Proppant Express v. Oren Technologies (IPR2017-01917): Adding Real Parties in Interest after Institution

Proppant Express Investments, LLC v. Oren Technologies, LLC, IPR2017-01917 (Paper 86, February 13, 2019), answers a practical question: can a petitioner add real parties in interest (RPIs) after trial has begun without losing its filing date? The Board said yes on these facts and denied the patent owner’s motion to terminate. The Board designated this order precedential. Designations can change, so check the USPTO’s current list of precedential and informative decisions.

The parties were involved in several related proceedings on Oren’s patents. A separate note covers a joinder decision in one of them, Proppant Express v. Oren, IPR2018-00914.

Background

At institution in February 2018, the Board rejected the patent owner’s argument that a company called Liberty Oilfield Services was an unnamed RPI. The patent owner later argued instead that Big Box Proppant Investments, a member of the petitioner entities, was an unnamed RPI.

The law then shifted. In July 2018 the Federal Circuit decided Applications in Internet Time, LLC v. RPX Corp., holding that the Board had applied too narrow an understanding of “real party in interest” and calling for a flexible approach focused on whether a nonparty is a clear beneficiary with a preexisting, established relationship with the petitioner. In September 2018 Worlds Inc. v. Bungie, Inc. weakened the presumption that a petitioner’s RPI identification is correct. In a related case the Board then raised, on its own, evidence suggesting Liberty might be an RPI.

The petitioner promptly asked to update its notices in all pending proceedings between the parties. With the Board’s authorization, on September 19, 2018, it named Liberty and Big Box as RPIs “without admitting” that they were, and stated that both agreed to be bound by the estoppel of 35 U.S.C. § 315(e). The patent owner moved to terminate, arguing that the updated petition needed a new filing date, which would fall outside the one-year bar of § 315(b).

What the Board decided

The Board first held it had authority to accept updated notices after institution. Section 312(a) is not jurisdictional, as held in Lumentum v. Capella. And in Wi-Fi One, LLC v. Broadcom Corp. (Fed. Cir. 2018) (en banc), the Federal Circuit distinguished § 312(a)(2) from the § 315(b) time bar and noted the Director can allow a petitioner to add an RPI. The key limit is that the petition must not have been time-barred had it named the added party at filing. Here, none of the added parties had been served with a complaint more than a year before the petition.

The Board then applied four considerations earlier panels had used:

• Circumventing the time bar or estoppel. None; no added party was barred, and no one alleged evasion of estoppel.
• Bad faith. None shown; the patent owner offered no specific facts.
• Prejudice from delay. The cost of litigating a hard-fought, good-faith RPI dispute was not the kind of prejudice that warrants termination, and alleged harm in a separate district court contract dispute was speculative and outside the proceeding.
• Gamesmanship. The timing reflected a change in the law and the Board’s own new signals, not strategy. Naming parties without conceding RPI status was acceptable because it served the core purposes of the requirement: identifying conflicts and applying estoppel.

Finding it in the interests of justice, the Board allowed the update with the original filing date.

Why it matters

The order sets out a workable framework for RPI corrections: confirm no time bar would have applied to the added party, then address bad faith, prejudice and gamesmanship. It contrasts sharply with the earlier approach in Reflectix v. Promethean, where an omission led to a new filing date and a time bar. It also shows the value of acting promptly once an RPI issue surfaces. For background, see who is the real party in interest.

Key takeaways

• The Board allowed a petitioner to add RPIs after institution without losing its original filing date.
• The threshold question is whether the petition would have been time-barred had the added party been named at filing.
• The Board weighed time-bar or estoppel evasion, bad faith, prejudice and gamesmanship.
• Naming parties “without admitting” RPI status, with an agreement to be bound by estoppel, was acceptable.