Before Stoll, Chen, and Moore. Appeal from the Patent Trial and Appeal Board.
Summary: The PTAB’s obviousness determination must meet the Administrative Procedure Act’s requirements to be upheld on appeal.
Intel Corp., et al., (“Intel”) petitioned for inter partes review (“IPR”) of a patent owned by Alacritech, Inc. (“Alacritech”). Intel asserted that the challenged claims would have been obvious over the prior art. In a pair of final written decisions the Patent Trial and Appeal Board (“Board”) found the challenged claims unpatentable as obvious. Alacritech appealed.
On appeal, Alacritech argued that the Board’s analysis was inadequate to support its findings that the asserted prior art teaches or suggests the limitations in the patent claims. The Federal Circuit agreed with Alacritech, vacating and remanding the Board’s obviousness determination, while affirming the Board’s decisions in all other respects. The Federal Circuit reviewed the adequacy of the Board’s obviousness finding under the Administrative Procedures Act’s (“APA”) requirement that the Board’s decisions be supported by adequate reasoning and evidence. The Federal Circuit emphasized that the Board’s findings need not be perfect, but must be “reasonably discernable.” Here, the Federal Circuit found the Board dedicated only two paragraphs to the parties’ arguments and, in doing so, “misapprehend[ed] both the scope of the claims and the parties’ arguments.” The Federal Circuit also rejected Intel’s argument that it should prevail because the Board adopted its argument and rejected Alacritech’s arguments. Rather, because the Board’s decision appeared to be untethered to either parties’ position, the Federal Circuit declined to infer that the Board adopted Intel’s position.