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Federal Circuit Finds PTAB Implicitly And Incorrectly Construed Claim In Final Decision
02/13/2024On February 7, 2024, the Court of Appeals for the Federal Circuit (“CAFC”) reversed a final written decision from the U.S. Patent Trial and Appeal Board (“PTAB”) finding the challenged claims of the ’753 patent not unpatentable. Google LLC v. EcoFactor, Inc., __ F.3d __ (Fed. Cir. Feb. 7, 2024). In its precedential decision reversing and remanding, the CAFC found that the PTAB relied on an implicit construction of a claim limitation and that this construction was wrong.
Appellant petitioner filed a petition for inter partes review of claims 1-20 of appellee’s ’753 patent, which relates to controlling heating and cooling systems (“HVAC” systems) and claims methods to reduce HVAC system cycling time when a user seeks a specific temperature at a specified target time. Following institution, the parties disputed whether the prior art disclosed the italicized portions of the claim 1[m] limitation that reads “determining a first time prior to said target time at which said climate control system should turn on to reach the target temperature by the target time based at least in part on [i] said one or more thermal performance values of said structure, [ii] said performance characteristic of said climate control system, [iii] said first internal temperature, [iv] said first external temperature, and [v] the forecasted temperature.”
Appellant petitioner argued that the prior art calculated a “first time prior to said target time” based on thermal performance values (input [i] in limitation 1[m]) which are themselves calculated from internal temperature values (input [iii]). EcoFactor disagreed, contending that each input in the 1[m] limitation was distinct and could not be intertwined with another, or else it would render certain claim limitations meaningless. Neither party explicitly argued for claim construction to resolve the issue.
In its final written decision, the PTAB concluded that claim construction was unnecessary, and that appellant had not established unpatentability because the inputs [i]–[v] of the 1[m] limitation were separate and distinct components that required distinctly different input data. Petitioner appealed on the basis that the Board’s final written decision implicitly adopted a construction of limitation 1[m] not previously proposed, in violation of the Administrative Procedure Act’s (“APA”) notice requirements, and that the construction was wrong.
On appeal, the CAFC first considered whether the PTAB in fact construed limitation 1[m] in its final written decision and concluded that it did. The CAFC first acknowledged that it is not always clear, when assessing an invalidity challenge, whether a court or other tribunal has implicitly construed a claim or whether it has simply compared the claim to the prior art. The CAFC also acknowledged that the answer to this question can be critical given the different standard of review applicable to each issue, claim construction requiring de novo review and prior art analysis requiring only substantial evidence review.
To determine whether claim construction occurred, the CAFC suggested that it was appropriate to look to whether the outcome of the analysis performed puts a boundary on the claim’s scope. Following this approach, the CAFC concluded that the PTAB’s analysis did define the scope of claim 1 by requiring that no input listed in limitation 1[m] can be based in part on another listed input and that each input must be distinct. That the PTAB did not consider this to be a claim construction was not dispositive according to the CAFC. The CAFC further supported its conclusion by noting that the PTAB’s decision cites cases relating to claim construction in support of its conclusion that limitation 1[m] was not disclosed in the prior art.
The CAFC next concluded that the PTAB’s construction of limitation 1[m] did not violate the APA but was erroneous. With respect to the APA, the CAFC explained that while an explicit construction of limitation 1[m] was not proposed by either party during trial, both parties recognized that the core issue related to the scope and boundaries of the five inputs enumerated in 1[m] and, thus, were afforded both notice and opportunity to address this issue during trial. With respect to the PTAB’s construction itself, the CAFC concluded that the PTAB wrongly relied on CAFC precedent as establishing a per se rule that separately listed claim elements are distinct components. The CAFC found that the express language of limitation 1[m]—namely “based at least in part on”—supports a broad construction in which certain claimed inputs may be used to compute others, as appellant argued at trial. The CAFC further noted that the specification contemplates an embodiment in which one claimed input is calculated based on at least one other claimed input.
Accordingly, the CAFC reversed and remanded with instructions that the PTAB construe limitation 1[m] so as to allow for any of the five claimed inputs to be used to calculate another claimed input.
