CAFC looks to complete disclosure of patent at issue and its related patents to counter patent owner’s arguments based on cherry-picking.

Linda Shapiro | February 8, 2018

Paice LLC v. Ford Motor Company

February 1, 2018

Before Lourie, O’Malley, and Taranto.  Opinion by O’Malley


Due to error in the PTAB’s interpretation of incorporation by reference, the CAFC vacated the PTAB’s obviousness determination with respect to claims that relied on the incorporation by reference for their written description, and found substantial evidence to affirm the PTAB’s findings of obviousness of all other claims.


Paice appealed six inter partes review  (“IPR”) decisions of the Patent Trial and Appeal Board (“PTAB”) holding certain claims of Paice’s related U.S. Patent Nos. 7,237,634 (“’634 patent”) and 8,214,097 (“’097 patent”) unpatentable.  The ‘634 and ‘097 patents both name Severinsky and Louckes as inventors and are both titled “Hybrid Vehicles.”  They are described by the CAFC as being “directed to a torque-based algorithm for selecting operating modes in a hybrid vehicle having an internal combustion engine and one or more battery- powered electric motors,” with “[t]he claims at issue generally [reciting] methods for comparing the instantaneous torque required to propel the vehicle, which the patents refer to as ‘road load’ (‘RL’), to both a setpoint (‘SP’) and the engine’s maximum torque output (‘MTO’) to determine whether to operate the engine, the electric motor, or both.”

Claim 241 of the ‘634 patent is representative and reads as follows:

241.  A method for controlling a hybrid vehicle, comprising:

determining instantaneous road load (RL) required to propel the hybrid vehicle responsive to an operator command:

operating at least one electric motor to propel the hybrid vehicle when the RL required to do so is less than a setpoint (SP):

operating an internal combustion engine of the hybrid vehicle to propel the hybrid vehicle when the RL required to do so is between the SP and a maximum torque output (MTO) of the engine, wherein the engine is operable to efficiently produce torque above the SP, and wherein the SP is substantially less than the MTO; and

operating both the at least one electric motor and the engine to propel the hybrid vehicle when the torque RL required to do so is more than the MTO:

controlling said engine such that combustion of fuel within the engine occurs substantially at a stoichiometric ratio, wherein said controlling the engine comprises limiting a rate of change of torque output of the engine; and

if the engine is incapable of supplying instantaneous torque required to propel the hybrid vehicle, supplying additional torque from the at least one electric motor.

Also at issue are so-called “electrical” claims that recite limitations related to the voltage and current output of the electric motor’s battery, of which claim 245 is representative and reads as follows:

245.  The method of claim 241, wherein said operating the at least one electric motor comprises supplying energy from a battery; wherein a maximum DC voltage supplied from said battery is at least approximately 500 volts.

These “electrical” claims first appeared in a continuation-in-part application filed on April 2, 2001. The ‘634 patent is a divisional of a divisional of that application.

Finally, a third group of claims at issue relate to torque output levels.  Claim 265 is representative and reads as follows:

265.  The method of claim 241, further comprising: operating the engine at torque output levels less than the SP under abnormal and transient conditions to satisfy drivability and/or safety considerations.

Claims 7, 17, 27, and 37 of the ’097 patent also recite this “abnormal and transient conditions” limitation.

The Board’s unpatentability determinations are based on two primary references: (1) U.S. Patent No. 5,343,970, which names Severinsky alone as the inventor (“Severinsky”), and (2) PCT Application Publication WO 00/15455 (“’455 PCT publication”), which names Severinsky and Louckes as inventors.  The ‘455 PCT publication claims priority to two U.S. provisional applications and a U.S. non-provisional application from which the ‘634 and ‘097 patents also claim priority.

The CAFC characterizes Severinsky as describing “a control strategy for selecting operation modes in a hybrid vehicle. Severinsky teaches that its vehicle’s internal combustion engine is used only near ‘its most efficient operational point,’ which Severinsky defines as when the engine ‘produces 60–90% of its maximum torque.’… Severinsky also describes circumstances in which it is efficient to use the engine (such as ‘in highway cruising’), other circumstances in which it is more efficient to use an electric motor (such as ‘in traffic’), and still other circumstances in which torque is supplied by both the electric motor and the engine (such as in ‘acceleration/hill climbing mode’).”  The ‘455 PCT publication describes similar technology.

The PTAB found “that Severinsky discloses a torque-based algorithm for determining which operating mode to select in a hybrid vehicle,” as recited in claim 241 of the ‘634 patent.

In order to reach a determination regarding claim 265 and similar claims, the PTAB had to interpret the term “abnormal and transient conditions.”  The PTAB determined that “abnormal and transient conditions” include starting and stopping the engine, which is disclosed by Severinsky.

Finally, the Board determined that the ‘455 PCT publication discloses the torque-based control strategy recited in the electrical claims of the ‘634 patent, and that Severinsky discloses the electrical limitations themselves.

Paice based its appeal on three main arguments:

  1. Severinsky discloses a speed-based algorithm, not a torque-based one as required by the patent claims.
  2. The PTAB erred in its construction of “abnormal and transient conditions.”
  3. The PTAB erred in finding that the ‘455 PCT publication qualifies as prior art to the ‘634 patent’s electrical claims.

Severinsky’s disclosure of a torque-based algorithm

Noting that the Board’s ultimate legal determination of obviousness is reviewed de novo and its underlying factual findings for substantial evidence, the CAFC reviewed Severinsky’s disclosure in light of the PTAB’s findings, and found that while Severinsky discloses a speed-based algorithm, it also discloses torque as a factor in determining whether to operate the engine, the electric motor, or both. The CAFC also pointed out that the description of Severinsky in the ‘634 patent says that an important aspect of Severinsky is the use of the amount of torque required to determine whether the engine or the electric motor is used to drive the vehicle. This description amounts to an admission in the specification regarding the prior art, which is “binding on the patentee for purposes of a later inquiry into obviousness.”  Moreover, the PTAB’s findings regarding Severinsky’s teachings were consistent with the CAFC’s rulings in previous, related appeals.

Construction of “abnormal and transient conditions”

With respect to the “abnormal and transient conditions” limitation, the CAFC agreed with the Board’s construction.  Neither the ‘634 patent claims nor the specification define what “abnormal” or “transient” conditions are. In the absence of intrinsic evidence, the PTAB referred to the ‘634 patent’s parent patent, No. 7,104,347 (“’347 patent”), claim 22 of which recites “abnormal and transient conditions” comprising “starting and stopping of the engine and provision of torque to satisfy drivability or safety considerations.”

The CAFC affirmed as correct the PTAB’s finding that while “claim 22 of the ’347 patent does not present a definition, … [it] identifies non-limiting examples of abnormal and transient conditions–i.e., (1) starting and stopping of the engine, and (2) provision of torque to satisfy drivability or safety considerations,” that the PTAB “appropriately concluded that ‘abnormal and transient conditions’ include starting and stopping the engine,” and that “[t]his conclusion is reasonable; [because] starting and stopping the engine is a ‘transient’ condition insofar as it is temporary. Once the engine is on, the condition has ceased.”

This interpretation is reinforced by the prosecution history of the ’097 patent, in which Paice stated “that the ‘abnormal and transient conditions’ recited in the claims ‘are such conditions as starting the engine, during which operation it must necessarily be operated at less than SP for a short time.’”

According to CAFC precedent, it is “presumed, unless otherwise compelled, that the same claim term in the same patent or related patents carries the same construed meaning.”  Paice did not contest the PTAB’s finding that “abnormal and transient conditions” should have the same meaning across the patents.

The ‘455 PCT publication’s status as prior art

With respect to the ‘455 PCT publication, Paice did not dispute that it, in combination with Severinsky, teaches the claims in question, but argued that the ‘455 PCT publication is not prior art to the electrical claims because the electrical claims claim priority to U.S. Application No. 09/264,817 (“’817 application”), which predates the ‘455 PCT publication, and which incorporates Severinsky by reference.  The PTAB found that the ‘817 application did not incorporate Severinsky by reference, and therefore the ‘817 application did not provide written description support for the electrical claim limitations.

Precedent requires that “[t]o incorporate material by reference, the host document must identify with detailed particularity what specific material it incorporates and clearly indicate where that material is found in the various documents.”

The incorporation by reference in the ‘817 application reads as follows:

This application discloses a number of improvements over and enhancements to the hybrid vehicles disclosed in the inventor’s U.S. Pat. No. 5,343,970 (the “’970 patent”) [Severinsky], which is incorporated herein by this reference. Where differences are not mentioned, it is to be understood that the specifics of the vehicle design shown in the ‘970 patent are applicable to the vehicles shown herein as well.

The PTAB focused on the second sentence in concluding that the incorporation was limited “to only those disclosures in Severinsky that are not different from disclosures in the ‘817 application.”  The CAFC disagreed, holding that the second sentence “refers to differences from Severinsky only to the extent necessary to describe differences between the inventions of Severinsky and the ‘817 application….  When read in context, the passage makes clear that it incorporates the entire Severinsky document into the ‘817 application, but applies only some of the specific features of Severinsky’s invention disclosed in that document to the ‘817 application’s invention.”

Because the PTAB had found there was no incorporation by reference of Severinsky, the PTAB did not make a determination whether Severinsky provided sufficient written description of the electrical claim limitations.  The CAFC accordingly remanded to the PTAB for consideration of this issue.


Ignore at your own risk the well-established principle that in determining obviousness under section 103, “it is impermissible to pick and choose from any one reference only so much of it as will support a given position, to the exclusion of other parts necessary to the full appreciation of what such reference fairly suggests to one of ordinary skill in the art.@  Moreover, be wary of terms that are used by the inventor to describe the invention but that do not have well-established meanings, and be sure to provide a definition that is consistent with the inventor’s intention.

Full opinion

U.S. Patent 5,343,970

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