Federal Circuit Holds That Statements Made In IPRs Can Lead To Prosecution Disclaimer

In Aylus Networks, Inc. v. Apple, Inc., No. 16-1599 (Fed. Cir. May 11, 2017) (“Federal Circuit Op.”), the Federal Circuit affirmed the district court’s decision that Apple did not infringe Aylus’s patents.  See Aylus Networks, Inc. v. Apple Inc., No. 13-cv-04700-EMC, 2016 WL 270387 (N.D. Cal. Jan. 21, 2016) (“District Court Op.”).  The district court’s decision rested, in part, on finding that Aylus had disclaimed certain embodiments in its preliminary response to Apple’s request for inter partes review.

Aylus’s patent is directed towards improving digital home networks for streaming and displaying media content.  One of the aspects of the invention is a control point proxy (“CPP”) logic that negotiates media-content delivery with a media server or media renderer.  The claims require that “CPP logic” be invoked to negotiate media content delivery and the district court construed this to require “that only the CPP logic is invoked to negotiate media content delivery.”  District Court Op. at *4 (emphasis added).  Based on this construction, the district court granted Apple’s motion for summary judgment of non-infringement.  Id. at *7.

The district court premised its construction on a number of factors, including claim differentiation, the disclosure in the specification, the PTAB’s decision in denying Apple’s petition for inter partes review and, most critically for the appeal, Aylus’s statements in its preliminary response to the petition, which the district court concluded were “akin to a prosecution disclaimer.”  Id. at *4-6.  Specifically, in its preliminary response Aylus argued that its claims were patentable over the prior art because “only the CPP is invoked to negotiate media content delivery.”  Id. at *5 (quoting Aylus response); see id. (quoting other similar statements).

On appeal, Aylus first argued that statements made during inter partes review proceedings cannot lead to prosecution disclaimer.  The Federal Circuit disagreed.  It is settled law that statements made in reissue and reexamination proceedings can lead to prosecution disclaimer.  Federal Circuit Op. at 10 (citing cases).  The Federal Circuit held that disclaimer should likewise apply to statements made in inter partes review:  This would likewise “ensure that claims are not argued one way in order to maintain their patentability and in a different way against accused infringers” and would allow the public to rely on the patentee’s “definitive statements.”  Id. at 10-11 (citations omitted).  Aylus unsuccessfully contended that inter partes review is more similar to district court proceedings, which do not lead to prosecution disclaimer, than to other Patent Office procedures.  Id. at 11.  The Federal Circuit rejected this analogy, citing the Supreme Court’s recent decision in Cuozzo Speed Technologies, LLC v. Lee, which detailed ““significant respects, [in which] inter partes review is less like a judicial proceeding and more like a specialized agency proceeding.’”  Id. (quoting Cuozzo, 136 S. Ct. 2131, 2143 (2016)).  The Federal Circuit also noted that many district courts have already applied prosecution disclaimer in this way.  Id. at 12 (citing cases).

The Federal Circuit also rejected Aylus’s argument that statements made in a preliminary response are not part of the inter partes review proceedings.  Such statements, the Federal Circuit explained, are “official papers filed with the PTO and made available to the public,” and, in such responses, the patentee “can define claim terms and otherwise make representations about claim scope to avoid prior art.”  Id. at 13-14.  The public is therefore entitled to rely on such statements.

The Federal Circuit’s decision emphasizes the importance of being careful in describing your invention to the Patent Office.  Anything you say may be used against you in a court of law.  Aylus learned this the hard way.