Some PTO Reexamination Rejections of NTP's Patent Portfolio Reversed, But Cloud Remains

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NTP Inc.—the patent holder that won a huge settlement against BlackBerry service provider Research in Motion Ltd.—can return to the Patent and Trademark Office to try to save a few of its hundreds of patent claims on wireless e-mail technology, the U.S. Court of Appeals for the Federal Circuit ruled Aug. 1 in two separate fact-intensive opinions.

In the first case, the court made decisions on seven of the patents the Board of Patent Appeals and Interferences had found invalid on reexamination, reversing the board on key claim construction terms that might allow NTP more flexibility on remand (In re NTP Inc., Fed. Cir., No. 10-1277, 8/1/11).

The eighth and most recent patent was the subject of the second case, in which the court affirmed the BPAI's judgment that NTP could not claim priority back far enough in its patent application chain to overcome anticipation of all 764 claims by a prior art patent (In re NTP Inc., Fed. Cir., No. 10-1243, 8/1/11).

Although the second case was driven by specific facts to an extent as well, the court added to its jurisprudence on reexamination proceedings, concluding that limitations on the PTO to only consider “substantial new question[s] of patentability” do not bar a review of priority arguments that could have, but were not, determined in the original patent prosecution.

NTP is also litigating in the U.S. District Court for the Eastern District of Virginia against a number of other alleged infringers, including Apple Inc., Google Inc., Microsoft Corp., and wireless network providers Alltel Corp., AT&T Mobility LLC, Sprint Nextel Corp., T-Mobile USA Inc., and Verizon Communications Inc. It is unclear whether the claims that would be litigated in those lawsuits are good prospects for validity findings by the PTO on remand. However, NTP's complaint against Microsoft, for example, cited all eight patents and claimed that the same eight were asserted against the wireless network providers.

RIM Settles With NTP, But Reexamination Continues

NTP originally filed for a patent in May 1991 on the integration of electronic mail with radio frequency wireless transmission. Through a series of continuations, eight patents (5,436,960; 5,438,611; 5,479,472; 5,625,670; 5,631,946; 5,819,172; 6,067,451; and 6,317,592) emanating from that original disclosure are at issue in the instant case.

NTP sued BlackBerry system provider Research in Motion Ltd. for patent infringement, leading to a Federal Circuit decision in August 2005 in favor of NTP. NTP Inc. v. Research in Motion Ltd., 418 F.3d 1282, 75 USPQ2d 1763 (Fed. Cir. 2005).

During that proceeding, RIM filed reexamination requests on the eight patents. The conduct of the reexamination was controversial, as NTP alleged that senior PTO officials engaged in improper communications and meetings with RIM, responding to other agencies' concerns given the prevalence of BlackBerry use by government employees (118 PTD, 06/20/06).

NTP and RIM reached a $612 settlement deal (43 PTD, 03/6/06); however, the PTO continued with the reexamination.

The PTO's Board of Patent Appeals and Interferences affirmed an examiner's rejections of hundreds of contested claims as either anticipated by or obvious in light of prior art. The board also ruled that NTP could not antedate certain reference with uncorroborated inventor testimony in Rule 131 affidavits, per 37 C.F.R. §1.131(b). As to the ‘592 patent, the BPAI further decided that NTP could not claim priority back to the May 1991 original application filed.

NTP filed eight appeals, one for each patent.

Term Constructions Vacated as to All Claims

Judge Arthur J. Gajarsa wrote the opinion for the court as to all but the last, ‘592 patent, providing a detailed review of mostly fact-specific rulings. The court first reversed the board as to its claim construction decisions on the terms, “electronic mail message” and “electronic mail system,” which were relevant to all claims in suit.

To distinguish its claims from prior art, NTP argued that the “message” should be construed to include an identification of the originating mail processor and a message subject. The board's broader construction, eliminating those two elements, allowed prior art on technologies such as pager messages to invalidate NTP's patents. The court rejected the board's construction in light of information in the “Background Art” section of the patent specification.

As to the “electronic mail system,” the court readily vacated the board's view that the system did not require “a plurality of originating processors,” since the claims themselves specifically cited a “plurality.”

Swearing Behind References Fails

However, the modifications to the construed terms did not eliminate all prior art from consideration for anticipation and obviousness analyses, and the court's decisions on those board judgments were mixed.

First, NTP tried to swear behind a number of references. Two inventors filed affidavits alleging a reduction to practice earlier than the critical date in October 1990, seven months before the application was filed. The court rejected every attempt by NTP to corroborate the inventors' statements, as required per, most recently according to the court, Medichem S.A. v. Rolabo S.L.,437 F.3d 1157, 77 USPQ2d 1865 (Fed. Cir. 2006) (26 PTD, 02/8/06).

A key question was whether NTP could show support for e-mail handling prior to the critical date versus “messaging” only, such as to pagers. The court concluded that NTP was using “circular logic” whereby the inventors' own testimony was being asserted to be the corroborating evidence.

Norwegian Library Reference Allowed

NTP next fought a particularly damaging “Telenor” reference, a printed publication titled “Mobile Data Networks Description” available at a university library in Trondheim, Norway. Telenor was available more than one year prior to the critical date for the patents at issue, so it was relevant regardless of the decision as to swearing behind the other references. NTP argued that it was neither authentic nor reasonably accessible so as to qualify as prior art under Section 102(b).

The court, however, affirmed the board on both authenticity and accessibility, primarily in light of a 1986 Federal Circuit ruling that a single thesis catalogued and shelved in Germany was qualifying prior art under Section 102(b), In re Hall, 781 F.2d 897, 228 USPQ 453 (Fed. Cir. 1986).

Mixed Anticipation, Obviousness Decisions

The court then looked at Telenor and other prior art in its anticipation and obviousness analyses.

First, the court reversed the board's obviousness rejection as to “several of the patents at issue,” including at least the ‘960 patent, for improperly combining references and relying on “hindsight reasoning to piece together elements to arrive at the claimed invention.” Use of another reference was a question the board must consider on remand, the court said, in light of the new claim construction decisions. That reference implicated “a number of claims” that the court did not explicitly identify.

The Telenor reference, though, was most damaging to NTP's claims, as the court rejected NTP's argument that Telenor was not a sufficiently enabled disclosure. On the other hand, some of the patents' dependent claims are directed to systems that bundle messages from multiple sources into a single “packet” for transmission, and the court reversed the board's judgment that the Telenor reference disclosed transmission in packets.

Nevertheless, one more reference cut against NTP, at least with respect to the ‘451 and ‘960 patents. The court affirmed the board's findings that a system node that receives information and makes it available for delivery does some “processing,” even though no computer application program is specifically identified, and that a “pseudo-IP address” is adequate teaching to meet a radio frequency identification limitation in the contested patents.

Finally, the court said that, in its appeal briefs, NTP made other concessions as to the breadth of the prior art. Given that the revised construction of the “electronic mail message” and “electronic mail system” terms “is relevant to many of the bases for [the board's] rejection,” the court remanded, but with instructions that the company is bound by its concessions on remand.

Judge Kimberly Ann Moore and Senior Judge Raymond C. Clevenger III joined the opinion.

Board's Priority Decision Upheld in Second Case

Moore wrote the opinion of the court, joined by the other two judges, as to the ‘592 patent. Again, the issue was whether NTP could antedate a prior art reference, this time the “Lazaridis” patent (6,219,694), and this time by trying to claim priority to the original 1991 application. The BPAI ruled, and NTP did not dispute, that Lazaridis anticipates all 764 claims of the ‘592 patent if NTP can claim priority only to its 1999 filing date.

NTP instead contested one of the board's claim construction decisions. After construing the term “destination processor” in the ‘592 patent, the board concluded that the 1991 application failed to provide supporting written description of the claims, under 35 U.S.C. §112.

The court acknowledged that, under NTP's preferred construction of the term, the original application provided the necessary support for the claims. However, the court affirmed the BPAI's construction in light of the ‘592 patent's written description.

The issue was whether the destination processor's functions could be construed, as NTP argued, to coincide in part with two other elements of the system, a gateway switch and an interface switch. The court rejected that view from the clear separation of the functions in the specification. The court further upheld the board's discretion in discounting NTP's expert's declaration to the contrary, supporting the BPAI's view that “the expert's declaration was not premised on a proper claim construction analysis.”

Priority Analysis in Reexam Not Prohibited

NTP further argued that the board was statutorily barred from performing its priority analysis under 35 U.S.C. §§301 and 303(a). Because reexamination is limited to any “substantial new question of patentability,” per Section 303(a), NTP argued, the examiner was prohibited from making a priority determination.

The court characterized NTP's argument as, essentially, requiring the examiner to accept the applicant's argument in favor of an earlier priority date without challenge. Rejecting NTP's reliance for support of its argument on a district court case, Patlex Corp. v. Quigg, 680 F. Supp. 33, 6 USPQ2d 1296 (D.D.C. 1988), the court held, “Nothing in 35 U.S.C. §§301 et seq. entitles a patentee to a claim of right to its earliest priority date.”

Rather, the court said, claims to an earlier priority date must meet the requirements of Section 120. “Otherwise, the examiner would be stripped of a critical legal tool needed in performing a proper reexamination.”

Finally, NTP argued that even if that were so, the PTO had already considered, implicitly, the Section 112 written description requirement in light of the 1991 application when the first examiner conducted the original ‘592 patent prosecution.

The court rejected that argument as well, first as to whether the Section 112 analysis could be presumed by requirements of the PTO's Manual for Patent Examination Procedures, or MPEP. After Congress amended Section 303(a) of the Patent Act in 2002, the court noted, a prior Federal Circuit concluded, in In re Swanson, 540 F.3d 1368, 88 USPQ2d 1196 (Fed. Cir. 2008), that, in reexamination, there is no “presumption of full consideration” by the original examiner. “Thus, there is no presumption that the examiner considered whether the written description of the Parent Application supports the claims of the ‘592 patent simply because the MPEP requires it.”

The analysis of whether the examiner considered the Section 112 issue is context-specific, therefore, the court said, and it proceeded to look in detail at the record of the original prosecution. “[T]here is no evidence that the examiner actually considered whether the claims of the ‘592 patent satisfy the requirements of §112,” the court said, as it distinguished a case where “the issue was squarely before the examiner,” In re Recreative Technologies Corp., 83 F.3d 1394, 1398, 38 USPQ2d 1776 (Fed. Cir. 1996).

In the instant case, the court said, “The examiner issued no rejection based on §112, nor did the examiner make an affirmative statement that the claims of the ‘592 patent satisfied §112, as the examiner did in Patlex.”

The court thus affirmed the BPAI's judgments invalidating all the claims of the ‘592 patent.

Brian M. Buroker of Hunton & Williams, Washington, D.C., represented NTP. PTO Associate Solicitor William LaMarca represented the agency.

By Tony Dutra

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