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General Electric Co. v. United Technologies Corporation

United States Court of Appeals, Federal Circuit

July 10, 2019


          Appeal from the United States Patent and Trademark Office, Patent Trial and Appeal Board in No. IPR2016-00531.

          Brian E. Ferguson, Weil, Gotshal & Manges LLP, Washington, DC, argued for appellant. Also represented by Stephen Bosco, Christopher Pepe; Anish R. Desai, New York, NY.

          Michael Valaik, Bartlit Beck Herman Palenchar & Scott LLP, Chicago, IL, argued for appellee. Also represented by Patrick Joseph Coyne, Michael Andrew Holtman, Sydney Kestle, Jeffrey Curtiss Totten, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, Washington, DC; Benjamin Aaron Saidman, Atlanta, GA.

          Before Reyna, Taranto, and Hughes, Circuit Judges.


         General Electric Company petitioned the United States Patent Trial and Appeal Board for inter partes review of U.S. Patent No. 8, 511, 605. United Technologies Corporation is the assignee of the patent. The Board found the claims not obvious in view of the prior art. General Electric appeals. For the reasons discussed below, we hold that General Electric lacks Article III standing and accordingly, we dismiss the appeal.


         Appellee United Technologies Corporation ("UTC") is the assignee of U.S. Patent No. 8, 511, 605 ("the '605 patent"). The '605 patent is generally directed to a gas turbine engine having a gear train driven by a spool with a low stage count low pressure turbine. '605 patent, Abstract. This particular gas turbine engine is designed for use in airplanes and has an axially movable variable area fan nozzle.

         On January 29, 2016, General Electric Company ("GE") filed a petition for inter partes review ("IPR") challenging claims 1 and 2 of the '605 patent on grounds of anticipation and claims 7-11 of the '605 patent on grounds of obviousness. After institution, UTC disclaimed claims 1 and 2, leaving only claims 7-11 at issue. On June 26, 2017, the United States Patent Trial and Appeal Board ("Board") issued a Final Written Decision concluding that the preponderance of the evidence did not show claims 7-11 of the '605 patent to be unpatentable for obviousness. GE timely appealed to this court.

         On December 29, 2017, UTC moved to dismiss GE's appeal for lack of standing. UTC asserted that GE lacked standing because it failed to demonstrate a sufficient injury in fact. In support, UTC pointed to this court's decisions holding that an appellant does not automatically possess standing to appeal an adverse Board decision by virtue of serving its petitions in the challenged IPR. GE submitted a response on January 16, 2018, including the Declaration of Alexander E. Long, GE's Chief IP Counsel and General Counsel of Engineering for GE Aviation ("First Long Declaration"). Mr. Long explained that the commercial aircraft engine business operates on a long life-cycle and that airplane engines are designed to meet certain specifications for certain aircraft. Because the design of aircraft engines can take eight years or more, GE develops new engines based on old designs. Mr. Long stated that, in the 1970s, GE developed a geared turbofan engine with a variable area fan nozzle for NASA. GE asserted that the '605 patent impedes its ability to use its 1970s geared-fan engine design as a basis for developing and marketing future geared turbofan engine designs with a variable area fan nozzle, thereby limiting the scope of GE's engine designs and its ability to compete in a highly regulated industry. Mr. Long also declared that designing around the '605 patent restricts GE's design choices and forced GE to incur additional research and development expenses.

         We denied UTC's motion without addressing the merits and ordered UTC to brief the issue in its responsive appellate brief. The parties subsequently briefed the standing issue. GE argued that the injuries it suffered include statutory estoppel, economic loss, future threat of litigation, and competitive harm. GE relied on the First Long Declaration as evidence to show its injuries. UTC argued that GE suffered no injury in fact because: (1) UTC has not sued or threatened to sue GE for infringement of the '605 patent; (2) GE does not offer evidence of a concrete and particularized economic injury because it has not developed an engine that implicates claims 7-11 of the '605 patent; and (3) statutory estoppel and the competitive standing doctrine do not apply to GE.

         We heard oral argument on November 7, 2018. Much of oral argument focused on whether GE had constitutional standing to appeal and whether general statements made in the First Long Declaration were sufficient to establish standing. We subsequently ordered GE to supplement the First Long Declaration and submit any additional declarations that would provide greater specificity regarding the asserted injury GE contends provides sufficient standing to appeal in this matter. We provided UTC with an opportunity to respond.

         Each party filed its supplemental submission. GE filed an additional declaration from Mr. Long on November 28, 2018 ("Second Long Declaration"). In his second declaration, Mr. Long stated that Boeing requested information from GE and several of its competitors for engine designs for future Boeing aircrafts. Mr. Long also noted that Boeing requested information regarding designs for both geared-fan engines and direct-drive engines.

         In response to Boeing's request, GE researched a geared-fan engine design that "would potentially implicate [UTC's] 605 Patent." Second Long Decl. ¶ 5. GE asserts it "expended time and money researching and further developing" this technology for the potential business opportunity with Boeing. Id. ΒΆ 7. Ultimately, GE chose not to submit to Boeing a geared-fan engine design and instead submitted a design for a direct-drive engine of the type used in GE's current engine designs. The record does not indicate why GE submitted a direct-drive engine design instead of a geared-fan engine design. Nor does Mr. Long state whether GE lost this particular bid. He contends ...

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