Petition for Writ of Certiorari — Koss Corporation, Petitioner v. Bose Corporation
Supreme Court briefFeb 21, 2025
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No. __________
IN THE
Supreme Court of the United States
_____________________________
KOSS CORPORATION,
Petitioner,
vs.
BOSE CORPORATION,
Respondent.
_____________________________
On Petition for a Writ of Certiorari to the United States
Court of Appeals for the Federal Circuit
_____________________________
PETITION FOR A WRIT OF CERTIORARI
_____________________________
ERIK HALVERSON
K&L GATES LLP
Four Embarcadero Center
Suite 1200
San Francisco, CA 94111
DAVID R. FINE
(Counsel of Record)
K&L GATES LLP
Market Square Plaza
17 North Second Street
18th Floor
Harrisburg, PA 17101
(717) 231-4500
david.fine@klgates.com
Counsel for Petitioner Koss Corporation
(i)
QUESTION PRESENTED
In this case, the Federal Circuit precedentially
adopted a novel and expansive rule of collateral estoppel (or issue preclusion) that bypasses key requirements this Court has established.
In a first case, a district court decided on a Rule12(b)(6) motion that certain patent claims were invalid as pleaded. The court allowed the plaintiff to
amend its complaint, and the plaintiff did so. Not
long after, the parties filed and the district court approved a with-prejudice dismissal stipulation.
A second case involving the same patent claims but
a different defendant was on appeal to the Federal
Circuit when the first case was dismissed. The Federal Circuit held that, while the invalidity holding in
the first case was, standing alone, without prejudice,
it “merged” into the stipulated with-prejudice dismissal so that it could be afforded nonmutual collateralestoppel effect. The Court of Appeals concluded that
the patent claims were accordingly invalid and the
appeal before it was moot.
The question presented is as follows:
When a district court grants a Rule-12(b)(6) motion
to dismiss but does so without prejudice and with
leave to amend, may that non-merits determination
be given collateral-estoppel effect on the theory that
it merged into a later with-prejudice dismissal stipulation?
(ii)
PARTIES TO THE PROCEEDING
AND RULE 29.6 STATEMENT
The parties to the proceeding are Petitioner Koss
Corporation and Respondent Bose Corporation.
Pursuant to Supreme Court Rule 29.6, Petitioner
Koss Corporation discloses that it has no parent corporation and that no publicly traded corporation owns
10 percent or more of the shares of its stock.
(iii)
STATEMENT OF RELATED PROCEEDINGS
Pursuant to this Court’s Rule 14.1(b)(iii), the following proceedings are directly related to this case:
Koss Corporation v. Bose Corporation, No. IPR202100297, Patent Trial and Appeal Board. Judgment entered May 31, 2022.
Koss Corporation v. Bose Corporation, No. IPR202100612, Patent Trial and Appeal Board. Judgment entered September 13, 2022.
Koss Corporation v. Bose Corporation, No. IPR202100680, Patent Trial and Appeal Board. Judgment entered October 7, 2022.
Koss Corporation v. Bose Corporation, No. 1:20-cv12193, United States District Court for the District of
Massachusetts (pending).
Koss Corporation v. Plantronics, Inc., No. 4:21-cv3854, United States District Court for the Northern
District of California. Judgment entered August 4,
2023.
(iv)
TABLE OF CONTENTS
Page
QUESTION PRESENTED ...........................................i
PARTIES TO THE PROCEEDING AND RULE
29.6 STATEMENT ..................................................... ii
STATEMENT OF RELATED PROCEEDINGS ....... iii
TABLE OF CONTENTS ............................................ iv
TABLE OF AUTHORITIES ....................................... vi
OPINIONS BELOW .................................................... 1
JURISDICTION .......................................................... 1
CONSTITUTIONAL AND STATUTORY
PROVISIONS INVOLVED ......................................... 2
INTRODUCTION ........................................................ 3
STATEMENT OF THE CASE .................................... 7
REASONS FOR GRANTING THE PETITION ......... 7
I. The Federal Circuit’s holding conflicts
with holdings of this Court ................................ 10
II. The Federal Circuit’s holding is troubling
as a matter of policy .......................................... 18
CONCLUSION .......................................................... 25
APPENDIX
Appendix A—Opinion of the U.S. Court of Appeals
for the Federal Circuit, filed July 19, 2024 .............. 1a
(v)
Appendix B—Denial of Rehearing of the U.S. Court
of Appeals for the Federal Circuit, filed September
30, 2024 .................................................................... 10a
(vi)
TABLE OF AUTHORITIES
Page(s)
Cases
Aqua Marine Supply v. AIM Machining, Inc.,
247 F.3d 1216 (Fed. Cir. 2001) .............................. 22
Arizona v. California,
530 U.S. 392 (2000) .............................. 12, 13, 14, 17
B&B Hardware, Inc. v. Hargis Indus., Inc.,
575 U.S. 138 (2015) ................................................ 10
Blonder-Tongue Lab’ys, Inc. v. University of Illinois
Found., 402 U.S. 313 (1971) ............................ 10, 15
Bobby v. Bies, 556 U.S. 825 (2009) ............. 3, 5, 11, 13
Commonwealth School, Inc. v. Commonwealth
Academy Holdings, LLC, 994 F.3d 77 (1st Cir.
2021) ................................................................... 6, 13
Google LLC v. Hammon Dev. Int’l, Inc.,
54 F.4th 1377 (Fed. Cir. 2022) ................................. 5
Hartley v. Mentor Corp.,
869 F.2d 1469 (Fed. Cir. 1989) ........... 14, 15, 16, 17
Headwaters Inc. v. U.S. Forest Serv.,
399 F.3d 1047 (9th Cir. 2005) ................................ 14
Jackson v. Hayakawa, 605 F.2d 1121
(9th Cir. 1979) ........................................................ 15
(vii)
Koss Corporation v. Bose Corporation,
No. 2022-2090 (Fed. Cir. July 19, 2024) . …1, 4, 7, 8,
9, 14, 16, 17, 18, 22
Koss Corp. v. Vidal,
No. 22-2091, 2024 WL 3594417 (Fed. Cir. July 31,
2024) ....................................................................... 23
Lacey v. Maricopa Cnty,
693 F.3d 896 (9th Cir. 2012) .................................. 17
U.S. Bancorp Mortgage Co. v. Bonner Mall
Partnership, 513 U.S. 18 (1994) ............................ 22
Uniloc USA, Inc. v. Motorola Mobility LLC,
52 F.4th 1340 (Fed. Cir. 2022) ............................... 18
United States v. Maull,
855 F.2d 514 (8th Cir. 1988) ..................................... 16
Watermark Senior Living Retirement Communities,
Inc. v. Morrison Management Specialists, Inc.,
905 F.3d 421 (6th Cir. 2018) .................................. 22
Wolfson v. Brammer,
616 F.3d 1045 (9th Cir. 2010) ............................ 5, 11
Statutes
28 U.S.C. § 1254(1) ...................................................... 2
35 U.S.C. § 282 .................................................. 2, 6, 18
Rules
Fed. R. Civ. P. 12(b)(6) .... 4, 5, 7, 11,13, 14, 16, 17, 21
(viii)
Other Authorities
“Beware Equitable Doctrine of Issue Preclusion in
Multiparty, Multivenue Patent Campaigns,” JD
Supra (Aug. 1, 2024), https://www.jdsupra.com/legalnews/beware-equitable-doctrine-of-issue6713900/.................................................................. 20
James Fleming, Jr., Consent Judgments as Collateral
Estoppel, 108 U. PENN. L. REV. 173 (1959) ............ 19
Note, Collateral Estoppel by Judgment,
52 COLUM. L. REV. 647, 657 (1952) ........................ 21
Alan N. Polaski, Collateral Estoppel—Effects of Prior
Litigation, 39 IOWA L. REV. 27, 220 (1954) ............ 20
RESTATEMENT (SECOND) OF JUDGMENTS
§ 27 cmnt h .............................................. 3, 10,11, 12
18 WRIGHT, MILLER & COOPER, FEDERAL PRACTICE &
PROCEDURE § 4421 (2d ed. 2002) ........................... 12
18 WRIGHT, MILLER & COOPER, FEDERAL PRACTICE &
PROCEDURE § 4423 (3d ed. 2024) ........................... 21
18 WRIGHT, MILLER & COOPER, FEDERAL PRACTICE &
PROCEDURE § 4436 (2000) ...................................... 11
1
PETITION FOR A WRIT OF CERTIORARI
Koss Corporation requests that the Court grant
this petition for a writ of certiorari to review the judgment of the United States Court of Appeals for the
Federal Circuit.
OPINIONS BELOW
The decision of the United States Court of Appeals
for the Federal Circuit is published at 107 F.4th 1363
(Fed. Cir. 2024) and reproduced in Appendix A (1a9a)
The appeal to the Federal Circuit arose from three
matters in the Patent Trial and Appeal Board: Koss
Corporation v. Bose Corporation, No. IPR2021-00297,
2022 WL 1797707 (May 31, 2022); Koss Corporation
v. Bose Corporation, No. IPR2021-00612. 2022 WL
4281513 (Sept. 13, 2022); and Koss Corporation v.
Bose Corporation, No. IPR2021-00680. 2022 WL
6036549 (Oct. 7, 2022). None is directly relevant to
the issue raised in this petition and, so, they are not
reproduced in the appendix.
JURISDICTION
The Court of Appeals entered judgment on July
19, 2024.1 The Court of Appeals denied the petitioner’s petition for rehearing en banc on September
30, 2024.2 On December 13, 2024, Chief Justice Roberts granted an extension of time to file the petition
1 (1a, 9a)
2 (11a)
2
for a writ of certiorari until February 27, 2025. Koss
Corp. v. Bose Corp., No. 24A577. This Court has jurisdiction under 28 U.S.C. § 1254(1).
CONSTITUTIONAL AND STATUTORY
PROVISIONS INVOLVED
35 U.S.C. § 282. - Presumption of validity;
defenses
(a) In General.—
A patent shall be presumed valid. Each
claim of a patent (whether in independent, dependent, or multiple dependent
form) shall be presumed valid independently of the validity of other
claims; dependent or multiple dependent claims shall be presumed valid
even though dependent upon an invalid
claim. The burden of establishing invalidity of a patent or any claim thereof
shall rest on the party asserting such
invalidity.
3
INTRODUCTION
While collateral estoppel (or issue preclusion) may
be beneficial, it also poses significant risks for parties
to litigation and to the courts.3 If collateral estoppel
is extended beyond the careful confines this Court
has established, the doctrine’s goals of finality, efficiency, and consistency may quickly be outweighed
by the dangers of perpetuating error, depriving parties of a fair opportunity to litigate issues, and potentially forcing parties to assertively litigate cases that
might otherwise be settled. Those dangers are all the
more troubling when collateral estoppel is applied in
a nonmutual subsequent action.
Collateral estoppel, as applied in federal court (and
most state courts), requires that the determination to
be given preclusive effect have been “actually litigated” and “essential” to the final judgment in the
case. Bobby v. Bies, 556 U.S. 825, 835 (2009) (citing
RESTATEMENT (SECOND) OF JUDGMENTS § 27, cmnt h).
The Federal Circuit bypassed those requirements
in this case and established a new, broad rule for collateral estoppel that is inconsistent with decisions of
this Court and that raises significant legal and policy
concerns.
3 The phrases “collateral estoppel” and “issue preclusion” are of-
ten used interchangeably. Because cases and secondary sources
more often refer to “collateral estoppel,” this petition will as
well.
4
In Koss Corporation v. Plantronics, Inc., in which
Koss Corporation alleged patent infringement, the
district court decided on a Rule-12(b)(6) motion that
certain of Koss’s patent claims were patent ineligible.4 In the same order, however, the court allowed
Koss leave to amend.5 Koss filed an amended complaint and, before the court resolved a subsequent
motion to dismiss that amended complaint, the parties stipulated to dismiss the amended complaint
with prejudice.6
In this case, which involves the same patents but
a different defendant, the Federal Circuit looked at
the result in the first case and concluded that the
Rule-12(b)(6) holding regarding the earlier complaint, while without prejudice, somehow merged
with the with-prejudice stipulation.7 From that predicate, the appeals court concluded that the earlier
holding should be given collateral-estoppel effect as a
merits determination, thus binding the patent owner
to the invalidity determination.8
The Federal Circuit’s extension of collateral estoppel was wrong, and it established troubling precedent.
4 Koss Corp. v. Bose Corp., No. 2022-2090 (Fed. Cir. July 19,
2024) (referring to Koss Corporation v. Plantronics, Inc., No.
4:21-cv-03854 (N.D. Cal.)). (4a)
5 Id. (5a)
6 Id.
7 Id. (9a)
8 Id.
5
First, the permitted amendment mooted the earlier complaint, and the district court did not actually
decide anything with respect to the amended complaint. Thus, there was no “actual litigation” of patentability of the claims pleaded in the second
amended complaint that was extant when the parties
filed their dismissal stipulation.
Second, for an issue to be “actually litigated,” there
must be a merits determination of that issue. Google
LLC v. Hammon Dev. Int’l, Inc., 54 F.4th 1377, 1381
(Fed. Cir. 2022). If a district court decides that there
is a curable pleading defect and it allows an amended
complaint, the court has not decided the merits of
whether there is, in fact, a proven claim or defense.
Wolfson v. Brammer, 616 F.3d 1045, 1064 (9th Cir.
2010).
Third, the district court’s evaluation of a superseded complaint cannot be deemed “essential” to the
with-prejudice dismissal stipulation. Bobby, 556 U.S.
at 835 (requiring that the holding be essential to the
judgment). The bare-bones stipulation in Plantronics
does not in any way suggest that the Rule-12(b)(6)
decision was essential to the with-prejudice dismissal. The Federal Circuit’s novel merger theory effectively evades the essential-to-the-judgment requirement, and it misperceives what it means to say that
interlocutory orders merge into a final judgment.
Merger in that context provides that, once a final
judgment is entered, earlier, previously unappealable orders generally become appealable and a notice
of appeal that refers only to the final judgment
6
sweeps within its scope all previous orders. Commonwealth School, Inc. v. Commonwealth Academy Holdings, LLC, 994 F.3d 77, 82 (1st Cir. 2021).
The Federal Circuit’s holding has dramatically affected Koss’s patent rights. As a result of the court’s
mistaken analysis, a non-merits decision on the sufficiency of a superseded complaint is now being
treated as a merits judgment that Koss’s patents are
invalid—a judgment any future infringer may rely
on. Thus, without any court’s having reached an actual merits decision on the issue, the Federal Circuit
has held that Koss is collaterally estopped from denying its patents’ invalidity—all notwithstanding a
statutory presumption that the patents are, in fact,
valid. 35 U.S.C. § 282.
The Federal Circuit’s holding, which the court
made precedential, will have broad effects beyond
this case. Because of the Federal Circuit’s specialized
jurisdiction, its holding will have an outsized effect
on patent jurisprudence: the Federal Circuit has now
blessed a procedural shortcut that will be used—as it
has been in this case—to deprive patent holders of
their rights.
The holding will also have ramifications beyond
the patent world; it will dissuade parties from settlements and impose extraordinary collateral effects on
parties to past settlements—effects those parties
could not have anticipated.
7
STATEMENT OF THE CASE
This case involves principally two proceedings.9
The first lawsuit proceeded in the Northern District of California. See Koss Corp. v. Plantronics, Inc.,
No. 4:21-cv-03854 (N.D. Cal.).10 Koss alleged that
Plantronics, Inc., infringed a number of Koss’s patents.11 After Koss filed a first amended complaint,
Plantronics moved to dismiss under Rule 12(b)(6) and
alleged that relevant claims in the three patents were
patent ineligible.12 The district court granted the motion but also granted Koss leave to file a second
amended complaint.13 Koss filed the permitted second amended complaint, and Plantronics responded
with a motion to dismiss claiming, again, patent ineligibility.14 Before the district court resolved the second motion, Koss and Plantronics settled their dispute and stipulated that the action, “including all
claims and counterclaims, be dismissed with prejudice.” The stipulation made no reference to any earlier determination in the case or to collateral estoppel.
9 For sake of brevity, this description of the factual and proce-
dural history of the case is somewhat simplified, but no relevant
information has been omitted.
10 Koss Corp. v. Bose Corp., No. 2022-2090 (Fed. Cir. July 19,
2024) (3a)
11 Id. (4a)
12 Id. (4a)
13 Id. (5a)
14 Id. (5a)
8
In parallel with the case against Plantronics, Koss
filed a patent-infringement suit against Bose Corporation in the Western District of Texas.15 That suit
related to three of the same patents as were at issue
in the Plantronics case.16 Bose responded with a motion challenging venue and with petitions seeking inter partes review of the same three patents before the
Patent Trial and Appeal Board.17 Bose also filed a
separate declaratory-judgment action in the District
of Massachusetts against Koss, seeking a declaration
of non-infringement of those same three patents.18
The Texas-based federal court ultimately dismissed
Koss’s suit for improper venue, and the Massachusetts-based federal court stayed the suit before it
pending resolution of the matters before the PTAB.19
The PTAB concluded that some claims in the three
patents were unpatentable and that Bose failed to
prove unpatentability of others, and both Koss and
Bose appealed the PTAB’s findings to the Federal
Circuit.
While the appeals in the Bose matter were pending, the parties to the Plantronics suit reached their
resolution and filed their stipulation.20 Bose then
15 Id. (2a)
16 Id. (3a)
17 Id. (3a)
Id. (citing Koss Corp. v. Bose Corp., No. 1:20-cv-12193 (D.
Mass.)) (3a)
19 Id. (3a)
18
20 Id. (5a)
9
asked the Federal Circuit to dismiss the pending appeals from the PTAB as moot on the theory that Koss
was collaterally estopped to deny the invalidity of the
patent claims, and the Federal Circuit did so.21
The Federal Circuit reasoned that the Northern
District of California’s decision in Plantronics—finding the patents invalid but granting leave to amend—
merged into the with-prejudice stipulation of dismissal such that collateral estoppel applied and the patents were preclusively invalid.22 Accordingly, the
Federal Circuit concluded that the appeals from the
PTAB were moot as there was no live case or controversy before it.23
Koss sought rehearing, which the Federal Circuit
denied.
REASONS FOR GRANTING THE PETITION
While this Court has not yet addressed the specific
issue raised in this petition, key components of the
Federal Circuit’s analysis conflict with previous holdings of this Court. Moreover, the Federal Circuit’s decision is not merely wrong; by making that decision
precedential, the Federal Circuit has established a
considerably broader rule of collateral estoppel than
has any other court, and that rule poses particular
dangers—of dissuading parties from settling; of upending settled expectations related to already
21 Id. (6a)
22 Id. (9a)
23 Id. (9a)
10
completed settlements; and, in the patent context, of
depriving patent holders of the statutory presumption that their patents are valid without any court’s
having actually reached a merits decision on that
question.
This Court should step in now.24
I. The Federal Circuit’s holding conflicts with
holdings of this Court.
At Bose’s invitation, the Federal Circuit adopted
a broad rule of collateral estoppel the underpinnings
of which conflict directly with holdings of this Court.
The Federal Circuit held that the district court’s
pleading-sufficiency analysis of an early-and-superseded iteration of the complaint in Plantronics
“merged” with the with-prejudice stipulation such
that the sufficiency holding was due collateral-estoppel effect.
1. The Federal Circuit’s holding is at odds with
the requirement that, for a holding to be given preclusive effect, it must have been on an issue that was
“actually litigated.” B&B Hardware, Inc. v. Hargis
Indus., Inc., 575 U.S. 138, 148 (2015) (citing RESTATEMENT (SECOND) OF JUDGMENTS § 27). To have been
“actually litigated,” an issue must have been subject
to a merits determination. Blonder-Tongue Lab’ys,
24 The facial error in the Federal Circuit’s decision is such that
the Court may wish simply to grant this petition, vacate, and
remand to the court of appeals for a decision on the merits of
Koss’s challenge to the PTAB’s decisions.
11
Inc. v. University of Illinois Found., 402 U.S. 313, 332
(1971).
The patentability of the patent claims in the
Plantronics case was not “actually litigated.”
The district court’s Rule-12(b)(6) holding was not
and did not purport to be a merits decision. It was an
assessment of the sufficiency of the allegations in
Koss’s first amended complaint. The district court did
not suggest that the insufficiency it identified could
not be cured; indeed, it allowed Koss to file an
amended complaint to cure the perceived insufficiency. See Wolfson, 616 F.3d at 1065 (“ ... the district
court’s dismissal was not an adjudication of the merits. Rather, the district court set forth a curable defect in jurisdiction: ripeness. As a curable defect, a
second action on the same claim is permissible after
correction of the deficiency.”) (citing 18 WRIGHT, MILLER & COOPER, FEDERAL PRACTICE & PROCEDURE §
4436 (2000)).
2. The Federal Circuit’s holding is at odds with
the requirement that, for a holding to be given preclusive effect, it must be “essential” to the judgment.
In Bobby, the Court underscored that “issue preclusion ... bars relitigation of determinations necessary to the ultimate outcome of a prior proceeding.”
Id. at 829. Thus, if “a judgment does not depend on a
given determination, relitigation of that determination is not precluded.” Id. at 834 (citing RESTATEMENT
(SECOND) OF JUDGMENTS § 27, cmnt h). “A determination ranks as necessary or essential only when the
12
final outcome hinges on it.” Id. at 835 (citing 18
WRIGHT, MILLER & COOPER, FEDERAL PRACTICE &
PROCEDURE § 4421 (2d ed. 2002)).
Comment h to the Restatement section explains
why a determination that is not essential to the final
judgment lacks preclusive effect:
If issues are determined but the judgment is
not dependent upon the determinations, relitigation of those issues in a subsequent action
between the parties is not precluded. Such determinations have the characteristics of dicta,
and may not ordinarily be the subject of an appeal by a party against whom they were made.
In these circumstances, the interest in providing an opportunity for a considered determination, which if adverse may be the subject of an
appeal, outweighs the interest in avoiding the
burden of relitigation.
RESTATEMENT (SECOND) OF JUDGMENTS § 27, cmnt h.
That point is all the more important when the question is of nonmutual collateral estoppel employed by
a stranger to the first case who cannot claim the burden of relitigation that is often cited as a reason for
collateral estoppel.
In Arizona v. California, 530 U.S. 392 (2000), the
Court emphasized this requirement when it explained that “settlements ordinarily occasion no issue
preclusion (sometimes called collateral estoppel), unless it is clear, as it is not here, that the parties intend
13
their agreement to have such an effect.” 530 U.S. at
414 (emphasis original).
In Plantronics, as in Arizona v. California, there
was no indication—much less a clear indication—
that the parties based their stipulated dismissal on
the district court’s assessment of the superseded iteration of the complaint and, so, it cannot be said that
the court’s assessment of the first amended complaint was essential to the parties’ unexplained
agreed-upon dismissal of the second amended complaint. And, importantly, the Federal Circuit did not
even recognize that the parties’ intent should be considered. It simply held that the Rule-12(b)(6) decision
merged with the stipulation and became a with-prejudice merits determination. But there is no basis for
any court to conclude that the stipulated dismissal in
Plantronics “hinged on” the district court’s Rule12(b)(6) decision. Bobby, 556 U.S. at 835.
3. The Federal Circuit’s merger rule not only has
no jurisprudential support, it leapfrogs key requirements this Court has recognized for collateral estoppel.
When courts say that earlier, interlocutory decisions “merge” into the final judgment, they mean that
those earlier orders, unappealable when entered,
may be appealed when a final judgment is entered
and that a notice of appeal that designates only the
final judgment sweeps within its scope essentially all
earlier orders. See, e.g., Commonwealth School. Inc.,
994 F.3d at 82. Properly understood, merger may
14
allow an appeal from a previously unappealable order, but there is no basis to conclude that it turns a
non-merits decision into a merits decision.25
The Federal Circuit’s merger theory evades this
Court’s requirement that a determination may only
be given preclusive effect if it was essential to a merits judgment. There is no evidence that the early
Rule-12(b)(6) decision in Plantronics was essential to
the later, post-amendment dismissal stipulation, but
the Federal Circuit inappropriately bridged that analytical gap with its merger theory. Such an approach
runs headlong into Arizona v. California. See 530
U.S. at 414 (consent judgments do not ordinarily give
rise to collateral estoppel because the doctrine only
applies when an issue has been actually litigated and
the determination is essential to the judgment).
4. The Federal Circuit relied heavily on its decision in Hartley v. Mentor Corp., 869 F.2d 1469 (Fed.
Cir. 1989).26 Hartley does not support the holding
here because the facts were distinguishable and, to
the extent the legal holdings might nonetheless be
25 The only authority the Federal Circuit cited for its merger
theory—Headwaters Inc. v. U.S. Forest Serv., 399 F.3d 1047
(9th Cir. 2005)—stands only for the unremarkable principle
that a with-prejudice dismissal stipulation constitutes a final
judgment on the merits. Id. at 1052. Headwaters speaks not at
all to whether any earlier orders might merge into that stipulation for collateral-estoppel purposes, an unsurprising omission
since the case deals with res judicata rather than collateral estoppel.
26 Koss Corp. v. Bose Corp. (7a)
15
asserted to bolster the conclusion in this case, they
are mistaken.
In a first lawsuit, John H. Hartley, Jr., sued Minnessota Mining and Manufacturing Co. (“3M”) for patent infringement. The district court granted summary judgment to 3M on an invalidity defense and,
rather than appeal, Mr. Hartley reached a settlement
with 3M by which the parties stipulated to a withprejudice dismissal.
In a second lawsuit, in which Mr. Hartley sued
Mentor Corporation, the Federal Circuit held that
Mr. Hartley was collaterally estopped by the summary-judgment holding in the 3M case to dispute the
patent’s invalidity. 869 F.2d at 1471.
Hartley is distinguishable. Collateral estoppel requires that there be a judgment on the merits.
Blonder-Tongue Lab’ys, Inc., 402 U.S. at 332. The district court in Hartley granted summary judgment of
invalidity, and a grant of summary judgment is generally a final merits determination. See Jackson v.
Hayakawa, 605 F.2d 1121, 1125 (9th Cir. 1979). Indeed, while the Federal Circuit in Hartley discussed
the effect of a later stipulated judgment, it need not
have. The district court had already granted summary judgment on invalidity, and that decision was
a final merits judgment for collateral-estoppel purposes.27 On the other hand, a Rule-12(b)(6) dismissal
27 In this case, the Federal Circuit seems to have misunderstood
the procedural history in Hartley. The court wrote that, in Hartley, “we held that an interlocutory summary judgment of
16
with leave to amend is not a final merits determination unless the party fails to file the amended pleading. See United States v. Maull, 855 F.2d 514, 516 n.3
(8th Cir. 1988). Hartley and this case are distinguishable.
There is another distinction. In Hartley, the court
explained that collateral estoppel may be warranted
when an opinion “is consistent with the subsequent
settlement agreement.” 869 F.2d at 1472. While, as
Koss will explain below, that statement is at odds
with this Court’s later precedents, it also demonstrates why Hartley is distinguishable from this case.
Here, the Federal Circuit made no effort to determine
if there was a settlement agreement or if it was “consistent” with the district court’s Rule-12(b)(6) holding.28
In any event, Hartley conflicts with this Court’s
later precedents. The Federal Circuit held in that
case that, while it is true that a decision followed by
invalidity merged with the final stipulation of dismissal with
prejudice.” Koss Corp. v. Bose Corp. (7a) While the decision in
Hartley is less than clear, there is no suggestion that the court
relied on a merger theory. It would not have needed to do so. As
noted in the text, the grant of summary judgment is a merits
decision for collateral-estoppel purposes; the summary judgment did not need to merge with the stipulated judgment to
have preclusive effect.
28 There is no settlement agreement in the record. The parties’
stipulation, approved by the district court, is a bare-bones document. See Koss Corp. v. Plantronics, Inc., 4:21-cv-03854 (N.D.
Cal.) ECF Doc. 102.
17
a stipulated judgment will not generally give rise to
collateral estoppel, it may nonetheless do so when the
decision “is consistent with the subsequent settlement agreement.” 869 F.2d at 1472. The court went
on to conclude that “nothing in the stipulated judgment conflicts with the invalidity ruling by Judge Lucas.” Id. But, as this Court later held in Arizona v.
California, collateral estoppel may arise if there is affirmative evidence that the parties intended their
stipulation to have preclusive effect. 530 U.S. at 414.
It is not sufficient merely to conclude that the stipulation is not passively in conflict with the earlier
holding as in Hartley.
Hartley does not support the Federal Circuit’s decision in this appeal.29
29 There is another way in which the Federal Circuit’s analysis
was off base. Koss argued that, when it amended its complaint,
the district court’s Rule-12(b)(6) invalidity ruling became a nullity. The Federal Circuit rejected Koss’s nullity argument by
pointing to Lacey v. Maricopa Cnty, 693 F.3d 896 (9th Cir. 2012),
for the proposition that, since Lacey holds that dismissed claims
need not be repleaded to later be subject to appeal, “the order
dismissing those claims is not rendered a nullity and merges
into the final judgment.” Koss Corp. v. Bose Corp. (8a) Lacey is
no support for that conclusion. In Lacey, the en banc Ninth Circuit changed its rule and held that, henceforth, “for claims dismissed with prejudice and without leave to amend, we will not
require that they be repled in a subsequent amended complaint
to preserve them for appeal.” 693 F.3d at 928 (emphasis
added). Thus, Lacey has nothing at all to say about the effect
when a district court grants leave to amend because its holding
assumes there has been no such leave.
18
II. The Federal Circuit’s holding is troubling as
a matter of policy.
The Federal Circuit ignored the significant and
troubling policy implications of its unprecedented
and mistaken extension of collateral estoppel.
Some of those policy concerns are specific to the
Federal Circuit and its patent docket.
First, the Federal Circuit is the only appellate
court other than this one that hears appeals from all
94 district courts. Its holdings can accordingly have
particularly outsized jurisprudential implications—
especially, of course, in patent cases.30
Second, federal law presumes that patents are
valid. 35 U.S.C. § 282. Courts should be particularly
reluctant to embrace novel procedural mechanisms to
declare patents invalid without actually addressing
the merits. In this case, the Federal Circuit took such
a shortcut. Recall that, in Plantronics, the district
court never decided on the merits whether Koss’s patent claims were invalid. It concluded only that
30 On matters of non-patent procedural issues, the Federal Cir-
cuit follows the law of the regional court of appeals for the circuit in which the district court is located. Uniloc USA, Inc. v.
Motorola Mobility LLC, 52 F.4th 1340, 1346 n.3 (Fed. Cir. 2022).
Since the federal courts of appeals generally follow Section 27 of
the Restatement (Second) of Judgments, it is fair to assume that
the Federal Circuit would apply its holding in this case regardless of where a future case might arise. Indeed, it held in footnote 3 of its opinion that it saw no difference between its relevant law and that of the Ninth Circuit. Koss Corp. v. Bose Corp.
(6a)
19
Koss’s first amended complaint was insufficiently
pleaded with respect to patentability. But, in this
case, by a facile procedural analysis, the Federal Circuit converted that non-merits determination to a
merits holding that, for this and all other cases, the
patent claims are conclusively invalid. The court of
appeals’ approach is troubling not only for this case
and Koss’s patent rights but for future cases involving other parties, cases to which the court’s errant
holding will be applied to strip patent holders of the
statutory presumption of validity.
The holding here is troubling in a broader context
as well.
First, it is common for parties that settle cases to
agree to with-prejudice dismissals. Indeed, defendants have little incentive to settle without them since
a principal purpose of settlement is to end the dispute
conclusively. See James Fleming, Jr., Consent Judgments as Collateral Estoppel, 108 U. PENN. L. REV.
173, 190 (1959) (stipulated judgment often critical requirement of settlement). But, after the Federal Circuit’s decision in this case, plaintiffs may be unwilling to agree to with-prejudice dismissals since they
may later be held to bind those plaintiffs. The legal
system benefits from settlement, and the Federal
Circuit’s holding will discourage some agreed-upon
resolutions because defendants will understandably
demand with-prejudice dismissals and plaintiffs,
20
worried about future effects of the Federal Circuit’s
new issue-preclusion/merger theory, will refuse.31
As Professor Polasky wrote long ago,
it is possible that the desirability of conclusiveness of determinations is not necessarily
compatible with the desirability of minimizing litigation. ... [A]ny tendency to extend the
conclusive effects of matters previously adjudicated might easily tend to intensify the effort expended in the initial litigation and
might increase the probability of resort to appeal, particularly where the determination
could affect causes of action not involved in
the current litigation.
Alan N. Polaski, Collateral Estoppel—Effects of Prior
Litigation, 39 IOWA L. REV. 27, 220 (1954).
That concern is real. Consider a hypothetical patent case in which the amount in controversy is low.
The plaintiff nonetheless asserts a claim and, on a
preliminary motion, the trial court makes certain
31 Indeed, the authors of one article examining the Federal Cir-
cuit’s decision in this case offered the following recommendation
as a “practice note” for readers: “To safeguard against appeals
being dismissed for mootness, parties subject to an invalidity
decision in one forum should appeal that decision once it becomes final, even if it is a different order that ends the case.”
“Beware Equitable Doctrine of Issue Preclusion in Multiparty,
Multivenue Patent Campaigns,” JD Supra (Aug. 1, 2024)
https://www.jdsupra.com/legalnews/beware-equitable-doctrineof-issue-6713900/ (last visited Feb. 20, 2025).
21
invalidity determinations adverse to the plaintiff but
with leave to amend. The economics of the situation
might suggest that the parties reach a prompt and
modest settlement, but the Federal Circuit’s holding
in this case would compel the plaintiff to continue litigating the matter because, if left uncorrected, the
preliminary holding could spring to life to bind the
plaintiff in some future proceeding on the theory that
it merged with the stipulated judgments that would
attend to any settlement. See 18 WRIGHT, MILLER &
COOPER, FEDERAL PRACTICE & PROCEDURE § 4423 (3d
ed. 2024) (“The stakes in the first action may be so
small that extensive effort is not reasonable if the
risk is limited to the first action.”); see also, Note, Collateral Estoppel by Judgment, 52 COLUM. L. REV. 647,
657 (1952) (parties may choose to settle for any number of reasons, including the relative size of the
claim).
Second, there can be little doubt that many thousands of litigants have settled cases with prejudice
after early Rule-12(b)(6) decisions. The Federal Circuit’s decision, if left in place, could subject parties in
those lawsuits to unexpected collateral effects. The
Federal Circuit’s holding ignores that reliance interest.
The Federal Circuit’s response to potential problems its holding could create is to suggest that litigants could, at the time they settle, either ask the
district judge to vacate an earlier decision to avoid
22
collateral-estoppel effect or reserve the right to take
an appeal after the dismissal.32 Neither suffices.
The Federal Circuit’s opinion seems to presume
that a district court will vacate early decisions merely
on settling parties’ request. But this Court held in
U.S. Bancorp Mortgage Co. v. Bonner Mall Partnership, 513 U.S. 18, 28 (1994), that courts should do so
only in exceptional circumstances. See also, Aqua
Marine Supply v. AIM Machining, Inc., 247 F.3d
1216 (Fed. Cir. 2001) (no exceptional circumstances
required departure from the general rule of Bancorp that vacatur was inappropriate when parties
had settled action).
The Federal Circuit was also mistaken in assuming that a party can always avoid collateral estoppel
by asking a trial court to vacate its extant orders
when parties settle. A number of courts have held to
the contrary. See, e.g., Watermark Senior Living Retirement Communities, Inc. v. Morrison Management
Specialists, Inc., 905 F.3d 421, 427 (6th Cir. 2018)
(under Michigan law, “judgments can support issue
preclusion even though they are set aside or vacated
upon settlement.”).
The Federal Court’s suggestion that parties could
include in their dismissal stipulations a reservation
of the right to appeal is both unavailing and puzzling.
If the parties have reached the point at which they
are filing a dismissal stipulation, they have
32 Koss Corp. v. Bose Corp. (8a)
23
presumably settled or otherwise resolved their dispute. At that point, there would be no case or controversy between or among them, and a federal court
would have no Article-III jurisdiction.
***
Issue preclusion (collateral estoppel) can serve a
useful function in litigation, but the Court has established strict guidelines for its use in cases, like this
one, governed by federal law. Those guidelines serve
important functions, not the least of which is to avoid
allowing a procedural shortcut to deprive parties of
substantive rights without ever addressing the merits.
It is true that none of the federal courts of appeals
has yet specifically disagreed with the Federal Circuit’s application of merger to find issue preclusion so
as to set up a circuit split. But that should be no impediment to this Court’s review. While the Federal
Circuit’s rule could apply to a broad range of cases, it
will most prominently affect patent cases since patent rights are often the subject of repeated actions
as varied defendants infringe patent rights (and then
defend with invalidity assertions). Given the Federal
Circuit’s jurisdictional monopoly on patent cases, an
error in its adjudication of patent rights will not
likely be the subject of a circuit split. Such an error
is, however, no less likely to create troublesome precedent, and the Federal Circuit has already applied its
errant approach in another appeal. See Koss Corp. v.
24
Vidal, No. 22-2091, 2024 WL 3594417 (Fed. Cir. July
31, 2024).33
Simply stated, the Federal Circuit has gone far
astray from this Court’s requirements, and it shows
no sign of backing off from its mistaken new rule; indeed, in denying rehearing and then citing its holding
in another case, the court has dug in its heels.34
33 As noted above, Bose is seeking a declaratory judgment of
non-infringement in a pending case in the District of Massachusetts. That case has been stayed pending this Court’s review of
this petition and any subsequent merits review. Notably, in a
status report filed in that case, Bose has made clear that it will
request that the district court follow the Federal Circuit’s collateral-estoppel holding in this case. See Koss Corp. v. Bose
Corp., No. 1:20-cv-12193 (D. Mass.) ECF Doc. No. 73 at 2.
34 This case is an ideal vehicle for the Court to consider the pro-
priety of the Federal Circuit’s new rule of collateral estoppel.
The issue is purely legal, and there are no factual issues in dispute. Were the Court to review that legal question, it would definitively resolve the issue of whether collateral estoppel may be
applied to the early determination in Koss Corp. v. Plantronics,
Inc., a determination that would either end the case or direct
the Federal Circuit to address the merits of the appeal as Koss
requested.
25
CONCLUSION
The Court should grant this petition for a writ of
certiorari.
Respectfully submitted,
ERIK HALVERSON
K&L GATES LLP
Four Embarcadero Center
Suite 1200
San Francisco, CA 94111
February 21, 2025
DAVID R. FINE
(Counsel of Record)
K&L GATES LLP
Market Square Plaza
17 North Second Street
18th Floor
Harrisburg, PA 17101
(717) 231-4500
david.fine@klgates.com
APPENDIX
i
TABLE OF APPENDICES
Page
APPENDIX A — OPINION OF THE UNITED
STATES COURT OF APPEALS FOR THE
FEDERAL CIRCUIT, FILED JULY 19, 2024 . . . 1a
APPENDIX B — DENIAL OF REHEARING
OF THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT,
FILED SEPTEMBER 30, 2024 . . . . . . . . . . . . . . . 10a
1a
A
APPENDIX Appendix
A — OPINION
OF THE
UNITED STATES COURT OF APPEALS
FOR THE FEDERAL CIRCUIT,
FILED JULY 19, 2024
UNITED STATES COURT OF APPEALS
FOR THE FEDERAL CIRCUIT
2022-2090
KOSS CORPORATION,
Appellant,
v.
BOSE CORPORATION,
Appellee.
Appeal from the United States Patent and
Trademark Office, Patent Trial and Appeal Board
in No. IPR2021-00297.
2023-1173, 2023-1179, 2023-1180, 2023-1191
KOSS CORPORATION,
Appellant,
v.
BOSE CORPORATION,
Cross-Appellant.
Appeals from the United States Patent and
Trademark Office, Patent Trial and Appeal Board
in Nos. IPR2021-00612, IPR2021-00680.
Decided July 19, 2024
2a
Appendix A
Before Hughes, Stoll, and Cunningham, Circuit Judges.
Hughes, Circuit Judge.
Koss Corp. appeals, and Bose Corp. cross-appeals, the
Patent Trial and Appeal Board’s decisions in IPR202100297, IPR2021-00612, and IPR2021-00680, involving
Koss Corp.’s wireless earphone patents. Because all the
claims in the patents at issue were invalidated in prior
district court litigation, we find the appeals moot and
dismiss.
I
A
Koss Corp. (Koss) is the assignee of U.S. Patent No.
10,368,155 (the ’155 patent), U.S. Patent No. 10,469,934
(the ’934 patent), and U.S. Patent No. 10,206,025 (the ’025
patent). Koss I J.A. 135; Koss II J.A. 226, 258.1 The patents’
common specification discloses a wireless earphone that
communicates with a digital-audio source, such as an iPod,
over an ad hoc wireless network like Bluetooth. Koss I
J.A. 154-55; Koss II J.A. 245-46, 277-78.
B
On July 22, 2020, Koss filed a patent infringement suit
in the District Court for the Western District of Texas
1. For simplicity, citations to the briefs, joint appendix, and
record in Appeal No. 22-2090 are prefaced by Koss I, while citations
to the briefs, joint appendix, and record in Appeal No. 23-1173 are
prefaced by Koss II.
3a
Appendix A
against Bose Corp. (Bose), alleging that Bose infringed
three Koss patents: the ’155 patent, the ’025 patent, and
the ’934 patent. Koss I J.A. 3655. On the same day, Koss
also filed an infringement action concerning the ’155, ’934,
’025, along with other patents against Plantronics, Inc.
(Plantronics). Koss I J.A. 7909. In response, Bose filed a
motion challenging venue in the Western District of Texas.
Def.’s Motion to Dismiss at 1, Koss Corp. v. Bose Corp.,
Case No. 6:20-cv-00661, ECF No. 20 (W.D. Tex. Dec. 17,
2020). Separately, Bose petitioned for inter partes review
(IPR) of all three patents before the Patent Trial and
Appeal Board. Koss I J.A.167-278; Koss I J.A. 4-5.
Then, on December 10, 2020, Bose filed a declaratory
judgment action in the District Court for the District of
Massachusetts seeking a declaration of noninfringement
of the three Koss patents asserted against Bose in the
Western District of Texas. Complaint at 1, Koss Corp.
v. Bose Corp., Civ. Action No. 1:20-cv-12193, ECF No. 1
(D. Mass. Dec. 10, 2020). The case was stayed pending
resolution of Bose’s improper-venue motion in the Western
District of Texas. Koss Corp. v. Bose Corp., Civ. Action No.
1:20-cv-12193, ECF No. 8, 2021 U.S. Dist. LEXIS 122330.
In June 2021, the District Court for the Western
District of Texas dismissed Koss’s complaint against
Bose for improper venue. Order, Koss Corp. v. Bose
Corp., Case No. 6-20-cv-00661, 2021 U.S. Dist. LEXIS
122330, 2021 WL 7541417 (W.D. Tex. June 22, 2021).
Upon dismissal, Koss filed a counterclaim against Bose
in the District Court for the District of Massachusetts
asserting infringement of the same three Koss patents.
Answer and Counterclaims at 9-27, Koss Corp. v. Bose
4a
Appendix A
Corp., Civ. Action No. 1:20-cv-12193, ECF No. 14, 2021
U.S. Dist. LEXIS 122330.
In September 2021, the Massachusetts district court
stayed the case pending resolution of the IPRs, Order,
id., ECF No. 30 (D. Mass. Sept. 3, 2021),which the Board
instituted, Koss I J.A. 408-60, Koss II J.A. 1046-89, 1195912012, and continued the stay until their completion,
Order, Koss Corp. v. Bose Corp., Civ. Action No. 1:20-cv12193, ECF No. 33, 2021 U.S. Dist. LEXIS 122330. The
Massachusetts case remains stayed pending Bose’s IPRs
of the Koss patents, including the appeals of those IPRs
now before us.
During this same period, Koss’s district court
infringement action against Plantronics—involving,
among other patents, the same three patents asserted
against Bose—was transferred to the Northern District
of California. Order, Koss Corp. v. Plantronics, Inc., Case
No. 6:20-cv-00663, 2021 U.S. Dist. LEXIS 97597, ECF No.
45 (W.D. Tex. May 20, 2021). Plantronics moved to dismiss
Koss’s First Amended Complaint on the ground that all
claims of the asserted patents, including all claims of the
’155, ’934, and ’025 patents, are invalid under 35 U.S.C.
§ 101 for claiming patent-ineligible subject matter. Defs.’
Motion to Dismiss First Amended Complaint at 8-17,
22-25, Koss Corp. v. Plantronics, Inc., Case No. 4:21-cv03854, ECF No. 80, 2021 U.S. Dist. LEXIS 97597. The
motion to dismiss was fully briefed. Response, id., ECF
No. 82 (N.D. Cal. Nov. 15, 2021), Reply, id. ECF No. 83
(N.D. Cal. Nov. 22, 2021). The district court granted
Plantronics’s motion, finding all claims of the asserted
patents—including the ’155, ’934, and ’025 patents at issue
5a
Appendix A
here—invalid under 35 U.S.C. § 101.2 Order at 16, id., ECF
No. 88 (N.D. Cal. Nov. 16, 2022).
Following the district court’s invalidation of all of the
patents’ claims, it granted Koss leave to amend. Id. Koss
then filed a Second Amended Complaint in which it reasserted the ’934 and ’025 patents against Plantronics, but
limited its infringement allegations to certain claims that
involved signal strength technology in the patents. Second
Amended Complaint at 16-34, id., ECF No. 91 (N.D.
Cal. Dec. 7, 2022) (First and Second Causes of Action).
Plantronics moved to dismiss the Second Amended
Complaint on the ground that the asserted patents’ claims
are unpatentable under 35 U.S.C. § 101. Defs.’ Motion to
Dismiss Second Amended Complaint at 8-14, 20-25, id.,
ECF No. 93 (N.D. Cal. Dec. 21, 2022). Again, the motion
was fully briefed. Response, id., ECF No. 96 (N.D. Cal.
Jan. 11, 2023); Reply, id., ECF No. 98 (N.D. Cal. Jan. 25,
2023).
Rather than wait for the district court to decide
Plantronics’s second Motion to Dismiss, Koss voluntarily
stipulated to dismiss the litigation with prejudice.
Stipulation at 2, id., ECF No. 101 (N.D. Cal. Aug. 4, 2023).
When doing so, Koss did not ask the district court to
vacate its earlier order finding all claims of the asserted
patents invalid. The district court subsequently entered an
order formally dismissing Koss’s suit against Plantronics
with prejudice. Order, id., ECF No. 102 (N.D. Cal. Aug. 4,
2. The Dismissal Order also invalidated all claims of three
other Koss patents not at issue in these appeals: U.S. Patent Nos.
10,506,325; 10,757,498; and 10,848,852.
6a
Appendix A
2023). The deadline for Koss to appeal the district court’s
final judgment was September 5, 2023. See Fed. R. App.
P. 4(a)(1)(A). Koss did not appeal.
On September 20, 2023, after the Plantronics
dismissal, Bose moved to dismiss the appeals of the
IPRs before us as moot (Appellee’s Mot.), arguing that
Plantronics invalidated the claims at issue in the appeals.
Koss I ECF No. 30; Koss II ECF No. 35. Koss opposed the
motions (Appellant’s Opp.) and Bose replied (Appellee’s
Reply). Koss I ECF Nos. 32, 34; Koss II ECF Nos. 37,
39. Oral arguments in both Koss I and II occurred on
February 6, 2024, addressing both the substance of the
appeals and the issue preclusion issue. Koss I ECF No.
36; Koss II ECF No. 41. We have statutory jurisdiction
under 28 U.S.C. § 1295(a)(1).
II
Issue preclusion is “a purely procedural issue” as
presented here, therefore we apply the law of the regional
circuit—in this case, the Ninth Circuit—with respect to
the effect of a previous judgment. RF Del., Inc. v. Pac.
Keystone Techs., Inc., 326 F.3d 1255, 1261 (Fed. Cir. 2003).3
3. Our “court has developed its own law with respect to res
judicata (including collateral estoppel) in non-patent cases . . . . But
in patent cases, despite our exclusive jurisdiction, we have generally
stated that we look to regional circuit law for general principles of
res judicata.” Uniloc USA, Inc. v. Motorola Mobility LLC, 52 F.4th
1340, 1346 n.3 (Fed. Cir. 2022). Despite this ambiguity, we need not
resolve which circuit’s law should govern here because our law and
Ninth Circuit law are, in relevant respects, the same. See, e.g., Foster
v. Hallco Mfg. Co., 947 F.2d 469, 477 n.7 (Fed. Cir. 1991) (applying
Ninth Circuit law to an issue of res judicata).
7a
Appendix A
III
The Constitution limits the “judicial power” vested in
the courts to “[c]ases” or “[c]ontroversies.” U.S. CONST.
art. III, § 2. “It is well settled that the case-or-controversy
requirement, including mootness, subsists through all
stages of federal judicial proceedings, trial and appellate.”
Synopsys, Inc. v. Lee, 812 F.3d 1076, 1078 (Fed. Cir.
2016) (quotation marks omitted). “[A]n appeal should . . .
be dismissed as moot when, by virtue of an intervening
event, a court of appeals cannot grant any effectual relief
whatever in favor of the appellant.” Calderon v. Moore,
518 U.S. 149, 150, 116 S. Ct. 2066, 135 L. Ed. 2d 453 (1996)
(quotation marks omitted). Thus, if the patent claims at
issue in these appeals are invalid due to the “intervening”
dismissal in Plantronics, Koss is precluded from asserting
its patents’ claims—now and in the future—and these
appeals are moot.
The question before us is whether the Plantronics
district court’s invalidation of all claims of the ’155,
’025, and ’934 patents is final, as Bose contends, or was
superseded by Koss’s Second Amended Complaint, as
Koss contends. See Koss I Appellee’s Mot. 4; Koss I
Appellant’s Opp. 5. Typically, when a district court issues
a final judgment, any interlocutory orders merge with
that final judgment. For instance, in Hartley v. Mentor
Corp., 869 F.2d 1469, 1472 (Fed. Cir. 1989) (applying Ninth
Circuit law), we held that an interlocutory summary
judgment of invalidity merged with the final stipulation
of dismissal with prejudice. In that case, the district court
granted summary judgment that an asserted patent was
invalid. Id. at 1471. When that summary judgment order
8a
Appendix A
issued, it was interlocutory, or non-final, as litigation
was ongoing. Subsequently, the order became final and
appealable when it merged with a stipulated dismissal
with prejudice, which concluded litigation. Id. at 1472
(“[I]ssue preclusion is likely to be based on what was at
the time an ‘interlocutory’ ruling, and generally such
orders become finalized upon entry of the judgment in
the case.”). Because the patentee neither appealed the
summary judgment order, nor sought to have it vacated
by the district court, our court held that the order had
preclusive effect in later litigation against a different
defendant. Id. at 1472-74.
Koss attempts to distinguish this precedent by
arguing that the district court’s ineligibility ruling became
a nullity on the filing of the Second Amended Complaint.
Not so. The Ninth Circuit has made it clear that claims in
prior dismissed complaints need not be raised in amended
complaints for them to be appealable. Lacey v. Maricopa
Cnty., 693 F.3d 896, 927 (9th Cir. 2012) (“[C]ourts have
concluded that the plaintiff does not forfeit the right
to challenge [a] dismissal on appeal simply by filing an
amended complaint that does not re-allege the dismissed
claim.” (quotation marks omitted)). As the Ninth Circuit
explained, a rule requiring repleading is unfair to the
parties and the district court. Id. at 927-28. Consequently,
if claims need not be repleaded to be appealable, then the
order dismissing those claims is not rendered a nullity
and merges into the final judgment. Contrary to Koss’s
understanding, its decision not to reallege all of the
dismissed claims in district court did not alter its ability
to appeal the district court’s order regarding ineligibility
as to the claims not realleged (i.e., did not render the order
9a
Appendix A
an unappealable nullity as to those claims). What altered
Koss’s right to appeal was its own voluntary decision to
dismiss the case with prejudice without reserving a right
of appeal.
The same facts that triggered preclusion in Hartley
are present here. The district court’s invalidity order,
which was interlocutory when issued, merged with the
final judgment dismissing the case with prejudice. See
Headwaters Inc. v. U.S. Forest Serv., 399 F.3d 1047, 1052
(9th Cir. 2005) (A “stipulated dismissal of an action with
prejudice in a federal district court generally constitutes a
final judgment on the merits.”). In other words, while the
invalidity order may not have been final and appealable
when it issued in November 2022, it became final and
appealable in August 2023 when Koss stipulated to the
dismissal of its suit. And as in Hartley, Koss neither
appealed the invalidation nor had it vacated. Cf. 869 F.2d
at 1473 (“Under Ninth Circuit law, to be assured that the
judgment here would have no collateral estoppel effect,
Hartley would have had to have the 3M court vacate its
order, which he failed to do . . . .”).
Koss’s patent claims are thus invalid, removing any
case or controversy and rendering these appeals moot. See
Blonder-Tongue Lab’ys, Inc. v. Univ. of Ill. Found., 402
U.S. 313, 339-40, 91 S. Ct. 1434, 28 L. Ed. 2d 788 (1971).
We, therefore, dismiss.
DISMISSED
COSTS
Costs to Bose.
10a
APPENDIX B —Appendix
DENIALBOF REHEARING
OF THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT,
FILED SEPTEMBER 30, 2024
UNITED STATES COURT OF APPEALS
FOR THE FEDERAL CIRCUIT
2022-2090
KOSS CORPORATION,
Appellant,
v.
BOSE CORPORATION,
Appellee.
Appeal from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in No. IPR202100297.
ON PETITION FOR PANEL REHEARING AND
REHEARING EN BANC
Before Moore, Chief Judge, Lourie, Dyk, Prost, Reyna,
Taranto, Chen, Hughes, Stoll, Cunningham, and
Stark, Circuit Judges.1
Per Curiam.
1. Circuit Judge Newman did not participate.
11a
Appendix B
ORDER
Koss Corporation filed a combined petition for panel
rehearing and rehearing en banc. The petition was
referred to the panel that heard the appeal, and thereafter
the petition was referred to the circuit judges who are in
regular active service.
Upon consideration thereof,
It Is Ordered That:
The petition for panel rehearing is denied.
The petition for rehearing en banc is denied.
The mandate of the court will issue October 7, 2024.
September 30, 2024
Date
For the Court
/s/ Jarrett B. Perlow
Jarrett B. Perlow
Clerk of Court
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.