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New Arguments Yield Same Unpatentability Outcome

On remand from the US Court of Appeals for the Federal Circuit in connection with inter partes review (IPR) proceedings, the Patent Trial & Appeal Board considered the petitioner’s reply arguments and evidence regarding the claim constructions that were first proposed in the patent owner’s response but again found that the claims were not unpatentable. Axonics, Inc. v. Medtronic, Inc., IPR2020-00712; -00680 (May 30, 2024) (Tartal, Jeschke, Dougal, APJ)

Axonics filed IPR petitions challenging two patents owned by Medtronic that are directed to the transcutaneous charging of implanted medical devices. In its petitions, Axonics did not propose any express claim constructions. In its preliminary response, Medtronic agreed that claim construction was not necessary. In its patent owner response, however, Medtronic – for the first time – advanced a new claim construction that differed from the interpretation of the relevant claims implied in Axonics’s claim charts. Axonics defended its own implicit construction but also offered new arguments and evidence that the prior art anticipated the patents even under the alternative construction. The Board adopted Medtronic’s new claim construction but refused to consider Axonics’s new arguments and evidence because they were first presented in the reply. The Board then found that Axonics failed to show by a preponderance of the evidence that the challenged claims were unpatentable. Axonics appealed.

Axonics did not dispute the new claim construction first introduced by Medtronic in its response and adopted by the Board; it argued only that the Board erred in refusing to consider its reply arguments and evidence under the new construction. The Federal Circuit agreed, concluding that in such a situation, “a petitioner must be given the opportunity in its reply to argue and present evidence of anticipation or obviousness under the new construction, at least where it relies on the same embodiments for each invalidity ground as were relied on in the petition.” The Court remanded for the Board to consider Axonics’s new arguments.

On remand, the Board considered Axonics’s new arguments and evidence that the challenged claims were unpatentable over the prior art under the new construction. It also considered Medtronic’s amended sur-reply. The Board again determined that none of the challenged claims were unpatentable. In its analysis, the Board pointed out that some of Axonics’s new arguments and evidence regarding what the prior art disclosed in light of the new claim construction were inconsistent with the arguments and evidence it initially offered in its petition. In particular, the Board observed that the declaration testimony of Axonics’s expert regarding the prior art, on which Axonics relied in its petition, did not support the new claim construction, even considering the expert’s supplemental declaration. The Board also rejected Axonics’s attempts in its post-remand brief to discredit Medtronic’s arguments as “untimely and wrong,” “incorrect” and “contradictory of the positions on infringement it has taken in district court.” Citing the Federal Circuit, the Board pointed out that in an IPR, the burden of persuasion to prove unpatentability by a preponderance of the evidence [...]

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The $X Factor: Demystifying Damages Calculations

The US Court of Appeals for the Federal Circuit affirmed a district court’s decision to deny a defendant’s motion for a new trial on damages, finding that the plaintiff’s damages expert sufficiently showed that prior license agreements were economically comparable to a hypothetically negotiated agreement between the parties. EcoFactor, Inc. v. Google LLC, Case No. 23-1101 (Fed. Cir. June 3, 2024) (Reyna, Lourie, JJ.) (Prost, J., dissenting).

EcoFactor owns a patent directed to mitigating strain on the electricity grid by adjusting thermostat settings within HVAC systems. The patent describes a system where thermostats collect internal temperature readings and use them alongside external temperatures to estimate internal temperature change rates, including future predictions. EcoFactor sued Google alleging infringement based on Google’s Nest smart thermostat products.

After discovery, Google sought summary judgment, arguing that claims of EcoFactor’s patent were invalid as abstract ideas under 35 U.S.C. § 101. The district court denied this motion as well as Google’s Daubert motion to exclude the testimony of EcoFactor’s damages expert. At trial the jury found that Google infringed EcoFactor’s patent and awarded damages. The district court denied Google’s subsequent motions for judgment as a matter of law on noninfringement and for a new trial on damages. Google appealed.

Google raised three key issues. First, it argued that the district court erred in denying its motion for summary judgment. Second, Google asserted that the district court erred in denying its motion for judgment as a matter of law concerning the noninfringement of EcoFactor’s patent. Third, Google claimed that the district court wrongly denied its motion for a new trial on damages, arguing that EcoFactor’s damages expert opinion was based on unreliable methodology.

The Federal Circuit upheld the district court’s decision to deny summary judgment because there were genuine issues of material fact warranting a trial. The Court also affirmed the jury’s infringement verdict against Google, finding that it was supported by substantial evidence. Despite Google’s argument that its Nest thermostats did not meet the claims of EcoFactor’s patent, the Court concluded that expert testimony and corroborating documentation demonstrated otherwise.

On the damages issue, Google argued that EcoFactor’s expert testimony was unreliable because there was no evidence that the parties to the three license agreements used by the expert actually applied the royalty rate stated in the agreement. While Google acknowledged that each of the license agreements include a specified royalty rate, Google argued that each also included a “whereas” clause indicating that the licensee would pay EcoFactor a lump sum amount “set forth in this Agreement based on what EcoFactor believes is a reasonable royalty calculation of [$X] per-unit for . . . estimated past and [] projected future sales of products accused of infringement in the Litigation.” Google asserted that while the agreements may have included a stated rate, there was no evidence that the agreements actually applied the rate in calculating the lump sum payment.

The Federal Circuit rejected Google’s argument. The Court explained that the proposed royalty rate was derived from three [...]

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Interference Analysis Is a Two-Way Street

On appeal from an interference proceeding, the US Court of Appeals for the Federal Circuit reversed a Patent Trial & Appeal Board decision that found the claims of the senior party’s patent were not invalid as time-barred under 35 U.S.C. § 135(b)(1). The Federal Circuit concluded that the “two-way test” requires looking to see if either set of pre-critical and post-critical date claims contains a material limitation not found in the other and not just looking to see if the post-critical date claims have additional material limitations. Speck et al. v. Bates et al., Case No. 22-1905 (Fed. Cir. May 23, 2024) (Dyk, Bryson, Stoll, JJ.)

35 U.S.C. § 135(b)(1), pre-AIA, provides that “a claim which is the same as, or for the same or substantially the same subject matter as, a claim of an issued patent may not be made in any application unless such a claim is made prior to one year from the date on which the patent was granted.” This has been described as a statute of repose that places a time limit on a patentee’s exposure to an interference, the deadline for which is referred to as the “critical date.” At issue in this appeal was the “long-standing” exception to § 135(b)(1) for instances where the applicant files its claim after the critical period but has already been claiming substantially the same invention as the patentee during the critical period.

This case involves drug-coated balloon catheter technology. Bates is the senior party that filed a patent application, and Speck is the junior party that owns an issued patent. Speck’s patent issued on September 4, 2012, whereas Bates filed his application on August 29, 2013, six days before the critical date of Speck’s patent (i.e., one year after the filing date). Bates amended the application on August 30, 2013 (still before the critical date), and canceled all of the original claims and replaced them with new claims. Bates later amended the claims after the critical date to add a requirement that the device be “free of a containment material atop the drug layer.” The amendment was made to overcome a rejection from the examiner during prosecution.

Speck filed a motion to terminate the interference on the ground that the claims of Bates’s application were time-barred under § 135(b)(1) because Bates amended the claims more than one year after Speck’s patent issued. Speck also moved the Board to find that the claims of Bates’s application were unpatentable for lack of written description.

The Board denied Speck’s motion to terminate under § 135(b)(1), finding that the later-amended claims did not differ materially from the claims in other patents and patent applications Bates owned that were filed prior to the critical date, because “Speck ha[d] not directed [the Board] to a material limitation of the Bates involved claims that is not present in the earlier Bates claims.” Speck filed a motion for rehearing, which the Board denied. The Board also denied Speck’s motion to find that Bates’s claims lacked [...]

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Sour Grapes: Winery Minority Ownership Insufficient for Statutory Standing at Trademark Board

The US Court of Appeals for the Federal Circuit affirmed the dismissal of a petition seeking to cancel the registered marks of two wineries, finding the petitioner (a trust owning an interest in a competitor winery) lacked statutory standing under 15 U.S.C. § 1064. Luca McDermott Catena Gift Trust v. Fructuoso-Hobbs SL, Case No. 23-1383 (Fed. Cir. May 23, 2024) (Lourie, Reyna, Chen, JJ.) (en banc). The Court found that while the cancellation petitioner, Luca McDermott, had Article III standing to seek judicial review of the Trademark Trial & Appeal Board’s decision, it did not have statutory standing under the Lanham Act to petition for cancellation of the registrations at issue.

Paul Hobbs is a winemaker and partial owner of California-based Paul Hobbs Winery. The Paul Hobbs Winery owns the registration for the PAUL HOBBS mark in International Class 33 for “Wines.” Luca McDermott and two other related family trusts are each limited partners of the winery, collectively owning more than 21% of the business. Paul Hobbs is also affiliated with two other wineries: Fructuoso-Hobbs, a Spanish winery and owner of the registered mark ALVAREDOS-HOBBS, and New York winery Hillick & Hobbs Estate, owner of the registered mark HILLICK AND HOBBS. Both marks are registered in International Class 33 for “Alcoholic beverages except beers; wines.”

Luca McDermott and the other two family trusts petitioned to cancel both of the registered marks on the grounds of likelihood of confusion, alleging that the use of the ALVAREDOS-HOBBS and HILLICK AND HOBBS marks in connection with wine was likely to cause confusion with the Paul Hobbs Winery’s use of the PAUL HOBBS mark for wine. The trusts also alleged that Fructuoso-Hobbs committed fraud because it caused its lawyer, the same lawyer of record who managed the registration of the Paul Hobbs Winery’s PAUL HOBBS mark, to declare that the marks would not be likely to cause confusion with another mark.

Fructuoso-Hobbs moved to dismiss the petition, arguing that the family trusts were not entitled by statute to bring the cancellation action because they were not the owners of the PAUL HOBBS mark. Fructuoso-Hobbs also argued that the trusts could not show they had the necessary “proprietary interest” to bring the likelihood of confusion claim. The Board granted the motion to dismiss. Luca McDermott, one of the three trusts in the original action, appealed.

Before it could review de novo the Board’s decision regarding the trust’s lack of standing under the Lanham Act, the Federal Circuit addressed whether the trust had Article III standing to seek judicial review of the Board’s decision. The Court had little trouble concluding that the alleged injury (i.e., the diminished value of the trust’s investment in the winery) constituted an individual injury-in-fact, even for a minority partner. Furthermore, the Court found that the causation requirement was satisfied because the constitutional standard did not require proximate causation but only that the injury be “fairly traceable” to the allegedly unlawful registration of the challenged marks. Finally, the Federal Circuit found it [...]

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No Attorneys’ Fees Available for Successful IPR in Parallel Court Proceedings

The US Court of Appeals for the Federal Circuit concluded that a party that voluntarily elects to pursue parallel proceedings before the Patent Trial & Appeal Board and the district court is not entitled to recover attorneys’ fees under 35 U.S.C. § 285 (exceptional case doctrine) in connection with the Board proceedings, nor does § 285 entitle a party to hold opposing counsel jointly and severally liable for fees. Dragon Intellectual Property LLC v. Dish Network L.L.C., Case Nos. 2022-1621; -1777; -1622; -1779 (Fed. Cir. May 20, 2024) (Moore, C.J.; Stoll, J.) (Bencivengo, J., dissenting).

Dragon sued DISH Network, Sirius XM Radio (SXM) and eight others for patent infringement. The district court stayed proceedings as to DISH and SXM while they pursued inter partes review (IPR) but proceeded with claim construction for the other defendants. Following claim construction, all parties stipulated to noninfringement, and the district court accordingly entered a noninfringement judgment that was subsequently vacated following appeal to the Federal Circuit. Following the Board’s determination that the asserted claims were unpatentable, DISH and SXM filed a motion for attorneys’ fees in the district court proceeding. The district court granted the motion for time spent litigating the district court case but denied for fees incurred solely during the IPR proceedings and recovery from Dragon’s former counsel. DISH and SXM appealed the denial-in-part, and Dragon cross-appealed the grant-in-part.

The Federal Circuit affirmed the district court’s grant-in-part, finding that the district court did not abuse its discretion in declaring these cases exceptional. The Federal Circuit explained that the vacated noninfringement judgment did not require the district court to ignore its claim construction order in determining exceptionality. The Court further explained that even though Dragon was not entitled to a claim construction “do-over,” the prosecution history disclaimer issue was independently considered during the exceptionality inquiry, and Dragon did not provide any grounds for the conclusion that this constituted an inadequate inquiry.

The Federal Circuit also affirmed the denial of attorneys’ fees with regard to fees incurred during the IPR proceedings and Dragon’s former counsel’s liability for fee awards under § 285.

First, the Federal Circuit rejected DISH and SXM’s argument that § 285 allows recovery of fees incurred during parallel IPR proceedings, principally on the grounds that the IPR proceedings were pursued voluntarily. The Court reasoned that there are many advantages to leveraging IPR proceedings and, therefore, “where a party voluntarily elects to pursue an invalidity challenge through IPR proceedings, we see no basis for awarding IPR fees under § 285.”

Second, the Federal Circuit relied on the statutory text and determined that liability for attorneys’ fees awarded under § 285 does not extend to a party’s counsel. The Court explained that while other statutes explicitly allow parties to recover costs and fees from counsel, § 285 is silent as to who can be liable for a fee award, and therefore it is reasonable to conclude that fees cannot be assessed against counsel.

Sitting by designation, Judge Bencivengo of the US District Court for the Southern District of California dissented [...]

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Getting to the Core of It: Assignment Clause Is Ambiguous

The US Court of Appeals for the Federal Circuit vacated and remanded a district court’s grant of summary judgment, finding that the language used in an invention assignment clause was subject to more than one reasonable interpretation (i.e., ambiguous) and thus remand was necessary for further fact finding. Core Optical Tech., LLC v. Nokia Corp., Case Nos. 23-1001; -1002; -1003 (Fed. Cir. May 21, 2024) (Dyk, Taranto, JJ.) (Meyer, J., dissenting).

Core Optical filed complaints against three groups of defendants alleging patent infringement. The lead defendant, Nokia, moved for summary judgment, arguing that Core Optical did not have standing to bring the patent infringement suit. Nokia argued that by virtue of an invention assignment clause in an employment-related agreement signed in 1990, the inventor, Dr. Core, had assigned the patent rights to TRW, his employer at the time of the invention. In the agreement, Dr. Core “agreed to disclose to TRW and automatically assign to TRW all of his inventions that ‘relate to the business or activities of TRW’ and were ‘conceived, developed, or reduced to practice’ during his employment with TRW.” Nokia argued that by virtue of that earlier assignment, the subsequent assignment to Core Optical was ineffective. The agreement had a carveout from the assignment for inventions “developed entirely on [Dr. Core’s] own time” that was unrelated to his work for TRW. According to Nokia, based on the assignment, Core Optical did not have standing to assert the patent. The district court agreed and granted Nokia’s motion for summary judgment. Core Optical appealed.

The Federal Circuit reviewed the district court’s grant of summary judgment de novo, following Ninth Circuit and California law relating to the underlying contract dispute and related factual determinations. Under California law, the “fundamental goal of contractual interpretation is to give effect to the mutual intention of the parties” (citing City of Atascadero v. MLPF&S (1998)). In granting summary judgment, the district court had held that the 1990 invention assignment agreement’s carveout did not encompass Dr. Core’s PhD research, which undisputedly led to the invention claimed in the patent. That finding was based in part on the TRW fellowship program that supported and enabled Dr. Core’s PhD work. However, Core Optical presented evidence that “Dr. Core was careful not to work on his PhD research while ‘on the clock’ at TRW and not to use TRW equipment, facilities, or supplies when working on his PhD research.”

The Federal Circuit disagreed with the district court that the matter was subject to resolution on summary judgment. The Court agreed with Core Optical that the “entirely-own-time” phrase did not unambiguously express a mutual intent to designate all the time Dr. Core spent performing his PhD research as his own time or, as Nokia argued, to indicate that some of the time Dr. Core spent performing his PhD research was partly TRW’s time (as the district court held). The Federal Circuit walked through the undisputed facts, including that Dr. Core sought funding from TRW for his PhD research and [...]

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Testing Negative: Collateral Order Doctrine Precludes Appellate Jurisdiction

Addressing appellate jurisdiction in view of the collateral order doctrine, the US Court of Appeals for the Federal Circuit dismissed an appeal of a district court’s ruling denying a motion to dismiss because the district court’s order did “not conclusively determine any issue.” Copan Italia S.p.A. v. Puritan Med. Prod. Co. LLC, Case No. 22-1943 (Fed. Cir. May 14, 2024) (Cunningham, Bryson, Stark, JJ.)

Copan and Puritan are competing medical supplies companies. Copan filed suit against Puritan alleging infringement of Copan’s patents for “flocked” swabs, which are used “for collecting biological specimens.” While the lawsuit was filed in 2018, the circumstances surrounding the case changed significantly in March 2020 when the COVID-19 pandemic caused the demand for flocked swabs to skyrocket. In May 2020, the parties agreed to stay the proceedings until the COVID-19 crisis passed.

During the stay, Puritan entered into a contract with the US Air Force, causing Puritan to expand its manufacturing facilities and capabilities. The Air Force stated in a document associated with the contract that, under the Public Readiness and Emergency Preparedness Act (PREP Act), (1) the contract was being entered into for the purpose of covered countermeasures for responding to a public health emergency, (2) Puritan’s performance under the agreement was for recommended activities in responding to the public health emergency and (3) Puritan was a covered person under the PREP Act. Further, the Air Force “expressly acknowledge[d]” that Puritan “shall be immune from suit and liability to the extent and as long as [Puritan’s] activities fall withing the terms and conditions of the PREP Act and the PREP Act declaration.”

Puritan asserted it had immunity under the PREP Act from certain claims in Copan’s infringement suit. Puritan sought leave to amend its answer to include this affirmative defense and filed a partial motion to dismiss the claims directed to Puritan’s performance under the Air Force contract. Copan opposed the motion, arguing the PREP Act does not apply to claims for patent infringement and immunity only applies to claims for losses relating to physical harm, like products liability.

The district court denied Puritan’s motion, finding “that Puritan had not shown, as a factual matter, that its flocked swabs were ‘covered countermeasures’ under the PREP Act.” The district court pointed to “evidentiary gaps,” which prevented Puritan – at the current stage of litigation – from proving the PREP Act affirmative defense. Puritan appealed.

The Federal Circuit determined it lacked jurisdiction and dismissed the appeal. Because the denial of Puritan’s partial motion to dismiss was not a final order, appellate jurisdiction would only arise in limited circumstances under the collateral order doctrine. The collateral order doctrine allows appellate jurisdiction on rulings that (1) conclusively determine a disputed question, (2) resolve an issue completely separate (collateral) to the merits of the action and (3) are effectively unreviewable on appeal from a final judgment.

The Federal Circuit found that the district court order did not conclusively determine any issue and therefore the Federal Circuit lacked jurisdiction under the [...]

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Prime Delivery: Amazon Program Now Offers Personal Jurisdiction to Patent Holders

Addressing the issue of personal jurisdiction in the context of a declaratory judgment case involving a program for resolving patent infringement claims, the US Court of Appeals for the Federal Circuit concluded that a patent owner has personal jurisdiction in the forum of an alleged infringer when it files a program claim against the alleged infringer. SnapRays, dba SnapPower v. Lighting Defense Group, Case No. 23-1184 (Fed. Cir. May 2, 2024) (Moore, CJ. Lourie, Dyk, JJ.)

The Amazon Patent Evaluation Express (APEX) program helps resolve patent infringement claims against sellers on Amazon. Under APEX, a patent owner submits an APEX Agreement to Amazon that identifies the allegedly infringed patent claim and the Amazon listings with the alleged infringing products. Amazon then sends this APEX Agreement to the seller, who can do one of the following to avoid removal of their accused listings:

  • Opt into APEX and let a third party determine whether their product likely infringes
  • Resolve the claim directly with the patent owner
  • File a lawsuit for declaratory judgment of noninfringement. If the seller does nothing, its listings are automatically removed from Amazon within three weeks of receipt of the APEX Agreement.

Lighting Defense Group (LDG), a Delaware company whose principal place of business is in Arizona, submitted an APEX Agreement alleging that SnapPower’s Amazon products (electrical outlet covers with integrated technology) infringed one of its patents. SnapPower, a Utah company whose principal place of business is in Utah, then filed a declaratory judgment action against LDG in Utah. LDG then filed a motion to dismiss for lack of personal jurisdiction. The district court granted the motion, finding that SnapPower did not demonstrate that LDG purposefully directed activities at SnapPower in Utah and that there was no evidence that LDG reached out to Utah other than through responses to SnapPower’s communications. SnapPower appealed.

The Federal Circuit reversed, finding that LDG was subject to personal jurisdiction under the Court’s three-prong test because (1) LDG purposefully directed its activities at SnapPower in Utah, (2) LDG’s submission of the APEX Agreement was directed to SnapPower in Utah and aimed to affect activities in Utah and (3) it would not be unreasonable to find personal jurisdiction over LDG in Utah.

In assessing the first prong, the Federal Circuit found that LDG knew, via APEX’s terms, that Amazon would notify SnapPower of the APEX Agreement and that the options available to SnapPower included a claim for declaratory judgment. Further, the Court found that the APEX Agreement had more power than cease and desist letters because of the automatic removal of the listings after three weeks, which would affect sales and activities in Utah.

In assessing the second prong, the Federal Circuit found that personal jurisdiction comported with due process because LDG’s actions aimed to affect marketing, sales and other activities in Utah and because the suit arose out of LDG’s activities in the forum.

In assessing the final prong, the Federal Circuit rejected LDG’s argument that allowing personal jurisdiction would “open the [...]

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Stud-y Harder: Domestic Industry Must Be Established for Each Asserted Patent

Addressing a final determination by the US International Trade Commission of no violation of § 337, the US Court of Appeals for the Federal Circuit affirmed that the complainant had not satisfied the economic prong of the domestic industry requirement because it relied on aggregated evidence of investments across different products protected by different patents. Zircon Corp. v. ITC, Case No. 22-1649 (Fed. Cir. May 8, 2024) (Lourie, Bryson, Stark, JJ.)

In 2020, Zircon filed a complaint seeking a § 337 investigation based on alleged infringement of four patents covering electronic stud finders. The Commission instituted an investigation, naming Stanley Black & Decker as the respondent. Zircon withdrew one patent during the investigation and, in late 2021, the administrative law judge (ALJ) issued an initial determination finding no violation of § 337. The ALJ found some claims of one of the three patents to be valid and infringed but held that Zircon had failed to establish the economic prong of the domestic industry requirement because it had aggregated its investments across all 53 of its practicing products, of which only 14 practiced all three patents. On review, the Commission affirmed the finding of no violation, holding that all claims were either invalid or not infringed. The Commission also affirmed the domestic industry finding, holding that the aggregation prevented it from evaluating the significance of Zircon’s investments with respect to each of the three asserted patents. Zircon appealed.

The Federal Circuit affirmed on the basis that Zircon failed to meet the second prong of the domestic industry requirement. The Court explained that where different groups of products practice different patents, the complainant must separately establish a domestic industry for each group of products. The Court agreed with Zircon that such a showing might not necessarily require breaking out investments on a per-patent basis but concluded that the complainant must ultimately show that the domestic industry requirement is met for each asserted patent. Because the Federal Circuit upheld the finding of no domestic industry, it found it unnecessary to reach the infringement and invalidity rulings.




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Say What? Recitation Entitled to Patentable Weight When Not “Communicative Content”

Addressing when claimed printed matter is entitled to patentable weight, the US Court of Appeals for the Federal Circuit reversed the Patent Trial & Appeal Board’s ruling involving the printed matter doctrine, explaining that the claimed subject matter was not communicative content. IOEngine, LLC v. Ingenico Inc., Case No. 21-1227 (Fed. Cir. May 3, 2024) (Lourie, Chen, Stoll, JJ.)

Financial technology company Ingenico filed three petitions for inter partes review (IPR) of certain claims from three patents owned by IOEngine, all of which shared the same title and written description. The patents, titled “Apparatus, Method and System for a Tunneling Client Access Point,” claimed a “portable device” that was “configured to communicate with a terminal.” The challenged claims recited a memory that contained program code “configured in various ways to facilitate communication … with a communications network node.”

The Board issued final written decisions, which found the challenged claims to be unpatentable for obviousness or anticipation. The Board also found several claims to be anticipated after giving no patentable weight to certain claim recitations by application of the printed matter doctrine. The Board found that the terms “encrypted communications” and “program code” claim “only communicative content” (i.e., printed matter) and that these recitations were not entitled to patentable weight.

The Board concluded that the recitation of “encrypted communications” was subject to the printed matter doctrine because “nothing in the claim … requires anything beyond sending and receiving data, even if the data is in an encrypted form.” Similarly, the Board found that the recitation “program code” was subject to the printed matter doctrine because the “recital of ‘downloading’ of program code was limited to downloading (sending or transmitting) the code, which is a communication, and no other function is recited in the claim.”

IOEngine appealed, arguing that the Board erroneously construed the term “interactive user interface,” erred in its application of the printed matter doctrine, and erred in its anticipation and obviousness analysis.

The Federal Circuit affirmed the Board’s claim construction, finding IOEngine had forfeited its proposed construction because it did not present it to the Board during the IPR proceeding. Likewise, the Court affirmed the Board’s unpatentability determination of anticipation and obviousness for those claims where the Board did not invoke the printed matter doctrine.

However, the Federal Circuit reversed the Board’s determination that the recitations “encrypted communications” and “program code” were entitled to no weight under the printed matter doctrine.

The Federal Circuit explained that courts use a two-step test to determine whether a recitation should be accorded patentable weight under the printed matter doctrine. First, a court should determine “whether the limitation in question is directed toward printed matter.” Under step one, a limitation should be considered printed matter when the limitation “claims the content of information,” meaning that “the matter [is] claimed for what it communicates.” Only if the first step is met should the court proceed to step two. In the second step, the court considers “whether the printed matter nevertheless should be given patentable [...]

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