Federal Circuit Finds No APA Violation in PTAB Adopting Construction Similar to Construction Offered by Party After Institution

In Hamilton Beach Brands, Inc. v. f’real Foods, LLC, 2018-1274, the Federal Circuit affirmed the PTAB’s patentability determination based on a construction adopted for the first time in the final written decision, finding no violation of the APA, and declined to address the appellee’s time bar argument because it should have been raised in a cross-appeal.

Before the PTAB, neither party initially proposed a construction for the “nozzle terms” in the pre-institution briefing, and the PTAB instituted without construing these terms. f’real then proposed a construction for the “nozzle terms” in its patent owner response, Hamilton Board responded in its reply, and both parties argued about the terms at the hearing. In the final written decision, the PTAB adopted a construction for the “nozzle terms” similar to that proposed by f’real and, based on that construction, determined the claims were not unpatentable.

On appeal, the Court found no APA violation because the parties had a chance to address claim construction in post-institution briefing and during the oral hearing, and the construction adopted by the PTAB was similar to that proposed by f’real. The Court then affirmed the construction and related patentability determination.

f’real (appellee) also argued that the IPR should have been denied because Hamilton Beach did not comply with the time bar in § 315. Specifically, f’real served Hamilton Beach with an original complaint in 2014. Over one year later, f’real sought dismissal of its case when it realized that it did not own the patent because the patent was assigned to a holding company during a merger, and was never reassigned back to f’real. The district court dismissed the complaint. f’real joined the holding company and served a second complaint. Hamilton Beach then filed its IPR petition three months later.  

The Court declined to address f’real’s argument because it should have been raised as a cross appeal. The Court reasoned that f’real’s argument would require vacatur and remand, and thus was not an alternative basis for affirmance. In dictum, though, the Court noted f’real’s dismissal would not alone preclude application of the time bar.