Patent Case Summaries August 28, 2019

Patent Case Summaries | Week Ending August 23, 2019

A weekly summary of the precedential patent-related opinions issued by the Court of Appeals for the Federal Circuit and the opinions designated precedential or informative by the Patent Trial and Appeal Board.

Arthrex, Inc. v. Smith & Nephew, Inc., et al., No. 2018-1584 (Fed. Cir. (PTAB) Aug. 21, 2019). Opinion by Stoll, joined by Dyk and Chen.

In a final written decision in an IPR, the Patent Trial and Appeal Board concluded that two claims of Arthrex’s patent were invalid as obvious. In discussing a motivation to combine the cited references, the Board used different language than that advanced in the IPR petition. Specifically, the Board referred to a disclosed embodiment in the prior art as “preferred,” which differed from the petitioner’s characterization of the embodiment as “well-known,” “accepted,” and “simple.”

Arthrex appealed, arguing that the Board’s variation in wording violates the Administrative Procedure Act by crafting new grounds of unpatentability not advanced by the petitioner, without affording Arthrex an opportunity to be heard. Arthrex also argued that the Board incorrectly construed a claim term and that the IPR process is unconstitutional as applied to patents filed before the America Invents Act.

The Federal Circuit rejected each of Arthrex’s arguments. First, the Federal Circuit held that the Board’s use of different language “did not introduce new issues or theories into the proceeding.” The Board had relied on the same portions of the cited reference, considered the same proposed combination, and “ruled on the same theory of obviousness presented in the petition.” Next, the Federal Circuit upheld the Board’s claim construction as well as its substantive finding of a motivation to combine. Regarding motivation, the court acknowledged that “some evidence arguably cuts against the Board’s conclusion,” but reminded that “the presence of evidence supporting the opposite outcome does not preclude substantial evidence from supporting the Board’s fact finding.” Finally, the Federal Circuit rejected Arthrex’s argument that IPR is unconstitutional when applied retroactively to pre-AIA patents. The court did not need to reach the issue since Arthrex’s patent issued after passage of the AIA. The court noted that, in any event, it “recently rejected arguments similar to Arthrex’s in Celgene Corp. v. Peter, No. 18-1167.”

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The Chamberlain Group, Inc. v. Techtronic Industries Co., et al., Nos. 2018-2103, -2228 (Fed. Cir. (N.D. Ill.) Aug. 21, 2019). Opinion by Chen, joined by Lourie and O’Malley.

Techtronic appealed from a district court order denying a motion for judgment as a matter of law (JMOL) that the asserted claims of Chamberlain Group, Inc.’s (CGI) ’275 patent were ineligible for patenting under 35 U.S.C. § 101. Techtronic also appealed a jury verdict that the claims of CGI’s ’966 patent were not anticipated by the prior art.

CGI’s ’275 patent relates to an apparatus and method for communicating information about the status of a movable barrier, for example, a garage door. The Federal Circuit noted that wireless transmission “is the only aspect of the claims that CGI points to as allegedly inventive over the prior art.” Applying the Supreme Court’s two-step Alice framework, the Federal Circuit concluded that representative Claim 1 “is directed to wirelessly communicating status information about a system,” and “the broad concept of communicating information wirelessly, without more, is an abstract idea.” The court also ruled that the physical nature of certain claim elements, such as a controller and transmitter, “is not enough to save the claims from abstractness.” At Alice step two, the Federal Circuit explained that the stated advance of “wireless communication cannot be an inventive concept, because it is the abstract idea that the claims are directed to.” Thus, the Federal Circuit reversed the district court’s JMOL decision.

Next, the Federal Circuit affirmed the jury’s verdict that certain claims of the ’966 patent were not anticipated. At the outset, the Federal Circuit rejected the notion “that two embodiments in a reference can never be considered in combination to make a finding of anticipation,” explaining that the district court was incorrect to the extent it suggested such a blanket rule. But Techtronic did not appeal any jury instruction or other issue on that topic, prompting the Federal Circuit to conclude that any error was “harmless under the circumstances.” On the merits, the Federal Circuit agreed with the district court that the jury’s finding of no anticipation was supported by substantial evidence. Thus, the court affirmed the verdict.

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GoPro, Inc. v. 360Heros, Inc., No. IPR2018-01754 (PTAB POP Aug. 23, 2019). Opinion by Boalick, joined by Iancu and Hirshfeld.

The PTAB Precedential Opinion Panel (POP) held that “service of a pleading asserting a claim alleging infringement triggers the one-year time period for a petitioner to file a petition under 35 U.S.C. § 315(b), even where the serving party lacks standing to sue or where the pleading is otherwise deficient.”

GoPro filed a complaint in a California district court seeking a declaration of noninfringement of a patent held by 360Heros. 360Heros filed a counterclaim for infringement. GoPro then filed a motion for summary judgment, alleging that 360Heros lacked standing to sue. The district court granted the motion, concluding that 360Heros lacked standing. More than one year after GoPro was served with the counterclaim, GoPro filed a petition for IPR challenging the patent.

The POP held that GoPro’s petition for IPR was time-barred under § 315(b), explaining: “if service of a pleading asserting infringement occurred ‘in a manner prescribed by law,’ then the one-year time period for a petitioner to file a petition under § 315(b) is triggered on the date of service. The one-year time period is triggered regardless of whether the serving party lacked standing to sue or the pleading was otherwise deficient.” In so ruling, the POP specifically distinguished “a circumstance in which a party serves a complaint in bad faith, e.g., with knowledge that it lacks standing to pursue its claims of patent infringement or the intent to frustrate a petitioner’s ability to file an IPR.” If that circumstance arises, the POP “may revisit the question of the availability of an equitable tolling of the application of the time bar.”

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