Google Inc. v. Simpleair, Inc.

NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
GOOGLE INC.,
Appellant
v.
SIMPLEAIR, INC.,
Appellee
______________________
2016-1901
______________________
Appeal from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in No. IPR2015-
00180.
______________________
Decided: March 28, 2017
______________________
JON WRIGHT, Sterne Kessler Goldstein & Fox, PLLC,
Washington, DC, argued for appellant. Also represented
by BRIAN LEE, MICHAEL V. MESSINGER, JOSEPH E.
MUTSCHELKNAUS.
JONAS BRAN JACOBSON, Dovel & Luner, LLP, Santa
Monica, CA, argued for appellee. Also represented by
JOHN JEFFREY EICHMANN, GREGORY S. DOVEL.
______________________
2 GOOGLE INC. v. SIMPLEAIR, INC.
Before DYK, CLEVENGER, and HUGHES, Circuit Judges.
CLEVENGER, Circuit Judge.
Google Inc. (“Google”) appeals the decision of the Pa-
tent Trial and Appeal Board (“PTAB”), following an inter
partes review (“IPR”), upholding the patentability of U.S.
Patent No. 8,601,154 (“the ’154 patent”), owned by Sim-
pleAir, Inc. (“SimpleAir”). The PTAB’s decision turned on
whether a certain prior art reference cited by Google, in
combination with other art, rendered the ’154 patent’s
claims obvious and therefore unpatentable. Under the
broadest reasonable interpretation (“BRI”) claim con-
struction standard, the PTAB concluded that Google’s
cited prior art reference did not teach a crucial claim
limitation. Without that limitation, Google’s obviousness
challenge failed, and the PTAB did not reach the addi-
tional pertinent questions of whether the proposed combi-
nation of references rendered the claims obvious. Google
timely appealed to this court.
Claim 1, the sole independent claim of the ’154 patent,
reads, in relevant part:
1. A method to transmit data from an information
source via a central broadcast server to remote
computing devices, the method comprising:
(a) generating data at the information
source, wherein the information source is
associated with an online service relating
to the generated data;
(b) identifying one or more users that have
subscribed to receive a notification relat-
ing to the generated data;
(c) transmitting the generated data to a
central broadcast server configured to pro-
cess the generated data . . . transmit the
processed data to receivers communica-
GOOGLE INC. v. SIMPLEAIR, INC. 3
tively coupled with remote computing de-
vices associated with subscribed users,
wherein the central broadcast server:
(i) comprises one or more servers
associated with a parser to parse
the generated data received from
the information source;
(ii) is communicatively coupled to
at least one information gate-
way . . . ; and
(iii) is communicatively coupled to
at least one transmission gate-
way . . . .
‘154 patent, claim 1.
The disputed term at issue on appeal is the “central
broadcast server.” The PTAB construed the term central
broadcast server, as a matter of the BRI standard, to
mean “one or more servers that are configured to receive
data from a plurality of information sources and process
the data prior to its transmission to one or more selected
remote computing device.”
Google asserts on appeal that the PTAB erred in its
BRI claim construction. According to Google, the correct
BRI construction for central broadcast server should not
be limited to receipt of data from a plurality of infor-
mation sources but, instead, should only require receipt
from one, or more, information sources. Under its pre-
ferred claim construction, wherein a central broadcast
server need only be configured to receive from a single
information source, Google’s cited prior art reference
would seem to teach a central broadcast server. There-
fore, if Google’s claim construction view prevails, the case
would require remand for further consideration of
Google’s obviousness challenge.
4 GOOGLE INC. v. SIMPLEAIR, INC.
SimpleAir argues that Google waived its opportunity
to assert its current claim construction because it failed to
articulate the same before the PTAB and, instead, actual-
ly agreed with the PTAB’s BRI interpretation of central
broadcast server.
For the reasons set forth below, we agree with Sim-
pleAir that Google waived the claim construction argu-
ment it now makes. Therefore, we sustain the PTAB’s
BRI construction. As it did before the PTAB, Google also
maintains that its cited prior art reference teaches a
central broadcast server even under the PTAB’s BRI of
“central broadcast server,” i.e., “configured to receive data
from a plurality of information sources.” Google argues
that the PTAB rejected its arguments because it misap-
plied its own claim construction, wrongfully importing
additional, unstated limitations. For the reasons below,
we disagree. Consequently, the PTAB’s conclusion that
Google fails to identify in the prior art a central broadcast
server must stand. Google’s obviousness challenge fails,
and we affirm the PTAB’s decision upholding the patent-
ability of the ’154 patent claims.
I
SimpleAir maintains that Google waived its argument
that the PTAB incorrectly construed central broadcast
server to require that it be configured to receive data
“from a plurality of information sources.” Some factual
context is necessary before discussing the waiver doctrine.
Google’s IPR was not the first occasion on which to
construe the term “central broadcast server.” In fact, in
three prior district court litigations, courts in the Eastern
District of Texas construed the term—the first two in-
volved related patents, within the same family as the ’154
patent, with a common specification; the third covered the
’154 patent directly. See SimpleAir, Inc. v. Apple Inc., No.
2:09-CV-289-CE, 2011 WL 3880525 (E.D. Tex. Sept. 2,
2011); SimpleAir, Inc. v. Microsoft Corp., No. 2:11-CV-
GOOGLE INC. v. SIMPLEAIR, INC. 5
0416-JRG, 2013 WL 2242163 (E.D. Tex. May 21, 2013);
SimpleAir, Inc. v. Google, Inc., No. 2:13-CV-0937-JRG,
2015 WL 1906016 (E.D. Tex. Apr. 27, 2015). In each of
these actions, the courts construed central broadcast
server to mean the same thing: “one or more servers that
are configured to receive data from a plurality of infor-
mation sources and process the data prior to its transmis-
sion to one or more selected remote computing device,” the
same construction ultimately applied by the PTAB.
Google filed its petition for IPR against the backdrop
of these district court constructions. Notwithstanding the
fact that the courts had previously applied the claim
construction standard outlined in Phillips v. AWH Corp.,
415 F.3d 1303 (Fed. Cir. 2005), rather than the BRI
standard employed by the PTAB, Google provided the
PTAB with the constructions applied by the district courts
for several claim terms, including central broadcast
server, with the requirement that it be configured to
receive data “from a plurality of information sources.”
Google made two statements in its petition perhaps
indicating some resistance to the district court construc-
tions. First, Google noted that “[t]he Board may, of
course, adopt a broader construction than those” reached
by the district court. Joint Appendix at 00142. Second,
Google stated “that the ‘central broadcast server’ in the
’154 patent receives data from ‘the information source’
instead of a plurality of information sources construed by
the district court regarding the [parent] patent.” 1 Id. at
1 Google filed its IPR petition on October 29, 2014,
before the district court issued its claim construction
order applying the same construction of central broadcast
server to the ’154 patent. SimpleAir, Inc. v. Google, Inc.,
No. 2:13-CV-0937-JRG, 2015 WL 1906016 (E.D. Tex. Apr.
27, 2015).
6 GOOGLE INC. v. SIMPLEAIR, INC.
00144. Google did not, however, insist or even request
that the PTAB apply a differing construction.
Consequently, in its Decision to Institute IPR, the
PTAB adopted the district court constructions, agreeing
with the parties that the constructions were “consistent
with the broadest reasonable interpretation of those
terms in light of the ’154 patent specification.” Joint
Appendix at 00293-94. In its discussion of the central
broadcast server claim element, the PTAB specifically
noted that the construction required a plurality of infor-
mation sources.
Throughout the remainder of the IPR proceedings,
there appeared to be no disagreement as to the construc-
tion of central broadcast server. SimpleAir argued that
Google’s cited prior art reference (“Yan”) did not teach one
or more servers configured to receive data from a plurality
of information sources, only one information source;
Google argued Yan did teach a configuration involving
multiple information sources. At the oral hearing, the
PTAB asked Google unequivocally about the district court
constructions:
JUDGE ARBES: Counsel, does the Petitioner
[Google] agree with all of the interpretations in
the District Court order? I believe it was Exhibit
3001.
MR. MESSINGER: Yeah, the Patent Owner—
Petitioner agrees with the District Court interpre-
tations that the Board relied on.
JUDGE ARBES: Okay. So if we were to agree
with the District Court’s analysis that that ap-
plies under broadest reasonable interpretation,
including the reasoning in that opinion, the Peti-
tioner agrees with that?
MR. MESSINGER: Yeah, Petitioner agrees with
that.
GOOGLE INC. v. SIMPLEAIR, INC. 7
Joint Appendix at 00656. Subsequently during the hear-
ing, unprompted by Google, the PTAB asked about the
language of claim 1 and whether it permits a single
information source, rather than necessarily requiring a
plurality of sources for a central broadcast server. Google
seemed to indicate its belief that a central broadcast
server could be configured to receive from only a single
information source, but maintained that, “even if you
consider a plurality of information sources, Yan teaches
that as well.” Joint Appendix at 00658-59. In its final
decision denying Google’s request to cancel the ’154
patent claims, the PTAB explained that the claim con-
structions were uncontested and that “Google agrees that
district court’s interpretations also represent the broadest
reasonable interpretation of the terms for purposes of this
proceeding,” citing the portion of the hearing transcript
quoted above. Joint Appendix at 00007.
We agree with SimpleAir that Google waived its ob-
jection to the PTAB’s construction of central broadcast
server. “[A] party may not introduce new claim construc-
tion arguments on appeal or alter the scope of the claim
construction positions it took below. Moreover, litigants
waive their right to present new claim construction dis-
putes if they are raised for the first time after trial.”
Conoco, Inc. v. Energy & Envtl. Int’l, L.C., 460 F.3d 1349,
1358–59 (Fed. Cir. 2006); see also In re Baxter Int’l, Inc.,
678 F.3d 1357, 1362 (Fed. Cir. 2012) (“Absent exceptional
circumstances, we generally do not consider arguments
that the applicant failed to present to the Board.” (inter-
nal citation omitted)). At no point did Google specifically
ask the PTAB to construe the claim term differently than
the district courts had. Indeed, on multiple occasions
Google expressly assented to the district court construc-
tions.
Google makes two arguments for why we should not
apply waiver in this case. Google first argues that it
sufficiently raised its present claim construction position
8 GOOGLE INC. v. SIMPLEAIR, INC.
before the PTAB, but the PTAB failed to acknowledge any
disagreement. “An issue is preserved for appeal . . . so
long as it can be said that the tribunal was fairly put on
notice as to the substance of the issue.” Nike, Inc. v.
Adidas AG, 812 F.3d 1326, 1342 (Fed. Cir. 2016) (internal
quotation marks omitted). Based on the facts already
outlined, we find Google’s contention that it “argued from
the very beginning” that central broadcast server “needs
to receive information only from a single information
source” to be unavailing. Google Reply Brief at 4–5. The
two comments made in its initial IPR petition were no
more than vague insinuations, seeds of doubt that Google
perhaps hoped would lead the PTAB to arrive at a differ-
ent construction on its own volition. They were insuffi-
cient to place SimpleAir and the PTAB on notice of
Google’s alternative view.
Moreover, Google’s statements during the oral hear-
ing, although more clearly indicating potential disagree-
ment regarding the central broadcast server construction,
also failed to sufficiently preserve the issue for appeal. It
does not appear Google would have even mentioned the
central broadcast server construction had one of the
PTAB judges not raised the issue sua sponte; in fact,
immediately prior to the discussion, Google proclaimed its
full support for adopting all of the district court construc-
tions. We cannot say these off-the-cuff arguments fairly
placed the PTAB on notice of Google’s contrary claim
construction view, or that the PTAB even recognized a
true dispute existed. In such circumstances, a finding of
waiver is warranted. See MCM Portfolio LLC v. Hewlett-
Packard Co., 812 F.3d 1284, 1294 n.3 (Fed. Cir. 2015)
(“MCM candidly admits that it only raised this argument
in a few scattered sentences at the oral hearing below. We
have found that ‘if a party fails to raise an argument
before the trial court, or presents only a skeletal or unde-
veloped argument to the trial court, we may deem that
argument waived on appeal.’ We deem MCM’s argument
GOOGLE INC. v. SIMPLEAIR, INC. 9
waived.” (quoting Fresenius USA, Inc. v. Baxter Int’l, Inc.,
582 F.3d 1288, 1296 (Fed. Cir. 2009))); Wallace v. Dep’t of
the Air Force, 879 F.2d 829, 832 (Fed. Cir. 1989) (“Ordi-
narily, appellate courts refuse to consider issues not
raised before an administrative agency. . . . [T]he issue
must be raised with sufficient specificity and clarity that
the tribunal is aware that it must decide the issue, and in
sufficient time that the agency can do so.”).
Google also maintains that it can appeal any issue
that was “actually decided” in the IPR proceedings, citing
Lifestyle Enterprise, Inc. v. United States, 751 F.3d 1371,
1377 (Fed. Cir. 2014). The statement made in Lifestyle
(as dicta and in a highly distinguishable factual setting)
does not apply here, where the PTAB did not engage in a
full claim construction analysis specifically because the
parties agreed that the district court claim constructions
should apply. Google cites no authority wherein a party
was permitted to pursue a new claim construction argu-
ment on appeal, after failing to raise it adequately with
the trial court or tribunal in the first instance.
“A party’s argument should not be a moving target.”
Finnigan Corp. v. Int’l Trade Comm’n, 180 F.3d 1354,
1363 (Fed. Cir. 1999). More specifically:
The argument at the trial and appellate level
should be consistent, thereby ensuring a clear
presentation of the issue to be resolved, an ade-
quate opportunity for response and evidentiary
development by the opposing party, and a record
reviewable by the appellate court that is properly
crystallized around and responsive to the asserted
argument.
Interactive Gift Exp., Inc. v. Compuserve Inc., 256 F.3d
1323, 1347 (Fed. Cir. 2001) (quoting Finnigan, 180 F.3d at
1363). Google failed to argue its proposed construction of
central broadcast server before the PTAB, thereby depriv-
10 GOOGLE INC. v. SIMPLEAIR, INC.
ing SimpleAir, the PTAB, and this court a meaningful
opportunity to address the merits of Google’s arguments.
We agree with SimpleAir that Google’s objection to
the PTAB’s claim construction of central broadcast serv-
er—i.e., that a central broadcast server need not be con-
figured to receive data from a plurality of information
sources—is barred by the doctrine of waiver. 2
II
Google also argues that the PTAB, when reviewing
the Yan reference to determine whether it taught a cen-
tral broadcast server, did not faithfully apply its own
construction.
First, Google argues that the PTAB imported an un-
stated requirement that the central broadcast server
receive data “directly” from a plurality of information
sources. Google argues that the PTAB’s determination
that Yan failed to teach a central broadcast server was
incorrect as a matter of law because of the PTAB’s reli-
ance on this implicit “direct” receipt limitation that is
absent from the claim construction.
We reject Google’s mischaracterization of the PTAB’s
ruling, in attempt to create legal error. While it was
indeed Google’s position during the IPR that Yan taught
servers configured to receive data indirectly from a plural-
ity of information, the PTAB was not persuaded by and
rejected the argument. The PTAB did not, however,
create a requirement that a central broadcast server
receive data directly from the information sources. In-
stead, the PTAB found that Yan described a server “con-
2 SimpleAir also argued that Google’s claim con-
struction arguments were barred by judicial estoppel.
Because we find waiver applies, we decline to reach this
argument.
GOOGLE INC. v. SIMPLEAIR, INC. 11
figured to receive all Netnews data from a single infor-
mation source – a local host.” Joint Appendix at 00014.
“What a reference teaches is a question of fact.” In re
Beattie, 974 F.2d 1309, 1311 (Fed. Cir. 1992). We find no
legal error in the PTAB’s review of Yan’s teachings and
uphold its factual determination as supported by substan-
tial evidence.
Second, Google argues that the PTAB imported an-
other unnecessary requirement that multiple servers
must be “interconnected” in order to function together as a
central broadcast server. Google maintains that Yan
teaches individual servers that receive data from individ-
ual information sources, and together they would consti-
tute a central broadcast server, but for the PTAB’s
improper requirement that the servers be interconnected.
Again, we disagree that the PTAB implied an un-
called-for limitation. The PTAB explained that “Google
has not explained sufficiently how two separate servers,
each of which is configured to receive data from a differ-
ent single information source, disclose a central broadcast
server, which must be configured to receive information
from multiple information sources.” Joint Appendix at
00019. The PTAB did not affirmatively require that
separate servers be interconnected in order qualify as a
central broadcast server. Rather, it found that Google
failed to satisfy its burden of proof to show that the indi-
vidual servers described in Yan were indeed “configured
to receive data from a plurality of information sources,”
despite seemingly being entirely independent (not inter-
connected, not networked, etc.). This finding is supported
by substantial evidence.
The PTAB certainly did not require that, to be a cen-
tral broadcast server, individual constituent servers
specifically must be “interconnected.” But even assuming
that the PTAB did imply an additional limitation requir-
ing some sort of relationship among individual servers, we
12 GOOGLE INC. v. SIMPLEAIR, INC.
find such a requirement appropriate. The ’154 patent
itself describes “a network of servers 33 in the central
broadcast server 34, such as the FTP server 102 and the
SMTP server 104 illustrated in FIG. 2.” ’154 patent, col. 8
ll. 9–15 (emphasis added). Nothing in the ’154 patent
supports the view that two unrelated servers would
constitute a central broadcast server. To the extent it did
so, the PTAB was justified in reading in a relationship
requirement to prevent the untenable result that “any
two separate servers would be a central broadcast server
no matter how they are configured or related to one
another.” Joint Appendix at 00019.
CONCLUSION
For the reasons set forth above, we affirm the PTAB’s
decision.
AFFIRMED
COSTS
No costs.