Court Opinion

ID: 4279692
Source: CourtListenerOpinion
Date Created: 2018-05-30 20:01:46.308015+00
Date Added: 2024-06-11T14:34:37.660752
License: Public Domain

NOTE: This order is nonprecedential.

  United States Court of Appeals
      for the Federal Circuit
                 ______________________

              POLARIS INDUSTRIES INC.,
                      Appellant

                           v.

                  ARCTIC CAT, INC.,
                      Appellee

    ANDREI IANCU, UNDER SECRETARY OF
  COMMERCE FOR INTELLECTUAL PROPERTY
   AND DIRECTOR OF THE UNITED STATES
     PATENT AND TRADEMARK OFFICE,
                  Intervenor
            ______________________

                  2017-1870, 2017-1871
                 ______________________

   Appeals from the United States Patent and Trade-
mark Office, Patent Trial and Appeal Board in
Nos. IPR2015-01781, IPR2015-01783.
               ______________________

                     ON MOTION
                 ______________________

PER CURIAM.
                      ORDER
2                      POLARIS INDUS. INC.   v. ARCTIC CAT, INC.

    Polaris Industries Inc. appeals from two final written
decisions of the U.S. Patent and Trademark Office’s
Patent Trial and Appeal Board holding certain claims of
its U.S. Patent No. 8,827,028 unpatentable. When the
Board instituted the inter partes reviews (“IPR”), it
declined to institute review of additional claims and
grounds of unpatentability that Arctic Cat, Inc. had
included in its IPR petitions. Thus, the Board’s final
written decisions do not address the noninstituted claims
and grounds. Following the Supreme Court’s decision in
SAS Institute Inc. v. Iancu, 584 U.S. __, 138 S. Ct. 1348
(2018), Polaris moved to terminate these appeals and
remand to allow the Board to address the noninstituted
claims and grounds. For the reasons that follow, we grant
the motion.
                       BACKGROUND
     Arctic Cat filed two IPRs challenging the ’028 patent,
which describes and claims all-terrain vehicles. The
Board instituted review of a subset of the challenged
claims on some of the proposed grounds of unpatentabil-
ity.
    The Board held each instituted claim unpatentable,
and Polaris appealed. Among other things, Polaris ar-
gued on appeal that the Board erred because its analysis
in its final written decisions conflicted with the rationale
in its institution decisions. After the parties submitted
their appeal briefs, the Supreme Court issued its opinion
in SAS, holding that “the Board must address every claim
the petitioner has challenged” in its final written deci-
sions. SAS, 138 S. Ct. at 1354. In view of SAS, Polaris
moved to terminate the appeals and remand the IPRs. In
response, Arctic Cat argued that patent owners lack the
right to request remand following SAS, and that regard-
less, Polaris waived its right to argue against partial
institution by failing to preserve the argument. The PTO
intervened to argue that both patent owners and petition-
POLARIS INDUS. INC.   v. ARCTIC CAT, INC.                  3

ers have the right to seek remand following SAS but that
Polaris waived that right by not preserving the issue in
its briefing before the Board.
                           DISCUSSION
    We conclude that Polaris may request a remand to al-
low the Board to consider noninstituted claims and
grounds. A patent owner has an interest in obtaining a
final written decision that addresses all challenged claims
and resolves all questions of patentability that might
otherwise cloud the perceived validity of its patent. And
further, a patent owner benefits from complete decisions
because following a final written decision on a claim, the
petitioner, its real-parties-in-interest, and those in privity
with the petitioner are largely barred from challenging
that claim’s validity. See 35 U.S.C. § 315(e). We conclude
that Polaris may seek remand to obtain these benefits
because the Board’s existing final written decisions do not
address all challenged claims or all grounds. Arctic Cat’s
contrary arguments do not persuade us otherwise.
    We further conclude that Polaris did not waive its
right to seek remand by not arguing against partial
institution before the Board. Precedent holds that a party
does not waive an argument that arises from a significant
change in law during the pendency of an appeal. See, e.g.,
Hormel v. Helvering, 312 U.S. 552, 558–59 (1941) (holding
an exception to the waiver rule exists in “those [cases] in
which there have been judicial interpretations of existing
law after decision below and pending appeal—
interpretations which if applied might have materially
altered the result”); accord In re Micron Tech., Inc.,
875 F.3d 1091, 1097 (Fed. Cir. 2017) (acknowledging that
“a sufficiently sharp change of law sometimes is a ground
for permitting a party to advance a position that it did not
advance earlier in the proceeding when the law at the
time was strongly enough against that position”); Hilton
Davis Chem. Co. v. Warner-Jenkinson Co., 114 F.3d 1161,
4                      POLARIS INDUS. INC.   v. ARCTIC CAT, INC.

1164 (Fed. Cir. 1997) (on remand from Supreme Court,
holding that “[g]iven the change in law, it would be unfair
at this stage of the case to apply Hilton Davis’ statements
against it or estop it from augmenting the record to show
the reason for the claim amendment based on other facts
that may be available”). Prior to the Supreme Court’s
decision in SAS, any attempt to argue against partial
institution would have been futile under the Board’s
regulations and our precedent.         See, e.g., 37 C.F.R.
§ 42.108 (permitting partial institution); Synopsys, Inc. v.
Mentor Graphics Corp., 814 F.3d 1309, 1315 (Fed. Cir.
2016) (“[T]he statute is quite clear that the PTO can
choose whether to institute inter partes review on a claim-
by-claim basis.”).     Polaris’s failure to challenge the
Board’s partial institution before the Supreme Court’s
issuance of SAS is therefore excused.
    After considering the parties’ arguments and the cir-
cumstances in this case, we conclude that remand is
warranted. 1 Polaris based many of its contentions on
appeal on alleged inconsistencies in the Board’s treatment
of U.S. Patent No. 3,407,893 (“Hill”) in its institution
decisions versus its final written decisions. Though we
express no opinion on the merits of Polaris’s contentions,
we find it appropriate in this case to allow the Board to
consider the noninstituted claims and grounds, which
may resolve the alleged inconsistencies.
    We thus remand these IPRs to allow the Board to con-
sider the noninstituted portions of Arctic Cat’s petitions.
On remand, the Board need not reconsider issues already
addressed in its final written decisions unless, in the
course of considering the noninstituted claims and
grounds, it finds it necessary to do so.

    1   Because we do not exercise jurisdiction over these
appeals, we need not address Polaris’s arguments regard-
ing jurisdiction.
POLARIS INDUS. INC.   v. ARCTIC CAT, INC.                     5

    IT IS ORDERED THAT:
    These appeals are terminated and these IPRs are re-
manded to the Board for proceedings consistent with this
order.

                                   FOR THE COURT

   May 30, 2018                    /s/ Peter R. Marksteiner
      Date                         Peter R. Marksteiner
                                   Clerk of Court