In Ericsson Inc. v. Intellectual Ventures I LLC, No. 2017-1521 (Fed. Cir. Aug. 27, 2018), Ericsson appealed a PTAB decision finding that claims 1-3, 6-9, and 12-14 of U.S. Patent No. 5,602,831 ("the '831 patent") were not unpatentable for obviousness. Concluding that the Board improperly failed to consider portions of Ericsson's reply brief, the Federal Circuit vacated and remanded the decision for the Board to consider all the arguments in the reply brief.
In its IPR reply brief, Ericsson argued that given that interleaving (an error correction technique) was known in the art, the difference between the technique as claimed and as disclosed in the prior art was insubstantial. However, having determined that the prior art taught only one type of interleaving, the Board declined to consider Ericsson's argument, holding that this was a new theory beyond the scope of a proper reply.
On appeal, the Court found the Board's reasoning erroneous. While affirming the Board's discretion to reject arguments first raised in a reply brief, the Court concluded that the Board parsed Ericsson's reply arguments "with too fine a filter." Here, the '831 patent disclosed that interleaving was known in the art and Ericsson's petition described how a skilled artisan would have been familiar with the concepts of interleaving. Because Ericsson did not identify any new prior art in its reply arguments, the Court determined that Ericsson was entitled to expand on the same rationale in its Petition as to why the prior art disclosures were insubstantially different from the challenged claims to a skilled artisan.
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