Claims can be invalidated for reasons first articulated in rebuttal to a Patent Owner’s arguments in an IPR

Idemitsu Kosan Co. v. SFC Co., (Fed. Cir. Sep. 15, 2017) (Before Prost, C.J., O’Malley, and Chen, J.) (Opinion for the court, O’Malley, J.)

The Federal Circuit affirmed the Board’s decision to invalidate as obvious certain patent claims directed to a device that emits light when electric current is passed through a particular organic medium.

SFC petitioned for inter partes review of all claims in a patent owned by Idemitsu. The Board instituted review on a single ground: whether certain claims were obvious over Arakane, an international publication that is also assigned to Idemitsu. The Board ultimately held that all instituted claims were obvious because (1) Arakane discloses HT and ET compounds corresponding to those recited by the claims and (2) Arakane teaches that a light emitting layer can be formed by combining HT and ET compounds.

On appeal, Idemitsu argued that the Board erred in finding that Arakane teaches combining the compounds to create a light emitting layer in an electroluminescent device. Instead, Arakane requires that, when combined in a layer, the HT and ET compounds must be selected such that the energy gap of the HT compound is smaller than the energy gap of the ET compound. The Board made no findings regarding such a relationship. Idemitsu thus argued that the Board made one of two erroneous assumptions: “either (1) a skilled artisan would have expected that all disclosed HT compounds in Arakane have a lower energy gap than all disclosed ET compounds; or (2) Arakane suggests combinations of HT and ET compounds that do not satisfy the energy gap relation in addition to combinations that do.”

The Court found that “the Board plainly did not make the first assumption.” The independent claims do not include any limitations directed to the energy gap relationship. Thus, the Board found that “the ‘claimed invention as a whole’ is the combination of the recited components in a light emitting layer.” Arakane teaches that this combination will produce a light emitting layer.

Regarding the second assumption, the Court found no error in the Board’s finding that “Arakane suggests combinations of HT and ET compounds that produce a light emitting layer, regardless of their energy gap relation.” Procedurally, Idemitsu argued that this issue was “raised too late” because it did not appear in the petition or institution decision. The Board rejected this contention, saying that the “back-and-forth” of arguments “is simply the by-product of one party necessarily getting the last word,” and if anything, SFC simply countered Idemitsu’s argument in its reply that Arakane teaches away from non-energy-gap combinations.

Idemitsu also argued that the Board should not have decided whether combinations of HT and ET compounds produce a light emitting layer, without additional extrinsic evidence, such as expert testimony. The Court agreed that, in some cases, such an approach could be problematic, but here, Idemitsu provided no supporting extrinsic evidence. Although SFC bore the burden of establishing unpatentability, “it is not required as a matter of law to rebut mere attorney argument with expert testimony in order to satisfy that burden.” Thus, the Court found that the Board did “precisely what [it] is supposed to do” when it weighed the parties’ competing arguments, each relying solely on the text of Arakane, and found SFC’s interpretation to be more plausible. Further, the Court found that to the extent Arakane does teach away from the invention, “it is undisputed that the claims at issue do not include limitations” directed to overcome the drawbacks supposedly taught by Arakane. The Court also found this conclusion to be supported by Arakane’s abstract and specification, which teach “that a light-producing device can be made—regardless of comparative shortcomings in durability or resistance caused by imperfect energy gap ratio—by combining HT and ET compounds.”

During inter partes review, it is possible for claims to be invalidated for reasons first articulated in rebuttal to a Patent Owner’s arguments. Patent owners should anticipate a petitioner’s counterarguments to its positions, including those made in Patent Owner’s Reply. Further, features of the invention that are alleged to distinguish over the prior art may not carry sufficient weight if they are not recited in the claims.

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  1. Paul F. Morgan September 26, 2017 1:10 pm

    Note that this does not support bringing in a new prior art reference at this stage.

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