APPLE INC. V. COREPHOTONICS, LTD. 2022-1350, 2022-1351 Decided September 11, 2023

By:  Gene M. Garner II, Partner

Apple Inc. (“Apple”) appealed two final written decisions of the United States Patent and Trademark Office (“USPTO”) Patent Trial and Appeal Board (“the Board”).  In two petitions to the Board for inter partes review, Apple had challenged the validity of various patent claims of U.S. Patent No. 10,225,479 (“the ‘479 patent”) owned by Corephotonics, LTD. (“Corephotonics”).  In both decisions, the Board had determined that Apple had not shown that the challenged patent claims of the ‘479 patent were obvious.  The CAFC found that the intrinsic evidence supports a different claim construction than the claim construction adopted by the Board in the first decision.  Moreover, the CAFC found that the Board based its second decisions on a ground not raised by any party in violation of the Administrative Procedure Act (“APA”).

On September 11, 2023, the CAFC vacated and remanded both final written decisions to the Board.

Background

Apple Inc. (“Apple”) filed two petitions with the Patent Trial and Appeal Board (“the Board”) for inter partes review of patent claims of U.S. Patent No. 10,225,479 (“the ‘479 patent”) owned by Corephotonics, LTD. (“Corephotonics”).  Apple challenged the validity of various claims of the ‘479 patent as obvious in view of multiple priority art references, including Parulski (U.S. Patent No. 7,859,588).

The ‘479 patent is directed to creating “portrait photos” using a thin dual-aperture zoom digital camera that combines images taken by a wide lens and a tele lens to create a fused still image.  The fused still image is created by incorporating an out-of-focus blurred background in a Wide image with the original Tele image.

At issue before the Board and, subsequently, the CAFC was the limitation set forth in representative claim 1 of the ‘479 patent:  wherein the camera controller is further operative to output the fused image with a point of view (POV) of the Wide camera by mapping Tele image pixels to matching pixels within the Wide image.

First Board Proceeding

At issue was the construction of the claim term requiring a “fused image with a point of view (POV) of the Wide camera”.  More particularly, Apple and Corephotonics disputed what “a point of view (POV) of the Wide camera” requires.

Both Apple and Corephotonics relied upon intrinsic evidence of the specification to support their respective arguments.  The Board described the specification’s disclosure regarding “fused image with a point of view (POV) of the Wide camera” as “not a model of clarity”.

Apple contended that, in view of the specification, “a point of view (POV) of the Wide camera” required only that the fused image retain Wide perspective or Wide position POV – that is, retain the shape of the Wide image (perspective POV) or the position of the Wide image (position POV).  In contrast, Corephotonics contended that the specification defined “point of view” such that “a point of view (POV) of the Wide camera” meant that the fused image must maintain both Wide perspective and Wide position POV.

The Board agreed with Corephotonics that, based on the specification, the fused image must maintain both Wide perspective and Wide position POV.  The Board found that Parulski did not maintain “a point of view (POV) of the Wide camera” as Parulski only disclosed Wide position POV.  The Board therefore concluded that Apple had not shown that the challenged ‘479 patent claims were unpatentable.

Second Board IPR Proceeding

Apple challenged claims 19-22 of the ‘479 patent.  Claims 19-22 included limitations relating to camera parameters, such as track length, focal length, pixel size, and others.

Apple contended that a combination of Parulski and Ogata (U.S. Patent No. 5,546,236) and other references would render claims 19-22 of the ‘479 patent obvious.  Corephotonics noted in the Background of Corephotonics’ Patent Owner Response to Apple’s arguments a typographical error in the declaration of Apple’s expert.  Corephotonics contended that Apple’s expert entered an incorrect Abbe number (a measure of a transparent material’s dispersion) for a third lens element into a software program to calculate resulting lens characteristics for Ogata’s lens were Ogata’s lens scaled down as part of a combination of references to render obvious claims 19-22 as Apple suggested in Apple’s petition.

Apple did not respond to Corephotonics’ mention of the incorrect Abbe number, and Corephotonics did not mention the incorrect Abbe number again.

The Board found that Apple had not met its burden to show the challenged claims were unpatentable based no the Abbe number identified by Corephotoncs and additional error identified for the first time by the Board in its decision.

Apple appealed to the CAFC from both Board final written decisions.

Appeal to the CAFC

Appeal of the first Board IPR Proceeding – Claim Construction of the ‘479 patent

The CAFC noted that this case presents a close issue of claim construction as both Apple and Corephotonics rely on the intrinsic evidence of the specification, making the claim construction issue a question of law that the CAFC reviews de novo.

The CAFC began its analysis with the claim language considered in context in accordance with Phillips v. AWH Corp., 415 F.3d 1303, 1314 (Fed. Cir. 2005).

The claim term at issue reads in context:  wherein the camera controller is further operative to output the fused image with a point of view (POV) of the Wide camera by mapping Tele image pixels to matching pixels within the Wide image.

The claim term does not mention position or perspective, but states only that the resulting fused image retains “a point of view (POV) of the Wide camera”.

The CAFC noted that the claim refers to “a” point of view instead of “the” point of view.

The CAFC then turned to the patent specification in accordance with Phillips.  The CAFC noted, as the Board observed, that the specification is “not a model of clarity”.  However, the CAFC asserted that specification appears to contemplate what the patent means by “point of view”.

Moreover, the CAFC also asserted that the claim term requires only that the fused image maintain “a point of view of the Wide camera”, and that “We have explained that the indefinite article ‘a’ means ‘one or more’” (Salazar v. AT&T Mobility LLC, 64 F.4^th 1311, 1315 (Fed. Cir. 2023).  The CAFC also asserted that “there is no indication in the claims, specification, or otherwise that the patentee meant to claim their invention more narrowly”.  The CAFC also refers to Convolve, Inc. v. Compaq Comput. Corp., 812 F.3d 1313, 1321 (Fed. Cir. 2016) (“[A]bsent a clear intent in the claims themselves, the specification or the prosecution history, we interpret ‘a processor’ to mean ‘one or more processors.’”).

The CAFC held that “the intrinsic evidence supports that the claim term requiring a fused image maintaining “a point of view of the Wide camera” requires only that the fused image maintain Wide perspective point of view or Wide position point of view, but does not require both” and that Apple’s proposed claim constructions is more in line with the intrinsic evidence.

Therefore, the CAFC vacated and remanded the Board’s final written decision in the first IPR for further proceedings in view of this claim construction.

Appeal of the second Board IPR Proceeding – the Administrative Procedures Act (APA)

The CAFC noted that the Board based its decision almost entirely on its determination that the declaration submitted by Apple’s expert was unreliable because of a typographical error he made regarding the lens data.  Apple challenged the Board’s written decision as violating the APA.

The CAFC noted that while the Board is entitled to set aside technical expert testimony it finds not scientifically reliable on the record, the Board violated the APA by not comporting with the notice requirements of the APA.  That is, the APA imposes limits on the Board’s authority during inter partes reviews.  Under the APA, “[p]ersons entitled to notice of an agency hearing shall be timely informed of…the matters of fact and law asserted, “ 5 U.S.C. 554(b)(3).  The CAFC further asserted that the Board “must base it decision on arguments that were advanced by a party, and to which the opposing party was given a change to respond” (In re Magnum Oil Tools Int’l, Ltd., 829 F.3d 1364, 1381 (Fed. Cir. 2016).

Significantly, the CAFC asserted that the arguments presented by Apple and by Corephotonics regarding obviousness focused entirely on questions of manufacturability and scalability and did not identify the typographical error made by Apple’s expert as dispositive.

The CAFC further asserted that the Board’s analysis was focused on the typographical error made by Apple’s expert without thoroughly assessing the critical issues out lined by the parties of whether there would have been a reasonable expectation of success in combining Parulski and Ogata considering the manufacturing and scalability concerns.

The CAFC held that the Board based is decision on a typographical error without explaining its significance, made sua sponte  findings that lacked substantial evidence, and did not resolve the issue the parties presented.

Therefore, the CAFC vacated the Board’s final written decision and remained to the Board for further proceedings that meet the APA’s requirements for notice and the opportunity to respond.

Analysis

Care should be exercised to ensure that the claim language is clear and that specification supports the claim interpretation desired by the patentee.  In this case, the patentee desired a relatively more narrow interpretation of the claims to avoid rendering the claims unpatentable for obviousness.  Therefore, a patent with a set of claims of varying scope and alternate recitations would provide the patentee with a relatively better chance of success in asserting the pat