Federal Circuit Affirms PTAB’s Claim Construction That Is in Accord With Prior Federal Circuit Construction
In Knowles Electronics LLC v. Cirrus Logic, Inc., Appeal No. 2016-2010, the Federal Circuit upheld the Patent Trial and Appeal Board’s claim construction in an inter partes reexamination, where the Board applied the broadest reasonable interpretation standard and did not depart from a prior Federal Circuit construction.
In an inter partes reexamination, the Board affirmed an examiner’s rejection of certain claims as anticipated based on its construction of the preamble term “package,” which it found to be limiting. The Board also affirmed the rejection of proposed claims for lack of an adequate written description because the specification did not identify a “solder reflow process” as recited in the proposed claims and such a process was not commonly understood at the time of the disclosure.
The Federal Circuit affirmed the Board’s decision on both issues. The Federal Circuit noted that the Board properly considered extrinsic evidence when construing the term “package” and found the Board’s construction “in accord” with the definitions adopted by the Federal Circuit in a prior decision concerning the same patent. The Federal Circuit did not discuss whether its prior decision was binding on the Board. Applying the pre-AIA § 112 written description requirement, the Federal Circuit found that the Board’s written description decision was supported by substantial evidence showing that a person of skill in the art would not have recognized that the inventor possessed solder pads “configured to” connect to a printed circuit board through a reflow process. The court reiterated that “it is not sufficient for purposes of the written description requirement that the disclosure, when combined with the knowledge in the art, would lead one to speculate as to the modifications that the inventor might have envisioned, but failed to disclose.”
Judge Newman dissented. Judge Newman concluded that the Board’s claim construction was not consistent with the prior Federal Circuit decision. Further, she argued, Federal Circuit decisions construing claims are binding on the Board, even in proceedings where the broadest reasonable interpretation applies.
Federal Circuit Cites to Collateral Estoppel in Affirmance of District Court’s Claim Construction
In Ottah v. Fiat Chrysler, Appeal No. 2017-1842, the Federal Circuit affirmed the District Court’s claim construction, noting that the Federal Circuit had previously ruled on the scope of the claim in Ottah v. VeriFone Systems, Inc., 524 F. App’x 627 (Fed. Cir. 2013). The Federal Circuit also held that general disclosures in the specification and statements that describe embodiments as non-limiting do not broaden claims that were narrowly prosecuted.
Ottah, a pro se litigant, owns a patent on a removable book holder for use in cars and in other locations. Ottah alleged that the back-up cameras included in the defendants’ cars infringed his patent. The district court granted summary judgment of non-infringement to one group of defendants (“MSJ defendants”) and dismissed the complaint for failure to state a claim as to a second group of defendants (“MTD defendants”).
In a previous case, the Federal Circuit held that the lone claim of Ottah’s patent excluded fixed mounts that require tools for removal and that prosecution history estoppel prevents the claim from encompassing such fixed mounts. The Federal Circuit found no error in the previous claim construction and no reason to depart from the rules of collateral estoppel or stare decisis. Because the MSJ defendants had shown that their cameras use fixed mounts that require tools for removal, the district court’s grant of summary judgment of non-infringement was affirmed.
In affirming the motion to dismiss, the Federal Circuit agreed with the district court that the claim of Ottah’s patent cannot plausibly be construed to include or be the equivalent of a camera. Although the specification includes a statement that a book platform “may also be used to support such items as audio/video equipment, PDAs, or mobile phones, [and] cameras” and some boilerplate statements that the invention is not necessarily limited to the described embodiments, the Federal Circuit found that the record negates access to the equivalency of cameras and books because the scope of examination was limited to prior art book holders. Accordingly, the Federal Circuit affirmed the district court’s dismissal of the complaint with prejudice.
A Terminal Disclaimer Does Not Raise a Presumption that a Continuation Patent is Patentably Indistinct Over Parent
In SimpleAir, Inc. v. Google LLC., Appeal No. 2016-2738, the Federal Circuit held that filing a terminal disclaimer to overcome an obviousness-type double patenting rejection is not an admission that the continuation claims are patentably indistinct over the parent patent.
SimpleAir owns several patents directed to push notification technology linked by continuation applications, all claiming priority to a single provisional application. During prosecution, SimpleAir filed terminal disclaimers for each child to overcome obviousness-type double patenting rejections. In serial litigation, SimpleAir asserted several patents from the family against Google, resulting in three prior judgments of non-infringement. The district court dismissed SimpleAir’s fourth suit against Google—involving two additional familial patents—based on claim preclusion. The court determined that the terminal disclaimers constituted an admission that the patents-in-suit were patentably indistinct from the previously asserted patents. The district court never compared the claims of the newly asserted patents to those of the previously adjudicated patents.
The Federal Circuit reversed, holding that a district court cannot presume that a terminally disclaimed continuation patent presents the same cause of action as a parent based on the filing of a terminal disclaimer alone. Because there is no prohibition on broadening claims in a continuation patent subject to a terminal disclaimer, the terminal disclaimer itself is not a sufficient basis to support a finding of claim preclusion. The Federal Circuit stated, however, that filing a terminal disclaimer to overcome a double patenting rejection is “a strong clue” that the claims in the continuation lack a patentable distinction over the parent. The Federal Circuit remanded to provide the district court an opportunity to compare the claims of the asserted patents with the previously adjudicated claims and determine if the new claims give rise to a different cause of action.
Broadest Reasonable Interpretation Encompasses All Embodiments in the Absence of Support Specifically Excluding an Embodiment
In Steuben Foods, Inc. v. Nestle USA, Inc., Appeal No. 2017-1290, the Federal Circuit reiterated that in an inter partes review proceeding, the broadest reasonable interpretation of a claim term must encompass all embodiments unless there is support for a narrower interpretation.
Nestlé requested an inter partes review of a patent owned by Steuben. The claims at issue were directed to an aseptic packaging sterilization tunnel compartmentalized into zones with varying sterilant concentration levels recited as ratios (e.g., 5 to 1). In construing the claim term “sterilant concentration levels,” Steuben contended that the proper construction was “the amount of sterilant in the volume of pressurized gas within the zone.” The Board rejected this construction and used the broadest reasonable interpretation, construing “sterilant concentration levels” to be the levels measured “at any point within the sterilization tunnel—including the ‘residual’ concentration on bottle surfaces.” The Board found all challenged claims unpatentable for obviousness.
The Federal Circuit affirmed the Board’s decision, finding that Steuben’s proposed construction restricted the claim term to a specific embodiment disclosed in the specification. However, the specification also disclosed residual concentration of sterilant on the lids of bottles. Stueben failed to point to any language in the claims or the specification that supported its position that the claims encompass one embodiment, but not the other. Thus, the Federal Circuit found that the broadest reasonable construction of the term must encompass both the sterilant concentration level “in air” as well as on the bottle surfaces. Because Steuben’s interpretation would have impermissibly restricted the claim term to a specific embodiment, the Federal Circuit affirmed.
Collateral Estoppel Applies to Claim Terms Previously Construed in Related Patents
In Nestlé USA, Inc. v. Steuben Foods, Inc., Appeal No. 2017-1193, the Federal Circuit held that collateral estoppel applied to the construction of a claim term that had been previously construed in an appeal involving a related patent with similar claims.
Prior to the current appeal, Nestlé appealed the Board’s construction of the term “aseptic” in an IPR proceeding involving a related patent owned by Steuben Foods. In the prior appeal, the Federal Circuit vacated the Board’s construction of the claim term “aseptic” and relied on binding lexicography in the specification to construe the term to mean the “FDA level of aseptic.” The patent at issue in this appeal was directed to systems for aseptic packaging of food products. In this case, the Board did not use the same construction of the term “aseptic” as determined by the Federal Circuit in the prior appeal.
The Federal Circuit relied on collateral estoppel in determining that the term “aseptic” should be construed in the same manner as in the prior appeal. The Federal Circuit noted that neither party “pointed to any material difference between the two patents or their prosecution histories” that would give rise to different claim construction issues. Further, “the two patents  provide identical lexicography for the term ‘aseptic’ in their specifications.” In addition, the Federal Circuit emphasized that collateral estoppel is not limited to patent claims that are identical and that it is actually the identity of the issues that were litigated that determines whether collateral estoppel should apply. The Federal Circuit vacated the Board’s construction and remanded for further proceedings.
Disclosure of a Species in a Predictable Art May Provide Written Description Support for Genus Claims
In Hologic, Inc., v. Smith & Nephew, Inc., Appeal No. 2017-1389, the Federal Circuit held that the disclosure of a species may provide written description support for a claimed genus when the field of invention is a predictable art.
Hologic requested inter partes reexamination of Smith & Nephew’s patent that claims a method of removing uterine tissue using an endoscope. Hologic argued that the priority PCT application does not provide sufficient written description for the limitation to a “first channel having a light guide permanently affixed therein.” Hologic therefore argued that the priority chain was broken and that the PCT application constituted invalidating prior art. The examiner agreed, and in rejecting the claims, found the PCT application’s specific disclosure of a “fibre optic bundle” does not support the broad genus of the “light guide” limitation. The Board, however, reversed the examiner’s rejection and Hologic appealed.
The Federal Circuit affirmed the Board’s ruling, holding that substantial evidence supports the Board’s finding that the PCT application provides sufficient written description for the claim terms “light guide,” “first channel,” and “permanently affixed.” The Federal Circuit credited the Board’s determination that the field of the invention is a predictable art and that a lower level of detail is required to meet the written description requirement. Regarding “light guide,” the Federal Circuit held that the Board properly relied on undisputed expert testimony that “fibre optic bundles” are a type of light guide and that light guides were well known in the art. Regarding written description support for “first channel” and “permanently affixed,” the Federal Circuit determined the Board properly relied on intrinsic evidence, such as the patent figures, as well as prior art patents that reflected the state of the art at the time of the invention.
PTAB Should Consider a Court’s Prior Claim Construction of the Same Term in the Same Patent
In In Re: Power Integrations, Inc., Appeal No. 2017-1304, the Federal Circuit held that the Board’s broad construction of the term “coupled” was inconsistent with the specification and rendered the term meaningless.
Fairchild Semiconductor sought reexamination of a Power Integrations patent that Power Integrated had asserted in litigation. The patent relates to “a technique for reducing electromagnetic interference (‘EMI’) noise.” In the earlier district court litigation, a jury found the patent valid over the prior art, and the Federal Circuit affirmed that earlier decision. In the initial reexamination, the Board affirmed the Examiner’s rejection of the claims as anticipated by several prior art references. To reach this conclusion, the Board construed the term “coupled” by adopting the definition of the term from a generalist dictionary. The Federal Circuit vacated the Board’s decision for failing to thoroughly assess the scope of claim 1 in light of the specification and surrounding claim language. The Federal Circuit instructed the Board to evaluate the district court’s construction of the claim term “coupled” and determine if the district court’s construction was consistent with the broadest reasonable construction of the term. On remand, the Board, in a second reexamination, again broadly construed the term “coupled” using a generalist dictionary. Power Integrations appealed the Board’s second reexamination decision.
The Federal Circuit reversed the Board’s decision because the Board’s construction was “unreasonably broad and improperly omitted any consideration of the disclosure in the specification.” The Federal Circuit held that the patent’s specification set forth a specific relationship between the “coupled” components, and the Board’s construction ignored that relationship. In doing so, the Board rendered the term “coupled” meaningless, as the limitation could be satisfied so long as the two components were in the system, which was contrary to the teachings of the patent. The Board’s construction was also inconsistent with claim language that required one of the coupled elements to directly act on the other coupled element.
The Federal Circuit concluded “[t]he board has had two opportunities to come up with a sustainable interpretation that differs from the one that survived litigation and has failed. We conclude there is not one.” The Federal Circuit reversed the Board’s rejections.
Federal Circuit Affirms That the PTAB Does Not Need to Consider Untimely Arguments Raised During Oral Argument
In Dell, Inc. v. Acceleron, LLC, Appeal No. 2017-1101, the Federal Circuit held the Board was not required to consider new evidence presented during oral argument.
The Board instituted inter partes review of Acceleron’s patent based on Dell’s petition. At oral argument, Dell raised an entirely new argument regarding the disclosure of the prior art. Acceleron objected that Dell’s argument was not timely, but the Board denied Acceleron’s objection. Further, the Board relied exclusively on Dell’s new argument to find one of the claims anticipated. In a first appeal, the Federal Circuit remanded, stating that “[t]he agency . . . must provide all interested parties opportunity for the submission and consideration of facts and arguments . . . and must allow a party to submit rebuttal evidence as may be required for a full and true disclosure of the facts.” On remand, the Board decided not to consider Dell’s new argument and found the claim at issue valid. Dell appealed the Board’s decision.
The Federal Circuit affirmed. The Federal Circuit explained that its remand order “does not mean . . . that we ordered the Board to consider Dell’s new argument and Acceleron’s response.” The court distinguished the present case from its prior SAS decision, where the Board adopted a “new, and ultimately correct” claim interpretation in its final written decision after “chang[ing] theories in midstream” with no notice. In SAS, the Federal Circuit directed the Board to allow the parties to present evidence and argument. The court also observed that PTO guidelines prohibit parties from presenting new evidence or arguments at the oral argument before the Board. Thus, the Board was obligated to dismiss Dell’s untimely argument.
The PTAB Cannot Invoke “Ordinary Creativity” of a Skilled Artisan to Supply a Missing Claim Limitation Without Reasoned Analysis and Evidence
In DSS Technology Management, Inc. v. Apple Inc., Appeal Nos. 2016-2523, 2016-2524, the Federal Circuit held that when resolving an obviousness challenge, the PTAB cannot invoke the “ordinary creativity” of a skilled artisan to supply a missing claim limitation without reasoned analysis and evidence.
In an IPR proceeding initiated by Apple, the PTAB found all challenged claims were obvious. A single limitation was at issue, and was not found in the prior art. Nevertheless, the PTAB found “no persuasive evidence of record that it would have been uniquely challenging or difficult for one of ordinary skill in the art to do so.” DSS appealed to the Federal Circuit.
On appeal, the Federal Circuit determined that the PTAB’s final written decision did not sufficiently support the obviousness finding. The Federal Circuit found that “ordinary creativity” or “common sense,” should only be invoked to fill in a missing claim limitation when that limitation is “unusually simple” and the technology is “particularly straightforward.” Here, where the claims were directed to a wireless communication network, the Federal Circuit found that this was not the case. The Federal Circuit went further and determined that the record evidence did not supply the Board with a basis for a more reasoned explanation to support obviousness. For this reason, the Federal Circuit reversed, rather than remanding to the Board for additional investigation or explanation.
Judge Newman dissented, suggesting that even if the PTAB’s explanation were inadequate, the appropriate appellate action would be to remand. She noted that a reversal, which leads to a final judgment of patentability, is “contrary to the body of precedent, and dilutes the purpose of these post-grant proceedings.”