Federal Circuit Vacates Board's Denial of Contingent Motion to Amend

Yesterday in Veritas Technologies LLC v. Veeam Software Corporation, No. 2015-1894, the Federal Circuit vacated the Board’s denial of a contingent motion to amend in an IPR “because the Board was arbitrary and capricious in its sole ground for denying the motion.” Slip op. at 3.

Applying the broadest-reasonable-interpretation standard, the Board found the original patent claims unpatentable. The Federal Circuit affirmed the Board’s claim construction and finding of unpatentability, leading it to analyze the patent owner’s contingent motion to amend.

The patent owner sought to amend two claims to expressly incorporate its proposed claim construction into those claims. The Board denied the motion because “the patent owner did not discuss whether each newly added feature was separately known in the art.” Slip op. at 13. Instead, the patent owner had only addressed the new features in combination with other known features. Disagreeing with the Board, the Federal Circuit stated that “[w]e do not see how the Board could reasonably demand more from [patent owner] in this case.” The court saw “no reason to doubt that it is only the combination that was the ‘new feature,’ a scenario recognized in a long line of Supreme Court and Federal Circuit cases noting that novel and nonobvious inventions often are only a combination of known individual features.” Slip op. at 15.

The court also noted that, regardless of what the en banc court decides in In re Aqua Products, No. 2015-1177, which addresses the patent owner’s burden to demonstrate patentability of amended claims over the prior art of record, the Board erred here. The court remanded the case for the Board to consider patentability of the proposed substitute claims.