United States: Spotlight On Upcoming Oral Arguments – August 2019

Blair v. Kawasaki Rail Car, Inc., No. 18-2098, Courtroom 201

Scott Blair appeals from a final decision from the PTAB finding the challenged claims of U.S. Patent No. 6,700,602 (“the ’602 patent”) invalid as obvious.  The ’602 patent is directed to a subway television media system that is mounted substantially flush with the wall.  In determining that the challenged claims are obvious, the PTAB relied upon four prior art references.  One of those references is Sasao, which relates to placing a television inside of a custom built cabinet that creates a flush surface with the television and the cabinet paneling.

On appeal, Mr. Blair argues that the Sasao reference relates to an invention that operates in an entirely different environment, a residence or commercial building, and is intended to achieve an entirely unrelated goal, hiding the television.  Thus, Mr. Blair argues that the PTAB erred in relying on the Sasao reference because it is not analogous prior art.  Kawasaki argues that the Sasao reference not only is in the same field of endeavor, video display systems, but also reasonably addresses a problem pertinent to the problem the claimed invention aimed to solve, aesthetics and increased visibility.  Thus, Kawasaki argues that Sasao is analogous prior art and that the PTAB properly relied upon the Sasao reference in finding the challenged claims invalid as obvious.

UCP International Company Limited v. Balsam Brands Inc., No. 18-1256, Courtroom 402

In 2015, Balsam sued the customers of UCP in the Northern District of California.  During that litigation, terms in the asserted claims were construed during temporary restraining order proceedings and during Markman proceedings.  After the Markman proceeding, the parties reached a settlement agreement.  UCP then brought a declaratory judgment action against Balsam to resolve Balsam’s public allegations that UCP was infringing Balsam’s patents.  The Court held that collateral estoppel precludes Balsam from arguing for a different construction of the claims.  Applying that construction, the court granted UCP’s motion for summary judgment of non-infringement. 

On appeal, Balsam argues, among other things, that the district court erred in applying the doctrine of collateral estoppel.  Balsam contends that the claim construction is not binding because the litigation ended due to settlement so it did not have a chance to appeal the erroneous claim construction.  Further, Balsam argues that the case never proceeded to final judgment on the merits, therefore, it is not “procedurally final” and cannot be relied upon for collateral estoppel.  In response, UCP argues that Balsam was afforded ample opportunity to be fully heard and that allowing Balsam a third bit of the apple would run counter to the goal of collateral estoppel: preservation of scarce judicial resources.  UCP further argues that collateral estoppel is particularly appropriate here, where the second litigation has the same judge, parties, patents, disputed terms, and accused products.

B.E. Technology, L.L.C. v. Facebook, Inc., No. 18-2356, Courtroom 203

After being sued by B.E. Technology for patent infringement in the Western District of Tennessee, Facebook filed a petition seeking inter partes review of the asserted claims of U.S. Patent No. 6,628,314.  The PTAB found all of the challenged claims invalid and the district court subsequently dismissed B.E. Technology’s claims as moot and entered final judgment in favor of Facebook.  Facebook then filed a motion for costs under Federal Rule of Civil Procedure 54(d).  The Clerk of Court found that Facebook was a “prevailing party” and awarded costs in the amount of $4,424.20.

B.E. Technology argues that when the case was dismissed for mootness, the district court no longer had the authority to adjudicate or rule on the claims.  Because the district court could not make any ruling, B.E. Technology argues there could be no “prevailing party.” B.E. Technology further argues that the decision from the PTAB cannot make Facebook the “prevailing party” because Federal Rule of Civil Procedure 54(d) requires adjudication by the court.  Facebook argues that a defendant need not obtain a favorable judgment on the merits to be considered a “prevailing party.”  Facebook contends that it is the prevailing party in this case because it invalidated the asserted claims, thereby rebuffing B.E. Technology’s infringement claims in the district court.

Tuesday, August 6, 2019

ChanBond, LLC v. Cisco Systems, Inc., No. 18-1886, Courtroom 203

ChanBond appeals from a PTAB decision in an inter partes review finding the challenged claims of U.S. Patent No. 7,941,822 invalid as obvious.  In its institution decision, the PTAB indicated that a Qualcomm Data Connectivity Kit User Guide (“the User Guide”), which purportedly taught how to use a cellular phone as a wireless modem, could not be relied upon by Cisco because Cisco did not identify the User Guide as prior art in its grounds for invalidity.  During oral arguments, Cisco relied upon the User Guide to establish that there would have been a motivation to combine the prior art references.  Similarly, in its final written decision, the PTAB relied upon the User Guide to demonstrated that a person of ordinary skill in the art would have had a motivation to combine.

On appeal, ChanBond argues that the PTAB’s reliance on the User Guide is a violation of its due process rights.  Specifically, ChanBond argues that it relied upon the PTAB’s statement in the institution decision and did not further address the User Guide in its subsequent written submissions or expert declaration.  Thus, Cisco contends it had no reason or opportunity to address the motivation argument advanced by Cisco and relied upon by the PTAB in its final written decision.  Cisco argues that the PTAB did not exclude the User Guide altogether but only as a standalone prior art reference.  Cisco contends that there was no due process violation and ChanBond’s failure to address the User Guide in its written submissions was a strategic choice.  Further, Cisco argues that ChanBond raised its challenges to the weight and admissibility of the User Guide at the oral argument.

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