Uniloc USA v. Sega of America: Evaluating the Priority Date of a Means + Function Claim

Uniloc USA owns US 5,490,216 (‘216), with claims directed to “[a] registration system for licensing execution of digital data in a use mode….” Sega petitioned for IPR of the ‘216 patent, arguing that Claims 1–20 are anticipated by US 5,509,070 (“Schull”), which was filed on 15 December 1992. The ‘216 patent was filed on 21 September 1993, but claims priority to AU PL5524, filed on 26 October 1992. In other words, Schull is only prior art if ‘216 does not get the benefit of the Australian filing date. The PTAB concluded that the Australian application did not provide adequate written description support for the U.S. claims, and held that Schull anticipates ‘216 Claims 1–20.

At issue was the limitation “generating means” in the U.S. claims. In a previous lawsuit between Uniloc and Microsoft, the Federal Circuit had construed “generating means” to mean “to generate a local or remote licensee unique ID/registration key,” and agreed with the district court that the corresponding structure was “a summation algorithm or a summer.” The PTAB concluded that no such summation algorithm was present in the Australian application, and therefore the U.S. claims could not take the benefit of the Australian filing date.

Uniloc argued that this was legal error. While a failure to describe adequate structure in the specification to support a §112(6) claim limitation can give rise to an indefiniteness failure under §112(2), the priority analysis has historically focused on whether the priority filing contains adequate written description to satisfy §112(1). X2Y Attenuators, LLC v. Int’l Trade Comm’n, 757 F.3d 1358, 1365 (Fed. Cir. 2014). Uniloc argued that questions of §112(2) and §112(6) are not germane to the priority analysis, and therefore the PTAB had made an error of law in addressing these considerations when deciding priority for the ‘216 patent. The Federal Circuit Court of Appeals (CAFC) disagreed with Uniloc and affirmed the PTAB.

Although this decision is not precedential, the reasoning here could have important implications in many IPRs and PGRs in the future. The extent of the prior art is determined in view of a patent’s priority date. If a patent is not entitled to the benefit of its priority filing, the world of prior art is correspondingly larger. Moreover, the CAFC has recently made it easier for a claim limitation to be regarded as a means-plus-function (§112(6)) limitation. Williamson v. Citrix Online, LLC, 792 F.3d 1339, 1349 (Fed. Cir. 2015) (en banc). Therefore, a would-be challenger in IPR should pay careful attention to any limitations in the challenged patent that could be regarded as means-plus-function, and then scrutinize the priority filings to see whether the priority filings have adequate structure (and teachings listing the structure to the claimed function) to support the means-plus-function limitations in the patents to be challenged. If the supporting structure is not clearly present in the priority filing, then the challenged patent can be attacked on a wider basis of prior art.

“Catch-All” Phrases Insufficient To Give Proper Notice of Grounds for Petition

In Emerachem Holdings, LLC v. Volkswagen Group of America, Inc., the Federal Circuit made clear that “catch-all” phrases in a Petition for IPR and/or a Board’s Institution Decision are insufficient to put a patent owner on notice of the specific grounds alleged for unpatentability.

In this case, the Board relied upon the “Stiles” reference as disclosing one of the elements of challenged claims 3, 16 and 20, even though the Petition did not specifically rely upon Stiles for those claims (instead applying Stiles to other challenged claims).  Similarly, the Board’s Institution Decision did not specifically identify Stiles as part of the ground for unpatentability of claims 3, 16 and 20.  Petitioner argued that a broad statement in the Petition that “[c]laims 1-14 and 16-20 are obvious under 35 U.S.C. §103(a) over the combination of Campbell [‘558] and either Hirota or Saito, in view of Stiles” was sufficient to put the Patent Owner on notice.  The Petitioner also argued – as did the PTO, which intervened to defend the Board’s decision – that a similar statement in the Institution Decision was sufficient notice.  The Federal Circuit rejected those arguments, finding that such general statements, particularly in the light of very detailed claim charts that failed to identify Stiles for claims 3, 16 and 20, do not provide sufficient notice.  Therefore, the Patent Owner’s right to notice and an opportunity to respond under the America Invents Act were violated.  The Federal Circuit reversed and remanded.

The Federal Circuit also reaffirmed the need for corroboration when relying upon the testimony of an alleged inventor.  Here, the inventors of the challenged patent each submitted declarations to the effect that they were the sole inventors of the subject matter of an asserted prior art reference on which they were listed inventors along with two other inventors.  Therefore, argued the Patent Owner, the alleged prior art did not qualify under 35 U.S.C. §102(e) because it was not “by another.”  The inventors’ declarations, though, were uncorroborated by any other testimony or documents.  The Federal Circuit reaffirmed that, in many cases, the testimony of an inventor must be corroborated, and that the sufficiency of the corroboration will be determined under the totality of the circumstances.

Sec. 103(c) Saves Patent Claims in IPR Final Written Decision

14483088_sIn a recently-issued Final Written Decision, the Board thoroughly explained the sometimes tricky issue of the shift, if any, of the burden of proof/production in an IPR proceeding. Global Tel*Link Corp. v. Securus Techs., Inc., IPR2014-00825, Paper 36. The burden issue arose in the interesting context of a patent owner disqualifying certain prior art using 35 USC § 103(c)(1).

The IPR trial in Global Tel*Link was instituted based upon a prior art reference that was co-assigned to the assignee of the patent-at-issue in the IPR (“the ‘357 patent”). Patent Owner argued, therefore, that the prior art was disqualified under § 103(c)(1) because the art and claimed invention was “subject to an obligation of assignment to the same person.”

The Board first addressed the issue of burden of persuasion versus burden of production. In an IPR proceeding, the burden of persuasion is on Petitioner “and that burden never shifts to the Patent Owner.” Op. at 11. 35 USC § 316(e). Regarding the issue of the prior art at issue in the proceeding, Petitioner initially also had the burden of production. In this case, that burden was satisfied by the argument in the Petition that the prior art (under 102(e)) rendered the challenged claims unpatentable.

At this point, the burden of production then shifted to Patent Owner to argue that the art did not qualify as prior art. The Board determined that Patent Owner met this burden by showing that both the prior art and ‘357 patent were owned by the same company at the time the invention was made. The evidence supporting this proposition included assignment records of the ‘357 patent. Patent owner met its burden of production that, at the time of the filing of the application that led to the ‘357 patent, the inventions were co-owned by making a representation that the invention at issue was not constructively reduced to practice until the filing of that application. On this point, the Board concluded that, “absent credible factual support to the contrary, the claimed invention was made on the effective filing date.” Op. at 13-14.

The shifting of the burden of production did not hamper Patent Owner in this case, as a § 103(c)(1) argument to disqualify certain prior art led to the survival of several challenged claims.

PTAB Finds Copyright Notice is Inadmissible Hearsay – Denies Petition for IPR

6686163_sDifferent panels of the Patent Trial and Appeal Board have, for the most part, agreed with each other on many of the key issues that arise in inter partes review proceedings. There are, however, instances of disagreement and an example of this type of disagreement arose in ServiceNow, Inc. v. Hewlett-Packard, Inc., IPR2015-00707, wherein this particular panel of PTAB judges decided that a copyright notice on a prior art reference did not suffice to establish that the reference was publicly available as of the date of the notice.

The prior art at issue included the date “July 2001” on their face and also included a copyright date of “2001.” The Board agreed with Patent Owner that the indications of the availability of the references is inadmissible hearsay to the extent Petitioner relies on the date for the truth of that information. Order at 16. Notable in the Board’s analysis was the fact that the references included a statement that restricted the use and dissemination of the references.

The Board noted that at least one other panel agreed that a copyright notice as evidence that a reference was a printed publication as of a particular date is inadmissible hearsay. Standard Innovation Corp. v. Lelo, Inc., IPR201400148, Paper 41, at 13-16. The Board also noted, however, that other panels have determined that a copyright notice is prima facie evidence of publication. Ford Motor Co. v. Cruise Control Techs. LLC, IPR2014-00291, Paper 44, at 7-8; FLIR Sys., Inc. v. Leak Surveys, Inc., IPR2014-00411, Paper 9, at 18-19.

Ultimately, on the basis of the facts mentioned above, the Board decided that Petitioner had failed to establish that the exhibits at issue were publicly available more than one year prior to the priority date of the patent-at-issue. Order at 17.

 

Board Disqualifies Reference As Not Meeting Requirements of 102(e)

iStock_000011114669SmallWe are reminded once again, by the Board’s decision denying review in Cisco Systems, Inc. v. Constellation Techs., LLC, IPR2014-00914, that 102(b) art is better than 102(e) art.  In Cisco, Petitioner relied on a reference (Riley) it asserted to be 102(e) prior art.  In making that argument, Petitioner had the burden of convincing the Board that the Riley reference was support by the two provisional applications to which it claimed priority.  Petitioner tried to meet that burden through expert declaration testimony.

The Board was not persuaded by the proffered testimony, which the Board found to be conclusory and thus entitled to little, if any, weight.  Decision at 23.  As a result, the earliest available priority date of the reference was after the priority date of the challenged patent.  Thus, the Board denied review as to the grounds which included the Riley reference.

The lesson here, as is the case with many aspects of IPR practice, is that if you need to prove a point, be sure to include specific, detailed analysis.

Doctrine of Inurement Does Not Save Design Patent in IPR Proceeding

6686163_sThere are precious few opportunities to be able to write about the Doctrine of Inurement in inter partes review proceedings (or otherwise, for that matter). So, we take the opportunity here to consider the doctrine, in a design patent context, with the Board’s decision in Sensio, Inc. v. Select Brands, Inc., IPR2013-00580. In Sensio, the Board rejected Patent Owner’s attempt to antedate 102(a) prior art under the Doctrine of Inurement, finding that insufficient evidence supported a finding that the work of a third party inured to the benefit of Patent Owner.

More specifically, Patent Owner argued that it had communicated the design of the subject matter later claimed in the subject patent (design for a multiple-crock buffet server) to a third party for manufacture of a prototype. The first prototype was then manufactured and sent to Patent Owner by the third party months prior to the date of the prior art references relied upon in this challenge. There were no design changes in taking the prototype to the present day commercial model. Decision at 6-7. Patent Owner, assuming conception was established by photographs of the prototype and business records, argued that reduction to practice was achieved prior to the date of the prior art, as evidenced by several commercial product description documents which antedate the prior art by a few months. Id. at 7-8.

Petitioner responded by rebutting Patent Owner’s argument the doctrine of inurement applied (that acts by others working explicitly or implicitly at the inventor’s request will inure to the inventor’s benefit). The first requirement of inurement is that the inventor must have conceived of the invention prior to involving the third party. Petitioner argued: (1) because a third party (rather than the inventors) built the prototypes, there was no reduction to practice; (2) Patent Owner did not show that the third party building the prototypes inures to Patent Owner’s benefit; and (3) the photographs of the prototype produced by the third party were insufficiently clear to establish conception of the design by the inventors prior to involvement of the third party. Id. at 8-9.

After rejecting Patent Owner’s argument that the foundational case law of the doctrine of inurement does not apply to design patents (only to utility patents), the Board narrowed the key issue to whether the third-party-built prototypes inure to Patent Owner’s benefit.  Id. at 10.  The Board began by rejecting Patent Owner’s assumption that conception had taken place, and stated that Patent Owner had not, in fact, shown that conception of the claim design happened before the prior art date. The Board based this finding on a lack of corroboration of the inventor’s testimony regarding conception.  Id.at 12-13.  Patent Owner’s submission of various business records and product descriptions were inadequate, as they did not address the claimed ornamental design and focused more on the commercial product and its technical specifications.  Further, the Board weighed the fact there was no evidence of record which showed correspondence between Patent Owner and third party prior to production of the design prototype.  Id.  at 14.

Accordingly, the Board found that Patent Owner had not adequately shown that it invented the claimed design prior to the prior art date, and allowed the references at issue as prior art under 102(a).  Id. at 14.

“Indirect” Common Inventorship Not Sufficient To Support Priority Claim Under 35 U.S.C. §120

PriorityThe PTAB recently took up the issue of whether, in a family of patents and applications, a later patent in the family is entitled to the benefit of the filing date of an earlier-filed application in the family where the later patent and the earlier application do not themselves share a common inventor, but each application in the chain share a common inventor with at least the immediately preceding application.  Without Federal Circuit precedent directly on point, the PTAB construed the statutory language of 35 U.S.C. §120 to require at least one common inventor between the later patent and the earlier-filed application to which priority is being claimed. Common inventorship between immediately-preceding applications in the chain alone is not sufficient.

In Polaris Wireless, Inc. v. True Position, Inc., IPR2013-00323, the Patent Owner attempted to disqualify an asserted prior art reference by claiming priority to the filing date of an application filed before the publication date of the prior art reference.  The priority application was linked to the patent challenged in the IPR through a series of intermediary continuation applications.  While each of the applications and patents in the family shared a common inventor with at least the application that immediately preceded it, the challenged patent did not share a common inventor with the priority application itself.

Without Federal Circuit precedent directly on point, the PTAB turned directly to the language of  35 U.S.C. §120, and particularly the provision that “…a patent is entitled to the priority date of an earlier filed application if…the applications have at least one common inventor.”  The PTAB concluded that the “earlier filed application” properly refers to the prior filed application with the accordable filing date.  The PTAB further concluded that its interpretation of the statute is “consistent with” (though not directly addressed by) Federal Circuit precedent on 35 U.S.C. §120.

Therefore, under Polaris Wireless, Inc. v. True Position, Inc., a patent is entitled to the priority date of an earlier-filed application only if the patent and the earlier-filed application themselves share a common inventor.

IPR Incorporation by Reference Argument Not Enough to Save Priority Claim

26168884_sMany patent challengers have found “incorporation by reference” arguments to be a tempting way to try to convert an obviousness argument into an anticipation argument, but “incorporation by reference” can also impact whether a reference qualifies as prior art, as was the case in IPR2014-00664, IGB Automotive Ltd. and IG Bauerhin GMBH v. Gentherm GMBH.  In that case, the Board instituted review in part because the challenged patent’s earliest claimed priority document did not sufficiently describe the claimed subject matter, rejecting Patent Owner’s argument that the priority document’s “incorporation by reference” sufficiently bolstered the patent’s disclosure.

More specifically, the patent-at-issue claimed priority to two provisional applications having different filing dates. Decision at 14.  Patent Owner argued that a prior art reference (Knoll) relied upon by Petitioner was not prior art because it antedated the earlier of the claimed priority documents. Petitioner countered that the earlier provisional did not contain an enabling disclosure for the subject matter of the claims at issue, making the challenged patent’s earliest priority date filing date of the second (later) provisional application. Id. at 14.  If this later priority date were used, then the Knoll reference would qualify as prior art. The Board agreed with Petitioner, finding that the earlier provisional application did not, on its face, adequately describe at least one of the limitations in the challenged claims.  Decision at 15.

Patent Owner presented a back-up argument, asserting the earlier provisional application does support the priority claim based on that provisional’s “incorporation by reference” of other documents that did adequately describe the claim limitations at issue.  The Board rejected this argument, finding that the facts did not meet the strict incorporation by reference standard, which requires that the alleged priority document “both identifies with ‘detailed particularity’ the specific material in the patents asserted to be incorporated by reference, and ‘clearly indicates’ where that material is found in the incorporated patents.”  Decision at 15 (Board’s emphasis, and citing Xenon Environmental, Inc. v. U.S. Filter Corp., 506 F.3d 1370, 1378–79 (Fed. Cir. 2007).

Accordingly, the Knoll reference did qualify as prior art.

 

PTAB Rules Lab Notebooks Insufficient to Prove Conception and Reduction to Practice

31859106_s (1)Swearing behind a reference is an enticing option for a Patent Owner, but the Board has again reminded parties that rigorous—and admissible—proof of conception and reduction to practice is still necessary.

This issue was addressed in Microsoft Corporation v. Surfcast, Inc., a consolidated opinion concerning four IPR petitions filed by Microsoft challenging one patent in which the Board found all claims unpatentable, and denied another motion to amend.  In its final written decision the Board rejected Patent Owner’s attempt to prove prior conception and reduction to practice despite extensive evidence.

Patent Owner tried to antedate a prior art reference via testimony from inventors regarding conception and reduction to practice.  The Patent Owner also proffered corroborating evidence in the form Exhibits consisting of emails between inventors, lab notebook pages, and other assorted papers.  Decision at 15.

Petitioner challenged the authenticity of the evidence, as all corroborating Exhibits consisted of inventor-generated documents and correspondence between inventors.  Patent Owner responded by providing inventor testimony to authenticate the exhibits. This was insufficient, because it meant the Patent Owner was essentially authenticating documents corroborating inventor testimony with further statements by the inventor.  Accordingly, the Board deemed the authentication defective, as it was not sufficiently independent.  Id. at 16-17.

Patent Owner further argued that corroboration was not necessary when a party attempts to prove conception and reduction to practice through use of physical exhibits.  The Board disagreed, that corroboration of the dates in the exhibits purported to establish conception is still required.  Id. at 17.

Perhaps envisioning an appeal, the Board still proceeded to analyze Patent Owner’s evidence of reasonable diligence towards a reduction to practice.  Patent Owner offered invoices from Patent Owner’s law firm, time entries from an interested party, and declarations of two interested parties who weren’t an inventor.  Here again, though, the Board rejected Patent Owner’s documentary evidence because it was not authenticated by a non-interested person (instead, the authentication declarants each had an interest in the outcome of the case).   Id. at 18-19.

The Board further noted that even if the corroboration was adequate, diligence was not proven on the merits.  The expert testimony purporting to support diligence in reduction to practice was by an expert who worked on later-assigned matters out of chronological order, creating a week of inactivity on the subject application and several gaps in activity.  Id. at 20-21.

Accordingly, the Board found that Patent Owner also failed to prove reasonable diligence to a reduction to practice.  Id. at 20.

PTAB Rejects Two Attempts by Patent Owners to Antedate Prior Art

6686163_sThe fact-based nature of conception/reduction to practice issues makes it worthwhile to consider a number of these types of cases as they arise. Here, we discuss such issues from two Board decisions, K-40 Electronics, LLC v. Escort, Inc., IPR2013-00240 and Handi Quilter, Inc. and Tacony Corporation v. Bernina International AG, IPR2013-00364. In both cases, the Board rejected Patent Owner’s attempt to antedate the prior art-at-issue.

The K-40 Electronics case involves US Pat. No. 6,670,905, relating to a radar detector and a location positioning device.  Decision at 3. Patent Owner relied upon declaration testimony from the inventor of the ‘905 patent, which stated that the claims at issue were conceived and reduced to practice prior to the effective art dates of two references relied upon by Petitioner. Of course, to establish reduction to practice, a party must show: (1) construction of an embodiment that meets all claim limitations; (2) determine that the invention would work for the intended purpose; and (3) sufficient evidence to corroborate inventor testimony as to the events.  ‘240 Decision at 11.

The inventor testimony stated that a 1992 prototype of the ‘905 invention was constructed prior to the priority date of the references-at-issue. and used a tape recorder to record geographical location of a radar signal. The inventor alleged that this feature met the claimed limitation of a “position determining circuit.” The Board rejected this contention, citing back to its claim construction determination, finding that a tape recorder did not determine geographic position; rather, a tape recorder was only an electronic notepad to record observations of the invention. Id. at 12-13.  Accordingly, the prototype did not reduce all claim limitations to practice.

Inventor also testified that a different 1996 prototype also had a “position determining circuit” in which software code was drafted to demonstrate global positioning capability.  The inventor was forced to concede, however, that the software did not disclose a position determining circuit. The inventor testified that some of the lines of software were missing and Patent Owner could not find any version of the software that contained the missing code.

This hole in the evidence presented by Patent Owner exposed a critical flaw in its objective evidence corroborating reduction to practice; namely, Patent Owner was using the software to corroborate expert testimony, but simultaneously had to use expert testimony to corroborate missing features of the software. Id. at 14-15. The Board also found several statements by the Inventor regarding claimed features of the invention allegedly being reduced to practice to generally lack adequate evidentiary corroboration. Id. at 15.  Accordingly, with a general lack of evidence, Patent Owner in IPR2013-00240 failed to prove conception and reduction to practice prior to the art date of two references relied upon by Petitioner.  Id. at 17.

The Handi-Quilter case involves US Pat. No. 6,883,446, which relates to a method and apparatus for stitching together fabric layers. ‘364 Decision at 12. Patent Owner generally failed to prove conception of several features of the ‘446 invention.  Specifically, Patent Owner did not provide evidence that the inventor had conceived of the limitation, that required controlling the stitch head or needle arm so that it actuates in response to detected movement, prior to the priority date of the art at issue.  Id. at 12.  In fact, the inventor admitted on the record that he had not decided on a control circuit for the prototype until after the art date of the reference at issue.

Further, the Board questioned the reliability of the evidence presented to establish conception and reduction to practice.  The evidence presented was a hand-written sketch of the invention with a date well before that of the reference at issue. Though the hand-written document had a date printed on it, the record showed no corroboration beyond the inventor’s sworn statement that this date was in fact the date the document was created or last-modified.  Id. at 13.  In fact, the document was not seen by anyone besides the inventor until seven years after the date written on the paper.  Further, other testimony attempting to corroborate the inventor’s sworn statement of conception was found to be either unreliable or consisting of bare legal conclusions, not underlying facts. Id. at 14-15. Lastly, demonstrations of the invention by the inventor as detailed by the inventor’s wife weren’t persuasive because the inventor’s wife either did not actually witness the demonstration or the demonstration was only of part of the invention, not all claimed features.  Unsworn statements by the inventor’s sons also weren’t given weight because they weren’t sufficiently independent from the inventor. Id. at 16. Accordingly, the Board found that Patent Owner had failed to prove conception and reduction to practice in attempting to antedate a prior art reference.