Federal Circuit: Admitted Prior Art Cannot Form Basis of Inter Partes Review Challenge

February 11, 2022

In Qualcomm Incorporated v. Apple Inc., the U.S. Court of Appeals for the Federal Circuit vacated a decision of the Patent Trial and Appeal Board (PTAB) finding that admitted prior art in Qualcomm’s patent was “prior art” that could form the basis of an inter partes review (IPR) petition. In vacating the PTAB’s decision, the court left the door open to other permissible uses of admitted prior art in an IPR.

Case Background

In 2018, Apple filed two petitions for inter partes review (IPR) at the PTAB, challenging the validity of a Qualcomm patent directed to integrated circuit devices. The Qualcomm patent includes a background section describing what was known in the art at the time of the invention, as well as a figure of an integrated circuit, which Qualcomm’s patent admitted was prior art. In its second IPR petition, Apple argued that this “applicant admitted prior art” (AAPA), when combined with a prior art patent (Majcherczak), rendered the claims of the Qualcomm patent obvious under 35 U.S.C. § 103(a).

In response to Apple’s second IPR petition, while conceding that the combination of the AAPA with Majcherczak taught each element of the challenged claims, Qualcomm argued that Apple could not rely on AAPA to challenge the validity of its patent. According to Qualcomm, AAPA is not a permissible form of “prior art” under 35 U.S.C. § 311(b), which requires that an IPR be “only on the basis of prior art consisting of patents or printed publications.” The PTAB disagreed, finding that AAPA was “prior art” under § 311(b) because it was contained in a patent (in this case, in Qualcomm’s own patent). The PTAB instituted IPR and ultimately found the challenged claims unpatentable as obvious in view of the AAPA in combination with Majcherczak. Qualcomm then appealed to the Federal Circuit.

Federal Circuit Decision

On appeal, the Federal Circuit vacated the PTAB’s decision. Relying on the text of § 311(b), and precedent interpreting this text and similar language in other statutes, the Federal Circuit found that “‘patents or printed publications’ that form the ‘basis’ of a ground for inter partes review must themselves be prior art to the challenged patent.” The court cited to earlier decisions from the U.S. Supreme Court and the Federal Circuit that “understood the ‘patents and printed publications’ referenced in § 311(b) to themselves be prior art.” The panel also relied on prior judicial interpretations of identical language in a similar statute (35 U.S.C. § 301(a)) relating to ex parte reexamination. Accordingly, the panel found that “§ 311(b) does not permit AAPA in this case to be the basis of a ground in an inter partes review, because it is not contained in a document that is a prior art patent or prior art printed publication.”

However, the court went on to clarify that while AAPA was not “prior art consisting of patents or printed publications,” “it does not follow that AAPA is categorically excluded from an inter partes review.” The court noted that both the text of the America Invents Act and its own precedent allow petitioners to rely on other evidence in inter partes review, such as affidavits and expert declarations, which are not “prior art” under § 311(b). This type of evidence could be used to show the general knowledge of a person of ordinary skill in the art at the time of the invention, or to provide evidence supporting a motivation to combine. In the same way, the court noted that AAPA can “provide a factual foundation as to what a skilled artisan would have known at the time of the invention.” In turn, AAPA could be used to furnish “a motivation to combine … or supply[] a missing claim limitation.”

Although the panel determined that the PTAB incorrectly interpreted § 311(b)’s “‘prior art consisting of patents and printed publications’ to encompass AAPA contained in the challenged patent,” it remanded to the PTAB to allow it to address whether the AAPA in Apple’s petition improperly formed the “basis” of Apple’s challenge.

While the panel did not address the issue of what exactly it means for something to form “the basis” of a challenge in an IPR, petitioners should proceed carefully when relying on AAPA from the challenged patent in a petition. In practice, petitions that challenge claims under 35 U.S.C. § 103(a) are often drafted based on a “primary” reference combined with one or more “secondary” references. At the very least, the Federal Circuit’s decision indicates that AAPA should not be used as a “primary” reference in a petition, but should instead be relied on in a way similar to expert testimony.