Daicel Corporationv.Celanese International Corporation

Patent Trials and Appeals Board

Jun 26, 2015

11788455 - (R) (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 IPR2015-00173
Patent 8,076,507 B2
_______________

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

GAUDETTE, Administrative Patent Judge.

DECISION
Request for Rehearing
37 C.F.R. § 42.71

IPR2015-00173
Patent 8,076,507 B2

2

On May 1, 2015, Daicel Corporation (“Petitioner”) filed a Request for
Rehearing (Paper 14, “Req. Reh’g”) of our Decision denying inter partes
review (Paper 13, “Dec.”) of claims 58–60, 67, and 69–73 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 2, “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 reasons that follow, Petitioner’s Request for Rehearing is granted-
in-part and institution of an inter partes review is ordered.
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).
With respect to the challenges based on the ’095 patent (Grounds 1, 3
and 4) and the challenges based on Singh (Grounds 2–4), Petitioner contends
IPR2015-00173
Patent 8,076,507 B2

3

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 also argues our Decision was
based on an erroneous claim interpretation. Id. at 12–13. We address each
of Petitioner’s contentions in detail below.
A. Ground 1 – Anticipation of Claims 58–60, 67, 69, 71 and 72 by
the ’095 Patent
Petitioner contends our Decision declining to institute trial on this
ground was based improperly on potential concerns with the experiment
(“Experiment 1”) described in the Miura Declaration (Ex. 1005), and failed
to appreciate that “the process of the ’095 patent [(Ex. 1010)], and the
teachings of the ’507 patent [(Ex. 1002)] 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 58.” Req. Reh’g. 3; see id. at 1–4.
Petitioner argues “the Miura Declaration is simply a confirmatory and
secondary inclusion to the Petition,” which “relies primarily on the Cooper
Declaration (Ex. 1003) in support of its contention that DME is necessarily
produced and present in the overhead stream of the ’095 patent as called for
in Claim 58.” Id. at 2. Petitioner contends we failed to give sufficient credit
to Mr. Cooper’s opinion. Id. at 2–4.
In our Decision, we gave little weight to Mr. Cooper’s testimony that
DME was necessarily present in a PRC enriched overhead distillation stream
of the ’095 patent process, because we determined Mr. Cooper’s opinion
was based on: (1) an unsupported assumption that the presence of any
IPR2015-00173
Patent 8,076,507 B2

4

amount of water in the distillation step of a Monsanto-type process would
necessarily result in the presence of DME in the overhead distillation stream,
and (2) results of Miura Experiment 1, for which Petitioner had not provided
sufficient evidence of correspondence to the examples in the ’095 patent.
See Dec. 21. On page 3 of its Rehearing Request, Petitioner directs us to,
inter alia, pages 22–23 of its Petition, wherein it states:
As explained by Mr. Cooper, the ’095 Patent teaches that
acetic acid is produced by reacting methanol with carbon
monoxide in the presence of rhodium catalyst, iodide salts, and
methyl iodide. (Ex. 1003, ¶ 46). It is well-known that such a
mixture will produce at least some amount of dimethyl ether
through equilibrium processes. (Ex. 1003, ¶ 95, citing to
Akinori p. 7-8. As indicated by the very low boiling point
(-23.7 ºC) dimethyl ether it is extremely volatile compared to
other reaction components such as acetic acid and acetaldehyde
and will readily distill from the reaction mixture when it
flashes, thereby appearing in the overhead streams from
subsequent distillations. (Ex. 1003, ¶¶ 97, 99 citing Ex. 1017).
We agree that we misapprehended the significance of this argument in
the Petition, and overlooked the fact that Mr. Cooper’s opinion is also based
on his own calculations and data in two published articles. See Ex. 1003
¶ 97. Specifically, Mr. Cooper approximates reactor DME equilibrium
concentrations in the ’095 patent examples and explains how these
approximations were obtained using readily available data, specifically
identifying data in two published articles. Ex. 1003 ¶ 97 (citing Exs. 1029,
1030). Mr. Cooper goes on to explain why, based on the reactor contents
and distillation conditions in the ’095 patent examples, DME and
IPR2015-00173
Patent 8,076,507 B2

5

acetaldehyde would be present in the overhead distillation streams. Id.
¶¶ 99–100.
Because Petitioner has shown Mr. Cooper’s testimony is supported by
underlying factual evidence, and is not based solely on an unsupported
assumption and the Miura Declaration, we determine Mr. Cooper’s
testimony provides persuasive support for Petitioner’s contention that DME
is inherently present in an overhead distillation stream of the ’095 patent
process, and that claim 58 is anticipated by the ’095 patent. We have also
reviewed the Petition’s analysis of dependent claims 59, 60, 67, 69, 71, and
72, and conclude Petitioner has provided sufficient explanation and evidence
to support a reasonable likelihood that the additional limitations of these
claims are described in the ’095 patent. See Pet. 25–30.
In sum, at this stage of the proceeding Petitioner has established a
reasonable likelihood that it would prevail on the merits in showing claims
58–60, 67, 69, 71, and 72 are anticipated by the ’095 patent. Therefore, the
Request for Rehearing is granted and trial is instituted as to this challenge.
B. Ground 2 – Obviousness of Claims 58–60, 67, and 69 Over Singh
Petitioner argues our decision declining to institute trial as to this
ground is based on an overly narrow interpretation of claim 58 as requiring
the presence of sufficient water in the distillation process to produce DME in
an amount adequate to reduce the solubility of methyl iodide (MeI) in the
process stream. Req. Reh’g. 11–13. Petitioner contends claim 58 does not
call for any specific amount of DME or require a specific mechanism of
action to reduce MeI. Id. at 12–13; see also id. at 13 n.2 (directing us, e.g.,
IPR2015-00173
Patent 8,076,507 B2

6

to Mr. Cooper’s testimony that MeI concentration can be affected by other
factors such as extraction temperature). Petitioner argues that because of
this erroneous claim interpretation, we further erred in denying institution on
the basis that the Petition does not show Singh adds a “sufficient amount” of
water in the distillation step to meet the claim 58 limitations. Id. at 13.
Petitioner argues we improperly focused on Singh’s disclosure of using only
small amounts of water (id. at 10), and statement that water is a least
preferred inhibitor (id. at 14). Petitioner contends that, with respect to the
addition of water to distillation column 22 as an inhibitor, the ’507 patent
and Singh disclosures are identical. Id. at 14–15. Thus, because the ’507
patent states that the amount of water added to column 22 is sufficient to
obtain DME in the overhead, the amount of water added in Singh must
likewise result in an overhead distillation stream comprising DME as recited
in claim 58. Id. at 15.
Our Decision did not include an express construction of any claim
terms, and we agree, for purposes of this decision, that claim 58 does not
require a specific quantity of DME in the distillation overhead. We do not
agree with Petitioner, however, that the Singh and ’507 patent disclosures
are identical with respect to the addition of water to distillation column 22.
As indicated in our Decision, both Singh and the ’507 patent describe
adding small amounts of water to column 22 for the purpose of inhibiting
impurity formation. See Dec. 5–6. The ’507 patent, however, includes
additional description of adding water to column 22 for the purpose of
producing DME in the distillation overhead. See Dec. 6–7 (citing Ex. 1002,
IPR2015-00173
Patent 8,076,507 B2

7

col. 11). This additional description of adding water to produce DME in the
distillation overhead does not refer back to the description of adding water
as an inhibitor (see Ex. 1002, 10:9–32), or otherwise indicate that the small
amounts of water used to inhibit impurity formation in the ’507 patent and
Singh processes would produce DME in the distillation overhead.
In sum, Petitioner has not convinced us that our Decision was based
on an erroneous claim interpretation or that we somehow misapprehended
Singh’s disclosure as teaching away from the addition of any amount of
water. Therefore, the Request for Rehearing is denied as to this challenge.
C. Ground 3 – Obviousness of Claims 58–60, 67, 69, 71, and 72
Over Singh, the ’095 Patent, and Akinori
Petitioner contends we abused our discretion in declining to institute
trial on this ground for the same reasons expressed in connection with the
challenges based on the ’095 patent and Singh, individually (Grounds 1 and
2). See Pet. 9, 15.
In Section I.A., above, we granted Petitioner’s request for rehearing
with respect to Ground 1, concluding Petitioner had established a reasonable
likelihood that it would prevail on the merits in showing claims 58–60, 67,
69, 71, and 72 are anticipated by the ’095 patent. Petitioner has not
articulated a substantive difference between the present obviousness
challenge and the anticipation challenge based on the ’095 patent. See, e.g.,
Pet. 43 (“Petitioner asserts that Grounds 1 and 2 above, regarding
anticipation and obviousness of several of the claims by the ’171 and ’095
Patents alone are applicable here. However, Petitioner further asserts that to
the extent the ’171 and ’095 Patents fail to expressly acknowledge the
IPR2015-00173
Patent 8,076,507 B2

8

presence of DME, Akinori [(Ex. 1013)] provides a basis for the person of
ordinary skill in the art to readily understand that DME is in equilibrium
with other components of the systems.”); id. at 44–46 (wherein the claim
chart refers to the ’095 patent for each of the limitations recited in claims
58–60, 67, 69, 71, and 72). Accordingly, we exercise our discretion under
35 U.S.C. § 314(a) and decline to institute inter partes review of claims
58–60, 67, 69, 71, and 72 over the ’095 patent and Akinori. See Pet. 44–46
(wherein the ’095 patent is relied on individually, or in combination with
Akinori, in challenging claims 58–60, 67, 69, 71, and 72).
In Section I.B., above, we determined Petitioner had not shown error
in our Decision declining to institute trial with respect to the obviousness
challenge based on Singh. For the same reasons, Petitioner has not shown
error in our Decision declining to institute trial with respect to the
obviousness challenge based on Singh in view of the’095 patent and
Akinori. See Pet. 45–46 (wherein Singh is relied on individually, or in
combination with Akinori, in challenging claims 58–60, 67, and 69, and the
’095 is relied on for the features recited in claims 71 and 72).
D. Ground 4 – Obviousness of Claims 71–73 Over Singh, the ’095
Patent, Akinori, and JP ’712
Petitioner contends we abused our discretion in declining to institute
trial on this ground for the same reasons expressed in connection with the
challenges based on the ’095 patent and Singh, individually (Grounds 1 and
2). See Pet. 9, 15. This challenge, though phrased as a combination of all
four references, is argued in the Petition as alternative grounds based on
either the combination of Singh, the ’095 patent, Akinori, and JP ’712, or the
IPR2015-00173
Patent 8,076,507 B2

9

combination of the ’095 patent, Akinori, and JP ’712. See Pet. 47 (“The
reasons to combine the ’171 Patent, ’095 Patent, and Akinori are outlined for
Ground[] 3, and those reasons are incorporated into this ground.”)
With respect to the combination of Singh in view of the ’095 patent,
Akinori, and JP ’712 (Ex. 1020), we are not convinced of error in our
Decision declining to institute trial for the same reasons discussed in
connection with the obviousness challenge based on Singh alone. See
Section I.B. supra.
With respect to the combination of the ’095 patent, Akinori, and
JP ’712, in our Decision, we declined to institute trial because Petitioner had
not explained how JP ’712 cured the deficiencies in its challenge based on
anticipation by the ’095 patent. Dec. 25. We have reconsidered this
decision in light of the arguments made in Petitioner’s Request for
Rehearing and subsequent conclusion herein that the Petition establishes a
reasonable likelihood Petitioner would prevail on the merits in showing
claims 58–60, 67, 69, 71, and 72 are anticipated by the ’095 patent. See
Section I.A., above.
With respect to claims 71–73, Petitioner relies on JP ’712 for a
teaching of “direct recycling of the organic phase obtained in a water
extraction process to a reaction vessel containing methanol, DME or methyl
acetate to react with carbon monoxide in the presence of a rhodium catalyst,
an iodide salt and methyl iodide.” Pet. 48. Motivation for recycling of alkyl
iodide, according to Petitioner, is the effective use of the raw material and
prevention of adverse effects on the environment due to the alkyl iodide
IPR2015-00173
Patent 8,076,507 B2

10

mixed in the waste liquid. See id. (citing Ex. 1019 ¶ 21). Petitioner
contends JP ’712 “demonstrates that methyl iodide concentration can be
controlled by extraction temperature, an element absent in [the] ’507
[patent], and that the concentrations recited in claims 71-73 are well known
in the art.” Id. at 49. Petitioner notes Table 1 of JP ’712 specifically
discloses a reduction from 1.7% to 0.1% in the amount of methyl iodide in
the process liquid was obtained by increasing the extraction temperature
from 13 ºC to 47 ºC. Pet. 48 (citing Ex. 1020, 22, Comparative Example 1
and Example 2).
Petitioner has not articulated a substantive difference between the
present obviousness challenge as to claims 71 and 72 and the anticipation
challenge based on the ’095 patent. Compare Pet. 30, with id. at 49–50.
Accordingly, we exercise our discretion under 35 U.S.C. § 314(a) and
decline to institute inter partes review of claims 71 and 72 over the ’095
Patent, Akinori, and JP ’712.
Claim 73 is challenged only under this ground. Claim 73 depends
directly from independent claim 58, and reads:
The method of claim 58, wherein said dimethyl ether is present
in said PRC enriched overhead stream at a concentration
sufficient to produce said first aqueous extract stream
comprising said at least one PRC and said second aqueous
extract stream comprising said at least one PRC, wherein each
of said aqueous extract streams have a methyl iodide
concentration of less than or equal to about 0.5 wt %.
Ex. 1002, claim 73.
IPR2015-00173
Patent 8,076,507 B2

11

In Section I.C., above, we declined to institute trial on claim 58 based
on the combination of the ’095 patent and Akinori, based on our
determination in Section 1.A., above, that Petitioner had established a
reasonable likelihood it would prevail on the merits in showing claim 58 was
anticipated by the ’095 patent alone, and the Petition did not articulate a
substantive difference between the two challenges. In the present challenge,
the Petition fails to explain how Akinori is relied upon for a teaching of a
claim 73 feature not described in the ’095 patent. See Pet. 47–51. The
Petition does explain, however, why claim 73 would have been obvious over
the combination of the ’095 patent and JP ’712. See id. at 50–51. Based on
the record before us, Petitioner has established a reasonable likelihood it
would prevail in showing claim 73 would have been obvious over the ’095
patent and JP ’712.
Therefore, the Request for Rehearing is granted as to claim 73, and
trial is instituted based on the combination of the ’095 patent and JP ’712.
II. CONCLUSION
On this record, Petitioner has demonstrated that the Decision Denying
Institution should be modified to institute an inter partes review of
Petitioner’s challenges as to claims 58–60, 67, 69, 71, and 72 based on
anticipation by the ’095 patent and claim 73 based on obviousness over the
’095 patent and JP ’712.
IPR2015-00173
Patent 8,076,507 B2

12

III. ORDER
Petitioner’s request for rehearing is granted-in-part, and it is hereby:
ORDERED that inter partes review is instituted with respect to the
following grounds of unpatentability:
(1) Whether claims 58–60, 67, 69, 71, and 72 are unpatentable under
35 U.S.C. § 102(b) as anticipated by the’095 patent; and
(2) Whether claim 73 is unpatentable under 35 U.S.C. § 103(a) as
having been obvious over the’095 patent and JP ’712;
FURTHER ORDERED that no ground other than those specifically
instituted above is authorized for the inter partes review;
FURTHER ORDERED that pursuant to 35 U.S.C. § 314(a), inter
partes review of the ’507 patent is hereby instituted commencing on the
entry date of this Order, and pursuant to 35 U.S.C. § 314(c) and 37 C.F.R. §
42.4, notice is hereby given of the institution of a trial.

IPR2015-00173
Patent 8,076,507 B2

13

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