March 13, 2018

Collateral Estoppel Applies in IPRs Where the Issues are the Same

By Bryan K. Wheelock, Principal

In Nestle USA, Inc. v. Steuben Foods, Inc., [2017-1193] (March 13, 2018), the Federal Circuit vacated the Board’s construction of “aseptic” in U.S. Patent No. 6,481,468 because of collateral estoppel considerations, and remanded for further proceedings.

The Federal Circuit noted that Nestle had previously appealed the construction of “aseptic” in another IPR involving a related patent (U.S. Patent No. 6,945,013), and in that case, the Federal Circuit vacated the Board’s construction, relying on binding lexicography in the specification for “aseptic” to construe the term to mean the “FDA level of aseptic.”

The Federal Circuit explained that collateral estoppel protects a party from having to litigate issues that have been fully and fairly tried in a previous action and adversely resolved against a party opponent, and that it is well established that collateral estoppel applies in the administrative context. The Federal Circuit said that it was undisputed that the claims at issue in the two appeals use the term “aseptic” (or its related variation
“aseptically disinfecting”) in a similar fashion. More critically, the Federal Circuit said, the two patents also provide identical lexicography for the term “aseptic” in their specifications.

The Federal Circuit concluded that collateral estoppel protects Nestlé and obviates the need to revisit an issue that was already resolved against Steuben Foods. The Federal Circuit said that collateral estoppel is not limited “to patent claims that are identical; it is the identity of the issues that were litigated that determines whether collateral estoppel should apply.