Softview LLC v. Apple Inc.

Court of Appeals for the Federal Circuit·Decided July 26, 2024·No. 23-1005·Published

Opinion

Case: 23-1005 Document: 73 Page: 1 Filed: 07/26/2024

United States Court of Appeals for the Federal Circuit ______________________

SOFTVIEW LLC, Appellant

v.

APPLE INC., MOTOROLA MOBILITY LLC, Appellees

KATHERINE K. VIDAL, UNDER SECRETARY OF COMMERCE FOR INTELLECTUAL PROPERTY AND DIRECTOR OF THE UNITED STATES PATENT AND TRADEMARK OFFICE, Intervenor ______________________

2023-1005, 2023-1007 ______________________

Appeals from the United States Patent and Trademark Office, Patent Trial and Appeal Board in Nos. 95/000,634, 95/002,132. ______________________

Decided: July 26, 2024 ______________________

ALAN BURNETT, Law Office of R. Alan Burnett, Belle- vue, WA, argued for appellant.

SONAL NARESH MEHTA, Wilmer Cutler Pickering Hale and Dorr LLP, Palo Alto, CA, argued for all appellees. Motorola Mobility LLC also represented by MADELEINE C. Case: 23-1005 Document: 73 Page: 2 Filed: 07/26/2024

LAUPHEIMER, Boston, MA; JOHN C. ALEMANNI, Kilpatrick Townsend & Stockton LLP, Raleigh, NC; DAVID A. REED, Atlanta, GA.

EDMUND HIRSCHFELD, Orrick, Herrington & Sutcliffe LLP, New York, NY, for appellee Apple Inc. Also repre- sented by MELANIE L. BOSTWICK, Washington, DC; MARK S. DAVIES, White & Case LLP, Washington, DC; JAMES P. MURPHY, Polsinelli PC, Houston, TX.

FARHEENA YASMEEN RASHEED, Office of the Solicitor, United States Patent and Trademark Office, Alexandria, VA, argued for intervenor. Also represented by PETER J. AYERS, MICHAEL S. FORMAN. ______________________

Before LOURIE, BRYSON, and REYNA, Circuit Judges. BRYSON, Circuit Judge. Appellant SoftView LLC appeals from a decision of the Patent Trial and Appeal Board in two inter partes reexam- ination proceedings. Based on a prior decision in an inter partes review (“IPR”) proceeding, the Board held all claims of SoftView’s U.S. Patent No. 7,461,353 (“the ’353 patent”) invalid under the estoppel provision set forth in 37 C.F.R. § 42.73(d)(3)(i). SoftView challenges the Board’s application of section 42.73(d)(3)(i) on various grounds. First, SoftView contends that the PTO improperly interpreted the regulation in a manner that gave it broader scope than the common law rule of collateral estoppel. Second, SoftView argues that the Patent and Trademark Office (“PTO”) lacks statutory authority to promulgate a regulation governing the estop- pel effect of IPR decisions in subsequent proceedings before the PTO. Third, SoftView maintains that the regulation by its terms does not apply to claims that have already issued. Case: 23-1005 Document: 73 Page: 3 Filed: 07/26/2024

SOFTVIEW LLC v. APPLE INC. 3

We uphold the validity of the regulation and the estop- pel standard adopted in the regulation. With respect to the scope of the regulation, however, we agree with SoftView that the regulation applies to new claims or amended claims, but not to previously issued claims. I 1. The Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112–29, 125 Stat. 284 (2011), established the IPR process and gave the PTO rulemaking authority to imple- ment it. Specifically, Congress instructed the Director of the PTO to prescribe regulations “governing inter partes review . . . and the relationship of such review to other pro- ceedings under this title.” 35 U.S.C. § 316(a)(4). Pursuant to its authority under section 316(a)(4), the PTO promulgated rules governing the procedures to be fol- lowed in IPR proceedings. Among those rules was the rule codified at 37 C.F.R. § 42.73(d)(3), which addressed the op- eration of estoppel principles in patent office proceedings. That rule prohibits a patent owner from “taking action inconsistent with the adverse judgment” in various pro- ceedings, including IPR proceedings. As the PTO ex- plained when the regulation was issued, section 42.73(d)(3) applies to judgments in “derivation proceedings, inter partes review, post-grant review, and covered business method review.” Rules of Practice for Trials Before the Pa- tent Trial and Appeal Board and Judicial Review of Patent Trial and Appeal Board Decisions (“Rules of Practice II”), 77 Fed. Reg. 48612, 48649 (Aug. 14, 2012). In particular, the regulation prohibits a patent owner from “obtaining in any patent: (i) A claim that is not patentably distinct from a finally refused or canceled claim.” 2. The ’353 patent is directed to displaying internet content on mobile devices. Various phone manufacturers have challenged the validity of the ’353 patent in proceed- ings before the PTO. In 2011, Apple filed a request for inter Case: 23-1005 Document: 73 Page: 4 Filed: 07/26/2024

partes reexamination of the ’353 patent. Proceeding No. 95/000,634. Over the next two years, Apple filed a separate request for ex parte reexamination of the ’353 patent, pro- ceeding No. 90/009,994, and Motorola also filed a request for inter partes reexamination of the ’353 patent, proceed- ing No. 95/002,132. On October 12, 2012, Kyocera filed a petition for inter partes review of 18 of the 319 claims of the ’353 patent, proceeding No. IPR2013-00007. The Board stayed all of the reexamination proceedings pending the outcome of the IPR proceeding. On March 27, 2014, the Board issued a final written decision in the IPR proceeding, finding each of the 18 chal- lenged claims of the ’353 patent unpatentable. This court summarily affirmed. SoftView LLC v. Kyocera Corp., 592 F. App’x 947 (Fed. Cir. 2015). The IPR certificate issued on January 12, 2016, canceling the challenged claims. 3. The stay of the ex parte and inter partes reexamina- tion proceedings challenging the remaining claims of the ’353 patent was lifted on November 27, 2015. In ex parte reexamination No. 90/009,994, SoftView amended various claims of the patent, which were then deemed patentable over the prior art. There are 107 such amended claims. 1 To the extent they differ more than trivially from the canceled claims, the amended claims merely combine limi- tations from multiple canceled claims. For example, origi- nal claims 1, 118, and 138 (which depends from claim 118)

1 The amended claims are claims 5, 23–27, 60–61, 122, 137, 140–41, 147, 156, 174–77, 238–42, 248, 259, and 274–77, as well as the claims that depend from those di- rectly amended, which are claims 9, 12–14, 16–17, 19–21, 71–83, 85, 86, 88–111, 126, 129, 130, 132, 134, 135, 162– 64, 166–67, 215, 226–36, 245–47, 251, 265, 266, 268, and 270–71. This list includes some claims that are not on ap- peal. Case: 23-1005 Document: 73 Page: 5 Filed: 07/26/2024

SOFTVIEW LLC v. APPLE INC. 5

were all found invalid in the IPR. Amended claim 5 com- bines the device of claim 1 together with the method of claim 118/138, with only immaterial differences in phras- ing. Compare ’353 patent, Ex Parte Reexamination Certif- icate at col. 1, line 31, to col. 2, line 10 (amended claim 5) with ’353 patent at col. 22, ll.15–43 (canceled claim 1) and id. at col. 34, ll. 6–19 (canceled claim 138). In the inter partes reexaminations, the examiner found the overwhelming majority of claims unpatentable over the prior art under 35 U.S.C. § 103. On appeal, the Board re- versed the examiner’s obviousness rejections on the ground that there was “insufficient articulated reasoning to sup- port the Examiner’s final conclusion that the claims would have been obvious to one of ordinary skill in the art at the time of Appellant’s invention.” J.A. 69. The Board, how- ever, entered a new ground of rejection as to all pending claims based on 37 C.F.R.

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