Federal Circuit Summary

Before Dyk, Taranto, Stoll. Appeal from the Patent Trial and Appeal Board.

Summary: The PTAB is not required to make any finding regarding a motivation to combine two references when it concludes that a claim is invalid under § 103 in view of a single prior art reference.

Hewlett Packard (“HP”) sought inter partes review of a patent owned by Realtime Data, LLC. The patent at issue described a system and method for lossless data compression using dictionary encoding. HP alleged that the claims were obvious over a U.S. patent (“O’Brien”) in view of Nelson, a data compression textbook. HP argued that O’Brien disclosed all claim elements. Further, although O’Brien did not use the claim term “dictionary,” HP relied on Nelson to explain that a person of ordinary skill in the art would have recognized that the algorithm disclosed in O’Brien is a dictionary algorithm. The Board held that the claims would have been unpatentable under § 103 over O’Brien alone or alternatively, in further view of Nelson. Realtime appealed on two grounds: (1) that the Board erred in its determination that a person of ordinary skill would have been motivated to combine the teachings of O’Brien and Nelson, and (2) that the Board erred by failing to construe the “maintaining the dictionary” limitation and in finding that O’Brien disclosed the limitation.

The Federal Circuit affirmed the Board’s findings. First, the Board had no obligation to find a motivation to combine the two references because the Board did not rely on Nelson for the disclosure of a particular element or teaching, instead finding that O’Brien alone disclosed all claim elements. HP’s primary argument relied on Nelson merely to explain that O’Brien’s algorithm was a dictionary algorithm, which Realtime conceded was correct. The Federal Circuit also rejected Realtime’s proposed construction of “maintaining the dictionary,” which attempted to add unstated elements to the claim term.