Reviewing Partial-Institution Decisions

CRFD Research v. Matal (Fed. Cir. 2017) (Iron Dome)
CRFD Research v. DISH Network (Fed. Cir. 2017)
Hulu, Netflix, and Spotify v. CRFD Research (Fed. Cir. 2017)

CRFD’s U.S. Patent  No. 7,191,233 has been challenged in four separate Inter Partes Review petitions – three of which were granted and reached final decision. Interestingly, the three decisions are somewhat different from one-another.

  • Iron Dome – invalid: Claim 1 anticipated; Claims 4-6 and 8-11 obvious.
  • DISH – invalid: Claims 1, 4, 23, and 25 anticipated; Claims claims 4 and 25 obvious.
  • Hulu – valid: Claims 1–3, 23, and 24 not anticipated; Claims 1–6, 8–11, 13–15, 17–20, 23–25, 29–31, 34–36, and 38–41 not obvious.

The PTAB decisions here may seem inconsistent, but the differences can be explained by the fact that each IPR focused on different prior art references (or combinations thereof).  Note here that the patentee loses (claims are cancelled) if a claim is found invalid in any one of multiple IPR proceedings.  On appeal, the Federal Circuit consolidated the cases and has ruled against the patentee — affirming the Iron Dome and Dish cancellations, but reversing the Board’s nonobviousness decision from Hulu.

The patented invention here is designed to allow someone to start a “session” on a first device but then transferring the session to a second device (along with a session history) so that the user does not need to fully re-initiating the session.”

Claim 1. A method for redirecting an on-going, software based session comprising:

conducting a session with a first device;

specifying a second device;

discontinuing said session on said first device;

transmitting a session history of said first device from said first device to a session transfer module after said session is discontinued on said first device; and

resuming said session on said second device with said session history.

Broad Claims = Invalid: In reviewing the rejections, the Federal Circuit first noted that the key prior art (Phan) taught a somewhat different approach to transferring sessions than the patent at issue. However, anticipation does not involve a disclosure-to-disclosure comparison, but rather asks whether the prior art discloses the invention as claimed.

A patent is invalid for anticipation under 35 U.S.C. § 102 if a single prior art reference discloses all limitations of the claimed invention.

Here, the Board found several of the actual claims of the ‘233 patent were broad enough to encompass Phan’s disclosure – and thus were anticipated.  (Affirming Iron Dome).  Because anticipation is a question of fact, the PTAB’s determinations regarding this issue are reviewed with deference — PTAB findings will be affirmed if supported by more than an iota of evidence, as was done here. On the other hand, obviousness has been deemed “a question of law based upon subsidiary findings of fact.”  As such, the ultimate question of obviousness is reviewed de novo on appeal.

 

= = = =

The Hulu portion of the case is really about IPR procedure.  Hulu had raised several grounds for challenging the patent in its IPR petition, but the PTO selected only a few of the grounds for trial — finding the others redundant. One of the denied grounds argued obviousness, based on Bates alone, while a granted grounds involved a combination of Bates and Chan.  Both of these grounds agreed that Bates alone did not teach the timing of the “transmit session” limitation. Rather the arguments were respectively that (1) the limitation was obvious based upon Bates alone; and (2) the limitation was taught by Chan and the combination was obvious.  IPR was not instituted on the first ground, only the second. At trial, the PTAB found (1) Chan did not actually teach the limitation; and (2) that Hulu was barred from presented the obvious-based-upon-Bates argument since it was denied institution.

On appeal the Federal Circuit has rejected the PTAB’s approach holding that:

The Board, in its discretion, elected to not institute review on Bates alone for redundancy reasons, but instituted review on obviousness grounds that include the only reference—Bates—cited in that ground. To bar Hulu from pressing an argument it raised in a ground the Board found “redundant” and that it expressly incorporated into other proposed grounds of unpatentability on which the Board instituted would not only unfairly prejudice Hulu, but would also raise questions about the propriety of the Board’s redundancy decision.

The Federal Circuit then went on to consider this (and a few other) issues – eventually concluding that the claims were obvious and thus reversing the PTAB decision.

I’ll note here that two major failings of this portion of the Federal Circuit’s decision are (1) that the court offered no standard for its review of the PTAB’s refusal to allow certain arguments; and (2) the court appears to basically be reviewing the partial institution decision — but those are not reviewable under Cuozzo.

39 thoughts on “Reviewing Partial-Institution Decisions

  1. Dennis, the CAFC did not actually review the partial institution decision for Hulu, notwithstanding the comments you identify. Their holding was much more limited and based on the particular way in which Hulu drafted its IPR petition.

    Hulu’s IPR petition expressly incorporated-by-reference its “Bates-only” obviousness arguments into the “Bates+Chan” obviousness ground on which trial was instituted. (See page 28 (“Hulu then incorporated this argument into other grounds of unpatentability—Bates in view of Chan, at least as to claims 1–3, 23, and 24, and Bates in view of Zou—by direct citation to this argument in the petition.”). So the CAFC concluded that it was improper for the Board to ignore the Bates-only arguments made by Hulu, as they were also also asserted to support the Bates+Chan ground on which trial was instituted.

    So the point here isn’t that non-instituted GROUNDS could be pursued on appeal, but that ARGUMENTS made for non-instituted grounds might still be relevant for instituted grounds, particularly when as here they were incorporated into and made part of the instituted grounds. The CAFC did not reverse the PTAB’s redundancy rejection of the “Bates-only” ground, so it’s not really accurate to claim that the CAFC was essentially “reviewing the partial institution decision,” as the original post asserts.

    As to the scope of the arguments, they didn’t have to review the Board’s decision to consider, or not consider, certain evidence, so the lack of articulation of a standard there is immaterial. Any appellate court has inherent discretion to determine the scope of its own appellate record and the record on which its decisions are based. It’s consideration is governed by what’s in its appellate record, regardless of the portions on which the Board chose to focus.

    1. Yes, and at one point made a point of what it could find for itself “within the four corners” of a reference of record.

      1. As I believe the Fed. Cir. has said more than once as to D.C. appeal decisions, “we review decisions, not opinions.”

  2. Re: “PTAB [fact] findings will be affirmed if supported by more than an iota of evidence, as was done here.”
    There is no such evidence test suggested or practiced here, rather, detailed discussions of the specific factual support meeting the APA “substantial evidence” test.

  3. Footnote 10 at the end of this Fed. Cir. decision is the following criticism of PTAB IPR case management:
    “Given the repetitive nature of the issues we have considered across these three appeals, we question whether the Board could have managed these IPRs in a more efficient manner. The record does not reflect any attempt to consolidate these cases to enhance the efficiency of the Board’s examination of the grounds raised against the ’233 patent, even though the petitions were filed within two months of each other and the Board published its decisions to institute review of various claims offered by the petitioners at similar times. Each of these petitions challenged claim 1, along with various other claims, based on two sets of prior art that overlapped over various parts of the proceedings. It is hard to
    see how the Director would not have been authorized under 35 U.S.C. § 315(d) to consolidate these matters.”

    1. Is a “Director being authorized” any indication that such a Director is mandated to do whatever it is that has been authorized?

      I “get” the criticism from the court, but is the court “right” in making such a criticism? Are they really in a position to reprimand a different branch of the government on a matter of discretion (no matter how ‘ill-founded’ the exercise of that discretion may be)…?

      1. I actually agree with you on this point. The CAFC was technically right, the Board could have consolidated those matters given that they were so close in time. I’ve seen the PTAB do it in dozens of IPR proceedings. And arguably they should have done that here.

        But the CAFC should not be reprimanding the PTAB for efficiency issues in how it runs its matters, when those efficiency issues aren’t at issue on appeal and do not touch the merits of the underlying decision. This type of gratuitous footnote comment is one of the reasons people criticize the CAFC in particular for not understanding its limited role as an appellate court, as it too often assumes the role of the lower court in deciding cases. And contrary to what the CAFC may think, the people at the PTO do not take these off-the-cuff footnote (and not even dicta) criticisms to heart; most that I’ve talked to simply roll their eyes and move on.

        1. It’s inefficient (and out of line, but is that new?) for the CAFC to be questioning efficiency of the PTAB.

      2. Is a “Director being authorized” any indication that such a Director is mandated to do whatever it is that has been authorized?

        Wonderful strawman.

        1. You use the word strawman here, but I think that word does not mean what you think it means.

          First, I was not the one that set up “authorized” in order to knock it down.

          Second, the nuanced distinction that I point out is a worthwhile thought to consider.

          Instead of seeking to tr011 me (and apply your number one meme of (Accuse Others), perhaps more time spent from you formulating actual cogent patent law positions would be time better spent for you, eh?

  4. Before the below happens, I ask that all the professors of Santa Clara university review the ethics of Colleen Chien and, in particular, to review the papers she has published in law “journals” and articles she has published in newspapers.

    We’re excited to share some great news: Today, the Santa Clara Law faculty recommended Brian Love for tenure and promotion to associate professor and Colleen Chien for promotion from associate professor to full professor. (The recommendations require full university approval, but it’s expected). Colleen and Brian are cherished faculty members who play essential roles in the High Tech Law Institute and our law school community, and we are thrilled to celebrate their accomplishments and success.

    1. If Colleen will accept the challenge, then I will put together an ethics complaint against her.

      1. Good luck with that (without ‘outing’ yourself and all)

        1. I’d be willing to out myself I Chien would agree to respond to an ethics complaint prior to her promotion.

          Chien is almost as bad as Lemley. I went over an article she published in the Washington Post and it was abysmal.

        2. And risking a defamation suit?

          1. Truth is a defense in an alleged defamation case, right?

              1. Frankly, it is stomach turning that attorneys sit by and do nothing as the academic commit ethics violation after ethics violation.

                They cower in the shadows worried about defamation suits and the power of Stanford coming after them. Shameful.

                That is why we are where we are in this country with patents. Because people like Lemley have been able to do and say whatever he likes and the general population of judges believe him because they believe that Stanford is policing his behavior.

                You want to reform patent? Reform the professors. There are about 10-20 professors in the country that are responsible for burning the patent system down.

            1. Or he can just say that his lawyer writes his blog posts, and his lawyer made a mistake.

              1. I don’t have to make up an excuse because I am saying the truth.

          2. I’ve gone through the article she published with the Washington Post. A defamation suit? As far as I can tell, there are no ethical constraints on law professors. I am sure the professors in the engineering and science departments would be on my side.

          3. When you look at Lemley, he used a graph that was unnormalized to support his hypotheses that the weakening of patents in litigation was not deterring the filing of patents. He didn’t even remove foreign filings much less normalize for the growth in the economy or population.

            This alone supports an ethics complaint of Lemley and is just the tip of the iceberg. (By the way, I am not the only one who says these things. There are professors outside of law that say these things about law professors. In fact, respected scholars who have repeatedly filed complaints against law professors with their law schools with no results.)

            1. When you look at Lemley, he used a graph that was unnormalized to support his hypotheses that the weakening of patents in litigation was not deterring the filing of patents. He didn’t even remove foreign filings much less normalize for the growth in the economy or population.

              This alone supports an ethics complaint of Lemley

              LOL

              Thank goodness you’re not being biased about who you are targeting for these “violations.”

              1. Thinking that sort of thing would fully meet a defendant’s burden of proof, and convince a jury, for a truth defense to a per se professional defamation needs to talk to their insurer.

                1. The burden of proof, Paul, is on the P not the D to show that what I said is both defamatory and false and caused economic loss. Plus, both Lemley and Colleen are very likely public figures based on their biographies.

                  Plus, what I am saying, is the trust.

                2. What is shameful is you Paul. You have a professional duty to call out lawyers who are acting unethical.

                  It is shameful that attorneys are afraid to call out the academics that so clearly act unethically in almost every paper they have published in the non-reviewed vanity press called law journals.

                3. If I ever get around to going after the Lemley’s I will likely include the passive attorneys who knew or should have known about the many ethical violations.

                  The example above about the graph is just one of many. If a scientist had done that, they would be disciplined and likely removed from Stanford.

  5. DC the court appears to basically be reviewing the partial institution decision — but those are not reviewable under Cuozzo

    They are certainly “reviewable” for rational basis. The decisions can’t be arbitrary or capricious.

    1. The decisions can’t be arbitrary or capricious.

      …. with the caveat that a sincere religious belief on behalf of one of the APJ’s will ultimately control. Because … freedom! Smell it. Yummy.

  6. Another surprising Fed. Cir. IPR appeal decision holding that an IPR panel did not cancel Enough claims! [Rather than too many.] However, there are more total Fed. Cir. remands in favor of patent owners – 49 the last I heard.

  7. Just discovered that my African-American client was married to a white guy! Had to fire her just a day before oral arguments in her patent case. The One True God disapproves of the mixing of races, and I sincerely believe that, so tough luck for all you intermingled types (and that includes gingers marrying blondes, by the way). I know the model code says stuff about not firing clients and leaving them in the lurch but, hey, my sincere religious beliefs vastly outweigh these silly earthly considerations.

    The important thing is that Justice Kennedy is sleeping so much better because Hillary’s scandalous behavior isn’t in the news all the time. <– actual view shared by the patent maximalists

  8. He is pushing an agenda and his agenda is sexual in nature, his agenda is liberal, and not what Americans need. It’s not our American culture. Soros comes from another world that I don’t identify with. […] No matter how much money he’s got, he’s still going to the same place that people who don’t recognize God and morality and accept his salvation are going. And that’s not a good place.

    New York City isn’t that bad, really.

    The important thing is that my checks keep coming. Next up: why my sincere religious beliefs prevented me from filing a supplemental IDS citing a paper by a gay scientist. Nothing inequitable about that! Just obeying the teaching of the one true god, who also really likes young women by the way.

  9. “It violates my sincere religious beliefs to recognize the validity of a g@y person’s patent.”

    “It violates my sincere religious beliefs to recognize the validity of a heterosexual person’s patent.”

    “It violates my sincere religious beliefs to recognize the validity of a sexual person’s patent.”

    Seems like we’ve got all the bases covered here. Fun times! Who knew that toxic @ h0le and discriminatory “religious” were so precious? I mean, other than the N@ zi types who pollute everything they touch.

  10. Those claims are quintessentially ineligible g@ rbage and, in a just system, the attorneys who are defending them should be sanctioned.

    But we don’t have that kind of a system. We have a system built for entitled b0 tt0m feeders who grift for a living 6 days a week and spend the rest of their time screeching on the Internet about how relatively difficult it is to be a well-heeled extortionist these days. Boo hoo hoo! So hard to get l@ id, too, when you can’t lock the secretary in your office.

    Claim 1. A method for redirecting an on-going, software based session comprising:

    conducting a session with a first device;

    specifying a second device;

    discontinuing said session on said first device;

    transmitting a session history of said first device from said first device to a session transfer module after said session is discontinued on said first device; and

    resuming said session on said second device with said session history.

    There are no non-frivolous arguments that can be made in defense of this claim. None.

    1. transmitting a session history

      Right here is Problem Numero Uno. Give everyone a break, please.

  11. Maybe the CAFC misunderstood what the Supreme Court was saying in the SAS oral arguments (and did the opposite)…

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