Inre: Teles Ag Information

United States Court of Appeals
for the Federal Circuit
______________________
IN RE TELES AG
INFORMATIONSTECHNOLOGIEN AND SIGRAM
SCHINDLER BETEILIGUNGSGESELLSCHAFT
MBH
______________________
2012-1297
______________________
Appeal from the United States Patent and Trademark
Office, Board of Patent Appeals and Interferences in
Reexamination No. 90/010, 017.
______________________
Decided: April 4, 2014
______________________
MICHAEL D. KAMINSKI, Foley & Lardner LLP, of
Washington, DC, argued for appellants. With him on the
brief were HOWARD N. SHIPLEY, GEORGE E. QUILLIN, and
RYAN A. SCHMID.
AMY J. NELSON, Associate Solicitor, Office of the Solic-
itor, United States Patent and Trademark Office, of
Arlington, Virginia argued for appellee. With her on the
brief was NATHAN K. KELLEY, Deputy Solicitor. Of counsel
was SCOTT C. WEIDENFELLER, Associate Solicitor.
FRANK E. SCHERKENBACH, Fish & Richardson, P.C., of
Boston, Massachusetts for amicus curiae. Of counsel on
the brief was CRAIG E. COUNTRYMAN, of San Diego, Cali-
2 IN RE: TELES AG INFORMATION
fornia; and HOWARD G. POLLACK and MICHAEL R.
HEADLEY, of Redwood City, California.
______________________
Before DYK, MOORE, and WALLACH, Circuit Judges.
DYK, Circuit Judge.
Teles AG Informationstechnologien and Sigram
Schindler Beteiligungsgesellschaft MBH (collectively,
“Teles”) own all substantial rights in U.S. Patent No.
6,954,453 (“the ’453 patent”) on a method and apparatus
for transmitting data in a telecommunications network.
The Patent and Trademark Office (“PTO”) conducted an
ex parte reexamination of the ’453 patent and rejected
claims 34–36 and 38 as obvious under 35 U.S.C. § 103.
The Board of Patent Appeals and Interferences (“Board”)
affirmed. Teles brought suit in the United States District
Court for the District of Columbia, challenging the
Board’s decision pursuant to 35 U.S.C. § 145 (2006). We
agree with the district court that it lacked subject matter
jurisdiction, and hold that the version of § 145 in effect at
the time did not authorize a patent owner in an ex parte
reexamination to bring suit in district court challenging
the Board’s action. But we hold that the district court
erred in dismissing the case and instead should have
transferred the case as it attempted to do after the dis-
missal. We treat the case as having been transferred to
this court and consider it as an appeal from the Board’s
decision. We affirm the Board’s rejection of claim 35 as
obvious under § 103.
BACKGROUND
I
In 1980, Congress established a system of ex parte
reexamination that allowed patent owners and third
parties to ask the PTO to reexamine claims of issued
patents in view of prior art. See An Act to Amend the
IN RE: TELES AG INFORMATION 3
Patent and Trademark Laws, Pub. L. No. 96-517, 94 Stat.
3015 (1980) (codified at 35 U.S.C. §§ 302–07 (1986)). We
have recognized the “important public purpose” behind
reexamination as “part of a larger effort to revive United
States industry’s competitive vitality by restoring confi-
dence in the validity of patents issued by the PTO.” Patlex
Corp. v. Mossinghoff, 758 F.2d 594, 601 (Fed Cir. 1985);
see also H.R. Rep. No. 96-1307(I), at 3 (1980), reprinted in
1980 U.S.C.C.A.N. 6460, 6462 (describing the goal of
“strengthen[ing] investor confidence in the certainty of
patent rights by creating a system of administrative
reexamination of doubtful patents”).
Section 145 has long authorized patent applicants to
challenge the Board’s adverse examination decisions in
district court instead of directly appealing to this court
pursuant to 35 U.S.C. § 141. See Kappos v. Hyatt, 132 S.
Ct. 1690, 1694 (2012). After the reexamination statute
was enacted, we allowed patent owners to challenge
adverse ex parte reexamination decisions in district court
pursuant to § 145. See Joy Techs., Inc. v. Manbeck, 959
F.2d 226, 227 (Fed. Cir. 1992). In 1999, Congress amend-
ed § 145 and related provisions. This case raises the
question of whether § 145 civil actions remained available
to patent owners seeking to challenge adverse reexamina-
tion decisions after Congress amended the statute in 1999
and before 2011, when Congress amended the statute to
clarify that § 145 review was not available to patent
owners.
II
Teles is the owner of the ’453 patent, which issued on
October 11, 2005. ’453 patent, at [45]. The ’453 patent
recites a “method for transmitting data in a telecommuni-
cations network and switch for implementing said meth-
od.” Id. at [54]. In August 2007, a third party filed a
request that the PTO conduct an ex parte reexamination
of the ’453 patent. The examiner rejected claims 34–36
4 IN RE: TELES AG INFORMATION
and claim 38 under 35 U.S.C. § 103 as obvious over U.S.
Patent No. 6,069,890 (“White”) combined with either U.S.
Patent No. 6,137,792 (“Jonas”) or U.S. Patent No.
4,996,685 (“Farese”). Teles appealed the rejections to the
Board, which affirmed. Teles then sought review of the
Board’s decision in the United States District Court for
the District of Columbia pursuant to § 145. The district
court dismissed the case for lack of subject matter juris-
diction, holding that, after the 1999 amendments, § 145
proceedings could not be maintained by patent owners.
Teles appealed the district court’s dismissal for lack of
subject matter jurisdiction to this court pursuant to 28
U.S.C. § 1295(a)(1). Teles did not appeal the Board’s
decision to this Court.
DISCUSSION
I
We address initially the question of jurisdiction.
While we have jurisdiction to review the district court’s
dismissal pursuant to § 1295(a)(1), the question is wheth-
er we also have jurisdiction to review the Board’s action
(if the district court lacked jurisdiction). After the district
court granted the motion to dismiss, it also purported to
transfer the case to this court pursuant to 28 U.S.C.
§ 1631. A transfer “is not proper when combined with a
dismissal.” Hollyanne Corp. v. TFT, Inc., 199 F.3d 1304,
1307 (Fed. Cir. 1999); see also Christianson v. Colt Indus.
Operating Corp., 486 U.S. 797, 818 (1988). Once the
district court dismissed the case for lack of jurisdiction, it
“was without authority to transfer the case.” Tootle v.
Sec’y of Navy, 446 F.3d 167, 173 (D.C. Cir. 2006).
But we hold that the district court erred in dismissing
the case rather than transferring it. Once the district
court held that it lacked jurisdiction, it should have
transferred the case pursuant to § 1631. See Paul v.
I.N.S., 348 F.3d 43, 47 (2nd Cir. 2003); see also Kolek v.
IN RE: TELES AG INFORMATION 5
Engen, 869 F.2d 1281, 1283–84 (9th Cir. 1989). Here, as
in Paul and Kolek, the statutory deadline for filing an
appeal to this court had passed, and no evidence suggest-
ed bad faith in Teles’ filing with the district court. Under
these circumstances, it was in the interest of justice to
transfer the case pursuant to § 1631, and we “treat
[Teles’] petition for review, which was timely filed with
the district court, as if it had been properly transferred” to
this court rather than dismissed. Paul, 348 F.3d at 47
(citing Miller v. Hambrick, 905 F.2d 259, 262 (9th Cir.
1990) (district court correctly determined that it lacked
jurisdiction but abused its discretion in failing to consider
whether transfer was in the interest of justice)); see also
Kolek, 869 F.2d at 1284 (treating dismissal as transfer
where appellate court had exclusive jurisdiction and
timely filing deadline had passed); In re McCauley, 814
F.2d 1350, 1352 (9th Cir. 1987) (reviewing merits of
dismissed appeal as if properly transferred to appellate
court).
In reviewing the case as though the district court had
transferred the case, we address (1) the district court’s
jurisdiction, and (2) if the district court lacked jurisdic-
tion, the Board’s decision on the merits. We review both
the district court’s dismissal for lack of jurisdiction and
the question of statutory interpretation underlying that
dismissal de novo. Mudge v. United States, 308 F.3d 1220,
1224 (Fed. Cir. 2002) (citing Strickland v. United States,
199 F.3d 1310, 1313 (Fed. Cir. 1999) and Muniz v. United
States, 972 F.2d 1304, 1309 (Fed. Cir. 1992)). We review
the Board’s decisions de novo for errors of law and for
substantial evidence as to questions of fact. In re En-
hanced Sec. Research, LLC, 739 F.3d 1347, 1351 (Fed. Cir.
2014) (citing In re Baxter Int’l, Inc., 678 F.3d 1357, 1361
(Fed. Cir. 2012)).
6 IN RE: TELES AG INFORMATION
II
On its face, even before the 1999 amendments, § 145
only provided for district court actions brought by patent
“applicants.” Nonetheless, in Joy Technologies, we con-
strued § 145 as applicable to a “patent owner” involved in
an ex parte reexamination. 959 F.2d at 229. This construc-
tion of the statute was continued in later cases. See
Takeda Pharm. Co., Ltd. v. Doll, 561 F.3d 1372 (Fed. Cir.
2009); In re Lueders, 111 F.3d 1569, 1577, n.14 (Fed. Cir.
1997); Boeing Co. v. Comm’r of Patents & Trademarks,
853 F.2d 878, 881 (Fed. Cir. 1988).
In 1999, Congress amended the Patent Act to create a
system of inter partes reexamination that allowed third
parties who had requested the reexamination to partici-
pate actively in the PTO reexamination process. 1 When
Congress created the inter partes reexamination system,
it changed the text of existing statutory provisions, in-
cluding §§ 134, 141, and 145. The district court concluded
that these changes made § 145 unavailable to patent
owners (as opposed to patent applicants).
First, Congress amended § 141, which provided for
appeals of Board decisions to this court, by inserting an
express limitation on the appeal rights of patent owners
in any reexamination proceeding: “A patent owner in any
1 See American Inventors Protection Act (“AIPA”),
enacted as part of the Intellectual Property and Commu-
nications Omnibus Reform Act of 1999, Pub. L. No. 106-
113, 113 Stat. 1501 (1999); 35 U.S.C. §§ 311, 316; see also
145 Cong. Rec. H6944 (1999) (statement of Rep. Dana
Rohrabacher) (describing legislative effort to “further
encourage potential litigants to use the PTO as a[n]
avenue to resolve patentability issues . . . [by] creat[ing]
an additional reexam option that permits a 3rd party
requestor to file additional written briefs”).
IN RE: TELES AG INFORMATION 7
reexamination proceeding dissatisfied with the final
decision in an appeal to the Board of Patent Appeals and
Interferences under section 134 may appeal the decision
only to the United States Court of Appeals for the Federal
Circuit.” 35 U.S.C. § 141 (2000) (emphases added).
Second, Congress changed the substance and struc-
ture of § 134, governing appeals to the Board. Before
1999, § 134 mentioned only patent applicants: “An appli-
cant for a patent, any of whose claims has been twice
rejected, may appeal from the decision of the primary
examiner to the Board of Patent Appeals and Interfer-
ences, having once paid the fee for such appeal.” 35 U.S.C.
§ 134 (1994). As amended, the section for the first time
addressed patent applicants, patent owners, and third
party requesters individually, as follows:
a) PATENT APPLICANT.—An applicant for a
patent, any of whose claims has been twice reject-
ed, may appeal from the decision of the adminis-
trative patent judge to the Board of Patent
Appeals and Interferences, having once paid the
fee for such appeal.
(b) PATENT OWNER.—A patent owner in
any reexamination proceeding may appeal from
the final rejection of any claim by the administra-
tive patent judge to the Board of Patent Appeals
and Interferences, having once paid the fee for
such appeal.
(c) THIRD-PARTY.—A third-party requester
in an inter partes proceeding may appeal to the
Board of Patent Appeals and Interferences from
the final decision of the administrative patent
judge favorable to the patentability of any original
or proposed amended or new claim of a patent,
having once paid the fee for such appeal. The
third-party requester may not appeal the decision
of the Board of Patent Appeals and Interferences.
8 IN RE: TELES AG INFORMATION
35 U.S.C. § 134 (2000). 2
Third, Congress amended § 145, which previously ref-
erenced § 134 generally, to refer only to § 134(a), govern-
ing patent applicants:
An applicant dissatisfied with the decision of the
Board of Patent Appeals and Interferences in an
appeal under section 134(a) of this title may, un-
less appeal has been taken to the United States
Court of Appeals for the Federal Circuit, have
remedy by civil action against the Director in the
United States District Court for the District of Co-
lumbia . . . .
35 U.S.C. § 145 (2000) (emphasis added). On their face,
these amendments would appear to restrict § 145 appeals
to patent applicants. However, Teles argues that § 145
continued to be available to patent owners.
Teles’ first argument is that the phrase in § 141 stat-
ing that a patent owner “may appeal the [adverse reexam-
ination] decision only to the United States Court of
Appeals for the Federal Circuit” does not preclude an
owner from invoking the provisions of §§ 145 and 306
because a civil action under § 145 is not an “appeal.”
Under Teles’ interpretation, the “only” restriction limits
patent owners’ appeals to this court as opposed to other
circuit courts and does not limit the availability of § 145
district court review to patent owners. But this reading
makes the provision entirely superfluous because this
court already had exclusive jurisdiction over decisions of
the Board. 28 U.S.C. § 1295 (a)(4)(A) (1994). Significantly,
§ 141 did not subject patent applicants to a similar limita-
tion, stating that “[a]n applicant dissatisfied with the
2 In 2002, Congress amended § 134, substituting
“primary examiner” for “administrative patent judge.” 35
U.S.C § 134 (2006).
IN RE: TELES AG INFORMATION 9
decision in an appeal to the Board of Patent Appeals and
Interferences under section 134 of this title may appeal
the decision to the United States Court of Appeals for the
Federal Circuit.” 35 U.S.C. § 141 (2000) (emphasis added).
If the “only” limitation were designed to restrict appeals
to this court, rather than other circuit courts, it is hard to
understand why Congress would not employ similar
language as to patent applicants.
Teles’ second argument is that the conclusion that the
1999 amendments restricted § 145 to patent applicants is
inconsistent with the language of § 306, pertaining to
appeals by patent owners in ex parte reexaminations.
After the 1999 amendments, § 306 continued to read:
The patent owner involved in a reexamination
proceeding under this chapter may appeal under
the provisions of section 134 of this title, and may
seek court review under the provisions of section
141 to 145 of this title, with respect to any decision
adverse to the patentability of any original or pro-
posed amended or new claim of the patent.
35 U.S.C. § 306 (2000) (emphasis added). Teles argues
that the reference in § 306 to “the provisions of section
141 to 145” shows that § 145 continues to be available to
patent owners. But this inconsistency in retaining a
reference to § 145 in § 306 does not undermine the clear
intention of the 1999 amendments to eliminate § 145 as to
patent owners.
In Chickasaw Nation v. United States, the Supreme
Court considered a similar question involving an apparent
contradiction between statutory language and an internal
cross-reference. 534 U.S. 84 (2001). There, the question
was whether Indian tribes were exempt from paying
certain taxes. One subsection of the statute stated that
“Internal Revenue Code provisions that ‘concer[n] the
reporting and withholding of taxes’ with respect to gam-
bling operations shall apply to Indian tribes in the same
10 IN RE: TELES AG INFORMATION
way as they apply to the States,” but also stated “in its
parenthetical that those provisions ‘includ[e]’ Internal
Revenue Code ‘chapter 35.’” Id. at 87 (alterations in
original). Chapter 35, however, said “nothing about the
reporting or withholding of taxes, [but] simply impose[d]
taxes . . . from which it exempt[ed] certain state-
controlled gambling activities.” Id. The Indian tribes
claimed that the chapter 35 reference exempted them
from paying taxes from which states were similarly
exempt. Id.Faced with this apparent contradiction, the Supreme
Court held that “[t]he language of the statute is too strong
to bend as the Tribes would wish—i.e., so that it gives the
chapter 35 reference independent operative effect.” Id. at
89. The Court explained that “the language outside the
parenthetical is unambiguous. It says without qualifica-
tion that the subjection applies to ‘provisions . . . concern-
ing the reporting and withholding of taxes.’” Id. In light of
such strong and unambiguous language, making the
chapter 35 reference effective on its own would have
required “seriously rewriting the language of the rest of
the statute.” Id. Rather than reach that result, the Court
concluded that “in context, common sense suggests that
the cross-reference is simply a drafting mistake,” and that
Congress “unintentionally failed to remove what had
become a superfluous numerical cross-reference.” Id. at
91, 92. The same is evidently true here with respect to the
retention of the cross-reference to § 145 in § 306.
The fact that in the case of an inter partes reexamina-
tion, § 315, as of the time of the 1999 amendments, pro-
vided for an appeal by the patent owner “under the
provisions of sections 141 through 144,” 35 U.S.C.
§ 315(a)(1) (2000), merely confirms the likelihood that the
reference to § 145 in § 306 was a drafting error. Moreover,
the fact that § 145 on its face applied only to “applicants”
and not owners helps to explain why Congress could have
failed to focus on the drafting error in § 306.
IN RE: TELES AG INFORMATION 11
Teles argues, however, that here, legislative history
demonstrates that Congress deliberately retained the
reference to § 145 in § 306. Teles points out that bills
proposed before 1999 would have amended § 306 to elimi-
nate the reference to § 145, and that these bills were not
adopted. This does not assist Teles. As the Supreme Court
held in Solid Waste Agency of N. Cook Cnty. v. U.S. Army
Corps of Eng’rs, reliance on failed legislative proposals is
disfavored as a means of inferring legislative intent. 531
U.S. 159, 169 (2001).
Teles also relies on the fact that during consideration
of the 1999 amendments, one of the bills proposed to
amend § 306 by eliminating the reference to § 145. See
American Inventors Protection Act of 1999, H.R. 1907
106th Cong. (as introduced); see also H. Rep. 106-287(I),
at 59–60 (Aug. 3, 1999) (describing proposed changes to
§ 306). But the proposed section made an even more
significant change: it gave third party requesters in inter
partes examinations the right to appeal Board decisions to
this court or to become parties in appeals taken by patent
owners. When the bill was reported out of the House
Judiciary Committee, this provision was removed. 3 The
debate on the provision suggests nothing about a decision
to retain § 145 for patent owners, but demonstrates that
the provision was removed because of opposition to giving
appeal rights to third parties in ex parte examinations.
During the House debate over the bill, Representative
Lofgren asked about this change, but only with respect to
the removal of third parties’ appeal rights. 145 Cong. Rec.
6942 (statement of Rep. Zoe Lofgren). The response to
3 Although third parties in inter partes examina-
tions were given the right to appeal to this court in 2002,
Pub. L. 107-273 § 13106(c), such appeals remain unavail-
able to third parties in ex parte examinations. See 35
U.S.C. § 141 (2012).
12 IN RE: TELES AG INFORMATION
Representative Lofgren’s question similarly focused on
the impact it would have on the rights of third party
requesters, not patent owners. See 145 Cong. Rec. H6942
(statement of Rep. Coble) (explaining that the change
“was done for the benefit of the independent inventors to
balance the interest of a third party with those of a . . .
patentee, by allowing a third party to pursue reexamina-
tion . . . while assuring that a patentee would not be
subject to harassment in such proceedings”). There was no
suggestion that the provision was rejected in an attempt
to retain § 145 review for patent owners. 4
The only specific reference to the appeal rights of pa-
tent owners is Senator Lott’s statement that “[t]he pa-
tentee is not entitled to the alternative of an appeal of an
inter partes reexamination to the U.S. District Court for
the District of Columbia. Such appeals are rarely taken
from ex parte reexamination proceedings under existing
law and its removal should speed up the process.” 145
Cong. Rec. S14720. Interestingly, Senator Lott viewed the
amendment to § 141 discussed above as precluding § 145
review: “a patent owner in a reexamination proceeding
may appeal an adverse decision . . . only to the U.S. Court
of Appeals for the Federal Circuit as earlier noted.” Id. at
4 Teles’ other references to statements during floor
debates do not show that the § 145 reference remained
because of legislative intent rather than inadvertence.
See, e.g., 145 Cong. Rec. H6942 (statement of Rep. Zoe
Lofgren) (“[T]he bill was amended to retain existing law
for ex parte reexaminations . . . .”); 145 Cong. Rec. S14720
(statement of Sen. Trent Lott) (“Subtitle F leaves existing
ex parte reexamination procedures in Chapter 30 of title
35 intact.”). These statements do not say anything about
the appeal rights of patent owners after completion of the
reexamination.
IN RE: TELES AG INFORMATION 13
S14721. These statements hardly indicate a desire to
retain § 145 review for patent owners.
Finally, Teles argues that the 2011 amendments to
§ 306 show that the 1999 amendments left the appeal
rights of patent owners intact. When Congress enacted
the America Invents Act in 2011, it amended § 306 by
limiting patent owners to review “under the provisions of
sections 141 to 144.” See Leahy-Smith America Invents
Act (“AIA”), Pub. L. No. 112-129, 125 Stat. 284 (2011)
(codified as amended at 35 U.S.C. § 306 (2011)). The 2011
amendments thus removed the cross-reference to § 145 in
§ 306 (but were not retroactive). Teles argues that this
change demonstrates that § 306 before the changes pre-
served § 145 for patent owners.
Teles’ theory contradicts the legislative history, which
recognized that the amendments corrected a drafting
error in the 1999 legislation: Ҥ 306 is amended to con-
form to the changes made by § 4605 of the American
Inventors Protection Act of 1999, Public Law 106-113 to
§§ 134 and 141 of Title 35.” H.R. Rep No. 112-98(I), at 77
(2011) (Statement of Rep. Smith) (June 1, 2011); see also
157 Cong. Rec. S1377 (daily ed. Mar. 8, 2011) (statement
of Sen. Kyle) (“It is fairly apparent, however, that [the
authority for a patent owner to bring a civil action under
§ 145] was intended to be eliminated by the amendments
made by section 4605 of the American Inventors Protec-
tion Act of 1999, Public Law 106-113, to sections 134 and
141 of Title 34 . . . . The AIPA neglected, however, to
eliminate a cross reference to section 145 in section 306 of
Title 35 . . . .”). Amendments intended to clarify statutory
language do not indicate that the original language
should be construed to mean the opposite of the clarifying
language. See Jerman v. Carlisle, McNellie, Rini, Kramer
& Ulrich LPA, 559 U.S. 573, 591 & n.12 (2010) (referenc-
ing statements in legislative history as evidence that
amendment intended to clarify, rather than change, the
scope of existing statutory provision). The 2011 amend-
14 IN RE: TELES AG INFORMATION
ments do not manifest Congress’ intent to preserve the
availability of § 145 in the earlier version of the section.
We therefore hold that the 1999 amendments elimi-
nated the right of patent owners to secure review under
§ 145, and affirm that the district court lacked jurisdiction
over the § 145 action.
III
We turn next to Teles’ appeal of the Board’s rejection
of claim 35. 5 This claim was rejected on the ground that
the claim would have been obvious.
A. Claim Construction
Teles argues that the Board’s decision rests on an in-
correct claim construction. During reexamination, the
PTO must give claims their “broadest reasonable con-
struction consistent with the specification.” In re ICON
Health & Fitness, Inc., 496 F.3d 1374, 1379 (Fed. Cir.
2007). We review de novo the Board’s claim construction
to determine if it gives claims their broadest reasonable
construction. Rambus v. Rea, 731 F.3d 1248, 1252 (Fed.
Cir. 2013); see also In re Abbott Diabetes Care Inc., 696
F.3d 1142, 1148 (Fed. Cir. 2012).
Claim 35 depends on independent claim 34, which re-
cites a “[s]witching apparatus for routing a telephone
call . . . selectively by line switching or packet switch-
ing.” ’453 patent col. 14 ll. 48–53. Dependent claim 35
reads:
35. The switch of claim 34,[ 6] further compris-
ing means to produce the control signal for trans-
5 The Board also rejected claims 34, 36, and 38, but
Teles does not challenge these rejections on appeal.
6 The full text of claim 34 reads:
IN RE: TELES AG INFORMATION 15
ferring to a line-switching transfer or a packet-
switching transfer to the second end terminal,
said control signal being produced automatically
34. Switching apparatus for routing a tele-
phone call comprising non-packetized data from a
first end terminal located at a user’s premises to a
second end terminal located at another user’s
premises, selectively by line switching or packet
switching, the switching apparatus comprising:
means for establishing a connection through a
line-switching network to the second end termi-
nal;
means for line-switching transferring data re-
ceived from the first end terminal as non-
packetized data over the line-switching network to
the second end terminal;
means for establishing a connection through a
packet-switching network to the second end ter-
minal;
means for packet-switching transferring data re-
ceived from the first end terminal as non-
packetized data over the packet-switching net-
work to the second end terminal; and
means responsive to a control signal for transfer-
ring to a line-switching transfer or a packet-
switching transfer to the second end terminal;
said means responsive to a control signal chang-
ing-over to a line switching data transfer or a
packet-switching transfer during the existing
transfer with the presence of said control signal.
’453 patent col. 14 l. 48 to col. 15 l. 4.
16 IN RE: TELES AG INFORMATION
when demands on the quality of the data transfer
are understepped or exceeded.
’453 patent col. 15 ll. 5–10.
Claim 35 pertains to the utilization of line switching
and packet switching in routing telephone calls. Line
switching and packet switching are two different types of
telecommunications technologies. In line switching, “a
connection is continually provided in real time with the
complete bandwidth of a channel between two points”
reserved for that connection. Id. col. 1 ll. 39–41. The fixed
bandwidth allows for communications that are “free of
any time delays,” but can be “expensive, particular-
ly during telephone conversations since the costs accumu-
late irrespectively of the information actually
transferred.” Id. col. 1 ll. 44–48. Packet switching oper-
ates “quite differently from line-switching exchanges, [in
that] a fixed connection does not have to be main-
tained . . . i.e., each packet is treated individually and not
in conjunction with others.” Id. col 1. ll. 33–34, 56–59. The
Internet is an example of a network that uses packet
switches (routers) to transfer data. Id. col. 1. ll. 60–67.
Although packet-switching can provide connections cheap-
ly, it can also produce significant time delays. Id. col. 2.
ll. 3–7, 15–21. Claim 35 is directed to a device for switch-
ing from a packet-switched network to a line-switched
network “automatically when demands on the quality of
the data transfer are understepped or exceeded.” Id.col. 15 ll. 5–10.
The Board construed the claimed “means to produce
the control signal” under § 112 ¶ 6 (now § 112(f)). Section
112 ¶ 6 provides that functional claim language, like the
“means to produce the control signal” element of claim 35,
“shall be construed to cover the corresponding structure,
material, or acts described in the specification and equiva-
lents thereof.” 35 U.S.C. § 112 ¶ 6 (2006). The Board
defined the function as “produc[ing] the control signal for
IN RE: TELES AG INFORMATION 17
transferring to a line-switching or a packet-switching
transfer to the second end terminal.” J.A. 1435. The
Board agreed with the examiner that, in order to release a
control signal, the claim required monitoring factors
related to demands of quality, but did not limit those
factors to include only the bandwidth of a particular
transfer. The Board explained that “by using the broad
term ‘demands of quality,’ claim 35 is not limited to the
‘bandwidth of a transfer,’” and that the time delay of a
transmission was an example of a “quality factor.” J.A.
1435. The Board found that the structure corresponding
to the claimed means was the change-over device, identi-
fied in Figure 4 by label 711.
While Teles’ argument is not entirely clear, it appears
that Teles argues that the Board erred by not construing
the function of claim 35 to be defined by the description of
structure in the following portion of the specification:
Alter[n]atively, it can also be possible for the
change-over control device 711 to monitor the
bandwidth of a transfer and on understepping or
exceeding a certain bandwidth and/or in the event
of a time delay when forwarding IP data packets
to automatically release a control command to
change over to the relevant other type of transfer.
’453 patent col. 9 ll. 36–42. Teles contends that this pas-
sage requires that the function include monitoring the
bandwidth of the packet-switched network in connection
with the transfer. But the fact that the specification
describes monitoring bandwidth as an alternative possi-
bility for producing a change-over command does not
support construing that function to match the alternative
function disclosed in the specification rather than the
recitation in the claim.
When construing functional claims under § 112 ¶ 6,
“[t]he statute does not permit limitation of a means-plus-
function claim by adopting a function different from that
18 IN RE: TELES AG INFORMATION
explicitly recited in the claim.” Micro Chem., Inc. v. Great
Plains Chem. Co., 194 F.3d 1250, 1258 (Fed. Cir. 1999)
(“[T]he district court erred . . . by incorporating unrecited
functional limitations into the claims.”); see also Globe-
trotter Software, Inc. v. Elan Computer Grp., 236 F.3d
1363, 1367 (Fed. Cir. 2001) (The structure disclosed in the
specification must be necessary to perform “the function
described in the claim.”) (citing Micro Chem., 194 F.3d at
1258). Even if the passage in the specification relied on by
Teles were relevant to construing the claim language, it
does not support a different claim construction. The
passage states that a control signal could be released
automatically on “understepping or exceeding a certain
bandwidth and/or in the event of a time delay when
forwarding IP data packets.” ’453 patent col. 9 ll. 35–40.
On its face, this language (using “and/or”) describes two
factors—bandwidth and time delay—as potential alterna-
tives for producing a change-over command; it does not
suggest that bandwidth monitoring is necessary to per-
form that function. The Board did not err in its claim
construction.
Finally, Teles argues that the Board’s claim construc-
tion is erroneous in light of its alleged inventive concept
as defined by the inventor (monitoring the bandwidth of a
particular transfer). Teles argues that “the Supreme
Court’s Mayo decision requires that the ‘inventive con-
cepts’ embodied by the claimed invention be identified as
part of construing claims.” Reply Br. 5 (citing Mayo Col-
laborative Servs. v. Prometheus Labs., Inc., 132 S. Ct.
1289, 1294 (2012)). But the Court in Mayo referred to an
“inventive concept” only in the context of § 101 patent-
eligibility analysis, and specifically in the context of
ensuring that a process “amounts to significantly more
than a patent upon the natural law” which its steps
invoke. Mayo, 132 S. Ct. at 1294. Requiring claims to
recite an inventive concept does not mean that claims
must be construed in light of unspecified inventive con-
IN RE: TELES AG INFORMATION 19
cepts. Mayo simply does not speak to claim construction.
The inventive concept aspect of its discussion has no
bearing on claim construction.
B. Obviousness
Obviousness is a question of law that we review de
novo, but it rests upon factual determinations that we
review for substantial evidence. In re Baxter Int’l, Inc.,
678 F.3d at 1361 (Fed. Cir. 2012) (citing In re Kotzab, 217
F.3d 1365, 1369 (Fed. Cir. 2000)).
The Board upheld the examiner’s rejection of claim 35
(as well as claims 34, 36 and 38) as obvious in view of
White combined with either Jonas or Farese. White
“relates to an Internet telephone service where calls can
be made over the Internet from telephone to telephone,
telephone to computer, or computer to telephone.” J.A.
1411 (citing ’890 patent col. 4 ll. 5–24). Farese relates to a
technique for dynamically changing between packet and
circuit switching in Integrated Services Digital Network
(ISDN) communications. Jonas’ system and method
“enables data packets to be transmitted over a bypass
[line]-switched telephone network between two computers
connected to a public packet-switched network, such as
the Internet.” J.A. 1413 (citing ’792 patent col. 1 ll. 8–12).
Jonas further discloses that the bypass network could be
used to avoid time delays associated with packet switch-
ing. The Board affirmed the examiner’s finding that “‘it
was well known in the art to change over to [] line-
switching or packet-switching during an existing transfer
during a communication in response to a control signal,’
as disclosed by Farese and Jonas.” J.A. 1427.
Although White did not itself disclose changing be-
tween line-switched and packet-switched connections
during an ongoing communication, the Board agreed with
the examiner “that it would have been obvious to modify
White to allow a change-over . . . during an existing
transfer, as explicitly taught by Jonas and Farese.” J.A.
20 IN RE: TELES AG INFORMATION
1428. Moreover, this modification “would dynamically
take advantage of both the inherent cost benefit of using
the packet-switched Internet and the minimal time delay
of [line]-switched telephone network.” J.A. 1428. Accord-
ing to the examiner, this benefit explained “why one of
ordinary skill in the art would combine the teachings of
White and Jonas and Farese.” J.A. 1429. With respect to
claim 35, the Board agreed with the examiner that Jonas
disclosed changing to a line-switched network when
transmission delays are detected and thus “discloses
‘producing a control signal automatically when the de-
mands of quality are understepped or exceeded.’” J.A.
1435.
Teles challenges the conclusion of obviousness on the
grounds that the prior art references do not disclose all of
the recited limitations of claim 35. Teles’ main objection is
to Jonas, specifically, that it discloses a method of calcu-
lating transmission delay based on monitoring the entire
network rather than an individual communication. But
this argument assumes an overly limiting construction of
the prior art reference and the language of claim 35.
Under the Board’s construction, the change-over control
device of claim 35 must produce a signal automatically,
which requires monitoring quality factors, such as delay,
but there is no reason to require monitoring the band-
width of a single transfer in isolation from the network.
Additionally, the Board found that Jonas teaches that
transmission delay may be detected “using a variety of
measures known to those skilled in the art, including
topological delay time for the transmission, cost, or the
number of gateways through which the network path
traverses” as well as by “monitor[ing] the delay time . . .
by sending occasional ‘ping’ messages to the destination
router . . . and monitoring delay times of any response
packets.” J.A. 14–17 (citing ’792 patent col. 5 l. 53 to col. 6
l. 3). We find no reason to overturn the Board’s finding
that Jonas discloses the limitation of claim 35.
IN RE: TELES AG INFORMATION 21
Teles next argues a person of ordinary skill would not
have found it obvious, or even possible, to combine White
with Jonas. Teles asserts that incorporating Jonas’ “free-
standing” switches into White’s switches, the central
offices of local exchange carriers, would be “an extremely
complicated process.” Reply Br. 25. The Board cited the
examiner’s reasons for rejecting Teles’ argument: “White
is proposing providing a redesigned network [for] han-
dling Internet based call[s] . . . [and] already anticipates
redesigning the Central Office equipment to respond to
Internet type calls, thus Jonas would clearly be envi-
sioned in this network redesigned by White.” J.A. 1304.
This finding directly contradicts Teles’ assertion that
White on its own requires “no change of its switching
apparatus,” Reply Br. 26, and instead shows that White
presumes that modifications would be required.
The Board did not err in rejecting claim 35 of the ’453
patent as obvious in view of White and Jonas.
AFFIRMED