Patent Case Summaries May 18, 2022

Patent Case Summaries | Week Ending May 13, 2022

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.

Atlanta Gas Light Co. v. Bennett Regulator Guards, Inc., No. 2021-1759 (Fed. Cir. (PTAB) May 13, 2022). Opinion by Stoll, joined by Lourie. Dissenting opinion by Newman.

In this third appeal relating to an IPR proceeding, the Federal Circuit dismissed the appeal for lack of jurisdiction.

Initially, the Patent Trial and Appeal Board had found that the petitioner was not time barred from petitioning for IPR under 35 U.S.C. § 315(b). The Board also found the challenged claims unpatentable over the prior art. On appeal of those rulings, the Federal Circuit held that the petitioner should have been time barred, and thus vacated and remanded. The remand included instructions that the Board should further consider a sanctions order that the Board had not yet finalized. The sanctions order stemmed from the petitioner’s failure to timely update its identification of real parties in interest.

Before the Board acted on remand, however, the Supreme Court held in Thryv that time-bar determinations are intimately related to institution decisions, which are insulated from appeal under § 314(d). The Supreme Court then granted certiorari in this matter, vacated the Federal Circuit’s opinion, and remanded in view of Thryv. On remand from the Supreme Court, the Federal Circuit considered the merits of the Board’s decision without reviewing the time-bar determination, and affirmed the Board’s determinations of unpatentability. The Federal Circuit again remanded, maintaining its instruction that the Board should further consider its sanctions order.

On remand, the Board vacated its institution decision and terminated the IPR proceedings both as a sanction and due to the Patent and Trademark Office’s policy change on time bar. The Board ruled that the vacatur and termination operated as a sufficient sanction for the petitioner’s failure to timely update its identification of real parties in interest. The petitioner then appealed to the Federal Circuit.

In a divided opinion, the Federal Circuit dismissed the appeal for lack of jurisdiction. The majority concluded that the Board’s termination decision was “multifaceted” and was “based in part on its evaluation of the time bar and was not purely a sanctions decision.” Also, “the Board’s substantive discussion of time-bar considerations was central to its decision.” Thus, the majority ruled that under Thryv, “the Board’s termination decision on remand, which depends on its analysis of § 315(b)’s time bar and changed Patent and Trademark Office policy related thereto, is final and nonappealable.”

Judge Newman dissented. In her view, the Board’s sanctions order “is not excluded from the appellate jurisdiction of the Federal Circuit, as the panel majority holds.” The Federal Circuit’s jurisdiction “is set by statute; no exception excludes the appeal of a sanctions order.” Judge Newman explained that the “only issue on appeal is the Sanctions Order, and all agree that the basis for the sanction is [the petitioner’s] actions relating to the mandatory listing of the real parties in interest.” The Supreme Court’s decision in Thryv did not bar appellate review of a sanctions order that “does not ‘expressly govern[] institution and nothing more.’” Thus, because “no statute, no precedent, removes the sanctions issue from appealability,” Judge Newman stated that “the appropriate path is to accept our jurisdiction of this appeal and to decide the merits” of whether the Board acted reasonably and in accordance with law in its choice of sanction.

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Sound View Innovations, LLC v. Hulu, LLC, No. 2021-1998 (Fed. Cir. (C.D. Cal.) May 11, 2022). Opinion by Taranto, joined by Prost and Mayer.

Sound View sued Hulu for infringement of six patents related to streaming multimedia, but only claim 16 of one of the patents was at issue on appeal. For that claim, the parties disputed the meaning of a limitation requiring downloading and retrieving certain objects. The district court construed the term consistent with Hulu’s view, ruling that the applicants’ statements during prosecution disclaimed the full scope of the limitation such that it requires concurrent downloading from and filling of a single buffer.

Hulu moved for summary judgment of noninfringement because it was undisputed that the accused servers do not download and retrieve subsequent portions of the same object in the same buffer. Sound View responded that there was a factual dispute whether certain caches in the accused servers satisfied the limitation. The district court agreed with Hulu and granted summary judgment of noninfringement. The court ruled that the patent uses the terms “buffer” and “cache” to refer to distinct physical components and, therefore, a cache could not satisfy the limitation requiring a buffer.

Sound View appealed challenging the claim construction, the summary judgment ruling, and two evidentiary rulings excluding certain damages evidence.

First, the Federal Circuit affirmed the claim construction. The court ruled that the claim language itself “is susceptible to being understood, in context, as implicitly calling for use of the same buffer,” and the specification “is not inconsistent with such a reading.” The specification “nowhere says that the invention includes use of separate buffers,” and it describes and illustrates an embodiment with only one buffer. Also, during prosecution, the applicants limited claim 16 to using the same buffer for the required concurrent downloading and retrieval.

The Federal Circuit next vacated the district court’s summary judgment ruling. The Federal Circuit determined that additional claim construction is needed for the term “buffer” in order to assess whether the accused caches fall within or outside of the claimed buffers. The court noted that even in the patent itself “the terms ‘buffer’ and ‘cache’ do not appear to be mutually exclusive, but instead seem to have some overlap in their coverage.”

Lastly, the Federal Circuit found no abuse of discretion in the district court’s exclusion of certain damages evidence relating to the issue of a reasonable royalty. The district court’s rulings were consistent with “basic evidentiary standards requiring reliability and legal relevance of expert testimony.”

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