HP v. MPHJ (Fed. Cir. 2016)
Over the past few years, MPHJ has raised the ire of many with its enforcement campaign of U.S. Patent No. 6,771,381. The claims seemingly cover HP’s multi-function scanner-printers that can be configured to email the scanned documents. However, rather than suing HP for infringement, MPHJ sent letters to tens of thousands of businesses who HP printers seeking royalties. A number of states took direct action against MPHJ, including Vermont and Nebraska.
HP’s response to this was to file an inter partes review proceeding challenging all 15 claims of the ‘381 patent. IPR2013-00309. The PTAB largely sided with HP – finding 14 of the claims unpatentable, but confirmed the patentability of claim 13. HP appealed on claim 13, but the Federal Circuit has affirmed the Board ruling.
HP challenged claim 13 on both obviousness and anticipation grounds. However, the Board refused to institute review on the obviousness grounds — seeing that ground a ‘redundant’ to the two counts of anticipation. The unique aspect of claim 13 is that it requires a “list of available module means for maintaining a registry” (e.g., “input, output, and process modules”). This list was not found in either of the two separate anticipation references (Cotte or SJ5) as such, the Board found no anticipation.
As a question of fact, an anticipation conclusion by the Board is given substantial deference on appeal and will be affirmed if “a reasonable mind might accept the evidence presented as sufficient to support the finding.” Here, the appellate panel agreed that at least some evidence supported the conclusion that the element was missing from the prior art since HP was “unable to specify” how the required list was disclosed in the prior art.
HP also challenged the Board’s refusal to institute on obviousness grounds and its failure to explain its redundancy conclusion. On appeal, the Federal Circuit refused to address that issue — finding that appellate review of the institution decision is barred by statute.
Allowing an APA challenge to the Board’s decision to institute on the basis that the Board had insufficiently articulated its reasoning would eviscerate § 314(d) by allowing substantive review of the institution decision. Although there is a strong presumption of judicial review of administrative action, that presumption may be overcome where “there is persuasive reason to believe that such was the purpose of Congress.” Bowen v. Mich. Acad. of Family Physicians, 476 U.S. 667 (1986). Congress, through § 314(d), has explicitly stated that the Board’s institution decision “shall be final and nonappealable.” Thus, that specific statutory language precludes our review.
It is unclear to me at this point whether Claim 13 is valuable – i.e., do the current HP models infringe? I guess that we’ll see.
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MPHJ’s case against Vermont is still pending before the U.S. Supreme Court.
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The court here did not address how HP had standing to appeal, from the briefs neither party addressed that issue as well.