Velodyne LiDAR, Inc.

Patent Trials and Appeals Board

May 21, 2020

IPR2018-00255 (P.T.A.B. May. 21, 2020)

Trials@uspto.gov Paper 62
571-272-7822 Entered: May 21, 2020

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

QUANERGY SYSTEMS, INC.,
Petitioner,

v.

VELODYNE LIDAR, INC.,
Patent Owner.
____________

Case IPR2018-00255
Patent 7,969,558 B2
____________

Before CARL M. DEFRANCO JR., JOHN P. PINKERTON, and
MICHAEL L. WOODS, Administrative Patent Judges.

DEFRANCO, Administrative Patent Judge.

DECISION
Denying Petitioner’s Request for Rehearing
37 C.F.R. § 42.71(d)
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I. INTRODUCTION
Quanergy Systems, Inc. (“Quanergy”) filed a Petition requesting inter
partes review of claims 1–4, 8, and 9 of U.S. Patent No. 7,969,558 B2 (“the
’558 patent”). Paper 2 (“Pet.”). Velodyne LiDAR, Inc. (“Velodyne”) is the
owner of the ’558 patent. See Paper 6. After a trial on the merits, we issued
a Final Written Decision holding that Quanergy had not shown the
challenged claims unpatentable by a preponderance of the evidence.
Paper 59 (“Final Dec.”). Quanergy filed a Request for Rehearing of that
decision. Paper 61 (“Rehearing Request” or “Reh’g Req.). For the
following reasons, we deny Quanergy’s Rehearing Request.
II. STANDARD OF REVIEW
A party requesting rehearing of a Board decision has the burden to
show that the decision should be modified. Pursuant to 37 C.F.R.
§ 42.71(d), the rehearing request must identify, specifically, all matters the
party believes the Board misapprehended or overlooked, and the place where
each matter was previously addressed in a motion, an opposition, or a reply.
When rehearing a decision on a petition, we review 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. In re Gartside, 203 F.3d 1305, 1315-16
(Fed. Cir. 2000).
III. ANALYSIS
Quanergy asserts several reasons for why it believes the Board should
reconsider its Final Decision that Quanergy had not carried its burden of
showing the claimed invention would have been obvious. First, Quanergy
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maintains that we erred in denying its motion to exclude certain exhibits.
Reh’g Req. 1–3. Second, Quanergy argues we erred in our evaluation of
Velodyne’s objective evidence of non-obviousness. Id. at 3–8. And, finally,
Quanergy contends that we erred in finding the challenged claims
unpatentable over the asserted prior art references—either Mizuno alone or
Mizuno in combination with Kilpela. Id. at 8–15. We address each
argument in turn.
A. Whether We Erred in Our Admission of Certain Exhibits
Quanergy argues that we erred by permitting Exhibits 2040, 2074,
2076, 2082, and 2098 into evidence over its objections of inadmissible
hearsay. Reh’g Req. 1 (citing Pet. Mot. 3–9, 11; Pet. Reply to Mot. 1–4).
According to Quanergy, we should have excluded the contents of each
exhibit because Velodyne “relied on that content to prove the truth of
specific objective evidence arguments.” Id. But in making this assertion,
Quanergy explains only how “Exhibit 2040 (a Forbes article)” is
purportedly inadmissible hearsay. Id. at 1–2. Nowhere does Quanergy
provide meaningful explanation for why the other exhibits are inadmissible.
See id. In any event, we address below Quanergy’s assertion of error as to
the admissibility of each of these exhibits.
1. Exhibit 2040
Quanergy asserts that we relied improperly on Exhibit 2040 as proof
of Velodyne’s “skyrocketing” revenues “for years 2014–2017 and half of
2018.” Reh’g Req. 1–2 (citing Final Dec. 36). At the outset, we note that
Quanergy appears to misunderstand our reliance on Exhibit 2040. In our
Final Decision, we did not rely on Exhibit 2040 as proof of Velodyne’s
revenues for the years 2014–2017. Final Dec. 36 (citing “Exs. 2084–87,
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2095”). Instead, we relied on Exhibit 2040 solely as proof of Velodyne’s
“expected” revenue for the year 2018. Id. (citing Ex. 2040, 3).
More specifically, our Final Decision cited Exhibits 2084–2087 and
2095, not Exhibit 2040, to support our finding that “[b]etween 2013 and
2017, Velodyne’s annual revenues from sales of sensors embodying the
claimed invention went from tens of millions to hundreds of millions in
dollars.” Id. (citing “Exs. 2084–87, 2095”). Because Quanergy never
challenged the admissibility of Exhibits 2084–87 and 2095 (see Paper 51),
we could not have erred in considering those exhibits as proof that Velodyne
enjoyed considerable revenue growth from 2013 to 2017.
We acknowledge, however, that our Final Decision did rely on
Exhibit 2040 as proof of Velodyne’s projected revenues in 2018, namely,
that they were “expected to be about $200 million.” Final Dec. 36–37
(citing Ex. 2040). But what Quanergy ignores is that we also cited Exhibit
2113 to prove the same point. Id. (citing Ex. 2113). And while Quanergy
sought to exclude Exhibit 2040, it never sought to exclude Exhibit 2113,
which is a detailed market analysis projecting Velodyne’s revenues in 2018
to be “$250M” based on partnerships with “[a]lmost all robotic car
manufacturers.” See Ex. 2113, 81. So, even had we excluded Exhibit 2040
as Quanergy originally requested, Exhibit 2113, as well as previously
discussed Exhibits 2084–2087 and 2095, fully support our finding that
Velodyne’s revenues “went from tens of millions to hundreds of millions in
dollars.” Final Dec. 36. To the extent our citation to Exhibit 2040 may have
given rise to error, it was harmless given that unchallenged Exhibit 2113
proves the same point.
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2. Exhibits 2040, 2074, 2076, and 2098
Quanergy also argues that we “erred in relying on Joy Techs., Inc. and
Freeman to support [our] non-hearsay ruling” with respect to Exhibits 2040,
2074, 2076, and 2098. Reh’g Req. 2. According to Quanergy, “these cases
have nothing to do with objective evidence where both the content and the
truth of the evidence matter.” Id.
In our Final Decision, we concluded that the exhibits are not hearsay,
as they are evidence of industry praise and were not offered for the truth of
the matter asserted therein. Final Dec. 38–39. Specifically, we explained
We rely on those exhibits as evidence of industry praise. . . . For
instance, Exhibits 2040, 2076, and 2098 are articles from Forbes,
The Verge, and Bloomberg, respectively, reporting
independently on the wide recognition and adoption of
Velodyne’s sensors by the industry. We do not consider news
articles such as these to be inadmissible hearsay as they are
“offered simply as evidence of what [each] described, not for
proving the truth of the matters addressed in the document.” Joy
Techs., Inc. v. Manbeck, 751 F. Supp. 225, 233 n.2 (D.D.C. 1990)
aff’d, 959 F.2d 226 (Fed. Cir. 1992); Freeman v. Minnesota
Mining and Manuf. Co., 675 F. Supp. 877, 884 n.5 (D. Del.
1987).

Final Dec. 38–39.
While admittedly Joy Technologies and Freeman do not address
objective evidence per se, these cases nonetheless support the notion that
statements offered solely for the purpose of showing they were made are
admissible. Indeed, as explained in the advisory committee note to Federal
Rule of Evidence 801(c), “[i]f the significance of an offered statement lies
solely in the fact that it was made, no issue is raised as to the truth of
anything asserted, and the statement is not hearsay.” Fed. R. Evid. 801(c)
1997 Adv. Comm. Note.
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Consistent with that reasoning, we allowed into evidence Exhibits
2040, 2074, 2076, and 2098 because they were offered solely for the fact
that the statement of praise was made. See Final Dec. 39. Numerous courts
have come to the same conclusion, namely, it is the existence of the
statements of praise themselves that is relevant. As such, “courts have
properly found that articles showing the receipt of ‘awards and accolades’
are admissible over a hearsay objection.” Asetek Danmark A/S v. CMI USA,
Inc., 2014 WL 12644295, at *2 (N.D. Calif. Nov. 19, 2014) (collecting
Federal Circuit and district court cases). Thus, we reject Quanergy’s
assertion that we misapprehended or overlooked the relevant case law by
admitting Exhibits 2040, 2074, 2076, and 2098 as evidence of industry
praise.
3. Exhibit 2082
Quanergy also argues that we erred by failing to exclude Exhibit 2082
as inadmissible hearsay. Reh’g Req. 1–2. In seeking exclusion, Quanergy
argued that, because “Exhibit 2082 is Velodyne’s own press release” in
which Velodyne is “simply praising itself,” such “self-praise should be
excluded.” Paper 51 at 8–9 (case citations omitted).
In our Final Decision, we agreed with Quanergy that Velodyne’s
Exhibit 2082, along with several other exhibits, “appear to be self-serving
statements” and, thus, “we do not rely on those exhibits” as evidence of
industry praise. Final Dec. 35–36. We explained that there was no need to
rely on Exhibit 2082 because “a plethora of other evidence is clearly
objective in nature and amounts to strong evidence of industry praise.” Id. at
36. That said, however, our Final Decision noted that Exhibit 2082 was
admissible as contemporaneous evidence of the construction of Velodyne’s
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HDL-64E sensor for purposes of showing how it “resolved a long-felt need.”
See id. at 36 n.10. And while Exhibit 2082 represented Velodyne’s own
description of the HDL-64E sensor (see id. at 33), we viewed the question of
its accuracy and reliability as going to weight of the evidence, not its
admissibility.
As for the weight we ascribed to Exhibit 2082, the record is replete
with objective evidence corroborating the accuracy and reliability of
Velodyne’s description of the HDL-64E in the relevant time frame.
Specifically, Quanergy’s own evidence includes a contemporaneous
description of Velodyne’s HDL-64E sensor that is no different than that of
Exhibit 2082. See Ex. 1090 at 7 (“User’s Manual” dated “2008.”); Ex. 1091
(“Overview” dated “2007”). In addition, numerous other contemporaneous
documents describe the HDL-64E sensor in essentially the same manner as
Exhibit 2082. See, e.g., Ex. 2046 (dated “January 4, 2009”); Ex. 2059 (dated
“October 2007”); Ex. 2091 (dated “7th November 2007”). But Quanergy
never challenged the admissibility of those exhibits. See Paper 51 at 1.
Thus, we reject Quanergy’s assertion that we should exclude Exhibit 2082
where the record evidence overwhelmingly corroborates the accuracy and
reliability of the description therein.
B. Whether We Erred in Giving Substantial Weight to Velodyne’s Objective
Evidence of Non-Obviousness
1. Presumption of Nexus
Quanergy argues that we erred by relying on “over 150 paragraphs
from [Velodyne’s expert] declaration, which were improperly incorporated
by reference into PO’s Response and cannot be used to support the
presumption of nexus.” Reh’g Req. 3 (citing Reply 21). According to
Quanergy, the entirety of Velodyne’s nexus argument is “a single sentence
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in its Response” with “cites to over sixty paragraphs (60) paragraphs” of
the expert’s declaration for one product and “cites to ninety (90)
paragraphs” for three other products. Id. at 4–6 (citing PO Resp. 53–55).
We disagree. Between its Patent Owner Response and Sur-Reply,
Velodyne presented extensive argument of a presumption of nexus (no less
than seven pages), explaining how “Velodyne’s HDL-64E, HDL-32E, VLP-
32, and VLP-16 sensors practice the challenged claims, and the claimed
invention is not a subcomponent of the entire product.” See PO Resp. 53–57
(citing Ex. 2115 ¶¶ 218–372); see also PO Sur-Reply 25–27 (presenting
additional argument on presumption of nexus). Velodyne bolstered its
argument with expert testimony in which the expert undertakes a detailed
comparison of how each of Velodyne’s four sensor-types embody each of
the claim elements and is coextensive with them. See PO Resp. 53–56. For
instance, as shown below, Velodyne associates a particular range of expert
testimony with each claim element, including the claimed “lidar-based 3-D
point cloud system” [i.e., preamble], “support structure,” “laser emitters,”
“avalanche photodiode detectors” [i.e., APDs], and “rotary component”:
Eden Decl. ¶¶ 225–229 (preamble), ¶¶ 240–242 (annotating
Exs. 2099 and 2100 to show support structure), ¶¶ 250–258
(laser emitters, citing, e.g., Exs. 2099, 2100, and 2050 at 4–5),
¶¶ 273–278 (APDs, citing, e.g., Ex. 2024, Ex. 2050 at 42),
¶¶ 288–297 (rotary component, citing, e.g., Exs. 2026, 2027 and
2050 at 2).

Id. at 54; see also Ex. 2048, 1–2 (HDL-64E “Specifications”); Ex. 2059, 4–7
(“HDL-64E Product Description,” dated October 2007); Ex. 1090, 3, 6–15
(“HDL-64E User’s Manual”). Velodyne provided a similar comparison for
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each of its other product models, namely, its HDL-32E, VLP-32, and VLP-
16 sensors.1 PO Resp. 54–56.
To the extent Quanergy asserts now that Velodyne was required to
duplicate its expert’s analysis in the body of its Response, we reject any such
notion. Our rules specify that “[a]rguments must not be incorporated by
reference from one document into another document.” 37 C.F.R.
§ 42.6(a)(3). As shown above, Velodyne presented clear argument of a
presumption of nexus, while also citing specific testimonial evidence in
support of that argument. See PO Resp. 53–57. And, contrary to
Quanergy’s assertion, Velodyne’s citations were confined to a limited range
of testimony for each claim element and each product model. As for the
volume of Velodyne’s citations, it arose not from an attempt to abuse our
process, but from the necessity of its expert to conduct a proper and
complete analysis of the evidence by reviewing the patent claims, studying
Velodyne’s product literature, and comparing each of Velodyne’s products
to the patent claims. By no means does Velodyne’s reliance on the careful
and independent analysis of its expert run afoul of our rules regarding
improper incorporation by reference. Thus, we reject Quanergy’s argument
of a procedural infirmity with Velodyne’s presumption of nexus analysis.
Aside from arguing that procedural infirmity, Quanergy never
disputed that Velodyne’s products include the claimed features. See Pet.
Reply 20–22 (arguing only that Velodyne “fails to show its products practice

1 The Final Decision mistakenly omitted supporting citations for the VLP-32
and VLP-16 models. The correct citation, at the top of page 30 of the Final
Decision, should read “Ex. 2115 ¶¶ 230–239, 243–248, 259–272, 279–287,
298–313 (citing Exs. 2023, 2032, 2034, 2042, 2044, 2058, 2060, 2062,
2093, 2101, 2102, 2104–2108, 2110, 2111).
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the claims, because it merely improperly incorporates by reference its
arguments from other documents); Reh’g Req. 3–6 (same). As the Federal
Circuit has routinely held, when a patent owner presents expert testimony
showing its product is the invention disclosed in the challenged claims, and
the patent challenger presents no evidence to the contrary, it is error for the
Board to fail to credit that undisputed testimony in the first instance. Polaris
Indus., Inc. v. Arctic Cat, Inc., 882 F.3d 1056, 1072–73 (Fed. Cir. 2019)
(“Polaris”). So, to avoid a presumption of nexus that finds support through
expert testimony, a petitioner must at least point to some limitation it
contends the expert got wrong. Here, Quanergy did no such thing. As noted
in our Final Decision, “Quanergy never disputes the testimony of
Velodyne’s expert showing that the HDL-64E, HDL-32E, VLP-32, and
VLP-16 products embody the claimed invention, let alone point to any
missing limitations.” Final Dec. 29–30 (citing Pet. Reply 20–23; Pet. Sur-
SurReply 1–5). Thus, under Polaris and its progeny, we did not err in
giving considerable weight to the testimony of Velodyne’s expert in finding
a presumption of nexus.2
2. Commercial Success
Quanergy argues that we erred in finding that Velodyne’s products
achieved a high-degree of commercial success. Reh’g Req. 7–8 (citing Final
Dec. 36–37). According to Quanergy, we overlooked its argument that
Velodyne “improperly inflated” its market share by failing to compare it

2 The Board decisions cited by Quanergy to show improper incorporation by
reference do not persuade us otherwise. See Reh’g Req. 3–6. Those
decision were decided before Polaris, and, thus, are inapposite here.

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against “the general ‘mechanical 3-D lidar sensor’ industry.” Id. at 7 (citing
Pet. Reply 25) (emphasis added).
We could not have overlooked an argument that was never made.
During trial, Quanergy never argued that the relevant market is 3-D lidar
sensors in “general.” See Pet. Reply 24–25. Instead, in reply to Velodyne’s
definition of the relevant market as “3-D LiDAR sensors for autonomous
vehicles,” Quanergy simply stated “[t]his is not the relevant market” and
“[t]here is no comparison of [Velodyne’s] market share with respect to a
properly defined market.” Id. (emphasis added). But nowhere did Quanergy
define what it thought the relevant market should be, nor did it proffer any
evidence in rebuttal of Velodyne’s definition of the relevant market. Indeed,
a comparison of Quanergy’s argument on rehearing with its argument at trial
bears out this failure. Compare Reh’g Req. 7 (citing Exs. 1003, 2113), with
Pet. Reply 24–25 (omitting citation to those exhibits). As such, we
discounted Quanergy’s assertion as nothing more than conclusory attorney
argument, particularly given the myriad evidence from Velodyne showing
that the relevant market is “3-D LiDAR sensors for autonomous vehicles”
and that its sales represented a commanding share of that market. PO Resp.
69–70 (citing Exs. 2064, 2074, 2087, 2095, 2098, 2113); see also Final
Dec. 37 (citing same exhibits in finding “Velodyne created a new market in
autonomous navigation”).
In sum, Quanergy cannot belatedly introduce exhibits previously
omitted from its Reply, namely, exhibits 1003 and 2113, to argue anew that
Velodyne “has not shown a breakdown of AV [autonomous vehicle] vs.
non-AV sales.” Reh’g Req. 7–8. The time to do so was during trial, either
through its Reply or Sur-SurReply. But, rather than follow through with its
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burden to submit actual evidence to rebut Velodyne’s myriad evidence as the
relevant market and its share of that market, Quanergy chose instead to rely
on conclusory attorney argument. See Pet. Reply 25. Having done so,
Quanergy cannot now attempt to resurrect its conclusory attorney argument
with previously uncited evidence. Thus, we reject the notion that we
somehow overlooked evidence that was never properly presented to us in the
first instance.3
C. Whether We Erred in Our Construction of “lidar”
According to Quanergy, we erred in construing the claim term “lidar,”
as recited in the preamble of claim 1, to mean “pulsed time-of-flight (TOF)
lidar.” Reh’g Req. 8–12 (citing Final Dec. 12). At the outset, we note that
our Final Decision construed the term “lidar” in the context of the
preamble’s recitation of a “lidar-based 3-D point cloud system.” Final Dec.
9–12. In doing so, we looked to the specification of the ’558 patent and
found that it supports a construction that limits the claimed “lidar-based”
system to a pulsed time-of-flight lidar system. Id. at 10–12. Our reasoning
was simple—“the specification starts with the basic premise of utilizing the

3 Even were we to consider Quanergy’s argument, our finding of
commercial success would stand because Quanergy’s own evidence informs
us that the vast majority of Velodyne’s sales of 3-D LiDAR are in the
market of autonomous vehicle navigation with only “moderate” sales for
other applications. See Ex. 1130, 27 (“Velodyne LiDAR is currently used
by most autonomous car research teams which the company manufactures in
Morgan Hill, California . . . Here they have been engineered, tested, and
[sold] for five years and also sold in moderate industrial quantities.”); see
also Ex. 2113, 4, 81 (reporting on “The Automotive LIDAR Market” and
noting that Velodyne’s “Investors” include “Baidu” and “Ford,” two
manufacturers of robotic cars, and Velodyne’s “Main partners” include
“Almost all robotic car manufacturers.”).
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timing of laser pulses to derive distance measurements and then builds upon
that premise by focusing on how to improve the pulses per second of
existing pulsed lidar systems so as to generate a high-density point cloud.”
Id. at 12.
1. Whether We Improperly Read Features of the Preferred
Embodiment Into the Claims
In requesting rehearing, Quanergy argues that we “overlooked” the
’558 patent’s “express definition of ‘lidar’ as a ‘laser imaging detection and
ranging’ system, which is broader than the Board’s construction.” Reh’g
Req. 9 (citing Ex. 1001, 3:65–67). It is undisputed that “lidar” is short-hand
for “laser imaging detection and ranging.” See Ex. 1002 (Quanergy’s
expert) ¶¶ 34, 100. But merely re-stating what the “lidar” acronym stands
for does little to define the “lidar” term in the context of the “3-D point
cloud system” language of the preamble.4 For that, the claim language must
be read in light of the entire specification. Indeed, it is axiomatic that the
specification is “the single best guide to the meaning of a disputed term.”
Phillips v. AWH Corp., 415 F.3d 1303, 1315 (Fed. Cir. 2005) (en banc)

4 As noted in our Final Decision, we agree with the District Court in the
related litigation that the preamble of claim 1 “is limiting because it
underscores the very essence of the invention . . . and is essential to
understanding how the recited components of claim 1 work together.” Final
Dec. 8 (citing Ex. 1027, 7–11, 32). According to the District Court,
“[r]eading claims 1 and 19 in the context of the entire ’558 patent, it is clear
that the inventor[] intended the claims to be limited to ‘LiDAR’ and ‘3-D
point cloud’ generation systems” given that the specification “summarizes
the advantages of the invention in ways which focus on LiDAR-based 3-D
point cloud generation. Ex. 1027 at 9 (citing Ex. 1001, 4:11–13, 6:37–41).
Quanergy does not dispute that the preamble is limiting. Pet. 8, 11.
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(quoting Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed.
Cir. 1996)).
Here, as explained in our Final Decision, the specification of the ’558
patent focuses exclusively on a pulsed ToF lidar system. Final Dec. 10–12.
More specifically, the specification begins by noting that prior art lidar
systems utilize “the basic concept . . . of pulsing a laser emitter” to generate
“a collection of pixels emitted and captured in rapid succession (called a
‘point cloud’),” but are “inherently limited to the number of pixels [they] can
generate due to the limitation of how many pulses per second are possible
from a single laser.” Ex. 1001, 1:10–31, 1:65–2:3 (emphases added). With
that in mind, the specification underscores the need “to maximize the
number of pixels to provide a point cloud that covers a broad field of view
yet is as dense as possible.” Id. at 2:6–9; see also id. at 2:31 (“It is always
desirable to collect more points faster.”).
Following on the theme of generating a 3-D point cloud from the
emission and detection of laser pulses, the specification highlights the
inventiveness of applying a “rotary component” to existing pulsed lidar
systems in order to “collect approximately 1 million time of flight (TOF)
distance points per second,” that rate “being necessary for autonomous
navigation.” Id. at 3:1–14, 3:65–4:14 (emphasis added). The collection of
ToF distance points corresponds to the number of pulses emitted and
reflected back from the laser. See id. at 8:52–54 (“the plurality of laser
emitters is configured to pulse at a rate of more than 1 million pulses per
second”); see also Ex. 1002 ¶ 39 (Quanergy’s expert pointing to the ’558
patent as an example of a LiDAR system that “can then convert the ‘time of
flight’ to a distance measurement.”).
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Elsewhere, the specification stresses the importance of controlling the
timing of pulses emitted and detected by the spinning lidar system. See, e.g.,
Ex. 1001, 5:11–15 (“Each of the emitter/detector pairs are controlled by one
or more DSPs, which determines when they will fire, determines the
intensity of the firing based on the previous return, records the time-of-flight,
calculates height data based [on] time-of-flight and angular alignment of
each pair.” (emphases added)); id. at 7:18–26 (“FIGS. 23A and B illustrate
circuits used for controlling the firing of a laser diode. . . . [T]he DSP sends
a charge/on signal to a FET 200, . . . , which in turn causes a laser 210 to
fire. The DSP turns off the FET 200 after a predetermined period of time as
previously determined by return intensity measurements from the last pulse.
The charging pulse is on for ~5 microseconds and the firing pulse is on for
~20 nanoseconds.” (emphasis added)).
In other words, the theme underlying the entire specification of the
’558 patent is the emission and collection of enough pulses of laser light to
generate sufficient 3-D point cloud data required for autonomous vehicle
navigation. As noted above and in our Final Decision, nowhere does the
specification describe or suggest anything but the use of pulsed ToF lidar to
derive the distance measurements necessary to generate the 3-D point cloud.
With such a consistent and exclusive focus on pulsed ToF lidar, the
specification makes clear that the inventor intended to limit the scope of the
claims to a pulsed ToF lidar system. See GPNE Corp. v. Apple Inc., 830
F.3d 1365, 1370 (Fed. Cir. 2016) (“[W]hen a patent ‘repeatedly and
consistently’ characterizes a claim term in a particular way, it is proper to
construe the claim term in accordance with that characterization.”). Thus,
given that clear indication in the intrinsic record of the inventor’s intent, we
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reject Quanergy’s argument that we improperly read limitations from a
preferred embodiment into the claims. See Reh’g Req. 9.
2. Whether Quanergy Had Notice and Opportunity to be Heard on
Our Final Adopted Construction
Also, contrary to Quanergy’s argument, we did not arrive at a
construction of “lidar” that was “inconsistent with the constructions
proposed and briefed by the parties.” Req. Reh’g 10. As discussed above,
we construed “lidar” as “pulsed time-of-flight (ToF) lidar.” Final Dec. 12.
That construction coincides identically with the one proposed by Velodyne
in its post-institution response. See, e.g., PO Resp. 2 (“the claims require
pulsed ToF lidar, which typically measured distances of tens or hundreds of
meters”); id. at 12 (“Thus, ‘3-D point cloud’ works with ‘lidar-based’ to
provide additional structural detail to the claims, requiring pulsed ToF lidar
along sequential directions in rapid succession—exactly what the ’558
patent describes.”); id. at 6 (“The ’558 Patent’s Improved ToF Pulsed Lidar
. . . System”). Likewise, in direct response to Quanergy’s reliance on the
“lidar” acronym in the specification, Velodyne again made clear that “the
cited passage and the rest of the patent discuss only pulsed ToF lidar,
consistent with lidar’s plain meaning.” PO Sur-Reply 4 (emphasis added).
Velodyne’s post-institution responses provided Quanergy with full
notice of the contested construction of “lidar.” Moreover, Quanergy had
opportunity to be heard on that construction. For instance, in its reply brief,
Quanergy took issue with Velodyne’s “attempts to limit ‘lidar’ to ToF,”
arguing that “[a]lthough ToF is used in embodiments, the claims are not
necessarily directed to that form of pulsed lidar, especially since the claims
are drafted so broadly.” Pet. Reply 5–6. And, during the oral hearing,
Quanergy’s counsel acknowledged that “it likely is necessary to address” the
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parties’ disputed construction of “lidar” in our final decision. Hr’g Tr. 15:9–
24. Quanergy’s counsel then framed the issue as follows:
We think that even under [patent owner’s] construction,
petitioner has shown that the claims are obvious based on – even
if somehow the claims are limited to what patent owner would
like to believe, which is that it’s a time-of-flight pulsed system . . .
[s]o even if it were limited to a pulsed time-of-flight system and
APDs, petitioner has shown why it would have been obvious to
use both of those.
Id. at 16:1–7 (emphasis added).
Our final adopted construction of “lidar” as “pulsed time-of-flight
(ToF) lidar” is no different than the construction proposed by Velodyne and
acknowledged by Quanergy in the course of this proceeding, as discussed
above. Thus, because Quanergy had notice of Velodyne’s proposed
construction and an opportunity to be heard, we reject the notion that our
adoption of Velodyne’s construction somehow constitutes a new theory in
violation of the Administrative Procedure Act. See Hamilton Beach Brands,
Inc. v. f’real Foods, LLC, 908 F.3d 1328, 1338–39 (Fed. Cir. 2018).
3. Whether We Overlooked an Express Disclaimer in the
Specification in Construing the Claims
Finally, Quanergy argues that, in construing the term “lidar,” we
“overlooked an express disclaimer in the ’558 patent.” Reh’g Req. 10
(citing Ex. 1001, 7:50–56). That supposed disclaimer states:
many changes can be made without departing from the spirit and
scope of the invention. Accordingly, the scope of the invention
is not limited by the disclosure of the preferred embodiment.
Instead, the invention should be determined entirely by reference
to the claims.

Ex. 1001, 7:50–56. The ’558 patent’s recitation of boilerplate language,
such as found here, neither controls nor alters our construction. Claims must
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always be read in light of the inventor’s entire disclosure, not simply a
paragraph alluding to undisclosed changes that the inventor might have
envisioned. See D Three Enterprises v. Sunmodo Corp., 890 F.3d 1042,
1051 (Fed. Cir. 2018) (“This boilerplate language at the end of the []
Application’s specification is not sufficient to show adequate disclosure of
the actual combination and attachments used in the [] Claims.”). That
bedrock principle—giving claims their broadest reasonable construction in
light of the entire specification in which they appear—clearly undercuts
Quanergy’s counter-intuitive argument of giving overriding weight to a
single boilerplate paragraph at the end of the specification. See Phillips v.
AWH Corp., 415 F.3d 1303, 1313 (Fed. Cir. 2005) (en banc); see also
United States v. Adams, 383 U.S. 39, 48–49 (1966) (“While the claims of a
patent limit the invention, and specifications cannot be utilized to expand the
patent monopoly, it is fundamental that claims are to be construed in the
light of the specifications and both are to be read with a view to ascertaining
the invention”) (citations omitted)). Thus, we could not have erred in
disregarding an argument that finds no support in the law.
D. Whether We Misapprehended or Overlooked Quanergy’s Expert
Testimony Concerning Mizuno’s System
Quanergy argues that we erred by misapprehending or overlooking
certain testimony of its expert when we found that Mizuno (Ex. 1058)5
neither discloses nor suggests the claimed “lidar” system. Reh’g Req. 12–13
(citing Final Dec. 17). According to Quanergy, we “mistakenly relied on
testimony from [its] expert that was specifically directed to Figure 5 of

5 At one point, our Final Decision mistakenly cites Mizuno as Exhibit 1004.
See Final Dec. 5 n.2. The correct cite for Mizuno is Exhibit 1058, as
indicated elsewhere in our Final Decision. See, e.g., id. at 14–15, 20, 23.
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Mizuno, which is one embodiment of Mizuno’s invention and is not
representative of Mizuno’s disclosure as a whole.” Id. (citing Ex. 2156,
167:23–168:1, 170:21–171:4, 200:2–203:12). We disagree.
At the outset, nowhere does Quanergy’s expert treat Mizuno’s
Figure 5 as being any different from Mizuno’s other figures, i.e., Figures
1–4. See Ex. 1002 ¶¶ 83–88. Nor could he, for Mizuno states expressly that
“Fig. 5 is a diagram for explaining the measurement principle when
measuring the outer peripheral shape through the device in Fig. 1.”
Ex. 1058, 5 (“Brief Description of the Drawings”). Indeed, Mizuno’s
figures are all directed to the same embodiment, depicting a “view” or
“diagram” of the device shown in Figure 1. Id. Knowing this, Quanergy’s
expert likewise speaks of Mizuno’s Figures 1–5 as showing the same
“peripheral shape measurement device” in which “laser measurement
devices 40 use a light-reflection-based measurement technique.” Ex. 1002
¶¶ 84–88. Thus, we are not persuaded by Quanergy’s belated attempt to
draw an arbitrary distinction in the testimony of its expert when it comes to
Mizuno’s Figure 5 vis-a-vis Mizuno’s disclosure as a whole.
In our Final Decision, we found that Quanergy’s own expert provided
clear and unequivocal evidence of Mizuno’s failure to disclose the use of
pulsed ToF lidar system as required by claim 1. Final Dec. 16–17 (citing
Ex. 2156, 166:14–167:4, 168:11–169:1, 178:4–9). For instance, under
cross-examination, Quanergy’s expert conceded that Mizuno is directed to
“a specular reflection system as opposed to . . . a time-of-flight LiDAR
system. This is a system whereby you’re simply looking at the specular
reflected light off of an object and you are looking at where it hits.”
Ex. 2156, 166:14–167:4 (emphasis added). Similarly, Quanergy’s expert
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repeated that Mizuno “is a very simplistic system here, whereby the light
reflects specular, . . . if you shine a light in to a shiny object or a mirror, it
will reflect off of it and hit another location. And so you can track that,
where it actually hits. And so this is opposed to what one would call
perhaps a time-of-flight system.” Id. at 168:11–169:1 (emphasis added). In
our view, that testimony by Quanergy’s expert clearly supported our finding
that Mizuno’s specular-reflection system is different from a pulsed ToF
system and consequently fails to meet the claimed “lidar” limitation. Final
Dec. 17.
In an effort to minimize the damaging impact of that cross-
examination testimony from its expert, Quanergy now points to testimony on
re-direct in which its expert testified as to methods “Mizuno could use” for
measuring distance. Reh’g Req. 13 (citing Ex. 2156, 200:2–203:12).
However, the full line of Quanergy’s questioning on re-direct exposes the
weakness of Quanergy’s argument:
Q. [by Quanergy’s counsel] Counsel for [Velodyne] had asked
you to identify categories of LiDAR systems. Do you recall that?

A. [by Quanergy’s expert] Yes, I believe so. . . .

Q. And could Mizuno’s system . . . could Mizuno’s system use
any of those categories of LiDAR systems?

[Objection from Velodyne’s counsel]

THE WITNESS: Mizuno – let me go through each one. Mizuno
could use AM radar. Mizuno could use FM – LiDAR, I should
say light radar. Mizuno could use a time-of-flight pulsed LiDAR
system. Mizuno could use a triangulation system. Mizuno could
use an interferometric system.

Ex. 2156, 199:18–200:14 (emphases added). Under further questioning,
Quanergy’s expert testified that Mizuno could use other methods as well:
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Q. And did counsel for Velodyne ask you what you relied on in
your opinion during direct that Mizuno could use any of those
five categories of LiDAR systems?

A. He may have. This -- what is described here in [Mizuno] is a
LiDAR system in my opinion, a light radar system which could
be any of the methods that I mentioned, as well as perhaps others
as well.

Id. at 201:22–203:12 (emphasis added).
That re-direct testimony by Quanergy’s expert does not amount to
persuasive evidence of what a skilled artisan would have understood from
Mizuno’s disclosure. In an obviousness inquiry, “[t]he mere fact that a
certain thing may result from a given set of circumstances is not sufficient.”
In re Oelrich, 666 F.2d 578, 581 (CCPA 1981) (citations omitted). More
aptly, rather than focus on whether a skilled artisan could modify the relevant
art, the obviousness inquiry focuses on whether the skilled artisan would
have been led to modify the relevant art. See Personal Web Techs., LLC v.
Apple, Inc., 848 F.3d 987, 993–94 (Fed. Cir. 2017); see also Belden Inc. v.
Berk-Tek LLC, 805 F.3d 1064, 1073 (Fed. Cir. 2015) (“[O]bviousness
concerns whether a skilled artisan not only could have made but would have
been motivated to make the combinations or modifications of prior art to
arrive at the claimed invention.”); InTouch Technologies, Inc. v. VGO
Commc’ns, Inc., 751 F.3d 1327, 1352 (Fed. Cir. 2014) (finding that accused
infringer’s expert “succumbed to hindsight bias in her obviousness analysis”
where the expert’s “testimony primarily consisted of conclusory references
to her belief that one of ordinary skill in the art could combine these
references, not that they would have been motivated to do so”).
Like those cases, the testimony of Quanergy’s expert is wanting and
lacking basis in the law. The mere belief of Quanergy’s expert that a skilled
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artisan could use pulsed ToF lidar with Mizuno’s system is not enough by
itself to justify a finding that a skilled artisan would have done so with a
reasonable expectation of success. In the end, the testimony of Quanergy’s
expert on re-direct was incomplete, unspecific, and ultimately conclusory.
Such testimony does not qualify as persuasive evidence of obviousness. As
such, we accorded it little weight. Indeed, “crediting such testimony risks
allowing the challenger to use the challenged patent as a roadmap to
reconstruct the claimed invention using disparate elements from the prior
art—i.e., the impermissible ex post reasoning and hindsight bias that KSR
warned against.” TQ Delta, LLC v. Cisco Sys., Inc., 942 F.3d 1352, 1361
(Fed. Cir. 2019). For these reasons, Quanergy does not persuade us that we
misapprehended or overlooked any aspect of its expert’s testimony when we
found that Mizuno lacks disclosure or suggestion of a pulsed ToF lidar
system.
E. Whether We Erred in Finding Quanergy Failed to Show a Reasonable
Expectation of Success of Using Pulsed ToF Lidar in Mizuno’s System
Similarly, Quanergy argues that we erred in finding that a skilled
artisan would not have had a reasonable expectation of success in using a
pulsed ToF lidar in Mizuno’s system. Reh’g Req. 13–15. According to
Quanergy, our finding “was based entirely on the Berkovic reference” to the
exclusion of supposedly “more compelling evidence . . . that there were
actual commercial products available on the market by 2006 that used
pulsed TOF to measure distances as close as three (3) inches.” Id. at 13
(citing Pet. Reply 11–12; Exs. 1073, 1082, 2050). Had we reviewed that
evidence, Quanergy asserts, we would have found “a reasonable expectation
of success in using a pulsed ToF system in Mizuno because these products
actually achieved close range measurements.” Id. at 13–14. We disagree.
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At the outset, we note that Quanergy’s primary evidence for showing
“it was well known” to use pulsed ToF lidar for measuring short-range
distances centered on the prior art references of Kilpela (Ex. 1005) and
Berkovic (Ex. 2007). See Pet. 17, 22, 32 (citing Ex. 1005); Pet. Reply 11–18
(citing Exs. 1005, 2007). We discussed both of those references at length in
our Final Decision. See Final Dec. 17–28. As for Quanergy’s supposedly
more compelling evidence in Exhibits 1073, 1082, and 2050, we did not
overlook it, but rather gave it little weight for reasons that Quanergy clearly
should have comprehended. For instance, rather than showing “actual
commercial products available on the market by 2006,” as Quanergy
suggests (Reh’g Req. 13), Exhibit 2050 is a User’s Manual depicting an
embodiment of the claimed invention after 2006. See Ex. 2050, 1, 4, 5.
Because Exhibit 2050 is not indicative of the state-of the art “by 2006,” we
gave it no weight.
Quanergy’s reliance on Exhibits 1073 and 1082 as evidence of
“products . . . on the market by 2006 that used pulsed ToF to measure
distances” is equally unavailing. Reh’g Req. 13; see also Pet. Reply 12
(“sensors from 2004 using pulsed ToF techniques”). Exhibit 1073 is a
catalogue depicting “DME 2000/DME 3000” scanning sensors from the
2004 time frame. Exhibit 1082 depicts the same, i.e., a “DME 2000” sensor.
But neither of these exhibits supports Quanergy’s assertion of showing
products “that used pulsed TOF to measure distances.” Reh’g Req. 13
(emphasis added). Importantly, upon being asked “[d]o you know if it’s
pulsed time-of-flight” being used by the DME 2000/3000 sensors of
Exhibit 1073, Quanergy’s own expert conceded, “[w]ell, with just this
information, I’m not sure.” Ex. 2194, 187:15–188:14. That testimony left
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us with little regard for Quanergy’s attempt to show the relevant art through
Exhibits 1073 and 1082.
F. Whether We Overlooked Quanergy’s Expert Testimony Regarding
Modification of Mizuno’s System as Taught by Kilpela
Quanergy argues we overlooked its expert’s testimony of “how a
[skilled artisan] would modify Mizuno’s system to achieve close range
measurements” and “why Mizuno’s system would not suffer from the
shortcomings identified in Kilpela.” Reh’g Req. 14 (citing Ex. 1063
¶¶ 56–59; Final Dec. 22). In our Final Decision, we noted how Berkovic
(a reference offered by Quanergy to show the state-of-the-art) explains that
a pulsed ToF sensor would encounter degradation problems when operating
“[a]t distances shorter than tens of meters,” such as Mizuno’s device. Final
Dec. 18, 22, 27 (citing Ex. 2007, 10; Ex. 2115 ¶ 37). Significantly, we
highlighted that “[n]owhere does Quanergy’s expert account for those
problems, despite Quanergy’s reliance on Berkovic as state-of-the-art.” Id.
at 22 (citing Ex. 1063 ¶¶ 28–34, 55–59).
Moreover, in opining that a skilled artisan would understand that the
Mizuno system “could be modified,” or “could be designed,” or “could be
calibrated” to account for these known problems in implementing Kilpela’s
teachings, Quanergy’s expert fails to address how a skilled artisan would
have done so with a reasonable expectation of success. See Ex. 1002
¶¶ 57–58. As discussed above, the relevant inquiry is not whether a skilled
artisan could modify the prior art, but whether the skilled artisan would have
been motivated to do so. See Personal Web Techs., 848 F.3d at 993–94;
Belden, 805 F.3d at 1073; InTouch Techs., 751 F.3d at 1352. Thus, we gave
little weight to the testimony of Quanergy’s expert, especially in the face of
the more persuasive testimony of Velodyne’s expert that, like Berkovic,
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Kilpela’s pulsed ToF lidar exhibits inaccuracy and imprecision at close-
range distances. See Final Dec. 24–27 (citing Ex. 2115 ¶¶ 119, 143, 151,
152).
Lastly, Quanergy summarily lists four arguments from its Reply that
we purportedly overlooked in finding that Quanergy failed to show a skilled
artisan would have had a reasonable expectation of success in modifying
Mizuno’s device in accordance with Kilpela’s teachings. Reh’g Req. 14–15
(citing Reply 9–11, 12–14). In our Final Decision, we explained in great
detail why Quanergy had not carried its burden of showing a reasonable
expectation of success with respect to the asserted modification. See Final
Dec. 17, 23–28. We neither overlooked nor misapprehended any of
Quanergy’s arguments in this regard, which are merely repeated in its
rehearing request without further explanation. See Reh’g Req. 14–15. Nor
do we find those arguments any more persuasive now than we did then. In
the end, we are unpersuaded of any error in our ultimate determination that
Quanergy failed to carry its burden of showing that a skilled artisan would
have had a reasonable expectation of success of using a pulsed ToF lidar
technique in Mizuno’s device.
IV. CONCLUSION
For the foregoing reasons, Quanergy’s Request for Rehearing is
denied.

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FOR PETITIONER:

Erik B. Milch
Christopher C. Campbell
Jennifer Volk Fortier
COOLEY LLP
emilch@cooley.com
ccampbell@cooley.com
jvolkfortier@cooley.com

FOR PATENT OWNER:

Jonathan M. Strang
Ann Marie Wahls
Priyen Patel
LATHAM & WATKINS LLP
jonathan.strang@lw.com
annmarie.wahls@lw.com
priyen.patel@lw.com