Rovalma, S.A. v. Bohler-Edelstahl Gmbh & Co. Kg ( 2017 )

United States Court of Appeals
for the Federal Circuit
______________________
ROVALMA, S.A.,
Appellant
v.
BOHLER-EDELSTAHL GMBH & CO. KG,
Appellee
______________________
2016-2233
______________________
Appeal from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in No. IPR2015-
00150.
______________________
Decided: May 11, 2017
______________________
MARC WADE VANDER TUIG, Senniger Powers LLP, St.
Louis, MO, argued for appellant. Also represented by
ROBERT M. EVANS, JR., JOHN R. SCHROEDER.
MAXWELL JAMES PETERSEN, Lewis Brisbois Bisgaard
& Smith, LLP, Chicago, IL, argued for appellee. Also
represented by THOMAS A. DOUGHERTY, Denver, CO.
______________________
Before WALLACH, TARANTO, and STOLL, Circuit Judges.
TARANTO, Circuit Judge.
2 ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG
Rovalma, S.A. owns U.S. Patent No. 8,557,056, which
describes and claims methods for making steels with
certain desired thermal conductivities. In October 2014,
Böhler-Edelstahl GmbH & Co. KG (Böhler) petitioned the
Patent Trial and Appeal Board for an inter partes review
of claims 1–4 of the ’056 patent. The Board instituted a
review based on Böhler’s construction of the claims at
issue. In its final written decision, however, the Board
rejected Böhler’s construction and adopted Rovalma’s
construction instead. Böhler had not submitted argu-
ments or evidence for unpatentability based on Rovalma’s
construction. Nevertheless, the Board determined that
Rovalma’s own submissions demonstrated that the
claims, construed as Rovalma urged, would have been
obvious to a relevant skilled artisan over the same prior
art that Böhler invoked.
Rovalma appeals. It argues both that substantial evi-
dence does not support the Board’s determination and
that the Board committed prejudicial procedural errors in
relying on Rovalma’s own submissions when determining
that the claims would have been obvious under Rovalma’s
construction. We conclude that the Board did not set
forth its reasoning in sufficient detail for us to determine
what inferences it drew from Rovalma’s submissions. We
therefore cannot determine whether the Board’s decision
was substantively supported and procedurally proper. We
vacate the Board’s decision and remand for further pro-
ceedings.
I
The ’056 patent addresses hot-work steels. It is un-
disputed that hot-work steels are used at high tempera-
tures and that the ability to conduct and thereby remove
heat—thermal conductivity—is important for such steels.
According to the patent, hot-work steels disclosed in the
prior art had thermal conductivities of approximately 16–
37 W/mK (Watts per meter-Kelvin), which were inade-
ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG 3
quate for certain applications. ’056 patent, col. 1, lines
50–52; col. 4, lines 11–14. The patent claims processes for
“setting” the thermal conductivity of a hot-work steel at
room temperature to more than 42 W/mK (higher in the
dependent claims). Id., col. 21, line 59 through col. 22,
line 64. The ’056 patent discloses an allegedly inventive
process that, to achieve such higher thermal conductivi-
ties, focuses on carbides (metal-carbon compounds) in the
steel’s matrix, or lattice, structure. Id., col. 4, lines 35–63.
The summary of the invention states that “an internal
structure of the steel is metallurgically created in a de-
fined manner such that the carbidic constituents thereof
have a defined electron and phonon density and/or the
crystal structure thereof has a mean free length of the
path for the phonon and electron flow that is determined
by specifically created lattice defects.” Id., col. 4, lines 37–
43. Alternatively, the internal structure may have “in its
carbidic constituents an increased electron and phonon
density and/or which has as a result of a low defect con-
tent in the crystal structure of the carbides and of the
metallic matrix surrounding them an increased mean free
length of the path for the phonon and electron flow.” Id.,
col. 4, lines 54–58.
The patent includes four claims. Claim 1 recites:
1. A process for setting a thermal conductivity of a
hot-work steel, which comprises the steps of:
providing a hot-work steel, including carbidic
constituents and, by weight, 2–10% Mo+W+V
[molybdenum + tungsten + vanadium];
metallurgically creating an internal structure
of the steel in a defined manner such that car-
bidic constituents thereof have at least one of
a defined electron and phonon density and a
crystal structure thereof having a mean free
length of a path for a phonon and electron flow
4 ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG
being determined by specifically created lat-
tice defects;
selecting:
a) a surface fraction and thermal conduc-
tivity of the carbidic constituents and a
particular surface fraction and thermal
conductivity of a matrix material contain-
ing the carbidic constituents; or
b) a volume fraction and thermal conduc-
tivity of the carbidic constituents and
thermal conductivity of the matrix mate-
rial containing the carbidic constituents;
and
setting the thermal conductivity of the steel at
room temperature to more than 42 W/mK.
Id., col. 21, line 59 through col. 22, line 14.
Claims 2 and 3, which depend on claim 1, require set-
ting the thermal conductivities of the steel to more than
48 and 55 W/mK respectively. ’056 patent, col. 22, lines
15–20. Claim 4, an independent claim, is similar to claim
1, but contains some different language in the “creating”
step, including a reference to a “metallic matrix” sur-
rounding the carbides. Id., col. 22, lines 21–64.
In October 2014, Böhler petitioned for inter partes re-
view of all four claims of the ’056 patent under 35 U.S.C.
§§ 311–312. In its Petition, Böhler argued that the claims
should be construed to cover the specific chemical compo-
sitions described in the specification, whether or not
created according to the process steps—“providing,”
“creating,” “selecting,” and “setting”—recited in the
claims. See Petition for Inter Partes Review 4–20, Böhler-
Edelstahl GmbH & Co. KG v. Rovalma, S.A., No.
IPR2015-00150 (P.T.A.B. Oct. 24, 2014), Paper No. 1
(Petition). Böhler argued that the claims, so construed,
ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG 5
would have been obvious over various prior-art references
that disclosed those compositions, including European
Patent No. EP 0,787,813 (EP ’813). Petition 20–59.
Böhler did not address whether the asserted prior-art
references disclosed the “providing,” “creating,” “select-
ing,” and “setting” steps of the ’056 patent’s claims. See
id. Nor did Böhler address whether those steps would
have been obvious to one of ordinary skill in the art. See
id.
In April 2015, the Board, acting as the delegate of the
Patent and Trademark Office’s Director, 37 C.F.R.
§ 42.4(a), instituted a review of the challenged claims
under 35 U.S.C. § 314. See Institution Decision, Böhler-
Edelstahl GmbH & Co. KG v. Rovalma, S.A., No.
IPR2015-00150, 2015 WL 1871000 (P.T.A.B. Apr. 22,
2015). In its decision to institute, the Board adopted
Böhler’s proposed claim construction. Id. at *3–8. Apply-
ing that construction, the Board concluded that Böhler
had established a reasonable likelihood of prevailing on
its assertion that the challenged claims would have been
obvious over the asserted prior-art references. Id. at *8–
9.
After the review was instituted, Rovalma, in its Pa-
tent Owner’s Response, argued against the claim con-
struction that the Board had relied on in instituting the
review. Patent Owner Response 19–51, Böhler-Edelstahl,
No. IPR2015-00150 (P.T.A.B. Aug. 14, 2015), Paper No.
25. Rovalma argued that the claims should be construed
to require performance of the processes recited in the
claims, not simply to cover the compositions described in
the specification. As background for its proposed claim
construction—according to Rovalma’s statement at oral
argument in this court, to counteract an enablement-
based objection to its proposed construction—Rovalma
submitted additional evidence and argument regarding
thermoprocessing.
6 ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG
Rovalma argued that a person of ordinary skill in the
art at the time of the invention, given the specification,
would have been able to predict the formation of certain
carbides based on particular heat treatments. Id. at 4.
Rovalma also argued that a person of ordinary skill would
have been able to use software tools, such as Thermo-
Calc, to carry out the needed calculations. Id. at 4–5. In
addition, Rovalma argued, based on H. Bayati & R. El-
liott, Influence of Matrix Structure on Physical Properties
of an Alloyed Ductile Cast Iron, 15 Materials Sci. & Tech.
265 (1999), that the thermal conductivity of a steel de-
pends on lattice defects and impurities. Patent Owner
Response 7. The passage of Bayati and Elliott cited by
Rovalma states that matrix structure and thermal pro-
cessing also affect thermal conductivity. See, e.g., Bayati
& Elliot, supra, at 265 (“Matrix structure is shown to play
a significant role in determining the thermal conductivity
of the ductile iron.”); id. (“Heat transport also depends on
lattice defects, microstructure, impurities, and the pro-
cessing of the metal or alloy.”).
In its Petitioner’s Reply, Böhler repeated its conten-
tion that the claims should be construed to cover chemical
compositions, not processes. Petitioner’s Reply 5–21,
Böhler-Edelstahl, No. IPR2015-00150 (P.T.A.B. Nov. 11,
2015), Paper No. 30. It did not argue, in the alternative,
that the claims would have been obvious under Rovalma’s
proposed claim construction. Nor did it address Roval-
ma’s thermoprocessing submissions, except to argue that
Rovalma’s extrinsic evidence was irrelevant to the proper
construction of the claims. See id. at 7–8.
At the oral argument, the Board extensively ques-
tioned Rovalma’s counsel about the effect of its thermo-
processing submissions on the patentability of the claims
under the claim construction urged by Rovalma. See
Record of Oral Hearing 53–87, 94–95, Böhler-Edelstahl,
No. IPR2015–00150 (P.T.A.B. Mar. 30, 2016), Paper No.
41. In particular, the Board asked Rovalma to discuss the
ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG 7
notion that it would have been obvious to create steel with
the claimed thermal conductivities in light of the prior-art
references advanced by Böhler because: (a) those refer-
ences disclosed the chemical compositions described in the
’056 patent specification; and (b) Rovalma’s submissions
showed that a person of ordinary skill in the art would
have known how to optimize those compositions to
achieve the desired properties, including thermal conduc-
tivity. See, e.g., id. at 67 (“But see, in [Bayati and Elliott]
I believe the abstract is telling us the matrix structure is
shown to play a significant role in determining thermal
conductivity of ductile iron. Why wouldn’t one of ordinary
skill in the art, given the Böhler reference and [Bayati
and Elliott], understand that the matrix structure[] is
important for thermal conductivity and you would want to
optimize it for a given composition?”).
In April 2016, the Board found the challenged claims
unpatentable. The Board rejected Böhler’s claim con-
struction, and adopted Rovalma’s. Final Written Decision
8–17, Böhler-Edelstahl, No. IPR2015-00150 (P.T.A.B. Apr.
20, 2016). Applying Rovalma’s construction, the Board
then determined that the claims would have been obvious
over “the asserted prior art as read in light of the
knowledge of the ordinarily skilled artisan.” Final Writ-
ten Decision 22; see id. at 20–22. The Board relied on
Rovalma’s own submissions for key findings about what a
relevant skilled artisan would have taken from the Böh-
ler-asserted prior art.
Specifically, the Board rejected Rovalma’s argument
that the asserted prior-art references did not disclose
setting the thermal conductivity of a steel by selecting a
surface or volume fraction of carbides or by manipulating
the steel’s microstructure in a defined manner. See id.
Instead, the Board found that a person of ordinary skill
“would have recognized that thermal processing condi-
tions affect internal structure and, thus, thermal proper-
ties of steel.” Id. at 21. The Board also found that a
8 ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG
person of ordinary skill would have been motivated to
increase the thermal conductivity of steel and would have
had a reasonable expectation of success in doing so. Id. at
22. The Board further found that a person of ordinary
skill would have “inherently completed the ‘selecting’
steps set forth in the challenged claims.” Id. To support
each of those findings, the Board relied on Rovalma’s
thermal-processing submissions and Rovalma’s state-
ments at the oral argument. See id. at 20–22.
Rovalma appeals the Board’s decision. We have juris-
diction under 28 U.S.C. § 1295(a)(4)(A).
II
We review the Board’s decisions under the Adminis-
trative Procedure Act (APA). Taking “due account . . . of
the rule of prejudicial error,” we must “hold unlawful and
set aside agency action, findings, and conclusions found to
be . . . arbitrary, capricious, an abuse of discretion, or
otherwise not in accordance with law,” “without ob-
servance of procedure required by law,” or “unsupported
by substantial evidence.” 5 U.S.C. § 706. In applying
those standards, “we will uphold a decision of less than
ideal clarity if the agency’s path may reasonably be dis-
cerned,” but “we may not supply a reasoned basis for the
agency’s action that the agency itself has not given.”
Bowman Transp., Inc. v. Ark.-Best Freight Sys., Inc., 419
U.S. 281, 285–86 (1974); SEC v. Chenery Corp., 332 U.S.
194, 196–97 (1947). Thus, the Board must, as to issues
made material by the governing law, set forth a sufficient-
ly detailed explanation of its determinations both to
enable meaningful judicial review and to prevent judicial
intrusion on agency authority. See SEC v. Chenery Corp.
318 U.S. 80, 88, 94 (1943); Personal Web Technologies,
LLC v. Apple, Inc., 848 F.3d 987, 991–93 (Fed. Cir. 2017);
In re NuVasive, Inc., 842 F.3d 1376, 1382–83 (Fed. Cir.
2016).
ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG 9
In challenging the Board’s decision in this case,
Rovalma argues both evidentiary insufficiency and proce-
dural inadequacy. We address those arguments in turn.
We conclude that a remand is advisable in both respects,
for related reasons.
A
Rovalma challenges the Board’s implicit factual find-
ings that a person of ordinary skill (1) would have appre-
ciated that the claimed thermal conductivities could be
achieved by practicing the claimed process steps, (2)
would have been motivated to increase the thermal con-
ductivities of the steels disclosed in the prior art to
achieve the claimed thermal conductivities, and (3) would
have had a reasonable expectation of success in achieving
the claimed thermal conductivities. We conclude that the
Board did not sufficiently explain the basis for its obvi-
ousness determinations to permit us to resolve the sub-
stantial-evidence issues raised by Rovalma.
The Supreme Court has recognized the importance of
clarity with respect to obviousness determinations. For
example, in KSR International Co. v. Teleflex Inc., 550
U.S. 398 (2007), the Court explained that determining
whether a person of ordinary skill would have been moti-
vated to combine known elements to arrive at the patent-
ed invention often requires a factfinder to compare the
“interrelated teachings of multiple patents; the effects of
demands known to the design community or present in
the marketplace; and the background knowledge pos-
sessed by a person having ordinary skill in the art.” Id. at
418. “To facilitate review,” the Court added, “this analy-
sis should be made explicit.” Id. We have repeatedly
insisted on such explanations in reviewing the adequacy
of the Board’s analysis—both as a matter of obviousness
law and as a matter of administrative law. We have
noted that the amount of explanation needed varies from
case to case, depending on the complexity of the matter
10 ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG
and the issues raised in the record. See Personal Web
Technologies, 848 F.3d at 991–94; Ariosa Diagnostics v.
Verinata Health, Inc., 805 F.3d 1359, 1364–67 (Fed. Cir.
2015); In re Lee, 277 F.3d 1338, 1342–46 (Fed. Cir. 2002).
In this case, the Board did not adequately explain the
basis for the findings that Rovalma challenges. The
Board found that EP ’813 and the other asserted prior-art
references expressly disclosed steel compositions “includ-
ing carbidic constituents and, by weight, 2–10%
Mo+W+V,” as required by the “providing” steps in claims
1 and 4 of Rovalma’s patent. Final Written Decision 22.
But the Board did not sufficiently lay out the basis for its
implicit findings regarding the remaining process limita-
tions. With respect to those limitations, the Board found
that a person of ordinary skill “would have at least inher-
ently completed the ‘selecting’ steps” and apparently
determined that the other steps would have been obvious
in view of Rovalma’s submissions. Id. But it did not
explain the evidentiary basis for those determinations,
and Böhler did not provide any explanation regarding the
process claim elements that the Board could adopt as its
own.
Nor did the Board adequately explain why a person of
ordinary skill in the art would have been motivated to
increase the thermal conductivities of the steels disclosed
in the prior art. Stating that EP ’813 and other asserted
prior-art references disclosed “the desirability of steels
having high thermal conductivity,” the Board found that a
person of ordinary skill “would have had reason to in-
crease the thermal conductivity of these compositions.”
Id. But the Board did not cite any evidence, either in the
asserted prior-art references or elsewhere in the record,
with sufficient specificity for us to determine whether a
person of ordinary skill in the art would have been so
motivated. As Rovalma points out, it does not necessarily
follow from prior-art disclosures of the general desirabil-
ity of high thermal conductivities that a person of ordi-
ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG 11
nary skill would have been motivated to increase thermal
conductivity beyond levels previously achieved.
Adequate explanation is also lacking for why a person
of ordinary skill in the art would have reasonably ex-
pected success in achieving the claimed thermal conduc-
tivities. The Board found that Rovalma’s submissions
disclosed that a person of ordinary skill would have
understood “heat transfer through metallic matrices and
entrained metal carbides” and “the ability to model the
effects of thermal processing on steel alloy microstruc-
ture,” and from that finding the Board inferred that a
person of ordinary skill “would have had a reasonable
expectation of success in arriving at the claimed inven-
tion.” Id. Again, however, the Board did not cite any
evidence to support the inference that a person of ordi-
nary skill would have reasonably expected to achieve the
specific thermal conductivities recited in the claims.
Without more explanation than we have, we are not
prepared to reach a bottom-line judgment on Rovalma’s
substantial-evidence challenge. The Board has not pro-
vided a sufficiently focused identification of the relevant
evidence or explanation of its inferences for us to confi-
dently review its decision and avoid usurping its fact-
finding authority. See Consolidated Edison Co. of N.Y. v.
NLRB, 305 U.S. 197, 229 (1938) (“Substantial evidence
. . . means such relevant evidence as a reasonable mind
might accept as adequate to support a conclusion.”).
Accordingly, as we have concluded in similar circum-
stances, these deficiencies call for a vacatur and remand
for further explanation from the Board. See, e.g., Icon
Health & Fitness, Inc. v. Strava, Inc., 849 F.3d 1034, 1044
(Fed. Cir. 2017); In re Van Os, 844 F.3d 1359, 1360–62
(Fed. Cir. 2017); Personal Web Technologies, 848 F.3d at
991–94; Ariosa Diagnostics, 805 F.3d at 1364–67. We
next address Rovalma’s procedural challenge.
12 ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG
B
Rovalma makes essentially two arguments in favor of
its contention that the Board committed prejudicial
procedural error. One argument is that the inter partes
review statute prohibited the Board, after adopting
Rovalma’s own claim construction, from relying on
Rovalma’s own submissions in determining that the
claims, so construed, would have been obvious over the
Böhler-asserted prior art. The other argument is that
Rovalma was denied adequate notice of and an adequate
opportunity to address the possibility that the Board
would rely on Rovalma’s submissions, as it ultimately did.
1
We reject Rovalma’s argument that the Board “ex-
ceeded its statutory authority.” Appellant’s Br. 24 (capi-
talization in heading omitted). To support that argument,
Rovalma relies entirely on In re Magnum Oil Tools Inter-
national, Ltd., 829 F.3d 1364 (Fed. Cir. 2016). That
decision, however, does not preclude the Board from
relying on a patent owner’s own submissions in determin-
ing unpatentability in the way the Board did here, as long
as the patent owner had adequate notice and an adequate
opportunity to be heard—procedural requirements that
we address in the next subsection of this opinion.
The court in Magnum Oil focused principally on the
question of whether the Board had violated 35 U.S.C.
§ 316(e) by improperly relying on a burden-shifting
framework that required the patent owner, not the peti-
tioner, to prove the unpatentability of claims on which
review was instituted. We held that the Board had en-
gaged repeatedly in such impermissible burden shifting.
Magnum Oil, 829 F.3d at 1375–79. We then explained
that the evidence in the record did not permit the findings
of fact needed to establish unpatentability, noting that on
the crucial points the petitioner’s evidence consisted of no
ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG 13
more than legally insufficient “conclusory statements.”
Id. at 1380.
In the final paragraph of the opinion, we addressed
the Director’s broad contention that the Board was free to
make an argument for the petitioner simply because the
argument “‘could have been included in a properly-drafted
petition.’” Id. at 1377, 1380 (quoting Intervenor’s Br. 34,
Magnum Oil, 829 F.3d 1364, ECF No. 41). We rejected
“the PTO’s position that the Board is free to adopt argu-
ments on behalf of petitioners that could have been, but
were not, raised by the petitioner during an IPR” and
explained that “the Board must base its decision on
arguments that were advanced by a party, and to which
the opposing party was given a chance to respond.” Id. at
1381 (citing SAS Inst., Inc. v. ComplementSoft, LLC, 825
F.3d 1341, 1351 (Fed. Cir. 2016)).
Magnum Oil, we conclude, is best understood as sup-
porting Rovalma’s contention only with respect to the
requirement of notice and opportunity to be heard, and no
further. Here, the Board resolved an active dispute over
claim construction in favor of the patent owner and, using
the patent owner’s construction, relied on the patent
owner’s own submissions to determine how a skilled
artisan would have read the very prior-art references on
which the petitioner’s obviousness challenge was based. 1
That was not the situation in Magnum Oil. And our
1 Rovalma does not dispute that a skilled artisan’s
background knowledge is relevant to the reading of the
prior art on which the obviousness challenge is based and
that it is permissible, and sometimes even necessary, to
establish such background knowledge by pointing to other
prior art. See, e.g., Van Os, 844 F.3d at 1361; K/S Himpp
v. Hear-Wear Techs., LLC, 751 F.3d 1362, 1365–66 (Fed.
Cir. 2014); Randall Mfg. v. Rea, 733 F.3d 1355, 1362–63
(Fed. Cir. 2013).
14 ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG
statement that the Board must rely on “arguments that
were advanced by a party,” 829 F.3d at 1381, does not, by
its terms, preclude the Board from relying on arguments
made by a party and doing its job, as adjudicator, of
drawing its own inferences and conclusions from those
arguments, even when the result is use of the party’s
submissions against it—subject, of course, to the provision
of adequate notice and opportunity to be heard.
We do not see any reason that Magnum Oil should be
read more broadly to establish a statutory rule prohibit-
ing the Board from ever relying on a patent owner’s own
submissions in determining unpatentability, even as
evidence of the knowledge a relevant skilled artisan
would bring to reading the prior art asserted by the
petitioner. Magnum Oil was addressing only the Direc-
tor’s broad assertion that the Board could raise any
argument that could have been included in a petition.
Rejecting that broad assertion does not imply precluding
reliance on a patent owner’s own submissions (part of the
record created by the parties) essentially as admissions, if
adequate notice and opportunity to be heard are provided.
And Rovalma has identified nothing in the statute that
forbids the Board to follow the principle, which is well
established in other adjudicatory settings, that a tribunal
may use a party’s own submissions against it, even if the
opposing party bears the burden of persuasion. See, e.g.,
Advanced Magnetic Closures, Inc. v. Rome Fastener Corp.,
607 F.3d 817, 832 (Fed. Cir. 2010) (“To the extent that the
district court relied on Mr. Riceman’s testimony to explain
Mr. Bauer’s motives for listing himself as the ’773 patent
inventor, . . . we find this error harmless because [the
patent owner’s] own evidence . . . provided a sufficient
basis on which to infer that Mr. Bauer intended to deceive
the PTO.”); Nobelpharma AB v. Implant Innovations, Inc.,
141 F.3d 1059, 1065 (Fed. Cir. 1998) (“[T]he district court
did not place the burden of proving validity on [the patent
owner]; [the patent owner’s] own evidence was clear and
ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG 15
convincing that the patent is invalid.”); Mroz v. Dravo
Corp., 429 F.2d 1156, 1163 (3d Cir. 1970) (“It is true that
the burden of proof is on the defendant to prove contribu-
tory negligence. But . . . contributory negligence may . . .
be established by the plaintiff’s evidence alone.”).
SAS Institute, on which we relied in Magnum Oil for
the statement invoked by Rovalma, also supports a nar-
rower reading of Magnum Oil than Rovalma urges. In
SAS Institute, we affirmed the Board’s construction of
certain claim language, but remanded for application of
that construction. 825 F.3d at 1348–53. As we explained,
remand was necessary because the Board had newly
adopted that construction in its final written decision—
even though the parties did not dispute the meaning of
the construed claim language—without giving the peti-
tioner an opportunity to argue that the claims would have
been unpatentable under that (correct) construction. Id.
at 1350–53. The provision of a remand in SAS Institute
cuts against Rovalma’s position regarding Magnum Oil
and the statute. If the statute prohibited the Board from
ever determining that a claim was unpatentable under a
construction that the petitioner had not addressed in its
submissions, remand would have been inappropriate in
SAS Institute.
For those reasons, we conclude that Rovalma has not
shown a statutory bar, independent of whether it had
adequate notice and opportunity to be heard, to the
Board’s reliance on Rovalma’s submissions in determining
what a skilled artisan would have found obvious based on
Böhler’s prior-art references. We must therefore turn to
Rovalma’s argument that it lacked adequate notice and
opportunity to be heard. Before we do so, however, we
emphasize two ways in which our conclusion in this
subsection is limited.
First, we have addressed Rovalma’s statutory argu-
ment only in the context of the circumstances of this case.
16 ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG
We have not explored other questions about what authori-
ty the statute might permit the Board to exercise to raise
issues or arguments or to produce evidence sua sponte in
an inter partes review, if it gave adequate notice and an
adequate opportunity to be heard, as district courts may
sometimes do in their cases. See, e.g., Day v. McDonough,
547 U.S. 198, 205–11 (2006) (discussing a district court’s
authority to raise certain affirmative defenses not raised
by party); Monolithic Power Sys., Inc. v. O2 Micro Int’l
Ltd., 558 F.3d 1341, 1346–48 (Fed. Cir. 2009) (discussing
a district court’s authority to call and to question witness-
es and to appoint its own expert under Fed. R. Evid. 614
and 706 and to rely on the resulting evidence).
Second, we have addressed and rejected only Roval-
ma’s contention about statutory authority. We have not
decided what regulatory or other non-statutory con-
straints, either on the Board or on the parties, such as
those which govern waiver or forfeiture, might apply to
the Board’s determination of unpatentability under
Rovalma’s claim construction. We note that, in this case,
unlike in SAS Institute, the petitioner had clear notice
that the Board might adopt the claim construction ulti-
mately adopted—that construction was argued in the
Patent Owner’s Response—yet it did not present a case
for unpatentability under that construction when it had
the opportunity, in its Reply. Whether Böhler committed
a forfeiture, and whether Rovalma has preserved a forfei-
ture contention, are among the non-statutory matters
open for the Board to consider in the remand we order.
2
Under the APA, the Board must comply with certain
procedural requirements in conducting an inter partes
review. Notably, the Board must timely inform a patent
owner of “the matters of fact and law asserted,” give the
patent owner an “opportunity” for the “submission and
consideration of facts” and “arguments,” and permit the
ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG 17
patent owner “to submit rebuttal evidence, and to conduct
such cross-examination as may be required for a full and
true disclosure of the facts.” 5 U.S.C. §§ 554(b)(3), (c),
556(d); see, e.g., SAS Inst., 825 F.3d at 1351; Dell Inc. v.
Acceleron, LLC, 818 F.3d 1293, 1301 (Fed. Cir. 2016);
Belden Inc. v. Berk-Tek LLC, 805 F.3d 1064, 1080 (Fed.
Cir. 2015). In applying those provisions, we have ex-
plained that the Board “‘may not change theories in
midstream without giving respondents reasonable notice
of the change’ and ‘the opportunity to present argument
under the new theory.’” Belden, 805 F.3d at 1080 (quoting
Rodale Press, Inc. v. FTC, 407 F.2d 1252, 1256–57 (D.C.
Cir. 1968)). The Board’s procedural obligations are not
satisfied merely because a particular fact might be found
somewhere amidst the evidence submitted by the parties,
without attention being called to it so as to provide ade-
quate notice and an adequate opportunity to be heard.
NuVasive, 841 F.3d at 971.
In this case, because we cannot sufficiently determine
how the Board reached the conclusion that the challenged
claims would have been obvious, we also cannot conclu-
sively determine whether the Board’s actions complied
with the APA’s procedural requirements. As discussed
above, the Board’s decision indicates that the Board found
that a person of ordinary skill would have appreciated
that the claimed thermal conductivities could be achieved
by practicing the claimed process steps, but does not
adequately explain the basis for that finding. Because the
asserted prior-art references concededly did not disclose
those steps in as many words, the Board relied on Roval-
ma’s submissions to determine that skilled artisans would
have found the process steps obvious.
To the extent that the Board did rely on Rovalma’s
submissions, and drew reasonably disputable inferences
from those submissions, Rovalma was entitled to ade-
quate notice of and opportunity to address those infer-
ences. But Böhler never described what inferences were
18 ROVALMA, S.A. v. BOHLER-EDELSTAHL GMBH & CO. KG
to be made, as it essentially disregarded the process steps
throughout the Board proceeding. And although the
Board discussed the process steps extensively at the oral
argument, that was too late in the absence of an addition-
al adequate opportunity to be heard. See Dell, 818 F.3d at
1301.
Because we cannot sufficiently determine which in-
ferences the Board drew from Rovalma’s submissions, we
will not decide whether the Board violated Rovalma’s
procedural rights. To make that decision, we would need
to be able to determine what evidence the Board relied on
to support its implicit factual findings, how the Board
interpreted that evidence, and what inferences the Board
drew from it. The Board’s opinion does not sufficiently
permit such determinations. As with the substantial-
evidence challenge, a remand is warranted on Rovalma’s
procedural challenge. See Personal Web Technologies, 848
F.3d at 991–94; NuVasive, 842 F.3d at 1381–85; Ariosa
Diagnostics, 805 F.3d at 1364–67.
CONCLUSION
For the foregoing reasons, we vacate the Board’s deci-
sion and remand for further proceedings.
No costs.
VACATED AND REMANDED