37 for 42: Previously-Considered Art Lives Again in Grant of Inter Partes Review Trial

iStock_000014464933XSmallThe Board has again failed to toss aside argument and art previously considered by the Patent Office (this time in an ex parte reexamination) and, instead, instituted an inter partes review trial on all six challenged claims in a case styled Nexans, Inc. v. Belden Technologies, Inc. (IPR2013-00057), involving US Pat. No. 6,074,503. Four of 9 proposed grounds for challenge were granted in the Board’s decision.

The invention of the ‘503 patent involves a method of producing a cable. The method includes a step of passing a plurality of transmission media such as wires and a core through a first die which aligns the plurality of transmission media with surface features of the core and prevents twisting motion of the core. The method includes another step of bunching the aligned plurality of transmission media and core using a second die which forces each of the plurality of transmission media into contact with the surface features of the core. The bunched plurality of transmission media and core are twisted close to the cable, and the closed cable is jacketed.

Patent Owner first argued that because three of the references contained in the petition were already considered by the examiner in a prior ex parte reexamination which resulted in confirmation of the claims, the Board should deny those portions of the petition. The Board cited 35 U.S.C. § 325(d) and stated the statute gives the Director the authority not to institute review on the basis that the same or substantially the same prior art or arguments were presented previously to the USPTO, but does not require so. Because the Patent Challenger’s alleged unpatentability grounds have some merit, the Board declined to deny the petition under 35 U.S.C. § 325(d). Order at 8. This continues a trend of the Board’s willingness to consider references even if they were previously considered during original prosecution or a reexamination.

The Board then turned to its claim construction analysis and interpreted the terms “core” and “prevents twisting motion of the core.” Basing its definition of “core” strictly on the specification of the ‘503 patent, the Board found that the term “core” does not have to have a bulky or extensive cross-section and there is no reason to exclude structure in the form of thin tape from forming or constituting the core. The Board also determined that “prevents twisting motion of the core” was met by the prevention of twisting in the area where the core passes through the first die once the desired position of the core for alignment during production is established. Thus, twisting of the core need not be prevented (1) at all places along the axial length of the core, or (2) before the desired alignment of the core has been determined and put in place and cable production has commenced.

The Board then considered several grounds asserting anticipation of the challenged claims.  To that end, Patent Challenger argued that a prior art reference disclosed a branching board of a first die which inherently prevented twisting of the core. The Board rejected the argument, stating that because the disclosure does not show an axial view of the branding board in the direction of cable feed, it could not be known what manner the core passes through the branching board. To establish inherent disclosure, the limitation at issue necessarily must be present in the corresponding element described in the prior art reference. Inherency may not be established by probabilities or possibilities. The mere fact that a certain thing may result from a given set of circumstances is not sufficient to establish inherency. Order at 26. The Board found that even if the branching board, in some circumstances, prevented twisting of the core, the possibility is inadequate to establish inherent disclosure of twist prevention.

In the obviousness challenge grounds analysis, the Board determined that inserting an additional die upstream of a wire-splitting board of the assembly of a prior art reference involved merely a predictable use of a prior art element disclosed in other references.  Further, Board held that such a combination need not be predicated on any specific teachings; that is, the Board “need not seek out precise teachings directed to the specific subject matter of the challenged claim, for a court can take account of the inferences and creative steps that a person of ordinary skill in the art would employ.” Order at 33.

Patent Owner sought exclusion of one of the Patent Challenger’s exhibits on the ground that it constituted inadmissible hearsay. The exhibit is a collection of selected trial transcripts from related litigation, including the testimony of an expert witness. The Board stated that exclusion of evidence at this stage of the proceeding is premature. Order at 41. In any event, the exhibit appeared to have been relied on by the Patent Challenger only in connection with arguments regarding a reference that was not applied as a basis for any granted challenge grounds.

In the end, the Board instituted trial on all challenged claims including, notably, some challenge grounds that used a reference that was previously considered during an ex parte reexamination.

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.

31 for 32: Secondary Considerations Argument Comes Up Short in Decision to Institute Inter Partes Review Trial

iStock_000000967953XSmallCBS was successful in forcing all 41 challenged claims of a Helferich patent into an inter partes review trial. The case is styled CBS Interactive Inc., The New York Times Company, G4 Media, Bravo Media LLC, and Phoenix Newpaper, Inc. v. Helferich Patent Licensing, LLC (IPR2013-00033), involving US Pat. No. 7,155,241. Each claim was challenged based on a single ground, but that was all that was required to institute the trial.

The ‘241 patent discloses a paging system that notifies the user of a paging transceiver that a message has been received, but without sending the entire message. The paging system allows the user to determine the priority of the message and whether the user wants to retrieve, play, erase, store, forward, or reply to the message at a convenient time, such as downloading the entire message at less expensive off-peak hours.

The Board started its analysis with a claim construction analysis that primarily involved means plus function claim limitations.  To that end, the Board undertook a fairly detailed analysis of the specification in identifying corresponding structure for the several means-plus-function limitations. In some instances, the Board noted that Patent Owner’s claim construction was insufficient because, although Patent Owner contested Patent Challenger’s constructions, Patent Owner did not identify any specific portions of the specification that described any corresponding structure. Order at 18.

The Board then proceeded to an obviousness analysis, finding that the prior art met the “reasonable likelihood” standard required to institute an inter partes review trial.  In so doing, the Board rejected Patent Owner’s argument for secondary considerations of nonobviousness. Patent Owner had argued that the enormous licensing success of “Helferich patents” was sufficient to overcome an obviousness determination, but the Board found that such an argument, detached from the patent-in-suit, was unpersuasive.  Order at 22. Further, the Board found that Patent Owner failed to provide the required nexus between the merits of the invention and the licenses themselves.  Id.  As such, the secondary considerations arguments put forth by Patent Owner were rejected by the Board.

The Patent Owner also argued that the Board should deny the petition because the Patent Challenger used the same arguments as during a previous reexamination argument. The Board was not persuaded by the argument because the ‘241 patent was not involved in the previous reexamination, and even if it was, section 325(d) does not require the Director to defer to a prior determination in the Office, even one which considered the same prior art and arguments. Order at 24.

In the end, the Board granted trial for all challenged claims, granting on the single challenge ground for approximately half the claims, and another single challenge ground for the remainder of the claims.

30 for 31: Prior Art from Original Prosecution Used as a Basis for Institution of Inter Partes Review

iStock_000000202778XSmallThe Patent Trial and Appeal Board continued to give little or no deference to previous decisions by the Patent Office in granting an inter partes review trial in response to a petition filed by Chimei Innolux in a case styled as Chimei Innolux Corp. v. Semiconductor Energy Lab. Co., Ltd. (IPR2013-00038), involving US Pat. No. 7,956,978. Both challenged claims were put into trial based on multiple obviousness grounds.

The ‘978 patent describes LCD devices having two opposing substrates bonded together with a sealing material. The ‘978 patent solves a problem in the prior art by using dummy wiring sections which are nearly equal in height to the other conductive lines to render the seal and consequent gap more uniform.

The Board first addressed two statutory threshold issues. The Patent Owner argued that the petition for inter partes review was improper under section 325(d) because the PTO Examiner previously considered the same prior art references during prosecution of the application leading to the ‘978 patent. The Board rejected this argument because there was no showing of substantially the same arguments, beyond simply using the same prior art references. Order at 6. The Board noted new evidence not considered during the prior examination, including the Patent Challenger’s expert declaration. In general, therefore, a Patent Challenger’s expert declaration, alone, seems like enough to allow prior art previously considered during examination to be used as a basis for inter partes review.

The Board next addressed the Patent Owner’s contentions that the petition should be denied due to a failure to identify all real parties-in-interest, because not all co-defendants in pending litigation were listed. Despite the fact that all co-defendants represented to the district court that they all “participated in filing the instant Petition” and agreed to be bound by this inter partes review, the Board found that insufficient evidence was set forth by Patent Owner to prove that the co-defendants not listed as real parties-in-interest had control over the IPR proceeding. Order at 7.

The Board then proceed through a fairly straight-forward obviousness analysis, failing to find Patent Owner’s objections to the grounds asserted in the petition to be persuasive.  As such, the Board granted an IPR trial on two different obviousness grounds using references cited in the original examination of the application leading to the ‘978 patent, as additionally supported by Patent Challenger’s expert declaration. Maintaining a developing trend in IPR practice, the Board is providing almost no deference to the Patent Office’s previous decisions relating to the patent-in-suit, leaving open the potential for Patent Challengers to re-use prior art references from the original examination.

25 for 26: Inter Partes Review Trial Instituted On All Grounds In Case Involving Prior Denial of Ex Parte Reexamination Request

Research in Motion was again successful in getting all claims of a Multimedia Ideas patent into an inter partes review trial for all challenged grounds, even relying on some prior art and arguments that were unsuccessful in a denial of a prior ex parte reexamination request. The case is styled Research and Motion Corp. and Research and Motion Ltd. v. Multimedia Ideas LLC (IPR2013-00036), involving US Patent No. 6,871,048. The Board granted the IPR trial for all 12 claims based on all 24 obviousness grounds for challenge. There were no challenge grounds based on anticipation.

The invention of the ‘048 patent relates to a mobile communication apparatus (e.g., a cell phone) for carrying out communication through radio waves and an information providing system using the mobile communication apparatus. Users of wireless mobile communication devices often carry, in addition, a portable sound device for playing music or a portable radio receiver for receiving AM/FM broadcasting, etc. It is an object of the invention to combine the functions of these devices so that the user can obtain information of desired content at a desired time without additionally carrying other devices. The dispute between the parties is focused on the meaning of the “stand-by” state, because the claims require reproducing and outputting downloaded data when the apparatus is in a “stand-by” state.

In general, the Board’s decision included several interesting topics, including: 1) consideration of what, if any, effect a prior reexamination decision, involving the same prior art, had on the IPR, 2) whether the pages used in an expert declaration count against the page limit for a petition, and 3) the Board adopted a key claim construction that was even broader than the construction urged by Patent Challenger.

At the outset, the Patent Owner stressed that the Board should carefully consider the prior denial of an ex parte reexamination request for the patent at issue. The Patent Owner further noted that the previous reexamination request was denied after explicitly considering two references with respect to the stand-by state limitation in which the Patent Challenger is relying on in the present IPR. Although the Board stated that consideration by examiners of the same claim feature based on the same prior art certainly should be considered, the patent owner should not expect that the Board necessarily would come to the same conclusion.

[pullquote align=”left|center|right” textalign=”left|center|right” width=”30%”]35 U.S.C. § 325(d) – “In determining whether to institute or order a proceeding under … chapter 31, the Director may take into account whether, and reject the petition or request because, the same or substantially the same prior art or arguments previously were presented to the Office.”[/pullquote]

The Board then made it very clear that the PTAB will not give any deference to previous reexamination decisions, even when considering the same prior art and arguments.  The Board went on to further state that the Patent Owner’s argument that the Patent Challenger failed to explain why the previous denial was incorrect or why it should be reconsidered, was misdirected. “A petition for inter partes review is not a renewed request for patent reexamination, an appeal of a prior decision denying a request for reexamination, or a rehearing request of the prior decision denying a request for reexamination. The petitioner correctly did not present its petition in any one of those ways.”

This view of prior proceedings is, of course, great news for Patent Challengers.  The Board is more than willing to give a fresh look to old arguments.  While this may be seen by Patent Owners as undermining their property rights and adding uncertainty to earlier decisions by the Office, this is simply another reason why inter partes review proceedings have been, and will continue to be, popular with Patent Challengers.

Further, although this case involves argument about a previous denial of an earlier ex parte reexamination request, the Board’s reasoning extends to all prior decisions by the Patent Office, indicating that the Board is more than willing to reconsider prior art references cited in the patent. To that end, it is interesting to note that approximately 2/3 of IPR petitions filed to date have included at least some previously cited prior art references.

Patent Owner also took the position that Patent Challenger’s petition violated the page length limit, arguing that the twenty-nine (29) page expert declaration that was an exhibit to the petition should have added to the forty (40) page petition given that the declaration contains numerous arguments in addition to factual support. The Board declined to accept Patent Owner’s argument on four grounds:  1) Patent Owner did not identify argument portions of the declaration, 2) arguments not included in the petition may not be considered, 3) page limit objections should be raised as soon as possible, and 4) there is no requirement that a supporting declaration only cite to evidence which has already been directly cited in the petition. Order at 8-9. The Board specifically criticized Patent Owner for taking three months to make a procedural page limit objection.

Finally turning to the merits of the case, the Board construed “stand-by” state to mean a state in which the mobile communication device is powered on and ready to transmit or receive data, but is not actively communicating. This was essentially the interpretation urged by Patent Challenger, but Patent Challenger limited the mobile communication device to a cellphone. Interestingly, the Board stated that even Patent Challenger’s construction was too narrow, and “mobile communication apparatus” should apply to other devices beyond cellphones. The Board also noted that  Patent Owner did not take a position on the construction of the term, as well as mentioning that they were aware of the interpretation used during the previous reexamination denial, but did not address those issues any further. Order at 11-12.

In the end, the Board granted all grounds for all claims. Patent Owner beware – even after the Patent Office has had two or more shots at evaluating the validity of your patent, the Board will provide no deference to those earlier determinations.

Patent Owner Finally Wins! First Inter Partes Review Trial Denied

After running off a string of ten straight victories, a patent challenger faced its first setback in an inter partes review proceeding, as the Board declined to institute an IPR review against any of the 18 challenged claims in Synopsys, Inc. v. Mentor Graphics Corp. (IPR2012-00041), involving US Patent No. 6,947,882.  The Board considered all of the proposed grounds by Patent Challenger, but found that the “reasonable likelihood” standard had not been met (stay tuned…a second IPR petition, involving the same parties, resulted in the institution of a trial on a second patent).

The subject matter of the ‘882 patent is a system for emulating integrated circuit designs.  The key limitation upon which the Board focused was whether the claimed “independent” clock signal encompassed “asynchronous” clock signals.

The Board first noted that the Patent Challenger did not explicitly make the argument that independent encompasses asynchronous, but deduced that this was the thrust of Patent Challenger’s argument, based upon the claim charts and supporting argument from the petition.  The Board, however, agreed with Patent Owner that the term “asynchronous” was not synonymous with “independent.”  Order at 6.  In so finding, the Board relied upon the dictionary definition of “independent,” and found that nothing in the patent specification suggested that the term should be interpreted differently.

[pullquote align=”left|center|right” textalign=”left|center|right” width=”30%”]35 USC §315(d) – In determining whether to institute or order a proceeding…the Director may take into account whether, and reject the petition or request because, the same or substantially the same prior art or arguments were presented to the Office.[/pullquote]

After completing its claim construction analysis, the Board turned to a comparison of the challenged claims to the proposed art.  At threshold, the Board addressed Patent Owner’s argument that the art contained in the petition was already considered by the Office – an argument that has already proven to be popular among Patent Owner Preliminary Responses.  The Board found, however, that the petition’s arguments were not previously considered because the reference at issue was applied in a different way during prosecution vis-à-vis what was proposed in the petition.  Thus, the Board declined to ignore the proposed grounds solely on the basis that the art was previously before the Office.

But the Board ended up at the same conclusion anyway, finding that none of the proposed grounds met the reasonable likelihood standard.  At the outset, the Board considered the argument by Patent Challenger that sought to incorporate by reference the disclosure of a different prior art reference.  Because the ‘882 patent “unambiguously incorporated the entire…specification,” the Board found that the document became part of the host ‘882 patent, as if it were explicitly contained therein.  Citing Telemac Cellular Corp. v. Topp Telecom, Inc., 247 F.3d 1316, 1329 (Fed. Cir. 2001).  Despite that fact, the Board went on to find that the prior art did not anticipate because the reference failed to disclose the Board-construed “independent” limitation.  The Board had similar findings with regard to the other two references cited in anticipation arguments.

The Board also denied the grounds set forth in the petition relating to obviousness based primarily on the fact that Patent Challenger did not adequately explain its obviousness position.  Citing 35 USC §312(a)(3) and 37 CFR 32.104(b)(4), the Board found that Patent Challenger’s petition failed to identify with particularity each challenged claim, the grounds on which the challenge is based, and the evidence that supports that ground.  In short, Patent Challenger’s conclusory statements failed to meet the above-referenced standards to properly exceed the “reasonable likelihood” standard.

The Board’s decision not to initiate a trial in this inter partes review contained significant discussion that spoke more to the deficiencies of the petition, than to the strength of the challenged patent.  In any event, Patent Owners can be heartened by the fact that the Board is not merely rubber stamping each petition.  While the Board’s in depth analysis in its Orders initiating IPR trials made it clear that it was not working with a rubber stamp, the results spoke for themselves up to this point.