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Federal Circuit Schedules Oral Hearing in First Appeal of Inter Partes Review

October 14, 2014
Post by Jonathan L. Kennedy

The Federal Circuit has scheduled oral arguments for the first appeal of an inter partes review ("IPR") decision by the Patent Trial and Appeal Board ("PTAB"). Oral arguments have beenscheduled for November 3, 2014. The appeal involves a number of interesting issues. First, it arises from the first IPR filed with the PTAB—Garmin USA, Inc. v. Cuozzo Speed Technologies, LLC (IPR2012-00001). In that IPR, the PTAB invalidated three claims (claims 10, 14, and 17) of U.S. Patent No.6,778,074. Second, pursuant to a settlement agreement, Garmin agreed not to take part in any appeal. Instead, once Cuozzo appealed the PTAB's decision, the Patent Office intervened under 35 USC § 143 to oppose Cuozzo's appeal, effectively taking Garmin's place.

Cuozzo appealed four issues from the PTAB decision, relating both to procedural and substantive matters: (1) "Whether the PTAB lacked authority to institute IPR for claims 10 and 14 on grounds of unpatentability not identified in the Petition"; (2) "Whether the B[roadest] R[easonable] I[nterpretation] standard applies to IPR, and whether the PTAB erred by construing the term 'integrally attached'"; (3) "Whether, if the PTAB had jurisdiction over claim 10, it erred in cancelling claim 10 as invalid under 35 U.S.C. § 103"; and (4) "Whether the PTAB erred in denying Cuozzo's motion to amend the claims."

The petition for IPR originally filed by Garmin alleged forty-three different grounds of invalidity based on a number of patents. The PTAB rejected forty-one of those grounds and chose to institute the IPR based on two grounds of invalidity alleged by Garmin against dependent claim 17. However, when instituting the IPR the PTAB applied those same two grounds of invalidity against claims 10 and 14, even though Garmin had not asserted those grounds against claims 10 or 14. In its final decision, the PTAB cancelled claims 10, 14, and 17 based on the two grounds Garmin had raised against claim 17. Whether the PTAB can expand the scope of its review by applying grounds of invalidity against claims in a manner not raised by the Petitioner is a significant question and clarity from the Federal Circuit is greatly anticipated.

Garmin's petition did not set forth any proposed claim constructions. Despite this, in instituting the IPR—without any input from either party—the PTAB chose to construe the claim term "integrally attached" based on the broadest reasonable interpretation standard. In its brief, Cuozzo argues this standard is improper for PTAB and only appropriate during examination and reexamination. Instead, Cuozzo argues that the PTAB should be held to the standards set forth in the Federal Circuit's Phillips' decision. The PTAB's construction of the term was pivotal in the other decisions in the IPR. For example, the PTAB denied Cuozzo's motion to amend claims during the IPR under 35 USC § 316(d) based on the construction of the term "integrally attached." Clarification regarding the claim construction standard that applies to the PTAB will be critical moving forward.


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