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United States Court of Appeals for the Federal Circuit is now open and in session.

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God save the United States and this honorable court.

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Thank you.

[00:00:15] Speaker 01:
Good morning, everyone.

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We will proceed with the argued cases.

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The first argued case for this morning is number 191668, Prairie Land Millwright against the Steel Company.

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Mr. Fischko.

[00:00:31] Speaker 04:
May it please the court, this is Craig Fischko for the appellant Prairie Land Millwright.

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To demonstrate that the board's decision is unsupported by substantial evidence, I ask that the court look to the board's final decision.

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Fischow.

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Mr. Fischow.

[00:00:46] Speaker 04:
Yes.

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This is Judge Waller.

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Just a little housekeeping question before you get going on it.

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Is independent claim one of 937 illustrative of the challenge claims?

[00:00:57] Speaker 04:
Yes, it is.

[00:00:58] Speaker 05:
OK, thanks.

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Okay.

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But I asked that the court look to the board's final written decision at Appendix Pages 22 and 23.

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At Appendix 22, the board has a schematic diagram.

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And this schematic diagram maps to the obviousness arguments in Prairie Land's petition, more specifically to the arguments at appendix 122 to 128.

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This schematic shows a paddle-bearing Dixon sweep modularized, as per the Barrow reference, into a power unit, a drive unit, and intermediate sections, and has a pivot provided between the adjacent intermediate sections, as per the Barowski reference.

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If we then look to the following page of the board's final decision at Appendix 23, it states the basis for the board's finding that Claim 1 was unobvious.

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The board states the Prairie didn't show that the intermediate portion of the Dixon sweep, which is illustrated at the top of Appendix 23,

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and which corresponds to the pivot unit in its appendix 22 schematic, the board states that we didn't show that this intermediate portion carries the paddle bearing chain.

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Now, the board didn't otherwise question whether the references taught what Prairie asserted they taught.

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The board didn't question whether there was a motivation to combine.

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It didn't question whether there was a reasonable expectation of success.

[00:02:31] Speaker 01:
You say that motivation to combine?

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Wasn't that really the reasoning behind what the board was saying about the pivot and carrying the weight?

[00:02:43] Speaker 04:
I don't believe it did.

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I think it simply said that the element wasn't present in there.

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I didn't see it questioned anywhere whether there was a motivation to combine.

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It simply said that we didn't show that the intermediate portion of Dixon, nor did we show where our pivot unit carries the paddle bearing chain.

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I didn't see it questioned any motivation.

[00:03:09] Speaker 01:
Okay, perhaps I over read there discussing the combination of references.

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Okay, proceed.

[00:03:17] Speaker 04:
Okay.

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Now, if the board's construction of carry is correct, namely the board construed carry is meaning supporting the weight of the paddles, the board's conclusion is undeniably true.

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We look at the top of Appendix 23, Dixon's paddle bearing chain doesn't have any sprocket or any other, to use the terminology of the patent, it doesn't have any other rotatable driven member supporting the weight of the paddles.

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Okay.

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But if Cary is instead given its broadest reasonable construction in light of the specification, namely if Cary means conveyor transport or contain indirect, in the sense that the paddles simply travel with and along Dixon and along the pivot unit, then we submit that Prairie clearly showed that the diagrams pivot unit

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carries the paddle bearing chain.

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If we look to the top of Appendix 23, Dixon's intermediate length carries the paddles.

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The paddles travel with and through the overall sweep and its intermediate section.

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And when this sweep is modularized as per borough and has a pivot added between intermediate sections as per Borowski, as per the Appendix 22 diagram, it still carries the paddles.

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Let me ask you this, Council.

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This is Judge O'Malley.

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The patent owner's response specifically called out the fact that they said that Prairie Land failed to discuss a pivot unit that was configured as claimed to allow for carrying of paddles and discussed what they thought was the appropriate meaning of that term.

[00:05:07] Speaker 02:
But you didn't even respond to that in your reply.

[00:05:10] Speaker 04:
Well, I'm sorry, I don't think there was a discussion of the meaning.

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I mean, when we walked into this case, we were facing infringement allegations against Prairie Land Suite, which does not support the way to the paddle, okay?

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All parties were pointing to the figure 11 in bottom into the pivot unit, which doesn't support the way to the paddles.

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The paddles simply travel through the pivot unit, okay?

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And when we saw that, we simply replied, and this is at appendix 540, we just simply noted that Dixon has its paddles moving along the sweep.

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I mean, all throughout these proceedings, neither party asserted any construction of carry, okay.

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Preland's, when we filed our petition, we only discussed the figure 11 preferred embodiment of the pivot unit.

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Sue's preliminary response didn't propose any construction for Cary.

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It, too, referenced the figure 11 pivot unit.

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The board's institution decision focused on the figure 11 preferred embodiment.

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And Sue's response did as well.

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I mean, in Sue's response at appendix 436, it

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itself asserted that the figure 11 referred embodiment exemplified the claims.

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So all throughout this Prairieland at least is walking through there thinking that the meaning of Cary is presumed.

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It's essentially it seems

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in view of the patent as a whole, that the pivot unit and more generally the sweep, when it talks, speaks of carrying the paddles, that the paddles simply travel through it and along with it.

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But what do we do with the fact that the board actually made a finding that there was waiver of this carry limitation debate?

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And that is a very discretionary finding by the board.

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You agree we would have to find that it was an abuse of discretion for the board to find waiver, isn't that right?

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Waiver of the issue of claim construction or waiver of us showing where it carried?

[00:07:31] Speaker 02:
Waiver of a request for claim construction of the carry limitation.

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But I don't think that claim construction was ever requested on that.

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Again, no parties, there was no indication that that claim limitation was in dispute.

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Throughout the proceedings, there was very little discussion of the combination unit of Figure 13 on which the board relied for its construction.

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There was no reliance on that until the final written decision.

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And in terms of addressing whether or not the carry limitation was, you know, whether or not we showed where it carried, we believe we did.

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You know, again, at appendix 540 in our reply, we noted that Dixon has paddles moving along the sweep.

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And we further noted that when it was modularized by Borough with intermediate sections, made pivotable as per Borowski, that declaimed unit resulted, pivot unit resulted from that.

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That's at Appendix 546.

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So I don't know if, I don't see the waiver.

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it was simply a case where the parties walked through the parties themselves.

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I mean, Sue itself is arguing in the district court below that the PTAP's claim construction is erroneous and is arguing for essentially the claim construction that we're arguing for now.

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It wasn't until the final written decision that the PTAP's construction came at us sideways and turned out to be supporting the weight of the paddles

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rather than merely having the paddles travel with and along the pivot unit.

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What about the portion of the written description that the PTAB relies on when it describes and supports its conclusion as to what it means, as to what its view of carry means?

[00:09:29] Speaker 04:
Well, that's certainly in the written description, but what the PTAB relied on was the combination unit, and this is more specifically recited in Claims 4, 9, and 10.

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If we regard carry as requiring support the weight of, this excludes the pivot unit of Figure 11, which is the embodiment that the parties have been focusing on.

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It's the embodiment that essentially Prairielands' accused pivot unit corresponds to or resembles that of Figure 11.

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The board's construction is certainly reasonable, but it is not the broadest reasonable construction as it excludes the figure 11 pivot unit, which is in dispute in the underlying district court proceedings.

[00:10:37] Speaker 01:
Anything else you want to tell us in your argument in chief?

[00:10:41] Speaker 04:
No, I can reserve the rest for rebuttal.

[00:10:45] Speaker 01:
Okay.

[00:10:46] Speaker 01:
All right.

[00:10:46] Speaker 01:
Thank you.

[00:10:47] Speaker 01:
And in that case, we'll hear from the other side.

[00:10:50] Speaker 01:
Mr. McEwen.

[00:10:52] Speaker 03:
Good morning, Your Honors.

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May it please the Court?

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I want to address the waiver issue first and foremost, because I believe it's dispositive.

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And at the start of this proceeding, the very first brief filed was the Patent Owner Response.

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And on page two of that brief, this would be JA

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Excuse me.

[00:11:15] Speaker 03:
Let me get to the site.

[00:11:22] Speaker 03:
Sorry.

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So this would be Appendix 437.

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So this is the very first brief filed in this proceeding.

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And towards the bottom of that page, the petitioner was put on notice that the trial grounds are completely silent on any such configuration.

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referring to the limitation, the carry limitation, or any meaningful analysis of the word carry.

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So that was in the very first brief that was filed.

[00:11:50] Speaker 01:
Did the petitioner file a brief?

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That's correct, Your Honor, and that's my point.

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The patent owner pointed this out in the record.

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The petitioner filed a brief, didn't address this point, and this was a point that was also raised before institution in the patent owner preliminary response, and that's at the appendix

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at 335, also highlighting this feature.

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And for that reason, the board held, uh, appendix at 37, that, uh, the patent owner had the opportunity to use that petitioner reply, Joseph Newman, to elaborate on this claim language, including any specific meaning petitioner associated with the terms of carry.

[00:12:30] Speaker 01:
And now, just to be clear, you're saying that this

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was raised by the petitioner and the patent owner was silenced or that it was not raised by the petitioner and the patent owner had an obligation to raise it?

[00:12:45] Speaker 03:
No, Your Honor.

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I'm pointing out that this issue was from the very first filing of the patent owner.

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So the petitioner lodged its petition.

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We filed a patent owner preliminary response.

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We raised this issue.

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The board instituted in our first brief.

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We once again highlighted this limitation and at no time

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did the petitioner argue anything special about the meaning of carry?

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And the reason that they didn't do that gets to another independent basis for affirming the board's findings here is that this is a substantial evidence case.

[00:13:19] Speaker 02:
Well, Counsel, let me, on waiver, let's stick with waiver for a second, because isn't, I mean, our case law is pretty clear that if the underlying forum chooses not to rely on waiver in connection with, for instance, a motion for reconsideration,

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and proceeds to decide the merits that there is no waiver, then we should be addressing the merits.

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And try as I might, in the board's opinion, while they discuss waiver, they never actually say, so we find it waived, and then say, but in the alternative, we're going to consider the merits.

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They simply say, well, they didn't really raise it before, and then they proceeded to delve right into the merits.

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Isn't that a problem with your reliance on waiver?

[00:14:04] Speaker 03:
Well, I would agree that the board did not use the term waiver.

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And in its rehearing decision, it faulted the patent owner for not taking earlier opportunities.

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So there is no explicit mention of the term waiver.

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But I think that's the fair import of that language.

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But in any event, it did reach the merits.

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And it reached the merits independent of this carry limitation dispute, which we pointed out in our briefing.

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And that independent basis

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is discussed at the appendix starting at the bottom of page 25 and spanning page 26.

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So, it begins at the bottom of appendix 25.

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Moreover, even if claim one used carry in a manner different from its plain and ordinary meaning, petitioner has still failed to demonstrate obviousness of claim one by preponderance of the evidence.

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And then it continues over to the appendix at 26 crediting

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The patent owner's response at pages 16 through 17, which also referenced evidence, paragraphs of the expert report that can be found at appendix 512 and 514, and it weighs this evidence.

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It weighs this evidence in comparison to what the petitioner said in its petitioner reply as based on the trial grounds, and it stated that that evidence and those arguments in comparison to the bald conclusions of the petitioner's trial ground fail.

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And that's completely independent of whether the term carry is construed or not.

[00:15:36] Speaker 02:
That aspect- What's your response?

[00:15:38] Speaker 02:
What is your response to your friend on the other side saying that the positions you're taking here are directly at odds with the positions that you're taking in that district court proceeding?

[00:15:48] Speaker 03:
I would say that we've not taken any positions here at all with respect to carry.

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And the reason we haven't done that is because we don't have to.

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It's not our burden.

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And they didn't address that aspect of the claim.

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So I would agree with.

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I mean, that's not, that wasn't really my question.

[00:16:05] Speaker 02:
So are you saying that, that he's correct that, that you argued to the district court that, that the board in this case got the construction wrong?

[00:16:16] Speaker 03:
I don't believe we've argued.

[00:16:19] Speaker 03:
Well, let me take that back.

[00:16:20] Speaker 03:
I should say I'm not litigation counsel on this case.

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So I'm not sure exactly what was argued and when, but I will say.

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the construction in the district court was different than the one that the PTAB came up with.

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And the proceedings that have happened since then, I think, have explored, you know, which one should be adopted in the district court.

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But for this particular proceeding, the meaning of carry is irrelevant when the entire configuration has been ignored.

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And I think this point is abundantly clear when you look at

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the appendix at 550, and this is an argument that the petitioner made, and they drew a picture.

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And there's a universal joint there connecting sections.

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And the question is, if the universal joint is the pivot unit and the pivot structure at the same time, the claim requires two different things, then how is there any configuration through that joint that carries paddles?

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So whether it's a path, a space, holding up the weight,

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It doesn't matter because there's just no configuration that's argued in this record.

[00:17:31] Speaker 01:
Well, they say that the universal joint operates differently from the pivot.

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Judging by my understanding of the trial grounds and what we've laid out in the brief, if you look at the petition and the conclusions again that the board cited in

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that page 26 of the appendix is that they've identified a pivot period to map to both a pivot structure and a pivot unit.

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And that was the aspect of the record that the board found in favor of the patent owner and the petitioners showing lacking.

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And that's substantial evidence.

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It's certainly reasonable to hold the petitioners to their trial grounds and when they

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identify one structure and one structure alone as meeting multiple different claim terms, that's a failure of evidence.

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And that's what the board held in this case at page 26.

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And we would submit that that independent and in addition to waiver is a basis for affirming the board's holding.

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Unless there's further questions.

[00:18:36] Speaker 01:
You're saying it's reasonable to hold under the trial grounds in the PTAB, but not reasonable even to consider?

[00:18:43] Speaker 01:
holding them to their trial grounds in the district court?

[00:18:49] Speaker 03:
Well, I'm not following the district court aspect of that.

[00:18:57] Speaker 01:
Well, that's part of the problem, is it not?

[00:19:01] Speaker 01:
How that will work out perhaps will really come to a head in the district court.

[00:19:06] Speaker 01:
But the one thing that I think the entire system is geared to avoid is having different rulings, different positions, different arguments in the district court and in the PTAB.

[00:19:23] Speaker 03:
I agree with that, Your Honor, and the interest here is not the patent owner taking inconsistent positions.

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The difference here is the board and DICTA construing a term that was unnecessary given the trial grounds.

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And now there's a dispute over this term that frankly is independent of the record here.

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And then the district court filings, which were not part of the record at the pink ball, have now been injected into this appendix.

[00:19:50] Speaker 01:
But you're supporting what the PTAB decided from, I gather you agree that this was a spontaneous decision approach in the final written decision?

[00:20:02] Speaker 03:
I don't agree that it was spontaneous given the notice that the petitioner was on it.

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And just so the record's clear, I agree with the board's basis under substantial evidence, which is based upon the structure and the claim that was never identified by the petitioner.

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I'm taking no position

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as to the meaning of Carrie in this proceeding, and we have not done that in this proceeding.

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So there is no consistency.

[00:20:27] Speaker 03:
The burden is on the petitioner to map the claims to the prior art.

[00:20:30] Speaker 03:
We don't construe claims against ourselves on terms because the petitioner didn't address them in its petition.

[00:20:38] Speaker 03:
That's the petitioner's deficiency.

[00:20:40] Speaker 01:
I agree, but now we're on appeal.

[00:20:42] Speaker 01:
Claim construction is a matter of law, and is this claim construction placed squarely at issue?

[00:20:50] Speaker 03:
I would submit, Your Honor, that it's not at issue because there was an independent basis in the Board's decision, again, spanning the appendix of 25 through 26, for saying, and this is what the Board said, it doesn't matter what the meaning of carry is.

[00:21:06] Speaker 03:
Even if the definition of carry is different from what the Board said in its decision, there is still a failure of proof here.

[00:21:14] Speaker 01:
Okay.

[00:21:14] Speaker 01:
Any more questions for Mr. McEwen?

[00:21:17] Speaker 01:
George O'Malley?

[00:21:19] Speaker 05:
No, I'm good.

[00:21:20] Speaker 05:
Okay.

[00:21:21] Speaker 01:
Good.

[00:21:21] Speaker 01:
We'll hear then from Mr. Feschko.

[00:21:24] Speaker 01:
Keep the full rebuttal time.

[00:21:26] Speaker 04:
Thank you, Your Honor.

[00:21:28] Speaker 04:
Initially, just to clarify, no.

[00:21:31] Speaker 04:
Sue Steele is telling the district court that the PTAP's claim construction is wrong and is currently arguing for a claim construction in line with what we are now arguing it should be.

[00:21:44] Speaker 04:
and which it asserted at the outset of these infringement, the infringement proceedings.

[00:21:49] Speaker 04:
If the court wishes, if it wishes to take judicial notice, I can give you a site to the exact pages of the PACER record where Sue is making these arguments.

[00:22:03] Speaker 02:
Let me ask you though, counsel, what do we do with the fact that the board said, you know, it doesn't matter because

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Whatever carry means, it doesn't affect our ultimate decision.

[00:22:15] Speaker 04:
I don't think that's the case.

[00:22:17] Speaker 04:
I mean the PTAB's own schematic shows a configuration which meets the pivot unit and that's the PTAB's own schematic at Appendix 22 maps directly to the arguments in our IPR petition.

[00:22:31] Speaker 04:
I mean that clearly shows a configuration.

[00:22:34] Speaker 04:
We did show a configuration and if we construe Kerry in the very same manner that we're asserting here and that Sue Steele itself is arguing in the district court

[00:22:45] Speaker 04:
That configuration depicted at Appendix 22 and in our petition maps directly to Claim 1.

[00:22:53] Speaker 04:
It's simply a matter of bad claim construction.

[00:22:59] Speaker 04:
The configuration is shown there in black and white.

[00:23:02] Speaker 01:
Okay, anything else you need to tell us?

[00:23:12] Speaker 04:
No, that's all, Your Honor.

[00:23:13] Speaker 01:
Any more questions for Mr. Fresco, Giorgio Mali?

[00:23:17] Speaker 05:
No.

[00:23:18] Speaker 01:
Giorgio Mali?

[00:23:19] Speaker 05:
No, thank you.

[00:23:19] Speaker 01:
Okay.

[00:23:21] Speaker 01:
Thanks to both counsels.

[00:23:22] Speaker 01:
The case is taken under submission.

[00:23:24] Speaker 05:
Thank you.

[00:23:25] Speaker 05:
Thank you.