PMC Patent is Unenforceable Because an Applicant Must Prosecute its Applications in an Equitable Way, Even Though the USPTO Doesn’t

Ini Personalized Media Communications, LLC v. Apple Inc., [2021-2275] (January 20, 2023), the Federal Circuit affirmed the district court’s determination that U.S. Patent No. 8,191,091 was unenforceable based on prosecution laches.

The district court determined that Personalized Media Communications successfully employed an inequitable scheme to extend its patent rights. Relying on the Federal Circuit’s decision in Hyatt, the court determined that laches required a challenger to prove that the applicant’s delay was unreasonable and inexcusable under the totality of the circumstances
and that there was prejudice attributable to the delay. Under this framework, the court found that PMC engaged in an unreasonable and unexplained delay amounting to an egregious
abuse of the statutory patent system.

The Court found that similar to Hyatt, PMC’s applications were atypically long and complex, containing over 500 pages of text and over 22 pages of figures. PMC filed each of its applications with a single claim, then subsequently amended the claims, sometimes to recite identical language across different applications. The court further explained that, like in Hyatt, over time, PMC greatly increased the total number of claims in the range of
6,000 to 20,000 claims. The court also found the length of the delay similar to
Hyatt because PMC waited eight to fourteen years to file its patent applications and at least sixteen years to present the asserted claims for examination.

The court reasoned that PMC’s prosecution conduct made it virtually impossible for the PTO to conduct double patenting, priority, or written description analyses. In addition to the scope and nature of PMC’s applications, the court pointed to PMC’s vast prior art disclosure, which
included references having little-to-no relevance, and examiners’ statements in office actions describing PMC’s prosecution strategy and conduct as improper. Regardless, prosecution had been pending for “nearly ten years” before the PTO suspended it.

The only notable distinction the court found between Hyatt and this case was that while Hyatt acknowledged he lacked a master plan for demarcating his applications, PMC developed the “Consolidation Agreement” with the PTO, under which PMC agreed to group its applications into 56 subject-matter categories, with subcategories for each of the two priority dates. The court determined that the Consolidation Agreement alone does not operate to shift blame on the PTO, explaining that the Consolidation Agreement had to be understood in the context of PMC’s business-driven, unreasonable prosecution strategy.

The court analyzed prosecution conduct concerning the asserted ’091 patent and found that PMC used the Consolidation Agreement to realize PMC’s initial strategy of serialized prosecution, notwithstanding the GATT amendments. Thus, the court found that Apple met its burden to prove the first element of laches.

The court reasoned that the prosecution delays had to be understood in the context of PMC’s expressed desire to extend its patent rights as long as possible and conceal its inventions until infringement was deeply embedded into the industry. This scheme contributed to the prejudice, which was underscored by the fact that a jury found that Apple’s FairPlay technology infringed the ’091 patent. Thus, Apple established prejudice, and laches rendered the ’091 patent unenforceable.

On appeal, PMC first argued legal error because its conduct looks nothing like Hyatt or the handful of other cases that have found prosecution laches. The Federal Circuit found that this was not a legal error and is factually incorrect. PMC nest asserts that its “compliance” with the Consolidation Agreement and the PTO’s rules precludes a finding of laches as a matter of law. The Federal Circuit disagreed. Third, PMC asserted that the district court improperly disregarded the reasons for the prosecution’s length. PMC points to delays in prosecution that occurred due to the PTO grappling with PMC’s GATTBubble
applications and attempting to resolve overlapping issues across many of PMC’s applications. The Federal Circuit rejected this as well, pointing out that “a delay by the PTO cannot excuse the appellant’s own delay.”

Fourth, PMC argued that the district court committed legal error by relying on the simple number of PMC’s applications. This argument also failed, the Federal Circuit saying that the district court here did not legally err by considering that PMC filed 328 GATT-Bubble applications as a part of the court’s analysis, which also properly considered
other relevant facts.

Fifth, PMC argued that it was a legal error for the district court to find delay due to PMC adding “narrowing” limitations directed to encryption and decryption in 2003, years after the priority date of the ’091 patent. In light of the significant amendments made in 2003, we
are not persuaded that the district court erred in concluding that PMC unreasonably delayed in presenting the encryption and decryption subject matter.

The Federal Circuit said that in sum, the district court did not legally err. The district
court correctly considered the totality of the circumstances and did not disregard or ignore relevant facts.

Leaving One’s Mark

We have frequently commented in this blog about how the U.S. patent collection records historic events in the country. So it should not be surprising that Dr. Martin Luther King’s “I have a Dream,” left its mark not just on society, but in the patent collection. His speech has been referenced in at least 22 patents:
























Dr. King indisputably left his mark on the world, but he also left a mark on the patent collection. We salute a great American on what would be his 94th birthday, as we still wait for his dream to come true, sixty years later.

The Inventor’s Lexicography Governs

In Grace Instrument Industries, LLC v. Chandler Instruments Company, LLC, [2021-2370] (January 12, 2023), the Federal Circuit vacated the district court’s finding that the claims of U.S. Patent No. 7,412,877 were indefinite.

The ‘877 patent relates to a viscometer for measuring the viscosity of drilling fluid. The discometer uses a “enlarged” chamber located between a lower chamber, housing the sample fluid, and a pressurization fluid inlet, located in the top section of the viscometer’s
pressure vessel. This enlarged chamber is large enough such that the level of the sample fluid, which before pressurization initially fills both the lower chamber and the enlarged chamber, never falls below the transition point between the lower chamber and enlarged chamber when the application of the pressurization fluid compresses the sample fluid.

1. A pressurized device comprising:
(a) a pressure vessel within which is vertically disposed at least one top section filled
with a pressurization fluid of a first density and at least one lower section filled with a test sample of a second density,
(b) an enlarged chamber with reduced openings positioned between the at least one top section and the at least one bottom section for communicating pressure with said top section and said lower section within said pressure vessel,
(c) whereby said pressurization fluid would not mix with said test sample because of the nature of their density difference.

The district court determined that the term “enlarged chamber” as used in the claims was indefinite, making the asserted claims of the ‘877 patent invalid. The district court explained that “enlarged” is a “term of degree” that “necessarily calls for some comparison against
some baseline.” Finding that the ’877 patent “does not provide the requisite objective boundaries” for a skilled artisan, the district court held that “enlarged chamber” is indefinite.

The Federal Circuit said that a patent is invalid for indefiniteness if its claims, read in light of the specification delineating the patent, and the prosecution history, fail to inform, with reasonable certainty, those skilled in the art about the scope of the invention.” The ultimate conclusion that a claim is indefinite under 35 U.S.C. § 112, ¶ 2 is a legal conclusion, which we review de novo.

Grace argued before the district court that the term “enlarged chamber” should be construed as “the area between reduced openings that is large enough to hold excess test sample (i.e., the type of fluid normally used in these machines) to prevent mixing of pressurization fluid and test sample below the bottom fin during elevated pressurization.” The district court declined to adopt that construction, concluding that the ’877 patent fails to disclose objective
boundaries for a skilled artisan to know what the claimed “enlarged chamber” must be larger than. The Federal Circuit said that this was error.

The Federal Circuit said that the intrinsic record informs a skilled artisan that the ’877 patent and its claims are directed to a viscometer with an “enlarged chamber” that is large enough to prevent pressurization fluid from entering the lower section of the pressure vessel—where the viscosity of the test sample is being measured—during elevated pressurization. In other words, the enlarged chamber has to be able to contain enough sample fluid at the pre-pressurization stage such that, during pressurization, the sample fluid level does not fall below the bottom of the enlarged chamber and into the viscometer’s lower, testing section. Although “enlarged chamber” is not a term of art, the intrinsic record sufficiently guides a skilled artisan to the meaning of that term as used in the ’877 patent. Where the specification instructs as to the meaning of a claim term, “the inventor’s lexicography governs.”

The Federal Circuit concluded that the term “enlarged chamber” in the ’877 patent meant “a chamber that is large enough to contain excess test sample prior to pressurization to prevent mixing of the test sample and pressurization fluid in the lower measurement zone when the test sample is pressurized to maximum rated pressure.” The Court thus vacated the district court’s determination that “enlarged chamber” is indefinite, vacatef the district court’s invalidity determinations based thereon, and remanded for further proceedings
consistent with this opinion.

Board Decision Vacated; Patentability Determination is Confined to the Grounds upon which the Board Actually Relied

In In re Google, [2022-1012] (January 9, 2023) the Federal Circuit vacated the PTAB’s decision affirming the final rejection of Google’s application methods for filtering the
results of an internet search query such that only results appropriate for the user (e.g., age appropriate) are displayed.

The Board adopted the examiner’s findings, and purported to “agree with the Examiner” that modifying Parthasarathy’s threshold “to take into account query length as taught by Rose” would have been obvious at the time of filing.

On appeal, the PTO argued that the Board’s decision should be affirmed because there are only two ways to predictably modify Parthasarathy’s threshold to incorporate query length as taught by Rose, and both would have been obvious to try. Specifically, it asserts a skilled artisan would have recognized that Rose’s adjusted relevance score could be used to modify either Parthasarathy’s search-query-intent score or its threshold and that either modification would predictably result in a threshold based on the number of words in a query.

Meritorious or not, the PTO’s arguments cannot sustain the Board’s decision below because they do not reflect the reasoning or findings the Board actually invoked. It is a foundational
principle of administrative law that a court may uphold agency action only on the grounds that the agency invoked when it took the action. The Federal Circuit said its review
of a patentability determination is confined to the grounds upon which the Board actually relied. Contrary to the PTO’s characterization of the Board’s decision, it did not rest on a finding that there were only two ways to modify Parthasarathy using Rose or suggest that these modifications would have been obvious to try. Indeed, although the Board concluded
that modifying Parthasarathy’s threshold to take into account query length would have been obvious. Entirely absent from its decision is any discussion of how such a modification would be accomplished. Certainly, the Board did not discuss or suggest the specific modifications the PTO advances on appeal. In the absence of any specific findings by the Board on these matters, we may not adopt the PTO’s fact-based arguments in the first instance on appeal.

The Federal Circuit concluded that the Board’s expressed reasoning cannot sustain its rejection of claims 1, 3–10, 12–19, and 21–27 and therefore vacate the Board’s

Corroboration of Reduction to Practice Supported Under the Rule of Reason, Supported by Substantial Evidence.

In Dionex Softron GmbH v Agilent Technologies, Inc., [2021-2372] (January 6, 2023), the Federal Circuit affirmed the PTAB decision awarding priority to Agilent in an interference.

In the interference, the Board identified Dionex as the senior party and Agilent as the junior party, thereby requiring that Agilent prove priority by a preponderance of the evidence.

In its analysis, the Board applied the rule of reason and found that the testimony of Wolfgang Kretz, one of Agilent’s two co-inventors, was sufficiently corroborated by
two of his co-workers, Manfred Berndt and Martin Bäuerle, who had worked near Kretz during the relevant time. Berndt and Bäuerle testified that Kretz successfully tested
a prototype encompassing all limitations of the count by June 1, 2007.

Based on the foregoing, the Board entered judgment on priority for Agilent and against Dionex and refused Dionex’s claims. Dionex timely appealed.

The Federal Circuit said that the Board properly treated Agilent’s specification as
the “originating specification” for purposes of construing the disputed claim terms and evaluating the sufficiency of written description support for the claims. When a party
challenges written description support for an interference count or the copied claim in an interference, the originating disclosure provides the meaning of the pertinent claim language.

The Federal Circuit said that the Board did not err in concluding that Agilent’s specification provided adequate written description support. Dionex’s arguments on this point depend entirely on our adopting Dionex’s proposed claim construction. In other words, Dionex contends there is not adequate written description support for its ordered steps construction of the claim, but we have rejected this proposed construction. Since the Federal Circuit affirmed the Board’s claim construction, Dionex’s written description arguments necessarily failed.

The Board did not err in awarding priority to Agilent. Substantial evidence supports the Board’s findings that Agilent’s actual reduction to practice was sufficiently corroborated
and occurred prior to Dionex’s earliest conception date. The Board’s finding of corroboration, under the rule of reason, is supported by substantial evidence.

Happy New Year 2023

Best wishes for a happy and prosperous 2023, full of great new ideas and no infringements!

U.S. Patent No.1,539.895 issued to George Buzza on June 2, 1995, on a “Game Device.”

George Buzza’s invention, featured above, was a game device that provided blocks, “preferably two in number, which have imprinted on the faces thereof words which are so devised that when the blocks are thrown , the words carried by the faces which come uppermost on the different blocks, when read in proper sequence, may combine to spell expressions indicative of various greetings.” George applied for a patent on his idea in 1923, and less than two years later his U.S. Patent No. 1,539,895 issued.

What idea do you have “rolling” around in your head, that you should finally do something with in 2023?