In IOENGINE, LLC v. Ingenico Inc. (Fed. Cir. 2025), the Federal Circuit narrowed the scope of IPR estoppel under 35 U.S.C. § 315(e)(2), which precludes an IPR petitioner from asserting in court that a patent claim “is invalid on any ground” that the petitioner raised or reasonably could have raised during the IPR. With Ingenico, the court resolved a long standing split regarding the proper interpretation of “ground,” holding that the term “ground” refers to the legal theory of invalidity (e.g., anticipation or obviousness), not the specific prior art references or evidence used.
The litigation began when IOENGINE sued PayPal for infringing patents related to USB-type devices that communicate with a server based on user inputs. Ingenico, PayPal’s supplier, filed a declaratory judgment action and challenged the patents both in district court and through IPRs. The PTAB found many claims unpatentable, but not all. At trial, Ingenico argued the DiskOnKey Firmware Upgrader had been in “public use” more than one year before the patents’ priority date, rendering the remaining claims invalid under pre-AIA § 102(b).
On appeal, IOENGINE argued mere availability of the Firmware Upgrader was insufficient to show public use because it “does not prove actual use by someone at some point.” IOENGINE also argued that § 315(e)(2) should have barred Ingenico from introducing the Firmware Upgrader at trial. Under § 315(e)(2), after an IPR reaches a final written decision, the petitioner may not assert in court any invalidity ground that it raised or reasonably could have raised during that IPR. Ingenico used the Firmware Upgrader to show that the claimed invention was already known, used, on sale, or in public use before IOENGINE’s priority date. IOENGINE argued that Ingenico should have been barred from using the Firmware Upgrader at trial because the its capabilities were already fully documented in a ReadMe file—printed publications that IOENGINE argued Ingenico could have raised in IPR.
The panel rejected both arguments. First, it held that there was substantial evidence to support the jury’s finding that the Upgrader was in public use, even if it was not direct evidence. The evidence consisted primarily of emails to M-Systems’ employees encouraging them to inform their customers about the Upgrader, as well as press releases and archived M-Systems webpages.
Second, the panel held that IPR estoppel does not bar arguments based on public use, on-sale activity, or prior knowledge/use by others, because these are grounds of invalidity that Congress excluded from the scope of IPR With § 311(b), Congress “intentionally” limited an IPR’s scope to invalidity challenges based on “prior art consisting of patents or printed publications.” In other words, Congress designed the IPR process so that a petitioner has no opportunity to challenge the claimed invention under the public use, on-sale activity, or prior knowledge/use theories at IPR. Section 312(a)(3) reinforces this distinction by labeling patents and publications as evidence supporting a ground, not the ground itself.
Accordingly, because Congress deliberately chose the word “ground” (rather than “prior art”) in § 315(e)(2), estoppel bars only those printed-publication theories that were, or could have been, litigated in the PTAB. Applying that framework, the court held that Ingenico’s district court defense was not estopped. The Ingenico decision also aligns with the court’s reading of § 311(b) in Qualcomm II, which permits non-printed-publication material (like applicant-admitted prior art) to be cited for context so long as the basis of the IPR ground remains limited to patents or printed publications.
In short, estoppel attaches to the theory, not the reference: petitioners cannot relitigate the same printed-publication ground in court, but they may introduce the same documents to support a different, non-IPR ground such as public use or on-sale bar.
Takeaway: Petitioners now have confidence that filing an IPR will not interfere with presentation of a trial court invalidity ground based on product prior art. It remains to be seen how the PTAB will react, particularly in view of recent discretionary institution denials due to overlap of invalidity/unpatentability issues between the PTAB and trial courts.
