Court Opinion

ID: 3191412
Source: CourtListenerOpinion
Date Created: 2016-04-05 16:01:05.382159+00
Date Added: 2024-06-11T12:05:31.576793
License: Public Domain

United States Court of Appeals
      for the Federal Circuit
                ______________________

                       HP INC.,
                       Appellant

                           v.

    MPHJ TECHNOLOGY INVESTMENTS, LLC,
                   Appellee
            ______________________

                      2015-1427
                ______________________

    Appeal from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in No. IPR2013-
00309.
                 ______________________

                Decided: April 5, 2016
                ______________________

    CHARLENE M. MORROW, Fenwick & West, LLP, Moun-
tain View, CA, argued for appellant. Also represented by
STUART P. MEYER, RAVI RAGAVENDRA RANGANATH.

    VIVEK GANTI, Hill, Kertscher & Wharton LLP, Atlan-
ta, GA, argued for appellee. Also represented by STEVEN
G. HILL.

    AMY J. NELSON, Office of the Solicitor, United States
Patent and Trademark Office, Alexandria, VA, argued for
intervenor Michelle K. Lee. Also represented by THOMAS
2                                 HP INC. V. MPHJ TECH. INVS.

W. KRAUSE, SCOTT WEIDENFELLER, JOSEPH GERARD
PICCOLO.
              ______________________
    Before LOURIE, SCHALL, and HUGHES, Circuit Judges.
LOURIE, Circuit Judge.
    HP Inc. (“HP”) appeals from the final decision of the
United States Patent and Trademark Office (“PTO”)
Patent Trial and Appeal Board (the “Board”) in an inter
partes review (“IPR”) proceeding finding claims 1–12, 14,
and 15 of U.S. Patent 6,771,381 (the “’381 patent”), owned
by MPHJ Technology Investments (“MPHJ”), unpatenta-
ble as anticipated, and finding claim 13 of the ’381 patent
not unpatentable as anticipated. See Hewlett-Packard Co.
v. MPHJ Tech. Invs., LLC, IPR2013-00309, 2014 WL
6617698 (P.T.A.B. Nov. 19, 2014) (“Final Decision”). HP
argues that the Board erred by not also finding claim 13
unpatentable as anticipated, and challenges the Board’s
decision not to review whether claim 13 is unpatentable
as obvious. Because the Board did not err and because we
cannot review the decision not to institute, we affirm.
                       BACKGROUND
    MPHJ is the owner of the ’381 patent, entitled “Dis-
tributed Computer Architecture and Process for Virtual
Copying,” which issued on August 3, 2004. The ’381
patent discloses a method and system that “extend[] the
notion of copying . . . to a process that involves paper
being scanned from a device at one location and copied to
a device at another location.” ’381 patent col. 5 ll. 47–51.
“What makes Virtual Copier as simple as its physical
counterpart . . . is the fact that it replicates the identical
motions that a user who is making a copy using a physical
photocopier goes through.” Id. col. 6 ll. 47–51. Claim 13,
the only claim at issue in this appeal, reads as follows:
    13. A computer data management system includ-
    ing a server module comprising:
HP INC. V. MPHJ TECH. INVS.                               3

    enable virtual copy operation means for initiating,
    canceling, and resetting said computer data man-
    agement system;
    maintain list of available module means for main-
    taining a registry containing a list of said input,
    output, and process modules that can be used in
    said computer data management system, said list
    being read on startup, and maintaining another
    copy of said list in a modules object accessible by
    said input, output, client, process and server
    modules;
    maintain currently active modules means for
    maintaining said input, output, and process mod-
    ules currently being used for a current computer
    data management system copy operating in a pro-
    gram object, and saving the currently active mod-
    ules in a process template file; and
    maintain complete document information means
    for maintaining information regarding a current
    file being copied, and saving the information in a
    document template file.
Id. col. 87 l. 45–col. 88 l. 6 (emphasis added). Claim 13
thus requires, inter alia, a list of available modules,
including input, output, and process modules. See id.
    After acquiring the ’381 patent, MPHJ sent letters to
numerous small businesses, alleging that those business-
es likely infringed the ’381 patent, among others. Joint
Appendix (“J.A.”) 2228–29. As “[a] good example of an
infringing system,” the letter described a scanner con-
nected to a local area network in communication with a
server, whereby an employee could scan documents at the
scanner and have the documents sent to the employee’s
email address. J.A. 2229.
    Because the letters were sent to users of HP’s multi-
function printers, HP petitioned for IPR of the ’381 pa-
4                                 HP INC. V. MPHJ TECH. INVS.

tent. In its petition, HP alleged that the claims of the ’381
patent were unpatentable either as anticipated or as
obvious. J.A. 94. HP alleged seven grounds of anticipa-
tion and one ground of obviousness. J.A. 2229. This
appeal only implicates three grounds: Ground 1, that all
claims are unpatentable as anticipated under 35 U.S.C.
§ 102(b)1 by HP ScanJet 5 Scanner User’s Guide (“SJ5”),
the user’s guide for one of HP’s network scanners; Ground
6, that all claims are unpatentable as anticipated by U.S.
Patent 5,499,108 (“Cotte”), which is directed to a network
scanner; and Ground 8, that claims 5, 7, 9, 11–13, and 15
are unpatentable as obvious under 35 U.S.C. § 103(a) over
an HP ScanJet 5 Press Release describing the SJ5 scan-
ner (“SJ5PR”), in view of SJ5. J.A. 2229.
     The Board instituted review of all of the claims of the
’381 patent, finding that HP established a reasonable
likelihood that the claims were unpatentable as anticipat-
ed by either Cotte or SJ5. J.A. 33, 38. The Board de-
clined to institute review based on the other asserted
grounds of unpatentability, concluding that “[t]he addi-
tional grounds are . . . redundant in light of the determi-
nation that there is a reasonable likelihood that the
challenged claims are unpatentable based on the grounds
of unpatentability on which we institute an inter partes
review.” J.A. 38. As authority for denying review based
on redundancy, the Board cited 37 C.F.R. § 42.108(a),
which provides that “[w]hen instituting inter partes
review, the Board may authorize the review to proceed on
all or some of the challenged claims and on all or some of
the grounds of unpatentability asserted for each claim.”

    1    Because the ’381 patent was filed before the adop-
tion of the Leahy-Smith America Invents Act, Pub. L. No.
112-29, § 3, 125 Stat. 284, 285–93 (2011), the prior ver-
sion of § 102 governs this appeal. See Fleming v. Escort,
Inc., 774 F.3d 1371, 1374 n.1 (Fed. Cir. 2014).
HP INC. V. MPHJ TECH. INVS.                               5

HP did not seek rehearing of that decision. See 37 C.F.R.
§ 42.71.
    After institution, MPHJ filed a response, HP filed a
reply, and the Board held an oral hearing. J.A. 42.
During the hearing, Administrative Patent Judge
Easthom questioned counsel for HP regarding whether
the “maintain list of available module means” limitation
was taught by SJ5. See J.A. 2877–79. Specifically, Judge
Easthom asked counsel for HP to identify the process and
server modules appearing in SJ5. J.A. 2879. Counsel
responded that “[t]here is no specific name” for those
modules. J.A. 2879.
     In the final written decision, issued November 19,
2014, the Board found that claims 1–12, 14, and 15 were
unpatentable as anticipated by Cotte. Final Decision at
*16–29. The Board found that Cotte did not anticipate
claim 13 because HP did not establish that Cotte disclosed
the claimed list of available module means. Id. at *28–29.
In reaching that conclusion, the Board cited the exchange
between Judge Easthom and counsel for HP at oral ar-
gument, and noted that HP did not “point out the specific
list or show it is read on start-up.” Id.
    The Board then analyzed whether claim 13 was un-
patentable as anticipated by SJ5. Id. at *29–30. The
Board noted that HP did not respond to MPHJ’s argu-
ments that claim 13 was not anticipated, and again cited
the exchange at oral argument. Id. Moreover, the Board
reasoned that, although “[t]he Petition generally refers to
the analysis of claims 1, 2, and 7 to address the limita-
tions in claim 13 . . . , those claims recite different ele-
ments.” Id. at *30. Finally, the Board found that HP did
“not specify clearly how SJ5 discloses all the recited and
argued elements” because HP did not “specify the re-
quired lists of modules.” Id. Accordingly, the Board
found that HP had not met its burden of establishing the
unpatentability of claim 13.
6                                HP INC. V. MPHJ TECH. INVS.

    HP timely appealed, and the Director of the U.S. Pa-
tent and Trademark Office (the “Director”) intervened
pursuant to 35 U.S.C. § 143, filing a brief and participat-
ing in oral argument. We have jurisdiction to review the
final decision in an IPR proceeding pursuant to 28 U.S.C.
§ 1295(a)(4)(A).
                         DISCUSSION
                    I.   ANTICIPATION
    “Anticipation is a question of fact reviewed for sub-
stantial evidence.” In re Rambus, Inc., 753 F.3d 1253,
1256 (Fed. Cir. 2014). A finding is supported by substan-
tial evidence if a reasonable mind might accept the evi-
dence as sufficient to support the finding. Consol. Edison
Co. v. NLRB, 305 U.S. 197, 229 (1938).
    HP argues that the Board did not consider all of the
evidence presented, and that therefore the Board’s find-
ings are not supported by substantial evidence. Specifi-
cally, HP argues that although the Board asserted that
HP’s arguments relating to claim 13 were a repetition of
the arguments HP had made with respect to claims 1, 2,
and 7, HP had also referenced arguments and evidence
presented relating to claim 9. Appellant’s Br. 16–17.
Because the Board did not address those arguments, HP
argues, it asks that the Board’s decision be reversed. Id.
at 19.
     HP also argues that SJ5 does teach the “list of availa-
ble module means” and so the Board’s finding to the
contrary is not supported by substantial evidence. HP
reasons that because a preferred embodiment of the ’381
patent teaches that the Windows registry contains the list
of available modules, and SJ5 teaches using “lists of
destinations, workflows, and the like [that are] started
automatically when Windows is started,” SJ5 reads on the
“list of available module means” limitation. Id. at 15–19.
HP INC. V. MPHJ TECH. INVS.                               7

    MPHJ responds that the Board fully considered HP’s
arguments, expert testimony, the prior art, and MPHJ’s
response to the petition, and reasonably found that claim
13 was not unpatentable as anticipated. Appellee’s Br. 3–
5.
    We agree with MPHJ that the Board fully considered
all of the evidence that HP presented. Although the
Board decision does not directly state that it considered
the evidence relating to claim 9, that evidence is almost
identical to the evidence that HP presented with respect
to claim 13. J.A. 2275, 2277. As the Board stated, the
evidence regarding both claims “generally refers to the
analysis of claims 1, 2, and 7[.]” Final Decision at *30.
The only evidence listed in the treatment of claim 9, but
not listed in the treatment of claim 13, is pages 33, 34,
and 114 of SJ5. Compare J.A. 2275, with J.A. 2277.
Those pages of SJ5 are cited in paragraph 132 of HP’s
expert report, however, and paragraph 132 is listed in the
treatment of claim 13. J.A. 1357, 2277. Accordingly, the
Board did consider the evidence that HP alleges had been
neglected.
    Moreover, review of SJ5 reveals that the Board’s find-
ing that it does not teach a “list of available module
means” is supported by substantial evidence. HP’s peti-
tion does not specifically identify what it views as the
input, output, and process modules. See J.A. 1357, 1361,
2275, 2277. The only “lists” HP identifies are “lists of
destinations, workflows, and the like,” and the evidence
presented does not equate destinations or workflows with
input, output, or process modules. See J.A. 1357, 1458–
59, 1539. As the Board noted, even at oral argument HP
“was unable to specify the relevant names for the process
or server modules appearing in a list or lists recited.”
Final Decision at *30. Given this evidence, the Board did
not err in finding that SJ5 did not teach the required “list
of available module means.” Accordingly, we affirm the
Board’s finding that claim 13 is not anticipated by SJ5.
8                                HP INC. V. MPHJ TECH. INVS.

                II. DECISION TO INSTITUTE
    HP also challenges the Board’s refusal to institute re-
view on the basis that that HP’s obviousness ground in
the petition was redundant in view of the instituted
anticipation grounds.
     Before reaching the merits of HP’s argument, we must
first address whether we have jurisdiction to consider the
argument at all. Under 35 U.S.C. § 314(d), “[t]he deter-
mination by the Director whether to institute an inter
partes review under this section shall be final and nonap-
pealable.”
    HP argues that § 314(d) does not prevent our review
of the issue of redundancy because the “under this sec-
tion” language means that only determinations made
under § 314 generally are immune from review. Id. As
the only determination in § 314 is the determination
whether “the information presented in the petition . . .
and any response . . . shows that there is a reasonable
likelihood that the petitioner would prevail with respect
to at least one of the claims challenged in the petition,”
HP argues, only that determination is immune from
review. Appellant’s Br. 24 (quoting 35 U.S.C. § 314(a)).
HP argues that, as a result, the § 314(d) bar does not
apply to this case because § 314 does not give the Director
the authority to refuse to institute review based on a
determination of redundancy. MPHJ and the Director
respond that we have interpreted § 314(d) to foreclose
review of issues other than the § 314(a) determination.
Appellee’s Br. 5–7; Intervenor’s Br. 16–18, 20–24.
    We agree with MPHJ and the Director that the
§ 314(d) bar on judicial review is not limited to the deter-
mination whether there is a reasonable likelihood that
the petitioner would prevail. In Achates Reference Pub-
lishing v. Apple Inc., we specifically rejected as “crabbed
and . . . contradicted by this court’s precedent” the argu-
ment that the “under this section” language in § 314(d)
HP INC. V. MPHJ TECH. INVS.                                9

limited the bar on review. 803 F.3d 652, 658 (Fed. Cir.
2015). Moreover, we have found that § 314(d) bars our
review of aspects of the institution decision other than the
§ 314(a) determination whether there is a reasonable
likelihood that the petitioner would prevail. SightSound
Techs., LLC v. Apple Inc., 809 F.3d 1307, 1313–14 (Fed.
Cir. 2015) (refusing to review Board’s consideration of
obviousness in the final decision despite not being raised
in the initial petition); Achates, 803 F.3d at 658 (refusing
to review the Board’s assessment of the time-bar provi-
sions of § 315(b)); In re Cuozzo Speed Techs., LLC, 793
F.3d 1268, 1273–74 (Fed. Cir. 2015), cert. granted sub
nom. Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 890
(U.S. Jan. 15, 2016) (No. 15-446) (refusing to review the
Board’s decision to institute review of certain claims on
the basis of prior art not asserted regarding those claims).
Indeed, we recently held that § 314(d) bars our review of
the Board’s decision not to institute IPR on redundancy
grounds. See Shaw Indus. Grp., Inc. v. Automated Creel
Sys., Inc., Nos. 15-1116, 15-1119, ___ F.3d ___, slip. op. at
6–9 (Fed. Cir. Mar. 23, 2016); Harmonic Inc. v. Avid
Tech., Inc., No. 15-1072, ___ F.3d ___, 2016 WL 798192, at
*7–9 (Fed. Cir. Mar. 1, 2016).
    HP next argues that § 314(d) does not bar review of
this case because we can review “whether the Board ha[s]
properly construed the scope of its authority.” Reply Br.
15 (citing Versata Dev. Grp., Inc. v. SAP Am., Inc., 793
F.3d 1306 (Fed. Cir. 2015)). HP argues that just as Versa-
ta addressed the Board’s determination whether a patent
was a covered business method (“CBM”) patent, and
therefore whether the Board had the statutory authority
to review it, the present case addresses the Board’s statu-
tory authority. The Director responds that the Board did
not exceed its statutory authority by refusing to institute
review for redundancy, and therefore Versata does not
apply.
10                               HP INC. V. MPHJ TECH. INVS.

    We agree with the Director that Versata does not re-
quire us to review the Board’s institution decision in this
case. Versata explained that review was proper in that
case because the CBM determination was the “defining
characteristic” of the Board’s “authority to invalidate” the
patent. Versata, 793 F.3d at 1320–21. Accordingly, in
Achates we concluded that Versata did not permit review
of the Board’s application of the § 315(b) time bar because
the time bar did “not impact the Board’s authority to
invalidate a patent claim—it only bar[red] particular
petitioners from challenging the claim.” 803 F.3d at 657.
In that case, the patent could still be challenged “via a
properly-filed petition from another petitioner.” Id.
    Similarly, a redundancy determination does not im-
pact the Board’s authority to find a claim unpatentable.
It only prevents the claim from being challenged on a
particular basis in that particular IPR proceeding. In-
deed, the Director concedes that HP may challenge
whether claim 13 is unpatentable as obvious in another
petition. Intervenor’s Br. 36. As in Achates, then, a
refusal to institute review on the basis of redundancy does
not impact the Board’s authority to find a claim un-
patentable.
    HP next argues that the Board does not possess the
authority to institute review only on a subset of the
grounds presented in the petition for review. Appellant’s
Br. 31–39. If the Board determines that there is reasona-
ble likelihood that the petitioner would prevail on one
claim, HP argues, then the Board must issue a written
decision reviewing all claims and all grounds properly
presented in the petition for review. Id. at 31–32. The
Director responds that the Board may choose to institute,
or not institute, review on any of the grounds presented, if
it so chooses, and that § 314(a) only establishes the
threshold that must be met for review; it does not compel
review.
HP INC. V. MPHJ TECH. INVS.                              11

    Harmonic addressed whether we could review the
Board’s decision to institute review on some, but not all,
of the grounds presented in a petition. There, we noted
that our prior decisions prohibited review of both the
decision to institute an IPR and the decision not to insti-
tute an IPR. Harmonic, 2016 WL 798192, at *7 (citing
Cuozzo, 778 F.3d at 1276 and St. Jude Med., Cardiology
Div., Inc. v. Volcano Corp., 749 F.3d 1373, 1375–76 (Fed.
Cir. 2014)). As the decision to institute on a subset of
grounds was “simply a combination of the two,” we con-
cluded that we could not review that decision. Id. Ac-
cordingly, Harmonic dictates that § 314(d) bars our
review of the decision to institute on only some grounds.
    We also recently addressed whether the Board is re-
quired to address all grounds presented in the petition for
review, including the grounds on which IPR was not
instituted, in its final written decision. Synopsys, Inc. v.
Mentor Graphics Corp., No. 14-1516, 2016 WL 520236, at
*3–5 (Fed. Cir. Feb. 10, 2016). Relying on the statutory
text, we concluded “that the Board need only issue a final
written decision with respect to claims on which inter
partes review has been initiated and which are challenged
by the petitioner after the institution stage.” Id. at *4.
Accordingly, the Board is not required to address claims
or grounds for which review had not been instituted in its
final written decision. See id. Together, Harmonic and
Synopsys foreclose HP’s arguments. Therefore, we cannot
review HP’s argument that the Board erred by instituting
review on only a subset of grounds, and we conclude that
the Board did not err in only addressing the instituted
grounds in its final written decision.
    HP next challenges whether the Board fulfilled its ob-
ligations under the Administrative Procedure Act (“APA”).
Specifically, HP argues that the Board did not fulfill its
APA obligations because it did not address all of the
grounds in the petition in its final decision. Appellant’s
Br. 47–48 (citing 5 U.S.C. § 557(c)). The Director re-
12                               HP INC. V. MPHJ TECH. INVS.

sponds that the Board met its APA obligations. Interve-
nor’s Br. 19–21.
    We agree with the Director that the Board met its ob-
ligations under the APA. 2 As we have previously ex-
plained, “[d]uring the institution phase [of the IPR], the
Board establishes parameters that confine the proceeding
during the merits phase.” Harmonic, 2016 WL 798192, at
*8. Accordingly, “[u]nder the PTO’s regulations, grounds
not instituted never become part of the merits phase of
the IPR proceeding.” Id. In Harmonic, we upheld those
regulations as within the scope of the PTO’s authority.
Id. at *9. Because the noninstituted grounds were never
a part of the merits phase of the IPR proceeding, the APA
does not require the Board to address those grounds in its
final written decision. Here, in the final written decision,
the Board addressed, analyzed, and weighed each of HP’s
arguments regarding the grounds instituted; accordingly,
the Board met its APA obligations.
    Finally, HP argues that the Board did not sufficiently
articulate the reasons for its redundancy conclusion under
the APA. This issue is reviewable, HP argues, due to the
strong presumption of judicial review of agency action.
The Director responds that § 314(d) shows that Congress
intended for the Board’s institution decision to be immune
from judicial review. Intervenor’s Br. 19–21.
    We agree with the Director that § 314(d) prevents our
review of the Board’s reasons for its redundancy determi-
nation. Allowing an APA challenge to the Board’s deci-
sion to institute on the basis that the Board had
insufficiently articulated its reasoning would eviscerate
§ 314(d) by allowing substantive review of the institution

     2  The parties in Synopsys did not raise any APA ar-
gument, and therefore Synopsys does not control on this
point. See Synopsys, 2016 WL 520236, at *3–6.
HP INC. V. MPHJ TECH. INVS.                             13

decision. Although there is a strong presumption of
judicial review of administrative action, that presumption
may be overcome where “there is persuasive reason to
believe that such was the purpose of Congress.” Bowen v.
Mich. Acad. of Family Physicians, 476 U.S. 667, 670
(1986). Congress, through § 314(d), has explicitly stated
that the Board’s institution decision “shall be final and
nonappealable.” Thus, that specific statutory language
precludes our review.
    HP expresses concern that it will be estopped from
challenging claim 13 in a future proceeding. Specifically,
HP worries that 35 U.S.C. § 315(e)(1), which estops a
petitioner from requesting review on the basis of any
ground that the petitioner “raised or reasonably could
have raised” during a previous IPR that led to a final
written decision, would preclude subsequent review.
Appellant’s Br. 39. As evidence, HP cites the Board’s
decision not to institute review in another proceeding,
where the Board concluded that HP could have presented
the ground in a previous IPR. Id.
    As we explained supra, however, the noninstituted
grounds do not become a part of the IPR. Accordingly, the
noninstituted grounds were not raised and, as review was
denied, could not be raised in the IPR. Therefore, the
estoppel provisions of § 315(e)(1) do not apply. See Shaw,
slip op. at 10–11. Indeed, the Director concedes that “HP
is not estopped from raising the obviousness of claim 13 in
a subsequent court or Board proceeding, and a challenger
cannot assert that the nonobviousness of claim 13 was
resolved by the Board in this proceeding.” Intervenor’s
Br. 36.
    Accordingly, we cannot review the Board’s refusal to
institute IPR on redundancy grounds, and we find that
the final written decision meets the agency’s obligations
under the APA.
14                            HP INC. V. MPHJ TECH. INVS.

                     CONCLUSION
    We have considered HP’s remaining arguments, but
find them unpersuasive. For the foregoing reasons, the
decision of the Board is affirmed.
                    AFFIRMED