In this series of monthly updates, we summarize decisions from September 2022 where the Federal Circuit reversed or vacated the Patent Trial and Appeal Board ("Board") or trial court rulings, which can provide guidance on how to succeed on appeal.
Quick takeaways:
- Golden v. Apple Inc.: the district court erred in dismissing a patent infringement claim as frivolous when the complaint included a detailed claim chart mapping features of an accused product to independent claims of the asserted patents.
- Apple Inc. v. MPH Techs. Oy: the Board erred when it construed "encrypted" messages to require "that the message is encrypted—not that a portion of the message is encrypted" when the specifications contemplated that "encrypted" messages could be sent using outer packets with certain unencrypted addressing information.
- Cap Export, LLC v. Zinus, Inc.: the district court's summary judgment of invalidity under the on-sale bar was vacated because genuine disputes of material fact existed about whether the product instructions – which satisfied every element of claim 1 – applied to the on-sale product.
- Provisur Techs., Inc. v. Weber, Inc.: the Board violated the Administrative Procedure Act (APA) for not addressing all of Provisur's patentability arguments; and remand was warranted due to the Board's focus on prior art not relied on by the petitioner and its failure to consider the petitioner's asserted prior art, as well as inconsistent findings.
- Cooperative Entertainment, Inc. v. Kollective Tech. Inc.: the district court erred in dismissing the complaint and finding claims ineligible. The Federal Circuit held that the claims recited specific, inventive technical solutions that did not exist in the prior art. The district court should have denied the motion to dismiss because there was a plausible factual issue regarding the inventiveness of the asserted claims.
Golden v. Apple Inc., No. 22-1229, No. 22-1267, 2022 WL 4103285 (Fed. Cir. Sep 8, 2022)
The district court dismissed Golden's patent infringement claims as frivolous. On appeal, the Federal Circuit affirmed the dismissal of the Apple case, finding that Golden's complaint against Apple contained nothing more than a list of patent claims and accused products. The district court erred in dismissing the Google case, however, because the complaint against Google included a detailed claim chart mapping features of an accused product to independent claims of the asserted patents. The court distinguished Golden's infringement chart for Google products from charts in a prior case that was dismissed as frivolous. The Federal Circuit thus vacated the dismissal of the Google case.
Apple Inc. v. MPH Techs. Oy, No. 2021-1355, 2021-1356, 2022 WL 4103286 (Fed. Cir. Sep. 8, 2022)
MPH sued Apple for infringement in district court, and Apple filed multiple IPR petitions. In two of those IPRs, the Board found some claims unpatentable and some claims patentable. Apple appealed. The Federal Circuit agreed with Apple that the Board erred in its analysis of certain "encrypted" claim limitations but affirmed the remainder of the Board's decisions.
Specifically, the Board interpreted the claimed "encrypted" messages to require "that the message is encrypted—not that a portion of the message is encrypted." Based on this interpretation, the Board concluded that the prior art did not disclose this limitation because its request message included an outer packet that was unencrypted. The Federal Circuit disagreed, finding that, contrary to the Board's construction, the specifications contemplated that "encrypted" messages could be sent using outer packets with certain unencrypted addressing information.
Therefore, the Federal Circuit vacated the portions of the Board's final written decisions that relied on that erroneous claim construction and remanded for further proceedings.
Cap Export, LLC v. Zinus, Inc., No. 21-2159, 2022 WL 4376407 (Fed. Cir. Sep. 22, 2022)
Zinus asserted a patent directed to a mattress support system that can be shipped with all of its components compactly packed into the headboard. The district court entered summary judgment of invalidity under the on-sale bar. Zinus appealed. The Federal Circuit vacated the summary judgment because material factual disputes existed regarding whether the on-sale product anticipated the asserted claims.
The invalidity theory was based on the sale of a particular "Mersin" bed, which came with assembly instructions that on their face indicated they were for a different bed—the "Fusion" bed. The parties disputed whether the instructions also applied to the Mersin bed. Zinus presented testimony suggesting the Fusion bed instructions might have been mistakenly included in the Mersin bed box. The district court reviewed the evidence and concluded that no reasonable jury could find that the Fusion instructions did not apply to the as-sold Mersin bed. To do so, however, the court had to make factual inferences in favor of the moving party. The district court also ignored a declaration that contained factual assertions that undermined the court's factual conclusion that the Fusion assembly instructions applied to the Mersin bed.
In sum, while Cap Export presented evidence connecting the Fusion instructions to the Mersin bed, genuine disputes of material fact remained that precluded summary judgment. The Federal Circuit therefore vacated the district court's summary judgment and remanded for further proceedings.
Provisur Techs., Inc. v. Weber, Inc., No. 21-1942, 2022 WL 4474941 (Fed. Cir. Sep. 27, 2022)
Weber petitioned for inter partes review. The Board concluded that Weber had proved some claims unpatentable, but not others. Provisur appealed and Weber cross-appealed. Regarding Provisur's appeal, the Federal Circuit affirmed the Board's denial of Provisur's motion to exclude Weber's reply evidence, but found the Board violated the APA by failing to address all of Provisur's patentability arguments. Regarding Weber's appeal, the Federal Circuit decided that the Board erred in upholding the patentability of claims 11 and 12.
Under the APA, the Board must fully and particularly set out the bases for its decision. Here, regarding certain claim limitation, the Board adopted Weber's arguments and evidence and noted that Provisur had not disputed those arguments and evidence. That was not true, because Provisur plainly argued that the prior art did not render obvious the limitation. The Federal Circuit held that the Board's adoption of Weber's argument and evidence, coupled with its mischaracterization of Provisur's arguments, violated the APA and precluded the court from conducting meaningful appellate review.
Turning to Weber's cross-appeal, the Board concluded that Weber had failed to show that a certain prior art reference disclosed a claim limitation. As the court noted, however, Weber's IPR petition did not rely on that reference to satisfy the claim limitation. Instead, Weber relied on other prior art references for the disclosure, but the Board never addressed those arguments. More importantly, the Board erred because its findings for claims 11 and 12 were inconsistent with those it made for other claims. Therefore, the Federal Circuit vacated the Board's decision regarding claims 11 and 12.
The asserted patent related to systems and methods of structuring a peer-to-peer (P2P) dynamic network for distributing large files, namely videos and video games. The district court held that at Alice step one, the asserted patent focused on the abstract idea of preparing and transmitting content to peers through a computer network and that at step two, the patent merely implemented the abstract idea with generic computer components using conventional technology.
The district court thus held all claims of the asserted patent ineligible under Section 101 and dismissed Cooperative's amended complaint.
The Federal Circuit reversed the dismissal, because the claims plausibly alleged at least two inventive concepts. The first inventive concept was the required dynamic P2P network, where multiple peer nodes consumed the same content and were configured to communicate outside the content distribution networks. The specification explained how such P2P network structure was different from and improved upon the prior art, and the amended complaint reiterated the benefits. Drawing all inferences in favor of Cooperative, the Federal Circuit concluded that claim 1 recited a specific technical solution that was an inventive concept and did not exist in the prior art. Also, the solution allegedly reduced costs and improved system performance. At a minimum, the district court should have denied the motion to dismiss because the allegations in the complaint created a plausible factual issue regarding the inventiveness of claim 1.
The second inventive concept required that trace routes be used in content segmentation. The specification explained that segmenting content using trace routes had benefits over the prior art: providing increased reliability, more redundancy, and more efficient delivery. Cooperative's allegations that claim 1's use of trace route segmentation was an inventive concept were sufficient to preclude dismissal at the Rule 12 stage.
In sum, the Federal Circuit held that the district court erred in dismissing the complaint.
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