from the United States Patent and Trademark Office, Patent
Trial and Appeal Board in Nos. IPR2014-01457, IPR2014-01458,
Constantine L. Trela, Jr., Sidley Austin LLP, Chicago, IL,
argued for appellant. Also represented by Richard Alan
Cederoth, Douglas Lewis; Joshua John Fougere, Joseph A.
Micallef, Washington, DC.
C. O'Quinn, Kirkland & Ellis LLP, Washington, DC,
argued for appellee. Also represented by William H. Burgess;
Adam R. Alper, San Francisco, CA; Michael W. De Vries, Los
Angeles, CA; Amanda J. Hollis, Chicago, IL.
Newman, O'Malley, and Reyna, Circuit Judges.
O'MALLEY, CIRCUIT JUDGE.
Corporation ("Microsoft") appeals from decisions of
the Patent Trial and Appeal Board ("Board") in
three separate inter partes review ("IPR")
proceedings, in which the Board found that Microsoft failed
to show by a preponderance of the evidence that the
challenged claims of U.S. Patent No. 8, 144, 182
("'182 patent") were anticipated or obvious.
See Microsoft Corp. v. Biscotti Inc., No.
IPR2014-01457, 2016 Pat. App. LEXIS 7571 (P.T.A.B. Mar. 17,
2016); Microsoft Corp. v. Biscotti Inc., No.
IPR2014-01458, 2016 Pat. App. LEXIS 7572 (P.T.A.B. Mar. 17,
2016); Microsoft Corp. v. Biscotti Inc., No.
IPR2014-01459, 2016 Pat. App. LEXIS 7573 (P.T.A.B. Mar. 17,
2016). Because the Board's decisions are supported by
substantial evidence and do not rely on an erroneous claim
construction, we affirm.
'182 patent is entitled "Real Time Video
Communications System." The '182 patent discloses
"tools and techniques for providing video calling
solutions" and relates to real-time video conferencing
where two or more users communicate, over a network, in a
conference that includes video and audio of each participant.
'182 patent, Abstract.
patent explains that there are various video calling
technologies on the market, but it states that "there
have been no satisfactory video calling options for
consumers." Id. at col. 1 ll. 42-46. The
'182 patent notes three different types of video calling
systems available at the time of this patent: (1)
professional-grade systems that require complex hardware and
are expensive and difficult to use; (2) personal computer
systems, such as web cams and video chat software like Skype,
that have "far from optimal" call quality, require
the use of a personal computer, and use confusing and
error-prone software and hardware; and (3) dedicated video
phones that are expensive, require multiple phones to
communicate with others, and fail to provide adequate call
quality because they use small screens and operate over a
standard "plain old telephone system." Id.
at col. 1 l. 46-col. 2 l. 4. The '182 patent claims that
it provides a system that "solves these and other
deficiencies found in current products." Id. at
col. 2 ll. 5-6.
patented video communication system includes components such
as video communication devices, the internet, video sources,
display devices, and set-top boxes. Id. at col. 5 l.
40-col. 6 l. 13. The first video communication device
captures a video or audio stream from a video source.
Id. at col. 5 ll. 49-56. The second video
communication device similarly captures a video or audio
stream from a second video source. Id. The first and
second video communication devices can output the video or
audio stream they receive from their respective video source
to the display devices. Id. at col. 5 ll. 56-62.
video communication device also is connected to a set-top
box. Id. at col. 5 ll. 62-65. This allows the video
communication device to receive an audiovisual stream from
the set-top box and transmit it to the display device.
Id. at col. 5 l. 65-col. 6 l. 1.
video communication devices can send their video or audio
streams to one another across the internet. Id. at
col. 5 ll. 42-44; id. col. 6 ll. 1-13. For example,
the first video communication device can receive a video or
audio stream over the internet from the second video
communication device. Id. The first video
communication device then can display the video or audio
stream from the second video communication device using its
display device. Id. The second video communication
device similarly can receive a video or audio stream over the
internet from the first video communication device.
Id. The second video communication device then can
display the video or audio stream from the first video
communication device using its display device. Id.
This exchange might happen as part of a video call between
the two video communication devices.
embodiments, the video communication devices can
simultaneously display the respective audiovisual streams
from the respective set-top boxes so that the display device
shows the video or audio stream (from either video
communication device) and the audiovisual stream from the
set-top box at the same time. Id. at col. 6 ll.
14-18. In this type of situation, the video or audio stream
might be sent across the internet to another video
communication device, but the audiovisual stream from the
set-top box would not be sent over the internet to the other
video communication device. This functionality would allow a
user to participate in a video call while also watching
television at the same time. Id. at col. 6 ll. 18-
4 of the patent shows that the video communication device
includes an input video interface and an input audio
interface through which the video communication device can
receive video and audio from a set-top box. Id. at
col. 10 ll. 19-22, 48-52. The video communication device also
includes an output video interface and an output audio
interface through which the video communication device can
transmit video and audio to a display device. Id. at
col. 10 ll. 19-22, 59-67. The video communication device has
an audio capture device and a video capture device through
which it can receive audio and video; for example, these
features might include a microphone and a camera to capture
speech and footage of a video call participant. Id.
at col. 11 ll. 3-12. The video communication device also
includes a network interface that allows a connection to a
network, which can be used to communicate with a server or
another video communication device. Id. at col. 11
video communication device also includes a processor, codecs,
and a storage medium. Id. at col. 9 ll. 64- 66, col.
10 ll. 11-18. The processor generally controls the operation
of the video communication device. Id. at col. 9 ll.
64-66. The codecs provide the video communication device with
encoding and decoding functionality. Id. at col. 10
ll. 11-14. The storage medium is "encoded with
instructions executable by the processor, can provide working
memory for execution of those instructions, [and] can be used
to cache and/or buffer media streams, and/or the like."
Id. at col. 10 ll. 14-18.
'182 patent has four independent claims, but only two are
relevant to these appeals-claims 6 and 69. Independent claim
communication system, comprising:
video communication device, comprising:
[A]a video input interface to receive video input from a
[B] an audio input interface to receive audio input from the
[C]a video output interface to provide video output to a
video display device;
[D] an audio output interface to provide audio output to an
[E] a video capture device to capture video;
[F] an audio capture device to capture audio;
[G] a network interface;
[H] at least one processor; and
[I] a storage medium in communication with the at least one
processor, the storage medium having encoded thereon a set of
instructions executable by the at least one processor to
control operation of the first video communication device,
the set of instructions comprising:
[i] instructions for controlling the video capture device to
capture a captured video stream;
[ii] instructions for controlling the audio capture device to
capture a captured audio stream;
[iii] instructions for encoding the captured video stream and
the captured audio stream to produce a series of data
[iv] instructions for transmitting the series of data packets
on the network interface for reception by a second video
Id. at col. 32 l. 62-col. 33 l. 25. Claim 6 and
certain claims depending from claim 6 were at issue in the
first two IPRs.
claim 69 reads:
method of providing video calling using a first video
communication device comprising an audio capture device, a
video capture device, a network interface, an audiovisual
input interface, and an audiovisual output interface, the
[A] receiving, on the audiovisual input interface, a set-top
box audiovisual stream from a set-top box, the set-top box
audiovisual stream comprising a set-top box video stream and
a set-top box audio stream;
[B] receiving, on the network interface, a remote audiovisual
stream via a network connection with a second video
communication device, the remote audiovisual stream
comprising a remote audio stream and a remote video stream;
[C] transmitting, on the audiovisual output interface, a
consolidated output video stream comprising at least a
portion of the remote video stream and a consolidated output
audio stream comprising at least the remote audio stream;
[D] capturing a captured video stream with the video capture
[E] capturing a captured audio stream with the audio capture
[F] encoding the captured video stream and the captured audio
stream to produce a series of data packets; and
[G]transmitting the series of data packets on the network
interface for reception by the second video communication
Id. at col. 37 l. 63-col. 38 l. 23. Claim 69 and
certain claims depending from claim 69 were at issue in the
Patent No. 7, 907, 164 ("Kenoyer"), entitled
"Integrated Videoconferencing System, " was filed
on April 17, 2006, and issued on March 15, 2011. Its
invention "relates generally to conferencing and, more
specifically, to videoconferencing." Kenoyer, col. 1 ll.
22-23. The reference explains that videoconferencing allows
"two or more participants at remote locations to
communicate using both video and audio." Id. at
col. 1 ll. 25-27.
discloses a "multi-component videoconferencing
system" that "may include a camera, microphones,
speakers, and a codec possibly used in conjunction with a
computer system." Id. at col. 1 ll. 43-47.
Kenoyer explains that it is "susceptible to various
modifications and alternative forms." Id. at
col. 3 ll. 17-18. The system's video and audio
conferencing capabilities "may be implemented over
various types of networked devices." Id. at
col. 4 ll. 15-16. An embodiment of the invention implemented
over a network is provided in Figure 1:
at Fig. 1. The video conferencing system includes a network
(101) with endpoints (103A-103H), gateways (130A and 130B), a
service provider (108), a public switched telephone network
(120), conference units (105A-105D), and telephones from a
"plain old telephone system" (106A and 106B).
Id. at col. 3 l. 64-col. 4 l. 4.
endpoints (103A-103H) can be audio or videoconferencing
systems. Id. at col. 3 ll. 66-67. Kenoyer explains
that certain endpoints (103D-103H) may include audio and
video communication capabilities to create video conferencing
capability. Id. at col. 4 ll. 35-46. These endpoints
also can include or be coupled to various audio devices, such
as microphones, audio input devices, speakers, and audio
output devices. Id. at col. 4 11. 35-39. And these
endpoints can include or be coupled to various video devices,
such as monitors, projectors, televisions, video output
devices, or video input devices. Id. at col. 4 11.
44-46. The endpoints "may comprise various ports for
coupling to one or more devices (e.g., audio devices, video
devices, etc.) and/or to one or more networks."
Id. at col. 4 11. 47-49.
3 of Kenoyer shows a participant location with a
multi-component video conferencing system:
at Fig. 3. Kenoyer explains that a participant can use the
multi-component video conferencing system (300) to
communicate with other participants in a video conference.
Id. at col. 6 11. 1-4. The multi-component video
conferencing system (300) includes the following components:
a camera (303) with a camera base (363) and lens portion
(375); a display (305); a keyboard (307); a codec (309);
speakers (311a and 311b) with speaker attachments (371a and
371b); microphones (319); a network connection (351); a
computer system (355); a remote control (361); and a remote
sensor (365). Id. at col. 6 l. 4- col. 8 l. 49. A
participant can use the camera to capture video, the
microphone to capture audio while using the display to
provide video from a local or remote conference participant,
and the speakers to produce audio from remote conference
participants. Id. at col. 6 ll. 4-9.
5 of Kenoyer shows a side view of an embodiment of a codec:
at Fig. 5. Kenoyer explains that the codec can include
multiple ports on one or more sides of the codec.
Id. at col. 8 ll. 57-60. As shown in Figure 5, the
codec can have ports for a camera, a microphone, a speaker,
video input, video output, and an IP connector. Id.
at col. 8 l. 66-col. 9 l. 17.
from Figure 5, Kenoyer includes other teachings regarding the
codec. It states that "a codec (which may mean short
[sic] for 'compressor/decompressor') may comprise any
system and/or method for encoding and/or decoding (e.g.,
compressing and decompressing) data (e.g., audio and/or video
data)." Id. at col. 4 l. 67-col. 5 l. 4. In
different embodiments, the codec "may be implemented in
software, hardware, or a combination of both."
Id. at col. 5 ll. 9-10. The codec can be
incorporated into other components, such as a camera base or
a set-top box. Id. at col. 1 ll. 56-63. The codec
also can be separated out to "an independent housing
that is coupled to the set-top box, " which allows the
codec to "act as a pass-through for the regular
programming/games when a conference is not being held"
or to "display at least a portion of the
programming/games along with video for the
videoconference." Id. at col. 10 ll. 25-30.
22 of Kenoyer shows a method of video conferencing through
the multi-component video conferencing system:
at Fig. 22. Kenoyer's description of Figure 22 notes that
"in various embodiments of the methods described below,
one or more of the elements described may be performed
concurrently, in a different order than shown, or may be
omitted entirely. Other additional elements may also be
performed as desired." Id. at col. 15 ll. 2-7.
Kenoyer then writes out the steps shown in Figure 22.
Id. at col. 15 ll. 8-20.
writing out the steps shown in Figure 22, Kenoyer states,
"[e]mbodiments of a subset or all (and portions or all)
of the above may be implemented by program instructions
stored in a memory medium or carrier medium and executed by a
processor." Id. at col. 15 ll. 21-24. Kenoyer
begins the next paragraph by stating, "[i]n some
embodiments, a computer system at a respective participant
location may include a memory medium(s) on which one or more
computer programs or software components according to one
embodiment of the present invention may be stored."
Id. at col. 15 ll. 46-50. The next paragraph states,
"[f]urther modifications and alternative embodiments of
various aspects of the invention may be apparent to those
skilled in the art in view of this description."
Id. at col. 15 ll. 55-57. It also states that
"[e]lements and materials may be substituted for those
illustrated and described herein, parts and processes may be
reversed, and certain features of the invention may be
utilized independently, all as would be apparent to one
skilled in the art after having the benefit of this
description of the invention." Id. at col. 15
November 2013, Biscotti, Inc. ("Biscotti") sued
Microsoft in the U.S. District Court for the Eastern District
of Texas alleging that Microsoft infringed the '182
patent. Microsoft filed three separate IPRs in September 2014
challenging certain claims of the '182 patent on
anticipation and obviousness grounds. As relevant here, the
Board instituted review of claims 6 and 69 on anticipation
grounds, and of claims that depend from claims 6 and 69 on
anticipation and obviousness grounds. The first two IPRs,
IPR2014-01457 ("57 IPR") and IPR2014-01458
("58 IPR"), focused on independent claim 6 and
claims that depend from claim 6. The third IPR, IPR2014-01459
("59 IPR"), focused on independent claim 69 and
claims that depend from claim 69. In each IPR, the Board
ultimately found that Microsoft failed to prove by a
preponderance of the evidence that Kenoyer anticipated the
challenged claims or rendered those claims obvious.
Board began its analysis in the 57 IPR by discussing
Microsoft's assertion that Kenoyer anticipated claim 6 of
the '182 patent. 57 IPR, 2016 Pat. App. LEXIS
7571, at *14-19. In support of its argument, Microsoft
asserted that the "storage medium" limitation of
claim 6 was disclosed by the following language from
Kenoyer's specification: "[e]mbodiments of a subset
or all (and portions or all) of the above may be implemented
by program instructions stored in a memory medium or carrier
medium and executed by a processor." Id. at
*18-19 (citing Kenoyer, col. 15 ll. 21-24). Microsoft's
expert, Dr. Houh, testified that this language
"describes using computer programs to implement the
codec and other functionality described in that patent."
Id. at *19 (citing J.A. 2288 ¶ 100). Regarding
the specific "instructions" sub-limitations,
Microsoft and its expert argued that the specification, at
various places, disclosed the functions described by the
contended that the language cited by Microsoft referred only
to the description of Figure 22, which immediately preceded
the language on which Microsoft relied, rather than all of
the disclosures made throughout the Kenoyer specification.
See id. at *19-20. Biscotti and its expert, Dr.
Bovik, argued that the language could not apply to all prior
disclosures in the specification because the specification
discussed certain components, such as cooling fans and
handles to carry equipment, that could not have been
implemented in a storage medium. Id. at *21.
Biscotti argued that the more natural interpretation of the
language was that it applied only to the discussion of Figure
22. Id. at *20. Biscotti asserted that the
language's application was further supported by another
portion of the description of Figure 22, which referred to
the various "embodiments of the methods described
below." Id. (quoting Kenoyer, col. 15 ll.
3-4) (emphasis added). This language applied to the textual
description of the steps laid out in Figure 22, and Biscotti
argued that the similar language relied upon by
Microsoft-which stated "[e]mbodiments of a subset or all
(and portions or all) of the above, " Kenoyer,
col. 15 ll. 21-22 (emphasis added)-naturally applied to the
description of Figure 22 as well. 57 IPR, 2016 Pat.
App. LEXIS 7571, at *20.
Board found that Microsoft failed to prove that Kenoyer's
disclosure anticipated the "storage medium" and
"instructions" limitations of claim 6 of the
'182 patent. Id. at *24-25. The Board noted that
Microsoft's argument regarding the "storage
medium" and "instructions" limitations relied
on an interpretation of the disputed language of column 15
"referring to and tying together a number of disclosures
in various portions throughout Kenoyer regarding functions
that may be performed in various embodiments."
Id. at *24 (citing J.A. 176-79). The Board found
that "Kenoyer's program-instructions sentence does
not make sense as a disclosure blanketing all of the
preceding 34 pages, " and that the sentence "does
not refer back specifically to the various other disclosures
cited by [Microsoft]." Id. at *26. Instead, the
Board found that Biscotti's argument and evidence
regarding the meaning of the sentence was "at least as
persuasive as [Microsoft's] argument and evidence"
such that Microsoft had failed to meet its burden of proof.
Id. at *27.
Board further noted that it "makes sense that a
videoconferencing method would lend itself to implementation
with program instructions, " and it "makes sense
that the program-instructions sentence would refer
specifically to the videoconferencing method disclosed"
in the discussion of Figure 22. Id. at *27. The
Board therefore "agree[d] with [Biscotti]" that
Kenoyer's reference to "embodiments of the methods
described below" and "[e]mbodiments of a subset or
all (and portions or all) of the above" both refer to
the description of Figure 22. Id. at *27-28. The
Board accordingly found that Microsoft had not
"demonstrated by a preponderance of the evidence that
Kenoyer's program-instructions sentence and various other
cited portions disclose the claimed 'storage medium'
with its four specific 'instructions for, ' or that a
person of ordinary skill in the art would 'at once
envisage' a storage medium with the specific instructions
claimed." Id. at *28-29.
Board explained that Kenoyer's alleged disclosures of a
storage medium with instructions in accordance with the
limitations of claim 6 "are unrelated to each other in
[the] disclosure." Id. at *29. The Board
compared this to a disclosure that amounted to
"multiple, distinct teachings that the artisan might
somehow combine to achieve the claimed invention, "
which is insufficient to anticipate. Id. at *29-30
(citing Net MoneyIN Inc. v. VeriSign, Inc., 545 F.3d
1359, 1369 (Fed. Cir. 2008) (internal quotation marks
omitted)). It also found that Microsoft failed to provide
"persuasive evidence that the disclosure would be
understood by one of ordinary skill in the art to mean that
the storage medium with program instructions and the
functions performed in the various embodiments are used
together in Kenoyer." Id. at *30. The Board
therefore found that Kenoyer did not anticipate claim 6 of
the '182 patent. Id.
claims 24-26, 28, 29, 31, 37, and 41 all depended on claim 6,
the Board found that Microsoft failed to prove by a
preponderance of the evidence that Kenoyer anticipated the
claims. Id. at *32-33.
to the obviousness arguments for claims 36 and 37, the Board
found that Microsoft failed to prove obviousness over Kenoyer
and other references. Microsoft asserted that Kenoyer
discloses the "storage medium" and
"instructions" limitations, but the Board concluded
that Microsoft failed to prove that Kenoyer taught the
limitations, as discussed in the anticipation analysis.
Id. at *33-34. Microsoft did not separately address
whether Kenoyer rendered the limitations of claim 6 obvious
based on the teachings located in different parts of the
specification, so Microsoft failed to prove obviousness for
claims 36 and 37. Id. at *34.
the judges on the Board dissented from the Board's
conclusions. The dissent argued that the majority erred when
applying the law regarding § 102 to the teachings of
Kenoyer because it failed to "take into account not only
specific teachings of the reference but also the inferences
which one skilled in the art would reasonably be expected to
draw therefrom." Id. at *39 (Cherry, A.P.J.,
dissenting) (citing In re Preda, 401 F.2d 825, 826
(CCPA 1968)). "Even assuming that Kenoyer did not
disclose expressly the use of program instructions, I am
persuaded by the evidence presented that a person of ordinary
skill would recognize its description as disclosing the use
of program instructions (software) to enable the performance
of these functions." Id. at *40 (citing J.A.
8422-23 ¶ 57; In re Alappat, 33 F.3d 1526, 1583
(Fed. Cir. 1994) (en banc) (Rader, J., concurring)). The
dissent also asserted that the use of "embodiments"
throughout Kenoyer's specification suggested that the
disputed language was not as limited as Biscotti had argued.
Id. at *41-42.
majority responded to the dissent by stating that Microsoft
did not make the arguments relied upon by the dissent and
that, even were they to agree with the dissent's
reasoning, Microsoft had not met its burden of proving
anticipation. Id. at *31-32.
the Board primarily considered claim 6 in the 58 IPR, as it
did in the 57 IPR, the final written decision in the 58 IPR
is very similar to the decision in the 57 IPR. Based on the
same reasoning and underlying findings, the Board found that
Kenoyer did not anticipate claim 6 of the '182 patent.
58 IPR, 2016 Pat. App. LEXIS 7572, at *25-33. The
Board similarly found that Microsoft failed to prove Kenoyer
anticipated the dependent claims. Id. at *33. The
same administrative judge dissented from the Board's
decision in the 58 IPR, and the dissent, like the majority,
is similar to the dissent issued in the 57 IPR.
addressing obviousness, the Board again performed a similar
analysis to that performed in the final written decision for
the 57 IPR. The Board found that Microsoft failed to prove
that Kenoyer taught the "storage medium" and
"instructions" limitations of claim 6 and failed to
provide additional argument as to how Kenoyer might render
the limitation obvious when the anticipation challenge
failed, so Microsoft failed to meet its burden of providing
obviousness for these dependent claims. Id. at
Board began its analysis in the 59 IPR by discussing
Microsoft's assertion that Kenoyer anticipated claim 69
of the '182 patent. Microsoft argued that Kenoyer
disclosed receiving audio and video from the set-top box
using an audiovisual input interface. 59 IPR, 2016
Pat. App. LEXIS 7573, at *17-18. Microsoft provided two
statements to demonstrate disclosure: (1) "[t]he
codec's audio and video processing may be incorporated in
the set-top box and/or may be distributed (e.g., to other
devices through a cable coupling the devices to the set-top
box)"; and (2) "[t]he codec may also be in an
independent housing that is coupled to the set-top box 705.
The codec may act as a pass-through for the regular
programming/games when a conference is not being held"
(the "pass-through clause"). Id. The Board
found, however, that Kenoyer does not expressly disclose an
interface in either statement. Id. at *18. The Board
further found that Microsoft did not explain any basis for
finding that a person of ordinary skill in the art
("POSA") would understand the two statements as
disclosing an "interface." Id. at *18-19.