A Lesson from Judge Chen on Waiver vs Forfeiture

by Dennis Crouch

In re Google Technology Holdings LLC (Fed. Cir. 2020)
Decision authored by Judge Chen and joined by Judges Taranto and Stoll

This is an ex parte appeal of a patent office refusal to grant a patent to Google on its U.S. Pat. App. No. 15/179,765 (distributed caching of content for video-on-demand).  The examiner rejected the claims as obvious and that was affirmed by the PTAB.  On appeal here the Federal Circuit affirms on forfeiture grounds:

Because we conclude that Google has forfeited its arguments put forth on appeal, we affirm.

Slip Op.  Most of the opinion actually focuses on the legal distinction between “waiver” and “forfeiture,” primarily citing to the 1993 Supreme Court Case of US v. Olano and its predecessor Johnson v. Zerbst (1938). 

Waiver is different from forfeiture. Whereas forfeiture is the failure to make the timely assertion of a right, waiver is the “intentional relinquishment or abandonment of a known right.”

Olano, quoting Johnson. The difference between these two terms is somewhat parallel to that of laches and equitable estoppel. Laches can apply to bar a claim in situations where a plaintiff unreasonably delayed in making the claim (much like a statute-of-limitations).  Equitable Estoppel, on the other hand, requires some action by the plaintiff – a misleading statement or conduct – that was detrimentally relied upon.

Here, on appeal Google argues that the PTAB erred in its claim construction of Google’s claim terms of “cost” of delivering data and “network penalty.”  However, Google did not present those particular arguments to the PTAB and thus forfeited them:

Meritorious or not, Google never presented these arguments to the Board. And therein lies the problem. Because Google failed to present these claim construction arguments to the Board, Google forfeited both arguments.

Slip Op.

The basic rule here is that “a position not presented in the tribunal under review will not be considered on appeal in the absence of exceptional circumstances.”  In this case, the court found no such exceptional circumstances.

Sua Sponte by the Court: Note here, the forfeiture is a bit tricky because apparently neither Google nor the Patent Examiner requested or briefed claim construction of the “Cost” term before the Board. Rather the Board construed the terms sua sponte.  On appeal, the Federal Circuit found that in this situation it had discretion regarding whether or not to hear the appeal, but declined to do so.  The court reasoned that Google should have argued the claim construction issue if it thought the issue important.

Google has not provided any reasonable explanation as to why it never argued to the examiner during the iterative examination process or later to the Board for a particular construction of the term “cost,”—an argument that is now the linchpin to its claims’ patentability. Allowing Google to press, on appeal, a specific claim construction that it did not present to the Board deprives the Board, an expert body, of its important role in reviewing the rejection of patent applications. Moreover, Google has not explained how the Board’s understanding of “cost” altered the theory underlying the examiner’s rejection or otherwise was a surprising, unexpected departure.

Slip Op.  The court admitted that in other cases it has reviewed issues raised sua sponte by the PTAB — but that such review has always been discretionary.

11 thoughts on “A Lesson from Judge Chen on Waiver vs Forfeiture

  1. 3

    “One likely outcome of a request for rehearing would have been an explanation from the Board that the allegedly ‘new claim construction’ wasn’t actually dispositive of the outcome, which the appellate panel expressly noted.”

    So if it wasn’t “dispositive” why did the PTAB need to make a “new” claim construction?

    That would be typical of the PTAB’s response to request for rehearings. Neither the examiner nor the appellant felt the term “cost” needed interpretation so neither addresses it, on appeal the PTAB gives the term a construction and affirms. Appellant files a request for rehearing noting that the PTAB decided the case on something that was never addressed by either the appellant or the examiner, and the PTAB responds with, “Well, it wasn’t dispositive so rehearing denied.”

  2. 2

    The Google attorney’s should have requested rehearing at the Board in response to the Board raising the claim interpretation issue sua sponte. With any luck, the might have prevailed there and avoided the CAFC.

  3. 1

    Seriously? “You should have known that the board would raise this issue sua sponte so you should have argued it below.” Wow. That’s contrary to both rationality and law. And disgusting. Even if the appellant is Google.

    “Hey client, the examiner didn’t raise this point, but, you know, it’s possible the board might raise it of its own volition in the decision, so I’ll need to spend time (and bill for it) arguing this hypothetical point, and creating file wrapper estoppel in the process.”

    1. 1.1

      I agree that such blindsiding by the Board is reprehensible, as is the phrase “surprising, unexpected departure.” J. Chen expects an appeal brief to anticipate and address issues or arguments that were not and might not ever be made?

      Unfortunately, such blindsiding been all too common at both the Board and from the examining corps (I hated second Action Final from day one).

      As for the more important point: The client might well ask why counsel didn’t move for reconsideration of the sua sponte construction by the Board so as to preserve the matter for appeal. It’s basic procedure.

      The additional cost would have been small compared to the cost of a full-blown appeal, and — however unlikely — might have persuaded the Board to change its position.

    2. 1.2

      Requests for reconsideration are a thing at the PTAB.

      1. 1.2.1

        Yes, as Don Dunner publicly noted for years, if attorneys hired for a Fed. Cir. appeal of rejected pending application claims note an argument that should have been made below, then for a legal issue file a reconsideration request with the Board, if there is still time for that. But if the argument also needs factual evidence and/or an expert opinion a substitute continuation application should be filed to get it into the record.

        1. 1.2.1.1

          I took a class from Dunner. He did say exactly that.

      2. 1.2.2

        > Requests for reconsideration are a
        > thing at the PTAB.

        That probably wouldn’t have mattered. There’s plenty of authority for the idea that you cannot preserve an argument for a merits appeal by raising it, for the first time, in a request for rehearing after the challenged Board decision.

        But strategically speaking, many experienced practitioners would generally advise against seeking rehearing and instead going straight to appeal. If you check the stats, you’ll find that the Board almost never flips the outcome of decisions based on requests for rehearing.

        And a request for rehearing often makes the appeal record worse for the challenger. By filing a request that identifies the alleged errors in the Board’s decision, you give the Board a roadmap to issue a new order cleaning up the record in an attempt to bulletproof the decision on appeal.

        1. 1.2.2.1

          interesting – thanks LR

        2. 1.2.2.2

          There may be “plenty of authority” against raising new arguments in a request for rehearing, but I suspect not much against the right to respond to new issues raised sua sponte by the Board. Due process, after all.

          Not sure what “many” experienced practitioners means in this context, where the Board acted outside the scope of the issues raised on appeal. But the consequences of failing to request reconsideration are quite evident from J. Chen’s opinion.

          A worse record for the appellant? Failing to request reconsideration worked out well for Google, didn’t it. Of course, the Board would have the same “roadmap” on remand.

          And a “bulletproof” adverse Board decision can have advantages for the client, most notably, the injection of certainty into the business strategy.

          1. 1.2.2.2.1

            A lot of bizarre things were stated in your comment, Cass, but this one takes the cake:

            >And a “bulletproof” adverse Board
            >decision can have advantages for the
            >client, most notably, the injection of
            >certainty into the business strategy.

            You don’t need to tank your own client’s chances on appeal by filing a request for rehearing, just to inject “certainty into the business strategy.” Your client could just choose not to appeal. Boom. 100% certainty.

            But the big flaw in your thinking is that it’s driven entirely by hindsight. Google’s lawyers probably made the conscious decision at the time not to seek rehearing, possibly for the same reasons I mentioned above. And just because Google ended up losing the Federal Circuit appeal doesn’t mean the decision to not seek rehearing was erroneous at the time.

            If Google had sought rehearing here, they probably would still have lost in the end and on appeal, but would have lost even more handily as Google would have had fewer arguments for appeal. One likely outcome of a request for rehearing would have been an explanation from the Board that the allegedly “new claim construction” wasn’t actually dispositive of the outcome, which the appellate panel expressly noted.

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