Federal Circuit issues first stay in IPR hearing

The US Court of Appeals for the Federal Circuit has issued the first stay in an inter partes review (IPR) proceeding in a dispute between Apple and VirnetX.

In a decision handed down yesterday, March 7, the court granted the stay following VirnetX’s claim that Apple should be time-barred from joining a challenge to two VirnetX patents.

Last month, the US District Court for the Eastern District of Texas said Apple had infringed two VirnetX-owned patents that are currently being reviewed by the Patent Trial and Appeal Board (PTAB) and fined Apple $625 million.

Hedge fund firm Mangrove Partner filed the IPR at the PTAB last year challenging VirnetX’s patents. The IPR was instituted in October.

However, VirnetX said the process had been improperly handled by the PTAB after it allowed Apple to join the hedge fund’s petition.

In a writ of mandamus filed at the federal circuit on March 4, VirnetX said Apple should be time-barred from joining the dispute, because VirnetX had filed the original patent claim at the district court in 2010.

Under US law, a party cannot file an IPR petition more than one year after a claim at a district court is filed.

An exemption does exist for parties seeking a “request for joinder” status, which means participating in an already instituted IPR.

But VirnetX said the PTAB’s acceptance of Apple’s request for joinder was an improper interpretation of the exemption.

It added that allowing such a development would create a “backdoor for time-barred petitions to be instituted through joinder irrespective of how much time has passed”.

Apple has attempted to knock out the patents before.

In 2013, its IPRs against the patents were dismissed because they were filed too late, and attempts to join IPR challenges filed by Microsoft and RPX Corporation also fell through because they were time-barred.

The federal circuit has ordered Apple and Mangrove to respond to VirnetX’s claims by March 14 and has stayed the PTAB case.