Federal Circuit drills down into details of patent decision
The US Court of Appeals for the Federal Circuit has overturned a Patent Trial and Appeal Board (PTAB) ruling, finding that the board used an “unreasonably broad” claim construction.
The court handed down its precedential decision yesterday, September 26.
Smith International, a former Fortune 500 company that merged with oilfield services business Schlumberger in 2010, owns US patent number 6,732,817.
The patent, which is called “Expandable underreamer/stabiliser”, is directed to a downhole drilling tool for oil and gas operations.
It describes an “expandable tool” with “a generally cylindrical tool body with a flowbore extending therethrough”.
The interpretation of “body” was at the centre of the appeal.
In 2012, Smith’s corporate parent sued Baker Hughes, a GE company and rival, at the US District Court for the Southern District of Texas for infringing the ‘817 patent.
Baker Hughes then requested ex parte reexamination of claims 28–37, 39–46, 49 and 50 of the patent.
The US Patent and Trademark Office (USPTO) granted the request.
During examination, Smith added and then cancelled claim 37, amended claims 28, 35, 36 and 43, while also adding and amending claims 82–84, 87 and 89–91, and adding claims 79–81, 85, 86, 88 and 93–102.
The examiner allowed new claims 82–91, 101 and 102.
But the examiner rejected a number of claims as anticipated by international publication number WO 00/31371 (Eddison), US patent number 6,059,051 (Jewkes), and European publication number EP 0 246 789 (Wardley).
Smith appealed to the PTAB—and the board affirmed all of the examiner’s rejections.
The PTAB affirmed the examiner’s interpretation of “body” as a broad term that may encompass other components.
According to the Federal Circuit, the board reasoned that the term “body” is “recited in the claims without further limiting features and that the specification neither defines the term ‘body’ nor prohibits the examiner’s broad reading of it”.
Smith then appealed to the Federal Circuit, challenging the board’s determination of the term “body”.
In response to the appeal, the USPTO claimed that the board correctly gave the term “body” its broadest reasonable interpretation and that substantial evidence supported the board’s findings.
Circuit Judge Alan Lourie, on behalf of the court, said: “We conclude that the board’s construction of ‘body’ was unreasonably broad.”
Citing Microsoft v Proxyconn, Lourie said that even when giving terms their broadest reasonable interpretation, the board cannot construe the claims “so broadly that its constructions are unreasonable under general claim construction principles”.
The Federal Circuit said that the PTAB had relied on the incorrect interpretation of the term and, in doing so, the board “affirmed the examiner’s arbitrary inclusion and exclusion of separately described components to and from the term”.
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