Appeals from the United States Patent and Trademark Office,
Patent Trial and Appeal Board in No. IPR2015-00470.
Luke Geyser, Stris & Maher LLP, Los Angeles, CA, argued
for appellant. Also represented by Douglas D. Geyser; Timothy
Bechen, Bechen PLLC, Richmond, VA.
Michael T. Rosato, Wilson, Sonsini, Goodrich & Rosati,
PC, Seattle, WA, argued for cross-appellants. Also
represented by Andrew Swanson Brown; Matthew A. Argenti,
Michael Brett Levin, Palo Alto, CA; Joel Christian Boehm,
Austin, TX; Richard Torczon, Washington, DC.
E. Craven, Office of the Solicitor, United States Patent and
Trademark Office, Alexandria, VA, argued for intervenor. Also
represented by Nathan K. Kelley, Thomas W. Krause, Philip J.
Dyk, O'Malley, and Wallach, Circuit Judges.
O'MALLEY, CIRCUIT JUDGE.
Bank, E*TRADE Financial Corporation, E*TRADE Securities, LLC,
Scottrade Financial Services, Inc., Scottrade, Inc., TD
Ameritrade Holding Corp., and TD Ameritrade, Inc.
(collectively, "E*TRADE") filed a petition for
inter partes review ("IPR") of U.S. Patent No. 8,
402, 115 ("the '115 Patent"), owned by
Droplets, Inc. ("Droplets"). The Patent Trial and
Appeal Board ("the Board") instituted review and
issued a final written decision finding all claims of the
'115 Patent invalid as obvious under 35 U.S.C. §
103. E*TRADE Fin. Corp. v. Droplets, Inc., No.
IPR2015-00470, 2016 WL 3476939 (P.T.A.B. June 23, 2016)
("Board Decision"). In reaching this
conclusion, the Board found that: (1) the '115 Patent
failed to enumerate a priority claim sufficient to avoid
fully-invalidating prior art; and (2) incorporation by
reference is insufficient to satisfy a patentee's burden
of providing notice of the asserted priority date under 35
U.S.C. § 120. Droplets appealed, and the Director of the
U.S. Patent and Trademark Office intervened to defend the
Board's decision on the priority date issue. E*TRADE
filed what it characterizes as a conditional cross-appeal,
arguing that, if we disagree with the Board regarding the
priority issue, there is an alternative ground to determine
that at least some of the '115 Patent claims are invalid.
statute, a claim for benefit of the filing date of an earlier
application must include "a specific reference to [an]
earlier filed application." 35 U.S.C. § 120. We
agree with the Board that incorporation by reference cannot
satisfy this statutory requirement. Because the '115
Patent expressly claims priority only to an immediately
preceding application, and not the provisional application
before that, the Board correctly determined that an
earlier-filed reference-an international publication with the
same specification-invalidated all claims of the '115
Patent. We therefore affirm the Board's decision finding
all claims of the '115 Patent invalid as obvious. We
dismiss E*TRADE's cross-appeal as improper.
'115 Patent relates to a method and system "for
delivering interactive links for presenting applications and
second information at a client computer from remote sources
in a network-configured computer processing system."
'115 Patent at Abstract. In this appeal, the parties
dispute the effective filing date of the '115 Patent. As
depicted below, the '115 Patent was filed on January 26,
2009, and was the last of four patents filed in its lineage:
Decision, 2016 WL 3476939, at *5. The other applications
relate as follows:
• the '115 Patent was copending with the application
leading to U.S. Patent No. 7, 502, 838 ("the '838
Patent"), filed on November 24, 2003;
• the '838 Patent was copending with the application
leading to U.S. Patent No. 6, 687, 745 ("the '745
Patent"), filed on June 22, 2000;
• the '745 Patent was copending with the
earliest-filed application, Provisional Application No.
60/153, 917 ("the '917 Provisional"), filed on
September 14, 1999; and
• a Patent Cooperation Treaty ("PCT")
application ("the Franco PCT") was filed on
September 14, 2000, and published on March 22, 2001.
specification of the '115 Patent includes a priority
claim that specifically refers to the '838 Patent and
incorporates its disclosure by reference. '115 Patent,
col. 1, ll. 5-12. The '115 Patent specification also
includes a cross reference to the '917 Provisional. These
sections read as follows:
present application is a continuation of allowed U.S. patent
application Ser. No. 10/720, 728, entitled "SYSTEM AND
METHOD FOR DELIVERING REMOTELY STORED APPLICATIONS AND
INFORMATION" filed on Nov. 24, 2003 now U.S. Pat. No. 7,
502, 838, the di[s]closure of which is hereby incorporated by
reference in its entirety.
REFERENCE TO RELATED DOCUMENTS
Priority is herewith claimed under 35 U.S.C. § 119(e)
from copending Provisional Patent Application No. 60/153,
917, filed Sep. 14, 1999, entitled "METHOD AND SYSTEM
FOR DELIVERING APPLICATIONS IN CLIENT/SERVER ENVIRONMENT,
" by Louis M. Franco et al. The disclosure of this
Provisional Patent Application is incorporated by reference
herein in its entirety.
'115 Patent, col. 1, ll. 5-24.
undisputed that the '115 Patent properly claims priority
from the earlier-filed, copending '838 Patent and thus is
entitled to the benefit of the November 24, 2003 filing date
of the '838 Patent. Board Decision, 2016 WL
3476939, at *6. The '838 Patent specification identifies
the patent as a "[c]ontinuation of application No.
09/599, 382, filed on Jun. 22, 2000, now Pat. No. 6, 687,
745, " and expressly claims priority from the '917
Provisional, which was filed on September 14, 1999. '838
Patent, col. 1, ll. 5-18. As such, the parties agree that the
'838 patent is entitled to the benefit of the September
14, 1999, filing date of the '917 provisional, because
it: (1) was copending with the '745 patent; and (2)
"contains the specific references to the '745 patent
and '917 provisional required under 35 U.S.C. § 120
and 37 C.F.R. § 1.78." Board Decision,
2016 WL 3476939, at *6. The question on appeal is whether the
'115 Patent is also entitled to the '917
Provisional's priority date by virtue of the language in
the '115 Patent that incorporates the '838 Patent by
noted, the application leading to the '115 Patent was
filed on January 26, 2009. The applicant subsequently filed a
preliminary amendment that added a reference claiming
priority from the application that led to the '838
Patent. That priority claim statement listed only the 2003
application: "The present application is a continuation
of allowed U.S. Patent Application Serial No. 10/720, 728 . .
. filed on November 24, 2003, the disclosure of which is
hereby incorporated by reference in its entirety." Joint
Appendix ("J.A.") 3484. During prosecution, two
documents (a filing receipt and a bibliographic information
sheet from the PTO) initially reflected a priority claim not
only to the '838 Patent, but also to the '745 Patent
and the '917 Provisional. Prior to issuance, however, the
PTO mailed a corrected filing receipt for the application
that became the '115 Patent, dated July 19, 2012, which
listed the priority claim solely to the '838 Patent. That
document clarified the claimed priority date as follows:
"This application is a CON of 10/720, 728 11/24/2003 PAT
7502838." J.A. 3298. Although the applicant filed a
subsequent amendment to correct a typographical error in the
claims, it did not amend the priority claim. The '115
Patent issued on March 19, 2013.
2011, while the application for the '115 Patent was
pending, Droplets filed suit against E*TRADE in the United
States District Court for the Southern District of New York,
alleging infringement of the '838 and '745 patents.
After the '115 Patent issued in 2013, Droplets amended
its complaint to add that patent to the suit.
December 2014, E*TRADE filed a petition for IPR challenging
claims 1-25 of the '115 Patent. E*TRADE asserted that the
'115 Patent claims priority only to the '838 Patent
and thus is entitled to a priority date of November 24, 2003.
Based on that priority date, E*TRADE relied on the related
Franco PCT-published in March 2001-as prior art, and the
Board instituted review. In its patent owner response,
Droplets argued that the '115 Patent is entitled to the
filing date of the '917 Provisional (September 1999)
because the '115 Pa- tent's priority claim
incorporates the '838 Patent by reference. According to
Droplets, because the '838 Patent claims priority from