ULTRATEC, INC., Appellant v. CAPTIONCALL, LLC, Appellee; Joseph Matal, Performing the Functions & Duties of the Under Secretary of Commerce for Intellectual Property and Director, U.S. Patent & Trademark Office, United States, Intervenors
2016-1706, 2016-1707, 2016-1710, 2016-1712, 2016-1708, 2016-1709, 2016-1715, 2016-1713, 2016-2366
United States Court of Appeals, Federal Circuit.
August 28, 2017
872 F.3d 1267
There may be a sound doctrinal basis for what Boston Hockey did. But unless the conсept of confusion completely swallows the antecedent question of the scope of a registered mark, we have yet to hear of it.
V
On some level, we understand that allowing a party to “take a free ride on another‘s registered trademark,” see B. H. Bunn Co. v. AAA Replacement Parts Co., 451 F.2d 1254, 1261 (5th Cir. 1971), simply feels wrong. Trademark rights, however, do “not confer a right to prohibit the use of [a] word or words” generally and exist “to protect the owner‘s good will against the sale of another‘s product as his.” Prestonettes, Inc. v. Coty, 264 U.S. 359, 368, 44 S.Ct. 350, 68 L.Ed. 731 (1924).
If Boston Hockey did not exist, thе district court‘s rationale might provide a reasonable way of analyzing the alleged infringement of registered service marks through their use on goods. But Boston Hockey is in the books, and it compels reversal of summary judgment in favor of Sportswear. Although there may be “error in [that] precedent,” United States v. Romeo, 122 F.3d 941, 942 n.1 (11th Cir. 1997), we do not have the authority, as a later panel, to disregard it. The case is remanded to the district court for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
PRATIK A. SHAH, Akin, Gump, Strauss, Hauer & Feld, LLP, Washington, DC, argued for appellee. Also represented by ZEWEN JULIUS CHEN, RACHEL J. ELSBY; MICHAEL P. KAHN, CAITLIN ELIZABETH OLWELL, New York, NY.
FARHEENA YASMEEN RASHEED, Office of the Solicitor, United States Patent and Trademark Office, Alexandria, VA, argued for intervenor Joseph Matal. Also represented by NATHAN K. KELLEY, THOMAS W. KRAUSE, JEREMIAH HELM, SCOTT WEIDENFELLER.
MARK R. FREEMAN, Appellate Staff, Civil Division, United States Department of Justice, Washington, DC, for intervenor United States. Also represented by SARAH CARROLL.
Before NEWMAN, LINN, and MOORE, Circuit Judges.
MOORE, Circuit Judge.
The present appeals arise from a series of inter partes reviews (“IPRs“) between Ultrаtec, Inc. (“Ultratec“) and CaptionCall, LLC (“CaptionCall“). Ultratec owns U.S. Patent Nos. 5,909,482 (“the ‘482 patent“), 6,233,314 (“the ‘314 patent“), 6,594,346 (“the ‘346 patent“), 6,603,835 (“the ‘835 patent“), 7,003,082 (“the ‘082 patent“), 7,319,740 (“the ‘740 patent“), 7,555,104 (“the ‘104 patent“), and 8,213,578 (“the ‘578 patent“). The patents disclose and claim systems for assisting deaf or hard-of-hearing users to make phone calls. CaptionCall petitioned for IPR of certain claims of Ultratec‘s patents. The Patent Trial and Appeal Board (“the Board“) held that all challenged claims were either anticipated or would have been obvious in light of a variety of prior art references. Ultratec appealed to our court. The United States Patent and Trademark Office and the Department of Justice (collectively, “the PTO“) intervened to defend the Board‘s decisions. Because the Board failed to consider material evidence and failed to explain its decisions to exclude the evidence, we vacate and remand.
BACKGROUND
Ultratec and CaptionCall are currently litigating in both district court and before the Board. Ultratec sued CaptionCall and its parent company for infringement in the Western District of Wisconsin. The case proceeded to trial, where the jury found the patents valid and infringed and awarded damages of $44.1 million. Five months after the verdict, the Board issued final written decisions holding all challenged claims of Ultratec‘s patents were either anticipated or would have been obvious. The distriсt court subsequently stayed all post-judgment proceedings pending final resolution of the IPRs.
CaptionCall retained the same invalidity expert—Mr. Benedict Occhiogrosso—in the district court litigation and the IPRs. In some instances, Mr. Occhiogrosso testified about the same issues and references in both proceedings. Ultratec sought to
Ultratec moved to supрlement the record with the inconsistent Occhiogrosso trial testimony. Because Ultratec had not first requested authorization to file the motion with the inconsistent testimony, the Board expunged the motion from the record. PTO Br. at 10 n.8. The Board‘s regulations require that a party seeking to introduce supplemental evidence more than one month after institution first request authorization to file a motion to submit the evidence.
The Board issued final written decisions, holding that every challenged claim was either anticipated or would have been obvious. These final written decisions rely heavily on the Board‘s belief that Mr. Occhiogrosso was a credible witness. See, e.g., J.A. 11,206 (“It is within our discretion to assign the appropriate weight to the testimony offered by Mr. Occhiogrosso.“). The Board cited Mr. Occhiogrosso‘s testimony over thirty times to support its findings, including at least once for each of the eight patents on appeal.3 In some instanc-
Ultratec moved for reconsideration on a variety of grounds, including that the Board failed to cоnsider Mr. Occhiogrosso‘s trial testimony and failed to explain its decision to exclude the new evidence. See J.A. 6818-20. The Board denied the motion to reconsider. It reasoned:
On November 4, 2014, after discovery and briefing were complete and a month before oral hearing, we held a conference call in which we denied Patent Owner‘s request for authorization for a late submission of additional evidence. See
37 C.F.R. § 42.20(b) (“A motion will not be entered without Board authorization“); sеe also37 C.F.R. § 42.123(b) (explaining that the late submission of supplemental information must be in the interests of justice). Patent Owner argues that the record is incomplete because we did not issue an order denying its motion. Req. Reh‘g 13-14. Patent Owner‘s [sic] mischaracterizes the events in this proceeding because no such motion was denied; we denied Patent Owner‘s request for authorization to submit evidence and, as such, no order denying its motion was necessary. To the extent Patent Owner wishes its denial of аuthorization to file late evidence to be further memorialized, this paper serves such purpose.
J.A. 6394-95 (emphasis in original).
Ultratec filed a motion to supplement the appellate record, requesting that the Board make part of the record Ultratec‘s request for authorization to file a motion to supplement the record with Mr. Occhiogrosso‘s trial testimony and the Board‘s denial of that request. J.A. 9002-03. The Board held that “the records would be adequately supplemented” by adding only two documents: Ultratec‘s motion for rehearing of the final written decision, and the Board‘s denial of that motion. J.A. 9003. Ultratec then filed a second motion to supplement the appellate record. This time, Ultratec requested the Board include Ultratec‘s October 30, 2014 email to the Board requesting a conference call to address its request for authorization to file a motion. The Board denied the motion. It explained the “emails requesting conference calls are intended to be administrative in nature; it is improper for substantive arguments to be made in emails requesting conference calls.” J.A. 9046 n.3.
Ultratec appealed to our court. The PTO intervened to defend the Board‘s decision. We have jurisdiction pursuant to
DISCUSSION
We review the Board‘s decision of how it manages its permissive rules of trial proceedings for abuse of discretion. Redline Detection, LLC v. Star Envirotech, Inc., 811 F.3d 435, 442 (Fed. Cir. 2015). The Board abuses its discretion if the decision: (1) is clearly unreasonable, arbitrary, or fanciful; (2) is basеd on an erroneous conclusion of law; (3) rests on clearly erroneous fact findings; or (4) involves a record that contains no evidence on which the Board could rationally base its decision. Id. (quoting Abrutyn v. Giovanniello, 15 F.3d 1048, 1050-51 (Fed. Cir. 1994)).
Congress gave the PTO authority to “prescribe regulations establishing procedures for the submission of supplemental information after the petition is filed.”
Good cause and interests-of-justice are closely related standards, but the interests-of-justice standard is slightly higher than good cause. While a gоod cause standard requires a party to show a specific factual reason to justify the needed discovery, under the interests-of-justice standard, the Board would look at all relevant factors. Specifically, to show good cause, a party would be required to make a particular and specific demonstration of fact. Under the interests-of-justice standard, the moving party would also be required to show that it was fully diligent in seeking discovery and that there is no undue prejudice to the non-moving party.
77 Fed. Reg. 48,719 (Aug. 14, 2012). The Board‘s Patent Trial Practice Guide explains that when a party desires to request authorization to file a motion, it should institute a conference call with the Board. 77 Fed. Reg. 48,762-63 (Aug. 14, 2012). The Guide explains that:
Typically, the Board will decide procedural issues raised in a conference call during the call itself or shortly thereafter, thereby avoiding the need for additional briefing. The Board has found that this practice simplifies a prоceeding by focusing the issues early, reducing costs and efforts associated with motions that are beyond the scope of the proceeding.
Id.
This record affords but one reasonable conclusion: Ultratec satisfied both of
The Board offers no reasoned basis why it would not be in the interest of justice to consider sworn inconsistent testimony on the identical issue. Ultratec sought to offer recent sworn testimony of the same expert addressing the same patents, references, and limitations at issue in the IPRs. A reasonable adjudicator would have wanted to review this evidence. If Mr. Occhiogrоsso gave conflicting testimony on cross-examination, this would be highly relevant to both the Board‘s analysis of the specific issues on which he gave inconsistent testimony and to the Board‘s overall view of his credibility. Mr. Occhiogrosso‘s testimony was critical to the Board‘s fact findings in this case, as the opinions’ repeated reliance on it establishes. Under such circumstances, no reasonable fact finder would refuse to consider evidence of inconsistent sworn testimony. Moreover, any such inconsistencies would likely bear on the overall credibility of the expert.
Admitting and reviewing Mr. Occhiogrosso‘s trial testimony would have placed minimal additional burden on the Board. Live testimony is rare in IPR hearings, which typically last only about an hour. See 77 Fed. Reg. at 48,762. The Board—as it did in these IPRs—makes credibility determinations based only on written declarations. Ultratec sought to introduce more written testimony. This is the exact type of evidence the Board routinely relies upon to determine credibility. There would have been very little administrative burden to reviewing more on-point testimony from the same expert on the same exact issues. Had the testimony been inconsistent, a reasonable fact finder would consider the inconsistencies. Had the testimony been consistent, the Board would not have had to spend any more time on the issue.4
A number of problems with the Board‘s procedures contributed to its errors in this case. First, the Board lacked the information necessary to make a reasoned decision. According to the Board, the movant cannot submit for consideration the evidence it seeks to admit into the record, and its briefing “must not include a discussion of the contents or types of the particular documents sought to be entered.” PTO Br. at 10 n.8. In this case, the Board denied a request to admit evidence without ever seeing the evidence it was denying; it never reviewed Mr. Occhiogrosso‘s testimony because Ultrateс was not allowed to submit that evidence with its request to file a motion to supplement the record. The Board‘s only exposure to the disputed testimony was the parties’ competing characterizations of it during the conference call for which there exists no record.
Second, the Board‘s procedures allowed it to make significant evidentiary decisions without providing an explanation or a reasoned basis for its decisions. See Motor Vehicle Mfrs. Ass‘n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443 (1983) (“[T]he agency must examinе the relevant data and articulate a satisfactory explanation for its action including a rational connection between the facts found and the choice made.” (internal quotation marks omitted)).
CaptionCall and the PTO argue Ultratec bore the responsibility to memorialize the conference call if it desired a written record. CaptionCall Br. 28; PTO Br. 25. There are, however, no statutes, regulations, statements in the Patent Trial Practice Guide, nor even notes on the PTO‘s website informing parties that they have the right to hire a stenographer to transcribe conference calls. We find no burden on the patentee to memorialize
The only reason there is any written record of the dispute is because Ultratec raised the issue in a motion for rehearing. The Board addressed the issue in its order denying rehearing, but it did not explain why it denied the request for authorization. See J.A. 6394-95. The Board noted that a conference call occurred, but it never stated what was discussed on the call. J.A. 6394. Nor did the Board address the substance of Mr. Occhiogrоsso‘s trial testimony. Id. And although the Board cited the interests of justice provision of
The Board abused its discretion when it refused to admit and consider Mr. Ocсhiogrosso‘s trial testimony and when it refused to explain its decision. Because the Board relied on Mr. Occhiogrosso‘s credibility in every IPR, we vacate every decision. See In re Van Os, 844 F.3d 1359, 1362 (Fed. Cir. 2017) (“[W]hen the Board‘s action is potentially lawful but insufficiently or inappropriately explained, we have consistently vacated and remanded for further proceedings.” (internal quotation marks omitted)). On remand, the Board shall admit and consider Mr. Occhiogrosso‘s trial testimony. If the Board finds he gave incоnsistent testimony, the Board shall consider the impact on the specific patents at issue in the trial testimony as well as on his credibility as a whole.
CONCLUSION
The Board‘s final written decisions are vacated and remanded.
VACATED AND REMANDED
COSTS
Costs to Ultratec.