MaxPower Semiconductor, Inc. v. Rohm Semiconductor USA, LLC

Background

MaxPower petitioned for an order requiring Rohm to stop pursuing patent-invalidation proceedings before the Patent Trial and Appeal Board (PTAB). The parties’ Technology License Agreement delegates the question of arbitrability—whether a dispute is covered by the agreement’s arbitration clause—to the arbitrator. The court had previously dismissed a related declaratory-judgment action because the arbitrator was to decide that question first.

Rohm argued that additional relief was unnecessary because the parties were already arbitrating. The court rejected that argument, explaining that a court may grant relief needed to enforce an arbitration agreement even after arbitration has begun. The court also treated the PTAB proceedings like related litigation in another forum: Rohm could be ordered to stop pursuing them until the arbitrator decides whether the patent disputes fall within the agreement.

Court’s reasoning

The court relied on federal arbitration law stating that arbitration agreements in patent-related contracts are enforceable and on precedent holding that an arbitration agreement can cover administrative proceedings as well as court cases. Because the agreement delegates arbitrability to the arbitrator, the arbitrator must decide in the first instance whether the PTAB patent disputes are subject to arbitration.

The court found irreparable harm because allowing the PTAB proceedings to continue could permanently eliminate arbitration’s promised speed and efficiency and could force MaxPower to defend its patents on multiple fronts. The court also found that the public interest favors enforcing valid arbitration agreements. It distinguished a Federal Circuit decision denying MaxPower relief under different standards from the standards governing the requested injunctive relief.

Disposition

The court granted MaxPower’s petition. It clarified that it was not directly enjoining the PTAB. Instead, Rohm was ordered, within seven days, to withdraw IPR2021-01524 and IPR2021-01525 and to join MaxPower in filing a PTAB motion seeking a stay or dismissal of IPR2020-01674, IPR2020-01675, IPR2020-01676, and IPR2020-01677. The motion must request a stay first and dismissal if the PTAB is not inclined to grant a stay. If the arbitrator determines that the patent disputes are not subject to arbitration, Rohm may resume its effort to seek invalidation of MaxPower’s patents. Judge Vince Chhabria signed the order.