In Fitbit, Inc. v. Valencell, Inc., Appeal 2019-1048 (Fed. Cir. July 8, 2020), the Federal Circuit determined that Fitbit, who had successfully sought joinder in an IPR petition filed by Apple, had standing to appeal an adverse determination as to certain patent claims, despite Fitbit's failure to join that portion of Apple's Petition. The Federal Circuit went on to rule that the PTAB had erred in rejecting Apple's arguments as to those claim, and remanded the matter to the Board for further review.
Apple petitioned for review of claims 1-13 of U.S. Patent No. 8,923,941, entitled "Methods and Apparatus for Generating Data Output Containing Physiological and Motion-Related Information." The '941 Patent concerned systems for obtaining and monitoring information such as blood oxygen level, heart rate, and physical activity. The Board instituted review on claims 1, 2, and 6-13, but denied review of claims 3-5. Fitbit filed an IPR Petition challenging claims 1, 2 and 6-13 and successfully moved for joinder with Apple's petition.
Following trial before the Board, but before issuance of the Board's Final Written Decision, the U.S. Supreme Court rendered its decision in SAS Institute, Inc. v. Iancu, 138 S. Ct. 1348 (2018), holding that all challenged claims must be reviewed if review is granted. The Board thereupon re-instituted review of claims 3-5, conducted further proceedings, and ultimately issued a Final Written Decision finding claims 1, 2 and 6-13 unpatentable, while holding that claims 3-5 were not unpatentable. Apple withdrew from the proceedings, but Fitbit appealed the Board's decision as to claims 3-5.
The Federal Circuit rejected Valencell's arguments that Fitbit did not have the right to appeal the Board's determination with respect to claims 3-5. The Court held that Fitbit's rights as a joined party applied to the entirety of the proceedings and included the right of appeal. The Court cited language from 35 U.S.C. §319 which provided that "[a]ny party to the inter partes review shall have the right to be a party to the appeal" of any final written decision with which it is dissatisfied. The Federal Circuit offered no further analysis of Valencell's arguments that Fitbit had waived its right to challenge claims 3-5 by not including them in its own petition.
Having determined that Fitbit could properly appeal the Board's decision with respect to claims 3-5, the Federal Circuit concluded that the Board's decision finding those claims not unpatentable was error. With respect to claim 3, the Court faulted the Board for ending its analysis after rejecting the claim construction proffered in Apple's Petition. The Board had declared that Petitioner's -Apple's-assertions challenging claim 3 were based on a rejected claim construction and because "the evidentiary support relied upon [for invalidity] is predicated upon the same," was not persuaded that Apple had "shown by a preponderance of the evidence that claim 3 is rendered obvious." While the Federal Circuit agreed with the Board's construction of the claim, it nevertheless determined that the Board was required to assess the patentability of the claims against the prior art references using that construction.
As to claims 4 and 5, the Board concluded it could not determine the meaning of those claims because a claim term lacked antecedent basis. The parties agreed that there was an error in the claim's recited dependency that arose when the allowed claims were renumbered. Rather than referring to claim 3, claims 4 and 5, as issued, indicated that they depended from claim 1. Claim 1 contained no reference to "the application" recited in claim 4 and 5.
The Federal Circuit concluded that the Board was empowered to correct such errors in the course of IPR proceedings. The Court pointed to the Board's express power to amend claims during IPRs, and the precedent allowing District Courts to do so. The Court disagreed with the Board that the intended meaning of the claims was subject to reasonable debate, and determined that the Board had erred in declining to accept the parties' uniform position that the claim mistakenly recited dependence from claim 1, rather than claim 3. The Court vacated the Board's decision based upon the lack of antecedent basis, and remanded for a determination of the patentability of the corrected claims.
The Board's efforts to short-cut its analysis of the patentability of the claims clearly irked the Court. Fitbit was fortunate that it was able to gain admission to the Federal Circuit despite the absence from its petition of challenges to the only claims that had survived the Board's review.
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