CAFC Affirms Google’s PTAB Invalidation of Voice Recognition Patent Claims

Parus Holdings, Inc. was unsuccessful today in its bid to the U.S. Court of Appeals for the Federal Circuit (CAFC) to reverse two Patent Trial and Appeal Board (PTAB) decisions invalidating its patent claims for voice recognition technology. The CAFC in part said in a precedential decision authored by Judge Lourie that since Parus violated the U.S. Patent and Trademark Office’s (USPTO’s) regulation against arguments incorporated by reference, the PTAB did not have to consider evidence related to those arguments.

Parus argued on appeal that the Board’s refusal to consider evidence of antedating that would disqualify a disputed reference (Kovatch) as prior art amounted to “a) []a violation of the Administrative Procedure Act (APA), (b) improperly placed a burden of persuasion on the patent owner, and (c) conflicts with statutes and regulations governing IPRs.”

While Parus claimed the governing IPR statute requires only petitioners to provide “specific and persuasive attorney argument,” and that patent owners are not even required to file a response to petitions, the court said that, “here, Parus chose to take on an affirmative burden to show that it was the first to make its claimed inventions.” Once that burden was accepted, Parus was required to comply with all of the same regulations as the petitioner, the court added. “And that includes not incorporating material by reference pursuant to 37 C.F.R. § 42.6(a)(3) and the inclusion of ‘a detailed explanation of the significance of the evidence including material facts,” quoted the court.

Although the burden of persuasion is on the petitioner, “when a patent owner attempts to antedate an asserted prior art reference, the patent owner assumes a temporary burden of production,” said he court. The CAFC also recently reiterated this point in another precedential decision, Medtronic v. Teleflex.

The court also took issue with how Parus’s evidence was presented, chiding the patent owner for expecting too much from the Board. The opinion explained:

“The burden of production cannot be met simply by throwing mountains of evidence at the Board without explanation or identification of the relevant portions of that evidence. One cannot reasonably expect the Board to sift through hundreds of documents, thousands of pages, to find the relevant facts. As the Seventh Circuit articulated in United States v. Dunkel, 927 F.2d 955, 956 (7th Cir. 1991), ‘Judges are not like pigs, hunting for truffles buried in briefs.’”

The court further pointed to its own precedent in General Access Solutions, Ltd. v. Sprint Spectrum L.P, in which the patent owner “attempted to incorporate by

reference a lengthy claim chart allegedly evidencing conception of the challenged claims.” That opinion further explained how the rule against incorporation by reference furthers policy goals such as ensuring arguments aren’t overlooked and to minimize abuses. Allowing patent owners to submit evidence without briefing, no matter how voluminous, would also “eviscerate all page limits for patent owners while maintaining restrictions on petitioners,” wrote the court.

Parus also attempted to argue that Aqua Products v. Matal requires the Board to review “the entirety of the record,” but the CAFC called that argument “misplaced.” The court said:

“Aqua Products stands for the principle that the Board must decide all issues properly before it, even if they are contrary to its result. Nothing in Aqua Products mandates that the Board review evidence and issues introduced by a party in violation of its rules or not introduced at all.”

Parus had more than 3,000 unused words available in its patent owner response, the court said, but didn’t use them, and could have asked for more if needed. Since Parus did not challenge the obviousness rulings on any other grounds, the court thus affirmed the PTAB’s finding that the relevant claims of Parus’s U.S. Patent No. 7,076,431 were unpatentable as obvious.

Secondly, Parus argued the Board erred in finding the relevant claims of the ‘431 patent and U.S. Patent No. 9,451,084 were not sufficiently supported by written description to entitle them to an earlier priority date than the prior art reference raised by Google. Parus first said that the PTAB exceeded its authority by making determinations based on Section 112, rather than Sections 102 or 103, but Google argued that argument had been waived because it was only raised in its preliminary response, and the court agreed. The argument was also without merit even if it had not been waived, added the court, because “[a]s we decided in Arthrex, § 311(b) ‘merely dictates the grounds on which an IPR petition may be based, not the issues that the Board may consider to resolve those grounds.’”

As to Parus’s arguments that the Board erred in its findings on written description, the CAFC said that these “amount to a request for us to reweigh the evidence already considered by the Board, which we decline to do.” Since the court determined the Board’s findings were supported by substantial evidence, it affirmed.

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Author: AndreyPopov