Yesterday, Chief Judge Stark addressed whether "judicial estoppel" prevents a defendant from taking one position in an uninstituted IPR petition and asserting a contradictory position during claim construction in the district court:
[Plaintiff] Sequoia contends that [defendant] Red Hat is judicially estopped from arguing for a narrower construction than it proposed during the IPR . . . . Judicial estoppel is only appropriate when: (1) the party to be estopped is asserting a position that is irreconcilably inconsistent with one she previously asserted; (2) the party changed her position in bad faith, i.e., with an intent to play fast and loose with the court, and (3) the use of judicial estoppel is tailored to address the affront to the court's authority or integrity and no lesser sanction would adequately remedy the situation. See Montrose Med. Grp. Participating Sav. Plan v. Bulger, 243 F.3d 773, 777-78 (3d Cir. 2001). "[A] party has not displayed bad faith for judicial estoppel purposes if the initial claim was never accepted or adopted by a court or agency." Id. at 778.
Judge Stark found that asserting an "inconsistent" position alone was not enough to show bad faith:
[E]ven if the Court were to agree with Sequoia [that estoppel may apply even if the PTAB declined to institute the IPR], and were also to find that Red Hat's position is inconsistent with what it advocated in the IPR, the record is devoid of any indication of bad faith on Red Hat's part or any affront to the integrity of the courts from permitting Red Hat to press its current position.
Thus, he rejected the judicial estoppel argument.
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