Yita LLC v. MacNeil Ip LLC

Case: 22-1373 Document: 43 Page: 1 Filed: 06/06/2023
United States Court of Appeals
for the Federal Circuit
______________________
YITA LLC,
Appellant
v.
MACNEIL IP LLC,
Appellee
______________________
2022-1373, 2022-1374
______________________
Appeals from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in Nos. IPR2020-
01139, IPR2020-01142.
______________________
Decided: June 6, 2023
______________________
MARK P. WALTERS, Lowe Graham Jones PLLC, Seattle,
WA, argued for appellant. Also represented by JASON A.
FITZSIMMONS, RALPH WILSON POWERS, III, Sterne Kessler
Goldstein & Fox, PLLC, Washington, DC.
DAVID G. WILLE, Baker Botts LLP, Dallas, TX, argued
for appellee. Also represented by CLARKE STAVINOHA,
CHAD C. WALTERS; MICHAEL HAWES, Houston, TX.
______________________
Before TARANTO, CHEN, and STOLL, Circuit Judges.
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2 YITA LLC v. MACNEIL IP LLC
TARANTO, Circuit Judge.
MacNeil IP LLC is the assignee of two U.S. patents,
Nos. 8,382,186 and 8,833,834, that were the subject of de-
cisions by the Patent Trial and Appeal Board in inter
partes reviews (IPRs) of challenges to all claims of the pa-
tents on obviousness grounds presented in petitions filed
by Yita LLC. In IPR 2020-01139, the Board rejected Yita’s
challenge to all claims (1–7) of the ’186 patent, concluding
that—although a relevant artisan would have been moti-
vated to combine, and had a reasonable expectation of suc-
cess in combining, the teachings of the asserted prior-art
references to arrive at each challenged claim—“[MacNeil’s]
evidence of secondary considerations [was] compelling and
indicative of non-obviousness.” J.A. 81. Yita appeals that
ruling. In IPR 2020-01142, the Board, while agreeing with
Yita’s challenge to claims 13–15 of the ’834 patent (a ruling
that MacNeil does not appeal), rejected Yita’s challenge to
claims 1–12. Yita appeals that ruling. For the reasons be-
low, we reverse the Board’s judgment in the ’1139 IPR and
affirm its judgment in the ’1142 IPR.
I
A
The ’186 and ’834 patents share a specification, so for
simplicity we cite only the specification of the ’186 patent.
The subject addressed is a “vehicle floor tray . . . ther-
moformed from a polymer sheet of substantially uniform
thickness.” ’186 patent, Abstract. The specification ex-
plains that traditional vehicle “floor mats end up not being
centered on the area protected”; “pushed up so as to occlude
the gas, brake, or clutch pedals”; or “bunched up or folded
over” because “[h]uman beings have a tendency to move
their feet around” and to “push around the floor mats.” Id.
col. 1, lines 27, 30–33. “A need therefore persists,” the spec-
ification adds, “for a floor tray that will have a more exact
fit to the vehicle foot well” and “that stays in place once it
is installed.” Id. col. 2, lines 4–7.
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YITA LLC v. MACNEIL IP LLC 3
The specification describes a way to meet this need by
creating a floor tray through a process that involves taking
a digital scan of a vehicle’s foot well, id. col. 16, line 30,
through col. 17, line 3, then using a thermoform process to
give a sheet of polymer the shape of that scan, id. col. 17,
line 20, through col. 18, line 58. The resulting vehicle tray
“fits the surface” of the vehicle floor well “to an enhanced
degree of precision.” Id. col. 17, lines 22–23. In claims 1–
7 of the ’186 patent, the floor tray must “closely conform[]”
to certain walls of the vehicle foot well, id. col. 19, line 45;
id. col. 20, line 2, and in claims 1–12 of the ’834 patent,
portions of the floor tray must be “within one-eighth of an
inch” of certain walls of the vehicle foot well, ’834 patent,
col. 20, line 39. 1 Figure 1 illustrates the claimed floor tray.
The ’186 patent has seven claims, one of which (claim
1) is independent. The ’834 patent has 15 claims, four of
1 Claims 13–15 of the ’834 patent require neither
close conformance nor a maximum separation of one-eighth
of an inch. See ’834 patent, col. 22, line 56, through col. 24,
line 19.
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4 YITA LLC v. MACNEIL IP LLC
which (claims 1, 5, 9, and 13) are independent. Claim 1 of
each patent is reproduced below.
1. A vehicle floor tray thermoformed from a sheet
of thermoplastic polymeric material of substan-
tially uniform thickness, comprising:
a central panel substantially conforming to
a floor of a vehicle foot well, the central
panel of the floor tray having at least one
longitudinally disposed lateral side and at
least one transversely disposed lateral
side;
a first panel integrally formed with the cen-
tral panel of the floor tray, upwardly ex-
tending from the transversely disposed
lateral side of the central panel of the floor
tray, and closely conforming to a first foot
well wall, the first panel of the floor tray
joined to the central panel of the floor tray
by a curved transition;
a second panel integrally formed with the
central panel of the floor tray and the first
panel, upwardly extending from the longi-
tudinally disposed lateral side of the cen-
tral panel of the floor tray, and closely
conforming to a second foot well wall, the
second panel of the floor tray joined to the
central panel of the floor tray and to the
first panel of the floor tray by curved tran-
sitions;
a reservoir disposed in the central panel of
the floor tray;
a plurality of upstanding, hollow, elongate
baffles disposed in the reservoir, each of the
baffles having at least two ends remote
from each other, the central panel, the first
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YITA LLC v. MACNEIL IP LLC 5
panel, the second panel, the reservoir and
the baffles each having a thickness from a
point on the upper surface to a closest point
on the bottom surface thereof, said thick-
nesses, as a result of the tray being ther-
moformed from the sheet of thermoplastic
polymeric material of substantially uni-
form thickness, being substantially uni-
form throughout the tray;
the baffles each having a width, in any hor-
izontal direction, of more than two times its
thickness, the baffles adapted to elevate
the shoe or foot of the occupant above fluid
collected in the reservoir, and further
adapted to impede lateral movement, in-
duced by a change in vehicle speed or direc-
tion, of fluid collected in the reservoir, any
portion of the reservoir connected to a re-
mote portion of the reservoir by a path
formed around ends of the baffles.
’186 patent, col. 19, line 35, through col. 20, line 24.
1. A system including a vehicle and a floor tray for
consumer installation into a predetermined foot
well of the vehicle, the system comprising:
a vehicle foot well having a floor, a substan-
tially longitudinally disposed first foot well
wall upstanding from the floor, a substan-
tially transversely disposed second foot
well wall upstanding from the floor and
joined to the first foot well wall, a substan-
tially longitudinally disposed third foot
well wall upstanding from the floor and
joined to the second foot well wall; and
a vehicle floor tray molded from a sheet of
polymeric material of substantially
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6 YITA LLC v. MACNEIL IP LLC
uniform thickness, a central panel of the
tray substantially conforming to the floor of
the vehicle foot well, a substantially longi-
tudinally disposed first tray wall joined to
the central panel by a curved transition
and standing up from the central panel to
substantially conform to the first foot well
wall, a substantially transversely disposed
second tray wall joined to the central panel
and to the first tray wall by respective
curved transitions and standing up from
the central panel, the second tray wall sub-
stantially conforming to the second foot
well wall, a substantially longitudinally
disposed third tray wall joined to the cen-
tral panel and to the second tray wall by
respective curved transitions and standing
up from the central panel, the central panel
and first, second and third tray walls each
having an outer surface facing the vehicle
foot well and an inner surface opposed to
the outer surface, a thickness of the central
panel and of the, first, second and third
tray walls measured between the outer sur-
face and the inner surface thereof being
substantially uniform throughout the tray;
at least 90 percent of that one-third of the
outer surfaces of the first, second and third
tray walls which are closest to the respec-
tive top margins of the first, second or third
tray walls being within one-eighth of an
inch of the respective foot well walls.
’834 patent, col. 20, lines 4–40.
B
On June 30, 2020, Yita petitioned for IPRs of the ’186
and ’834 patents, challenging all claims of each patent. The
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YITA LLC v. MACNEIL IP LLC 7
Board, acting for the Director of the Patent and Trademark
Office, instituted both IPRs on January 13, 2021—IPR
2020-01139 for the ’186 patent and IPR 2020-01142 for the
’834 patent. The Board issued its final written decisions in
both IPRs on January 3, 2022.
1
In its final written decision in the ’1139 IPR, the Board
held claims 1–7 of the ’186 patent not unpatentable for ob-
viousness. The Board first determined that a relevant ar-
tisan would have been motivated to combine, and had a
reasonable expectation of success in combining, the teach-
ings of three asserted prior-art references—Rabbe, Yung,
and Gruenwald—to arrive at claims 1–7. J.A. 13–71.
Rabbe, titled “[p]rotective tray for vehicle interiors,” is a
French patent publication (No. 2,547,252), which (in the
English translation used here) discloses “floor mats with
raised edges, forming a tray and providing effective protec-
tion of the floors and side walls of vehicle interiors.” J.A.
1729. The sides of Rabbe’s floor mat “perfectly conform to
the contour of the vehicle interior.” J.A. 1730. Critically,
the Board found that “Rabbe discloses the close conform-
ance limitation in claim 1” of the ’186 patent. J.A. 39–40.
Yung, titled “mat used in cars,” is a U.S. patent application
publication (Publication No. 2002/0045029 of Application
No. 09/903,202), which describes a vehicle floor mat with a
middle plastic layer that is “flexible, light weight, and wa-
terproof Polyethylene . . . or Polyethylene–Vinyl Acetate
. . . foam.” J.A. 1748, 1753 ¶ 11. Gruenwald is a book titled
Thermoforming: A Plastics Processing Guide, which recites
methods of thermoforming. J.A. 1755.
Notwithstanding its determination about motivation to
combine and expectation of success in combining the prior-
art references to arrive at the inventions claimed in the
’186 patent, the Board rejected Yita’s obviousness chal-
lenge because, the Board concluded, MacNeil’s “evidence of
secondary considerations [was] compelling and indicative
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8 YITA LLC v. MACNEIL IP LLC
of non-obviousness.” J.A. 81. “In order . . . to accord sub-
stantial weight to secondary considerations,” the Board
recognized, “there must be a ‘legally and factually suffi-
cient connection’”—i.e., a nexus—“between the evidence
and the patented invention.” J.A. 72–73 (quoting Fox Fac-
tory, Inc. v. SRAM, LLC, 944 F.3d 1366, 1373 (Fed. Cir.
2019)). And “if the marketed product embodies the claimed
features, and is coextensive with them, then a nexus is pre-
sumed.” Brown & Williamson Tobacco Corp. v. Philip Mor-
ris Inc., 229 F.3d 1120, 1130 (Fed. Cir. 2000). The Board
found that MacNeil was entitled to a presumption of nexus,
J.A. 75, because the Board found that MacNeil’s marketed
“WeatherTech[] vehicle trays embody the claimed inven-
tion and are coextensive with the claims,” J.A. 73–74. Mac-
Neil’s successful coextensiveness contention necessarily
treated as insignificant any difference between close con-
formance of the tray with the foot well overall and close
conformance of the tray with the walls of the foot well re-
cited in claim 1.
The Board recognized that, earlier in its opinion, it had
already found that “Rabbe discloses the close conformance
limitation,” J.A. 39–40, but it found a presumption of nexus
nonetheless, J.A. 74–75. The Board stated that its earlier
finding “does not establish that close conformance was
well-known as [Yita] contends.” J.A. 75 (emphasis added).
And the Board stated, relying on WBIP, LLC v. Kohler Co.,
829 F.3d 1317 (Fed. Cir. 2016), that “[t]he Federal Circuit
instructs that ‘it is the claimed combination as a whole that
serves as a nexus for objective evidence; proof of nexus is
not limited to only when objective evidence is tied to the
supposedly “new” feature(s).’” J.A. 75 (quoting WBIP, 829
F.3d at 1330).
The Board then discussed three secondary considera-
tions—commercial success, long-felt but unsolved need,
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YITA LLC v. MACNEIL IP LLC 9
and industry praise. 2 It found that “the evidence of [each
consideration was] due to the close conforming vehicle floor
tray,” and—presumably because it already dismissed that
fact because close conformance was not “well-known”—it
concluded that the evidence on those secondary considera-
tions was “persuasive of non-obviousness.” J.A. 78 (long-
felt need); J.A. 79 (industry praise); see J.A. 77 (commercial
success) (same finding with the addition of one modifier:
“strongly persuasive of non-obviousness” (emphasis
added)). Giving “substantial weight” to the “evidence of
secondary considerations,” the Board held claims 1–7 of the
’186 patent not unpatentable. J.A. 81.
2
In its final written decision in the ’1142 IPR, the Board
held claims 13–15 of the ’834 patent unpatentable for obvi-
ousness. Although MacNeil has not appealed that ruling,
it is worth noting that, in reaching that conclusion, the
Board found unpersuasive MacNeil’s secondary-considera-
tion evidence—which Yita asserted at oral argument in
this court, without dispute from MacNeil, was identical to
the secondary-consideration evidence in the ’1139 IPR. See
Oral Arg. at 8:55–9:03 (counsel for Yita stating: “It is im-
portant to note that the . . . evidence on secondary consid-
erations was identical for . . . both IPRs.”). That evidence,
the Board found, “focuse[d] on the close conformity of the
tray to the vehicle foot well, features that are not recited in
claims 13–15.” J.A. 136; see also J.A. 137 (“[T]he long-felt
need demonstrated by [MacNeil’s] evidence relates entirely
to the closely-conforming floor tray . . . .”); J.A. 138 (“[T]he
2 The Board also discussed two other secondary con-
siderations, competitor licenses and failure of others, but
found that the competitor-licenses evidence did not weigh
in favor of nonobviousness and that the failure-of-others
argument was untimely raised. MacNeil appears not to
challenge those two findings on appeal.
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10 YITA LLC v. MACNEIL IP LLC
evidence of commercial success of the WeatherTech floor
trays leads us to find that the commercial success is due to
the close-conformity of the trays in the foot well . . . .”); J.A.
139 (“[T]he industry praise of the WeatherTech floor trays
is due to the close-conformity of the trays in the foot well
. . . .”).
With respect to claims 1–12, the Board rejected Yita’s
challenge at the prima-facie stage of analysis. Specifically,
it found that the one-eighth-inch limitation of claims 1–12
was not disclosed by any of the asserted prior-art refer-
ences. In relying on that finding to hold the prima-facie
case unpersuasive (making secondary-consideration evi-
dence immaterial for these claims), the Board declined to
consider an argument that Yita raised in a footnote in its
reply brief. J.A. 154–55, 157–58. That footnote, which ap-
pears in a section addressing what “Rabbe . . . disclose[s],”
J.A. 14784, reads: “MacNeil has not established any criti-
cality to the 1/8 inch tolerance limitations in claims 1, 5,
and 9, and it would have been obvious to optimize the tray
to fit as closely as desired,” J.A. 14786 (citing J.A. 15517
¶ 163; J.A. 3918 ¶ 24). Finding that Yita’s petition “does
not reason that it would have been obvious to modify
Rabbe’s floor tray to meet the conformance limitations,”
J.A. 154, the Board declined to consider Yita’s reply–foot-
note position because it was a “new position” and “outside
the scope of a proper reply under [37 C.F.R. §] 42.23(b),”
J.A. 155; see also J.A. 158.
Yita timely appealed from both final written decisions
on January 14, 2022, within the 63 days allowed by 37
C.F.R. § 90.3(a)(1). We have jurisdiction under 28 U.S.C.
§ 1295(a)(4)(A).
II
For a claimed invention to be patentable, the differ-
ences between it and the prior art must be such that a rel-
evant artisan at the priority date would not have found the
claimed subject matter as a whole obvious. 35 U.S.C.
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YITA LLC v. MACNEIL IP LLC 11
§ 103(a) (2011). 3 “Obviousness is a question of law based
on underlying facts, including the scope and content of the
prior art, differences between the prior art and the claims
at issue, the level of ordinary skill, and relevant evidence
of secondary considerations.” Henny Penny Corp. v. Fry-
master LLC, 938 F.3d 1324, 1331 (Fed. Cir. 2019) (citing
Graham v. John Deere Co., 383 U.S. 1, 17–18 (1966)); see
KSR International Co. v. Teleflex Inc., 550 U.S. 398, 406–
07, 427 (2007); Intercontinental Great Brands LLC v. Kel-
logg North America Co., 869 F.3d 1336, 1343–44, 1347
(Fed. Cir. 2017). Secondary considerations include
whether the claimed invention has been commercially suc-
cessful, whether it solved a long-felt but unsolved need in
the art, and whether the relevant industry praised it. See
Graham, 383 U.S. at 17–18. To be relevant, such a second-
ary consideration must have a “legally and factually suffi-
cient connection” (nexus) to the claimed invention. Fox
Factory, 944 F.3d at 1373. A nexus is presumed when a
commercial product (if relevantly successful, for example)
“is the invention disclosed and claimed in the patent.” Im-
munex Corp. v. Sandoz Inc., 964 F.3d 1049, 1067 (Fed. Cir.
2020) (quoting WBIP, 829 F.3d at 1329).
We review the Board’s legal determinations de novo
and the Board’s factual findings for substantial-evidence
support. See Henny Penny, 938 F.3d at 1330. “A finding is
supported by substantial evidence if a reasonable mind
3 The parties do not dispute that, as the Board con-
cluded, the version of § 103 that applies to the present IPRs
is the version in force before the amendments made by the
Leahy–Smith America Invents Act (AIA), Pub. L. No. 112-
29, 125 Stat. 284 (2011). See J.A. 5 n.5; J.A. 94 n.1. The
parties have not suggested that the AIA changes make a
difference here, so § 103 precedents are pertinent whether
they involved the pre-AIA or post-AIA version of the provi-
sion.
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12 YITA LLC v. MACNEIL IP LLC
might accept the evidence as adequate to support the find-
ing.” Id. (citing Consolidated Edison Co. v. National Labor
Relations Board, 305 U.S. 197, 229 (1938)).
Yita presents two arguments to us. First, Yita argues
that, in the ’1139 IPR, the Board made a result-determina-
tive legal error regarding MacNeil’s secondary-considera-
tion evidence in rejecting Yita’s challenge to claims 1–7 of
the ’186 patent. Second, Yita argues that, in the ’1142 IPR,
the Board abused its discretion by not considering Yita’s
argument raised in a footnote of its reply brief. We agree
with Yita’s first argument, but we reject its second.
A
In the ’1139 IPR, the Board rejected the obviousness
challenge to claims 1–7 of the ’186 patent—despite deter-
mining that a relevant artisan would have been motivated
with a reasonable expectation of success to combine the
teachings of Rabbe, Yung, and Gruenwald to arrive at the
claimed inventions—solely because it found MacNeil’s sec-
ondary-consideration evidence “compelling.” J.A. 81. The
Board’s finding of nexus, however, rests on legal errors,
and once those errors are corrected, the finding is not sup-
ported by substantial evidence. The Board’s judgment that
claims 1–7 of the ’186 patent are not unpatentable must
therefore be reversed.
After accepting the relevancy of MacNeil’s secondary-
consideration evidence by finding a presumption of nexus,
the Board reasoned that its finding that “Rabbe discloses
the close conformance limitation in claim 1” of the ’186 pa-
tent, J.A. 39–40, did not undermine any determination of
nexus to the claimed invention. The Board offered what
can be viewed as two reasons. But both are legally incor-
rect.
First, the Board stated that its finding regarding
Rabbe’s disclosure “does not establish that close conform-
ance was well-known as [Yita] contends.” J.A. 75
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YITA LLC v. MACNEIL IP LLC 13
(emphasis added). But our case law makes clear that “ob-
jective evidence of nonobviousness lacks a nexus if it exclu-
sively relates to a feature that was ‘known in the prior
art’”—not necessarily well-known. Rambus Inc. v. Rea, 731
F.3d 1248, 1257 (Fed. Cir. 2013) (emphasis added) (quoting
Ormco Corp. v. Align Technology, Inc., 463 F.3d 1299, 1312
(Fed. Cir. 2006)); see also Ethicon Endo-Surgery, Inc. v.
Covidien LP, 812 F.3d 1023, 1034 (Fed. Cir. 2016) (“[I]f the
feature that creates the commercial success was known in
the prior art, the success is not pertinent.” (quoting Ormco,
463 F.3d at 1312)). Where prior art teaches a feature and
a relevant artisan would have been motivated to use it in
combination with other prior-art teachings with a reason-
able expectation of success to arrive at the claimed inven-
tion—as the Board here found—a secondary consideration
related exclusively to that feature does not logically under-
mine the inference from those premises that the claimed
invention would have been obvious from the full body of
prior art just because the feature was not well known.
Second, the Board, citing WBIP, stated that “[t]he Fed-
eral Circuit instructs that ‘it is the claimed combination as
a whole that serves as a nexus for objective evidence; proof
of nexus is not limited to only when objective evidence is
tied to the supposedly “new” feature(s).’” J.A. 75 (quoting
and citing WBIP, 829 F.3d at 1330). But in WBIP we rec-
ognized that secondary-consideration evidence “may be
linked to an individual element” of the claimed invention
or “to the inventive combination of known elements” in the
prior art. 829 F.3d at 1332. It was for the latter circum-
stance, which was the circumstance present in WBIP, that
this court in WBIP made the point relied on by the Board
here. But that rationale, applicable when no single feature
(but only the combination) is responsible for the secondary-
consideration evidence, does not undermine our case law,
just discussed, denying force to a secondary consideration
that is exclusively related to a single feature that is in the
prior art.
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14 YITA LLC v. MACNEIL IP LLC
That is this case. The Board found that MacNeil’s sec-
ondary-consideration evidence “relate[d] entirely” to the
close-conformance limitation disclosed in the prior art. J.A.
137; see also J.A. 137–39 (finding that the evidence of com-
mercial success and industry praise “is due to the close-con-
formity of the trays in the foot well”). And that finding is
supported by substantial evidence. See, e.g., J.A. 1097
(MacNeil arguing in sur-reply that its witness, Weather-
Tech’s Vice President of Product Development, “testified
that customers are willing to pay a premium for Weather-
Tech’s trays primarily due to their fit in the vehicle, even
as he acknowledged that marketing could also contribute”
(citing J.A. 9051 ¶¶ 77–78; J.A. 4583, lines 11–16)); J.A.
9056 ¶¶ 83–84 (WeatherTech’s Vice President of Product
Development stating that “[c]onsumer reviews often point
out the closeness of fit as the salient characteristic of the
part, or as the reason for purchase” and that “[t]he biggest
reason for the WeatherTech FloorLiner’s commercial suc-
cess, based on the feedback received over the years, is that
they ‘fit’ the foot wells for which they were custom-de-
signed, to a degree not achieved by competitors”). 4 Thus,
4 We note in particular that the Board found Mac-
Neil’s evidence of industry praise to be “relate[d] specifi-
cally to the ‘close conformance’ [feature],” J.A. 139 (citing
J.A. 9220 ¶ 171), and that in this court MacNeil does not
challenge, but rather expressly defends, the Board’s find-
ing regarding industry praise, MacNeil’s Response Br. at
71–73. The absence of a challenge to that finding is hardly
surprising, because, while MacNeil refers to one article in
the record that mentions other features as well, id. at 72
(citing J.A. 9892–93), the Board was not required to deem
that article significant within the full record on industry
praise. Nor, in any event, would this one article be entitled
to significant weight in the overall legal weighing of the
prior-art and secondary-consideration findings and evi-
dence.
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YITA LLC v. MACNEIL IP LLC 15
the Board’s own findings, in light of the proper application
of our precedent, compel the conclusion that MacNeil’s sec-
ondary-consideration evidence is of no relevance to the ob-
viousness inquiry in this case.
The Board’s finding that the WeatherTech floor tray is
coextensive with the claimed invention does not alter the
result. The coextensiveness inquiry bears only on the pre-
sumption of nexus; it does not decide the overall nexus
question. And the presumption inquiry compares only the
claim with the commercial product. It does not involve the
connection between the commercial product and prior art,
which governs the final nexus question and here is the de-
cisive problem for MacNeil.
In sum, the secondary-consideration evidence was the
only Graham factor that the Board deemed to weigh in fa-
vor of nonobviousness. For the reasons that we have ex-
plained, the finding of secondary considerations lacks
substantial-evidence support under the proper legal stand-
ard. Because the Board determined that a relevant artisan
would have been motivated to combine the teachings of
Rabbe, Yung, and Gruenwald to arrive at claims 1–7 of the
’186 patent with a reasonable expectation of success, the
Board’s judgment that those claims are not unpatentable
for obviousness must be reversed.
B
Yita’s second argument on appeal concerns the Board’s
rejection of its challenge to claims 1–12 of the ’834 patent
in the ’1142 IPR. Yita contends that the Board abused its
discretion by declining to consider Yita’s argument about
modifying the teaching of Rabbe, an argument that the
Board declined to consider because it was presented too
late—in a footnote in Yita’s reply brief. We see no abuse of
discretion by the Board.
The Board’s rules of practice provide: “A reply may only
respond to arguments raised in the corresponding
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16 YITA LLC v. MACNEIL IP LLC
opposition, patent owner preliminary response, patent
owner response, or decision on institution.” 37 C.F.R.
§ 42.23(b). This regulation means that an “IPR petitioner
may not raise in reply ‘an entirely new rationale,’” Henny
Penny, 938 F.3d at 1330–31 (quoting Intelligent Bio-Sys-
tems, Inc. v. Illumina Cambridge Ltd., 821 F.3d 1359, 1370
(Fed. Cir. 2016)), not “raised in its petition” or “responsive
to arguments raised in the patent owner’s response brief,”
Apple Inc. v. Andrea Electronics Corp., 949 F.3d 697, 706
(Fed. Cir. 2020). The regulation “reflects . . . efficiency and
fairness interests,” Ariosa Diagnostics v. Verinata Health,
Inc., 805 F.3d 1359, 1368 (Fed. Cir. 2015), and flows from
the statutory “requirement that the initial petition identify
‘with particularity’ . . . ‘the grounds for the challenge to
each claim,’” Intelligent Bio-Systems, 821 F.3d at 1369(quoting 35 U.S.C. § 312(a)(3)).
The Board “must make [the] judgment[] about . . .
when a [r]eply contention crosses the line from the respon-
sive to the new,” Ariosa Diagnostics, 805 F.3d at 1368—a
judgment that we review for abuse of discretion, Henny
Penny, 938 F.3d at 1330 (citing Intelligent Bio-Systems, 821
F.3d at 1367). “The Board abuses its discretion if its deci-
sion: ‘(1) is clearly unreasonable, arbitrary, or fanciful; (2)
is based on an erroneous conclusion of law; (3) rests on
clearly erroneous fact finding; or (4) involves a record that
contains no evidence on which the Board could rationally
base its decision.’” Henny Penny, 938 F.3d at 1330 (quoting
Intelligent Bio-Systems, 821 F.3d at 1367).
Yita contends that the argument raised in a footnote of
its reply brief before the Board—that “it would have been
obvious to optimize the tray to fit as closely as desired,” J.A.
14786 n.4 (citing J.A. 15517 ¶ 163; J.A. 3918 ¶ 24)—was
not a new, untimely argument because “Yita raised the ar-
gument in its [p]etition,” Yita’s Opening Br. at 44. Yita di-
rects us to passages of its petition that, Yita says, anchor
its reply argument to those made in its petition. The first
such passage, which appears in a section of Yita’s petition
Case: 22-1373 Document: 43 Page: 17 Filed: 06/06/2023
YITA LLC v. MACNEIL IP LLC 17
that overarchingly argues that “Rabbe . . . discloses [limi-
tation] 1[h],” J.A. 14229 (second bracketing in original),
reads: “Rabbe discloses, or at least suggests, having at least
90 percent of the one-third of the outer surfaces of the tray
walls closest to the top margins being within one-eighth of
an inch of the respective foot well walls,” J.A. 14230. An-
other passage reads: “[A relevant artisan] would have been
able to make molds for different vehicle interiors (or differ-
ent areas of a vehicle’s interior) and adjust the mold-mak-
ing process to achieve even greater conformity with the
vehicle interior.” J.A. 14237.
We have repeatedly held that the Board acts within its
discretion when it declines under section 42.23(b) to con-
sider a new theory of unpatentability raised for the first
time in reply. See, e.g., Intelligent Bio-Systems, 821 F.3d
at 1369–70; Ariosa Diagnostics, 805 F.3d at 1367–68. Most
notably for the present case, in Intelligent Bio-Systems, we
affirmed the Board’s decision not to consider an argument
made on reply because in the original petition the chal-
lenger argued only that a reference disclosed a limitation
(“Zavgorodny teaches the desired property . . . that the az-
idomethyl group ‘can be removed under very specific and
mild conditions.’”), while in the reply the challenger argued
that a relevant artisan would have considered it obvious to
modify that reference to arrive at the limitation (“[A]n or-
dinary artisan would have considered it obvious to use
deprotecting conditions other than those described in
Zavgorodny.”). 821 F.3d at 1369 (emphasis omitted). The
present case is sufficiently similar to Intelligent Bio-Sys-
tems that we cannot say that the Board abused its discre-
tion in its ruling here.
Like the petitioner in Intelligent Bio-Systems, Yita
waited until its reply to present what in substance is an
argument that it would have been obvious to a relevant ar-
tisan to modify Rabbe to arrive at the one-eighth limita-
tion. This argument was a “meaningfully distinct
contention,” Ariosa Diagnostics, 805 F.3d at 1367, from
Case: 22-1373 Document: 43 Page: 18 Filed: 06/06/2023
18 YITA LLC v. MACNEIL IP LLC
those made in Yita’s petition, which focused (for the claim
limitation at issue) only on what Rabbe discloses. Nor was
Yita’s new theory within “the scope of a proper reply” to
any argument that MacNeil made in its patent owner re-
sponse. Intelligent Bio-Systems, 821 F.3d at 1367. Yita
points us to passages in MacNeil’s response brief before the
Board, but in the cited passages MacNeil argued only about
what Rabbe teaches—not what a relevant artisan would
have found obvious to modify. See J.A. 14499–500 (Mac-
Neil arguing in its patent owner response: “Rabbe does not
teach ‘substantially conforming’ first and second tray walls
‘being within one-eighth of an inch’ as required by [the]
[c]laims.”).
Yita, as the “master of its complaint,” could have “pre-
sent[ed] [its reply] argument in its petition[] but chose not
to.” Acceleration Bay, LLC v. Activision Blizzard Inc., 908
F.3d 765, 775 (Fed. Cir. 2018) (quoting SAS Institute, Inc.
v. Iancu, 138 S. Ct. 1348, 1355 (2018)). And the patent
owner’s response did not justify the new argument in reply.
We thus see no abuse of discretion in the Board’s decision
not to consider the new argument.
III
For the foregoing reasons, we reverse the Board’s judg-
ment in the ’1139 IPR holding claims 1–7 of the ’186 patent
not unpatentable, and we affirm the Board’s judgment in
the ’1142 IPR holding claims 1–12 of the ’834 patent not
unpatentable.
No costs.
REVERSED IN PART AND AFFIRMED IN PART