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General Plastic Industrial Co., Ltd. v. Canon Kabushiki Kaisha

Paper No. 19, September 6, 2017

IPR2016-01357 (Patent 9,046,820 B1)


This decision denying requests for rehearing did not join or consolidate the five proceedings involving two patents; rather, owing to the presence of common issues and the involvement of the same parties, the PTAB entered a single Decision on Rehearing. See Paper 19, p.1. General Plastic filed five Requests for Rehearing of each of five Decisions Denying Institution of inter partes review. Id. at p.2. General Plastic contended that the five Decisions Denying Institution should be withdrawn and inter partes review should be instituted. Id. General Plastic also requested that the rehearing panel be expanded. Id.

General Plastic had filed “a first set of petitions seeking inter partes review of U.S. Patent No. 9,046,820 B1 (‘the ‘820 patent’) and U.S. Patent No. 8,909,094 B2 (‘the ‘094 patent’).” Id. Institution of a trial was denied on the merits for each petition. Id. Nine months after filing the first set of petitions, General Plastic filed follow-on petitions against the same patents, which the PTO declined to institute. Id. at p.2-3. “[General Plastic] allege[d] that trials should have been instituted on the follow-on petitions because a petitioner is not limited to filing just one petition per challenged patent under either 35 U.S.C. § 311 or § 314.” Id. at p.3. General Plastic also argued that the PTO should not have relied on § 314(a) because according to General Plastic, that provision does not apply to later petitions, and § 325(d) should have been used instead. Id. General Plastic further alleged that the Board misapplied the NVIDIA factors, specifically: “(1) the factor of the limited one-year time period for issuing a final written decision should be afforded additional, if not dispositive, weight in light of the legislative history; (2) [the PTO] abused [its] discretion by requiring that the prior art ‘should have been known’ at the time the initial petitions were filed; and (3) [the PTO] erred in considering the potential prejudice to [Canon] because the NVIDIA decision does not list such a factor.” Id.


General Plastic did not demonstrate that the PTO abused its discretion or that it misapprehended or overlooked any issue in denying institute of inter partes review in the five follow-on cases. See Paper 19, p.22. General Plastic’s request for an expanded panel was granted, and its Requests for Rehearing were denied in all other respects. Id.


The first issue the PTAB discussed was General Plastic’s request for an expanded panel. See Paper 19, p.4. The PTAB noted that its “governing statutes and regulations do not permit parties to request, or panels to authorize, an expanded panel.” Id. The PTAB’s standard operating procedure grants the Chief Judge the discretion to listen to requests to consider expanding a panel and to expand a panel to include more than three judges. Id. The PTAB’s standard operating procedure gives some examples of when a panel expansion might be warranted, including when a case “involves issues of exceptional importance.” Id. The Chief Judge determined an expanded panel was “warranted to provide a discussion of factors that are considered in the exercise of the Board’s discretion under 35 U.S.C. § 314(a) and 37 C.F.R. § 42.108(a). Id. at p.5.

The PTAB reviewed the Decisions on Rehearing for abuse of discretion. Id. For background, the PTAB explained that the ‘820 and ‘094 patents “generally relate to toner supply containers used within image forming apparatuses.” Id. at p.6. The claims challenged in General Plastic’s petitions were very similar, and the PTO declined to institute inter partes review on the first two petitions. Id. General Plastic then filed two follow-on petitions challenging claims of the ‘820 patent and three follow-on petitions challenging claims of the ‘094 patent. Id. at p.7-8. Canon responded by arguing that the PTAB should apply the NVIDIA factors and deny the Petitions pursuant to 35 U.S.C. § 314(a). Id. at p.8.

The PTAB explained that it considered the seven NVIDIA factors when it opted to deny the follow-on petitions. Id. The factors are:

  1. Whether the same petitioner previously filed a petition directed to the same claims of the same patent;
  2. Whether at the time of filing of the first petition, the petitioner knew of the prior art asserted in the second petition or should have known of it;
  3. Whether at the time of filing of the second petition the petitioner already received the patent owner’s preliminary response to the first petition or received the Board’s decision on whether to institute review in the first petition;
  4. The length of time that elapsed between the time the petitioner learned of the prior art asserted in the second petition and the filing of the second petition;
  5. Whether the petitioner provides adequate explanation for the time elapsed between the filings of multiple petitions directed to the same claims of the same patent;
  6. The finite resources of the Board; and
  7. The requirement under 35 U.S.C. 316(a)(11) to issue a final determination not later than 1 year after the date on which the Director notices institution of review. Id. at p.9-10.

“Applying these factors to the follow-on petitions, [the PTAB] concluded that the circumstances did not warrant institution of inter partes review.” Id. at p.10. “[T]he same claims of the same patent were at issue in the follow-on petitions as in the first-filed petitions, where institutions were denied.” Id. “The follow-on petitions were all filed nine months after the filing of the first-filed petitions,” and at that time, General Plastic had heard from the Board that institution and rehearing of the first-filed petitions were denied. Id. General Plastic gave no meaningful explanation for the delay in filing the follow-on petitions. Id. General Plastic did not begin new prior art searches until after the first-filed petitions had been denied institution and rehearing. Id. The PTAB found that its “resources would be more fairly expanded on initial petitions, rather than follow-on petitions,” and that General Plastic had given no reason behind what prompted the new prior art searches or why it could not have found this prior art earlier. Id. at p.10-11. The PTAB also noted that General Plastic filed the follow-on petitions with the intent of curing specific deficiencies in the initial petitions, a tactic which the PTAB frowned upon as being inequitable to Canon. Id. at p.11.

General Plastic argued that the PTAB had created an improper de facto bar against follow-on petitions, that the PTAB’s decision not to institute proceedings on the follow-on petitions was an abuse of discretion, that more specific statutory language (§ 325(d)) should have been controlling, that § 314(a) conflicts improperly with § 325(d), that denial of a first-filed petition “should not be fatal,” and that the NVIDIA factors do not require taking unfair prejudice to the patent owner into account. Id. at p.12-14. The PTAB determined that General Plastic had not shown that the PTAB’s Decisions Denying Institution of inter partes review “misapprehended or overlooked any matter of that [the PTAB] abused [its] discretion in reaching this determination.” Id. at p.15.

PRECEDENTIAL – “The Director has discretion to institute an inter partes review under 35 U.S.C. § 314(a) and 37 C.F.R. § 42.108(a).” Id. “There is no per se rule precluding the filing of follow-on petitions after the Board’s denial of one or more first-filed petitions on the same patent.” Id. The seven NVIDIA factors are not an exhaustive list of what the PTAB considers in determining whether to institute or deny institution based on a follow-on petition. Id. at p.16. The PTAB’s exercise of discretion was consistent with the goals of the AIA, in particular “to improve patent quality and make the patent system more efficient by the use of post-grant review procedures.” Id. The PTAB also recognized “the potential for abuse of the review process by repeated attacks on patents.” Id. at p.17. “The absence of any restrictions on follow-on petitions would allow petitioners the opportunity to strategically stage their prior art and arguments in multiple petitions, using [the PTAB] decisions as a roadmap, until a ground is found that results in the grant of review.” Id. This strategy would be unfair to patent owners and “an inefficient use of the inter partes review process and other post-grant review processes.” Id. at p.17-18. The PTAB conceded that there might be circumstances “where multiple petitions by the same petitioner against the same claims of a patent should be permitted,” and each situation is dependent on the facts at issue in the case. Id. at p.18. The NVIDIA factors are meant to act as a baseline of what factors should be considered when evaluating follow-on petitions. Id. § 314(a) discussed when inter partes review may not be instituted, but it does not give a set list of time when it must be instituted. Id. at p.18-19. Similar permissive language, granting the Director discretion regarding institution, is also found in § 325(d), and the PTAB declines to read limitations into the statute where they do not exist. Id. at p.19. – PRECEDENTIAL

The PTAB summarized its findings, concluding that six of the seven NVIDIA factors weighed against institution. The PTAB noted that General Plastic failed to give reasoning for the nine month delay or why it did not conduct a prior art search until after the initial petitions were denied. Id. at p.19-20. Ultimately, the PTAB found that General Plastic’s arguments were not persuasive. Id. at p.21.


A copy of the PTAB order can be found here.