Appeals from the United States Patent and Trademark Office,
Patent Trial and Appeal Board in Nos. IPR2013-00132,
CHARLES KODISH, Fish & Richardson, P.C., Atlanta, GA, argued
for appellant. Also represented by ERIN ALPER; JOHN A.
DRAGSETH, Minneapolis, MN.
D. SMILEY, The Concept Law Group, P.A., Fort Lauderdale, FL,
argued for cross-appellant. Also represented by MARK C.
BARNES LATEEF, Office of the Solicitor, United States Patent
and Trademark Office, Alexandria, VA, argued for intervenor
Michelle K. Lee. Also represented by NATHAN K. KELLEY, SCOTT
WEIDENFELLER, WILLIAM LAMARCA.
MOORE, REYNA, and WALLACH, Circuit Judges. OPINION filed by
Circuit Judge MOORE. Opinion concurring specially in the
judgment filed by Circuit Judge REYNA.
Industries Group, Inc. appeals from the United States Patent
and Trademark Office's (" PTO" ) Patent Trial
and Appeal Board's (" Board" ) final written
decision in consolidated inter partes reviews ("
IPR" ) of claims 1-21 of U.S. Patent No. 7,806,360. Shaw
also petitions for writ of mandamus. Automated Creel Systems
(" ACS" ) cross-appeals. We affirm-in-part,
vacate-in-part, and remand. We deny Shaw's petition for
the owner of the '360 patent, which relates to "
creels" for supplying yarn and other stranded materials
to a manufacturing process. '360 patent, col. 1, ll.
14-17. An exemplary creel supply system of the patent
comprises creel magazines with a stationary frame and two
movable carts. Id. at figs. 1, 12; col. 3, ll.
18-19, 59-61. The carts carry multiple levels of spools (or
packages) of stranded material that can be routed using
guides. Id. at col. 3, ll. 62-63. Continuous runtime
can be achieved by (1) tying the material from various
packages together, and (2) replenishing empty packages on one
cart while packages on the opposite cart are used.
Id. at col. 8, ll. 32-41; col. 9, l. 64 to col. 10,
l. 16; col. 11, l. 1 to col. 12, l. 16.
1-5, 8-12, 14, 19, and 20 (" the non-interposing
claims" ) involve creel magazines with two packages of
at each level. They allow for transfer of stranded material
from one package to another across the frame. For example,
claim 5 recites:
5. A creel magazine for feeding stranded material to a
manufacturing process comprising:
a magazine having a stationary magazine frame comprising a
common guide for said stranded material;
a first and a second removable cartridge positioned adjacent
said magazine frame on respective opposite sides of said
said first removable cartridge having at least one support
arm supporting an active package of stranded material
said second removable cartridge having at least one support
arm supporting a ready package of stranded material thereon
wherein a trailing end of said stranded material carried by
said active package is connected to a leading end of said
stranded material carried by said ready package;
wherein said common guide is an annular turning surface and
said stranded material is sequentially fed to said common
guide from said active package then from said ready package.
6, 7, 13, 15-18, and 21 (" the interposing claims"
) involve creel magazines with more than two packages of
stranded material at each level. They allow for transfer of
stranded material from one package to another across the
frame (like the non-interposing claims), as well as on the
same side of the frame. For example, claim 6 recites:
6. The creel magazine of claim 5, further
comprising an additional support arm supported adjacent to
said at least one support arm for supporting an additional
ready package on said removable cartridge, to be selectively
interposed between said active package and said ready package
on said second removable cartridge to feed said stranded
February 2012, ACS sued Shaw for infringement of the '360
patent in the U.S. District Court for the Northern District
of Georgia. Automated Creel Sys., Inc. v. Shaw Indus.
Grp., Inc., No. 1:12-cv-00424-RWS (N.D.Ga. 2012). ACS
voluntarily dismissed the suit without prejudice. Within one
year of service of the complaint, see 35 U.S.C.
§ 315(b), Shaw petitioned for IPR of all twenty-one of
the '360 patent claims. Shaw proposed fifteen grounds of
rejection. Most of the grounds were directed to the
non-interposing claims. There were only three grounds
directed at the interposing claims: (1) ground 3, alleging
that all of the interposing claims would have been obvious
over German Patent Application Publication DE 3429153 A1
(" Munnekehoff" ) in view of U.S. Patent No.
5,624,082 (" Ligon" ); (2) ground 8, alleging that
all of the interposing claims would have been obvious over
German Patent DE 7413531 (" Barmag" ) in view of
Ligon; and (3) ground 11, alleging that all of the
interposing claims were anticipated by U.S. Patent No.
4,515,328 (" Payne" ) (" the Payne-based
ground" ). The Board instituted IPR on all claims except
claim 4. It did not, however, institute IPR on
all fifteen grounds argued by Shaw. With regard to the
interposing claims, the Board instituted IPR on the grounds
that these claims would have been obvious over Munnekehoff or
Barmag in view of Ligon (grounds 3 and 8, respectively).
Shaw Indus. Grp., Inc. v. Automated Creel Sys.,
No. IPR2013-00132, 2013 WL 8563792 (P.T.A.B. July 25, 2013)
(" First Institution Decision" ). The Board denied
Shaw's petition on the Payne-based ground. The Board
explained that the Payne-based ground was " denied as
redundant in light of [its] determination that there is a
reasonable likelihood that the challenged claims are
unpatentable based on the grounds of unpatentability on which
we institute an inter partes review."
Id. at *20 (citing 37 C.F.R. § 42.108). There
were no substantive determinations of the Payne-based ground
in the Board decision.
September 2013 (over one year after service of the
complaint), Shaw filed a second petition, requesting IPR of
claim 4. The Board instituted IPR based on two of the six
grounds proposed by Shaw--alleged obviousness over
Munnekehoff in view of U.S. Patent No. 4,572,458 ("
Bluhm" ) (ground 3) and alleged obviousness over Barmag
in view of Bluhm (ground 6). Shaw Indus. Grp., Inc. v.
Automated Creel Sys., Inc., No. IPR2013-00584, 2013 WL
8595536 (P.T.A.B. Dec. 31, 2013) (" Second Institution
Decision" ). It denied the other proposed grounds,
writing that it " exercise[d] [its] discretion under 37
C.F.R. § 42.108 to institute an inter partes
review based solely on the asserted grounds directed to
combinations with Bluhm and deny the remaining grounds as
redundant." [WL] at *12-13. It rejected ACS's
argument that 35 U.S.C. § 315(b) precluded it from
instituting IPR. It determined that because ACS had
voluntarily dismissed the suit without prejudice, it "
nullifie[d] the effect of the alleged service of the
complaint on Petitioner." Id. at *6.
IPRs proceeded in parallel. The Board then consolidated them
and issued one final written decision, concluding that Shaw
(1) had not shown by a preponderance of the evidence that the
interposing claims were unpatentable based on the instituted
grounds, and (2) had shown by a preponderance of the evidence
that the non-interposing claims (including claim 4) were
unpatentable based on the instituted grounds. Shaw Indus.
Group, Inc. v. Automated Creel Sys., Inc., Nos.
IPR2013-00132, IPR2013-00584, 2014 WL 3725531 (P.T.A.B. July
24, 2014) (" Final Decision" ). Shaw appeals as to
the interposing claims and ACS appeals as to claim 4. The PTO
submitted a brief (" PTO Br." ) and presented oral
argument as intervenor. See 35 U.S.C. § 143.
I.Shaw's Appeal and ...