The patentee in two inter partes reviews (IPRs) appealed decisions by the Patent Trial and Appeal Board (PTAB), arguing that “it did not receive adequate notice of or opportunity to address” the portion of a prior art reference that the PTAB relied on to cancel the patent’s claims. The Federal Circuit affirmed in part and vacated in part.

In the first IPR, the petition cited one of the figures as a relevant portion of the reference, giving the patentee “an adequate opportunity to respond.” In the second IPR, however, the petitioner did not cite that figure until its reply to the patentee’s response. The patentee objected and “requested leave to file motions to strike or, alternatively, surreplies, which the PTAB denied.” The patentee was also not allowed to address the issue at oral hearing. The PTAB, in its final decision, ultimately “relied heavily” on the cited relevant portion of the reference.

The Administrative Procedure Act (APA) protects “against loss of patent rights without the required notice and opportunity to respond.” “Although the [PTAB] is not limited to citing only portions of the prior art specifically drawn to its attention,” here “the [PTAB] treated [the portion cited in reply] as an essential part of its obviousness findings identifying claim elements in the prior art.” The portion did not merely “describe the state of the art” or “inform[] the understanding of another, separate prior art disclosure.” Thus, the court held that the PTAB’s “refusal to allow [the patentee] to respond fully once that material was called out, violated [the patentee’s] rights under the APA” such that a remand for further proceedings was necessary.