Paice LLC v. Ford Motor Company

United States Court of Appeals
for the Federal Circuit
______________________
PAICE LLC, THE ABELL FOUNDATION, INC.,
Appellants
v.
FORD MOTOR COMPANY,
Appellee
______________________
2017-1387, 2017-1388, 2017-1390, 2017-1457, 2017-1458
______________________
Appeals from the United States Patent and Trade-
mark Office, Patent Trial and Appeal Board in Nos.
IPR2015-00606, IPR2015-00758, IPR2015-00785,
IPR2015-00799, IPR2015-00801.
-----------------------------------------------
PAICE LLC, THE ABELL FOUNDATION, INC.,
Appellants
v.
FORD MOTOR COMPANY,
Appellee
______________________
2017-1406
______________________
2 PAICE LLC v. FORD MOTOR COMPANY
Appeal from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in No. IPR2015-
00792.
______________________
Decided: February 1, 2018
______________________
RUFFIN B. CORDELL, Fish & Richardson, PC, Washing-
ton, DC, argued for appellants. Also represented by
TIMOTHY W. RIFFE, BRIAN JAMES LIVEDALEN, DANIEL
TISHMAN.
GABRIEL BELL, Latham & Watkins LLP, Washington,
DC, argued for appellee. Also represented by MATTHEW J.
MOORE; FRANK A. ANGILERI, SANGEETA G. SHAH, JOHN P.
RONDINI, ANDREW B. TURNER, Brooks Kushman PC,
Southfield, MI.
______________________
Before LOURIE, O’MALLEY, and TARANTO, Circuit Judges.
O’MALLEY, Circuit Judge.
Paice LLC and The Abell Foundation, Inc. (collective-
ly, “Paice”) appeal from final written decisions in six inter
partes review (“IPR”) proceedings, in which the Patent
Trial and Appeal Board (“Board”) held certain challenged
claims of U.S. Patent Nos. 7,237,634 (“’634 patent”) and
8,214,097 (“’097 patent”) unpatentable. 1 For the following
1 See Ford Motor Co. v. Paice LLC, IPR2015-00606,
Paper No. 33 (P.T.A.B. Nov. 8, 2016) (606 IPR); Ford
Motor Co. v. Paice LLC, IPR2015-00758, Paper No. 28
(P.T.A.B. Nov. 8, 2016) (758 IPR); Ford Motor Co. v. Paice
LLC, IPR2015-00785, Paper No. 31 (P.T.A.B. Oct. 21,
2016) (785 IPR); Ford Motor Co. v. Paice LLC, IPR2015-
00792, Paper No. 30 (P.T.A.B. Oct. 25, 2016) (792 IPR);
PAICE LLC v. FORD MOTOR COMPANY 3
reasons, we affirm in part, vacate in part, and remand. In
particular, we vacate the Board’s obviousness determina-
tions as they relate to the ’634 patent’s “electrical” claims
and remand for the Board to determine whether those
claims find written description support in the priority
applications and the references incorporated therein. We
affirm the Board’s obviousness determinations as to all
other claims.
I. FACTUAL BACKGROUND
A. The ’634 and ’097 Patents
The subject matter of the ’634 and ’097 patents has
been discussed in considerable detail in previous decisions
of this court. See Paice LLC v. Ford Motor Co., 681 F.
App’x 885, 887–88 (Fed. Cir. 2017) (Paice I) (involving
related patent); Paice LLC v. Ford Motor Co., 681 F. App’x
904, 908 (Fed. Cir. 2017) (Paice II) (involving related
patent); Paice LLC v. Ford Motor Co., 685 F. App’x 940,
943 (Fed. Cir. 2017) (Paice III) (involving ’097 patent); see
also Paice LLC v. Ford Motor Co., 685 F. App’x 950 (Fed.
Cir. 2017) (Paice IV) (summary affirmance of Board
decision involving the ’634 patent). 2 We recite here only
the background necessary to resolve the issues on appeal.
Paice’s related ’634 and ’097 patents, both titled “Hy-
brid Vehicles,” are directed to a torque-based algorithm
for selecting operating modes in a hybrid vehicle having
an internal combustion engine and one or more battery-
Ford Motor Co. v. Paice LLC, IPR2015-00799, Paper No.
30 (P.T.A.B. Nov. 8, 2016) (799 IPR); Ford Motor Co. v.
Paice LLC, IPR2015-00801, Paper No. 28 (P.T.A.B. Oct.
21, 2016) (801 IPR).
2 Related subject matter is also at issue in appeals
17-1263, 17-1264, 17-1308, 17-1309, 17-1310, 17-1311, 17-
1442, and 17-1443, which were argued in tandem with the
present appeals.
4 PAICE LLC v. FORD MOTOR COMPANY
powered electric motors. The claims at issue generally
recite methods for comparing the instantaneous torque
required to propel the vehicle, which the patents refer to
as “road load” (“RL”), to both a setpoint (“SP”) and the
engine’s maximum torque output (“MTO”) to determine
whether to operate the engine, the electric motor, or both.
’634 patent, col. 3, ll. 12–21; id. col. 13, ll. 12–29, 44–65;
id. col. 41, l. 4 through col. 43, l. 25 & Fig. 9. Claim 241 of
the ’634 patent is representative and recites:
241. A method for controlling a hybrid vehicle,
comprising:
determining instantaneous road load (RL)
required to propel the hybrid vehicle re-
sponsive to an operator command;
operating at least one electric motor to
propel the hybrid vehicle when the RL re-
quired to do so is less than a setpoint (SP);
operating an internal combustion engine
of the hybrid vehicle to propel the hybrid
vehicle when the RL required to do so is
between the SP and a maximum torque
output (MTO) of the engine, wherein the
engine is operable to efficiently produce
torque above the SP, and wherein the SP
is substantially less than the MTO; and
operating both the at least one electric
motor and the engine to propel the hybrid
vehicle when the torque RL required to do
so is more than the MTO;
controlling said engine such that combus-
tion of fuel within the engine occurs sub-
stantially at a stoichiometric ratio,
wherein said controlling the engine com-
prises limiting a rate of change of torque
output of the engine; and
PAICE LLC v. FORD MOTOR COMPANY 5
if the engine is incapable of supplying in-
stantaneous torque required to propel the
hybrid vehicle, supplying additional
torque from the at least one electric motor.
Id. col. 81, ll. 33–58.
Also at issue are claims that recite limitations related
to the voltage and current output of the electric motor’s
battery. Claim 245, for example, recites a voltage output
requirement of “at least approximately 500 volts”:
245. The method of claim 241,
wherein said operating the at least one
electric motor comprises supplying energy
from a battery;
wherein a maximum DC voltage supplied
from said battery is at least approximately
500 volts.
Id. col. 82, ll. 1–5 (emphasis added). These “electrical”
claims first appeared in a continuation-in-part application
filed on April 2, 2001. The ’634 patent is a divisional of a
divisional of that application.
Finally, several claims of the ’634 patent require
operating the engine at torque output levels less than the
setpoint “under abnormal and transient conditions.”
Claim 265, for example, recites:
265. The method of claim 241, further compris-
ing:
operating the engine at torque output lev-
els less than the SP under abnormal and
transient conditions to satisfy drivability
and/or safety considerations.
Id. col. 83, ll. 51–54 (emphasis added). Claims 7, 17, 27,
and 37 of the ’097 patent also recite this “abnormal and
transient conditions” limitation.
6 PAICE LLC v. FORD MOTOR COMPANY
B. Overview of the Prior Art
The Board’s unpatentability determinations are based
on two primary references: (1) U.S. Patent No. 5,343,970
to Severinsky (“Severinsky”), and (2) PCT Application
Publication WO 00/15455 (“’455 PCT publication”). We
briefly describe these references below.
1. Severinsky
Severinsky, which issued to a co-inventor of the ’634
and ’097 patents, describes a control strategy for selecting
operation modes in a hybrid vehicle. Severinsky teaches
that its vehicle’s internal combustion engine is used only
near “its most efficient operational point,” which Severin-
sky defines as when the engine “produces 60–90% of its
maximum torque.” Severinsky, col. 20, ll. 63–67. Sever-
insky also describes circumstances in which it is efficient
to use the engine (such as “in highway cruising”), other
circumstances in which it is more efficient to use an
electric motor (such as “in traffic”), and still other circum-
stances in which torque is supplied by both the electric
motor and the engine (such as in “acceleration/hill climb-
ing mode”). Id. col. 6, l. 63 through col. 7, l. 16; see also id.
col. 14, ll. 15–18; id. col. 22, ll. 48–51.
We previously considered Severinsky in two appeals
from IPR proceedings involving Paice’s hybrid vehicle
patents. See Paice II, 681 F. App’x 904; Paice III, 685 F.
App’x 940. In those cases, we affirmed the Board’s de-
terminations that Severinsky, in combination with other
references, renders obvious various claims of Paice’s
patents.
2. ’455 PCT Publication
The ’455 PCT publication names the same inventors
as the ’634 and ’097 patents and claims priority to appli-
cations that appear in both patents’ chain of priority. The
publication is directed to similar hybrid vehicle technolo-
gy.
PAICE LLC v. FORD MOTOR COMPANY 7
The ’455 PCT publication was published more than
one year before the April 2001 continuation-in-part appli-
cation in which the electrical claims first appeared and
therefore nominally qualifies as prior art to those claims
under 35 U.S.C. § 102(b) (2006).
II. PROCEDURAL BACKGROUND
In response to a patent infringement suit, Appellee
Ford Motor Company (“Ford”) filed twenty-five IPR peti-
tions against Paice’s patents, including those that led to
the six proceedings at issue here. The Board held most
claims challenged in these proceedings unpatentable as
obvious over various combinations of prior art references
involving Severinsky and the ’455 PCT publication.
Relevant to this appeal, the Board determined that
Severinsky discloses a torque-based algorithm for deter-
mining which operating mode to select in a hybrid vehicle.
758 IPR, slip op. at 14–28; 785 IPR, slip op. at 20–25; 801
IPR, slip op. at 19–25. The Board also interpreted the
term “abnormal and transient conditions” recited in the
claims of the ’634 and ’097 patents as including starting
and stopping the engine. The Board agreed with Ford
that Severinsky discloses the limitation as construed by
the Board. 785 IPR, slip op. at 14–16, 37, 39, 53–54; 792
IPR, slip op. at 13–15, 29–32; 801 IPR, slip op. at 15–16,
28–29, 55–56. Based in part on these findings, the Board
held claims 91–92, 112, 125–26, 145, 252–53, 265–66,
278–79, 282, and 290–91 of the ’634 patent and claims 7,
17, 27, and 37–38 of the ’097 patent unpatentable as
obvious over Severinsky in view of other prior art of
record. 3
3 We address here only those claims that Paice
identifies as remaining in dispute. See No. 17-1387, Reply
Br. 7; No. 17-1406, Reply Br. 1, 2 n.2; see also Ltr. from
Appellants, Paice LLC v. Ford Motor Co., No. 17-1387,
8 PAICE LLC v. FORD MOTOR COMPANY
Finally, the Board determined that the ’455 PCT pub-
lication discloses the torque-based control strategy recited
in the electrical claims of the ’634 patent, and that Sever-
insky discloses the electrical limitations themselves.
606 IPR, slip op. at 7–20; 799 IPR, slip op. at 7–18. Based
on these findings, the Board held claims 56–65, 68–77,
242–51, 268–77, 292–93, and 298 of the ’634 patent un-
patentable as obvious over the ’455 PCT publication in
view of Severinsky.
Paice appealed to this court. We have jurisdiction
under 28 U.S.C. § 1295(a)(4)(A).
III. DISCUSSION
Paice raises two principal arguments, and a bevy of
subsidiary arguments, on appeal. First, Paice argues that
the Board’s Severinsky-based findings are unsupported by
substantial evidence. In particular, Paice asserts that
Severinsky discloses a speed-based algorithm, not a
torque-based one as required by the patent claims, and
that the Board erred in its construction of “abnormal and
transient conditions.” Second, Paice argues that the
Board erred in finding that the ’455 PCT publication
qualifies as prior art to the ’634 patent’s electrical claims.
We address each argument in turn.
A. The Board’s Severinsky-Based
Obviousness Determinations
The Board determined that Severinsky renders obvi-
ous various claims of the ’634 and ’097 patents. Obvious-
ness is a question of law based on underlying factual
findings relating to “the scope and content of the prior art,
differences between the prior art and the claims at issue,
Dkt. 51 (Fed. Cir. June 29, 2017); Ltr. from Appellants,
No. 17-1406, Paice LLC v. Ford Motor Co., Dkt. 46 (Fed.
Cir. June 19, 2017).
PAICE LLC v. FORD MOTOR COMPANY 9
the level of ordinary skill in the pertinent art, and any
objective indicia of non-obviousness.” Randall Mfg. v.
Rea, 733 F.3d 1355, 1362 (Fed. Cir. 2013) (citing KSR Int’l
Co. v. Teleflex Inc., 550 U.S. 398, 406 (2007)). We review
the Board’s ultimate legal determination of obviousness
de novo and its underlying factual findings for substantial
evidence. PPC Broadband, Inc. v. Corning Optical
Commc’ns RF, LLC, 815 F.3d 747, 751 (Fed. Cir. 2016).
Substantial evidence is “such relevant evidence as a
reasonable mind might accept as adequate to support a
conclusion.” In re Gartside, 203 F.3d 1305, 1312 (Fed.
Cir. 2000) (quoting Consol. Edison Co. of N.Y. v. N.L.R.B.,
305 U.S. 197, 229 (1938)).
1. The Board’s Finding That Severinsky
Discloses a Torque-Based Control Algorithm
Paice argues that the Board erred in finding that Sev-
erinsky discloses a torque-based system for selecting
operating modes. According to Paice, Severinsky teaches
a speed-based system, and, to the extent Severinsky
mentions torque at all, it refers only to the engine’s out-
put torque, which is different from the claimed road load
torque. We disagree. As the Board found, Severinsky
discloses that a microprocessor may determine “the load
(if any) to be provided to the engine by the motor, respon-
sive to the load imposed by the vehicle’s propulsion re-
quirements, so that the engine can be operated in its most
fuel efficient operating range.” 758 IPR, slip op. at 18
(emphasis altered) (quoting Severinsky, col. 17, ll. 11–15).
The Board found that “the load imposed by the vehicle’s
propulsion requirements” is the road load. Id. at 18–19.
Thus, the Board reasonably concluded that Severinsky’s
electric motor can be triggered in response to the vehicle’s
road load.
As the Board also found, Severinsky elsewhere states
that the microprocessor “determines whether the internal
combustion engine or the electric motor or both should
10 PAICE LLC v. FORD MOTOR COMPANY
provide torque to the wheels under various monitored
operating conditions.” Id. at 15 (emphasis altered) (quot-
ing Severinsky, col. 6, ll. 19–23). This passage suggests
that “torque to the wheels”—i.e., road load—is a criterion
for determining which mode of operation to select. Final-
ly, Severinsky states that the combustion engine is used
“only in the near vicinity of its most efficient operational
point,” which is when the engine “produces 60–90% of its
maximum torque.” Id. at 16 (quoting Severinsky col. 20,
ll. 63–67). Ford’s expert testified that “a skilled artisan
would have understood that Severinsky’s lower limit of
60% of MTO is a ‘setpoint.’” Id. at 17. Based on that
testimony, the Board concluded that Severinsky teaches
that its engine operates when the road load reaches a
setpoint. The Board’s finding that Severinsky uses road
load torque, rather than engine output torque, is reasona-
ble and supported by substantial evidence.
The Board’s findings are also consistent with the ’634
patent’s own description of Severinsky. The ’634 patent
states that “an important aspect of the invention of”
Severinsky is that, “[w]hen the vehicle operating condi-
tions require torque of [a certain] magnitude, the engine is
used to propel the vehicle,” but “when less torque is re-
quired, an electric motor powered by electrical energy
stored in a substantial battery bank drives the vehicle.”
785 IPR, slip op. at 57 (quoting ’634 patent, col. 25, ll. 11–
24) (emphases added). As the Board concluded, this and
other statements indicate that road load is used to select
operating modes and are “probative on how one with
ordinary skill in the art at the time of filing of the in-
volved patent would have read and understood the disclo-
sure of the prior art.” Id. at 54–55, 57; see also
PharmaStem Therapeutics, Inc. v. ViaCell, Inc., 491 F.3d
1342, 1362 (Fed. Cir. 2007) (“Admissions in the specifica-
tion regarding the prior art are binding on the patentee
for purposes of a later inquiry into obviousness.”).
PAICE LLC v. FORD MOTOR COMPANY 11
Paice’s argument that Severinsky discloses a speed-
based comparison rather than a torque-based one is
undermined by the passages described above. It is true
that Severinsky refers to speed when describing certain
modes of operation. See, e.g., Severinsky, col. 18, ll. 36–38
(“The vehicle will operate in a highway mode with the
engine running constantly after the vehicle reaches a
speed of 30–35 mph.”). But, as the Board explained, even
if Severinsky describes speed as one factor that can be
considered, it describes torque as another factor, as de-
scribed above. Further, the ’634 patent similarly refers to
speed when describing the vehicle’s operating modes,
stating that “the traction motor provides torque to propel
the vehicle in low-speed situations.” 758 IPR, slip op. at
20 (quoting ’634 patent, col. 17, ll. 46–47; id. col. 19, ll.
45–46). As the Board explained, “Paice cannot hold
Severinsky to a different standard than it holds the
claimed invention.” Id.
We note also that the Board’s findings are consistent
with our rulings in Paice II and Paice III, which involved
Severinsky and Paice’s related patents. In those cases,
we found that substantial evidence supported the Board’s
determination that, “although Severinsky describes the
use of speed as a factor considered by the microprocessor,
it also uses the vehicle’s torque requirements, or road
load, in determining when to operate the engine.” Paice
II, 681 F. App’x at 915; Paice III, 685 F. App’x at 946 (“On
this record, the Board had substantial evidence to find
that Severinsky discloses comparing the amount of torque
required to propel the vehicle to a predetermined torque
value in deciding whether to operate the engine.”). And,
while we “disagree[d] with the Board’s reinterpretation of
‘road load’ as including output torque,” we affirmed the
Board’s finding that “Severinsky relies on road load to
start and operate the engine and motor.” Paice II, 681 F.
App’x at 915. We also rejected many of the same argu-
ments that Paice makes on appeal here. See, e.g., id.
12 PAICE LLC v. FORD MOTOR COMPANY
(rejecting argument that “Severinsky’s microprocessor
uses speed to make such determinations regarding opera-
tion of the engine”). Paice does not persuasively explain
why a different result is required on this record.
For these reasons, substantial evidence supports the
Board’s finding that Severinsky discloses a torque-based
system for selecting operating modes.
2. The Board’s Finding That Severinsky Satisfies the
“abnormal and transient conditions” Claim Limitation
The Board also found that Severinsky discloses the
“abnormal and transient conditions” limitation recited in
certain claims of the ’634 and ’097 patents. The Board
interpreted “abnormal and transient conditions” to cap-
ture “starting the engine and stopping the engine,” includ-
ing in “city traffic and reverse operation.” See 785 IPR,
slip op. at 14–16; 792 IPR, slip op. at 13–15; 801 IPR, slip
op. at 15–16. Paice asserts that the Board’s construction
is too broad.
In IPR proceedings, the Board gives claim terms their
broadest reasonable interpretation in light of the claims
and specification. See Cuozzo Speed Techs., LLC v. Lee,
136 S. Ct. 2131, 2142–46 (2016). We review the Board’s
ultimate claim constructions de novo and its underlying
factual determinations involving extrinsic evidence for
substantial evidence. See Teva Pharm. USA, Inc. v.
Sandoz, Inc., 135 S. Ct. 831, 841–42 (2015); PPC Broad-
band, 815 F.3d at 751.
We agree with the Board’s construction of “abnormal
and transient conditions.” The ’634 patent claims do not
specify what “abnormal” or “transient” conditions are,
stating only that the engine must operate at torque
output levels less than the setpoint when such conditions
exist in order “to satisfy drivability and/or safety consid-
erations.” ’634 patent, col. 83, ll. 51–54 (claim 265).
Further, neither “abnormal” nor “transient” is used in the
PAICE LLC v. FORD MOTOR COMPANY 13
patent specifications. With no intrinsic evidence to shed
light on the claim term’s meaning, the Board turned to
the ’634 patent’s parent patent, U.S. Patent No. 7,104,347
(“’347 patent”), which is at issue in the companion ap-
peals. See Paice LLC v. Ford Motor Co., Nos. 17-1263, 17-
1264, 17-1308, 17-1309, 17-1310, 17-1311, 17-1442, 17-
1443 (Fed. Cir.). Claim 22 of the ’347 patent recites
“abnormal and transient conditions” comprising “starting
and stopping of the engine and provision of torque to
satisfy drivability or safety considerations.” ’347 patent,
col. 60, ll. 17–21.
As the Board correctly found, claim 22 of the ’347 pa-
tent does not present a definition, but instead identifies
non-limiting examples of abnormal and transient condi-
tions—i.e., (1) starting and stopping of the engine, and
(2) provision of torque to satisfy drivability or safety
considerations. The Board appropriately concluded that
“abnormal and transient conditions” include starting and
stopping the engine. This conclusion is reasonable; start-
ing and stopping the engine is a “transient” condition
insofar as it is temporary. Once the engine is on, the
condition has ceased.
This conclusion, moreover, is consistent with the
prosecution history of the ’097 patent. Paice emphasized
during prosecution that the “abnormal and transient
conditions” recited in the claims “are such conditions as
starting the engine, during which operation it must neces-
sarily be operated at less than SP for a short time.”
J.A. 12,489 (emphasis added). 4 This statement clearly
indicates that “abnormal and transient conditions” en-
compass at least starting the engine. See Ventana Med.
Sys., Inc. v. Biogenex Labs., Inc., 473 F.3d 1173, 1184
(Fed. Cir. 2006) (“As with statements made by the inven-
4 Appendix citations are to the joint appendix in
appeal No. 17-1387 unless otherwise indicated.
14 PAICE LLC v. FORD MOTOR COMPANY
tor during the prosecution of an ancestor application,
statements made during the continued prosecution of a
sibling application may inform the meaning of the claim
language by demonstrating how the inventor understood
the invention.” (internal quotation marks omitted)).
Paice makes two arguments as to why the Board nev-
ertheless erred. First, Paice argues that, even if claim 22
of the ’347 patent recites two examples of abnormal and
transient conditions, the ’634 patent claims cover only the
latter example—i.e., “provision of torque to satisfy driva-
bility or safety considerations.” It is true that the ’634
patent claims require that the engine operate at torque
levels less than the setpoint under abnormal and transi-
ent conditions “to satisfy drivability and/or safety consid-
erations.” ’634 patent, col. 83, ll. 51–54. But operating
the engine at output levels less than the setpoint when
starting and stopping the engine appears to satisfy those
conditions. Indeed, it is reasonable to conclude that
operating the engine at low torque as the engine turns on
does in fact promote drivability and/or safety considera-
tions because it allows the engine to slowly ramp up to a
suitably high rpm.
Second, Paice argues that the Board erred by failing
to exclude from its construction starting and stopping the
engine during city traffic and reverse operation of the
vehicle. According to Paice, it specifically disclaimed such
claim scope during prosecution of the ’097 patent when it
stated that “city traffic and reverse operation are normal
conditions.” J.A. 12,489. Again, we disagree. Paice’s
statement made during prosecution implies only that city
traffic and reverse operation are not, by themselves,
abnormal and transient conditions. The statement does
not imply that starting and stopping the engine, which is
generally an abnormal and transient condition, is no
longer such a condition when performed in city traffic or
reverse operation. We therefore find that the Board’s
PAICE LLC v. FORD MOTOR COMPANY 15
construction of “abnormal and transient conditions” is the
broadest reasonable construction of that term.
With respect to the ’097 patent, Paice additionally ar-
gues that the Board erred in determining that Severinsky
discloses the “abnormal and transient conditions” limita-
tion. According to Paice, the Board found that Severinsky
discloses operating the engine below the setpoint to
preserve the battery’s life, which the Board found satisfies
“drivability and safety considerations.” But, Paice as-
serts, the Board never made a finding that Severinsky
discloses operating the engine below the setpoint during
“abnormal and transient conditions,” as required by the
claims.
We find Paice’s argument unpersuasive. Paice does
not contest the Board’s finding that “abnormal and tran-
sient conditions” should have the same meaning across
the patents. See Omega Eng’g, Inc. v. Raytek Corp., 334
F.3d 1314, 1334 (Fed. Cir. 2003) (“[W]e presume, unless
otherwise compelled, that the same claim term in the
same patent or related patents carries the same construed
meaning.”). And, as the Board explained, Severinsky
describes instances—e.g., “low-speed vehicle operation in
traffic”—when it might be “preferable to use the engine
somewhat inefficiently rather than to discharge the
batteries excessively, which would substantially reduce
the battery lifetime.” 792 IPR, slip op. at 31–32 (quoting
Severinsky, col. 18, ll. 23–33 (internal quotation marks
omitted)). The Board determined that “Severinsky ra-
tionalizes its decision to operate the engine outside its
most fuel efficient range”—i.e., below the setpoint—“as a
tradeoff between engine efficiency and vehicle drivability
and safety considerations.” Id. at 31. In other words,
Severinsky teaches operating the engine below the set-
point in order to provide torque to satisfy safety and
drivability considerations, which is covered by the Board’s
construction of “abnormal and transient conditions.” 785
IPR, slip op. at 15; 792 IPR, slip op. at 14–15 & n.10.
16 PAICE LLC v. FORD MOTOR COMPANY
And, as Ford’s expert explained, Severinsky discloses
operating the engine below the setpoint when starting the
engine, which, as described above, is a transient condi-
tion. No. 17-1406, J.A. 20,284–85. In particular, Severin-
sky discloses that, during low-speed operation, there are
instances in which the “motor will start the engine while
driving the vehicle” when the battery is discharged by 10–
20%. Severinsky, col. 17, ll. 56–64. In other words,
Severinsky teaches operating the engine below the set-
point while starting the engine, which is also covered by
the Board’s construction.
For these reasons, substantial evidence supports the
Board’s findings that Severinsky discloses the “abnormal
and transient conditions” limitation recited in the ’634
and ’097 patent claims.
3. Paice’s Additional Contentions
Paice next argues that the Board failed to adequately
explain its rationale for finding claims 91–92, 112, 125–
26, 145, 252–53, 265, 278–79, 282, and 290 of the ’634
patent unpatentable, and instead improperly adopted
Ford’s arguments without explanation. Paice asserts
that, in so doing, the Board failed to create an adequate
record under Securities & Exchange Commission v.
Chenery Corp., 318 U.S. 80 (1943), as to these claims.
Chenery requires that administrative agencies provide
a reasoned basis for their decisions. See id. at 94 (“[T]he
orderly functioning of the process of review requires that
the grounds upon which the administrative agency acted
b[e] clearly disclosed and adequately sustained.”). In the
IPR context, we have interpreted Chenery’s mandate as
requiring the Board’s explanation to “be capable of being
reasonably . . . discerned from a relatively concise . . .
discussion.” In re NuVasive, Inc., 842 F.3d 1376, 1383
(Fed. Cir. 2016) (internal quotation marks omitted). As
we have explained, “it is not adequate to summarize and
reject arguments without explaining why the [Board]
PAICE LLC v. FORD MOTOR COMPANY 17
accepts the prevailing argument.” Id.; Cutsforth, Inc. v.
MotivePower, Inc., 636 F. App’x 575, 578 (Fed. Cir. 2016)
(holding that the Board failed to provide an adequate
record where the “majority of [its] Final Written Decision
is spent summarizing the parties’ arguments and offers
only conclusory analysis of its own”).
In NuVasive, we vacated the Board’s obviousness de-
terminations where the Board neither expressly adopted
the petitioner’s arguments regarding motivation to com-
bine nor provided reasoned explanations for crediting the
arguments. 842 F.3d at 1384. Similarly, in Personal Web
Technologies, LLC v. Apple, Inc., 848 F.3d 987 (Fed. Cir.
2017), we vacated the Board’s obviousness determination
where the Board did “not cite, let alone explain or analyze
or adopt, an earlier portion of [the] petition that refers to”
the relevant passages of the prior art, and essentially
found “that a skilled artisan, once presented with the two
references, would have understood that they could be
combined.” Id. at 993. We recognized, however, that
“[t]he amount of explanation needed to meet the govern-
ing legal standards—to enable judicial review and to
avoid judicial displacement of agency authority—
necessarily depends on context.” Id. at 994. Indeed, “[a]
brief explanation may do all that is needed if, for example,
the technology is simple and familiar and the prior art is
clear in its language and easily understood.” Id.
Although the technology at issue here is arguably not
“simple,” it is familiar based in part on Paice’s repeated
arguments in related proceedings and the Board’s hun-
dreds of pages of analysis in these six proceedings. It is
clear from the Board’s analysis that it rejected Paice’s
primary arguments that (1) Severinsky does not disclose a
torque-based system, and (2) “abnormal and transient
conditions” excludes starting and stopping the engine in
city traffic and reverse operation. The Board’s obvious-
ness determinations flow directly from its rejection of
these arguments, and the Board’s analysis is commensu-
18 PAICE LLC v. FORD MOTOR COMPANY
rate with Paice’s arguments. See Novartis AG v. Torrent
Pharm. Ltd., 853 F.3d 1316, 1327–28 (Fed. Cir. 2017)
(finding that it would be inappropriate “to find fault in the
Board’s arguably limited treatment of [certain] argu-
ments” where the Board’s treatment “was at least com-
mensurate with” the patent owner’s presentation of those
arguments).
And, unlike the Board’s decisions in NuVasive and
Personal Web Technologies, the Board’s decisions here cite
to the relevant portions of Ford’s briefing that explain
how the prior art discloses the relevant claim limitations.
785 IPR, slip op. at 28–29, 36–39; 801 IPR, slip op. at 28–
29. In this context, the Board’s analysis is readily dis-
cernible and sufficient under Chenery. See Ignite USA,
LLC v. CamelBak Prods., LLC, No. 2016-2747, 2017 WL
4548459, at *5 (Fed. Cir. Oct. 12, 2017) (noting that,
although it is usually insufficient for the Board to merely
reject one side’s arguments, it is sufficient for the Board
to explain that it finds the other side’s arguments and
supporting evidence more persuasive).
Finally, Paice argues that the Board erred in finding
that Severinsky, in combination with the secondary
references of record, renders dependent claims 252–53,
265–66, and 291 of the ’634 patent obvious. The Board’s
determinations, however, are consistent with our decision
in the companion case, see Paice LLC v. Ford Motor Co.,
Nos. 17-1263, 17-1264, 17-1308, 17-1309, 17-1310, 17-
1311, 17-1442, 17-1443 (Fed. Cir.), as well as our deci-
sions in Paice I and Paice III, in which we rejected many
of these same arguments, see Paice I, 681 F. App’x at 890–
91; Paice III, 685 F. App’x at 946. We see no reason to
depart from our conclusions in those cases.
We have considered Paice’s remaining arguments as
to the Board’s Severinsky-based obviousness determina-
tions and find them unpersuasive. In sum, substantial
evidence supports the Board’s findings as to claims 91–92,
PAICE LLC v. FORD MOTOR COMPANY 19
112, 125–26, 145, 252–53, 265–66, 278–79, 282, and 290–
91 of the ’634 patent and claims 7, 17, 27, and 37–38 of
the ’097 patent. We therefore affirm the Board’s obvious-
ness determinations as to those claims.
B. The Board’s ’455 PCT Publication-Based Findings
The Board also found that the ’455 PCT publication,
in view of Severinsky, renders obvious the electrical
claims of the ’634 patent. Paice does not challenge the
Board’s finding that the references disclose every limita-
tion recited in those claims or that a skilled artisan would
have been motivated to combine the references. Instead,
Paice argues only that the ’455 PCT publication is not
prior art to the electrical claims because they claim priori-
ty to an application, U.S. Patent Application No.
09/264,817 (“’817 application”), that predates the ’455
PCT publication.
The priority date for later-added patent claims de-
pends on when the claimed subject matter first appeared
in the chain of patent applications from which the claims
arose. Augustine Med., Inc. v. Gaymar Indus., Inc., 181
F.3d 1291, 1302 (Fed. Cir. 1999). For claims to be entitled
to a priority date of an earlier-filed application, the appli-
cation must provide adequate written description support
for the later-claimed limitations. Id.; see also Progressive
Cas. Ins. Co. v. Liberty Mut. Ins. Co., 625 F. App’x 552,
558 (Fed. Cir. 2015). Here, Paice asserts that the ’817
application incorporates by reference Severinsky, which
itself provides the requisite written description support. 5
The Board rejected that argument, concluding that the
’817 application does not incorporate Severinsky, and that
5 Paice makes similar arguments with respect to
other priority applications, but, because we agree with
Paice’s arguments as to the ’817 application, we find it
unnecessary to consider any of those other applications.
20 PAICE LLC v. FORD MOTOR COMPANY
the electrical claim limitations lack written description
support in the ’817 application standing alone. The
threshold question on appeal, therefore, is whether the
Board’s incorporation ruling is in error. We conclude that
it is.
Incorporation by reference provides “a method for in-
tegrating material from various documents into a host
document[] . . . by citing such material in a manner that
makes clear that the material is effectively part of the
host document as if it were explicitly contained therein.”
Advanced Display Sys., Inc. v. Kent State Univ., 212 F.3d
1272, 1282 (Fed. Cir. 2000). “To incorporate material by
reference, the host document must identify with detailed
particularity what specific material it incorporates and
clearly indicate where that material is found in the vari-
ous documents.” Id. Whether and to what extent materi-
al has been incorporated by reference is a question of law
that we review de novo. Harari v. Lee, 656 F.3d 1331,
1334 (Fed. Cir. 2011). “[T]he standard of one reasonably
skilled in the art should be used to determine whether the
host document describes the material to be incorporated
by reference with sufficient particularity.” Advanced
Display, 212 F.3d at 1283.
The ’817 application expressly incorporates Severin-
sky in the following passage:
This application discloses a number of im-
provements over and enhancements to the hybrid
vehicles disclosed in the inventor’s U.S. Pat. No.
5,343,970 (the “’970 patent”) [Severinsky], which is
incorporated herein by this reference. Where dif-
ferences are not mentioned, it is to be understood
that the specifics of the vehicle design shown in
the ’970 patent are applicable to the vehicles
shown herein as well.
J.A. 11,174 (emphasis added) (also appearing in the
issued ’634 patent at col. 10, ll. 40–47). The first sentence
PAICE LLC v. FORD MOTOR COMPANY 21
of this passage is broad and unambiguous. It states that
Severinsky “is,” without qualification, incorporated into
the ’817 application “by this reference”—i.e., the reference
contained in the sentence. The sentence identifies with
detailed particularity the specific material subject to
incorporation (Severinsky, and not just particular por-
tions thereof) and where that material can be found (U.S.
Patent No. 5,343,970). Such language is plainly sufficient
to incorporate Severinsky in its entirety. See Harari, 656
F.3d at 1335–36 (finding that prior art applications were
incorporated in their entirety based on the following
“broad and unequivocal language”: ‘The disclosures of the
two applications are hereby incorporate[d] by reference’”);
Advanced Display, 212 F.3d at 1282.
The Board reached a contrary conclusion, however, by
relying on the subsequent sentence in the passage, which
states: “Where differences are not mentioned, it is to be
understood that the specifics of the vehicle design shown
in the ’970 patent are applicable to the vehicles shown
herein as well.” According to the Board, this sentence
limits incorporation to only those disclosures in Severin-
sky that are not different from disclosures in the ’817
application. Because the Board found differences between
Severinsky’s disclosures related to the electrical limita-
tions and the ’817 application’s corresponding disclosures,
the Board determined that Severinsky’s disclosures are
not incorporated into the ’817 application. The Board’s
conclusion is incorrect.
The second sentence merely states that Severinsky’s
features are understood to also apply to the vehicles
described as the present invention in the ’817 application,
except where the ’817 application’s specification “men-
tion[s]” otherwise. In other words, the ’817 application
refers to differences from Severinsky only to the extent
necessary to describe differences between the inventions
of Severinsky and the ’817 application. See, e.g., J.A.
11,179 (“According to the present invention, the controlla-
22 PAICE LLC v. FORD MOTOR COMPANY
ble torque-transfer unit shown in the ’970 patent [Sever-
insky] is eliminated by replacing the single electric motor
shown therein by two separate motors[.]”); J.A. 11,190
(similar). This statement provides an expedient way for
the applicant to describe the invention vis-à-vis Severin-
sky without describing every feature of Severinsky that is
subsumed within the invention.
The sentence has no bearing, however, on the extent
of incorporation. It refers only to the applicability of
certain features of Severinsky’s invention to the ’817
application’s purportedly new and improved hybrid vehi-
cle, rather than to which textual portions of the Severin-
sky document are incorporated in the ’817 application.
The applicability of a document’s disclosed features and
the incorporation of the document itself are distinct
concepts, and one does not imply the other. See Modine
Mfg. Co. v. U.S. Int’l Trade Comm’n, 75 F.3d 1545, 1553
(Fed. Cir. 1996) (“[I]ncorporation by reference does not
convert the invention of the incorporated patent into the
invention of the host patent.”); see also Fifth Generation
Comput. Corp. v. Int’l Bus. Machs. Corp., 416 F. App’x 74,
80 (Fed. Cir. 2011) (agreeing that certain prior art refer-
ences were incorporated into the host patent but disagree-
ing “that every concept of the prior inventions is
necessarily imported into every claim of the later patent”);
S. Clay Prods., Inc. v. United Catalysts, Inc., 43 F. App’x
379, 383–84 (Fed. Cir. 2002) (finding incorporation not-
withstanding the host patent’s criticism of the incorpo-
rated patent’s invention). When read in context, the
passage makes clear that it incorporates the entire Sever-
insky document into the ’817 application, but applies only
some of the specific features of Severinsky’s invention
disclosed in that document to the ’817 application’s inven-
tion.
In reaching its contrary conclusion, the Board empha-
sized the differences between the inventions of the ’817
application and Severinsky. But such differences are
PAICE LLC v. FORD MOTOR COMPANY 23
present in every case in which one patent purports to
incorporate another, because, in every case, the host
patent purports to improve upon that which it incorpo-
rates. See In re Schoenwald, 964 F.2d 1122, 1123 (Fed.
Cir. 1992) (“Paramount among the patentability require-
ments is that that which is sought to be patented must be
new.”); see also ContentGuard Holdings, Inc. v. Apple Inc.,
701 F. App’x 957, 958 n.1 (Fed. Cir. 2017) (“The ’053
patent incorporates by reference the Stefik patents and
purports to improve upon the inventions disclosed there-
in.”). This case is no different. In fact, the first sentence
in the incorporation passage quoted above clearly
acknowledges such differences in the form of “improve-
ments” and “enhancements” over Severinsky. See J.A.
11,174 (“This application discloses a number of improve-
ments over and enhancements to the hybrid vehicles
disclosed in [Severinsky.]”); see also J.A. 11,176 (“[I]t is
desired to . . . provid[e] a substantially simplified parallel
hybrid system as compared to those shown in the prior
art, again as including the ’970 [Severinsky] patent.”).
Yet, the function of that sentence is to incorporate Sever-
insky despite such differences.
Even if the second sentence in the ’817 application’s
incorporation clause could be read as a narrow incorpora-
tion, our holding in Harari v. Lee would foreclose the
Board’s conclusion. The patent application at issue in
Harari contained two incorporation clauses. In the first
clause, the application stated that “[t]he disclosures” of
two prior art applications “are hereby incorporate[d] by
reference.” Harari, 656 F.3d at 1335. In the second
clause, the application stated that only the “[r]elevant
portions” of the disclosures are incorporated. Id. We held
that the “broad and unequivocal language” of the first
clause “incorporates the entire disclosures of the two
applications,” and that the second clause’s narrower
language did not diminish the scope of incorporation. Id.
at 1335–36. Similarly, here, the first sentence in the
24 PAICE LLC v. FORD MOTOR COMPANY
passage quoted above incorporates the entire disclosure of
Severinsky, and the second sentence—even if relevant to
incorporation—does not negate or otherwise limit the
broad incorporation effectuated by the first sentence as
the Board found and as Ford urges.
At oral argument before this court, Ford sought to dis-
tinguish Harari on grounds that, in that case, there were
two incorporation clauses separated by several para-
graphs of text, in contrast to this case, where the two
sentences in dispute appear in a single incorporation
clause. Oral Arg. at 26:45–27:12, Paice LLC v. Ford
Motor Co. (No. 2017-1387), http://oralarguments.cafc.
uscourts.gov/default.aspx?fl=2017-1387.mp3. According
to Ford, the “juxtaposition of the two sentences back-to-
back” in the ’817 application would inform a skilled arti-
san that differences are not incorporated therein. Id. at
27:53–28:20.
Ford’s purported distinction of Harari on the basis
that the incorporation clauses at issue were separated by
text is not persuasive. We said nothing in Harari about
the proximity of the incorporation clauses, predicating our
holding instead on the “broad and unequivocal language”
of the first incorporation clause, and notwithstanding that
the incorporation “occurred during a discussion of” partic-
ular teachings. And, while we agree with Ford that
Harari commands that incorporation clauses be read in
context, we disagree that the sentences at issue here limit
the scope of incorporation when so read. The ’817 applica-
tion’s incorporation passage provides no nexus between
the “differences” referenced in the second sentence and
the incorporation referenced in the first sentence, in
contrast to cases in which we have found incorporation to
be limited. See, e.g., Zenon Envtl., Inc. v. U.S. Filter
Corp., 506 F.3d 1370, 1379 (Fed. Cir. 2007) (finding that
the language “[f]urther details relating to the construction
and deployment of a most preferred skein are found in
[prior art patents], the relevant disclosures of each of
PAICE LLC v. FORD MOTOR COMPANY 25
which are included by reference” “expressly limit[ed] the
incorporation to only relevant disclosures of the patents,
indicating that the disclosures are not being incorporated
in their entirety”); Cook Biotech Inc. v. Acell, Inc., 460
F.3d 1365, 1375–76 (Fed. Cir. 2006) (finding incorporation
of only particular teachings from a prior art patent where
the host document’s incorporation clause stated that “the
procedure for preparing intestinal submucosa” detailed in
the prior art patent was “expressly incorporated herein by
reference”). There is no reasonable basis to conclude that
the ’817 application’s second sentence limits the incorpo-
ration set forth in the first sentence.
Ford also asserted for the first time at oral argument
that our decisions in Callaway Golf Co. v. Acushnet Co.,
576 F.3d 1331 (Fed. Cir. 2009), and Husky Injection
Molding Systems Ltd. v. Athena Automation Ltd., 838
F.3d 1236 (Fed. Cir. 2016), support the Board’s ruling.
But, in both cases, we found that the incorporation claus-
es at issue did in fact incorporate the relevant passages of
the prior art into the host documents. And, in any event,
those cases are inapposite.
In Callaway Golf, the incorporation clause stated that
“[r]eference is made to [the prior art patent] which de-
scribes a number of foamable compositions of a character
which may be employed for one or both layers 14 and 16
for the golf ball of this invention.” 576 F.3d at 1345,
1346–47 (emphasis omitted). We found that this passage
adequately “identifie[d] with specificity both what mate-
rial is being incorporated by reference (foamable polymer-
ic compositions suitable for golf ball cover layers) and
where it may be found (the [prior art] patent).” Id. at
1346. The passage at issue here is far more explicit, and,
as described above, makes clear that Severinsky is incor-
porated in its entirety, unlike the much more limited and
ambiguous clause at issue in Callaway Golf.
26 PAICE LLC v. FORD MOTOR COMPANY
In Husky Injection, as in Harari, there were two in-
corporation clauses at issue. The first clause stated that
“[t]he tie-bar nuts can be secured . . . by any appropriate
mechanism, such as the pineapple and toothed-ring
mechanism described in [the prior art patent],” while the
second clause stated that “[a]ll cross-referenced patents
and application[s] referred to in this specification are
hereby incorporated by reference.” 838 F.3d at 1248
(emphasis added). As in Callaway Golf, we held that the
clauses incorporated relevant passages of the prior art
because they “identifie[d] with sufficient particularity
what” they incorporate from the prior art—i.e., toothed
locking mechanisms. Id. at 1248. We therefore held that
the two clauses “work in concert to incorporate at least
some portions of” the prior art patent. Id. at 1249. But,
because we held that the relevant passages from the prior
art were incorporated, we found it unnecessary to deter-
mine whether the second, broader clause incorporated the
prior art patent in its entirety. Id. (“It is therefore of no
consequence whether Glaesener’s broader statement in
fact incorporates the rest of Choi, i.e., in its entirety.”).
Here, by contrast, we find that the first sentence in the
’817 application’s incorporation passage incorporates
Severinsky in its entirety, and Husky Injection is there-
fore inapposite.
To the extent Ford cites Callaway Golf and Husky In-
jection for the proposition that incorporation language
must be read in context and holistically, we agree. And,
as described above, when so read, the incorporation clause
at issue here incorporates Severinsky in its entirety. We
conclude that the Board erred in holding otherwise. 6
6 In a previous appeal involving the same parties,
we stated in a footnote that Severinsky is incorporated by
reference in the related ’347 patent. See Paice II, 681 F.
PAICE LLC v. FORD MOTOR COMPANY 27
That conclusion, however, does not end the inquiry.
To prevail on its argument that the ’455 PCT publication
is not prior art to the electrical claims, Paice must show
that the ’817 application, with Severinsky incorporated
therein, provides sufficient written description support for
those claims. And, although the Board analyzed the ’817
application to determine whether it provides such sup-
port, the Board did not analyze Severinsky for that pur-
pose.
The written description inquiry is a highly fact-
intensive one that “requires fact findings this court is not
permitted to make.” Bilstad v. Wakalopulos, 386 F.3d
1116, 1126 (Fed. Cir. 2004); Union Oil Co. of Cal. v. Atl.
Richfield Co., 208 F.3d 989, 1000 (Fed. Cir. 2000) (noting
that “written description questions are intensely factual,
and should be dealt with on a case-by-case basis, without
the application of wooden rules”). We therefore remand
for the Board to determine in the first instance whether
the ’817 application, with Severinsky incorporated there-
in, supplies the requisite written description support for
the ’634 patent’s electrical claims. In other words, the
Board must consider Severinsky for that purpose on
remand. 7
App’x at 914 n.4. The ’347 patent specification contains
the same incorporation language at issue here.
7 Although the Board found, in the context of its
incorporation-by-reference analysis, certain “differences”
between Severinsky’s electrical disclosure and the ’817
application’s corresponding disclosure, such differences do
not necessarily preclude a finding that Severinsky pro-
vides written description support for the electrical limita-
tions recited in the ’634 patent claims. See 606 IPR, slip
op. at 9 (agreeing with Ford that, for purposes of obvious-
ness, Severinsky “teaches the specific voltage, current,
and ratio values recited by the challenged claims”).
28 PAICE LLC v. FORD MOTOR COMPANY
Finally, with respect to the electrical claims that re-
cite a low electrical current—i.e., a current below approx-
imately 75 amperes or 150 amperes, see, e.g., ’634 patent,
col. 63, ll. 30–31 (claim 58); id., col. 86, ll. 52–54 (claim
293)—Paice argues that the Board erred in finding that
the ’817 application, standing alone, does not provide
adequate written description support. We do not address
that argument here. If, on remand, the Board concludes
that Severinsky fails to provide the requisite written
description support for the low current claims, the Board
should reconsider its finding that the ’817 application, on
its face, does not provide such support.
IV. CONCLUSION
For the reasons stated above, we affirm the Board’s
obviousness determinations as to claims 91–92, 112, 125–
26, 145, 252–53, 265–66, 278–79, 282, and 290–91 of the
’634 patent and claims 7, 17, 27, and 37–38 of the ’097
patent. We vacate, however, the Board’s determination
that claims 56–65, 68–77, 242–51, 268–77, 292–93, and
298 of the ’634 patent are obvious over the ’455 PCT
publication in view of Severinsky, and remand for pro-
ceedings consistent with this opinion.
AFFRIMED IN APPEAL NO. 17-1406
AFFIRMED IN PART, VACATED IN PART, AND
REMANDED IN APPEAL NOS. 17-1387, 17-1388,
17-1390, 17-1457, AND 17-1458
COSTS
No costs.