Takeaway: The Board may ignore a new argument in a request for rehearing that a previously asserted prior art reference can provide evidence of the level of ordinary skill in the art as part of an argument for unpatentability of a claim.  

In its Decision, the Board granted Petitioner’s Request for Rehearing of claims 4 and 9, but denied the Request for Rehearing for claims 3, 5, and 8 of the ’946 patent.

In its Final Decision, the Board concluded that Petitioner had demonstrated that claims 1, 2, 6, 7, and 10-17 of the ’946 are unpatentable, but Petitioner had not demonstrated that claims 3-5, 8, and 9 of the ’946 patent are unpatentable. Petitioner requested a rehearing and Patent Owner opposed the Request. Petitioner had challenged claims 1-17 of the ’946 patent based on the following obviousness grounds: (1) claims 1-3, 6-8, 15, and 16 in view of Lekernel and Padilla, (2) claims 4 and 9 in view of Lekernel, Padilla, and Odagiri, (3) claims 5, 10-14, and 17 in view of Lekernel, Padilla, and Wallner, (4) claims 1-3, 5-8, and 10-17 in view of Tang and BPS, and (5) claims 4 and 9 in view of Tang, BPS, and Odagiri.

Petitioner argued that the Board overlooked or misapprehended Petitioner’s discussion of the housing feature in Odagiri as applied to claims 4 and 9 of the ’946 patent. Petitioner asserted that the Board incorrectly determined that Petitioner did not rely on Odagiri to teach the housing limitation in addition to the limitations of claims 4 and 9. Patent Owner contended that Petitioner never argued that Odagiri teaches the housing limitation. The Board agreed with Petitioner and admitted that it overlooked this part of Petitioner’s argument.

Next, the Board analyzed claims 4 and 9 with the understanding that Odagiri teaches the housing limitation. Patent Owner argued that Petitioner has not shown that a person of ordinary skill in the art would have combined the housing of Odagiri to enclose the read head and said one or more resistors taught by the other references. The Board noted that the Petitioner explains that the combination would have been obvious because it is simply a design choice that has been made in a variety of related contexts for the benefit of reducing the number and cost of physical components, eliminating signal degradation, and increasing portability. Further, the Board stated that Patent Owner had not provided any evidence that deciding where and how the electronic components are housed in the claimed subject matter was uniquely challenging or difficult for one of ordinary skill in the art. Thus, the Board concluded that claims 4 and 9 are unpatentable based on the combination of Lekernel, Padilla, and Odagiri.

As for claim 5, the Board stated that the Request does not provide much discussion of claim 5’s alleged unpatentability and the Board was not persuaded that it had overlooked anything in the Petition.

Petitioner argued that claims 3 and 8 should be unpatentable because (1) an inventor of the ’946 patent admitted on record that housings for containing electronic components are well known, (2) during prosecution, it was represented that the housings are well known, and (3) the Board agreed that housings are well known. The Board stated that these arguments are not appropriate for a Request for Rehearing because they are not adequately explained. Petitioner also asserted that Odagiri independently discloses housings and that the Board is allowed under the statute to cancel claims 3 and 8. The Board stated that Petitioner had not pointed to any place on record where it had argued that Odagiri is evidence of the knowledge of the ordinary skilled artisans would have had when reading Lekernel and Padilla. Because the Board viewed Petitioner’s reliance on Odagiri for the level of ordinary skill as a new argument, it was not appropriate for a request for rehearing. Petitioner argued that even if the argument is new, the Board should wave the requirements of § 42.71(d) in the interests of justice. The Board declined to do so and noted that even if it were inclined to wave the rule, it did not institute review of claims 3 and 8 based on Lekernel and Padilla.

SQUARE, INC. v. REM HOLDINGS 3, LLC, IPR2014-00312

Paper 68: Request for Rehearing

Dated: November 20, 2015

Patent: 8,584,946

Before: Denise M. Pothier, Jennifer S. Bisk, and Patrick R. Scanlon

Written by: Bisk