Volkswagen Group of America, Inc.v.Velocity Patent LLC

Patent Trial and Appeal Board

Jun 1, 2015

08813270 (P.T.A.B. Jun. 1, 2015)

Trials@uspto.gov Paper No. 8
571-272-7822 Entered: June 1, 2015

UNITED STATES PATENT AND TRADEMARK OFFICE
____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
____________

VOLKSWAGEN GROUP OF AMERICA, INC.,
Petitioner,

v.

VELOCITY PATENT LLC,
Patent Owner.
____________

Case IPR2015-00276
Patent 5,954,781
____________

Before GLENN J. PERRY, RAMA G. ELLURU, and PETER P. CHEN,
Administrative Patent Judges.

CHEN, Administrative Patent Judge.

DECISION
Denying Institution of Inter Partes Review
37 C.F.R. § 42.108
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I. INTRODUCTION

Volkswagen Group of America, Inc. (“Petitioner”) filed a Petition
requesting an inter partes review of claims 1, 2, 4, 5, 7, 8, 10, 12, 13, 15, and
17–32 of U.S. Patent No. 5,954,781 (Ex. 1001, “the ’781 patent”). Paper 2
(“Pet.”). Velocity Patent LLC (“Patent Owner”) filed a Preliminary
Response. Paper 6 (“Prelim. Resp.”). We have statutory authority under
35 U.S.C. § 314, which provides that an inter partes review may not be
instituted “unless . . . there is a reasonable likelihood that the petitioner
would prevail with respect to at least 1 of the claims challenged in the
petition.”
Upon consideration of the Petition, we are not persuaded Petitioner
has demonstrated a reasonable likelihood that it would prevail in showing
the unpatentability of any of the challenged claims of the ’781 patent.
Accordingly, we do not institute an inter partes review of the ’781 patent.
A. Related Proceedings
Patent Owner filed a Complaint against a subsidiary of Petitioner, and
a company under whose name Petitioner does business, in the U.S. District
Court for the Northern District of Illinois, alleging infringement of the ’781
patent. Velocity Patent LLC v. Audi of America, Inc., Case No. 1:13-cv-
08418-JWD (N.D. Ill.). Pet. 1. Patent Owner has filed other lawsuits in the
Northern District of Illinois alleging infringement of the ’781 patent by other
parties. Pet. 5–6; Paper 5, 1. On May 22, 2014, Petitioner filed a request for
ex parte reexamination of the ’781 patent, which is pending as Control No.
90/013,252 (the “Reexamination”). Id.

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B. The ’781 Patent
The ’781 patent is titled, “Method and Apparatus for Optimizing
Vehicle Operation.” The subject matter of the challenged claims of the ’781
patent relates generally to a system which notifies the driver of
recommended corrections in vehicle operation and, under certain conditions,
automatically initiates corrective action. Ex. 1001, 1:5–10. Figure 1 of the
’781 patent is reproduced below.

Figure 1 is a block diagram of the ’781 system. Ex. 1001, 5:42–44. System
10 includes processor subsystem 12 (“for example, a microprocessor”), and
memory subsystem 14 connected by bus 16 to processor subsystem 12. Id.
at 5:54–58. State sensors and level sensors, including road speed sensor 18,
rpm sensor 20, manifold pressure sensor 22, throttle sensor 24, windshield
wiper sensor 30, and brake sensor 32, collectively monitor the operation of
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the vehicle and are coupled to processor subsystem 12. Id. at 2:12–16, 5:65–
6:7. System 10 also includes upshift notification circuit 34, downshift
notification circuit 36, overinjection notification circuit 38, and vehicle
proximity alarm circuit 40, coupled to processor subsystem 12, all of which
may be configured to provide visual or audible notifications to the driver of
the vehicle. Id. at 7:9–25.
Processor subsystem 12 periodically polls and receives data from the
series of sensors to determine when to activate the fuel overinjection
notification circuit or other notification circuits, and issue notifications. Id.
at Abstract, 2:17–20, 5:65–6:7, 6:42–46, 12:64–13:20. See Pet. 2–5; Prelim.
Resp. 4–10. The ’781 patent also describes automatic initiation of corrective
action, for example throttle reduction by throttle controller 26, if the vehicle
is operated unsafely. Ex. 1001, Abstract, 4:3–11, 7:5–6, 7:49–53, 10:15–29.
C. Illustrative Claim
Claims 1, 2, 4, 5, 7, 8, 10, 12, 13, 15, and 17–32 are the subject of the
petition. Claims 1, 7, 13, 17, 23, 26, 28, and 31 are independent.
Independent claim 1 is illustrative of the challenged claims and is
reproduced as follows.
1. Apparatus for optimizing operation of a vehicle, comprising:

a plurality of sensors coupled to a vehicle having an engine,
said plurality of sensors, which collectively monitor operation
of said vehicle, including a road speed sensor, an engine speed
sensor, a manifold pressure sensor and a throttle position
sensor;

a processor subsystem, coupled to each one of said plurality of
sensors, to receive data therefrom;

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a memory subsystem, coupled to said processor subsystem, said
memory subsystem storing therein a manifold pressure set
point, an RPM set point, and present and prior levels for each
one of said plurality of sensors;

a fuel overinjection notification circuit coupled to said
processor subsystem, said fuel overinjection notification circuit
issuing a notification that excessive fuel is being supplied to
said engine of said vehicle;

an upshift notification circuit coupled to said processor
subsystem, said upshift notification circuit issuing a notification
that said engine of said vehicle is being operated at an excessive
speed;

said processor subsystem determining, based upon data
received from said plurality of sensors, when to activate said
fuel overinjection circuit and when to activate said upshift
notification circuit.

D. Prior Art Relied Upon
Petitioner relies upon the following five references.

Reference Title Date Ex. No.
Jurgen Automotive Electronics Handbook 1995 Ex. 1002
Smith U.S. Patent No. 4,398,174 Issued Aug. 9,
1983
Ex. 1003
Habu U.S. Patent No. 4,559,599 Issued Dec. 17,
1985
Ex. 1004
Davidian U.S. Patent No. 5,357,438 Issued Oct. 18,
1994
Ex. 1005
Tonkin PCT No. WO 96/02853 Published Feb.
1, 1996
Ex. 1006

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E. The Asserted Grounds
Petitioner contends the challenged claims are unpatentable based on
the following four grounds.
Reference(s) Basis Claims Challenged
Jurgen, Smith, and Habu § 103 1, 2, 4, 5, 7, 8, 10, 12, 13, 15,
and 28–30
Jurgen, Smith, Habu, and
Davidian
§ 103 17–27
Davidian § 102 31
Davidian and Tonkin § 103 32

II. ANALYSIS
A. Claim Construction
In an inter partes review, claim terms in an unexpired patent are
interpreted according to their broadest reasonable construction in light of the
specification of the patent in which they appear. See 37 C.F.R. § 42.100(b);
Office Patent Trial Practice Guide, 77 Fed. Reg. 48,756, 48,766 (Aug. 14,
2012). See In re Cuozzo Speed Techs., 778 F.3d 1271, 1282 (Fed. Cir. 2015)
(holding that broadest reasonable interpretation standard “was properly
adopted by PTO regulation” for IPR proceedings). Claim terms generally
are given their ordinary and customary meaning, as would be understood by
one of ordinary skill in the art in the context of the entire disclosure. See In
re Translogic Tech., Inc., 504 F.3d 1249, 1257 (Fed. Cir. 2007).
Petitioner proposes a construction for a single term, “fuel
overinjection notification circuit,” stating that the term means a circuit that
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“provides the driver with . . . an alert that his or her driving is fuel
inefficient.” Pet. 8. Patent Owner proposes that this term means “a circuit
that provides a driver with a notification that his or her driving is fuel
efficient or inefficient.” Prelim. Resp. 11.
The independent claims of the ’781 patent recite that the fuel
overinjection notification circuit is “coupled to said processor subsystem,
said fuel overinjection notification circuit issuing a notification that
excessive fuel is being supplied to said engine of said vehicle.” See, e.g.,
Ex. 1001, 14:1–4. This description of the fuel overinjection notification
circuit also appears in part throughout the specification, see, e.g., id. at
Abstract, 2:15–19, 3:10–15, 4:15-18, 7:18–19. We cannot discern how the
constructions proffered by Petitioner or Patent Owner add any clarity to the
term, the meaning of which is discernible from the context of the claims and
specification. Therefore, for purposes of this Decision, we conclude that no
explicit construction is necessary for this term. We also determine that no
explicit construction is necessary for the other terms proposed by Patent
Owner.
B. 35 U.S.C. § 325(d)

Patent Owner argues that we should exercise our discretion to deny
review of the challenged claims pursuant to 35 U.S.C. § 325(d). Prelim.
Resp. 13–18. Section 325(d) provides that in “determining whether to
institute or order a proceeding under this chapter, chapter 30, or chapter 31,
the Director may take into account whether, and reject the petition or request
because, the same or substantially the same prior art or arguments previously
were presented to the Office.” Patent Owner argues that the Petition should
be denied under § 325(d) because “Petitioner discloses substantially the
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same references presented in Reexamination,” and “Petitioner presents
substantially similar arguments as it did in Reexamination.” Prelim. Resp.
15–16. We decline to exercise our discretion to reject the Petition under
§ 325(d) because the prior art and arguments presented by Petitioner are not
substantially similar to those presented in the pending Reexamination.
In particular, Petitioner argues that the Smith reference, asserted here
but not in the Reexamination, teaches one or more limitations of twenty-four
of the twenty-six challenged claims. Pet. 9–54. Smith discloses a fuel
consumption signaling system including “an alarm circuit connected in
series with an indicator circuit including an indicator light connected in
parallel with a vacuum operated switch pneumatically connected to the
engine manifold.” Ex. 1003, Abstract. Although Smith was listed by Patent
Owner in an Information Disclosure Statement filed in the Reexamination, it
was not argued by Petitioner in the Reexamination, or substantively
addressed or even cited by the Examiner. Indeed, Patent Owner concedes
“the Examiner noted that ‘it should be assumed that only the most cursory
review of the cited documents consistent with [MPEP] guidelines has been
performed.’ (Ex. 1011 at 25.)” Prelim. Resp. 15–16 and n. 8. Because
Smith was not meaningfully considered in the Reexamination, we do not
exercise our discretion to deny review under § 325(d).

C. Claims 1, 2, 4, 5, 7, 8, 10, 12, 13, 15, and 28–30: Asserted
Obviousness over Jurgen, Smith, and Habu

Petitioner contends claims 1, 2, 4, 5, 7, 8, 10, 12, 13, 15, and 28–30
are unpatentable under 35 U.S.C. § 103(a) as obvious over Jurgen, Smith,
and Habu. Pet. 9–33. Claims 1, 7, 13, and 28 are independent. Claims 2, 4,
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and 5 depend from claim 1, claims 8, 10, and 12 depend from claim 7, claim
15 depends from claim 13, and claims 29 and 30 depend from claim 28.
Jurgen (Exhibit 1002)
Jurgen, titled “Automotive Electronics Handbook,” is a compilation of
chapters by various authors describing implementations of electronic
components in vehicles. Prelim. Resp. 30; Ex. 1002, vii–xvi. Petitioner
cites to chapters of Jurgen describing sensors, automotive microcontrollers,
engine control, transmission control, cruise control, and on-board and off-
board diagnostics. Pet. 12–51; Ex. 1002, vii–xvi.
Habu (Ex. 1004)
Habu, titled “Optimum Shift Position Indication Using Successive
Two-Dimensional Data Maps,” describes a shift indication apparatus for
indicating shift position in vehicles equipped with manual transmission, in
order to maintain optimum fuel consumption. Ex. 1004, Abstract, 1:33–39.
Habu discloses an apparatus with sensors for engine rotation, throttle valve,
and shift position, a microcomputer with memory for storing engine speed
data, and an indicator for indicating preferable shift positions for a driver,
“so as to enable the economical running of the car to be realized.” Id.,
Abstract, Fig. 1, 2:23–36.
Smith (Ex. 1003)
Smith, titled “Fuel Consumption Signalling System,” describes a
system for signaling both efficient and inefficient fuel consumption
conditions, using an alarm circuit connected in series with an indicator
circuit. Ex. 1003, Abstract, Fig. 1, 2:32–36, 3:58–60. If the engine of a
vehicle operates inefficiently (“a fuel wasteful fashion”), the alarm circuit
illuminates an alarm light and also activates an audio alarm if the inefficient
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fuel consumption condition lasts beyond a preset amount of time. Id. at
2:49–58, 5:23–27.
Analysis
Petitioner contends that the combination of Jurgen, Smith, and Habu
teaches or suggests the limitations of claims 1, 2, 4, 5, 7, 8, 10, 12, 13, 15,
and 28–30. Pet. 9–33.
Patent Owner argues that Petitioner does not attempt to “explain why
an ordinary artisan would modify Smith to incorporate processor control into
Smith’s system,” Prelim. Resp. 48, and argues further that one of ordinary
skill in the art would not combine Jurgen, Smith, and Habu, id. at 32–41.
An invention “composed of several elements is not proved obvious merely
by demonstrating that each of its elements was, independently, known in the
prior art.” KSR Int’l Co. v. Teleflex, Inc., 550 U.S. 398, 418 (2007). For
example, for the limitation of independent claims 1, 7, 13, and 28, reciting
“a fuel overinjection notification circuit coupled to said processor
subsystem,” Petitioner cites Smith’s disclosure of “an alarm circuit
connected in series with an indicator circuit including an indicator light
connected in parallel with a vacuum operated switch pneumatically
connected to the engine manifold,” where the alarm circuit “is not actuated
until the engine is operated in a fuel wasteful fashion.” Pet. 9–10, 16–17;
Ex. 1003, Abstract, 5:23–27. Smith does not teach or suggest a “processor
subsystem” (which the ’781 patent describes as “for example, a
microprocessor,” Ex. 1001, 5:54–55), or any digital components, but
Petitioner contends that Jurgen discloses a microcontroller, and Habu
discloses a microcomputer. Pet. 10, 13–14; Ex. 1002, 12.1, 22.6, 14.3; Ex.
1004, Fig. 1, 2:33–42.
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A determination of unpatentability on a ground of obviousness,
however, must also include “‘articulated reasoning with some rational
underpinning to support the legal conclusion of obviousness.’” KSR, 550
U.S. at 418 (quoting In re Kahn, 441 F.3d 977, 988 (Fed. Cir. 2006)). The
obviousness evaluation “should be made explicit,” and it “can be important
to identify a reason that would have prompted a person of ordinary skill in
the relevant field to combine the elements in the way the claimed new
invention does.” Id. Petitioner, which did not supply expert testimony to
support its assertions, attempts through argument of counsel to provide a
rationale for combining Jurgen, Smith, and Habu, citing to some excerpts
from Jurgen, Smith, and Habu. Pet. 11–12. Petitioner argues these excerpts
state motivations to combine, as follows:
[T]o provide the needed accuracy and adaptability in order to
minimize exhaust emissions and fuel consumption, provide
optimal driveability for all operating conditions, minimize
evaporative emissions, and provide system diagnosis when
malfunctions occur.

Pet. 11 (quoting Ex. 1002, 12.1).

[T]o “provide optimal driveability for all operating conditions.”

Pet. 11 (quoting Ex. 1002, 12.1).

[T]o “provide[] the fuel metering and ignition timing precision
to minimize fuel consumption.[”]

Pet. 11 (quoting Ex. 1002, 12.4).

[T]o encourage “fuel efficient driving techniques.”

Pet. 11 (quoting Ex. 1003, 1:22–24).

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[T]o “obtain preferable shift positions relating to optimum fuel
consumption rate in accordance with . . . data detected.”

Pet. 11 (quoting Ex. 1004, Abstract). Citing to the Board’s decision in Cisco
Systems, Inc. v. Constellation Techs. LLC, Case IPR2014-01179 (PTAB
Feb. 4, 2015) (Paper 7) (“Cisco”), Patent Owner contends that “[r]ote
recitation of some of the respective goals of Jurgen, Smith and Habu does
not explain a motivation to combine them to create the inventions of the
’781 Patent.” Prelim. Resp. 35. Patent Owner further contends:
Petitioner does not explain how any of the listed
motivation(s) would individually or collectively lead to a
combination teaching the challenged ’781 Patent’s inventions.
Instead, Petitioner summarily states: “like the ’781 [P]atent,
Jurgen, Smith, and Habu are concerned with, for example,
improving fuel efficiency.” (Pet. at 12.) This “fails to explain
why a person of ordinary skill in the art would have combined
elements from specific references in the way the claimed
invention does.” Cisco, IPR2014-01179, Paper 7 at 16 (quoting
ActiveVideo Networks, Inc. v. Verizon Commc’ns, Inc., 694
F.3d 1312 (Fed. Cir. 2012) (emphasis in original)).

Prelim. Resp. 36 (footnote omitted). Patent Owner adds:

It is the norm for a patent or other literature to note that it
is directed to improving some issue in an art. Typically, there
are many patents directed at improving on that same issue. It
does not necessarily follow, as Petitioner suggests, that one of
skill in the art would combine each prior art reference
containing boilerplate statements concerning a desire to
improve on a particular technical issue. See Innogenetics, N.V.
v. Abbott Labs., 512 F.3d 1363, 1373 (Fed. Cir. 2008)
(“[K]nowledge of a problem and motivation to solve it are
entirely different from motivation to combine particular
references to reach the particular claimed method.”).

Prelim. Resp. 36–37.
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We agree with Patent Owner that Petitioner’s rationale for combining
Jurgen, Smith, and Habu is premised on a handful of conclusory assertions
by counsel, unsupported by testimony of an expert witness. Rather than
articulated reasoning with rational underpinnings as to why one of ordinary
skill in the art would have looked to Smith’s indicator light connected in
parallel with a vacuum operated switch pneumatically connected to the
engine manifold, in considering how to implement a fuel overinjection
notification circuit coupled to a processor subsystem, Petitioner has provided
only a few sentences of conclusory contentions. Absent from Petitioner’s
argument is any explanation of how the teachings of Jurgen, Smith, and
Habu might be combined to arrive at the claimed invention, e.g., by
combining and applying specific teachings of Smith with Jurgen and Habu
to account for all the features of the challenged claims. See KSR, 550 U.S. at
418.
Petitioner’s quoted snippets from Jurgen, Smith, and Habu about
improving fuel efficiency are generic and bear no relation to any specific
combination of prior art elements. Specifically, Petitioner “fails to explain
why a person of ordinary skill in the art would have combined elements
from specific references in the way the claimed invention does.”
ActiveVideo Networks, Inc. v. Verizon Commc’ns, Inc., 694 F.3d 1312, 1328
(Fed. Cir. 2012). Thus, we are not persuaded that the Petition demonstrates
a reasonable likelihood that Petitioner would prevail in establishing
unpatentability of independent claims 1, 7, 13, and 28, and of dependent
claims 2, 4, 5, 8, 10, 12, 15, 29, and 30.

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D. Claims 17–27: Asserted Obviousness over Jurgen, Smith, Habu, and
Davidian

Claims 17–27 “are similar to the above claims,” Pet. 33, but recite
additional limitations of a radar sensor and vehicle proximity alarm, which
Petitioner asserts are taught by Davidian. Pet. 33; Ex. 1001, 17:34–20:37.
Claims 17, 23, and 26 are independent, and claims 18–22 depend from claim
17, claims 24 and 25 depend from claim 23, and claim 27 depends from
claim 26. For a rationale to combine Jurgen, Smith, Habu, and Davidian,
Petitioner reiterates the same excerpts cited for claims 1, 2, 4, 5, 7, 8, 10, 12,
13, 15, and 28–30, and cites an excerpt from Davidian for adding an anti-
collision system for vehicles. Pet. 34. We determine that, as explained
above, Petitioner fails to provide articulated reasoning with rational
underpinning for combining Jurgen, Smith, Habu, and Davidian. See KSR,
550 U.S. at 418. We, therefore, are not persuaded that the Petition
demonstrates a reasonable likelihood that Petitioner would prevail in
establishing unpatentability of independent claims 17, 23, and 26, and of
dependent claims 18–22, 24, 25, and 27.
E. Dependent claims 2, 4, 5, 8, 10, 12, 15, 21, 24, 25, and 27
Petitioner has not proposed constructions for any of the means-plus-
function limitations recited in dependent claims 2, 4, 5, 8, 10, 12, 15, 21, 24,
25, and 27. We determine that Petitioner has not met its burden to
demonstrate a reasonable likelihood that the challenged dependent claims
are unpatentable because it has not provided constructions for the means-
plus-function limitations. See 37 C.F.R. § 42.104(b)(3) (“[w]here the claim
to be construed contains a means-plus-function or step-plus-function
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limitation as permitted under 35 U.S.C. § 112(f), the construction of the
claim must identify the specific portions of the specification that describe the
structure, material, or acts corresponding to each claimed function”).
Without a proper claim construction of the means-plus-function limitations,
we cannot discern the scope of these dependent claims in order to determine
whether they are unpatentable over the asserted references. We decline to
construe the means-plus-function limitations ab initio where Petitioner has
not provided argument as to the scope of these claims.
For example, dependent claim 2 recites “means for determining when
road speed for said vehicle is increasing,” “means for determining when
throttle position for said vehicle is increasing,” and “means for comparing
manifold pressure to said manifold pressure set point.” Ex. 1001, 14:16–21.
We decline to speculate on the specific disclosure in the ’781 patent
describing structure corresponding to the means-plus-function limitations
recited in claim 2 and in the other dependent claims with means-plus-
function limitations.
Moreover, because Petitioner has failed to identify sufficient structure
for a claim construction of the means-plus-function limitations, Petitioner
necessarily also has failed to specify where such structure is found in Jurgen,
Smith, Habu, and Davidian, pursuant to 37 C.F.R. § 42.104(b)(4).
Accordingly, for these reasons we decline to institute trial on dependent
claims 2, 4, 5, 8, 10, 12, 15, 21, 24, 25, and 27, in addition to the bases
described above in II.C. and II.D.

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F. Claims 31 and 32: Asserted Anticipation by Davidian (claim 31) and
Obviousness over Davidian and Tonkin (claim 32)

We also decline to institute a trial on independent claim 31 and
dependent claim 32, which were disclaimed by Patent Owner in the
Reexamination and cancelled by the Board in another inter partes review
proceeding involving the ’781 Patent, Mercedes-Benz USA LLC and
Mercedes-Benz U.S. International, Inc. v. Velocity Patent LLC, Case
IPR2014-01247 (PTAB). In particular, in the Reexamination, Patent Owner
recorded a statutory disclaimer of claims 31 and 32. See Mercedes-Benz
USA LLC and Mercedes-Benz U.S. International, Inc. v. Velocity Patent
LLC, Ex. 2001. Pursuant to Patent Owner’s request for adverse judgment,
id. Paper 19, the Board granted Patent Owner’s request to cancel claims 31
and 32. Id., Paper 20. As a result, Petitioner’s challenges to these two
cancelled claims are moot. See Prelim. Resp. 60.
III. CONCLUSION
For the foregoing reasons, we are not persuaded the information
presented in the Petition establishes a reasonable likelihood that Petitioner
would prevail in establishing unpatentability of claims 1, 2, 4, 5, 7, 8, 10, 12,
13, 15, and 28–30 as obvious over Jurgen, Smith, and Habu, of claims 17–27
as obvious over Jurgen, Smith, Habu, and Davidian, of claim 31 as
anticipated by Davidian, and of claim 32 as obvious over Davidian and
Tonkin.
IV. ORDER
Accordingly, it is
ORDERED that the Petition is denied and no trial is instituted.
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PETITIONER:

Michael J. Lennon
Clifford A. Ulrich
Kenyon & Kenyon LLP
mlennon@kenyon.com
culrich@kenyon.com

PATENT OWNER:

Brian C. Kwok
Mavrakakis Law Group LLP
bkwok@mavllp.com

Patrick Richards
Richards Patent Law P.C.
patrick@richardspatentlaw.com