In Dell, Inc. v. Acceleron, LLC, Case No. 2015-1513, -1514 (Fed. Cir. 2016), the Federal Circuit vacated in part the PTAB’s final written decision in IPR2013-00440, on the basis that the PTAB improperly canceled a claim based on a factual assertion first raised by the petitioner at final hearing, too late for the patent owner to meaningfully respond.

Acceleron’s U.S. Patent No. 6,948,021 relates to a computer-network appliance containing hardware modules that can be removed and replaced while the appliance remains powered on. Dell filed an IPR petition challenging several claims of the patent on anticipation and obviousness grounds.

canceling a claim based on a factual assertion first raised at final hearing did not satisfy the PTAB’s obligation to provide notice and a fair opportunity to meet the grounds of rejection

The PTAB canceled claims 3 and 20 as anticipated, and confirmed the patentability of challenged claims 14-17 and 34-36. On appeal, the Federal Circuit affirmed the decision confirming the patentability of claims, and vacated the PTAB’s decision canceling claims 3 and 20, remanding the case to the Board. With respect to claim 20, the court determined that the PTAB’s decision was based on an unreasonable claim construction. The decision on claim 3 was vacated on procedural grounds, on the basis that the PTAB improperly canceled the claim based on an argument raised for the first time at final  hearing.

Claim 3 recites a chassis comprising “caddies providing air flow from the front to the rear of the chassis.” At final hearing, the petitioner raised for a first time an argument that this limitation was disclosed in a particular figure in the allegedly anticipating reference. The PTAB determined that claim 3 was anticipated, based in part on this argument raised at final hearing.

The court determined that canceling a claim based on a factual assertion first raised at final hearing did not satisfy the PTAB’s obligation to provide notice and a fair opportunity to meet the grounds of rejection, citing  Belden Inc. v. Berk-Tek LLC, which we have previously addressed. The PTAB’s decision was also improper under the Administrative Procedure Act, 5 U.S.C. § 554(b)(3), and the PTAB’s Trial Practice Guide. [77 Fed. Reg. 48,756; 48,768], which prohibits raising new arguments or presenting new evidence at final hearing.

This case is another reminder that petitioners must satisfy their burden of proof based on arguments made in the petition, supported by evidence filed with the petition. New arguments raised in reply or at final hearing may be disregarded by the PTAB, and if these procedural requirements are not followed by the PTAB, they may be a basis for vacating a decision to cancel claims.