  United States Court of Appeals
      for the Federal Circuit
                  ______________________

         INTELLECTUAL VENTURES I LLC,
        INTELLECTUAL VENTURES II LLC,
                Plaintiffs-Appellees

    INVENTION INVESTMENT FUND II, LLC,
INTELLECTUAL VENTURES MANAGEMENT, LLC,
     INVENTION INVESTMENT FUND I, L.P.,
         Third Party Defendants-Appellees

                             v.

    CAPITAL ONE FINANCIAL CORPORATION,
      CAPITAL ONE BANK (USA), NATIONAL
     ASSOCIATION, CAPITAL ONE, NATIONAL
                   ASSOCIATION,
      Defendants/Third Party Plaintiffs-Appellants
                ______________________

                        2018-1367
                  ______________________

    Appeal from the United States District Court for the
District of Maryland in No. 8:14-cv-00111-PWG, Judge
Paul W. Grimm.
                ______________________

               Decided: September 10, 2019
                 ______________________

    ROBERT E. FREITAS, Freitas & Weinberg LLP, Redwood
City, CA, argued for plaintiffs-appellees and third party de-
fendants-appellees. Also represented by JESSICA N. LEAL,
2       INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                        CORP


DANIEL J. WEINBERG.

    MATTHEW J. MOORE, Latham & Watkins LLP, Wash-
ington, DC, argued for defendants/third party plaintiffs-ap-
pellants. Also represented by GABRIEL BELL, ALAN J.
DEVLIN, ADAM MICHAEL GREENFIELD; ALEXANDER REICHER,
CHRISTOPHER S. YATES, San Francisco, CA; ROBERT A.
ANGLE, Troutman Sanders LLP, Richmond, VA.

    MICHAEL MURRAY, Antitrust Division, United States
Department of Justice, Washington, DC, argued for amicus
curiae United States. Also represented by FRANCES
ELISABETH MARSHALL, MAKAN DELRAHIM, ANDREW C.
FINCH, JAMES FREDRICKS, KRISTEN CEARA LIMARZI, ROBERT
NICHOLSON, MARY HELEN WIMBERLY.

    MARK STEPHEN HEGEDUS, Office of General Counsel,
Federal Trade Commission, Washington, DC, for amicus
curiae Federal Trade Commission. Also represented by
ALDEN F. ABBOTT, JOHN DUBIANSKY, JOEL MARCUS,
SUZANNE MUNCK AF ROSENSCHOLD, HAIDEE L. SCHWARTZ.
                ______________________

    Before PROST, Chief Judge, BRYSON and REYNA, Circuit
                           Judges.
BRYSON, Circuit Judge.
   This appeal stems from a patent infringement action
brought in 2014 in the District of Maryland before Judge
Paul W. Grimm. The action was instituted by Intellectual
Ventures I LLC and Intellectual Ventures II LLC against
Capital One Financial Corporation and two other affiliated
companies: Capital One (Bank) USA, National Association;
and Capital One, National Association (collectively
“Capital One”). The action in this case was preceded by a
similar patent infringement action brought by Intellectual
Ventures I LLC and Intellectual Ventures II LLC in 2013
against Capital One in the Eastern District of Virginia
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL      3
CORP


before Judge Anthony J. Trenga. The infringement claims
in both cases were resolved against Intellectual Ventures I
LLC and Intellectual Ventures II LLC, first by the two trial
courts and then on appeal. See Intellectual Ventures I LLC
v. Capital One Fin. Corp., Civil Action No. 1:13-cv-00740,
2014 WL 1513273 (E.D. Va. Apr. 16, 2014), aff’d, 792 F.3d
1363 (Fed. Cir. 2015); Intellectual Ventures I LLC v.
Capital One Fin. Corp., 127 F. Supp. 3d 506 (D. Md. 2015),
aff’d, 850 F.3d 1332 (Fed. Cir. 2017).
     In both cases, Capital One filed antitrust
counterclaims against Intellectual Ventures I LLC and
Intellectual Ventures II LLC, and it filed third-party
antitrust complaints against three other companies
affiliated with IV: Invention Investment Fund II, LLC;
Intellectual Ventures Management, LLC; and Invention
Investment Fund I, L.P. 1 In both cases, the counterclaims
and third-party claims were resolved against Capital One.
The district court in the Virginia case dismissed Capital
One’s antitrust counterclaims and third-party claims for
failure to state a claim on which relief could be granted.
Intellectual Ventures I LLC v. Capital One Fin. Corp., No.
1:13-cv-00740, 2013 WL 6682981 (E.D. Va. Dec. 18, 2013)
(“Trenga Op.”). The district court in the instant case
initially granted Capital One’s motion to add antitrust
counterclaims and third-party claims to the Maryland case,
Intellectual Ventures I LLC v. Capital One Fin. Corp., 99 F.
Supp. 3d 610 (D. Md. 2015), and denied IV’s motion to



   1     For simplicity, the term “IV” will be used to refer
both to the two plaintiff companies (Intellectual Ventures
I LLC and Intellectual Ventures II LLC) and to the group
consisting of the two plaintiff companies and the three af-
filiated third-party defendant companies (Invention In-
vestment Fund II, LLC; Intellectual Ventures
Management, LLC; and Invention Investment Fund I,
L.P.).
4     INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


dismiss those claims, Intellectual Ventures I LLC v. Capital
One Fin. Corp., No. PWG-14-111, 2015 WL 4064742 (D.
Md. July 1, 2015). However, the court subsequently
granted summary judgment against Capital One on all the
antitrust claims. Intellectual Ventures I LLC v. Capital
One Fin. Corp., 280 F. Supp. 3d 691 (D. Md. 2017). We
affirm.
                             I
                             A
    In the Virginia case, IV asserted five patents against
Capital One. After the plaintiffs dropped two of the
patents, three patents remained in issue. The first was
directed to tracking and storing information relating to a
user’s purchases and expenses. The second was directed to
methods and systems for providing customized Internet
content to a user as a function of user-specific information
and the user’s navigation history. The third was directed
to methods of scanning hardcopy images onto a computer.
    In its answer, counterclaims, and third-party claims in
the Virginia case, Capital One alleged antitrust violations
and claimed patent misuse as a defense. In the antitrust
counterclaims and third-party claims, Capital One alleged
that IV was liable for monopolization and attempted
monopolization, in violation of section 2 of the Sherman
Act, 15 U.S.C. § 2, and unlawful acquisition of assets, in
violation of section 7 of the Clayton Act, 15 U.S.C. § 18.
    Capital One alleged in the Virginia case that IV, which
is principally engaged in the business of acquiring patents
and asserting them in litigation, had acquired a huge
patent portfolio, including approximately 3,500 patents
relating to commercial banking practices. According to
Capital One, IV’s business model was to attempt to obtain
large licensing fees from banks by threatening them with
repetitive patent infringement suits. Capital One alleged
that IV concealed the identity of its patents and insisted
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL         5
CORP


that banks such as Capital One take a license to IV’s entire
portfolio of patents on financial services. Capital One
contended that IV knew that many of its patents were
invalid, unenforeceable, and not infringed. Nonetheless,
according to Capital One, IV sought to obtain licensing fees
based on the large size of its patent portfolio and its
willingness to pursue target banks, including Capital One,
through serial lawsuits, imposing huge costs on the banks
to defend the lawsuits. Capital One alleged that IV’s
business model “is not based on the licensing of valuable
patent rights, but rather on the threat of asserting
thousands of patents in a never-ending series of costly and
disruptive patent infringement law suits—pummeling its
victims into submission.” Answer to Complaint at 12, No.
1:13-cv-00740, at 12 (E.D. Va. Oct. 14, 2013).
    Capital One alleged that IV implemented its scheme
through “sham infringement litigation in bad faith,
regardless of the relevance, validity, or enforceability of its
patents or the likelihood of success on the merits at trial,
with the intent of using the federal court process, as
opposed to the outcome of that process, as an anti-
competitive weapon to increase its pricing power in the
relevant market.” Id. at 31. As a result of IV’s tactics,
Capital One alleged, “a rational financial services target
would more likely than not pay for limited patent peace,
even if [IV] does not have a single valid and infringed
patent in its financial services portfolio.” Id. at 16.
     IV moved to dismiss the antitrust counterclaims in the
Virginia case, and Judge Trenga granted the motion.
Capital One alleged in the Virginia case that the relevant
market for antitrust analysis was the “market for
technology enabling business processes common
throughout the commercial banking industry in the United
States.” Id. at 13. The court, however, concluded that
Capital One had not alleged “any of the recognized indicia
of a relevant market.” Trenga Op. at *5. In particular, the
court noted that Capital One did not allege that the
6     INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


proposed market consisted of “an ‘area of effective
competition’ between IV and the commercial banks who are
the alleged victims of IV’s anticompetitive conduct.” Id.
Capital One also did not allege that the proposed market
“contains all, or even any, of the available substitutes for
the technologies included within that proposed market, or
that the included technologies all pertain to the same
aspects of the commercial banking operations, or even to
those at issue in this case.” Id. With respect to the market
definition issue, the court concluded that “as best as the
Court can discern, Capital One’s proposed technology
market equates to IV’s ‘portfolio of 3,500 or more patents
that [IV] alleges cover widely used financial and retail
banking services’ in the United States because IV’s patent
portfolio presents an ‘inescapable threat’ to providers of
financial services.” Id.
     The Virginia court observed that because Capital One
had in effect alleged that there is no commercial market for
IV’s patent portfolio, Capital One’s relevant market
“reduces to what IV relies upon to justify its allegedly
extortionate demands to buy ‘patent peace’ and avoid the
paralyzing costs of ‘wave after wave of burdensome and
expensive litigation.’” Id. For that reason, the court
concluded, “the actual technologies included within the
proposed market, within broad limits, appear nearly
irrelevant, since it is not the substantive, commercial
usefulness or the merits of the technology that defines the
market; but simply the patents in that market used to
threaten Capital One, which consist entirely of IV’s patent
portfolio. Only in that sense are there no ‘substitutes’ for
the patents that IV controls and uses to threaten and
coerce the commercial banks.”           In short, the court
concluded, “Capital One’s proposed market is not a
‘relevant market’ under any recognized antitrust
jurisprudence.” Id.
   Even assuming that Capital One had proposed an
appropriate “relevant market” consisting of the market for
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL      7
CORP


technologies used to provide commercial banking services
in the United States, the Virginia court concluded that
Capital One had failed to allege facts that rendered
plausible its claim that IV wields unlawful monopoly power
within that market. Capital One did not allege that IV had
any particular share of that market, but instead relied on
what it characterized as “direct evidence” of market power
in the form of “supracompetitive prices and restricted
output.” Id. at 6. But the court concluded that Capital One
had not identified any evidence from which to infer that the
licensing fees proposed by IV were supracompetitive or
that the demanded licensing fees reflected unlawful
monopoly power within the context of IV’s right to license
its patents. Id. The court added that Capital One did not
explain how threats of litigation to enforce presumably
valid patents can render license fees unlawful if they would
otherwise be lawful. Id.
    The Virginia court also found that Capital One’s
counterclaims and third-party claims did not include any
allegation that IV sought to foreclose competition, to gain
a competitive advantage, or to destroy a competitor. Id. at
*7. Moreover, the court found, the counterclaims and
third-party claims contained no fact-based explanation of
why IV’s acquisition of presumably valid patents was
unlawful or at what point IV’s enforcement of multiple
patents became an unlawful exercise of monopoly power.
Id.
     A central feature of Capital One’s theory of
monopolization, the Virginia court explained, was that “IV
has engaged in or threatens to engage in, ‘sham litigation’
to enforce a patent portfolio whose patents are, in fact,
either unenforceable or so weak that, absent IV’s ‘hold-up,’
they have limited commercial value.” Id. The court noted,
however, that Capital One had not referred to any specific
litigation history to support that claim or identified any
particular patents that IV “has attempted or threatened to
enforce that have expired, been cancelled or adjudicated to
8     INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


be invalid.” Id. And because IV and Capital One do not
compete in any relevant market, the court concluded that
“it cannot be said that IV’s object is to use this or any other
litigation to interfere with the business relationships of a
competitor.” Id.
     Under those circumstances, the Virginia court held,
Capital One has not alleged facts that would plausibly
place this litigation within any recognized exception” to the
so-called Noerr-Pennington doctrine, which—with limited
exceptions—protects private parties from antitrust
liability based on even unsuccessful litigation attempts to
enforce laws with potentially anti-competitive effects. Id.
(citing E.R.R. Presidents Conference v. Noerr Motor
Freight, Inc., 365 U.S. 127 (1961), and United Mine
Workers v. Pennington, 381 U.S. 657 (1965)).
    In the end, the court stated, “Capital One’s claim of
monopolization reduces simply to IV’s alleged ability, with
its economic resources and patent portfolio, to credibly
threaten serial litigation, not for the purpose of enforcing
its patents, but rather to bludgeon Capital One into a
licensing agreement that could not otherwise be obtained
or justified based on the merits of its patents, were they to
be dispersed individually among many holders.” Trenga
Op. at *7. If IV were to engage in the kind of endless,
unsuccessful litigation described by Capital One, the court
added, IV would be likely to incur legal liability. But “the
antitrust laws appear ill suited as a remedy for what
Capital One fears, and relief for any such liability would
more likely come through various doctrines of tort liability,
statutory fees or judicial sanctions.” Id. at *8.
    With respect to Capital One’s Clayton Act claim, the
Virginia court noted that section 7 of the Clayton Act can
apply to the acquisition of patents, as it does to the
acquisition of other assets, but only if the acquisition of the
patents itself substantially lessens competition, and not
where the anticompetitive effects arise after the
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL      9
CORP


acquisition.   Because Capital One alleged that the
anticompetitive effects arose from IV’s litigation threats
and not from the patent acquisitions themselves, the court
held that Capital One had failed to allege any facts that
made it plausible that the effect of IV’s patent acquisition
“may be to substantially lessen competition.” Id. at *9.
    With respect to IV’s patent infringement claims
against Capital One, the Virginia court subsequently held
that two of the three litigated patents were directed to
ineligible subject matter. As to the third, the court issued
a claim construction that resulted in the parties’
stipulating to non-infringement. Intellectual Ventures I
LLC v. Capital One Fin. Corp., No. 1:13-cv-00740, 2014 WL
1513273 (E.D. Va. Apr. 16, 2014).
    IV appealed the Virginia court’s rulings on patent
ineligibility and claim construction. This court affirmed
the district court’s rulings as to all three patents.
Intellectual Ventures I LLC v. Capital One Bank (USA), 792
F.3d 1363 (Fed. Cir. 2015). Capital One initially cross-
appealed from the dismissal of its antitrust counterclaims
and third-party claims in the Virginia case. However,
Capital One later dismissed its cross-appeal from the
adverse judgment in the Virginia case after the district
court in the Maryland action granted Capital One’s motion
to add its antitrust counterclaims and third-party claims
in this case.
                             B
     While the Virginia case was still pending, IV brought
the present patent infringement action against Capital
One in the District of Maryland, asserting five new patents.
Those patents included three directed to methods, systems,
and apparatuses for dynamically managing extensible
markup language data; one directed to systems and
methods for accessing a user’s remotely stored data and
files; and one directed to methods, devices, and systems for
controlling access rights to data.
10    INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


    Capital One moved to add antitrust counterclaims and
third-party claims of monopolization and attempted
monopolization under section 2 of the Sherman Act, as well
as unlawful asset acquisition under section 7 of the Clayton
Act. In support of its motion, Capital One contended that
it was alleging a different relevant market from the market
alleged in the Virginia case, and that discovery in the
Virginia case and events that occurred during and after the
Virginia action justified its new counterclaims and third-
party claims.
    As in the Virginia case, Capital One alleged that IV had
employed a business model of acquiring thousands of
patents dealing with technology essential to the services
offered by commercial banks and then seeking to force
banks to license IV’s entire portfolio of financial services
patents for a fixed number of years at a high price.
    The Maryland district court granted Capital One’s
motion to add the counterclaims and third-party claims.
The court held that Capital One had alleged a plausible
relevant market consisting of IV’s portfolio of patents on
financial services, that Capital One had sufficiently alleged
that IV has monopoly power in that market, and that IV
had intentionally acquired patents on existing products in
the financial services industry so that it could “hold up
banks that have substantially invested in those existing
product designs.” Intellectual Ventures I LLC, 99 F. Supp.
3d at 626. The court also rejected IV’s argument that
Capital One’s counterclaims and third-party claims should
be dismissed on the ground that they were barred by
collateral estoppel stemming from the district court’s
ruling in the Virginia case.       Accordingly, the court
permitted the antitrust claims to remain in the case.
    Of the five patents on which IV initially based its
infringement claims in the Maryland case, IV voluntarily
dismissed one at the outset; the district court dismissed
two others as foreclosed by collateral estoppel based on a
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL       11
CORP


decision by the United States District Court for the
Southern District of New York; and the court held that the
remaining two patents were directed to unpatentable
subject matter under 35 U.S.C. §101. The court permitted
IV to take an interlocutory appeal from its ruling
dismissing all of the infringement claims, and this Court
affirmed. Intellectual Ventures I LLC v. Capital One Fin.
Corp. 850 F.3d 1332 (Fed. Cir. 2017).
   Following the appeal, IV moved for summary judgment
on Capital One’s antitrust claims in the Maryland case.
The district court granted the motion.        Intellectual
Ventures I LLC v. Capital One Fin. Corp., 280 F. Supp. 3d
691 (D. Md. 2017).
    As in the Virginia case, the Maryland district court
characterized Capital One’s theory of the case as based on
IV’s aggregation of a large number of patents, concealment
of those patents, and insistence on licenses to its patent
portfolio at what Capital One called “supracompetitive”
prices. According to Capital One’s theory, IV exerted
leverage over Capital One by threatening serial litigation
that would be so expensive that the bank would be forced
to accede to IV’s demands. Id. at 696–97.
    Capital One characterized the relevant market for
purposes of its antitrust analysis as the market consisting
of IV’s portfolio of financial services patents. Capital One’s
expert, economist Fiona Scott Morton, testified that IV had
a monopoly in that market, and that Capital One (as well
as the other targeted banks) could not realistically “design
around” the patents. According to Professor Scott Morton,
that was because IV did not disclose the patents that
related to particular technology and because the banks had
already invested sunk costs into particular technology that
would make any design-around process prohibitively
expensive. See id. at 699.
    Professor Scott Morton further stated that IV’s pattern
of aggregating patents, concealing its ownership of those
12    INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


patents, and threatening serial litigation enabled IV “to
exercise ‘hold-up’ power by demanding take-it-or-leave-it
supracompetitive prices to license its financial services
portfolio.” Id. at 700. While acknowledging that IV’s
patent portfolio did not constitute a classic relevant market
for antitrust purposes, Professor Scott Morton analogized
“IV’s financial services patent portfolio to a ‘cluster market’
that IV promotes as a single product (for which there are
no close substitutes) at a supracompetitive price.” Id. She
asserted that IV exercises monopoly power in that market,
even though she acknowledged that no bank, including
Capital One, has agreed to purchase a license to the entire
portfolio, and that IV has yet to prevail in any of its patent
suits against banks. Id.
     IV’s response, as set forth in the opinion of its expert,
Richard Gilbert, was to challenge Professor Scott Morton’s
market definition, “arguing that the proper definition is
not a ‘cluster’ of financial services patents constituting a
single product, but rather a collection of patents that relate
to multiple distinct technology markets.” Id. The flaw in
Capital One’s analysis, according to Professor Gilbert, was
“its failure to analyze the distinct technology markets for
which IV does have patents to determine whether there are
alternative close substitutes that Capital One could turn to
in order to avoid having to license from IV.” Id. Professor
Gilbert contended, moreover, that there was no market
price at all for the patent portfolio, as no party had accepted
IV’s invitation to take a license at the price IV asked.
    Judge Grimm acknowledged that Professor Gilbert’s
analysis of the relevant market “is firmly grounded in
commonly used antitrust analysis.”             Id. at 701.
Nonetheless, noting that the question of the identity of the
relevant market in an antitrust action is typically a
question of fact, Judge Grimm ruled that he could not
conclude, as a matter of law, that Professor Scott Morton’s
relevant market analysis was incorrect, particularly in
light of the difficulty that would be presented by any effort
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL       13
CORP


“to perform the analysis of available substitutes that
Professor Gilbert calls for to determine whether there are
close substitutes to which Capital One could turn to avoid
the reach of IV’s portfolio.” Id. at 703. The court concluded
that a jury could reasonably conclude that “IV does, in fact,
market its patents as a portfolio, rather than a collection of
individual patents relating to a number of discrete
technology markets[].” Id. at 704.
    The court noted that “it is hard to deny that there is
something concerning from an antitrust perspective about
the way in which IV engages in its licensing business.” Id.
Judge Grimm then stated that if the only issue raised in
IV’s summary judgment motion were “whether there are
genuine disputes of material fact that would entitle it to
judgment as a matter of law on the issues of possession of
monopoly power in a relevant market and the willful
acquisition or maintenance of that power as distinguished
from growth or development as a consequence of a superior
product, business acumen, or historic accident,” he would
deny the motion and allow the case to proceed to trial. Id.
    However, Judge Grimm held that there were two
dispositive legal issues, independent of the merits of
Capital One’s antitrust theories, that required the court to
grant IV’s summary judgment motion. Those issues were:
(1) the immunity from antitrust liability provided by the
so-called Noerr-Pennington doctrine; and (2) the collateral
estoppel effect of the decision of the Virginia district court
with respect to the antitrust issues raised by Capital One
in the Maryland case.
                              1
    In the district court, IV argued that the Noerr-
Pennington doctrine barred Capital One’s antitrust claims
altogether. Capital One responded that Noerr-Pennington
immunity did not apply to IV’s conduct, because litigation
was only a part of IV’s broader monopolistic scheme.
Noerr-Pennington immunity, according to Capital One,
14    INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


would not insulate the entire scheme from antitrust
scrutiny. In particular, Capital One argued that IV’s
aggregation and concealment of patents was actionable,
because that activity “would be anticompetitive even if IV
had never filed a lawsuit.” Id. at 706.
    Judge Grimm rejected Capital One’s argument. He
observed that Capital One’s theory of antitrust liability
under the Sherman Act relied on its allegations of “a
carefully orchestrated campaign of patent aggregation,
concealment, and sham litigation” on the part of IV. Id.
With regard to Capital One’s Clayton Act claim, Judge
Grimm noted that while acquisition and aggregation of
assets is the focus of a Clayton Act cause of action, the
acquisition of assets is actionable under the Clayton Act
“only where ‘the effect of such acquisition may be
substantially to lessen competition, or to tend to create a
monopoly,’” 15 U.S.C. § 18. To establish that effect, Judge
Grimm explained, Capital One relied on IV’s purported
“campaign” to force banks to license IV’s patent portfolio,
which could not succeed absent the threat of litigation. 280
F. Supp. 3d at 706. Thus, the court concluded that the
threat of litigation was “an integral component of IV’s
alleged strategy underlying all of Capital One’s claims.” Id.
at 706-07.
     In the alternative, Capital One argued that IV is not
entitled to Noerr-Pennington immunity from antitrust
liability, because IV’s conduct fell within the “sham
litigation” exception to the Noerr-Pennington doctrine. See
id. at 707–08. The district court acknowledged that Noerr-
Pennington immunity does not apply if a party brings an
action, such as a patent infringement action, that is a
“mere sham to cover what is actually nothing more than an
attempt to interfere directly with the business
relationships of a competitor.”       Noblepharma AB v.
Implant Innovations, Inc., 141 F.3d 1059, 1068 (Fed. Cir.
1998).
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL      15
CORP


     Based on the Supreme Court’s decision in Professional
Real Estate Investors, Inc. v. Columbia Pictures Industries,
Inc., 508 U.S. 49 (1993) (“PREI”), the court found the sham
litigation exception inapplicable in this case. 280 F. Supp.
3d at 708–16. Under the PREI decision, the district court
ruled, a lawsuit does not qualify as sham litigation unless
the lawsuit is “‘objectively baseless in the sense that no
reasonable litigant could realistically expect success on the
merits,’ and ‘the litigant’s subjective motivation must be to
interfere directly with the business relationships of a
competitor.’” Id. at 709 (quoting PREI, 508 U.S. at 60–61).
     The court concluded that Capital One “cannot establish
that IV’s litigation against it was objectively baseless
because there were too many indicia of probable cause.” Id.
at 714. Noting that a court-appointed special master had
concluded that IV would succeed on the merits on two of its
patent claims, the court determined that a reasonable
litigant could legitimately expect to succeed on the merits,
and it rejected Capital One’s argument that the loss before
Judge Trenga in the Virginia case meant that IV could no
longer reasonably believe that it would prevail in the
Maryland case. Id. In addition, Judge Grimm noted that
both of IV’s suits were filed before the Supreme Court’s
decision in Alice Corp. Pty. v. CLS Bank International, 573
U.S. 208 (2014), which formed the basis for his ruling
against IV on the issue of patent ineligibility. Because IV’s
infringement claims were not objectively baseless, and
because IV’s patent litigation was “integral to Capital
One’s antitrust claims,” the court held that IV was entitled
to Noerr-Pennington immunity from antitrust liability.
280 F. Supp. 3d at 716.
                             2
    Judge Grimm’s second ground for granting summary
judgment was that collateral estoppel from the judgment
16       INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                         CORP


in the Virginia case barred Capital One’s antitrust claims
in the Maryland case. 2
    Analyzing the ruling in the Virginia case, Judge
Grimm determined that Judge Trenga had ruled that IV’s
portfolio of financial services patents was not a relevant
market for purposes of Capital One’s antitrust claims.
Based on that determination, Judge Grimm ruled that
Capital One would not be permitted to relitigate that issue
in the Maryland case, even though Capital One sought to
introduce new facts in the Maryland case to support its
relevant market claim. See id. at 716–24.
    Although Capital One contended that its position as to
the relevant market was not the same in the Maryland case
as in the Virginia case, Judge Grimm found that the
transcript from the oral argument on the motion to dismiss
before Judge Trenga “demonstrates that Judge Trenga
paraphrased the relevant market to confirm his
understanding of what Capital One alleged, and that
Capital One had confirmed that his definition was
accurate.” Id. at 718–19.
    Judge Grimm noted that in the Maryland case Capital
One had alleged “different facts to support a finding that
[IV’s] patents qualify as a relevant market for antitrust
purposes.” Id. at 719. In the Virginia case, Judge Grimm
explained, Capital One had argued that IV’s patent
portfolio qualified as a relevant market “because Capital



     2    IV initially raised claim preclusion, as well as issue
preclusion, as a defense to the Sherman Act claims in the
Maryland case. Judge Grimm, however, rejected IV’s claim
preclusion argument in his ruling allowing Capital One to
file its antitrust claims. 99 F. Supp. 3d at 617–20. IV has
not raised claim preclusion as to the Sherman Act claims
in its brief on appeal, and we therefore do not address that
issue.
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL       17
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One had a business need to avoid litigation, which it only
could do by licensing the patents in the portfolio.” Id. In
the Maryland case, he observed, “instead of relying solely
on the need to avoid litigation, which Judge Trenga already
found insufficient to define a relevant market, Capital One
also contends that ‘continu[ing] to provide the online
services they already offer without paying the cost-
prohibitive licensing fees to the Intellectual Venture
companies—the only source of such licenses—,’ is a
business necessity.” Id. Although Judge Grimm initially
allowed Capital One to assert its antitrust claims based on
that change in the factual allegations, he ultimately
rejected Capital One’s argument regarding business
necessity on summary judgment based on the absence of
any evidence to support Capital One’s new theory
regarding the relevant market.
   Judge Grimm explained his ruling as follows:
   [D]iscovery has concluded, and to date, IV’s patent
   litigation has not led to Capital One (or any other
   company) licensing the portfolio of thousands of
   financial services patents that IV amassed, as none
   of IV’s patent claims have resulted in a judgment
   in IV’s favor. Nor is there any other evidence that
   Capital One has to license IV’s patent portfolio or
   has been unable to do business because it has not
   licensed the patents. Certainly, Capital One may
   feel compelled to license the patents to avoid
   litigation, but Judge Trenga already concluded
   that avoiding litigation is not a sufficient business
   necessity to define a relevant market.
Id. For that reason, the court concluded that the new
factual allegations before the court had not materially
altered the alleged relevant market from the relevant
market that Capital One asserted in the Virginia case.
    Before Judge Grimm, Capital One argued that
collateral estoppel did not apply to Judge Trenga’s rulings
18    INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


in the Virginia case, because Judge Trenga had ruled
against Capital One on two grounds—the failure to identify
an appropriate relevant market, and the failure to allege
facts making plausible Capital One’s claim that IV wields
unlawful monopoly power within that market. Capital One
argued that collateral estoppel is not appropriate when the
prior judgment was based on two separate grounds, either
of which would have been sufficient to support the
judgment. Judge Grimm, however, concluded that under
Fourth Circuit law collateral estoppel was applicable in
such a situation, and that the existence of alternative and
independent grounds for decision in a prior case did not bar
the application of collateral estoppel to either ruling.
Accordingly, the court entered judgment on the antitrust
counterclaims in favor of IV based on collateral estoppel, in
addition to its reliance on Noerr-Pennington immunity. Id.
at 719-24.
                             II
    On appeal, Capital One challenges the district court’s
application of collateral estoppel on the relevant market
issue and its ruling that the Noerr-Pennington doctrine
immunizes all of IV’s challenged conduct from antitrust
scrutiny. IV defends both grounds on which the district
court based its summary judgment ruling, and it contends
that Capital One’s theory of antitrust liability has other
fatal infirmities as well. Because we affirm the district
court’s judgment based on collateral estoppel, we do not
decide the issues presented by the parties as to the Noerr-
Pennington doctrine or Capital One’s theory of antitrust
liability.
                             A
    With regard to the Maryland district court’s ruling on
the issue of collateral estoppel, Capital One argues that the
Virginia district court dismissed Capital One’s antitrust
claims on two alternative and independent grounds.
Under governing principles of the law of judgments,
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL        19
CORP


Capital One argues, when a prior judgment is based on two
independent grounds, collateral estoppel does not apply to
either ground of decision, and the losing party in the first
action is not estopped from relitigating either of those two
issues in subsequent litigation.
     In a case such as this one, involving general principles
of the law of judgments that do not implicate questions
within this court’s exclusive jurisdiction, we apply the law
of the regional circuit in which the district court is located.
Phil-Insul Corp. v. Airlite Plastics Co., 854 F.3d 1344, 1353
(Fed. Cir. 2017); United Access Techs., LLC v. CenturyTel
Broadband Servs. LLC, 778 F.3d 1327, 1330 n.1 (Fed. Cir.
2015); TecSec, Inc. v. Int’l Bus. Machs. Corp., 731 F.3d
1336, 1341 (Fed. Cir. 2013). The District of Maryland is in
the Fourth Circuit, so Fourth Circuit law governs the
collateral estoppel issue in this case.
    Judge Grimm characterized Judge Trenga’s judgment
in the Virginia case as being based on two independent
grounds: Capital One’s failure to identify an appropriate
relevant market, and Capital One’s failure to allege the
exercise of monopoly power within that relevant market.
Nonetheless, Judge Grimm rejected Capital One’s
argument that collateral estoppel was inapplicable to
either issue. He concluded, instead, that under Fourth
Circuit law collateral estoppel would apply in this setting
to a determination in a prior case even if that
determination were only one of two alternative grounds for
dismissal in the prior action. 280 F. Supp. 3d at 723.
    In their briefs on appeal, the parties dispute whether
Judge Grimm properly applied Fourth Circuit law on
collateral estoppel. IV argues that collateral estoppel
applies to both of the alternative grounds of decision relied
on by the Virginia court; Capital One argues that collateral
estoppel applies to neither ground.
    The Fourth Circuit has adopted the widely recognized
principle that collateral estoppel (also known as issue
20     INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                       CORP


preclusion) applies to an issue or fact presented in a case
only if
     (1) the issue or fact is identical to the one
     previously litigated; (2) the issue or fact was
     actually resolved in the prior proceeding; (3) the
     issue or fact was critical and necessary to the
     judgment in the prior proceeding; (4) the judgment
     in the prior proceeding is final and valid; and (5)
     the party to be foreclosed by the prior resolution of
     the issue or fact had a full and fair opportunity to
     litigate the issue or fact in the prior proceeding.
In re Microsoft Corp. Antitrust Litig., 355 F.3d 322, 326
(4th Cir. 2004); Ramsay v. U.S. Immigration &
Naturalization Serv., 14 F.3d 206, 210 (4th Cir. 1994); see
also Intellectual Ventures I LLC v. Capital One Fin. Corp.,
850 F.3d at 1337.
     Capital One argues that the third of the five
requirements for applying collateral estoppel—that the
issue or fact in question must have been “critical and
necessary to the judgment” in the prior proceeding—was
not satisfied in this case. Asserting that Judge Trenga
resolved the antitrust claims against Capital One in the
Virginia case on two separate and independent grounds,
Capital One argues that neither of those two grounds was
“critical and necessary to the judgment” in that case, and
accordingly neither ground can give rise to collateral
estoppel.
                              B
    To begin with, the premise of Capital One’s argument
is wrong. The two issues on which Judge Trenga based his
dismissal order are not independent and alternative
grounds of decision, but are integrally related. Specifically,
the presence of a relevant antitrust market is critical both
to whether a relevant market has been identified and to
whether the defendant possesses monopoly power in a
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL        21
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relevant market. As Judge Trenga explained, the first
element of the offense of monopolization under section 2 of
the Sherman Act is “the possession of monopoly power in
the relevant market.” Trenga Op. at *4 (citing United
States v. Grinnell Corp., 384 U.S. 563, 570–71 (1966)). It
is artificial to divide that element into (1) the possession of
monopoly power and (2) a relevant market, because the
possession of monopoly power is meaningless without
reference to the market in which that power is exercised.
     What Judge Trenga ruled was that Capital One failed
to plausibly allege a proper relevant antitrust market and
failed to plausibly allege that IV wields monopoly power
within that antitrust market. The requirement of a
relevant antitrust market is a necessary component of both
determinations; therefore, Judge Trenga’s finding that a
relevant antitrust market was not plausibly pleaded is
fatal to Capital One’s position on both issues. Judge
Trenga’s finding on the relevant market issue therefore
satisfied the requirement, for collateral estoppel purposes,
that an issue of fact decided in the prior proceeding be
critical and necessary to the judgment in that proceeding.
     This analysis is supported by comment i and
illustration 16 in section 27 of the Second Restatement of
Judgments. The Second Restatement generally provides
that if a judgment of a court “is based on determinations of
two issues, either of which standing independently would
be sufficient to support the result, the judgment is not
conclusive with respect to either issue standing alone.”
Restatement (Second) of Judgments § 27 cmt. i (1982).
However, that general rule is subject to an express caveat
that if “the first action, even though decided on alternative
grounds, necessarily adjudicated the issue” in dispute in
22       INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                         CORP


the second action, the determination in the first action
would be conclusive in the second. Id. at cmt. i & illus. 16. 3
    This case fits that exception. Although Judge Trenga
separately concluded that Capital One had not proposed an
appropriate relevant market and that it had not plausibly
alleged that that IV wields unlawful monopoly power
within that market, both grounds required a showing of a
relevant antitrust market, and therefore Judge Trenga’s
decision “necessarily adjudicated the issue” of the
appropriate relevant market. Judge Grimm was therefore
correct in holding that Judge Trenga’s determination on
the relevant market issue in the Virginia case was
conclusive on that issue in the Maryland action.
                               C
    Even assuming, as Capital One argues, that the two
issues decided by Judge Trenga are not integrally related,
but instead should be treated as independent and
alternative grounds for decision, we still conclude that
Judge Grimm was correct in applying collateral estoppel to
Judge Trenga’s relevant market ruling, although our
analysis differs somewhat from Judge Grimm’s.




     3  Although that principle has arisen infrequently in
federal cases, one example in the case law is In re McCall,
76 B.R. 490, 495 & n.5 (E.D. Pa. 1987). In that case, the
court rejected the argument that collateral estoppel should
not apply to alternative findings of fraud and unjust en-
richment; the court held that it was clear that the finding
of unjust enrichment depended on the finding of fraud. Be-
cause a finding of fraud was necessary to both grounds of
decision in the first case, the court held that it was appro-
priate to apply collateral estoppel to that finding in the sec-
ond case.
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL       23
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                              1
    In In re Microsoft Corp. Antitrust Litigation, the Fourth
Circuit embraced the general principle that “where the
court in the prior suit has determined two issues, either of
which could independently support the result, then neither
determination is considered essential to the judgment.
Thus, collateral estoppel will not obtain as to either
determination.” 355 F.3d at 328 (quoting Ritter v. Mount
St. Mary’s Coll., 814 F.2d 986 (4th Cir. 1987)); see also Lisa
Lee Mines v. Director, Office of Workers’ Compensation
Programs, 86 F.3d 1358, 1363 (4th Cir. 1996) (“[H]oldings
in the alternative, ‘either of which independently would be
sufficient to support the result, . . . [are] not conclusive
with respect to either issue standing alone.”) (quoting
Restatement (Second) of Judgments § 27 cmt. i (1982));
C.B. Marchant Co. v. E. Foods, Inc., 756 F.2d 317, 319 (4th
Cir. 1985) (“It was once the rule that ‘if a court decided a
case on two grounds, each is a good estoppel.’ However, the
modern rule is that if a judgment rests on independent
grounds, either of which would support the result, the
judgment is not conclusive with respect to either issue
standing alone.” (citations omitted)). 4
    IV seeks to distinguish the Microsoft case, as did Judge
Grimm, on the ground that it involved offensive collateral
estoppel rather than defensive collateral estoppel.
Offensive collateral estoppel is issue preclusion in which
the plaintiff seeks to bar the defendant from relitigating an
issue on which the defendant has lost against a different
plaintiff in a prior case. Defensive collateral estoppel is


    4   This court has previously characterized the Fourth
Circuit’s position as declining to give preclusive effect to a
prior court’s ruling if it was one of the several alternative
holdings that were each independently sufficient to sup-
port a judgment. See Phil-Insul Corp., 854 F.3d at 1356–
57 n.2; TecSec, 731 F.3d at 1343–44.
24    INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


issue preclusion in which the defendant seeks to bar the
plaintiff from relitgating an issue on which the plaintiff has
lost against a different defendant in a prior case. See
Parklane Hosiery Co. v. Shore, 439 U.S. 322, 326 n.4, 329
(1979). This case, IV points out, involves defensive
collateral estoppel because IV, the counterclaim defendant,
was urging the application of estoppel against Capital One,
the counterclaim plaintiff, which had lost on that issue in
a prior case.
     Courts are more cautious about applying offensive
collateral estoppel than defensive collateral estoppel. That
is because of the “greater possibility for unfairness from the
use of offensive collateral estoppel,” due to the risks that
the defendant may not have had the same incentive to
defend vigorously in the first action and may not have had
procedural opportunities in the first action that could have
produced a different result in that case. Microsoft, 355
F.3d at 326; see also Parklane Hosiery, 439 U.S. at 331–33.
For that reason, courts are accorded discretion to deny
offensive collateral estoppel when the circumstances
suggest that applying the doctrine would be unfair to the
defendant. See Parklane Hosiery, 439 U.S. at 329–33.
     The Fourth Circuit in Microsoft, an offensive collateral
estoppel case, recognized the distinction between offensive
and defensive collateral estoppel and acknowledged the
reasons that a court might decline to apply offensive
collateral estoppel in particular cases. To be sure, the
Microsoft court did not predicate its decision against
preclusion on the fact that the case involved offensive
collateral estoppel. However, the court acknowledged that
“[t]he caution that is required in application of offensive
collateral estoppel counsels that the criteria for foreclosing
a defendant from relitigating an issue or fact be applied
strictly” in that context. Microsoft, 455 F.3d at 327.
    Citing IV argues that the Fourth Circuit’s decision in
Ritter v. Mount St. Mary’s College, 814 F.2d 986 (4th Cir.
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL        25
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1987), indicates that the court would approve the use of
defensive collateral estoppel in a case such as this one. The
Ritter case, however, arose in a different procedural
posture from this one. In Ritter, the district court decided
two issues in favor of the defendant at an early stage of the
case. On appeal, the court of appeals affirmed on one of the
issues but did not address the other. On remand, the
district court reinstated its ruling on the second issue and
entered a final judgment for the defendant. On the second
appeal, the Fourth Circuit held that it was permissible for
the district court to adopt its earlier ruling on the second
issue, given that the issue had been fully litigated before
the same district court at an earlier stage of the same case.
See 814 F.2d at 993–94.
    The Fourth Circuit in the Microsoft case distinguished
Ritter, but not on the ground that it involved defensive
rather than offensive collateral estoppel. Instead, the court
emphasized that Ritter “involved no prior judgment from
another proceeding but rather a prior ruling in the same
case.” 355 F.3d at 328 (emphasis in original). The
Microsoft court then explained that the court in Ritter was
“essentially applying a law-of-the-case principle” even
though it “called it collateral estoppel, and applied it in the
exceptional circumstances of that case, where the parties
were the same, the issues were the same, the facts were the
same, and even the court was the same.” Id. Based on the
unusual circumstances in the Ritter case and the Fourth
Circuit’s later characterization of that decision, we are
satisfied that the Fourth Circuit has not adopted a general
exception, for cases involving defensive collateral estoppel,
to the rule denying collateral estoppel effect to alternative
and independent determinations.
    Some circuits have held, consistent with IV’s argu-
ment, that each alternative determination that supported
the first court’s ruling forms an independent ground for col-
lateral estoppel in the second case, at least when a party is
asserting defensive collateral estoppel. See Jean Alexander
26    INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


Cosmetics, Inc. v. L’Oreal USA, Inc., 458 F.3d 244, 251–54
(3d Cir. 2006); Gelb v. Royal Globe Ins. Co., 798 F.2d 38, 45
(2d Cir. 1986) (citing Irving Nat’l Bank v. Law, 10 F.2d 721,
724 (2d Cir. 1926)); In re Westgate-Cal. Corp., 642 F.2d
1174, 1176–77 (9th Cir. 1981); cf. Deweese v. Town of Palm
Beach, 688 F.2d 731, 734 (11th Cir. 1982) (“Normally, each
alternative basis would form an independent ground for
collateral estoppel. . . . In this case, however, the existence
of alternative grounds makes the application of offensive
collateral estoppel problematic.”).
    That position is the one taken in the First Restatement
of Judgments. That Restatement posited that “[w]here the
judgment is based upon matters litigated as alternative
grounds, the judgment is determinative on both grounds,
although either alone would have been sufficient to support
the judgment.” Restatement of Judgments § 68 cmt. n
(1942). However, the Second Restatement of Judgments
rejected the position taken on that issue by the First Re-
statement. Based in large part on the reasoning of the Sec-
ond Circuit’s decision in Halpern v. Schwartz, 426 F.2d 102
(2d Cir. 1970), the Second Restatement adopted, as a gen-
eral rule, the position that “[i]f a judgment of a court of first
instance is based on determinations of two issues, either of
which standing independently would be sufficient to sup-
port the result, the judgment is not conclusive with respect
to either issue standing alone.” Restatement (Second) of
Judgments § 27 cmt. i & reporter’s note, at 270 (1982).
    Several justifications have been advanced in support of
the rule that preclusive effect should not be accorded to one
of several alternative grounds of decision. The justifica-
tions given in the Halpern case and echoed in the Second
Restatement are (1) it would unfairly burden a party to re-
quire it to take an appeal challenging multiple grounds of
decision simply to avoid the preclusive effect of one of those
grounds; (2) such a party might not foresee the risk of a
potential collateral estoppel effect from the ruling in ques-
tion and would have little other motivation to take an
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL        27
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appeal from an alleged error that had no effect on the judg-
ment; (3) if the reviewing court is confident as to the cor-
rectness of one of the alternative grounds of decision, it
might not feel constrained to give rigorous consideration to
the alternative grounds; and (4) the requirement of taking
an appeal to avoid collateral estoppel in possible future
suits would create extra appellate litigation even though
the future suits might never come to pass. Halpern, 426
F.2d at 105–06; see Restatement (Second) of Judgments
§ 27 cmt. i.
     Several circuits have adopted the general rule es-
poused in the Second Restatement with regard to the ap-
plication of collateral estoppel in the case of alternative and
independent grounds for decision. See Peabody Coal Co. v.
Spese, 117 F.3d 1001, 1008 (7th Cir. 1997) (en banc); Baker
Elec. Coop. v. Chaske, 28 F.3d 1466, 1475–76 (8th Cir.
1994) (applying North Dakota law); Society of Separation-
ists, Inc. v. Herman, 939 F.2d 1207, 1213–14 n.25 (5th Cir.
1991); Turney v. O’Toole, 898 F.2d 1470, 1472 n.1 (10th Cir.
1990). In light of the above analysis, we conclude, princi-
pally based on the Microsoft case, that the Fourth Circuit
would align itself with the latter circuits and, as a general
rule, would decline to give preclusive effect in a later case
to each of several alternative and independent grounds for
decision in the first litigation.
    That, however, is not the end of the story. In most of
the cases in which a question has been raised as to the pre-
clusive effect of alternative grounds of decision, the moving
party has argued that preclusion on one of those alterna-
tive grounds would result in judgment for that party or at
least would advance its litigation position. In some cases,
however, any one of the alternative grounds that were in-
dependently sufficient to dispose of the first action would
also be independently sufficient to decide the second. In
that circumstance, the policies underlying the non-preclu-
sion rule adopted in the Second Restatement are signifi-
cantly diluted.
28    INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


    The policy considerations invoked in the Halpern case
and the Second Restatement have force with regard to
cases in which only one of several grounds for decision in
the first case is pertinent to the second. However, the case
for applying collateral estoppel to alternative determina-
tions is much stronger when all of the alternative determi-
nations in the first case would be independently sufficient
to dispose of the second case. In such a case, since all the
alternative determinations would be pertinent to the sec-
ond case, the losing party in the first case would not be dis-
couraged from taking an appeal because of the presence of
a strong alternative determination that is irrelevant to the
second case. Likewise, a party would be less likely in such
a setting to take an otherwise improvident appeal simply
out of a desire to avoid preclusion on one of multiple ad-
verse rulings.
    In such a setting it has been suggested that the non-
preclusion rule of the Second Restatement should give way.
See 18 Charles Alan Wright, Arthur R. Miller & Edward H.
Cooper, Federal Practice & Procedure § 4421, at 624 (3d ed.
2016) (suggesting that preclusion should be available “so
long as each and any of the findings that were inde-
pendently sufficient to dispose of the first action would also
be independently sufficient to dispose of the second ac-
tion”). Such an exception to the non-preclusion rule makes
sense, as there is no material difference between the situa-
tion in which each of the determinations on which the ad-
verse decision in the first case was based would lead to an
adverse decision in the second case, and a situation in
which preclusion is based on a single adverse determina-
tions in the earlier case.
    The few cases that have addressed the issue have held
that collateral estoppel applies in this setting, even in cir-
cuits that have not adopted the First Restatement rule.
See Zeno v. United States, No. DKC 09-0544, 2009 WL
4910050, at *5 (D. Md. Dec. 11, 2009) (applying collateral
estoppel to alternative grounds for dismissal in prior case:
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL         29
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“[D]espite the fact that the court’s previous decision rested
on three alternative grounds for dismissal—personal juris-
diction, venue, and immunity—all of the grounds apply in
this case.”), aff’d, 451 F. App’x 268 (4th Cir. 2011); NOW v.
Operation Rescue, 747 F. Supp. 760, 768 (D.D.C. 1990)
(where “the Virginia court’s alternative determinations are
adopted in their entirety as alternative holdings in this
judgment,” all three alternative holdings of the Virginia
court “are entitled to preclusive effect in this litigation”).
    Although no appellate decision in the Fourth Circuit
has adopted this exception to the general rule of non-pre-
clusion for alternative determinations, the exception has
not been rejected by the Fourth Circuit (or any decision of
this court applying Fourth Circuit law), and it has been
adopted by at least one district court within the Fourth Cir-
cuit. See Zeno v. United States, 2009 WL 4910050, at *5.
     As noted, the Fourth Circuit in Microsoft did not adopt
an inflexible rule that collateral estoppel is unavailable as
to alternative and independent determinations, no matter
what the circumstances. In light of the significant differ-
ences between cases in which only one of several alterna-
tive grounds would be applicable in the second litigation,
and cases in which all of the alternatives would be applica-
ble in that litigation, we think it likely that the Fourth Cir-
cuit would adopt the exception to the general rule of non-
preclusion that we have described.
     The case for applying collateral estoppel when all of the
alternative grounds for decision in the first case apply in
the second is even stronger when the two cases are co-pend-
ing. In that instance, the losing party in the first case is
fully aware of the danger that an estoppel will be applied
in the second case and has every incentive to seek review
of the adverse decision in the first case. The policy against
duplicative litigation is at its strongest where the losing
plaintiff in the first case is in a position to make a conscious
30       INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
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choice whether to pursue an appeal in the first case or
begin anew by bringing a second action.
     The Second Circuit held that there was no reason to
deny collateral estoppel effect to a prior judgment “in an
instance where the plaintiff was pursuing the two actions
simultaneously and thus could fully anticipate the poten-
tial barring effect of the earlier judgment in deciding not to
appeal from [the prior] determination.” Williams v. Ward,
556 F.2d 1143, 1154 (2d Cir. 1977). In an opinion for the
court in the Williams case, Judge Friendly explained that
the concern that a party “would be forced to clairvoyant an-
ticipation of the effects of determined issues on future in-
determinate collateral litigation, which neither party can
be sure will occur, and would be forced to take cautionary
appeals even when the later litigation might never occur,
is clearly not applicable here, where Williams was prose-
cuting both actions at once.” Id. (quotation marks omitted);
see also Winters v. Lavine, 574 F.2d 46, 68 (2d Cir. 1978)
(same). 5 In light of the Second Circuit’s analysis, we think
this consideration makes it even more likely that the
Fourth Circuit would hold collateral estoppel applicable to
both of two alternative grounds, when both grounds would
be dispositive in the second case and when the two cases
were co-pending at the time the plaintiff decided to proceed
with the second case after an adverse decision in the first.
                               2
    We must now determine how that preclusion principle
applies to the facts of this case. As noted, Judge Grimm
found that Judge Trenga had granted judgment for IV on



     5  The Second Circuit in Williams and Winters ex-
plained that a case in which the party subject to estoppel
is prosecuting both relevant actions at once does not raise
the concerns noted in Halpern. See Winters, 574 F.2d at
68; Williams, 556 F.2d at 1154.
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL      31
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two alternative grounds: (1) that Capital One failed to iden-
tify a relevant market for antitrust purposes, and (2) that
Capital One failed to plausibly allege that IV had monopoly
power in a relevant market. Judge Grimm concluded that
either one of those alternative grounds would be sufficient
to defeat Capital One’s Sherman Act claims, because the
issues before the court in the Maryland case are the same
as those that were decided by Judge Trenga in the Virginia
case. If Judge Grimm’s determination on that score is cor-
rect, the rule on collateral estoppel that we have discussed
would support Judge Grimm’s conclusion that summary
judgment should be granted to IV on Capital One’s Sher-
man Act claims.
     Capital One, however, disputes Judge Grimm’s finding
that the issues in the two cases are the same. Capital One
argues that the relevant market asserted in the Maryland
case is different from the relevant market asserted in the
Virginia case, and for that reason collateral estoppel can-
not be applied with regard to that issue. In particular, Cap-
ital One contends that in the Maryland case the relevant
market consisted of IV’s portfolio of patents on financial
services for commercial banks, while in the Virginia case
the relevant market consisted of the “market” or “ex post
market” for “technology enabling business processes com-
mon throughout the commercial banking industry in the
United States.” 6 Because the two proposed relevant anti-
trust markets are different, Capital One argues, the deci-
sion in the Virginia case should not be given collateral




    6   The parties use the term “ex post” to refer to goods
or processes that are already in commercial use, rather
than inventions directed to goods or processes that have
not yet been commercialized.
32       INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
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estoppel effect in the Maryland case even under the legal
standard that IV advocates. 7
    When Judge Trenga sought clarification of Capital
One’s definition of the market, Capital One’s counsel ex-
plained that the market consisted of the patents owned by
IV relating to commercial banking services, and that IV
controlled 100 percent of that market because there was
“no way to get around them.”




     7   Capital One also asserts in passing that it alleged
new facts in the Maryland case. Collateral estoppel cannot
be defeated, however, by offering evidence in the second
proceeding that could have been adduced in the first pro-
ceeding but was not; absent materially changed circum-
stances, the ruling in the initial case is preclusive. See
Oyeniran v. Holder, 672 F.3d 800, 807 (9th Cir. 2012) (“The
introduction of new evidence on a matter previously re-
solved is not an exception to collateral estoppel.”); Hicker-
son v. City of N.Y., 146 F.3d 99, 108 n.6 (2d Cir. 1998);
Yamaha Corp. of Am. v. United States, 961 F.2d 245, 254–
55 (D.C. Cir. 1992); Jones v. United States, 466 F.2d 131,
136 (10th Cir. 1972). That is true even if a different legal
theory is advanced in the second action. See United States
v. United Techs. Corp., 782 F.3d 718, 728–29 (6th Cir.
2015); Falconer v. Meehan, 804 F.2d 72 (7th Cir. 1986).
Capital One argues that there is evidence that IV acquired
additional patents in the period between the two cases.
Judge Grimm found that IV had not acquired any new pa-
tents in the relevant investment funds since Capital One
filed its antitrust claims in the Virginia action. 280 F.
Supp. 3d at 718. In any event, however, Capital One does
not suggest how any marginal increase in the number of
patents in IV’s portfolio is material to the antitrust issues
in this case.
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL       33
CORP


    Judge Trenga noted that Capital One did not allege
that the proposed market in the Virginia case “contains all,
even any, of the available substitutes for the technologies
included within that proposed market or that the included
technologies all pertain to the same aspects of the commer-
cial banking operations, or even to those at issue in this
case.” Trenga Op. at *5. Tracking counsel’s representa-
tion, Judge Trenga concluded that “Capital One’s proposed
technology market equates to IV’s ‘portfolio of 3,500 or
more patents that [IV] alleges cover widely used financial
and retail banking services’ in the United States because
IV’s patent portfolio presents an ‘inescapable threat’ to pro-
viders of financial services.” Id.
    Unlike cases in which customers are “locked in” by
business necessity to using particular patents, Judge
Trenga found that Capital One’s relevant market reduces
to what IV relies on to justify its allegedly extortionate de-
mands to buy ‘patent peace’ and avoid the paralyzing costs
of ‘wave after wave of burdensome and expensive litiga-
tion.’” Id. Judge Trenga added that “the only ‘business ne-
cessity’ alleged is, in essence, the business need to avoid
future litigation.” Id. He stated, further, that the “actual
technologies included within the proposed market, within
broad limits, appear nearly irrelevant, since it is not the
substantive, commercial usefulness or the merits of the
technology that defines the market; but simply the patents
in that market used to threaten Capital One, which consist
entirely of IV’s patent portfolio.” Id. Only in that sense,
Judge Trenga explained, “are there no ‘substitutes’ for the
patents that IV controls and uses to threaten and coerce
the commercial banks.” For that reason, Judge Trenga
concluded, “Capital One’s proposed market is not a ‘rele-
vant market’ under any recognized antitrust jurispru-
dence.” Id.
   In the Maryland case, Capital One alleged that the rel-
evant antitrust market was “the 3,500 patents in [IV’s] fi-
nancial-services portfolio.” Capital One argues that the
34    INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


relevant market alleged in the Maryland case is different
from the relevant market alleged in the Virginia case. For
that reason, Capital One argues, Judge Trenga’s ruling
that the relevant market asserted in the Virginia case was
not a relevant antitrust market is not entitled to preclusive
effect in the proceedings before Judge Grimm.
     What Capital One’s argument overlooks is that Judge
Trenga’s analysis of the relevant market issue was based
on his interpretation of Capital One’s argument (based in
part on counsel’s representations) regarding the relevant
market in the Virginia case. What Judge Trenga decided
in the Virginia case is that a market consisting of the
“3,500 or more patents that [IV] alleges cover widely used
financial and retail banking services in the United States”
is not a relevant market for antitrust purposes. It is that
decision to which Judge Grimm attached preclusive effect
in the Maryland case. Given that the description of the al-
leged market on which Judge Trenga predicated his ruling
is identical in all material respects to the market alleged in
the Maryland case, it was appropriate for Judge Grimm to
give preclusive effect to Judge Trenga’s ruling on that is-
sue.
     Although Capital One faults Judge Trenga for his char-
acterization of its relevant market allegations, Capital One
in its brief on appeal in the Virginia case, which was filed
before Capital One withdrew its cross-appeal in that case,
stated that its allegations supported “a distinct market”
that was “limited to IV’s portfolio because IV alleged that
its portfolio license is indispensable to commercial bank-
ing.” Br. of Cross-Appellants at 68, Intellectual Ventures I
LLC v. Capital One Bank (USA), 792 F.3d 1363 (Fed. Cir.
2015). Thus, in that pleading, where Capital One was not
facing a claim of collateral estoppel, Capital One did not
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL       35
CORP


disclaim Judge Trenga’s characterization of the relevant
market, but embraced it. 8
    At bottom, what Capital One is suggesting is that (1)
Judge Grimm should have looked behind Judge Trenga’s
characterization of the relevant market asserted by Capital
One; (2) he should have concluded that Judge Trenga’s
characterization of Capital One’s position was erroneous;
and (3) he should have found that the relevant markets
claimed in the two cases were therefore not the same. But



    8    Capital One also argues that the courts’ character-
ization of the “business necessity” issue was different in the
two cases, and that the alleged relevant markets were
therefore necessarily different. In the Virginia case, Capi-
tal One notes, the court referred to the “business need to
avoid future litigation,” while in the Maryland case, the
court referred not only to Capital One’s need to avoid liti-
gation, but also to its need to continue providing on-line
banking services without paying cost-prohibitive licensing
fees.
    The difference in the manner in which the two courts
referred to business need does not reflect a difference in the
relevant market alleged in the two cases. Capital One
made it clear from the outset of the Virginia case that it
needed to continue providing banking services and that
IV’s tactics and its accumulation of patents adversely af-
fected its ability to do so. See Answer to Complaint at 13,
17, 27–28, 32–34, Intellectual Ventures I LLC v. Capital
One Fin. Corp., No. 1:13-cv-00740 (E.D. Va. Oct. 14, 2013).
Judge Trenga’s point in describing the “business necessity”
to avoid future litigation was simply that Capital One was
alleging that the injury to its commercial operations re-
sulted from IV’s litigation threats, not from any valid IV-
owned patents that actually covered Capital One’s banking
practices.
36    INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


Judge Trenga’s characterization was based on the position
taken by Capital One in the proceedings before him. It is
only now that Capital One has sought to distance itself
from that position in order to suggest that the Maryland
case is different from the Virginia case.
    Moreover, even if Judge Trenga were in error in
characterizing the alleged relevant market in the case
before him, that would not be a basis for granting relief to
Capital One from Judge Grimm’s preclusion decision. A
collateral estoppel determination is based on what the
prior court ruled, and the prior court’s ruling cannot be
dissected to determine whether it was somehow based on
an incorrect legal or factual basis.
     Rules of preclusion assume the correctness of the prior
judgment. All that matters is that the issue has actually
been litigated and has been validly and finally determined.
See City of Arlington v. FCC, 569 U.S. 290, 297 (2013)
(“even an erroneous judgment is entitled to res judicata
effect”); Federated Dep’t Stores, Inc. v. Moitie, 452 U.S. 394,
398 (1981) (“Nor are the res judicata consequences of a
final, unappealed judgment on the merits altered by the
fact that the judgment may have been wrong . . . .”); FCA
US, LLC v. Spitzer Autoworld Akron, LLC, 887 F.3d 278,
288–89 (6th Cir. 2018) (“issue preclusion prevents the
relitigation of wrong decisions just as much as right ones”);
RecoverEdge L.P. v. Pentecost, 44 F.3d 1284, 1296 (5th Cir.
1995) (“It is well settled . . . that even arguably erroneous
judgments have preclusive effect if the requirements for
collateral estoppel are satisfied.”).
    If Capital One had wanted to dispute Judge Trenga’s
characterization of the relevant antitrust market, it could
have done so by challenging that characterization on
appeal from the judgment in that case. Instead, as noted,
Capital One agreed in its appeal brief in the Virginia case
(before withdrawing its appeal) that IV’s patent portfolio
represented a relevant antitrust market. Under those
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL       37
CORP


circumstances, Capital One cannot now contend that Judge
Trenga mischaracterized the relevant antitrust market
asserted in that case and that Judge Trenga’s rulings in
that case therefore should not be given collateral estoppel
effect in this one.
     For the reasons given by the Second Circuit in Wil-
liams v. Ward and Winters v. Lavine, this case is a partic-
ularly strong candidate for applying collateral estoppel,
because of the co-pendency of the Virginia and Maryland
lawsuits. Capital One sought to file its antitrust claims in
the Maryland case while Capital One’s cross-appeal in the
Virginia case was still pending. When Judge Grimm
granted Capital One’s motion to add its antitrust claims in
the Maryland case, Capital One moved to dismiss its cross-
appeal from the Virginia judgment. IV objected to the mo-
tion to dismiss on the ground that Capital One was seeking
“to prevent the district court decision below from having its
effect as a final judgment by an Article III court, and (to
try) to get the same issues to go forward in what Capital
One believes to be a more favorable forum.” Cross-Appel-
lees’ Response to Cross-Appellant’s Motion to Dismiss the
Cross-Appeal at 6–7, Intellectual Ventures I LLC v. Capital
One Fin. Corp. (Fed. Cir. 2015) (Nos. 2014-1506, -1515).
    Capital One thus withdrew its cross-appeal in the Vir-
ginia case in favor of litigating its antitrust claims in the
Maryland case despite the known risk—pointed out by
IV—that abandoning its appeal from the adverse decision
in the Virginia case could result in a collateral estoppel bar
to its claims in the Maryland case. While Capital One’s
decision to withdraw its appeal may be understandable in
light of Judge Grimm’s order allowing Capital One to liti-
gate its antitrust claims in the Maryland action, it was
nonetheless an action taken with full awareness of the risk
of preclusion based on the adverse rulings in the Virginia
case.
38    INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL
                                                      CORP


    Applying the principles of collateral estoppel as we be-
lieve the Fourth Circuit would apply them, we sustain the
judgment as to Capital One’s Sherman Act claims based on
collateral estoppel. As discussed above, the two issues de-
cided by Judge Trenga are not alternative and independent
grounds for decision. And even if the two issues are re-
garded as alternative grounds for decision, each was inde-
pendently sufficient to dispose of the first action and
therefore would be independently sufficient to dispose of
the second.
                             D
     For similar reasons, collateral estoppel applies to Cap-
ital One’s claim under section 7 of the Clayton Act.
    In addition to finding that Capital One’s antitrust the-
ories failed on the “relevant market” issue, Judge Trenga
dismissed Capital One’s claim under section 7 of the Clay-
ton Act on the ground that Capital One had failed to “allege
that IV’s acquisitions, standing alone, have lessened com-
petition as if, for example, IV had acquired all substitutes
or competing technologies.” Trenga Op. at *9. The anti-
competitive effects about which Capital One complained,
Judge Trenga explained, arose from IV’s litigation threats,
based on the patents it had accumulated. For that reason,
Judge Trenga stated, “the complained of anticompetitive
effects do not arise from the acquisition of the patents, but
from conduct that post-dates the acquisition.” Id.
     Like Judge Trenga, Judge Grimm based his ruling on
all the antitrust claims—including the Clayton Act claim—
on the same failure to allege or prove a relevant antitrust
market. Like Judge Trenga, Judge Grimm also held that
“while patent acquisition and aggregation is the focus of
the Clayton Act claim, acquisition is actionable under the
Clayton Act only where ‘the effect of such acquisition may
be substantially to lessen competition, or to tend to create
a monopoly.’” 280 F. Supp. 3d at 706 (citing 15 U.S.C. § 18).
And like Judge Trenga, Judge Grimm found that the
INTELLECTUAL VENTURES I LLC v. CAPITAL ONE FINANCIAL       39
CORP


requisite effect on competition depended on IV’s “cam-
paign,” i.e., that the threat of patent litigation was “an in-
tegral component of IV’s alleged strategy underlying all of
Capital One’s claims.” Id.
     Capital One argues that because the Virginia court
held that Capital One had not sufficiently pleaded either a
relevant antitrust market or anticompetitive acquisitions,
the Virginia court’s dismissal did not depend on either
ground alone, and neither was entitled to be accorded pre-
clusive effect in the Maryland case. As noted above, how-
ever, because both were viable grounds for decision in the
Maryland case, and because Judge Grimm relied on both of
those grounds, the rule against applying collateral estoppel
to alternative grounds of decision would not apply in this
instance.
    Accordingly, we affirm the judgment of the district
court on all of Capital One’s antitrust claims on collateral
estoppel grounds. For that reason, we find it unnecessary
to reach the parties’ dispute regarding the Noerr-Penning-
ton doctrine or IV’s arguments on the merits of Capital
One’s antitrust claims.
                        AFFIRMED
