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Licensee Standing Considerations in Appeals of IPR Decisions to the Federal Circuit

Isaac Kim and Richard F Kurz

Licensee Standing Considerations in Appeals of IPR Decisions to the Federal Circuit
Greggory DiSalvo via Getty Images

On April 7, 2021, the Federal Circuit issued an opinion in Apple Inc. v. Qualcomm Inc., No. 20-1561, --- F.3d ----, 2021 WL 1287437 (Fed. Cir. 2021) that addressed whether Apple had sufficiently showed the requisite standing to appeal two inter partes review (IPR) decisions. Id. at *1. Qualcomm sued Apple in a district court alleging infringement of certain claims of two patents. Apple filed IPR petitions with the Patent Trial and Appeal Board (PTAB) against those same patent claims. However, the PTAB decided that Apple did not prove that the challenged claims would have been obvious. Prior to the present appeals, the companies settled all litigation between them and jointly moved to dismiss the district court lawsuit with prejudice. As a part of the settlement, the parties executed a six-year license agreement that included a license to the patents and a covenant not-to-sue related to those patents. Id. at *2. Nonetheless, Apple moved forward with the present appeals of the IPR decisions. Id. at *1. Under these circumstances, the Federal Circuit found that Apple lacked standing to bring the appeals because it failed to demonstrate the requisite injury in fact.

Standing and Injury in Fact

To have standing “an appellant ‘must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the [appellee], and (3) that is likely to be redressed by a favorable judicial decision.’” Id. (alteration in original) (quoting Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547 (2016)). To establish an injury in fact, the alleged harm must be “‘concrete and particularized’ and ‘actual or imminent, not conjectural or hypothetical.’” Id. (quoting Spokeo, 136 S. Ct. at 1548). And “[w]hile nearly any person may seek an inter partes review, an appellant must ‘supply the requisite proof of an injury in fact when it seeks review of an agency’s final action in a federal court.’” Id. (quoting Phigenix, Inc. v. Immunogen, Inc., 845 F.3d 1168, 1171-72 (Fed. Cir. 2017)).

Apple’s First Argument

Apple’s first argument for standing focused on its ongoing license payment obligations in view of the Supreme Court’s holding in MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007). Apple argued that its ongoing payment obligations as a condition for certain rights under the license agreement provided standing. Id. at *3. The panel disagreed. In MedImmune, the issue was whether royalties were owed under a license agreement when Medimmune had argued that the patent at issue was invalid and did not cover its product. After paying royalties under protest, Medimmune had filed a declaratory judgment action asking that the court find that royalties were not owed because its product did not infringe any valid claim of the patents at issue. But here, the panel decided that Apple nowhere alleged that the validity of the patents at issue would affect any of its contractual rights, including its ongoing royalty obligations. The license agreement between Qualcomm and Apple covered “tens of thousands of patents,” and Apple did not provide “evidence that the validity of any single patent … would affect its ongoing payment obligations.” Id. Therefore, the panel found that Apple’s standing argument based on its ongoing royalty obligations failed.

Apple’s Second Argument

Apple’s second argument was that it had standing because of the possibility that Qualcomm might sue Apple for infringing the patents after the license expires. Id. at *4. The panel decided that several factors weighed against this argument, making the “possibility of suit [] too speculative to confer standing.” Id. Apple provided no evidence that it intended to engage in infringing activity after the license expires. In fact, in its declaration submitted as evidence of standing, there was no mention of the patents at issue. Further, there was no indication in the declaration that Apple planned to engage in infringing conduct after the license expiration, such as plans to make or use the products that were accused of infringement in the original district court action (e.g., the iPhones 4, 5, 6, and 7). The panel ultimately determined that the declarations were “devoid of any of the specificity necessary to establish an injury in fact.” Id.

The Decision

Apple also argued that Qualcomm’s prior district court infringement action provided evidence of standing, citing Grit Energy Sols., LLC v. Oren Techs., LLC, 957 F.3d 1309, 1320 (Fed. Cir. 2020). Id. But this was of no avail. The panel pointed out that, unlike Grit Energy, which involved a dismissal without prejudice, the district court action here was dismissed with prejudice.

Apple further asserted that standing should exist because of Qualcomm’s history of asserting patents against Apple after agreements have expired. Id. The panel decided that this too was insufficient, explaining that Apple’s assertion was “speculation and conjecture about Qualcomm’s proclivity to assert its patent rights generally.” Id. The assertion was “devoid of the specificity necessary to show that Qualcomm is likely to assert these particular patents against any particular products” upon license agreement expiration. Id. Thus, Apple had “failed to show an injury in fact based on potential future allegations” of infringement. Id.  

Accordingly, because Apple had failed to establish standing, the Federal Circuit dismissed the appeal. Id. at *5.


Apple Inc. v. Qualcomm Inc. provides an interesting discussion about standing issues that may arise when appealing IPR decisions involving a licensee and licensor. Against the backdrop of a global litigation settlement, a dismissal with prejudice of Qualcomm’s district court action, and a license to the patents at issue under an agreement involving thousands of other patents, the Federal Circuit determined that there was no case or controversy to support standing to hear the appeal of the IPR decisions. The panel’s decision may thus provide guidance for practitioners who are structuring license and settlement agreements and who may want to maintain standing for future appeals of IPR decisions.