Robert Freitas of Freitas & Weinberg.

Capital One Financial Corp. has litigated its novel antitrust theory against behemoth IP holding company Intellectual Ventures for more than five years.

It ended Tuesday without even a ruling on the merits from the U.S. Court of Appeals for the Federal Circuit.

The bank was challenging a ruling from U.S. District Judge Paul Grimm of the District of Maryland, but the Washington, D.C.-based appellate court ruled that Capital One was bound by a previous decision from U.S. District Judge Anthony Trenga of the Eastern District of Virginia. Capital One had started to appeal Trenga's decision several years ago but chose to abandon it.

"Given that the description of the alleged 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 issue," Judge William Bryson wrote for a unanimous panel.

The Federal Circuit did not say whether it agreed with Trenga's framing of a relevant market for patents. Nor did it address Grimm's alternate holding: that the Noerr-Pennington doctrine guarantees Intellectual Ventures' right to wield its massive patent portfolio.

It's a tough blow for Latham & Watkins partner Matthew Moore, who argued the appeal for Capital One. He's been saying for years that IV is violating competition laws by allegedly aggregating thousands of poor-quality patents that tread on financial services and then threatening "endless litigation" if its supra-competitive license demands aren't met. The nearly two-hour long argument focused largely on the merits of the antitrust issues.

His opponent, Robert Freitas of Freitas & Weinberg, said the ruling validates what IV's been saying all along. "We argued from the beginning that Capital One should not get a second chance to litigate the claims rejected by Judge Trenga in the Eastern District of Virginia," Freitas said. "Judge Grimm agreed, and the Federal Circuit has now affirmed. It's disappointing that we had to defeat the same claims twice, but we are very pleased with the Federal Circuit's unanimous precedential opinion."

The antitrust claims have been seen in the tech and financial industries as a possible silver bullet against one of the world's largest nonpracticing entities. But while Capital One has successfully defended all 10 of the patents IV asserted, its antitrust counterclaims have now fizzled. Trenga dismissed them on the pleadings, saying Capital One had failed to identify a relevant market for antitrust purposes and failed to show how IV exercised monopoly power within that market.

Capital One began an appeal, but dismissed it and instead tried again with counterclaims in a patent suit IV had filed in Maryland. Grimm was more hospitable.

"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," he wrote at one point.

Grimm ultimately said he would find triable issues as to the relevant market, but held that a jury trial was precluded by Trenga's previous ruling and by the Noerr-Pennington doctrine, which immunizes legitimate litigation activity from antitrust laws.

On Tuesday, Bryson wrote that Intellectual Ventures v. Capital One is a "particularly strong candidate for applying collateral estoppel" because the Maryland case was pending at the same time as the Virginia appeal. Plus, Capital One submitted an appellate brief describing the relevant market as limited to IV's patent portfolio, then withdrew it and took a different position before Grimm, Bryson wrote.

"In that pleading, where Capital One was not facing a claim of collateral estoppel, Capital One did not disclaim Judge Trenga's characterization of the relevant market, but embraced it," Bryson wrote.

Moore had argued that preclusion should not apply, because Trenga had based his decision on two alternative and independent grounds.

Bryson disagreed. "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."

Chief Judge Sharon Prost and Judge Jimmie Reyna concurred in Bryson's opinion.