Difficulties of Overcoming Substantial Evidence Review

In Roku, Inc., v. Universal Electronics, Inc.,[1] Petitioner-Appellant Roku challenged the Board’s final written decision in an inter partes review that upheld certain claims of U.S. Patent No. 9,716,853 as not obvious in view of U.S. Patent Pub. No. 2012/0249890 (“Chardon”) and other asserted references. The Federal Circuit affirmed, finding that the ’853 patent specification and expert testimony provided substantial evidence for the Board’s factual findings. Judge Newman dissented, asserting that the issues on appeal involved the ultimate question of obviousness, which required de novo review, and concluding the claims would have been obvious under such review. 

’853 Patent and Prior Art

The technology at issue relates to remote control systems allowing communications between a remote control device and target devices. For example, the ’853 patent discloses a remote control system that identifies data from a target device to generate a list of at least two communication methods. Chardon describes a system that also identifies data from a target device to generate a list. The list in Chardon, however, includes protocol-specific command codes such as infrared (IR) command codes, configured for IR transmission, and Consumer Electronic Control (CEC) command codes, configured for CEC transmission.

Board Decision

The Board’s nonobviousness holding turned on its determination that Chardon’s list of IR and CEC command codes did not teach or suggest a list of communication methods, as required by the ’853 patent claims.

The Board disagreed with Roku’s assertion that Chardon’s protocol-specific command codes indicate the command code and the communication method a transmission will use. For example, from Roku’s perspective, the IR and CEC command codes indicate the use of either IR transmissions or CEC transmissions, respectively. While neither party disputed that CEC and IR communication protocols are communication methods, Roku conceded that command codes themselves were not communication methods.  And Roku’s expert eventually conceded that command codes and communication methods are distinct.

The Board credited Universal’s expert’s testimony to find that a skilled artisan would have distinguished command codes from communication methods such that a listing of the former would not equate to a listing of the latter. The testimony cited key portions from the ’853 patent specification that made the same differentiation—command codes were not communication methods.

Federal Circuit Holding

On appeal, the Federal Circuit acknowledged Roku’s arguments, noting that Chardon’s disclosure of a list of “protocol-specific” command codes “necessarily discloses creating a listing comprised of at least two different communication methods ‘as a matter of logic.’” However, the Court also emphasized the high burden for reversal of factual issues, as this appeal presented. In light of Universal’s “persuasive[]” arguments supported by the specification and expert testimony, the Court found that Roku did not meet its burden because substantial evidence supported the Board’s decision, and the Board had discretion in its role as a factfinder to weigh the evidence itself.

Judge Newman dissented, opining that the Majority’s treatment of the appeal “as a purely factual question” overlooked analyzing “the ultimate legal question of non-obviousness” (emphasis added). Specifically, Judge Newman took issue with the Majority’s finding that “substantial evidence supports the PTAB’s finding that ‘Chardon’s listing of command codes did not teach or suggest a listing of communication methods’” (emphasis added). The dissent compared the ’853 patent and Chardon to determine if the latter suggested a listing of communication methods, finding that both (i) disclosed CEC and IR command codes lists and (ii) were directed toward providing a single remote control to use different methods to communicate with multiple target devices. While the dissent acknowledged the differences between the patent and Chardon, those differences had a minimal impact in the dissent’s analysis given that they were not recited in the claims. From this reasoning, Judge Newman concluded that the claims at issue would have been obvious because Chardon’s disclosure was “substantially identical and serve[d] the same purpose and use” as the claimed method.

Takeaway

To the extent it is reasonable to do so, Appellants may benefit from framing issues as legal issues that are reviewed under a lower de novo standard, rather than purely factual issues that only require substantial evidence for affirmance.

Endnotes

[1] Roku, Inc. v. Universal Elecs., Inc., No. 2022-1058, 2023 U.S. App. LEXIS 7656, at *1 (Fed. Cir. Mar. 31, 2023)