Daicel Corporationv.Celanese International Corporation

Patent Trial and Appeal Board

Jun 26, 2015

11788455 (P.T.A.B. Jun. 26, 2015)

Trials@uspto.gov Paper 15
Tel: 571-272-7822 Entered: June 26, 2015

UNITED STATES PATENT AND TRADEMARK OFFICE
_______________
BEFORE THE PATENT TRIAL AND APPEAL BOARD
_______________
DAICEL CORPORATION,
Petitioner,
v.
CELANESE INTERNATIONAL CORPORATION,
Patent Owner.
_______________

Case IPR2014-01514
Patent 8,076,507 B2
_______________

Before LINDA M. GAUDETTE, CHRISTOPHER L. CRUMBLEY, and
JON B. TORNQUIST, Administrative Patent Judges.

GAUDETTE, Administrative Patent Judge.

DECISION
Denying Petitioner’s Request for Rehearing
37 C.F.R. § 42.71

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On May 1, 2015, Daicel Corporation (“Petitioner”) filed a Request for
Rehearing (Paper 13, “Req. Reh’g”) of our Decision denying inter partes
review (Paper 11, “Dec.”) of claims 25–28, 31–35, 37, and 39–41 of U.S.
Patent No. 8,076,507 B2 (Ex. 1002, “the ’507 patent”). In the Decision, we
determined the information presented in the Petition (Paper 3, “Pet.”) does
not show sufficiently that there is a reasonable likelihood Petitioner would
prevail at trial with respect to at least one claim of the ’507 patent.
Accordingly, we denied the Petition and declined to institute trial.
For the reasons that follow, the Request for Rehearing is denied.
I. ANALYSIS
When considering a request for rehearing of a decision on a petition,
the Board reviews the decision for an abuse of discretion. 37 C.F.R.
§ 42.71(c). An abuse of discretion may arise if a decision is based on an
erroneous interpretation of law, if a factual finding is not supported by
substantial evidence, or if an unreasonable judgment is made in weighing
relevant factors. Star Fruits S.N.C. v. U.S., 393 F.3d 1277, 1281 (Fed. Cir.
2005); Arnold P’ship v. Dudas, 362 F.3d 1338, 1340 (Fed. Cir. 2004); In re
Gartside, 203 F.3d 1305, 1315-16 (Fed. Cir. 2000). The party requesting
rehearing has the burden of showing that the decision should be modified,
and “[t]he request must specifically identify all matters the party believes the
Board misapprehended or overlooked.” 37 C.F.R. § 42.71(d).
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With respect to both the challenges based on the ’095 patent (Grounds
1, 3 and 4) and the challenges based on Singh (Grounds 2–4),
1
Petitioner
contends our Decision was based on factual findings that are not supported
by substantial evidence and that we made unreasonable judgments in
weighing relevant factors. See generally, Req. Reh’g. With respect to the
challenges based on Singh (Grounds 2–4), Petitioner argues our Decision
was based on an erroneous claim interpretation. Id. at 12–14. Petitioner
also argues our Decision declining to institute trial on the challenges based
on Akinori (Grounds 3 and 4) was based on an erroneous determination that
Petitioner was required to provide some rationale for modifying the ’095
patent and Singh with Akinori. Id. at 9.
We address each of Petitioner’s contentions in detail below.
A. Arguments Regarding the ’095 Patent (Grounds 1, 3, and 4)
Petitioner contends our Decision declining to institute trial on
Grounds 1, 3, and 4 was improperly based on potential concerns with the
experiment (“Experiment 1”) described in the Miura Declaration (Ex. 1005),
and disregarded the fact that “the process of the ’095 patent [(Ex. 1010)],
and the teachings of the ’507 patent alone demonstrate that DME is
necessarily produced in the process of the ’095 patent and thus ends up in
the overhead stream as required by Claim 25.” Req. Reh’g. 4. Petitioner
argues further that we failed to give sufficient credit to the opinions
expressed by Mr. Miura and Mr. Cooper in their declarations (Ex. 1003 and
Ex. 1005, respectively). See id. at 2–9. Petitioner also contends we erred in

1
See Dec. 8–9 (wherein the Grounds of Unpatentability are identified).
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finding that Miura’s Experiment 1 failed to adequately replicate the ’095
patent examples (“Example” and “Example 1”) so as to demonstrate that an
amount of DME would necessarily be present in an overhead distillation
stream of the ’095 patent. Id. at 1.
Petitioner contends the ’507 patent states the inventors’ theory that
DME is necessarily present in an overhead distillation stream where methyl
acetate and methyl iodide are contacted with water prior to distillation. Req.
Reh’g 3 (citing Ex. 1002, 11:49–52 (“[I]t is believed that this water reacts
with methyl acetate and/or methyl iodide in [distillation] column 22 to form
methanol, which is then dehydrated in the presence of an acid catalyst (such
as HI) to form DME.”)). Petitioner directs us to its Petition (Req. Reh’g 2–
3), wherein it argued: “Much like the purported ‘discovery’ in the ’507
Patent, the distillation in the ’095 Patent is conducted in the presence of
water. The presence of DME as a result of this water is not mentioned, but
would be expected if the theory of the ’507 Patent holds true, and, in fact,
Mr. Cooper concludes it is conclusively shown by the Miura Decl,” Pet. 27
(citing Ex. 1005 ¶ 63).
The problem with Petitioner’s argument is that the quotation at
column 11, lines 49–52 of the ’507 patent is taken out of context. “[T]his
water” (Ex. 1002, 11:49–50), i.e., the water that reacts with methyl acetate
and/or methyl iodide to form DME, refers to a quantity of water added to
distillation column 22, “for example to the feed 40 or reflux 50” for the
purpose of forming DME for addition to extractor 27. See id. at 11:31–47.
Petitioner has not identified persuasive evidence on this record which
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evidences that either the quantity of water present in distillation column 22
as part of the reaction mixture, or any additional water added as an inhibitor,
would be sufficient to produce DME in the overhead of distillation column
22. In other words, we are not persuaded that column 11, lines 49–52 of the
’507 patent support Petitioner’s contention that the presence of any amount
of water during the distillation step(s) of a Monsanto-type process
necessarily results in the presence of DME in a PRC-enriched overhead
stream. See Ex. 1002, 11:38–41 (“By way of example, the applicants
observed that the concentration of methyl iodide in stream 64 dropped from
about 1.8% when no DME was present to about 0.5% when DME was
present.”) We note that “the real issue is” not “whether at least some DME
is formed,” as argued by Petitioner, Req. Reh’g 5, rather it is whether some
DME is present in the overhead distillation stream as recited in claim 25, Ex.
1002, 13:38–41.
In our Decision we agreed “Akinori [(Ex. 1013)] provides evidence
that DME is produced in an equilibrium reaction during production of acetic
acid by the Monsanto process.” Dec. 25. Akinori states, however, that the
intermediates formed in these equilibrium reactions, e.g., DME formed by
dehydration of methanol and hydrolysis of methyl iodide to form hydroiodic
acid (HI), ultimately change into acetic acid. Id. at 24 (citing Ex. 1013, 8).
Thus, we are not convinced of error in our finding that the combined
disclosures of the ’095 patent and the ’507 patent are insufficient to establish
a reasonable likelihood that the mere presence of some water in the ’095
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Patent distillation process inherently results in a PRC-enriched overhead
stream comprising DME. Id.
Petitioner contends we failed to give sufficient weight to Mr.
Cooper’s testimony, which corroborates that DME is necessarily present in
an overhead distillation stream in the ’095 patent process. Req. Reh’g 2–3.
Mr. Cooper testified that
[b]ecause the distillation in the ’095 Patent is conducted in the
presence of water, DME must have been produced in the
process described by the ’095 Patent. Thus, with the only
apparent difference between the ’095 Patent and the ’507 Patent
– specific reference to the presence of DME – is actually no
difference at all.
Ex. 1003 ¶ 63. Mr. Cooper acknowledged the fact that water is added to the
’095 patent and the ’507 patent processes for different purposes (see Ex.
1003 ¶¶ 60–61), but does not state that the quantities of water added for
these differing purposes would be the same, or explain why any differences
in the quantities would not effect the presence of DME in an overhead
distillation stream. Without factual support or further explanation, Mr.
Cooper’s conclusory opinion that the different purposes for adding water are
not relevant, see Ex. 1003 ¶ 63, simply is not persuasive.
With respect to Petitioner’s obviousness challenges, we considered
Mr. Cooper’s testimony that “the equilibrium reactions occurring in the
reactor are not controlling under distillation conditions, . . . [and] the amount
of DME can be increased by feeding water to the distillation column. Pet.
46–47 (citing Ex. 1003, ¶¶ 87–91).” Dec. 24. We determined, however,
Petitioner had not shown a reasonable likelihood it would prevail in showing
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obviousness of the claims, because “Petitioner has not articulated clearly
how one of ordinary skill in the art would have modified the ’095 patent and
Singh processes in view of Akinori to achieve ‘a PRC enriched overhead
stream comprising dimethyl ether’ as recited in claim 25.” Id. at 25.
Petitioner contends we erred by adopting Patent Owner’s unsupported
argument that differences in experimental conditions between Miura
Experiment 1 and the ’095 patent Example undermine Mr. Miura’s
testimony that DME would be present in the distillation overhead in the ’095
patent process. Req. Reh’g 4. Petitioner argues we erred “in reaching a
technical conclusion at this stage of the proceeding” that reaction rates
and/or impurity levels would have a bearing on the formation of DME and
that DME would not be present in the distillation overhead in the ’095 patent
process. Id. at 5–7. According to Petitioner, we did not cite evidence to
support this conclusion, and our conclusion is directly contrary to Mr.
Miura’s uncontroverted testimony that at least some DME is inevitably
present in the process of the ’095 patent. Id. at 6.
As an initial matter, we note that our rules permit, but do not require a
patent owner to file a preliminary response. See 37 C.F.R. § 42.107(a). It is
the petitioner who bears the burden of establishing a reasonable likelihood of
unpatentability of one or more claims. 37 C.F.R. § 42.108(c). Thus, the
Board’s decision on a petition for inter partes review is not confined to an
evaluation of the merits of the arguments presented by a petitioner in its
petition versus those made by a patent owner in its preliminary response.
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The Board is free to identify and discuss deficiencies in a petitioner’s
arguments and supporting testimony beyond those raised by a patent owner.
Nevertheless, we did not disregard or discredit Mr. Miura’s
declaration testimony; rather, we assessed the persuasiveness of Mr. Miura’s
testimony in light of other factual evidence in the record. See Dec. 18–20;
Velander v. Garner, 348 F.3d 1359, 1371 (Fed. Cir. 2003) (“It is within the
discretion of the trier of fact to give each item of evidence such weight as it
feels appropriate. . . . In giving more weight to prior publications than to
subsequent conclusory statements by experts, the Board acted well within
that discretion.”). We did not conclude DME is absent in the distillation
overhead in the ’095 patent Example. We found Mr. Miura’s testimony and
Experiment 1 were not persuasive evidence that DME would be present
inherently in the overhead distillation of the ’095 patent Example given the
differences in the ’095 patent Example and Experiment 1 reaction liquids,
which differences were not addressed adequately by Mr. Miura. In this
regard, we found Mr. Miura’s dismissal of these differences as “slight,”
without further discussion, was not persuasive in light of our actual
comparison of the ’095 patent Example and Experiment 1 that revealed
“Miura’s Experiment 1 contained more than twice the amount of rhodium
and about 34% of the amount of water used in the ’095 patent Example,”
(Dec. 18), and our review of the ’095 patent and Petitioner’s own patent,
U.S. Patent No. 7,683,212 B2 (Ex. 2014), that indicate these differences
would affect the reaction product (Dec. 20).
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Petitioner argues that in an opposition proceeding in the European
Patent Office (“EPO”) involving EP 05723599.6,
2
the EPO Opposition
Division found experimental results submitted by Daicel were convincing
evidence that DME is formed in EP-A-0687662 (the European counterpart
to the ’095 patent), and that we should give weight to this finding as “further
support[ing] the Petition’s contention that DME will be inevitably present in
the distillation overhead stream of the ’095 patent.” Req. Reh’g 9; see Pet.
29. As acknowledged by Petitioner, we are not bound by the findings of the
EPO Opposition Division. Pet. 28. Moreover, that the EPO Opposition
Division may have concluded DME is present in the EP-A-0687662 process
does not convince us of error in our Decision. The EPO Opposition
Division’s finding that DME is present in the overhead of EP-A-0687662
was based not only on D7 (Ex. 1026), a Certificate of Experiment which
appears to correspond to Experiment 1 in the Miura Declaration (Ex. 1005),
but also on D6 (Ex. 1025), a second Certificate of Experiment submitted by
Ryuji Saito.
3
See Ex. 1022, 6. In D6, Mr. Saito describes conducting
experiments according to the “Example and Example 1” of EP-A-0687662,
and repeating these experiments twice to prove the second overhead of EP-
A-0687662 comprises DME. Ex. 1025. If a party intends to rely on a

2
Petitioner identifies EP 05723599.6 as related to U.S. Patent No. 7,223,886
by virtue of common ownership by Celanese and subject matter directed to
acetic acid production. Pet. 28–29. The ’507 patent is a continuation of
U.S. Patent No. 7,223,886. Ex. 1002, at [63].
3
At a minimum, the reaction liquids described in Experiments 1 and 2 of D6
(Ex. 1025) differ from Experiment 1 in D7 (Ex. 1026).

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technical test or data from such test, it must provide an affidavit as set forth
in 37 C.F.R. § 42.65(b). Petitioner did not provide such affidavit with
respect to the experiments in D6. Therefore, unlike the EPO Opposition
Division, we did not have this additional experimental evidence before us in
considering whether the evidence on the record before us was sufficient to
support Petitioner’s contention that the ’095 patent process inevitably results
in an overhead distillation stream comprising DME.
B. Arguments Regarding Singh (Grounds 2–4)
Petitioner argues our Decision is based on an overly narrow
interpretation of the claim 25 distilling step
4
as requiring the presence of
sufficient DME to reduce the loss of methyl iodide (“MeI”) in the process.
Req. Reh’g. 12. Petitioner contends that, as a result of our erroneous claim
interpretation, we incorrectly found Petitioner had not provided adequate
evidence to support its contention that Singh’s process includes a distillation
step as recited in claim 25. Id. at 13. Petitioner argues, more specifically,
that our Decision indicates Petitioner must show Singh adds enough water in
the distillation step to produce DME in an amount sufficient to reduce the
loss of methyl iodide. Id. Petitioner contends the claim 25 distilling step is
met by a process in which any amount of DME is present in a PRC enriched
overhead stream, noting “[c]laim 25 does not call for any specific amount of

4
Claim 25 recites, in relevant part: “distilling [a] mixture [comprising
water, acetic acid, methyl iodide, methyl acetate, methanol, and at least one
permanganate reducing compound (PRC)] to separate the mixture into a
plurality of streams, at least one of said streams being a PRC enriched
overhead stream comprising dimethyl ether.”
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DME, and does not contain any limitations requiring the specific mechanism
of action by which DME is theorized to operate.” Id. at 12. Petitioner
maintains we failed to properly credit “Mr. Cooper’s informed testimony
that, if the addition of water during distillation formed DME according [to]
the ’507 patent, then DME must necessarily be present in Singh. Pet., 38
citing Ex. 1003, ¶70.” Req. Reh’g 11–12. Petitioner also contends we erred
in failing to accept its interpretation of statements made by Patent Owner
during prosecution of the ’507 patent as an admission that the presence of
any amount of water during distillation results in the presence of DME in an
overhead distillation stream. Id. at 14.
Turning first to Petitioner’s contention that we misinterpreted the
claims, our Decision did not include an express construction of any claim
terms. We agree with Petitioner that the claims do not recite a specific
quantity of DME. The challenged claims, however, do explicitly require the
presence of DME in a distillation overhead stream, not merely the presence
of DME in the distillation column. See Ex. 1002, 13:38–41 (claim 25). As
explained above in connection with the ’095 patent, there is evidence on this
record that DME is produced in an equilibrium reaction during production of
acetic acid by the Monsanto process, e.g., Akinori (Ex. 1013). Petitioner’s
evidence, however, is insufficient to support its contention that the presence
of any amount of water during distillation in a Monsanto-type process is
sufficient to produce DME in an overhead distillation stream.
Petitioner contends that, with respect to the addition of water to
distillation column 22, the disclosures of Singh and the ’507 patent are
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identical: “‘Stream 50 is added to column 22 to inhibit formation of
metaldehyde and paraldehyde impurities and higher molecular weight
polymers’ and both [Singh and the ’507 patent] disclose water as the
inhibitor making up stream 50.” Req. Reh’g 11 (quoting Ex. 1011, 11:27–
30; Ex. 1002, 10:19–23). Petitioner thus argues “there is no basis or
evidence on which to conclude that Singh does not result in the identical
formation of DME, just as is claimed to occur in the ’507 patent.” Id.; see
also id. at 12–13 (arguing column 11, lines 57–59 of the ’507 patent, which
“report[] Applicants’ belief that ‘water reacts with methyl acetate and/or
methyl iodide in [distillation] column 22 to form methanol, which is then
dehydrated in the presence of an acid catalyst (such as HI) to form DME,’
. . . support[] the unrebutted fact that when these materials are present in the
column, the reaction for DME proceeds”).
As indicated in our Decision, unlike Singh, the ’507 patent describes
adding water to column 22 for the purpose of producing DME in the
distillation overhead. See Dec. 6–7, 23–24 (quoting Ex. 1002, 11:45–47).
This description is separate from the ’507 patent description of adding water
for the purpose of inhibiting formation of metaldehyde and paraldehyde
impurities, which description is similarly presented in Singh. Compare Ex.
1011, 11:35–37 with Ex. 1002, 10:27–29. Neither Petitioner nor Mr. Cooper
explains why the quantity of water added by the ’507 patent for the purpose
of forming DME in the distillation overhead (Ex. 1002, 11:44–47) is thought
to be the same quantity added in Singh and the ’507 patent for the purpose of
inhibiting formation of impurities. See Ex. 1003 ¶¶ 68–70. Further, to the
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extent the Petition relies on Mr. Cooper’s opinion that the presence of any
amount of water in the distillation step(s) will result in formation of DME in
a distillation overhead, Petitioner has not convinced us of error in our
determination that Mr. Cooper’s opinion on this issue is not persuasive. Mr.
Cooper’s opinion is based on Petitioner’s interpretation of statements made
by Patent Owner during prosecution of the ’507 patent. See Dec. 23–24; id.
at 23 citing Ex. 1003 ¶ 69 (“I was also informed of an admission by
Celanese when prosecuting the ’455 Application, which led to the ’507
Patent, that DME was formed when water was added to the distillation step.
(Refer to Ex. 1009, p. 20). Based upon this, the addition of water in the ’171
Patent would also lead to DME formation.” (emphasis added)). In our
Decision, we did not find adequate support for Petitioner’s interpretation of
these statements as an admission that the presence of any amount of water in
the distillation step(s) of a Monsanto-type process is sufficient to form DME
in the distillation overhead. See Dec. 23. Petitioner has not convinced us
that, considering the Patent Owner’s arguments in context together with the
’507 patent in its entirety, we made an unreasonable judgment. See Req.
Reh’g 14; compare Pet. 10, 39–40 (citing Ex. 1009, 20 in support of its
contention that the addition of any amount of water to the distillation column
in a Monsanto-type process inherently results in DME in an overhead
distillation stream) with Ex. 1009, 22 (“[T]he water added to the distillation
column [in the Singh process] was added to inhibit formation of a viscous
and thixotropic polymer. . . . However, . . . Applicants . . . noticed that when
a sufficient amount of water was added to the distillation column, the
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amount of MeI in the aqueous phase was reduced . . . [and] that DME was
present in the stream. . . . [A]s a result of this unexpected and non-obvious
discovery that DME was formed in the distillation column when a sufficent
amount of water was added to the column and that this DME so-formed
reduced the solubility of MeI in water and yet, did not otherwise affect the
presently claimed invention, a second extraction step became possible.”).
C. Arguments Regarding Akinori (Grounds 3 and 4)
Petitioner argues we erred in stating the Petition fails
to provide [a] rationale for modifying the ’095 Patent and Singh
with Akinori (Dec., 25) because the Petition relies on Akinori
to demonstrate the understanding of a person of ordinary skill
in the art regarding the reaction chemistry of the acetic acid
production process disclosed in the ’095 Patent and Singh.
Req. Reh’g 9.
The first sentence under the discussion of Ground 3 in the Petition
reads: “Claims 25-28, 31-35, 37, 39, and 40 are invalid as obvious under
pre-AIA 35 U.S.C. § 103(a) over the ’171 Patent in view of the ’095 Patent
and Akinori, and as evidenced by the Miura Decl.” Pet. 44 (emphasis
added). Heading “i” under Ground 3 reads “Reason to Combine the ’095
Patent or the ’171 Patent with Akinori.” Id. The first sentence under the
discussion of Ground 4 in the Petition reads: “Claims 31-34, 37 and 39-41
are invalid as being obvious over the ’171 Patent in view of the ’095 Patent,
and further in view of Akinori and Japanese Patent Application No. 2000-
72712 (‘JP 2000-72712’), and as evidenced by the Miura Decl.” Id. at 49
(emphasis added). Heading “iii” under Ground 4 reads: “Reason to
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Combine the ’095 and ’171 Patents with Akinori and JP 2000-72712.” Id. at
50.
Petitioner’s argument is not consistent with its challenges as presented
in the Petition. Further, simply providing evidence that the ordinary artisan
possessed the knowledge and ability to modify the ’095 patent and/or the
’171 patent is insufficient to establish obviousness within the meaning of 35
U.S.C. § 103(a). See In re Kahn, 441 F.3d 977, 988 (Fed. Cir. 2006)
(“Rejections on obviousness grounds cannot be sustained by mere
conclusory statements; instead, there must be some articulated reasoning
with some rational underpinning to support the legal conclusion of
obviousness.”). Cf. In re Chaganti, 554 F. App'x 917, 922 (Fed. Cir.
2014)(nonprecedential) (“It is not enough to say that . . . to do so would
‘have been obvious to one of ordinary skill.’ Such circular reasoning is not
sufficient--more is needed to sustain an obviousness rejection.”); In re
Nouvel, 493 Fed. Appx. 85. 92 (Fed. Cir. 2012) (nonprecedential)
(“[C]ommon sense is not a hovering omnipresence. Instead, there must be
an articulated rational reason why the common sense of an ordinary artisan
would be awakened to modify prior art in such a way as to lead to an
obviousness rejection.”).
In any event, our decision to deny institution as to Grounds 3 and 4
was not based solely on Petitioner’s failure to explain the motivation to
modify the ’095 patent and/or Singh. See Dec. 25 (noting Mr. Cooper’s
testimony was not sufficiently persuasive to show a reasonable likelihood
that DME is present inherently in the overhead distillation streams of the
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’095 patent or Singh processes). Therefore, this argument fails to convince
us of error in our Decision.
II. CONCLUSION
On this record, we are not persuaded that denying inter partes review
of any challenged claim represents an abuse of discretion.
III. ORDER
Petitioner’s request for rehearing is denied.

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PETITIONER:

Jeffrey R. Lomprey
George C. Beck
FOLEY & LARDNER LLP
DAICEL_IPR@FOLEY.COM

PATENT OWNER:

Justin L. Krieger
Joshua B. Pond
Troy A. Peterson
KILPATRICK TOWNSEND & STOCKTON LLP
jkrieger@kilpatricktownsend.com
jpond@kilpatricktownsend.com
TPetersen@kilpatricktownsend.com