The court affirmed the district court’s denial of Redline’s motion to submit four new exhibits—an expert declaration, CV, and two pieces of prior art—that was filed less than one month after the trial in the IPR had been instituted.  Under 37 C.F.R. §42.123(a), a party to an IPR may file a motion to submit supplemental information in accordance with the requirements that the request is made within one month of the date that the trial is instituted and that the supplemental information is relevant to a claim for which the trial has been instituted.  Under §42.123(b) and (c), supplemental information can be submitted more than a month after institution or if it is not relevant to an instituted claim, but only if the party shows why the information could not have been obtained earlier and that consideration of the supplemental information would be in the interests-of-justice.

Redline admitted that nothing prevented it from submitting the information with the petition itself, but it chose not to primarily to save money—the petition was based on twelve grounds and the PTO instituted the IPR based only on two of the grounds and thus the supplemental information needed to only address two grounds, not twelve. 

In affirming the district court, the Federal Circuit reviewed Section 42.123.  First, the court held that nothing in §42.123(a) requires that a request to submit supplemental information be automatically granted even if the time and relevancy requirements are met, because nothing in §42.123(a) excludes the application of other general governing regulations, and, automatically accepting supplemental information would be contrary to PTAB’s guiding principle of “ensur[ing] efficient administration of the Office and the ability of the Office to complete IPR proceedings in a timely manner.”  Second, the PTAB has discretion to grant or deny motions as it sees fit.  See, e.g., 37 C.F.R. § 42.5(a), (b).  Third, Redline misinterprets prior PTAB cases, neither of which support Redline’s interpretation of §42.123(a).  Lastly, the PTAB did not err in finding that Redline had failed to prove that the patent-at-issue would have been obvious over the prior art. 

The lesson of this case for parties wishing to file IPR petitions is to file everything with the petition.  Do not hold any information back with the intent of filing a motion §42.123(a) to add such supplemental material to the record—even if the motion is brought within one month of the decision to grant and the information is relevant to the claims.  There is no guarantee that the PTAB will allow the supplemental information to be added and it has discretion to deny the information. 

Redline Detection, LLC v. Star Envirotech, Inc., Case No. 2015-1047 (December 31, 2015); Opinion by: Wallach, joined by Lourie and Hughes; Appealed From: Patent Trial and Appeal Board.  Read the full opinion here.  

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