Case ClIPs

In an attempt to invalidate U.S. Patent No. 10,225,588, Netflix, Inc. (“Netflix”) filed an Inter Partes Review (“IPR”) of claims 1-24 of the ‘588 Patent owned DivX LLC (“Patent Owner”). On August 26, 2020, the Patent Trial and Appeal Board (“PTAB”) instituted the IPR and subsequently issued a Final Written Decision that only addressed one of the three issues raised by the Patent Owner. On Appeal, the Federal Circuit vacated PTAB’s Final Decision and remanded with specific instructions to address the two other issues, one of which included determining the proper construction of a claim limitation reciting “locating encryption information that identifies encrypted portions of frames of video within the requested portions of the selected stream of protected video” (“the Limitation”), contained in claim 1. (M. Op., p. 3.)

On remand, the PTAB grappled with whether “within the requested portions of the selected stream of protected video” modified the first clause of the Limitation (i.e., “locating encryption information”) or the second clause (i.e., the video frames). (M. Op., p. 12.) Netflix argued for the latter which was how the PTAB preliminarily construed the Limitation at the institution stage of the IPR, and the Patent Owner argued that the last clause of the Limitation modified the first such that “the encryption information is located within the requested portions of the selected stream of protected video.” Id.

With the help of imaginary commas, the PTAB sided with the Patent Owner by a split decision. In construing the Limitation, the PTAB relied on expert testimony presented by the Patent Owner that claimed this construction of the Limitation is “the most natural reading of the claim … [because] the second clause of the claim limitation informs the person of ordinary skill in the art of the function of the ‘encrypted information,’ whereas the third clause informs where that encrypted information is located.” (M. Op., p. 13.) To further explicate this point, the PTAB inserted commas sue sponte into the Limitation such that it read “locating encryption information, that identifies encrypted portions of frames of video, within the requested portions of the selected stream of protected video.”[1] Id. Nevertheless, the PTAB acknowledged that Netflix’s proffered interpretation was “not unreasonable,” but made less sense in context of the entire claim. (M. Op., p. 14.)

In a lengthy dissent, Judge Turner emphasized, among other things, that key aspects of the last clause were included during prosecution via an Examiner’s Amendment such that the original version of the Limitation recited:

 locating encryption information that identifies encrypted portions of frames of video within the selected stream. (D. Op., p. 3.)

In light of this, Turner argued “that a more reasonable construction of the same limitation is that the term “within” modifies the ‘frames of video.’” (D. Op., p. 4.) However, the majority disagreed for various reasons, one of which was because “the Examiner’s Interview Summary specifically states that the amendment was proposed in-part to ‘clarify the claim limitations.’” (M. Op., p. 21; emphasis added.)

This case is a helpful reminder that claim construction often includes considering many reasonable interpretations, which might result in diverging patentability determination. The challenge then becomes determining which construction is proper.