Microsoft Corporation v. Biscotti, Inc.

Docket Nos. 2016-2080, -2082, -2083 (IPR2014-01457, -01458, -01459)

December 28, 2017

Brief summary: PTAB decision following IPR that MSFT failed to show by a preponderance of the evidence that the challenged claims were anticipated or obvious affirmed.

Summary: MSFT appealed PTAB decision following IPR for US 8,144,182 related to video communications systems (e.g., claim 6 directed to “[a] method of providing video calling” using a combination of devices and steps) that it failed to show by a preponderance of the evidence that the challenged claims were anticipated or obvious in view of “Keynoyer” (US 7,907,164). After Biscotti filed suit in DC against MSFT for infringement of its ‘182 patent, MSFT filed three separate IPRs, the first two being focused on independent claim 6 and its dependents, and the third IPR being focused on claim 69 and its dependents, alleging anticipation and/or obviousness. The PTAB disagreed. The FC panel first explained its view that MSFT had challenged the FC’s standard of review on anticipation (i.e., it should be de novo), but also noted MSFT had “retreated from challenging our standard of review” and “acknowledged that anticipation is a factual question that this court reviews for substantial evidence” (Kennametal, FC 2015; Key Pharm., FC 1998; Anderson, US 1985; Lavender, US 1946). The FC panel also explained that “a patent is invalid as anticipated if ‘the invention was described in’ a patent or published application ‘before the invention by’ the patentee” (§ 102(e); “a prior art reference must ‘disclose all elements of the claim’…arranged as in the claim’” explicitly (Net MoneyIN, FC 2008) or such that “a person of skill in the art…would ‘at once envisage’ the claimed arrangement or combination” (Kennametal)). MSFT argued the PTAB “applied an ‘unduly narrow anticipation standard’” but the FC panel disagreed (e.g., the PTAB “did not require word-for-word similarity or perfection” and “explicitly considered whether a POSA would ‘at once envisage’ the combination”). On the substantive question of whether Keynoyer anticipated the claims, the FC panel found that MSFT’s “arguments are not unreasonable” but that “the material in the disclosure lends itself to more than one reasonable interpretation” and that the PTAB’s finding of no anticipation of claim 6 to be “supported by substantial evidence.” Regarding claim 69, the FC panel noted that MSFT’s “contains substantial new arguments” that it “needed to include…in the petition to institute” (§ 42.104(b)(5)), and that “it never sought permission to present them to the Board during the course of IPR” (Redline Detection, FC 2015). The FC panel also found that the PTAB’s decision that the arguments actually presented to it regarding claim 69 is “supported by substantial evidence, and any supplemental argument…has been waived.” MSFT also argued the PTAB “did not use the broadest reasonable interpretation” (BRI) “of the term ‘set-top box’” and that this was “prejudicial to its anticipation case”. MSFT “contend[ed] [its] broad definition” is as the term is as “defined in the ‘182 patent” and “includes televisions and computers” with “decryption and/or decoding functionality”. But the FC panel disagreed, finding that MSFT “provide[d] no explanation as to how a POSA would understand the computer in Kenoyer to be a set-top box with the special functionality required by [MSFT’s] definition.” The PTAB’s obviousness findings were also affirmed “[b]ecause [MSFT] does not argue separately that the Board erred in its obviousness analysis.” Judge Newman disagreed in the dissent (“These claims recite no new components or functions or technology….”)

This entry was posted in Anticipation (35 USC 102), Claim Construction, Inter Parties Review (IPR), IPR. Bookmark the permalink.

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