Federal Circuit’s Claim Construction Results in Issue Preclusion for an IPR of a Related Patent

The Federal Circuit held that its previous reversal of the Board’s claim construction resulted in issue preclusion for similar claim terms in a different IPR of a related patent.

The doctrine of collateral estoppel, also called issue preclusion, is a common law doctrine that protects a party from having to re-litigate an issue that was previously resolved adversely against a party opponent. In other words, collateral estoppel prevents a losing party from getting “two bites at the apple.”

Recently, in Nestle USA, Inc. v. Steuben Foods, Inc., Case No. 2017-1193 (Fed. Cir. Mar. 13, 2018), the Federal Circuit considered whether its construction of a claim term in an IPR appeal could result in issue preclusion for another IPR of a different, but related, patent. As discussed below, the court held that, where there is not any “material difference” between the two patents or their prosecution histories, the Federal Circuit’s reversal of the Board’s claim construction in the first appeal results in issue preclusion in a subsequent IPR involving the same parties and a related patent.

In Nestle, the Federal Circuit had previously considered the Board’s construction of the claim term “aseptic” in an earlier appeal of an IPR between Nestle and Steuben Foods involving U.S. Patent No. 6,945,013 (“the ‘013 Patent”).  The court reversed the Board’s construction of the term, concluding that the Board failed to limit its meaning based on “binding lexicography” in the specification of the ‘013 Patent.

After the appeal involving the ‘013 Patent, Nestle appealed the Board’s construction of the terms “aseptic” and “aseptically disinfecting” in an IPR of U.S. Patent No. 6,481,468 (“the ‘468 Patent”), which also involved Nestle and Steuben Foods.  The ‘468 and ‘013 Patents both claimed priority to the same provisional application and, according to the court, shared substantially similar descriptions of the claimed inventions.  Moreover, the parties were unable to point to anything in the intrinsic record that would indicate that the meanings of the terms “aseptic” and “aseptically disinfecting” in the ‘468 Patent would be inconsistent with the construction of “aseptic” given in the ‘013 Patent.

Based on these facts, the Federal Circuit concluded that the parties “had a full and fair opportunity to litigate the issue of claim construction” for the term “aseptic” during the prior appeal and that collateral estoppel protected Nestle from having to re-litigate this issue against the same party in the subsequent IPR.  Accordingly, the court reversed the Board’s construction of “aseptic” and “aseptically disinfecting” for the ‘468 Patent and construed these terms to have meanings consistent with the meaning of “aseptic” given in the appeal for the ‘013 Patent.

Although the facts of this case are somewhat unique, parties unhappy with a claim construction in an IPR should consider whether they should appeal the construction in order to avoid being collaterally estopped from arguments in a subsequent case.