Parus Holdings, Inc. v. Google LLC

Case: 22-1269 Document: 48 Page: 1 Filed: 06/12/2023
United States Court of Appeals
for the Federal Circuit
______________________
PARUS HOLDINGS, INC.,
Appellant
v.
GOOGLE LLC,
Appellee
______________________
2022-1269, 2022-1270
______________________
Appeals from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in Nos. IPR2020-
00846, IPR2020-00847.
______________________
Decided: June 12, 2023
______________________
JOHN BRUCE CAMPBELL, McKool Smith, P.C., Austin,
TX, argued for appellant. Also represented by JOEL LANCE
THOLLANDER.
NATHAN R. SPEED, Wolf Greenfield & Sacks, PC, Bos-
ton, MA, argued for appellee. Also represented by
GREGORY F. CORBETT, RICHARD GIUNTA, ELISABETH H.
HUNT; GREGORY S. NIEBERG, New York, NY.
______________________
Before LOURIE, BRYSON, and REYNA, Circuit Judges.
Case: 22-1269 Document: 48 Page: 2 Filed: 06/12/2023
2 PARUS HOLDINGS, INC. v. GOOGLE LLC
LOURIE, Circuit Judge.
Parus Holdings, Inc. (“Parus”) appeals from two final
written decisions of the United States Patent and Trade-
mark Office Patent Trial and Appeal Board (“the Board”)
holding claims 1, 2, 4–7, 10, 13, and 14 of U.S. Patent
7,076,431 (“the ’431 patent”) and claims 1, 2, 4–7, 10, and
14 of U.S. Patent 9,451,084 (“the ’084 patent”) unpatenta-
ble as obvious. Parus Holdings, Inc. v. Google LLC,
IPR2020-00846, Paper 31 (P.T.A.B. Oct. 19, 2021) (“Deci-
sion”), J.A. 1–67; Parus Holdings, Inc. v. Google LLC,
IPR2020-00847, Paper 31 (P.T.A.B. Oct. 19, 2021), J.A.
68–95. 1 For the reasons provided below, we affirm.
BACKGROUND
The challenged patents are directed to an interactive
voice system that allows a user to request information from
a voice web browser. ’431 patent, Abstract. Their shared
specification discloses two preferred embodiments: a voice-
based web browser system and a voice-activated device
controller. See, e.g., ’431 patent, col. 4 ll. 30–34, col. 17 ll.
36–46. Claim 1 of the ’084 patent, reproduced below, is
representative.
1. A system for acquiring information from
one or more sources maintaining a listing of
web sites by receiving speech commands ut-
tered by users into a voice-enabled device and
1 The two final written decisions in the inter partes
reviews (“IPRs”) consolidated on appeal are largely similar
for the purposes of this appeal. The decision in Parus Hold-
ings, Inc. v. Google LLC, IPR2020-00846, Paper 31
(P.T.A.B. Oct. 19, 2021), J.A. 1–67 is cited throughout as
representative of both decisions unless specified otherwise.
Because the challenged patents share a specification, cita-
tions of the ’431 patent specification are likewise repre-
sentative, unless otherwise stated.
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PARUS HOLDINGS, INC. v. GOOGLE LLC 3
for providing information retrieved from the
web sites to the users in an audio form via the
voice-enabled device, the system comprising:
...
the computing device further configured to ac-
cess at least one of the plurality of web sites
identified by the instruction set to obtain the
information to be retrieved, wherein the com-
puting device is further configured to periodi-
cally search via the one or more networks to
identify new web sites and to add the new web
sites to the plurality of web sites, the compu-
ting device configured to access a first web
site of the plurality of web sites and, if the in-
formation to be retrieved is not found at the
first web site, the computer configured to ac-
cess the plurality of web sites remaining in an
order defined for accessing the listing of web
sites until the information to be retrieved is
found in at least one of the plurality of web
sites or until the plurality of web sites have
been accessed;
....
’084 patent, col. 24 ll. 2–59 (emphasis added). The chal-
lenged patents are continuations of and claim priority from
an application filed on February 4, 2000, which eventually
was published as U.S. Published Patent Application
2001/0047262 (“Kurganov-262”). Appellant’s Br. at 16.
Kurganov-262 and the challenged patents share a specifi-
cation. Id.
Google LLC, Samsung Electronics Co., Ltd., Samsung
Electronics America, Inc., LG Electronics Inc., and LG
Electronics USA, Inc. (collectively, “Appellees”) petitioned
for inter partes review of the ’431 and ’084 patents, assert-
ing that the challenged claims would have been obvious
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4 PARUS HOLDINGS, INC. v. GOOGLE LLC
based on a number of asserted prior art references, includ-
ing WO 01/050453 to Kovatch (“Kovatch”) and Kurganov-
262 under pre-AIA 35 U.S.C. § 103(a).
The parties disputed whether or not Kovatch qualified
as prior art to the challenged patents. Kovatch was filed
on July 12, 2001 and had an earliest possible priority date
of January 4, 2000. J.A. 1827. Parus argued that Kovatch
was not prior art because the claimed inventions had been
conceived at least by July 12, 1999, and reduced to practice
at least by December 31, 1999, prior to Kovatch’s earliest
priority date. To the extent that the Board found that the
invention had not been reduced to practice prior to that
date, Parus argued that the inventors had diligently
worked on reducing it to practice until then. In support of
its contentions, Parus submitted approximately 40 exhibits
totaling 1,300 pages, in addition to claim charts exceeding
100 pages. Appellant’s Br. at 15. However, despite sub-
mitting that material as record evidence, Parus only mini-
mally cited small portions of that material in its briefs
without meaningful explanation. See, e.g., J.A. 1333–36
(Patent Owner Response), J.A. 1435–41 (Patent Owner
Sur-Reply).
The Board declined to consider Parus’s arguments and
evidence that the challenged patents were conceived and
reduced to practice prior to Kovatch’s priority date because
it found that Parus had failed to comply with 37 C.F.R.
§ 42.6(a)(3), which prohibits incorporation by reference.
Specifically, the Board found that
Patent Owner has not presented its argu-
ments regarding prior conception and reduc-
tion to practice in its Response or Sur-reply;
rather, Patent Owner presents its arguments
in several declarations and improperly incor-
porates those arguments by reference into its
Response and Sur-reply, in violation of Rule
42.6(a)(3).
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PARUS HOLDINGS, INC. v. GOOGLE LLC 5
Decision, J.A. 16. The Board noted that Parus did not pro-
vide any “meaningful explanation in the Response,” id. at
J.A. 13, did “not cite [] any [] evidence or testimony with
specificity,” id. at 13–14, and did “not explain the basis for
[its] conclusion or cite [] any evidence to support it,” id. at
14. The Board therefore concluded that Parus had failed
to meet its burden of production and that Kovach was prior
art to the challenged patents.
Appellees also argued that Kurganov-262, the publica-
tion of the application from which the challenged patents
claim priority, is prior art because the common specifica-
tion failed to provide written description support for all the
challenged claims of the ’084 patent and claim 9 of the ’431
patent. According to Appellees, those claims were not en-
titled to the earlier effective filing date. Parus responded
that the claims were fully described in Kurganov-262 and
therefore entitled to its February 4, 2000 priority date.
The Board found that the evidence demonstrated that
the challenged claims were not entitled to the February 4,
2000 priority date and Kurganov-262 therefore qualified as
prior art. Specifically, the Board found that the claim lim-
itations requiring a computing device “configured to peri-
odically search via one or more networks to identify new
web sites and to add the new web sites to the plurality of
web sites” were not supported by the earlier application.
Decision, J.A. 58. The Board did not dispute that the com-
mon specification disclosed a device browsing server that
operated similarly to the web browsing server, and that the
device browsing server could detect and incorporate new
devices. Id. at J.A. 59–61 (citing ’431 patent at col. 17 ll.
59–62, col. 19 ll. 19–28). But the Board concluded that that
teaching was inapplicable to the web browsing server be-
cause the specification “indicates that the devices ‘appear
as “web sites”’ connected to the network,” but were not “web
sites,” and the teachings were not interchangeable. See id.(citing ’431 patent at col. 17 ll. 50–52).
Case: 22-1269 Document: 48 Page: 6 Filed: 06/12/2023
6 PARUS HOLDINGS, INC. v. GOOGLE LLC
After concluding that both Kurganov-262 and Kovatch
qualified as prior art, the Board held the challenged claims
unpatentable as obvious. Parus appealed. We have juris-
diction under 28 U.S.C. § 1295(a)(4)(A).
DISCUSSION
Parus raises two main arguments on appeal: (1) that
the Board erred in holding that Kovatch qualified as prior
art because it improperly declined to consider Parus’s ar-
guments and evidence regarding antedating, and (2) that
the Board erred in holding that the challenged claims lack
written description support and were therefore not entitled
to their earlier priority date. We address each in turn.
I
We must set aside any agency action found to be “arbi-
trary, capricious, an abuse of discretion or otherwise not in
accordance with law.” 5 U.S.C. § 706(2). We review “de
novo whether the Board’s procedures satisfy the [Adminis-
trative Procedure Act].” FanDuel, Inc. v. Interactive Games
LLC, 966 F.3d 1334, 1339 (Fed. Cir. 2020). When the
Board finds a failure to comply with its own procedures,
such decision is reviewed for an abuse of discretion, Intelli-
gent Bio-Systems, Inc. v. Illumina Cambridge Ltd., 821
F.3d 1359, 1367 (Fed. Cir. 2016), which occurs when the
Board’s decision “is clearly unreasonable, arbitrary, or fan-
ciful,” Bilstad v. Wakalopulos, 386 F.3d 1116, 1121 (Fed.
Cir. 2004).
35 U.S.C. § 316(a)(8) requires the United States Patent
and Trademark Office (“USPTO”) to promulgate rules gov-
erning patent owners’ submission of evidence. Pursuant to
that statutory mandate, the USPTO issued regulations set-
ting various restrictions and requirements on briefs sub-
mitted during IPRs. One of those regulations, 37 C.F.R.
§ 42.6(a)(3), provides that, “Arguments must not be incor-
porated by reference from one document into another doc-
ument.” Because the Board found that Parus failed to
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PARUS HOLDINGS, INC. v. GOOGLE LLC 7
comply with that regulation, it declined to consider Parus’
arguments and evidence on antedating.
On appeal, Parus does not dispute that it incorporated
arguments by reference and therefore violated 37 C.F.R.
§ 42.6(a)(3). For that reason alone, the Board’s disregard-
ing of Parus’s arguments found to be in violation of the rule
cannot be an abuse of discretion. But Parus argues that
the Board’s refusal to consider evidence of antedating is not
in accordance with the law. Specifically, Parus argues that
the Board erred in declining to consider its evidence of an-
tedating, despite its antedating argument being incorpo-
rated by reference, because such an action (a) is a violation
of the Administrative Procedure Act (“APA”), (b) improp-
erly placed a burden of persuasion on the patent owner,
and (c) conflicts with statutes and regulations governing
IPRs. These contentions boil down to two main arguments:
(1) that Parus need not have submitted briefs pointing to
and explaining the relevant record evidence, and (2) that
the Board needed to have considered all record evidence,
regardless of the manner of presentation. We disagree for
the reasons provided below.
Parus first argues that the governing IPR statutory
and regulatory provisions require specific and persuasive
attorney argument only from the petitioner, and not the pa-
tent owner. Compare 35 U.S.C. § 312 (requiring that a pe-
tition “identifies, in writing and with particularity, each
claim challenged, the grounds on which the challenge to
each claim is based, and the evidence that supports the
grounds for the challenge to each claim”), with id. § 313
(with no such requirement for preliminary responses to a
petition). Parus also points out that patent owners are not
required to file a response, citing 37 C.F.R. § 42.120(a).
It is true that patent owners have no requirement to
respond to petitions. However, here, Parus chose to take
on an affirmative burden to show that it was the first to
make its claimed inventions. Once Parus chose to submit
Case: 22-1269 Document: 48 Page: 8 Filed: 06/12/2023
8 PARUS HOLDINGS, INC. v. GOOGLE LLC
a response and assume that burden, it bore the responsi-
bilities that came with it—including submitting a response
that complied with the rules and regulations of the
USPTO. And that includes not incorporating material by
reference pursuant to 37 C.F.R. § 42.6(a)(3) and the inclu-
sion of “a detailed explanation of the significance of the ev-
idence including material facts” pursuant to 37 C.F.R.
§ 42.44. 2 See also 37 C.F.R. §§ 42.23(a), 42.120.
Parus next argues that requiring it to include argu-
ments relating to antedating in its briefs improperly placed
a burden of persuasion on the patent owner. Parus notes
that it was Appellees who bore the burden to prove that
Kovatch was prior art; Parus only bore a burden of produc-
tion, which it claims it fulfilled. Parus is correct that, in an
IPR, the petitioner bears the ultimate burden of persuasion
on invalidity, which never shifts to the patent owner. Dy-
namic Drinkware, LLC v. Nat’l Graphics, Inc., 800 F.3d
1375, 1378 (Fed. Cir. 2015). However, when a patent
owner attempts to antedate an asserted prior art reference,
the patent owner assumes a temporary burden of produc-
tion. Id. at 1378–79; see also In re Magnum Oil Tools Int’l,
Ltd., 829 F.3d 1364, 1376 (Fed. Cir. 2016) (“[A] patentee
bears the burden of establishing that its claimed invention
is entitled to an earlier priority date than an asserted prior
art reference.”).
The burden of production cannot be met simply by
throwing mountains of evidence at the Board without ex-
planation or identification of the relevant portions of that
evidence. One cannot reasonably expect the Board to sift
through hundreds of documents, thousands of pages, to
find the relevant facts. As the Seventh Circuit articulated
2 Although the Board did not explicitly cite 37 C.F.R.
§ 42.44, it faulted Parus for not including a “detailed expla-
nation of the evidence,” just as that rule requires. Decision,
J.A. 21.
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PARUS HOLDINGS, INC. v. GOOGLE LLC 9
in United States v. Dunkel, 927 F.2d 955, 956 (7th Cir.
1991), “Judges are not like pigs, hunting for truffles buried
in briefs.” We echoed that refrain in General Access Solu-
tions, Ltd. v. Sprint Spectrum L.P., 811 F. App’x 654, 657
(Fed. Cir. 2020) (unpublished), explaining that the Board
should not be forced to “play arch[a]eologist with the rec-
ord.” See also DeSilva v. DiLeonardi, 181 F.3d 865, 866–
67 (7th Cir. 1999) (“A brief must make all arguments ac-
cessible to the judges, rather than ask them to play archae-
ologist with the record.”). The burden of production cannot
be met without some combination of citing the relevant rec-
ord evidence with specificity and explaining the signifi-
cance of the produced material in briefs. Here, Parus did
neither.
As we explained in General Access, there are compel-
ling reasons why these USPTO regulations exist. In that
case, as here, the patent owner attempted to incorporate by
reference a lengthy claim chart allegedly evidencing con-
ception of the challenged claims. General Access, 811 F.
App’x at 656 n.1. We upheld the Board’s decision finding
that the conclusory assertions in the Patent Owner Re-
sponse were insufficient to meet the Patent Owner’s bur-
den of establishing prior conception. Id. at 658. In so
doing, we found that the “prohibition against incorporation
of arguments from other documents serves various policy
goals, including to ‘minimize the chance that an argument
may be overlooked’ and to ‘eliminate[] abuses that arise
from incorporation and combination.’” Id. at 657 (quoting
Rules of Practice for Trials Before the Patent Trial and Ap-
peal Board and Judicial Review of Patent Trial and Appeal
Board Decisions, 77 Fed. Reg. 48,612, 48,617 (Aug. 14,
2012)). See also DeSilva, 181 F.3d at 866–67 (Incorpora-
tion “by reference amounts to a self-help increase in the
length of the [] brief,” and “is a pointless imposition on the
court’s time.”). Further, Parus’s suggestion that patent
owners need only submit evidence—regardless how volu-
minous or argumentative—would eviscerate all page limits
Case: 22-1269 Document: 48 Page: 10 Filed: 06/12/2023
10 PARUS HOLDINGS, INC. v. GOOGLE LLC
for patent owners while maintaining restrictions on peti-
tioners. See 37 C.F.R. § 42.24.
Parus further argues that, according to our decision in
Aqua Products v. Matal, 872 F.3d 1290, 1325 (Fed. Cir.
2017) (en banc), the APA requires the Board to review “the
entirety of the record,” and that obligation cannot be obvi-
ated by rule or regulation. However, Parus’s argument is
misplaced. Aqua Products stands for the principle that the
Board must decide all issues properly before it, even if they
are contrary to its result. Nothing in Aqua Products man-
dates that the Board review evidence and issues introduced
by a party in violation of its rules or not introduced at all.
See Hunting Titan, Inc. v. DynaEnergetics Europe GmbH,
28 F.4th 1371, 1381 (Fed. Cir. 2022) (explaining that Aqua
Products does not place on the Board “an affirmative duty,
without limitation or exception, to sua sponte raise patent-
ability challenges to a proposed substitute claim,” even if
based on record evidence); Magnum Oil, 829 F.3d at 1381(“[T]he Board must base its decision on arguments that
were advanced by a party, and to which the opposing party
was given a chance to respond.”). Just as a district court
has the power to strike or not consider submissions that
exceed its page limits, are untimely filed, or otherwise do
not comply with its orders and rules, so too does the Board.
See, e.g., Belden Inc. v. Berk-Tek LLC, 805 F.3d 1064, 1081
(Fed. Cir. 2015) (explaining that “the Board’s rules and
practices establish standards bearing similarities to those
often applied in district-court litigation” and that the
Board “has broad discretion to regulate the presentation of
evidence”).
And Parus was not without recourse. Parus had almost
3,000 unused words in its Patent Owner Response. J.A.
1355. Moreover, if Parus had needed more room to explain
its position, it could have sought leave to exceed its word
count under 37 C.F.R. § 42.24(a)(2) or reallocated more of
its briefs to that argument. Parus chose not to use the av-
enues available to it.
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PARUS HOLDINGS, INC. v. GOOGLE LLC 11
Because we do not find the Board’s decision to disre-
gard Parus’s alleged evidence and argument of antedating
to be a violation of the APA or any other provision of law,
we affirm the Board’s holding that Kovatch qualifies as
prior art to the challenged patents under 35 U.S.C.
§ 103(a). Because Parus does not otherwise challenge the
Board’s holding of obviousness based on Kovatch in combi-
nation with other references, we likewise affirm the
Board’s holding that Appellees demonstrated by a prepon-
derance of the evidence that claims 1, 2, 4–7, 9, 10, 13, and
14 of the ’431 patent are unpatentable.
II
For a claim to be entitled to the “the filing date of an
earlier application under 35 U.S.C. § 120, each application
in the chain leading back to the earlier application must
comply with the written description requirement of
35 U.S.C. § 112.” Lockwood v. Am. Airlines, Inc., 107 F.3d
1565, 1571 (Fed. Cir. 1997). Each application in the chain
must therefore “reasonably convey[] to those skilled in the
art that the inventor had possession of the [later-claimed]
subject matter as of the filing date.” Ariad Pharms., Inc. v.
Eli Lilly & Co., 598 F.3d 1336, 1351 (Fed. Cir. 2010) (en
banc). “Sufficiency of written description is a question of
fact, reviewed for substantial evidence.” Gen. Hosp. Corp.
v. Sienna Biopharms., Inc., 888 F.3d 1368, 1371 (Fed. Cir.
2018).
Parus argues that (a) the Board’s determinations re-
garding written description exceeded its statutory author-
ity under 35 U.S.C. § 311(b), and (b) that the Board erred
in finding that the challenged claims did not have sufficient
written description support to entitle them to an earlier
priority date. We address each argument in turn.
A
Parus first argues that the Board’s determinations re-
garding the written description requirement of 35 U.S.C.
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12 PARUS HOLDINGS, INC. v. GOOGLE LLC
§ 112 exceeded its statutory authority under 35 U.S.C.
§ 311(b), which limits the scope of IPRs to the cancellation
of claims based “only on a ground that could be raised un-
der section 102 or 103.” Appellees respond that Parus
waived that argument by only raising it in its Preliminary
Response, and not its Response, and even if not waived, its
argument is foreclosed by our decision in Arthrex Inc. v.
Smith & Nephew, Inc., 35 F.4th 1328 (Fed. Cir. 2022). We
agree with Appellees on both points.
By raising an argument in its Preliminary Response,
but not its Response, a patent owner waives said argument.
In re NuVasive, Inc., 842 F.3d 1376, 1380 (Fed. Cir. 2016).
Even if Parus had not waived such argument, it is without
merit. As we decided in Arthrex, § 311(b) “merely dictates
the grounds on which an IPR petition may be based, not
the issues that the Board may consider to resolve those
grounds.” 35 F.4th at 1344–45. As in that case, Appellees
complied with § 311(b) by asserting invalidity grounds un-
der § 103. Because Parus asserted that Kurnagov-262 is
not prior art by claiming priority from the application from
which it stems, the Board needed to determine whether the
challenged claims satisfied the written description require-
ment. The Board therefore did not exceed its statutory au-
thority.
B
Parus argues that the challenged claims have suffi-
cient written description support and are therefore entitled
to their earlier priority date. The Board and the parties
agree that the specification discloses two preferred embod-
iments: one involving networked “web sites,” the other in-
volving networked “devices.” See, e.g., ’431 patent at col. 4
ll. 30–34, col. 17 ll. 36–46. The specification further teaches
that the device browsing embodiment “provides the same
robustness and reliability features described in the first
embodiment,” including the ability to detect “new devices”
and mark them “as being . . . new” in the system. Id., col.
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PARUS HOLDINGS, INC. v. GOOGLE LLC 13
19 ll. 10–19. Parus argues that, as demonstrated by expert
testimony, a person of ordinary skill in the art would have
understood the teachings of the second embodiment to be
applicable to the first embodiment. Appellees argue that,
as the Board found, the first embodiment relates to actual
web sites but does not add “new web sites,” whereas the
second embodiment relates to adding “new devices,” which
may “appear as ‘websites’” but are not web sites, and that
these teachings may not be combined. Decision, J.A.
58–61.
We agree with Appellees that the Board’s determina-
tion that “configured to periodically search via one or more
networks to identify new web sites and to add the new web
sites to the plurality of web sites” lacks written description
support is supported by substantial evidence. Parus’s ar-
guments amount to a request for us to reweigh the evidence
already considered by the Board, which we decline to do.
“A finding is supported by substantial evidence if a reason-
able mind might accept the evidence as adequate to sup-
port the finding.” Henny Penny Corp. v. Frymaster, LLC,
938 F.3d 1324, 1330 (Fed. Cir. 2019). That the Board gave
more credit to one expert witness than another is not
grounds for reversal. The Board’s finding was not an un-
reasonable assessment of the evidence before it, particu-
larly in light of the plain text of the specification itself.
Because we hold that (a) the Board did not exceed its
statutory authority and (b) its finding that the challenged
claims were not entitled to their earlier priority date was
supported by substantial evidence, we affirm the Board’s
holding that Kurganov-262 qualifies as prior art to the
challenged patents under 35 U.S.C. § 103(a). Because Pa-
rus does not otherwise challenge the Board’s holding of ob-
viousness based on Kurganov-262 in combination with
other references, we likewise affirm the Board’s holding
that Appellees demonstrated by a preponderance of the ev-
idence that claim 9 of the ’431 patent and claims 1, 2, 4–7,
10, and 14 of the ’084 patent are unpatentable.
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14 PARUS HOLDINGS, INC. v. GOOGLE LLC
CONCLUSION
We have considered Parus’s remaining arguments but
find them unpersuasive. For the foregoing reasons, the de-
cisions of the Board are affirmed.
AFFIRMED