining whether the second action is the
same as the first, but instead “‘claim’ is used in the sense of the facts giving
rise to the suit.” Foster, 947 F.2d at 478. In Foster, for example, a
challenge to validity in a patent infringement suit was not a “claim” but a
defense to the patentee’s “claim” of infringement. Id. at 479. Thus, after a
consent judgment in a first infringement suit, claim preclusion barred the
alleged infringer from challenging the validity of the patent as a defense in a
second infringement suit only if the two suits presented the same claim, or
cause of action, a question that turned on whether the allegedly infringing
devices in the two suit were essentially the same. Id. at 479–480.
Applying those principles to this case, we determine that claim
preclusion does not bar Patent Owner from raising the privity issue in this
case. In IPR2014-00746, the Board instituted trial and entered judgment for
only claim 14 of the ’883 patent. The Petition in this case challenges claims
1, 3, and 4, which were not part of the instituted proceeding in IPR2014-
00746, and, moreover, challenges them based on different grounds from
those asserted by Petitioner in IPR2014-00746. See Paper 2 (“Pet.”), 2–3
n.1. Thus, there is no question that the “claim,” or cause of action, in this
case—Petitioner’s challenge to claims 1, 3, and 4—is not “based on the
same set of transactional facts as the first” proceeding, IPR2014-00746.
Accordingly, the doctrine of claim preclusion does not foreclose Patent
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Owner from raising privity between Petitioner and Comcast as an issue in
this case.
B. Garmin Factors
As the Board did in IPR2014-00746, we find that Patent Owner has
shown sufficient support for its limited discovery request. Of the five
Garmin factors for determining whether additional discovery in “necessary
in the interests of justice,” Petitioner argues only the first one weighs against
granting the requested discovery. Specifically, Petitioner contends that
“something useful” will not be found because Patent Owner is foreclosed
from raising privity in this case. Opp. 8. As discussed above, we are
unpersuaded by Petitioner’s preclusion argument.
For reasons similar to those provided in IPR2014-00746, we are
persuaded that Patent Owner has set forth a threshold amount of evidence
sufficient to deem the very limited request—indemnification agreements
referencing or contingent on Petitioner’s ability to control the Comcast
litigation—necessary in the interests of justice. See ARRIS Group, Inc. v. C-
Cation Techs., LLC, Case IPR2014-00746 (PTAB July 24, 2014) (Paper 15).
Although the Board determined in the earlier institution decision that Patent
Owner had not provided, at that stage of the proceeding, evidence sufficient
to demonstrate that Petitioner exercised control or could have exercised
control as provided for in the agreements, ARRIS Group, Inc. v. C-Cation
Techs., LLC, Case IPR2014-00746, slip op. at 10 (PTAB Nov. 24, 2014)
(Paper 22), Patent Owner asserts that it recently has obtained additional
information that, together with the requested discovery, will be sufficient to
make that showing. Mot. 4–5. Under these circumstances, we are
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persuaded that Patent Owner’s limited request for production of
indemnification agreements is in the interests of justice.
III. ORDER
Accordingly, it is:
ORDERED that Petitioner shall produce:
Agreement(s) between Arris and Comcast under which
Comcast requested indemnification for the claims brought
against Comcast in the Texas Litigation1 that reference (or are
contingent on) Arris’s ability to control the litigation;
and
FURTHER ORDERED that Petitioner is authorized to file a motion
for a protective order pursuant to the guidance provided in our Order dated
April 2, 2015.
1 C-Cation Techs., LLC v. Comcast Corp., Case No. 2:11-cv-00030 (E.D.
Tex.).
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FOR PETITIONER:
Andrew R. Sommer
asommer@winston.com
Jonathan E. Retsky
jretsky@winston.com
FOR PATENT OWNER:
Lewis V. Popovski
lpopovski@kenyon.com
Jeffrey S. Ginsberg
jginsberg@kenyon.com
David J. Kaplan
djkaplan@kenyon.com
David J. Cooperberg
dcooperberg@kenyon.com
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