32 for 33: PTAB Again Allows Re-Argument of Grounds Denied in Earlier Reexamination

iStock_000019792592XSmallThe PTAB continued its trend of not providing any deference in an inter partes review to previous actions by the Patent Office with respect to a previously-challenged patent in a case styled Vestcom Int’l, Inc. v. Grandville Printing Co. (IPR2013-00031), involving US Pat. No. 8,020,765. Three of the fourteen challenge grounds were granted, with the Board finding the other 11 grounds to be redundant.

The invention of the ‘765 patent relates to a method of printing, distributing, and placing price tags and point-of-purchase signs for use in retail store shelves and displays. According to the ‘765 patent, the invention is particularly useful for “just-in-time” printing, delivery of price tags with minimal lead times, and faster price tag changes at stores – all while reducing labor costs.

As has become its pattern, the Board first construed two key claim limitations.  First, the Board adopted Patent Challenger’s definition for “digital press,” after noting that Patent Owner did not contest the construction.  Second, the Board, sua sponte, construed the term “just-in-time,” finding that its meaning “is not apparent to us.”  Order at 13.  In construing that term, the Board first noted that the ‘765 patent did not contain an explicit or special definition of “just-in-time.”  As such, the Board turned to a dictionary definition, citing to an online resource (xreferplus.com).  Order at 15.

After construing the two claim terms, the Board proceeded to analyze the Patent Owner’s estoppel argument, that Patent Challenger previously filed a request for inter partes reexamination of the ‘765 patent that included 405 proposed grounds of rejection (fourteen of which were identical to those contained in the present petition for inter partes review). In the prior reexamination, the PTO issued a Reexamination Order denying the petition for inter partes reexamination.  Based on this denial, Patent Owner sought a finding that the present petition for inter partes review should be denied.  The Board disagreed.

First, the Board determined that the previously-codified estoppel provisions of inter partes reexamination (35 USC §317(b)) did not apply to inter partes review. Order at 17. Next, the Board determined that the current version of 35 USC §318(a) did not apply because that section only related to final, written decisions based on a petition for inter partes review, not inter partes reexamination. Order at 17-18. Finally, the Board determined that issue preclusion did not apply because the prior Reexamination Order only addressed a different claim not challenged in the present inter partes review and did not include any substantive analysis or draw any conclusions relative to the claims challenged in the present inter partes review, even though those claims were included in the prior request for inter partes reexamination.  That is, because the specific denial of the reexamination petition only applied the art to claim 1, not the claims challenged here, issue preclusion was inappropriate. Order at 18-19. Therefore, the Board held that Patent Challengers were not estopped from presenting identical grounds for unpatentability.

In the end, the Board granted trial on all thee challenged claims based on three obviousness challenge grounds each involving a combination of at least three prior art references. Important to that analysis was the Board’s rejection of Patent Owner’s argument that there was insufficient rationale to combine the references cited by Patent Challenger. In rejecting this argument, the Board noted that Patent Owner did not provide “credible evidence or arguments concerning any technological difficulties” that would prevent the combination.  Order at 24.  Of course, Patent Owner was unable to put forth expert testimony at this stage of the proceeding.

Lastly, the Board denied an argument that secondary considerations militated against a finding of a reasonable likelihood that one or more claims was unpatentable.  Order at 25.  To that end, the Board found that there was no showing of a nexus between the claimed commercial success and the claimed invention.  To establish commercial success, Patent Owner had to show that the success was “directly attributable” to the claimed features.  Further, Patent Owner needed to address whether other factors, including advertising and promotion, contributed to the commercial success.