Paper No. 34
`
`Trials@uspto.gov
`571.272.7822 Entered: June 25, 2018
`
`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`____________
`
`TERADATA OPERATIONS, INC.,
`Petitioner,
`
`v.
`
`REALTIME DATA LLC,
`Patent Owner.
`____________
`
`Case IPR2017-00557
`Patent 7,358,867 B2
`____________
`
`
`
`Before GREGG I. ANDERSON, CHARLES J. BOUDREAU, and
`JASON J. CHUNG, Administrative Patent Judges.
`
`ANDERSON, Administrative Patent Judge.
`
`
`
`FINAL WRITTEN DECISION
`35 U.S.C. § 318(A) AND 37 C.F.R. § 42.73
`
`
`
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`IPR2017-00557
`Patent 7,358,867 B2
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`
`
`
`I. INTRODUCTION
`
`Teradata Operations, Inc. (“Petitioner”) filed a Petition (Paper 1
`(“Pet.”)) pursuant to 35 U.S.C. §§ 311–319 to institute an inter partes
`review of claims 16–19, 32, 34, and 35 (“the challenged claims”) of U.S.
`Patent No. 7,358,867 B21 (“the ’867 patent,” Ex. 1001). Pet. 2. The Petition
`was supported by the Declaration of Charles D. Creusere, Ph.D. (“Creusere
`Declaration,” Ex. 1002). Realtime Data LLC (“Patent Owner”) filed a
`Preliminary Response (“Prelim. Resp.,” Paper 10). We instituted an inter
`partes review of the challenged claims (“Institution Decision” or “Inst.
`Dec.,” Paper 14). We issued an Institution Correction Order in which we
`instituted on additional grounds asserted in the Petition but not instituted in
`the Institution Decision (“Inst. Cor. Order,” Paper 29). See SAS Inst., Inc. v.
`Iancu, 2018 WL 1914661, at *10 (Apr. 24, 2018) (“SAS”).
`Patent Owner filed a Response (“PO Resp.,” Paper 19), and Petitioner
`filed a Reply (“Pet. Reply,” Paper 21). Patent Owner’s Response is
`supported by the Declaration of Kenneth A. Zeger, Ph.D. (“Zeger
`Declaration,” Ex. 2003). Dr. Creusere was deposed by Patent Owner.
`(“Creusere Deposition,” Ex. 2002). Dr. Zeger was deposed by Petitioner
`(“Zeger Deposition,” Ex. 1033). An oral hearing was held on February 20,
`2018, and a transcript thereof has been entered into the record (“Tr.,”
`Paper 28).
`Subsequent to the hearing and pursuant to our Order (Paper 25), both
`parties submitted additional briefing pertaining to whether Ex Parte
`
`
`1 The ’867 Patent issued on an application filed on April 8, 2006. Ex. 1001,
`22. The earliest claimed priority date for the ’867 patent is December 11,
`1998. Pet. 9 (citing Ex. 1001 (63)).
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`Schulhauser, 2016 WL 6277792, No. 2013-007847 (PTAB 2016)
`(precedential) (“Schulhauser”) applies to conditional limitations recited in
`independent method claim 16 of the ’867 patent. Paper 26 (Patent Owner),
`Paper 27 (Petitioner). Subsequent to our Institution Correction Order, we
`authorized additional briefing on the additional grounds added by the
`Institution Correction Order, specifically stating that Schulhauser should be
`addressed as it relates to the additional grounds. Paper 30, 4. Patent Owner
`filed a Supplemental Brief (“Supp. Br.,” Paper 32), and Petitioner filed a
`Reply to the Supplemental Brief of Patent Owner (Paper 33).
`The Board has jurisdiction under 35 U.S.C. § 6. This Final Written
`Decision issues pursuant to 35 U.S.C. § 318(a) and 37 C.F.R. § 42.73. For
`the reasons that follow, we determine that Petitioner has shown by a
`preponderance of the evidence that claims 16–19, 32, 34, and 35 are
`unpatentable.
`
`
`
`II. BACKGROUND
`
`A. Related Proceedings
`Petitioner advises us that the ’867 patent has been asserted against
`Petitioner in the United States District Court for the Central District of
`California in civil action No. 2:16-cv-02743. Pet. 1 (citing Exs. 1013,
`1014). Patent Owner advises us that the ’867 patent has been asserted in six
`cases filed in the United States District Court for the Eastern District of
`Texas. Paper 9, 4. Patent Owner also advises that thirty-one inter partes
`review petitions have been filed against a total of eleven patents owned by
`Patent Owner, including this proceeding. Id. at 1.
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`
`B. Background Technology and the ’867 Patent (Ex. 1001)
`The ’867 patent relates generally to data compression and
`decompression systems, including content independent and content
`dependent systems. Ex. 1001, 1:22–26.
`1. ’867 Patent Description of Technical Background
`Digital data has several advantages in the representation of
`information like speech, music, audio, images and video that appears
`naturally in analog form. Ex. 1001, 1:34–46. For example, “digital data is
`more readily processed, stored, and transmitted due to its inherently high
`noise immunity.” Id. at 1:46–48. “Data compression is widely used to
`reduce the amount of data required to process, transmit, or store a given
`quantity of information.” Id. at 1:58–60.
`Data compression may be lossy or lossless. Ex. 1001, 1:60–63.
`Lossy data compression techniques provide for “an inexact representation of
`the original uncompressed data” that “differs from the original
`unencoded/uncompressed data.” Id. at 1:64–67. Lossless data compression
`techniques provide “an exact representation of the original uncompressed
`data” that reproduces identically the original unencoded/uncompressed data.
`Id. at 2:12–16.
`Lossless compression has associated problems dependent on factors
`like “compression ratio, encoding and decoding processing requirements,
`encoding and decoding time delays, compatibility with existing standards,
`and implementation complexity and cost, along with the adaptability and
`robustness to variations in input data.” Ex. 1001, 2:20–49. “A direct
`relationship exists in the current art between compression ratio and the
`amount and complexity of processing required.” Id. at 2:49–51.
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`
`Existing methods for dealing with the above-described issues include
`content dependent techniques where file type descriptors “describe the
`application programs that normally act upon the data contained within the
`file” so that “data types, data structures, and formats within a given file may
`be ascertained.” Ex. 1001, 2:59–66. This method has limitations including
`inability to act on application programs “which do not possess published or
`documented file formats, data structures, or data type descriptors.” Id. at
`3:1–3.
`Another technique includes a pre-compression phase where a data
`stream is accepted and the data type identified. Ex. 1001, 3:11–23. Then a
`data compression method is selected for compression “with the intention of
`producing the best available compression ratio for that particular data type.”
`Id. at 3:24–28. The limitations of this method include “the need to
`unambiguously identify various data types” including common data types
`like ASCII, binary, or Unicode. Id. at 3:30–32. However, there are data
`types that fall outside these three most common data types. Id. at 3:32–34.
`2. The ’867 Patent’s Disclosure
`The ’867 patent seeks to address the limitations of “conventional data
`compression techniques as described above.” Ex. 1001, 3:45–47; see
`Section I.B.1 above. Accordingly, the ’867 patent describes “systems and
`methods for providing fast and efficient data compression using a
`combination of content independent data compression and content
`dependent data compression.” Ex. 1001, 3:53–54. Whatever the content
`received by the compression system, “the system processes the input data
`stream in data blocks that may range in size from individual bits through
`complete files or collections of multiple files.” Id. at 6:56–59.
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`
`An encoder module receives the data blocks from an input data buffer
`and uses different encoding techniques based on the various types of input
`data. Ex. 1001, 6:6–17, Fig. 2. Data compression is performed by encoder
`module 30, “wherein each of the encoders . . . processes a given input data
`block and outputs a corresponding set of encoded data blocks.” Id. at 7:20–
`23.
`
`In one embodiment, a compression ratio is obtained for each of the
`encoders and then compared with a first compression threshold. Ex. 1001,
`8:22–27. A determination is made as to whether or not the threshold is
`exceeded. Id. at 8:26–27, 38–41. “If there are no encoded data blocks
`having a compression ratio that exceeds the compression ratio threshold
`limit,” a negative determination in step 316 of Figure 3, then “the original
`unencoded input data block is selected for output and a null data
`compression type descriptor is appended thereto (step 318).” Id. at 8:41–52.
`“A null data compression type descriptor is defined as any recognizable data
`token or descriptor that indicates no data encoding has been applied to the
`input data block.” Id. The “unencoded input data block with its
`corresponding null data compression type descriptor is then output for
`subsequent data processing, storage, or transmittal (step 320).” Id.
`If a positive determination is made at step 316 and the “blocks possess
`a compression ratio greater than the compression ratio threshold limit,”
`“then the encoded data block having the greatest compression ratio is
`selected,” and “[a]n appropriate data compression type descriptor is then
`appended.” Ex. 1001, 8:53–58. “A data compression type descriptor is
`defined as any recognizable data token or descriptor that indicates which
`data encoding technique has been applied to the data.” Id. at 8:58–61. “The
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`encoded data block having the greatest compression ratio along with its
`corresponding data compression type descriptor is then output for
`subsequent data processing, storage, or transmittal.” Id. at 8:66–9:3.
`
`16[B]
`
`C. Illustrative Claim
`Of the challenged claims, method claim 16 is the only independent
`claim. Claims 17, 32, 34, and 35 depend from claim 16, and claims 18 and
`19 depend from claim 17. Claim 16 is reproduced below.
`16[A]2 A method comprising: receiving a plurality of data
`blocks;
`determining whether or not to compress each one of
`said plurality of data blocks with a particular one or
`more of several encoders;
`if said determination is to compress with said
`particular one or more of said several encoders for a
`particular one of said plurality of data blocks;
`16[C2] compressing said particular one of said plurality of
`data blocks with said particular one or more of said
`several encoders to provide a compressed data block;
`16[C3] providing a data compression type descriptor
`representative of said particular one or more of said
`several encoders;
`
`16[C1]
`
`
`2 Petitioner identifies limitations with the claim number and a letter in
`brackets, e.g., “16[A]” for the first limitation of claim 16. Pet. 16. Patent
`Owner adopts the same nomenclature but further breaks down some
`limitations, e.g., “16[C1]” for the first part of the limitation identified by
`Petitioner as limitation “16[C]” and “16[C2]” for the second part of the
`limitation. PO Resp. 7. We adopt Petitioner’s nomenclature as modified by
`Patent Owner for purposes of this Decision.
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`
`16[D1]
`
`16[C4] outputting said data compression type descriptor and
`said compressed data block;
`if said determination is to not compress said particular
`one of said plurality of data blocks;
`16[D2] providing a null data compression type descriptor
`representative of said determination not to compress;
`and
`16[D3] outputting said null data compression type descriptor
`and said particular one of said plurality of data blocks.
`Ex. 1001, 28:9–30.
`
`D. References
`Petitioner relies on the following references:
`1. W.H. Hsu, et al., Automatic Synthesis of Compression Techniques
`for Heterogeneous Files, 25(10) Software Practice & Experience 1097–1116
`(1995) (“Hsu,” Ex. 1005).
`2. U.S. Patent No. 5,870,036 to Franaszek et al., issued February 9,
`1999 (“Franaszek,” Ex. 1006).
`3. U.S. Patent No. 5,097,261 to Langdon, Jr. et al, issued March 17,
`1992 (“Langdon, Jr.,” Ex. 1007).
`The Petition also relies on the Creusere Declaration to support the
`various contentions.
`E. Grounds upon Which Trial Was Instituted
`Trial was instituted on the following grounds:
`1. Claims 16, 32, 34, and 35 as anticipated under section 1023 by Hsu.
`
`
`3 The Leahy-Smith America Invents Act (AIA), Pub. L. No. 112-29, 125
`Stat. 284, 285–88 (2011), which revised 35 U.S.C. §§ 102 and 103, became
`effective March 16, 2013. The ’867 patent has an effective filing date of
`December 11, 1998, prior to the effective date of the AIA. Pet. 9 (citing
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`
`2. Claims 17 and 18 as obvious under section 103 over Hsu.
`3. Claims 16–19, 32, 34, and 35 as anticipated under section 102 by
`Franaszek.
`4. Claims 16–19, 32, 34, and 35 as obvious under section 103 over
`Franaszek.
`5. Claims 17, 18, and 32 as obvious under section 103 over Hsu in
`view of Franaszek.
`6. Claim 19 as obvious under section 103 over Hsu in view of
`Langdon, Jr.
`7. Claim 19 as obvious under section 103 over Hsu in view of
`Franaszek and Langdon, Jr.
`8. Claims 16–19, 32, 34, and 35 as obvious under section 103 over
`Franaszek and Langdon, Jr.
`9. Claims 16–19, 32, 34, and 35 as obvious under section 103 over
`Franaszek in view of Hsu.
`10. Claim 19 as obvious under section 103 over Franaszek, Hsu, and
`Langdon, Jr.
`Inst. Dec. 38–39, Inst. Cor. Order 2–3.
`III. ANALYSIS
`
`
`
`A. Claim Construction
`In inter partes review, claim terms are given their broadest reasonable
`interpretation in light of the specification in which they appear. Cuozzo
`Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2144–46 (2016); 37 C.F.R.
`§ 42.100(b). We presume that claim terms have their ordinary and
`
`Ex. 1001 (63)). Thus, the grounds asserted are under the pre-AIA version of
`§§ 102 and 103.
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`customary meaning. See Trivascular, Inc. v. Samuels, 812 F.3d 1056, 1061–
`62 (Fed. Cir. 2016) (“Under a broadest reasonable interpretation, words of
`the claim must be given their plain meaning, unless such meaning is
`inconsistent with the specification and prosecution history.” (citation
`omitted)); In re Translogic Tech., Inc., 504 F.3d 1249, 1257 (Fed. Cir.
`2007). Any special definition for a claim term must be set forth in the
`specification with reasonable clarity, deliberateness, and precision. In re
`Paulsen, 30 F.3d 1475, 1480 (Fed. Cir. 1994). In the absence of such a
`special definition or other consideration, “limitations are not to be read into
`the claims from the specification.” In re Van Geuns, 988 F.2d 1181, 1184
`(Fed. Cir. 1993).
`Only those terms that are in controversy need to be construed and only
`to the extent necessary to resolve the controversy. See Nidec Motor Corp. v.
`Zhongshan Broad Ocean Motor Co., 868 F.3d 1013, 1017 (Fed. Cir. 2017)
`(citing Vivid Techs. Inc. v. Am. Sci. & Eng’g, Inc., 200 F.3d 795, 803 (Fed.
`Cir. 1999)). Petitioner proposes two terms for construction, which we
`construed in the Institution Decision, repeating those constructions at
`Sections III.A.2 and 3 below. See Inst. Dec. 10–11. Patent Owner does not
`propose any term for construction, arguing construction is “unnecessary to
`resolve the controversy.” PO Resp. 6.
`For continuity of the record, we repeat our constructions from the
`Institution Decision below at sections III.A.1 through 3. At the oral hearing,
`for the first time, we raised a question about the application of Schulhauser
`to the conditional limitation 16[B], “whether or not to compress . . . with a
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`particular one or more of several encoders.” Tr. 22:20–26:2. The
`construction of limitation 16[B] is discussed in Section III.A.4 below.
`1. “each one” or “particular one” (claim 16)
`In the Institution Decision, we construed “each one” or “particular
`one.” Inst. Dec. 7–10. We determined that no construction beyond the plain
`meaning of the claim was required and that a “data block” may be made up
`of multiple “data blocks.” Id. at 10.
`In its Preliminary Response, Patent Owner argued limitations of claim
`16 should be construed to require “block-by-block” compression not
`disclosed in Hsu. Prelim. Resp. 18–29. Patent Owner contended Hsu
`“describes a different approach that groups multiple data blocks together and
`outputs a compression history only once it has compressed an entire file.”
`Id. at 19. Focusing on the claim language “each one” and “particular one” in
`limitations 16[C1–C4] and 16[D1–D3], Patent Owner’s argument was
`based, in principal part, on reading claim 16 as a whole to mean “block-by-
`block.” See id. at 21–22.
`In its Response, Patent Owner does not restate its “block-by-block”
`argument. Neither does Patent Owner challenge our interpretation of “each
`one” or “particular one.” Patent Owner does argue that Hsu has not been
`shown to disclose “[c]laim 16’s limitations [that] repeatedly recite ‘data
`blocks.’” PO Resp. 7. We address the “data block” argument in the
`Response later in this Decision (see Section III.B.1.b(3)(a) below) but
`remain unpersuaded by the “block-by-block” argument. In any event, Patent
`Owner has waived this specific argument.4 Further, because the argument is
`
`
`4 See Scheduling Order, 3, Section 2.a, Paper 15 (“The patent owner is
`cautioned that any arguments for patentability not raised in the
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`not repeated in the Response, the construction of “each one” or “particular
`one” is no longer disputed. Thus, we maintain our determination from the
`Institution Decision that no construction beyond the claim language is
`required and that a “data block” may be made up of multiple “data blocks.”
`Inst. Dec. 10.
`2. “a data compression type descriptor” (claims 16 & 17)
`Petitioner identifies two terms for construction, “a data compression
`type descriptor” and “a null data compression type descriptor.” Pet. 16.
`Patent Owner asserts that the terms are irrelevant to the contested issues. PO
`Resp. 5–6. Patent Owner argues the terms construed are not in dispute and
`its “Response assumes arguendo that Petitioner’s proposed constructions are
`correct.” Id. at 6 (citing, inter alia, Vivid Techs., 200 F.3d at 803).
`“A data compression type descriptor is defined as any recognizable
`data token or descriptor that indicates which data encoding technique has
`been applied to the data.” Ex. 1001, 8:58–61. This definition from the
`Specification is stated clearly and with precision, proposed by Petitioner, not
`objected to by Patent Owner, and adopted herein. See Pet. 16; see also In re
`Paulsen, 30 F.3d at 1480 (definitions in the Specification are followed if
`stated with “reasonable clarity, deliberateness, and precision”).
`3. “a null data compression type descriptor” (claims 16 & 17)
`“A null data compression type descriptor is defined as any
`recognizable data token or descriptor that indicates no data encoding has
`been applied to the input data block.” Ex. 1001, 8:46–49. As with “a data
`
`
`response may be deemed waived.”).
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`compression type descriptor,” this definition comes from the Specification
`and is adopted herein. See Pet. 16.
`4. “whether or not to compress . . . with a particular one or more of
`several encoders” (claims 16 & 17)
`Limitation 16[B] recites a condition, i.e., “whether or not to
`compress.” Limitation 16[B] is followed by two alternatives, limitations
`16[C] and 16[D]. Limitation 16[C] applies “if said determination is to
`compress.” Limitation 16[D] applies “if said determination is to not
`compress.” Our precedential decision in Schulhauser holds that only one of
`two mutually exclusive method claim limitations, here 16[C] or 16[D], need
`be disclosed in order to meet a conditional limitation such as 16[B].
`Schulhauser at 8–9. Per our order (Paper 25), both parties briefed the
`applicability of Schulhauser after the oral hearing. Papers 26 (Patent
`Owner), 27 (Petitioner).
`a. Does Schulhauser Apply to the Present Case
`
`Petitioner argues that Schulhauser applies and that it argued the
`holding of that case by asserting only one limitation need be shown in its
`Reply. Paper, 27, 3. Patent Owner argues that Schulhauser does not support
`unpatentability in this case and submits five reasons it should not apply here.
`Paper 26, 1. Patent Owner argues, as an initial matter, that Petitioner did not
`present timely any argument or theory based on Schulhauser and that it has
`waived the ability to present these arguments. Patent Owner argues the
`Board is foreclosed legally from now finding unpatentability based on
`Schulhauser sua sponte. Paper 26, 1–2 (citing Intelligent Bio-Sys., Inc. v.
`Illumina Cambridge Ltd., 821 F.3d 1359, 1369 (Fed. Cir. 2016); In re
`Magnum Oil Tools Int’l, Ltd., 829 F.3d 1364, 1381 (Fed. Cir. 2016); Wasica
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`Finance GMBH v. Cont’l Auto. Sys., 853 F.3d 1272, 1286 (Fed. Cir. 2017);
`Ariosa Diagnostics v. Verinata Health, Inc., 805 F.3d 1359, 1367 (Fed. Cir.
`2015); 35 U.S.C. § 554(b)(3); 77 Fed. Reg. 48,756, 48,768; 37 C.F.R.
`§ 42.23(b). Patent Owner further argues Schulhauser’s precedential
`designation pre-dates the Petition, but the Petition did not raise this issue.
`Id. at 2. Moreover, Patent Owner argues it did not have a full and fair
`opportunity to develop responsive evidence or argument. Id.
`Additionally, Patent Owner argues applying Schulhauser in the
`context of this proceeding would be arbitrary, capricious, and
`unconstitutional. Id. Patent Owner explains the Schulhauser decision arose
`in the context of a pending prosecution. Id. Patent Owner argues, in that
`setting, a patentee can address Schulhauser by simply amending claims to
`avoid limitations that will not be given patentable weight. Id.
`Furthermore, Patent Owner argues during prosecution it had no notice
`from the Office of Schulhauser or the prospect that certain limitations of its
`claims would be given no patentable weight. Id. Patent Owner argues that
`the Notice of Allowance stated the claim limitations at issue, limitations
`16[D1], 16[D2], and 16[D3], were not taught by the prior art. Id. (citing
`Ex. 1004, 660). Patent Owner argues it maintained the limitations on that
`basis, and made significant investments and expenditures to enforce and
`defend the claims. Id. According to Patent Owner, the Office must
`undertake notice and comment rulemaking to apply the rule of Schulhauser
`to IPRs, and the Office has not issued any rule, regulation, or policy
`complying with the requirements of the Administrative Procedure Act
`(hereinafter, “APA”) that extends Schulhauser to issued claims later
`challenged through inter partes review. Id. at 2–3 (citing Aqua Prods. v.
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`Matal, 872 F.3d 1290, 1319–1322, 1328 (Fed. Cir. 2017) (en banc)).
`Patent Owner argues Schulhauser is directed to prosecution entirely,
`rather than inter partes review. Paper 26, 3. Patent Owner also argues there
`is no express Congressional grant to support such retroactive rulemaking,
`and it is thus foreclosed by the APA and United States Supreme Court
`precedent. Id. (citing Bowen v. Georgetown Univ. Hosp., 488 U.S. 204,
`208–09 (1988)). In addition, Patent Owner argues that applying
`Schulhauser in this case would “violate the Due Process Clause.” PO Br. 3.
`Patent Owner argues Schulhauser only arose here after the time to bring a
`motion to amend had passed. Id. Patent Owner argues depriving the
`conditional limitations of the patentable weight that was previously afforded
`would constitute an unlawful taking. Id.
`Patent Owner also argues Schulhauser rests entirely on two non-
`precedential Federal Circuit decisions that do not support its holding, and it
`is legally incorrect. Patent Owner argues that the Board should, instead,
`direct its attention to Applera v. Illumina, 375 F. App’x 12, 21 (Fed. Cir.
`2010). Paper 26, 3–4. Patent Owner argues Applera held that all limitations
`were practiced, not that the claim could be met even if some limitations were
`never practiced. Id. at 4. Patent Owner also argues Schulhauser’s quotes
`from in Cybersettle v. National Arbitration Forum, 243 F.App’x 603, 607
`(Fed. Cir. 2007), are misplaced. Id. at 4. Patent Owner argues the broadest
`reasonable interpretation under Federal Circuit standards prohibits a
`construction that reads out limitations explicitly recited in a claim, or that
`causes the claim to read onto prior art approaches expressly taught away
`from in the specification. Id. (citing In re Suitco Surface, 603 F.3d 1255,
`1260–61 (Fed. Cir. 2010); In re Smith, 871 F.3d 1375, 1382–84 (Fed. Cir.
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`2017); In re NTP, Inc., 654 F.3d 1279, 1287–88 (Fed. Cir. 2011)).
`As an initial matter, as discussed further below, we follow
`Schulhauser because it is precedential. The Board’s Standard Operating
`Procedures (“SOP”) require it to follow its precedential decisions. PTAB
`SOP No. 2, Rev. 9, 3 (Sept. 22, 2014) (“A precedential opinion is binding
`authority in subsequent matters involving similar facts or issues.”). Even
`though Petitioner did not raise the Schulhauser issue in its Petition, we
`conclude the best course of action under these specific circumstances is to
`follow the Board’s SOP and our precedent in Schulhauser. To address APA
`concerns, due process concerns, the sufficiency of notice and potential
`prejudice, we allowed the parties the additional opportunity to brief the
`issue.5 Paper 25, 1–2. In summary, Schulhauser is our precedent and it
`should apply given its applicability to the claim construction for the claims
`at issue.
`Petitioner did not waive the conditional limitation argument.
`Although Petitioner did not cite Schulhauser in its Petition or Reply, it did
`argue that it needed only show one of the conditions in its Reply. Pet. Reply
`16–17 (arguing claim 16 only requires “either a determination to compress
`or a determination not to compress.” (emphasis added)). This argument was
`a proper reply to Patent Owner’s argument that a “particular encoder” is not
`
`
`5 Patent Owner did not identify any Federal Circuit cases that overruled
`Schulhauser. See PO Br. 3–5. Petitioner cited a related Board case. Pet. Br.
`3–4 (citing Reactive Surfaces Ltd. v. Toyota Motor Corp., Paper 60 (PTAB
`Jan. 12, 2018)). In Reactive, based on the Board’s SOP, the Board
`authorized additional briefing in a sua sponte post-hearing order to resolve
`whether Schulhauser applies to the conditional method limitations recited in
`the claims. Reactive, Paper 60. We agree with the way in which the panel
`handled the Schulhauser issue in Reactive and followed that procedure here.
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`used if the determination is not to compress. PO Resp. 17 (limitation 16[B]
`“would not be satisfied by a general determination not to compress a data
`block at all that is made independently of any particular encoder.” (emphasis
`added)).
`Patent Owner’s argument that Schulhauser arose in the context of
`prosecution such that a patentee can work around Schulhauser by simply
`amending claims to avoid limitations that will not be given patentable
`weight is unpersuasive. To the extent that Patent Owner is arguing that we
`can apply Schulhauser only to patent prosecution matters and cannot apply
`Schulhauser to an inter partes review, we disagree. First, the opinion in
`Schulhauser did not limit, explicitly or implicitly, its holding only to
`prosecution. See generally Schulhauser. Second, other panels have applied
`Schulhauser in the same situation. See Reactive, supra.
`We note Patent Owner’s statement that in the present case,
`Schulhauser only arose after the time to bring a motion to amend had
`passed. Paper 26, 2–3. Patent Owner argues Schulhauser was not an issue
`in the case until after the deadline for filing a motion to amend under our
`Scheduling Order (Paper 15). Id. at 3. This argument is not persuasive
`because at no time has Patent Owner asked for leave to file a motion to
`amend.6 Absent being presented with an amended claim, or even a
`
`
`6 The motion to amend due date is not a statutory deadline; as a result, it can
`be adjusted by the panel. See 37 C.F.R. § 42.5 (a) (“The Board may
`determine a proper course of conduct in a proceeding for any situation not
`specifically covered by this part and may enter non-final orders to administer
`the proceeding.”).
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`suggestion that one could be presented, the argument lacks relevance.
`Patent Owner’s arguments based on the evidence are addressed in our
`substantive analysis of anticipation by Hsu or Franaszek below.
`b. Application of Schulhauser
`Because we find that it is appropriate to apply Schulhauser to the
`present case for at least the reasons stated supra in § III.A.4.a, we construe
`limitation 16[B] according to the broadest reasonable construction in light of
`the specification (i.e., using Schulhauser) as explained infra. In
`Schulhauser, the Board held that, in the method claim 1 at issue in that case,
`only one of the following conditional limitations needed to be satisfied in
`the prior art to render the claim anticipated or obvious: (1) “triggering an
`alarm state if the electrocardiac signal data is not within the threshold
`electrocardiac criteria”; and (2) “determining the current activity level of the
`subject from the activity level data if the electrocardiac signal data is within
`the threshold electrocardiac criteria.” Schulhauser at 6–8. To paraphrase, in
`Schulhauser, illustrative method claim 1 recited if A, then perform step X; if
`not A, then perform step Y. Id.
`In the same manner as the cited limitations in Schulhauser, limitation
`16[B] in the present case recites “determining whether or not to compress
`each one of said plurality of data blocks.” Ex. 1001, 28:11–13. If, per
`limitation 16[C], “said determination is to compress,” then the claim
`requires “compressing,” “providing a data compression type descriptor,” and
`“outputting said compression type descriptor and said compressed data
`block.” Id. at 28:14–24. If, per limitation 16[D], “said determination is to
`not compress,” then the claim requires “providing a null data compression
`type descriptor” and “outputting said null data type compression type
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`descriptor.” Id. at 28:25–30. As a matter of law, we, therefore, find only
`one of limitations 16[C] and 16[D] needs to be satisfied in the prior art.
`Patent Owner argues the broadest reasonable construction in light of
`the specification “teaches against an approach that simply determines to
`compress data, without ever deciding to not compress data.” Paper 26, 4
`(citing Ex. 1001, 2:38–42). Patent Owner contends we “recognized the
`specification’s teachings on this point at institution.” Id. (citing Inst. Dec.
`3–4).
`The Institution Decision’s citation to column 2 is a discussion of the
`’867 patent, no more. Column 2 of the ’867 patent explains that “[a] further
`problem is that negative compression may occur when certain data
`compression techniques act upon many types of highly compressed data.”
`Ex. 1001, 2:38–40. This may “substantially expand, not compress this type
`of data.” Id. at 2:40–42. The ’867 patent simply discusses one problem that
`may result from compressing data with some unspecified technique but
`“does not teach away . . . if it merely expresses a general preference for an
`alternative invention but does not ‘criticize, discredit, or otherwise
`discourage’ investigation into the invention claimed.” See DePuy Spine, Inc.
`v. Medtronic Sofamor Danek, Inc., 567 F.3d 1314, 1327 (Fed. Cir. 2009).
`We would reach the same conclusion without applying Schulhauser.
`That is, claim 16 is construed the same with or without Schulhauser.
`Without considering Schulhauser, Figure 10a illustrates an embodiment
`teaching a