In Paice LLC v. Ford Motor Company, [2017-1387, 2017-1388, 2017-1390, 2017-1457, 2017-1458, 2017-1406] (February 1, 2018), the Federal Circuit affirmed in part, reversed in part, and remanded Final Written decisions of the PTAB in six IPR’s involving U.S. Patent Nos. 7,237,634 and 8,214,097.

In particular, the Federal Circuit vacated the Board’s obviousness determinations as they relate to the ’634 patent’s “electrical” claims and remanded for the Board to determine whether those claims find written description support in the priority applications and the references incorporated therein, but otherwise affirmed the Board’s obviousness determinations as to all other claims.

Paice raised two principal arguments on appeal — first that the prior art did not disclose the claim limitations, and second that one of the references was not prior art to the claims.  The Federal Circuit made quick work of the first argument, finding that the Board correctly determined that the reference met the claim limitation.

Paice’s second argument, however, met with more success.  Paice argued that one of the references, the ’455 PCT publication, was not prior art to some of the electrical claims because they claim priority to an application (U.S. Patent Application No. 09/264,817) that predates the ’455 PCT publication.

The Federal Circuit noted that the priority date for later-added patent claims depends on when the claimed subject matter first appeared in the chain of patent applications from which the claims arose.  The Federal Circuit said that for claims to be entitled to a priority date of an earlier-filed application, the application must provide adequate written description support for the later-claimed limitations.  Paice argued that the application incorporated by reference a prior application that provided the requisite written description support.  The Board disagreed, holding that the application did not adequately incorporate the prior application, and that the claim limitations lack written description support in the prior application.

The Federal Circuit said that incorporation by reference provides a method for integrating material from various documents into a host document by citing such material in a manner that makes clear that the material is effectively part of the host document as if it were explicitly contained therein.  The Federal Circuit said that to incorporate material by reference, the host document must identify with detailed particularity what specific material it incorporates and clearly indicate where that material is found in the cited document, which the Federal Circuit found Paice did with this language:

This application discloses a number of improvements over and enhancements to the hybrid vehicles disclosed in the inventor’s U.S. Pat. No. 5,343,970 (the “’970 patent”) [Severinsky], which is incorporated herein by this reference. Where differences are not mentioned, it is to be understood that the specifics of the vehicle design shown in the ’970 patent are applicable to the vehicles shown herein as well.

The Federal Circuit rejected the Board’s interpretation of the last sentence of incorporation phrase limited the scope of the incorporation.  The Federal Circuit said this sentence had no bearing on the extent of incorporation, finding that it only refers to the applicability of certain features of the disclosure, instructing that: “The applicability of a document’s disclosed features and the incorporation of the document itself are distinct concepts, and one does not imply the other.”

This did not put an end to the saga for Paice, though.  The Federal Circuit said that to prevail on its argument that the ’455 PCT publication is not prior art to the claims, Paice must show that its ’817 application, with the incorporated material, provides sufficient written description support for those claims.  Because the Board improperly excluded the incorporated material, the Federal Circuit remanded the case for an initial Board determination.