inter partes review : CAFC Alert

A “Teaching Away” Argument Must be Commensurate in Scope with the Claims

Andrew Melick | October 17, 2017

Idemitsu Kosan Co., Ltd. v. SFC Co. Ltd.

September 15, 2017

Before Prost, O’Malley and Chen. Opinion by O’Malley.

Summary:

This case is an appeal from an inter partes review of Idemitsu Kosan Co., Ltd’s (“Idemitsu”) U.S. Patent No. 8,334,648 (“the ‘648 patent”) brought by SFC Co. Ltd. (“SFC”). Idemitsu argued on appeal that the Patent Trial and Appeal Board (“PTAB”) did not explain why a skilled artisan would have been led to use the claimed combination of compounds from the teachings of the prior art reference Arakane given that Arakane limits its combination of compounds to combinations satisfying a special relationship. The CAFC agreed with the PTAB in holding that the Arakane reference teaches compounds (including the claimed compounds among others) that when combined, produce a light emitting layer, regardless of the special relationship. The CAFC further held that “evidence concerning whether the prior art teaches away from a given invention must relate to and be commensurate in scope with the ultimate claims at issue.” In this case, the CAFC said that it is not particularly important that Arakane teaches that combinations of compounds not satisfying the special relationship result in poor performance because the claims at issue do not include limitations with respect to performance.

Details:

Idemitsu’s ‘648 patent is to an “Organic Electroluminescence Device and Organic Light Emitting Medium.” Claim 1 is provided below:

 1.  An electroluminescence device comprising a pair of electrodes and a layer of an organic light emitting medium disposed between the pair of electrodes, wherein the layer of an organic light emitting medium is present as a light emitting layer and comprises:

(A) an arylamine compound represented by formula V:

 

wherein X3 is a substituted or unsubstituted pyrene residue,

Ar5 and Ar6 each independently represent a substituted or unsubstituted monovalent aromatic group having 6 to 40 carbon atoms, and

p represents an integer of 1 to 4; and

(B) at least one compound selected from the group consisting of anthracene derivatives and spirofluorene derivatives, wherein

said anthracene derivatives are represented by formula I:

wherein A1 and A2 may be the same or different and each independently represent a substituted or unsubstituted monophenylanthryl group or a substituted or unsubstituted diphenylanthryl group, and L represents a single bond or a divalent bonding group, and by formula II:

 

wherein An represents a substituted or unsubstituted divalent anthracene residue, A3 and A4 may be the same or different and each independently represent a substituted or unsubstituted aryl group having 6 to 40 carbon atoms, at least one of A3 and A4 represents a substituted or unsubstituted monovalent condensed aromatic ring group or a substituted or unsubstituted aryl group having 10 or more carbon atoms; and

said spirofluorene derivatives are represented by formula III:

 

 

 

wherein Ar1 represents a substituted or unsubstituted spirofluorene residue, A5 to A8 each independently represent a substituted or unsubstituted aryl group having 6 to 40 carbon atoms;

provided that the organic light emitting medium does not include a styryl aryl compound.

SFC petitioned for an inter partes review (IPR) of the ‘648 patent. The Patent Trial and Appeal Board (“PTAB”) instituted review of the claims on the grounds of obviousness based on a single reference to Arakane (WO 02/052904). The Arakane reference is assigned to Idemitsu and teaches an organic electroluminescence device. Arakane discloses:

The present invention provides an organic electroluminescence device including a pair of electrodes and an organic light emitting medium layer interposed between the electrodes wherein the organic light emitting medium layer has a mixture layer containing (A) at least one hole transporting [“HT”] compound and (B) at least one electron transporting [“ET”] compound and the energy gap Eg1 of the [HT] compound and the energy gap Eg2 of the [ET] compound satisfy the relation Eg1<Eg2.

Among the HT compounds, Arakane discloses a compound corresponding to formula V of claim 1. And among ET compounds, Arakane discloses compounds corresponding to compounds of formulas I and II of claim 1, respectively.

The PTAB held the claims of the ‘648 patent to be obvious over Arakane. Specifically, the PTAB held that Arakane’s HT compound corresponds with the formula V compound of claim 1; that Arakane’s ET compounds correspond with compounds of formulas (I) and (II) of claim 1; and that Arakane teaches that a light emitting layer can be formed by combining an HT and ET compound. The PTAB stated that the claimed invention “is the combination of recited components in a light emitting layer” and that “Arakane’s disclosure would have informed an ordinary artisan that combining components (A) and (B) would produce a light emitting layer.” The PTAB further stated that the obviousness of the combination “does not depend on whether the resulting light emitting layer would satisfy Arakane’s energy gap relationship.”

Idemitsu argued on appeal that the PTAB made no finding with respect to the energy gap relationship taught in Arakane, i.e., that the energy gap of the HT compound must be less than the energy gap of the ET compound. The CAFC stated that the PTAB correctly found that Arakane suggests combinations of HT and ET compounds that produce a light emitting layer, regardless of their energy gap relation.

Idemitsu also argued that this was raised too late because it was not in SFC’s petition or in the PTAB’s institution decision. However, the CAFC stated that Idemitsu is the party that implicitly raised the argument by arguing that SFC failed to explain why a skilled artisan would have been led to use the combination of HT and ET compounds given that Arakane limits the combination of compounds to combinations satisfying the energy gap relationship. In its counterargument, SFC argued that Arakane does not teach away from the claimed combination despite the absence of demonstrating that the combination would possess the preferred energy gap relationship. The CAFC stated that SFC’s statements were “the by-product of one party necessarily getting the last word,” and thus the argument was not raised too late.

The CAFC also noted that Idemitsu provided no supporting evidence for its position that Arakane teaches away from non-energy gap HT/ET combinations, and that SFC was not required to rebut attorney argument with expert testimony.

The CAFC further stated that Idemitsu’s argument regarding “teaching away” is of questionable relevance. The CAFC explained that “evidence concerning whether the prior art teaches away from a given invention must relate to and be commensurate in scope with the ultimate claims at issue.” The CAFC also included the following passage from In re Zhang, 654 F. App’x 490 (Fed. Cir. 2016): “While a prior art reference may indicate that a particular combination is undesirable for its own purposes, the reference can nevertheless teach that combination if it remains suitable for the claimed invention.” The claims at issue do not include limitations with respect to performance characteristics. And Arakane teaches that the only drawback of not satisfying the energy gap relationship is poor performance. Thus, the CAFC concluded that it is of substantially reduced importance that the non-energy-gap HT/ET combinations result in poor performance.

Take Away

As a patent applicant or patent owner, when arguing that a reference teaches away from a claimed invention to demonstrate non-obviousness, you should try to explain why the reference teaches unsuitability of the claimed invention. Relying solely on a teaching of undesirability in the prior art may not be enough to demonstrate a teaching away from the claimed invention.

This case also emphasizes the importance of supporting arguments with expert declarations in inter partes reviews. Idemitsu did not provide evidence supporting a teaching away argument. Thus, SFC and the PTAB could rely solely on the text of the reference.

Full Opinion

U.S. Patent 8,334,648

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A Patent Owner in an IPR is entitled to an opportunity to respond to asserted facts

Andrew Melick | December 16, 2016

In Re: NuVasive, Inc.

November 9, 2016

Before Moore, Wallach and Taranto.  Opinion by Taranto.

Summary:

Medtronic filed two petitions for inter partes review (IPR) against U.S. Patent 8,187,334 to a spinal fusion implant owned by NuVasive. The claims of the ‘334 patent recite two size requirements: that the length of the implant is greater than 40 mm and that the length to width ratio is 2.5. In both petitions, Medtronic cited the combination of two references for teaching the size limitations. In the patent owner responses, NuVasive addressed the combination of references as in Medtronic’s petition. However, in Medtronic’s reply, Medtronic changed its reliance to just one of the cited references for teaching both of the size limitations citing a different portion of the reference. The PTAB ultimately relied on Medtronic’s changed position in its final decision. In one IPR, the CAFC held that NuVasive had an opportunity to respond because Medtronic’s petition was at least minimally sufficient to provide notice. However, in the second IPR, NuVasive was not given proper notice to respond.


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Burden of Proof does not shift to Patent Owner upon institution of an Inter Partes Review

Andrew Melick | August 1, 2016

In Re: Magnum Oil Tools International, LTD.

July 25, 2016

Before Newman, O’Malley, and Chen. Opinion by O’Malley

Summary:

McClinton Energy Group, LLC (“McClinton”) filed a petition for inter partes review (“IPR”) of U.S. Patent No. 8,079,413 (“the ‘413 patent”) owned by Magnum Oil Tools International, Ltd. (“Magnum”). McClinton based the petition on two combinations of prior art references: (1) Alpha in view of Cockrell and Kristiansen, and (2) Lehr in view of Cockrell and Kristiansen. The petition primarily focused on the combination of Alpha, Cockrell and Kristiansen, and merely “incorporated by reference” the arguments based on Alpha for the arguments based on Lehr. The IPR was instituted based only on Lehr in view of Cockrell and Kristiansen, and in a final decision, the claims were found unpatentable. The CAFC reversed the PTAB decision stating that the arguments “incorporated by reference” are not sufficient for meeting the burden of proving obviousness by a preponderance of the evidence. Conclusory statements cannot satisfy the petitioner’s burden of demonstrating obviousness, and thus the PTAB did not have sufficient evidence on which to base its legal conclusion of obviousness. The PTAB improperly shifted the burden to Magnum to disprove obviousness without requiring McClinton to prove its assertion of obviousness. The CAFC also stated that it was improper for the PTAB to rely on an unpatentability theory that was not included in the petition.


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Denying effect to functional language in a patent claim is unreasonable

Andrew Melick | March 23, 2016

Dell Inc. v. Acceleron, LLC

March 15, 2016

Before Moore, Taranto and Hughes. Opinion by Taranto

Summary:

Dell filed a petition for an inter partes review (“IPR”) of U.S. Patent No. 6,948,021 (the ‘021 patent) owned by Acceleron. The Patent Trial and Appeal Board (“PTAB”) confirmed the validity of claims 14-17 and 34-36 and cancelled claims 3 and 20 as being anticipated by U.S. Patent No. 6,757,748 to Hipp. Agreeing with the PTAB’s decision that the Hipp reference does not disclose as programmed being capable of performing functions recited in claim 14, the CAFC affirmed the PTAB’s confirmation of claims 14-17 and 34-36. Regarding claims 3 and 20, the CAFC vacated the PTAB’s decision to cancel and remanded. CAFC stated that the PTAB unreasonably denied effect to the functional language “to remotely poll” recited in claim 20. For claim 3, the CAFC stated that Acceleron was denied “notice and a fair opportunity to respond” to Dell’s new argument raised at the oral argument and relied on by the PTAB in its decision.


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PTAB Decision to Institute a CBM is Final and Non-Appealable

Thomas Brown | December 17, 2015

SightSound Technologies, LLC v. Apple Inc.

December 15, 2015

Precedential Opinion by Dyk, joined by Lourie and Hughes.

Summary

Apple filed petitions with the PTAB seeking CBM review of patents owned by SightSound under AIA. In the petitions, Apple argued that certain claims of the patents were invalid as anticipated under 35 U.S.C. § 102. The Board instituted CBM review finding that there was a reasonable likelihood that the asserted claims were anticipated or rendered obvious by prior art. However, while Apple’s petitions included alleged facts to support obviousness, the petitions did not specifically allege obviousness over the prior art. The Board initiated review on obviousness grounds anyway. During the CBM proceedings the Board gave SightSound extra time to respond to the obviousness grounds, but SightSound argued that it has been deprived due process to respond to the obviousness grounds on which the CBM review had been instituted. The PTAB entered a final decision based on the obviousness grounds from which SightSound appeals to the CAFC, but the CAFC rules that they are barred under 35 USC 314(d) and 35 USC 324(e) from reviewing the decision to initiate the CBM proceedings.


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Tense Decision: CAFC Reverses PTAB Decision Based on the Meaning of the Word “Is”

Darrin Auito | December 2, 2015

Straight Path IP Group, Inc., v. Sipnet EU S.R.O.

November 25, 2015

CAFC Panel and opinion author: Before Dyk, Taranto, and Hughes. Opinion for the court filed by Taranto. Opinion concurring in part and dissenting in part filed by Dyk.

Summary: In an appeal from an Inter Partes Review, the CAFC reversed the Board’s decision cancelling claims 1-7 and 32-42 based on determinations of anticipation and obviousness, and remanded for further proceedings under a new claim construction.

Details

I.  Background

 Straight Path IP Group, Inc. (Straight Path) owns U.S. Patent No. 6,108,704, (“the ‘704 patent”) which describes protocols for establishing communication links through a network.

Sipnet EU S.R.O. (Sipnet) filed a petition for inter partes review against the ‘704 patent, and the PTAB instituted a review. Straight Path contended that the relevant prior art references (NetBIOS and WINS) do not read on the patent claims because the claims require a real-time check, which is not disclosed by the references. Relying on the specification, which indicates that the database only need be “relatively current,” (col. 5, lines 39-42) the PTAB rejected this construction and determined that according to the broadest reasonable interpretation (BRI standard) in light of the specification (1) claims 1-7 and 32, and 38-42 are anticipated by NetBIOS, (2) claims 1-7 and 32-42 are anticipated by WINS, and (3) claims 33-37 are obvious over NetBIOS and WINS. Sipnet EU S.R.O. v. Straight Path IP Group, Inc. (IPR2013-00246).   The PTAB adopted Signet’s view under the BRI standard in view of the specification, namely that “is connected to the computer network encompasses a processing unit that is ‘active and on-line at registration” and reached its conclusion in part because Straight Path agreed that the second process was “active and on-line” at least at registration in both NetBIOS and WINS.

Claim 1 is representative of the asserted claims (emphasis added to highlight the key claim phrase at issue):

1.  A computer program product for use with a computer system, the computer system executing a first process and operatively connectable to a second process and a server over a computer network, the computer program product comprising:

a computer usable medium having program code embodied in the medium, the program code comprising:

program code for transmitting to the server a network protocol address received by the first process following connection to the computer network;

program code for transmitting, to the server, a query as to whether the second process is connected to the computer network;

program code for receiving a network protocol address of the second process from the server, when the second process is connected to the computer network; and

program code, responsive to the network protocol address of the second process, for establishing a point-to-point communication link between the first process and the second process over the computer network.

 

 

 

 

 

On appeal, the patentability issues ultimately depend on the construction of the term “is connected to the network.”

II.  Decision

a. The CAFC reversed the PTAB’s cancellation of the challenged claims and remanded for further proceedings based on a new claim construction

In a 2-1 decision, a majority seized on the present tense meaning of “is” in the claim language and held that the PTAB’s construction of the disputed phrase “is not a reasonable interpretation of the claim language, considering its plain and ordinary meaning.”

According to the majority, “the query required by the claim language asks if the callee ‘is’ online, which is a question about the status at the time of the query. But the [PTAB] did not address the facially clear meaning, instead turning immediately to the specification.” The majority highlighted that in this situation, “the specification plays a more limited role than in the common situation where claim terms are uncertain in meaning in relevant aspects.” Regardless, the majority stated that the specification does not provide a basis for reasonably adopting a construction that contradicts the plain meaning of the claim language (i.e., passage relied upon by PTAB says nothing more than that the unit is active and online – available for communication – at the time it registers.) The majority also jumped on an exchange at oral argument wherein Sipnet’s counsel agreed that “[w]hen somebody registers, that registration means, right then and there, they’re active and online” and “[t]hat could be out of date (a day later)”. The majority also emphasized that “the plain meaning is positively confirmed by the prosecution history, which we have indicated is to be consulted even in determining a claim’s broadest reasonable interpretation.” The majority cited arguments made by Straight Path to overcome a rejection during reexamination (e.g., “NetBIOS does not teach that an active name in NetBIOS is synonymous with ‘whether the second process is connected to the computer network.’”)

Sipnet’s attempt to challenge the claim language for not adequately describing or enabling the systems or processes involving a query about current connection status under Straight Path’s claim construction was rejected by the majority, which pointed out that the statute limits IPR challenges to prior-art, not written-description and enablement. 35 U.S.C. 311(b).

Straight Path’s challenge that PTAB failed to construe “process” was rejected because it did not preserve that contention, e.g., did not request construction in its preliminary response, in its response after the PTAB initiated review, or at the oral hearing before the PTAB.

The majority therefore remanded this case to the PTAB in order to apply the construction – “is connected to the computer network at the time the query is transmitted to the server” – in considering the prior art, including NetBIOS and WINS.

b. Dissent – The word “is” does not require “absolute currency”

In a separate opinion, J. Dyk dissented from the majority’s claim construction of the term “is connected to the computer network” to require absolute currency in a real-time assessment of connectivity.

First, using the following hypothetical example, J. Dyk argued that ordinary usage easily accommodates the Board’s interpretation of “is connected.”

“If a person says that ‘John is at home,’ this might lead to the question: ‘How do you know?’ The response ‘I spoke to him five minutes ago’ would not be viewed as contradicting the original statement, even though John might have left home in the intervening five minutes. In other words, the use of the word ‘is’ does not necessarily imply absolute accuracy or absolute currency.”

J. Dyk continued by attacking the majority for minimizing the role of the specification during claim construction. “[U]nder the Phillips approach, we must look to the specification as the ‘single best guide to the meaning of a disputed term.’ This is true, contrary to the majority’s assertion, even in cases were language, on its face, appears to have a plain meaning, because, as Phillips states, the specification ‘is always highly relevant to the claim construction analysis.’” (emphasis added).

J. Dyk points out that the specification “describes that, when a query is received, the server ‘searches the database … to determine whether the callee is logged-in by finding any stored information corresponding’ to that queried user” (emphasis added) … and that “[t]his information in the database, as described in the specification, is kept ‘relatively current.” According to J. Dyk, checking historical “relatively current” information in a database is not a “real time” determination and that there is no disclosure in the specification that would warrant construing “is connected” to require absolute accuracy, as required by the majority.

Lastly, J. Dyk argued that the majority’s insistence that “is” requires absolute currency is contrary to this Court’s prior decision in Paragon Solutions, LLC v. Timex Corp 566 F.3d 1075 (CAFC 2009), holding that a reference to “real time” does not necessarily require absolute currency.

Take Away

• The PTAB will interpret claims of an unexpired patent using the broadest reasonable interpretation (BRI) in light of the specification. See Office Patent Trial Practice Guide, 77 Fed. Reg. 48,756, 48,766 (Aug. 14, 2012); 37 CFR 42.100(b); In re Cuozzo Speed Techs., LLC, 793 F.3d 1268, 1279 (CAFC 2015).

• The BRI standard does not apply to expired patents (e.g., when a patent term expires during the PTO-litigation proceeding). Instead, the claim construction standard moves to a standard “pursuant to the principle set forth by the court in Phillips v. AWH Corp., 415 F.3d 1303, 1316, 75 USPQ2d 1321, 1329 (Fed. Cir. 2005) (words ‘are generally given their ordinary and customary meaning’ as understood by a person of ordinary skill in the art in question at the time of the invention)” [MPEP §2258.I.G].

• Consider advancing claim constructions under the BRI standard and the Phillips standard if there is a chance that a patent in a PTO-litigation proceeding will expire before the end of the proceeding.

• Typical assumption – The Phillips standard results in a narrower construction than the BRI standard. However, in this case, both the majority and dissent concluded there is “no significant difference between the Phillips and BRI standards.”

• Always be prepared to answer questions at oral hearing (CAFC and PTAB). Here, the majority seized on an exchange between Sipnet’s counsel and the Court to support its claim construction position.

• A Final Written Determination is not necessarily final. The CAFC has reversed two PTAB decisions invalidating claims, in addition to reversing other PTAB decisions validating claims.

• Claim drafting – Words matter. Tense matters. Recognize the significance.

Full Opinion

U.S. Patent 6108704

CAFC emphasizes “would have motivation” in obviousness determinations from Inter Partes Reviews

Michael Caridi | November 11, 2015

Belden, Inc. v. Berk-Tek, LLC

November 5, 2015

CAFC Panel and opinion author: Before Newman, Dyk and Taranto. Opinion by Taranto

Summary:

In an appeal from an Inter Partes Review, the CAFC rejected all claims of the ‘503 patent as being obvious over the prior art, emphasizing that the test for obviousness focuses on whether the skilled artisan would have a motivation to modify or combine the prior art disclosures to reach the claimed invention. The Court further upheld the authority of the Board to allow for consideration of a late filed Declaration by the Petitioner.


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CAFC’s majority says that a PTO’ decision to institute IPR is not appealable even after a final decision and a broadest reasonable interpretation rule applies in IPR

Yoshiya Nakamura | July 22, 2015

In Re Cuozzo Speed Technologies, LLC

July 8, 2015

Before: Newman, Clevenger, and DYK. Opinion by DYK. Dissenting opinion by Newman.

Summary

Garmin filed in the PTO a petition to institute an inter partes review (IPR) on patented claims owned by Cuozzo. The PTO granted the petition to institute the IPR and concluded that the claims at issue were obvious over prior art. Cuozzo appealed to CAFC, arguing: (1) the petition was defective as failing to identify prior art references for each claim; and (2) a broadest reasonable interpretation (BRI) standard should not be applied in the obviousness determination. CAFC held: (1) the statute prohibits a review on the PTO’s decision to institute the IPR even the final decision was on appeal; and (2) the BRI standard applies in IPR.

Japanese Summary

本判決は、(1)第三者の請求に基づく特許付与後レビュー(inter partes review; IPR)においてその請求書の内容に問題があった場合にそれをCAFCが審査できるか否か、および(2)クレーム解釈の基準として、最大限に広い合理的な解釈(a broadest reasonable interpretation: BRI)をIPRの審査に使用してよいか否かという争点に関するものである。

IPRは2段階の手続きであり、まず特許庁は第三者が提示した請求内容がIPRでの審査を開始するための要件を満足しているかを決定し、レビューを開始すると決定した場合、特許クレームが無効であるか否かを決定する。本件では、文献の引用が一部欠落しているクレームに対して特許庁がレビューを開始し、無効の結論を出した。特許権者はレビュー開始の決定が違法であるとして控訴したが、CAFCは、特許庁がレビューを開始するという決定は控訴可能な対象ではなく、特許庁が正しい引用例で結論を出したので問題ではないと判断した。

またIPRではクレーム補正の機会は制限され、従前の再審査よりも司法手続きに近い制度である。特許権者は、補正制限等のあるIPRでは、クレーム解釈の基準として、最大限に広く合理的な解釈(BRI)を使用すべきではないと主張した。CAFCは、IPRを含めて特許庁における付与後見直しにBRIの基準を使用することは長年の運用で認められており、法律上も問題ないと判断した。
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