Courts Must Properly Apply the Presumption in the Means-Plus-Function Analysis
In Dyfan, LLC v. Target Corporation, Appeal No. 21-1725, the Federal Circuit held that where a claim does not use the word “means” and the record contains unrebutted expert testimony that a person of ordinary skill in the art would understand the claim language to describe sufficiently definite structure, a party cannot overcome the presumption that the claim is not drafted in means-plus-function format.
Dyfan sued Target for infringement of various claims of two patents directed to systems for delivering messages to a mobile device based on the user’s location. Target argued that all disputed claims should be construed as means-plus-function claims under 35 U.S.C. § 112 ¶ 6 and that the specification failed to disclose sufficient corresponding structure, rendering all claims indefinite under § 112 ¶ 2. The district court agreed and entered final judgment of invalidity for all asserted claims. Dyfan appealed.
The Federal Circuit reversed the district court’s judgment of invalidity and remanded the case for further proceedings. The Federal Circuit concluded that the district court erred in finding that the claims were drafted in means-plus-function format. The court emphasized the presumption that claims that do not contain the term “means” are not subject to § 112 ¶ 6 and that this presumption can only be overcome if it is shown by a preponderance of the evidence that skilled artisans would not have understood the claim language to recite sufficiently definite structure. The Federal Circuit found that the district court erred in concluding that Target had overcome the presumption. Specifically, the district court improperly ignored key evidence—the unrebutted deposition testimony of Target’s own expert – that a skilled artisan would have understood the claim limitations to connote sufficient structure and that off-the-shelf code was available to perform the recited functions. In reaching this conclusion, the Federal Circuit noted that, unlike in mechanical arts, the specific structure of software code and applications is partly defined by its function.
Only in Rare Circumstances Should the PTAB Raise a Ground of Unpatentability Sua Sponte
In Hunting Titan, Inc. v. Dynaenergetics Europe GmbH, Appeal No. 20-2163, the Federal Circuit held that, in rare circumstances, the Board should sua sponte raise a ground of unpatentability against substitute claims in a motion to amend, such as where evidence of unpatentability is readily identifiable and persuasive.
Hunting Titan, Inc. requested inter partes review of a patent owned by DynaEnergetics based on theories of anticipation and obviousness. The Board instituted and found all original claims unpatentable as anticipated by the prior art Schacherer reference. DynaEnergetics moved to amend the patent to add substitute claims. Hunting Titan opposed the motion to amend, primarily arguing obviousness of the proposed substitute claims over two different prior art references. The Board denied the motion to amend, holding that the substitute claims were anticipated by Schacherer. The Board did not address Hunting Titan’s obviousness grounds. DynaEnergetics requested rehearing and Precedential Opinion Panel review. The Panel granted review to address under what circumstances that Board may raise a ground of unpatentability that a petitioner did not advance or sufficiently develop in opposing a motion to amend.
The Panel held that the Board should sua sponte advance a ground of unpatentability only in rare circumstances, such as where evidence of unpatentability is readily identifiable and persuasive. The Panel specified, as an example of the readily identifiable evidence scenario, circumstances where the record readily and persuasively establishes that substitute claims are unpatentable for the same reasons that corresponding original claims are unpatentable. Turning to the Board’s decision, the Panel found that the record did not contain the readily identifiable and persuasive evidence of anticipation needed to justify the Board raising the Schacherer ground of unpatentability on its own. Hunting Titan appealed to the Federal Circuit.
On appeal, the Federal Circuit affirmed the Panel’s ruling. The court noted that the Panel’s decision to confine the Board’s discretion to sua sponte raise grounds of unpatentability to rare circumstances was not erroneous, and that the types of circumstances identified by the Panel were not inconsistent with Federal Circuit precedent. The court took issue, however, with the Panel’s reasoning, finding the Panel’s reliance on the adversarial nature of IPR proceedings to be problematic. The court also emphasized that its ruling was narrow, noting that Hunting Titan failed to argue on appeal that the Panel had erred in its determination that the readily identifiable evidence circumstance did not apply. In a concurring opinion, Judge Prost explained why, in her view, Hunting Titan likely would have succeeded if that argument had been preserved.