CAFC Vacates PTAB Ruling for Patent Owner in Google IPR

The U.S. Court of Appeals for the Federal Circuit (CAFC) issued a decision Monday in Google LLC v. Parus Holdings, Inc., vacating a Patent Trial and Appeal Board (PTAB) final written decision that upheld two claims of a voice browsing patent owned by Parus Holdings, Inc. The court found that the Board made multiple errors under the Administrative Procedure Act (APA) in rejecting Google’s obviousness challenge and remanded the case for further proceedings.

Parus owns the U.S. Patent No. 6,721,705, titled “Robust Voice Browser System and Voice Activated Device Controller,” as well as two related patents descended from it, the 7,881,941 and 8,185,402 patents. The ‘705 patent describes a system that lets users control a web browser by telephone using voice commands. It organizes websites into ranked categories and periodically updates those rankings through a polling mechanism that checks each site.

Google petitioned the U.S. Patent and Trademark Office (USPTO) for inter partes review (IPR) of claims 1 and 2 of the ‘705 patent, arguing they would have been obvious over two combinations of prior art, Kovatch combined with Burrows and Wise combined with Burrows. Google separately obtained IPRs of the ‘941 and ‘402 patents using similar combinations, and the Board found those claims unpatentable in August 2023. For the ‘705 patent, however, the Board reached the opposite conclusion in its August 2024 final written decision. It determined that Google failed to prove obviousness for claim limitations governing how the system decreases a website’s ranking when a site fails to respond, provides an unexpected response, or responds more slowly than another site. The Board also found Google had not established obviousness for a separate limitation concerning the ranking of websites under the Wise-Burrows combination.

Google appealed, and the CAFC identified three separate problems with the Board’s analysis. First, the court agreed with Google that the Board evaluated the Burrows reference in isolation rather than considering how a relevant artisan would have combined its teachings with Kovatch or Wise. According to the opinion, the Board repeatedly asked whether Burrows itself disclosed the challenged ranking adjustments, rather than whether the combination as presented in Google’s petition would have rendered those adjustments obvious. Citing its own precedent, the CAFC explained that “references in an obviousness combination must be read together, not in isolation when, as here, the particular combination argued by the petitioner calls for such a reading.”

Moreover, the court held that the Board construed the claim term “unexpected response” without giving Google notice of or an opportunity to address that construction. The Board had relied on the patent’s preferred embodiment and outside evidence regarding how frequently webpages change to conclude that a modified webpage could not, by itself, qualify as an unexpected response. The CAFC determined this reasoning restricted the scope of the claim term and so constituted claim construction. Since the parties had not previously disputed the meaning of the term, the CAFC found the Board’s approach was short on the APA requirement that “a petitioner is entitled to respond to a new claim construction.”

The CAFC also found that, with respect to the Wise-Burrows combination, the Board failed to address one of Google’s key arguments. Specifically, Google argued that upholding the ‘705 patent claims was inconsistent with the Board’s earlier decisions in the ‘941 and ‘402 IPRs, where it had found related claims obvious based on overlapping prior art and similar reasoning. Google raised the inconsistency in its reply brief and again at oral argument before the Board, but the final written decision did not mention or distinguish the earlier rulings. The CAFC stated that an agency’s silence on a squarely raised inconsistency argument can preclude adequate appellate review, since it becomes impossible to determine whether the Board recognized the conflict and, if so, why it reached a different result.

The CAFC reviewed the Board’s decision under the standards set by the APA, which require setting aside “findings that are arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” Applying that standard, the court concluded the errors were not harmless and required vacatur as to both prior art grounds.

On remand, the CAFC directed the Board to reconsider the Kovatch-Burrows and Wise-Burrows combinations with focus on how a relevant artisan would have combined the references, rather than analyzing Burrows alone. The Board was also directed to provide Google an opportunity to address the construction of “unexpected response” before applying it. The CAFC instructed the Board that, if it again determines the Wise-Burrows ground does not establish unpatentability, it must expressly address Google’s inconsistency argument. The Board must explain why this case differs from the earlier IPRs or otherwise justify reaching a different result.

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Copyright: William Perry