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Sony Corp. v. Iancu

Appellate Jurisdiction for Patent Owner’s IPR Appeal, Notwithstanding Patent Expiration and Litigation Settlement

Sony Corp. v. Iancu, __ F.3d __, 2019 WL ___ (Fed. Cir. May 22, 2019) (Prost, DYK, Newman (dissenting)) (PTAB) (3 of 5 stars)

Fed Cir vacates IPR obviousness cancellation. Sony’s patent relates to a playback device that can select which channel (e.g., language track) of a “recording medium” to play based on a default value stored in nonvolatile memory. The court has jurisdiction under 28 § 1295(a)(4)(A) notwithstanding that the patent is now expired, the petitioner (ARRIS Global) has since settled with Sony, companion litigation ended, and ARRIS is not a participant in the appeal. The opinion notes that the parties remain adverse and “no party has suggested the lack of an Article III case or controversy.” Op. at 5 n.1. Per Genetics Institute, 655 F.3d 1291 (Fed. Cir. 2011), an expired patent may form the basis for a patent damages action.

The PTAB erred in construing “reproducing means.” It was not disputed that § 112, ¶ 6 applied, and the parties agreed as to the function being claimed. The PTAB’s error was in assessing that the claimed structure was not computer-implemented, and so did not require disclosure of an implementing algorithm. The opinion describes how the description of a “synthesizer” as part of the implementing means, and other considerations, meant that the term “is necessarily construed as computer-implemented based on the specification.” Op. at 9. The opinion goes on to determine that a flowchart algorithm in the patent was the necessary algorithm. On remand, the Board should consider whether the cited references include the necessary disclosure to support an obviousness determination.

Dissent: Judge Newman would have dismissed the appeal for lack of Article III standing. “There is no interest, neither private interest nor public interest, in the fate of this patent.” Dissent at 1. She criticizes the majority for finding a live controversy, when the record does not demonstrate one.

KEYWORDS: APPELLATE STANDING; ARTICLE III; INTER PARTES REVIEW; OBVIOUSNESS; MEANS-PLUS-FUNCTION