DSS Technology Management, Inc., v. Apple, Inc.
2018 U.S. App. LEXIS 7438 (Fed. Cir. 2018)
Authored by Emilee Woodfin
Statement of Facts: Appellant DSS Technology Management, Inc. (“DSS”) owned Patent No. 6,128,290 (“the ’290 patent”). Issued in 2000, the ’290 patent is directed to cover a wireless communication network between a single host device to multiple peripheral devices, allowing both the host and peripherals to send and receive data.
The design outlined in the ’290 patent allows for communications between a host server, typically an individual’s personal digital assistant (PDA) device, and a number of peripheral devices, typically personal electronic accessories (PEA). The goal of the technology is not only for the devices to wirelessly exchange information, but for the ancillary PEAs to only consume power when they are in use with the host server. This is achieved by assigning a subset of time slots to each peripheral unit in which it will receive or transmit data to the server, and during the timeslots when a peripheral PEA unit is neither receiving nor transmitting, its reception and transmission circuitry can be powered down. Thus, the device is only using power when it is cycling through the timeslots of low duty radio frequency (RF) bursts, during actual transmission with the host server.
In dispute is a single claim limitation recited in claim 1 of the ’290 patent which pertains to the “low duty cycle RF bursts,” requiring both the server and peripheral units to comprise transmitters that are able to cycle through low duty burses. This was the only dispute on appeal.
Procedural History: On December 4, 2015, appellee, Apple, Inc. (“Apple”), filed two IPR petitions regarding the ’290 patent. The first petition challenged the validity of claims 1-4 of the ’290 patent and the second challenged the validity of claims 6, 7, 9, and 10. The board conducted two IPRs to determine whether claims 1-4 were obvious, and to determine the obviousness of claims 6 and 7 over U.S. Patent No. 5,696,903 to Mahany. DSS disclaimed 6 and 7 of the ’290 patent.
The PTAB relied on two pieces of prior art in the proceedings: U.S. Patent No. 5,241,542 to Natarajan et al. (“Natarajan”), and U.S. Patent No. 4,887,266 to Neve et al. (“Neve”). The PTAB concluded that Natarajan and Neve rendered all the challenged claims of the ’290 patent obvious. The Federal Circuit only found Natarajan relevant to the appeal, and thus applied the obviousness inquiry only utilizing Natarajan.
The PTAB issued a final written decision on June 17, 2016, finding that all remaining challenged claims, 1-4, 9, and 10, were invalid as obvious over Natarajan in view of Neve. DSS conceded all but one limitation in each of these claims as being disclosed in Natarajan and Neve, but disputed that either formerly issued patent covered the ’290 patent’s limitation regarding the low duty cycle RF bursts. The PTAB found that the modification made by DSS to previously patented material in Natarajan was an obvious modification, because DSS simply applied the low duty cycle RF burst technology to the host server device and the peripheral devices, whereas Natarajan only applied such technology to the host server’s incoming and outgoing capabilities.
The Federal Circuit found that the board did not provide a sufficient explanation for its conclusions and reversed.
Questions Presented: The question was whether the PTAB correctly deemed obvious the low duty use RF cycles claimed in the ’290 patent in light of Natarajan. “Obviousness is a question of law based on underlying findings of fact.” In re Jubin, 561 F.3d 1351, 1355 (Fed. Cir. 2009).
Holdings: No, the PTAB did not correctly deem the ’290 patent claim obvious over Natarajan by because the PTAB failed to provide sufficient explanation for its obviousness finding. There was not adequate evidence for the Federal Circuit to either uphold the PTAB finding, or determine obviousness itself.
Reasoning: In critiquing the PTAB’s insufficient analysis, the Federal Circuit first considered the Arendi “common sense” standard in its obviousness inquiry, noting that three caveats to that standard apply here. Arendi S.A.R.L. v Apple Inc., 832 F.3d 1355, 1361 (Fed. Cir. 2016).
First, common sense is usually used to show a known motivation to combine, not to furnish a missing claim limitation. Second, if common sense is used to fill in a missing limitation, it can only be when the limitation in question was “unusually simple” and the technology particularly straight forward. Finally, whether to supply a motivation to combine, or for a missing limitation, “common sense” cannot be a “wholesale substitute for reasoned analysis and evidentiary support.” The PTAB relied on an “ordinary creativity” standard, which the court found to be no different from the “common sense” standard, adding that an inquiry to supply a missing claim limitation based on either “common sense” or “ordinary creativity” must be more searching than the one the PTAB engaged in.
With this framework, the court found that the PTAB did not satisfy the Arendi standard.
Next, the court determined that the PTAB made insufficient citations to the record in finding that a person of ordinary skill would have thought to modify Natarajan the way that DSS did. The PTAB also erroneously relied on Apple’s expert, Dr. Hu, because it never cited directly to her testimony, and her conclusory findings were insufficient to support the PTAB finding.
The court stated that although the transmission hardware in DSS and Natarajan were similar, it cannot be concluded that the additional claim made in the ’290 patent of low duty cycle RF bursts could be assumed to have been the natural step in improving upon Natarajan without additional, reasons analysis. Ultimately, the court found that the court could not itself determine the question of obviousness based on Natarajan, thus reversed.
Dissenting Opinion: Judge Newman dissented, finding first that the PTAB inquiry was not deficient and second that, even if the PTAB conclusion was erroneous, the proper appellate response was to remand for additional investigation or explanation. Judge Newman asserted that the PTAB’s record was heavy with reference to testimony, arguments, and briefing, such that its conclusion was adequately supported and explained. Judge Newman found that the panel majority failed to recognize the ample evidence cited by the PTAB. Specifically, Judge Newman found Dr. Hu’s testimony to be far more persuasive and that Dr. Hu’s conclusion that the disputed claim in the ’290 patent is the “natural result of Natarajan’s communication protocol” was sufficiently explained.
Further, Judge Newman disagreed with the remedy as merely reversing was rendering a final judgment for DSS where a final conclusion of obviousness was never reached.