PTAB Claim Analysis Can Serve as Persuasive Authority

Inter Partes Review (IPR), Post-Grant Review (PGR) and Covered Business Method (CBM) proceedings of the Patent Trial & Appeal Board (PTAB) begin with a Trial Order that includes substantial guidance on matters of claim construction. Typically, key terms at issue in the proceeding are expressly construed by the panel of administrative patent judges (APJs). While such constructions are not binding on a parallel litigation proceeding due to the use of a different claim construction rubric by the USPTO, in some circumstances such findings can be devastating to a litigation campaign — well in advance of the typical Markman Order. 

For example, in many cases involving non-practicing entities (NPE), an overly broad claim construction is advanced for the purpose of capturing the products/processes of an entire industry. At the PTAB, the broadest reasonable interpretation is applied. Naturally, if the PTAB does not agree with the NPEs claim interpretation (some 5-6 months after petition filing), such is strong evidence that the plaintiff's claim scope is over-reaching. In fact, the CAFC has found the USPTO's "broadest reasonable interpretation" to be persuasive evidence in this regardSee St. Clair Intellectual Property Consultants, Inc. v. Canon Inc., (Fed. Cir. 2011, non-precedential)

In other contexts, such as ascertaining the proper support for a claim term under 35 U.S.C § 112, the analysis of the PTAB's technically trained judges can amplify perceived ambiguities. 

Yesterday, the CAFC leveraged the PTAB's 112 analysis on subjective claim terminology in Interval Licensing LLC v. AOL, Inc. (Fed. Cir. 2014) (here). In Interval, the Court reviewed the specification of the subject patent for support for the claim terminology "in an unobtrusive manner."  The patentee argued that a wallpaper embodiment of the specification provided the objective boundaries of the subjective scope, but that a screensaver embodiment should be excluded from the analysis. In reviewing this issue the Court pointed to a concurrent patent reexamination record and a statement made during an oral hearing at the PTAB.

The statements of Interval, and the responses of the USPTO, reflect considerable uncertainty about which embodiments were tied to the "unobtrusive manner" language. . . .[I]n a recent decision addressing the scope and validity of the '314 patent, the Patent Trial and Appeal Board . . .concluded that, in light of "the ambiguous nature" of the specification, "the claim term 'unobtrusive manner' includes the screensaver embodiment."After reviewing the specification and prosecution history, we find that the "unobtrusive manner" phrase has too uncertain a relationship to the patents' embodiments.

In a footnote, the CAFC cited to the transcript of the PTAB oral argument. 

At the hearing before the Board, counsel for Interval acknowledged the lack of clarity in column 3 of the specification: "I would say in this summary location within the specification [the drafters] were a little bit less precise, a little bit sloppy here . . . it might seem less precise or even possibly contradictory. . . . My point is simply that at best it's ambiguous."

In the hearing explanation noted above, patentee was hoping to divorce the language of column 3 from the analysis by labeling it as ambiguous (since it arguably showed a connection to the screensaver embodiment). The patentee also cancelled claims that seemed to also show a connection to the screensaver embodiment. (Note: 112 was not at issue in the patent reexamination directly,support was analyzed only as it related to claim interpretation)

Interestingly, the Courts apply the more forgiving Nautilus standard for 112 as opposed to that pronounced in Ex parte Miyazaki and, more recently In re Packard (CAFC 2014) for the USPTO. Had the terminology not been subjective (i.e., requiring objective boundaries for the recited standard of degree), and the question just whether one or both of the screensaver or wallpaper embodiments were covered by the claim, the CAFC may have found that degree of ambiguity still "reasonably certain." On the other hand, under Packard, a standard that favors amendment, the PTAB would have found such different interpretations as failing to "particularly point out and distinctly claim" the invention— but, that disparity in 112 standards is left for a PGR or CBM decision to come.

Many perceive the value of PTAB filings solely as a vehicle to stay a parallel court proceeding. Cases like Interval prove that view to be especially short-sighted.