Takeaway: To prove nexus between an allegedly commercially successful product and a claimed invention, a patent owner relying upon infringement claim charts in a related litigation should provide explanation as to the context of the litigation, such as whether infringement was established or whether the accused infringer agreed to the charge of infringement.
In its Final Written Decision, the Board found that Petitioner had shown by a preponderance of the evidence that claim 13 of the ’077 patent is unpatentable. The ’077 patent “relates to a remote control that includes an input with a set of keys or push buttons for inputting commands into the remote control, infrared (IR) signal output circuitry for supplying an infrared signal to a controlled device, and a central processing unit (CPU) coupled to the input and to the signal output circuitry.” The sole instituted ground was alleged obviousness of claim 13 over Ciarcia and Hastreiter.
The Board first addressed Patent Owner’s contention that Petitioner failed to properly identify all real parties-in-interest. Patent Owner argued that Ohsung, “a supplier of products to [Petitioner],” should have been named because “Ohsung exercised or could have exercised control over Petitioner’s participation in this proceeding based on the close relationship between Petitioner and Ohsung.” The Board was not persuaded by Patent Owner’s arguments. In particular, sharing one employee or paying for an employee’s office space did not evidence control over Petitioner in this proceeding. Further, a settlement agreement between Petitioner and Patent Owner, in which Ohsung was obligated to pay royalties to Patent Owner, did not exemplify a “close relationship in 2014 when the Petition in this proceeding was filed,” and was “directed to a set of patents, none of which is the patent involved in this proceeding.” Finally, the Board was not persuaded that sharing litigation counsel in a related case exhibited control.
Turning to claim construction, the Board noted that because the ’077 patent had expired, interpretation of the claims is similar to that in district court. Petitioner proposed constructions for several means-plus-function terms, and Patent Owner provided its own interpretation for those terms. However, the Board determined that no explicit construction was necessary for those terms. The only term the Board construed was “code data,” which the parties agreed included “timing information or data,” but did not agree whether it included “instructions.” The Board concluded that “code data” includes “timing information or data, but need not include instructions,” agreeing with Petitioner’s proposal as consistent with the specification.
The Board then addressed the alleged obviousness of claim 13 over Ciarcia and Hastreiter. Patent Owner argued that the prior art does not meet the “code data” limitation; that “there is insufficient reason to combine Ciarcia and Hastreiter”; and that secondary considerations establish nonobviousness. The Board was not persuaded by Patent Owner’s argument regarding “code data” because it did not adopt Patent Owner’s proposed claim construction for the limitation.
As to the motivation to combine the references, the Board found Patent Owner’s arguments unpersuasive. In particular, the Board was persuaded that the references constituted analogous art, finding that Patent Owner’s arguments were not persuasive under the relevant test. To determine whether a prior art reference constitutes analogous art, the test is “(1) whether the prior art is from the same field of endeavor, regardless of the problem addressed, and (2) if the reference is not within the field of the inventor’s endeavor, whether the reference still is reasonably pertinent to the particular problem with which the inventor is involved.” The Board found Patent Owner had not explained why “Hastreiter is from a field of endeavor different from that of the claimed invention,” and that the second prong of the test had not been addressed.
The Board also found Patent Owner’s arguments regarding Hastreiter’s alleged teaching away to be unpersuasive. In particular, Patent Owner argued that the complexity of the Hastreiter apparatus would teach away from the proposed combination because the Ciarcia remote “only has six keys, such that minimizing interconnections would not be a concern.” The Board disagreed, finding that Patent Owner’s arguments and evidence was not consistent with the disclosure of Hastreiter.
Patent Owner had alleged that commercial success of the patented product established nonobviousness. Patent Owner argued that “several of the patents owned by Patent Owner, including the ’077 patent, were licensed by a substantial portion of the industry, showing commercial acquiescence and competitor acceptance of Patent Owner’s licensed patents.” However, the Board noted that the “mere existence of several licenses, without more specific information about the circumstances surrounding the licensing, is not a good indicator of nonobviousness.” In this case, the Board stated that Patent Owner did not provide evidence, for example, regarding whether decisions to take a license were “from acknowledged merits of the claimed invention” and “how many entities refused to take a license or why some entities, if any, refused to take a license.”
Patent Owner had argued that its own products and those of its licensees (including Logitech) “have enjoyed tremendous commercial worldwide success.” However, the Board found that “Patent Owner does not describe for [the Board] the components or manner of operation of the products sold by it or Logitech.” Patent Owner relied upon infringement claim charts prepared for litigation, but the Board found such charts insufficient to establish nexus between the alleged commercial success and the claimed invention. According to the Board, no explanation as to the “context of the litigation” was provided, for example, “whether Logitech agreed to the charge of infringement.” Thus, the Board found that Patent Owner did not establish that the claim charts were “meritorious insofar as showing a nexus is concerned.” Moreover, the Board was not persuaded that the alleged $100 million of Logitech sales or $1 billion of Patent Owner’s sales constituted commercial success because no market share information was provided. According to the Board, “[i]t is well established that absolute sales numbers without market share data does not establish commercial success.” Finally, the Board found that Patent Owner did not provide sufficient evidence regarding the reasons for the alleged commercial success, and thus, did not establish the sales to be “a direct result of the unique characteristics of the invention, and not a result of economic and commercial factors unrelated to the quality of the patent subject matter.”
Thus, the Board found that Petitioner established unpatentability of claim 13 by a preponderance of the evidence.
The Board next addressed the parties’ Motions to Exclude Evidence. Patent Owner’s Motion was dismissed because the Board did not rely upon the evidence subject to the Motion. The Board also dismissed Petitioner’s Motion because the parties did not rely upon any of the objected to evidence in the proceeding, and neither did the Board.
Finally, the Board addressed the parties’ unopposed Motions to Seal, granting them both. The Board noted that in reaching its decision, no confidential information was identified or discussed in detail.
Universal Remote Control, Inc. v. Universal Electronics, Inc., IPR2014-01102
Paper 50: Final Written Decision
Dated: December 15, 2015
Before: Howard B. Blankenship, Sally C. Medley, and Lynne E. Pettigrew
Written by: Pettigrew
Related Proceedings: Universal Electronics, Inc. v. Universal Remote Control, Inc., No. SACV 13-00984-AG-JPR (C.D. Cal.); IPR2014-01103; IPR2014-01104; IPR2014-01106