Serial Loser Wins Chance to Lose Again

Loser of numerous IPR proceedings gets chance to argue against dismissal of ex parte reexamination

In 2015, Vivint sued Alarm.com for infringement of several patents. Alarm.com then marched into the U.S. Patent and Trademark Office (USPTO) and filed eighteen (18) inter partes review (IPR) petitions against Vivint's patents. A number of those decisions were unfavorable to Alarm.com, and Alarm.com appealed to the Federal Circuit (who denied the appeals). Undeterred, Alarm.com went to back to the USPTO to ask for ex parte reexaminations of Vivint’s patents.

The USPTO vacated a number of Alarm.com's ex parte reexaminations as being estopped under 35 U.S.C. § 315(e)(1). Faced with dismissal of the reexaminations due to estoppel, Alarm.com filed a complaint under the Administrative Procedure Act (APA) asking the United States District Court for the Eastern District of Virginia to review the dismissals. The district court dismissed the complaint, reasoning that the overall ex parte reexamination scheme precludes judicial review of the vacatur decisions based on 35 U.S.C. § 315(e)(1) estoppel, based on 35 U.S.C. § 303(c) which denies review of determinations of a “substantial new question of patentability.” Alarm.com appealed.

The Federal Circuit held that 35 U.S.C. § 303(c) is limited to only determinations of a “substantial new question of patentability.” Because the estoppel decision did not address whether there was a substantial new question of patentability, the Federal Circuit held that Alarm.com’s APA challenge to the estoppel decisions should have been reviewed on the merits. So, Alarm.com gets a chance to explain why it thinks it should have been allowed to levy another challenge to Vivint’s patent after losing its first challenge. Notably, it has already lost one serial challenge.  Late last year, Vivint successfully obtained an order from the Federal Circuit dismissing another of Alarm.com's ex parte reexaminations. The Federal Circuit determined that it was arbitrary and capricious for the USPTO to continue a reexamination where the USPTO had earlier denied an IPR against the same patent pursuant to its discretionary denial authority under 35 U.S.C. § 325(d).

Had Alarm.com been permitted to file for inter partes review instead of ex parte reexamination, a similar vacatur decision could not be reviewed as it would have been statutorily precluded under 35 U.S.C. § 314(d).  It remains to be seen whether Congress will smooth out these differences between the availability of judicial review for different types of post grant proceedings at the USPTO.