Federal Circuit Remands Reexaminations Based on Erroneous Claim Constructions

federal-circuit-flower-tree-squareIn re Varma v. IBM Corp., (In re Varma). (Fed. Cir. Mar. 10, 2016) (Before Wallach, Clevenger, and Taranto, J.) (Opinion for the court, Taranto, J.). Click Here for a copy of the opinion.

On March 10, 2016 the Federal Circuit sent two Patent Trial and Appeal Board (“PTAB” or “Board”) reexaminations back to the Patent Office.  In proceedings initiated by IBM and SAS Institute Inc., the PTAB rejected claims for analyzing investment data in two patents owned by InvestPic LLC. The Board’s ruling turned upon two claim terms: (1) a “bias parameter” that determines a degree of randomness in sample selection in a resampling process”; and (2) “a statistical analysis request corresponding to two or more selected investments.” The claims were held to be anticipated or obvious in light of a prior art reference describing a bootstrap method to gain better information about expected returns on an asset.  InvestPic appealed and focused its challenge on the Board’s claim construction.


Agreeing with InvestPic, the Federal Circuit held that “bias parameter” had only one reasonable meaning when “considered alone and in light of the specification” and that this limitation was not in the prior art.  The claim explicitly states that the bias parameter “determines a degree of randomness in sample selection in a resampling process.” This language made clear that a bias parameter is used to select samples from the sample space, not to create a sample space, and not to combine statistical measures previously calculated from separate, resampled analyses. This contradicted the PTAB’s interpretation, which failed to account for how samples are selected.  The Federal Circuit reversed the PTAB’s rejections based on this erroneous interpretation, because the prior art did not disclose a properly construed “bias parameter.”

With respect to the “statistical analysis request,” the Federal Circuit found the PTAB’s interpretation “unreasonable” and remanding for further proceedings under the correct claim construction.  InvestPic asserted that the statistical analysis requested is one that covers two or more investments.  The PTAB found this limitation in the prior art, but only after determining that the claims provide no “temporal limitation . . . indicating that ‘two or more investments’ are analyzed at the same time.”  The Federal Circuit disagreed, because the plain language of the full claim term required “a statistical analysis request corresponding to two or more selected investments.” (emphasis added). Thus, a single request must correspond to at least two investments. The Court remanded for further consideration of anticipation and obviousness based on the proper construction.


The Author

Joseph Robinson

Joseph Robinson has over 20 years of experience in all aspects of intellectual property law. He focuses his practice in the pharmaceutical, life sciences, biotechnology, and medical device fields. His practice encompasses litigation, including Hatch-Waxman litigation; licensing; counseling; due diligence; and patent and trademark prosecution. He has served as litigation counsel in a variety of patent and trademark disputes in many different jurisdictions, and has also served as appellate counsel before the Court of Appeals for the Federal Circuit. Joe also focuses on complex inter partes matters before the U.S Patent and Trademark Office, inventorship disputes, reexaminations and reissues. His experience includes numerous interferences, a particular advantage in new U.S. Patent and Trademark Office post-grant proceedings. He also counsels on patent–related U.S. Food and Drug Administration issues, including citizen petitions, Orange Book listing, and trademark issues. For more information and to contact Joe please visit his profile page at the Troutman Sanders website.

Joseph Robinson

Robert Schaffer is an intellectual property partner at Troutman Sanders. Bob applies more than 30 years of experience to IP counseling and litigation. His work includes patent procurement, strategic planning and transactional advice, due diligence investigations, district court patent cases, and Federal Circuit appeals. He regularly handles complex and high-profile domestic and international patent portfolios, intellectual property agreements and licensing, IP evaluations for collaborations, mergers, and acquisitions. In disputed court cases Bob’s work includes representing and counseling client in ANDA litigations, complex patent infringement cases and appeals, and multidistrict and international cases. In disputed Patent Office matters his work includes representing and counseling clients in interferences, reexaminations, reissues, post-grant proceedings, and in European Oppositions. For more information and to contact Bob please visit his profile page at the Troutman Sanders website.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 1 Comment comments.

  1. Paul F, Morgan March 20, 2016 11:06 am

    It is pleasing to see more Fed. Cir. IPR remands like this enforcing BRI claim interpretation standards (applying what seems to be essentially the same claim language interpretation requirements as Phillips). However, it leaves an important question unanswered. How effective are these appeals? Namely, how many patent owners win or lose these remanded IPRs with corrected claim BRIs?