K-Fee System GMBH

Patent Trials and Appeals Board

Jan 18, 2022

IPR2021-01222 (P.T.A.B. Jan. 18, 2022)

Trials@uspto.gov Paper 9 571-272-7822 Date: January 18, 2022 UNITED STATES PATENT AND TRADEMARK OFFICE BEFORE THE PATENT TRIAL AND APPEAL BOARD NESPRESSO USA, INC., Petitioner, v. K-FEE SYSTEM GMHB, Patent Owner. IPR2021-01222 Patent 10,858,177 B2 Before GRACE KARAFFA OBERMANN, JAMES J. MAYBERRY, and ERIC C. JESCHKE, Administrative Patent Judges. MAYBERRY, Administrative Patent Judge. DECISION Denying Institution of Inter Partes Review 35 U.S.C. § 325(d) IPR2021-01222 Patent 10,858,177 B2 2 I. INTRODUCTION A. Background and Summary Petitioner, Nespresso USA, Inc., filed a Petition (“Pet.”) requesting inter partes review of claims 1-20 (“Challenged Claims”) of U.S. Patent No. 10,858,177 B2 (Ex. 1001, the “’177 patent”). Pet. 1. Patent Owner, K- fee System GmbH, filed a Preliminary Response (“Prelim. Resp.”) to the Petition. Paper 6. With our authorization, Petitioner filed a Preliminary Reply (Paper 7, “Prelim. Reply”) and Patent Owner filed a Preliminary Sur- reply (Paper 8, “Prelim. Sur-reply”). We have authority under 35 U.S.C. § 314 to determine whether to institute review. See also 37 C.F.R. § 42.4(a) (2021) (permitting the Board to institute trial on behalf of the Director). To institute an inter partes review, we must determine that the information presented in the Petition shows “a reasonable likelihood that the petitioner would prevail with respect to at least [one] of the claims challenged in the petition.” 35 U.S.C. § 314(a) (2018). For the reasons set forth below, upon considering the Petition, Preliminary Response, Preliminary Reply, Preliminary Sur-reply, and evidence of record, we exercise discretion under 35 U.S.C. § 325(d) and do not institute an inter partes review. B. Real Parties-in-Interest Petitioner identifies Nestle USA, Inc., Nestle Nespresso SA, and Societe Des Produits Nestle SA as the real parties-in-interest. Pet. 85-86. Patent Owner identifies itself as the sole real party-in-interest. Paper 4, 2. Patent Owner adds that it “is a wholly owned subsidiary of Kruger GmbH & Co. KG, along with Kruger North America, Inc.” Id. IPR2021-01222 Patent 10,858,177 B2 3 C. Related Matters The ’177 patent is the subject of litigation in the U.S. District Court for the Central District of California, in a case styled K-Fee System GmbH v. Nespresso USA, Inc., Case No. 2:21-cv-3402. Pet. 86; Paper 4, 2; see Ex. 2007 (identifying the court as the U.S. District Court for the Central District of California). Petitioner also filed petitions seeking inter partes review of U.S. Patent No. 10,858,176 (the “’176 patent,” IPR2021-01221) and U.S. Patent No. 10,870,531 (the “’531 patent,” IPR2021-01223). Pet. 86; Paper 4, 2. D. The ’177 Patent The ’177 patent, titled “Portion Capsule Having an Identifier,” issued December 8, 2020, from an application filed April 28, 2020, and ultimately claims priority to three German patent applications, the earliest of which was filed July 22, 2010. Ex. 1001, codes (54), (45), (22), (30). The application that matured into the ’177 patent is related, through a series of continuation and divisional applications, to application No. PCT/EP2011/003677, filed on July 22, 2011. Id. at code (60). The ’177 patent is directed “a portion capsule for producing a beverage” where “the portion capsule has an identifier that . . . individualize[s] the . . . capsule.” Ex. 1001, 1:11-14, 1:35-36, 1:61-62. We reproduce Figure 2A from the ’177 patent below. IPR2021-01222 Patent 10,858,177 B2 4 Figure 2A depicts “a portion capsule containing a barcode.” Ex. 1001, 7:31-32. Portion capsule 1 includes base element 2 with wall region 2.1 and bottom area 2.2. Id. at 8:40-43. Portion capsule 1 includes barcode 50 on the top surface of membrane 4. Id. at 8:43-45. Alternatively, barcode 50 could be placed on the edge region of flange 17, opposite membrane 4, as indicated by arrow 15. Id. at 8:50-52. In an alternative configuration, base element 2 includes an electrically conductive region, such as a raised ring. Ex. 1001, 9:14-16; see Fig. 6 (depicting ring 2.3). We reproduce Figures 20 and 21 from the ’177 patent below. IPR2021-01222 Patent 10,858,177 B2 5 Figure 20 depicts “a schematic view of a portion capsule,” and Figure 22 depicts a “sectional view[] of the portion capsule.” Ex. 1001, 7:62-66. These figures show grooves 32 in the wall region of portion capsule 1. Id. at 11:62-65. “The portion capsule material or the base element’s material is so thin that the implementation of grooves 32 at the exterior . . . leads to corresponding convexities 34 and impressions at the interior.” Id. at 12:44-47. The grooves reinforce or stiffen the wall region of portion capsule 1. Id. at 12:6-9. E. Illustrative Claim Of the Challenged Claims, claims 1, 7, and 9 are independent claims. Claim 1 is representative and we reproduce it below 1. A beverage system for producing a beverage, comprising: a portion capsule comprising: a foil lid sealed to a base element having a cavity within which a beverage raw material is provided, the base element comprising a circumferential flange having a top side to which the lid is attached and a bottom side with a barcode located on the bottom side, and a beverage machine comprising: a detector to read the barcode, a media chute configured to receive and support the portion capsule, and a pump controlled to push water into the portion capsule only upon a determination that the read barcode agrees with a stored reference, IPR2021-01222 Patent 10,858,177 B2 6 wherein the base element has a wall region with an electrically conductive section and radially spaced and vertically oriented drawn grooves, the cavity has radially spaced and vertically oriented drawn ribs. Ex. 1001, 12:52-13:2. F. Prior Art and Asserted Grounds Petitioner asserts that the Challenged Claims are unpatentable on the following grounds: Claim(s) Challenged 35 U.S.C. § References/Basis 1, 4-9, 12-20 103 Yoakim,1 Jarisch,2 Rapparini3 2, 3, 10, 11 103 Yoakim, Jarisch, Rapparini, Castellani4 1, 4-9, 12-20 103 Panesar,5 Mock6 2, 3, 10, 11 103 Panesar, Mock, Castellani II. ANALYSIS A. Discretionary Denial under 35 U.S.C. § 325(d) Patent Owner contends that we should exercise our discretion under 35 U.S.C. § 325(d) to deny the Petition, applying our precedential decisions in Advanced Bionics, LLC v. MED-EL Elektromedizinische Geräte GmbH, 1 Yoakim et al., US 2010/0239734 A1, published September 23, 2010 (Ex. 1004, “Yoakim”). 2 Jarisch et al., US 2013/0064937 A1, published March 14, 2013 (Ex. 1005, “Jarisch”). 3 Rapparini, US 2012/0269933 A1, published October 25, 2012 (Ex. 1008, “Rapparini”). 4 Castellani, US 2008/0105131 A1, published May 8, 2008 (Ex. 1009, “Castellani”). 5 Panesar et al., WO 2005/079638 A1, published September 1, 2005 (Ex. 1010, “Panesar”). 6 Mock et al., US 2006/0233921 A1, published October 19, 2006 (Ex. 1011, “Mock”). IPR2021-01222 Patent 10,858,177 B2 7 IPR2019-01469, Paper 6 (PTAB Feb. 13, 2020) (precedential) (“Advanced Bionics”) and Becton, Dickinson & Co. v. B. Braun Melsungen AG, IPR2017-01586, Paper 8 (PTAB Dec. 15, 2017) (precedential as to § III.C.5, first paragraph) (“Becton, Dickinson”). Prelim. Resp. 8-23; Prelim. Sur- reply 4-7. For the reasons provided below, we exercise our discretion to deny institution under § 325(d). 1. Applicable Framework Section 325(d) provides that, in determining whether to institute an inter partes review, “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.” 35 U.S.C. § 325(d) (2018). The Board uses a two-part framework in determining whether to exercise its discretion under § 325(d), specifically: (1) whether the same or substantially the same art previously was presented to the Office or whether the same or substantially the same arguments previously were presented to the Office; and (2) if either condition of [the] first part of the framework is satisfied, whether the petitioner has demonstrated that the Office erred in a manner material to the patentability of challenged claims. Advanced Bionics, Paper 6 at 8. In applying the two-part framework, we consider several non- exclusive factors from Becton, Dickinson, which provide “useful insight into how to apply the framework” (Advanced Bionics, Paper 6 at 9): (a) the similarities and material differences between the asserted art and the prior art involved during examination; (b) the cumulative nature of the asserted art and the prior art evaluated during examination; (c) the extent to which the asserted art was evaluated during examination, including whether the prior art was the basis for rejection; (d) the extent of the overlap between the IPR2021-01222 Patent 10,858,177 B2 8 arguments made during examination and the manner in which Petitioner relies on the prior art or Patent Owner distinguishes the prior art; (e) whether Petitioner has pointed out sufficiently how the examiner erred in its evaluation of the asserted prior art; and (f) the extent to which additional evidence and facts presented in the Petition warrant reconsideration of the prior art or arguments. Becton, Dickinson, Paper 8 at 17-18. If, after review of factors (a), (b), and (d), we determine that the same or substantially the same art or arguments previously were presented to the Office, we then review factors (c), (e), and (f), which relate to whether the petitioner demonstrates that the Office erred in a manner material to the patentability of the challenged claims. Advanced Bionics, Paper 6 at 10. 2. Analysis We organize our analysis into three main sections. First, we review the prosecution history. Next, we discuss part 1 of the Advanced Bionics framework, including whether the challenges advanced in the Petition raise the same or substantially the same prior art references or arguments previously presented to the Office. As part of that analysis, we look to the similarities, and material differences, between the asserted art and the prior art involved during examination and the cumulative nature of the asserted art and the prior art evaluated during examination, and whether the challenges set forth in the Petition raise the same or substantially the same arguments previously presented to the Office. Finally, we turn to part 2 of the Advanced Bionics framework, where we address whether Petitioner establishes sufficiently that the Office erred in its previous assessment of the prior art or arguments in a manner material to the patentability of the challenged claims. IPR2021-01222 Patent 10,858,177 B2 9 a) Scope of the prosecution history of the ’177 patent In a first Office Action, the examiner rejected all of the claims of the application that matured into the ’177 patent, as either anticipated by US 2008/0187638 (“Hansen”) or as obvious over Hansen and other prior art. Ex. 1002, Part 1, 185-192; cf. Pet. 84 (arguing the differences between Hansen and Panesar). In response, the applicant amended pending independent claim 1 to require the wall region of a portion capsule to include an electrically conductive section and radially spaced grooves and ribs. Id. at Part 1, 265. The applicant amended independent claim 20, which issued as claim 7, to require the base element of a portion capsule to include an electrically conductive section, and a circumferential border adjacent to the flange, where the border has a larger diameter than the diameter of the wall region. Id. at Part 1, 266-267, 377. The applicant amended independent claim 23, which issued as claim 9, to require an electrically conductive section of a wall region, a circumferential border adjacent to the flange, where the border has a larger diameter than the diameter of the wall region, and radially spaced grooves and ribs. Id. at Part 1, 267, 377. The applicant argued that the prior art of record did not disclose the added subject matter. Id. at Part 1, 271-274. The examiner allowed the claims, stating that “none of the cited prior art discloses or suggests the base element has a wall region with an electrically conductive section and radially spaced and vertically oriented drawn grooves, the cavity has radially spaced and vertically oriented drawn ribs.” Ex. 1002, Part 1, 372. The prosecution history also includes Information Disclosure Statements (IDSs) initialed by the examiner and including Yoakim, Jarisch, Panesar, Rapparini. Ex. 1002, Part 1, 397-417 (indicating that “ALL IPR2021-01222 Patent 10,858,177 B2 10 REFERENCES CONSIDERED EXCEPT WHERE LINED THROUGH. /B.W.J./”); see id. at Part 1, 403 (including Yoakim), 404 (including Jarisch), 414 (including Panesar), 415 (including WO 2011/047836 A1 to Rapparini7). Neither Yoakim, Jarisch, Panesar, nor Rapparini were included in an express rejection by the examiner. See id. at Part 1, 185-192. b) Advanced Bionics, Part 1 (1) Petitioner’s disregard of the conjunctive “or” in § 325(d) Section 325(d) states, in relevant part, that “[i]n determining whether to institute [an inter partes review], the Director may take into account whether, and reject the petition . . . because, the same or substantially the same prior art or arguments previously were presented to the Office.” 35 U.S.C. § 325(d) (emphasis added). Petitioner effectively disregards whether the same or substantially the same prior art previously was presented to the Office, focusing instead almost exclusively on whether the examiner applied in any rejection the same prior art combinations asserted in the Petition. See Pet. 82-83. Petitioner contends that “none of the references in the Petition were applied by the [e]xaminer in any office action during prosecution of this application. Therefore, the combinations of Yoakim/Jarisch, and Panesar/Mock were also never considered.” Pet. 82; see also Prelim. Reply 5 (arguing that “[t]he [e]xaminer never rejected the ’177 [p]atent claims using any of the four Grounds in this Petition, or Grounds 7 “WO 2011/047836 . . . is the publication of PCT/EP10/006389, to which Rapparini (US 2011/0269933) claims priority.” Prelim. Resp. 8 n.2. Patent Owner asserts, and Petitioner does not deny, that WO 2011/047836 and Rapparini “are substantively identical to one another and each contain the same disclosure” upon which Petitioner relies. Id. IPR2021-01222 Patent 10,858,177 B2 11 substantially similar”). Petitioner supports its contention by citing to prior Board decisions, where the Board declined to exercise its discretion under § 325(d) because the prior art on which the petitioner relied was merely cited on an IDS. Pet. 83; Prelim. Reply 5. Petitioner, in other words, focuses only on whether the same arguments about the prior art previously were addressed expressly by the examiner. That focus, in practical effect, disregards the conjunctive “or” that appears in the statute. 35 U.S.C. § 325(d). Where either the prior art references advanced or the arguments raised in a petition previously were presented to the Office, the inquiry shifts to whether the petitioner establishes a material error. Advanced Bionics, Paper 6 at 8. Petitioner relies on non-precedential Board decisions, which predate Advanced Bionics, to argue that “[t]he ‘mere submission of a reference in an IDS is insufficient for purposes of exercising discretion’” to deny review under Section 325(d). Pet. 82-83 (citing Amgen Inc. v. Alexion Pharma., Inc., IPR2019-00740, Paper 15 at 65-66 (PTAB Aug. 30, 2019)). The precedential decision in Advanced Bionics unambiguously instructs, however, “[p]reviously presented art includes art made of record by the Examiner, and art provided to the Office by an applicant, such as on an Information Disclosure Statement (IDS), in the prosecution history of the challenged patent.” Advanced Bionics, Paper 6 at 7-8. Petitioner does not address that instruction. We next explore the question, which Petitioner does not address adequately, concerning whether the same or substantially the same prior art previously was presented to the Office. IPR2021-01222 Patent 10,858,177 B2 12 (2) Similarities and material differences between, or cumulative nature of the asserted art and the prior art involved during examination (a) Yoakim, Jarisch, Panesar, and Rapparini As we discussed above, Yoakim, Jarisch, Pansear, and a reference substantially the same as Rapparini were identified on an IDS entered during the prosecution of the application that matured into the ’177 patent. Given that Yoakim, Jarisch, Panesar, and a publication sharing substantially the same disclosure as Rapparini were presented to the examiner, and “considered” and “not lined through,” we find unpersuasive Petitioner’s argument that the Board may dismiss as “not considered” the four references, which undeniably were presented to the examiner but not discussed in any Office action directed to the ’177 patent. See Ex. 1002, Part 1, 397-417 (indicating that “ALL REFERENCES CONSIDERED EXCEPT WHERE LINED THROUGH. /B.W.J./”), 403, 404, 414, 415. Further, during prosecution of applications from which the ’177 patent claims priority, the Office applied Jarisch in rejections. See Prelim. Resp. 8 (Jarisch “was previously considered and distinguished during prosecution of the ’176 and ’531[] [p]atents, which are family members of the ’177 [p]atent.”), id. at 10-12 (discussing Jarisch in the prosecution of the ’176 and ’531 patents); Prelim. Sur-reply 4-5 (“Petitioner does not deny that it . . . assert[s] the same reference (Jarisch) as disclosing precisely the same claim element (the location of a code on the bottom side of the flange) in the same way as the examiner did during the prosecution of the ’176 and ’531 [p]atents.”). IPR2021-01222 Patent 10,858,177 B2 13 Based on the information presented, we determine that Yoakim, Jarisch, Panesar, and Rapparini previously were presented to the examiner during patent examination. (b) Mock Neither party directs us to information that Mock previously was presented to the Office. In this subsection, we assess Patent Owner’s argument that Mock, although “not cited during prosecution,” is cumulative of Rapparini, which was “before the examiner.” Prelim. Resp. 10 (“The Mock reference was not cited during prosecution, but references disclosing ribs, such as Rapparini, were before the examiner.”). Petitioner advances Mock for disclosing a “base element ha[ving] a wall region with an electrically conductive section and radially spaced and vertically oriented drawn grooves, the cavity has radially spaced and vertically oriented drawn ribs.” Pet. 66-68. Petitioner asserts that an ordinarily skilled artisan would have been led to modify Panesar in view of Mock to “allow for more stable and strengthened capsules with reduced unwanted rotations.” Id. at 57. Petitioner assesses the cumulative nature of Mock not at all in the Petition, only stating that the combination of Panesar and Mock “are unique and not cumulative of any rejection during prosecution.” Id. at 82-84. In the Preliminary Reply, Petitioner advances one sentence on point: “Mock is not cumulative to other references as it shows an aluminum capsule with grooves configured in a manner relevant to Patent Owner’s claims.” Prelim. Reply 6. Petitioner also asserts, without analysis, the following quotation from Becton, Dickinson: “[M]aterial differences between the asserted art and the prior art involved during examination” weigh against discretionary denial. Pet. 84 (quoting Becton, Dickinson, Paper 8 at 17-18). There, the Board IPR2021-01222 Patent 10,858,177 B2 14 assessed material differences between prior art previously presented to the examiner and different, but cumulative, prior art raised in a petition. Becton, Dickinson, Paper 8 at 17-18. In the instant case, however, Petitioner does not identify adequately any material difference between the disclosures of Mock and Rapparini. See Prelim. Reply 6 (“Mock is not cumulative to other references as it shows an aluminum capsule with grooves configured in a manner relevant to” the challenged claims.). On the contrary, Petitioner asserts Mock and Rapparini for substantially similar disclosures. Specifically, in that regard, Petitioner asserts Mock for the use of “metal material and grooves and ribs,” which confer benefits that include “increasing the strength and stability of the” beverage capsule. Pet. 56. Petitioner similarly asserts that Rapparini discloses “longitudinal grooves in the body of the capsule wall and corresponding ribs in the inner cavity, thus increasing stability of the portion capsule.” Id. at 31. Additionally, Petitioner asserts that both Rapparini and Mock provide express motivation to use teachings from the reference. See id. at 31, 57. Given that Rapparini discloses a metal capsule, having grooves configured to increase stability, Petitioner does not explain adequately, if at all, how Mock differs in any material respect from Rapparini. See Prelim. Reply 6. On this record, for purposes of deciding whether to institute review, we find that Mock is cumulative of Rapparini. (c) Castellani Neither party asserts that Castellani was presented to the examiner during the examination of the application that matured into the ’177 patent or any parent application. See Pet. 82-85; Prelim. Resp. 10, 14. Nor does either party address whether Castellani is cumulative of any reference IPR2021-01222 Patent 10,858,177 B2 15 previously presented to the Office. See Pet. 82-84; Prelim. Resp. 10-23; Prelim. Reply 5-8; 4-10. Based on the information provided by the parties, therefore, we determine on this record that Castellani is a new reference, in the sense that it was not previously presented to the Office, for example, during prosecution of the application that matured into the ’177 patent or parent applications. (d) Conclusions on the Similarity of the Prior Art To summarize, four of the six references asserted in Petitioner’s challenges (Yoakim, Jarisch, Rapparini, and Panesar) previously were presented to the Office. One of those references (Jarisch) was a focus of patent examination in the application to which the ’177 patent claims priority. A fifth reference, Mock, is cumulative of Rapparini, which is a reference previously presented to the Examiner during prosecution. However, a sixth and final reference asserted in the Petition (Castellani) is new, in the sense that it was not previously presented to the examiner in connection with the examination of the application that matured into the ’177 patent or any parent application. In this section, we assess whether the addition of Castellani to Grounds 2 and 4 of the Petition supports a finding that Petitioner’s challenges do not raise the same or substantially the same prior art that previously was presented to the Office. For two reasons, we find that Castellani’s addition does not change the calculus regarding whether the same or substantially the same prior art previously was presented to the Office. First, Petitioner advances Castellani only in connection with a subset of dependent challenged claims, namely, claims 2, 3, 10, and 11. Pet. 50-55, 78-81. A trial in this case necessarily would involve all claims based on all challenges raised in the Petition. See IPR2021-01222 Patent 10,858,177 B2 16 SAS Inst., Inc. v. Iancu, 138 S. Ct. 1348, 1354, 1359-60 (2018); 37 C.F.R. § 42.108(a) (“When instituting inter partes review, the Board will authorize the review to proceed on all of the challenged claims and on all grounds of unpatentability asserted for each claim.”). In other words, significant Board and party resources necessarily would be devoted to assessing whether all of the independent claims (claims 1, 7, and 9) and a majority of the dependent claims (claims 4-6, 8, 12-20) are unpatentable in view of prior art references that are the same as, or cumulative of, references previously presented to the Office. See Pet. 21 (providing grounds chart). Castellani’s disclosure, by contrast, would come into play only in connection with a minority of the dependent challenged claims. See id. at 50-55, 78-81 (showing how Castellani is applied in the Petition, and only with respect to four dependent claims, namely, claims 2, 3, 10, and 11). Second, Petitioner advances Castellani in combination with multiple references that are the same as, or cumulative to, references previously presented to the examiner. See Pet. 21, 50-55, 78-81 (showing that Petitioner asserts Castellani only in combination with (1) Yoakim, Jarisch, and Rapparini, or (2) Panesar and Mock). Significantly, even in the grounds that assert Castellani, Petitioner relies on references that were previously presented to the examiner for disclosure of “all elements of claims 2-3 and 10-11 except for” “the holding arms to engage the portion capsule” and “a capsule dropping box.” Pet. 50, 78; see id. at 21 (showing that Petitioner asserts Castellani in combination with (1) Yoakim, Jarisch, and Rapparini, and (2) Panesar and Mock only). Stated somewhat differently, Petitioner asserts Castellani only for disclosure of two limitations of a minority of dependent challenged claims. IPR2021-01222 Patent 10,858,177 B2 17 To summarize, Petitioner asserts Castellani only in connection with two limitations of a subset of the dependent challenged claims. A trial in this case necessarily would require the Board to assess whether both independent claims, as well as the majority of the dependent challenged claims, are unpatentable in view of the same or substantially the same references previously presented to the Office. Accordingly, on this record, we find that Petitioner’s challenges raise substantially the same prior art previously presented to the Office. That determination, standing alone, warrants our assessment of the second part of the two-part framework articulated in Advanced Bionics, namely, whether Petitioner directs us to evidence sufficient to demonstrate a material examiner error. See Advanced Bionics, Paper 6 at 8. Before turning to that question, however, we also address in the next section whether, and to what extent, Petitioner raises arguments that are the same or substantially the same as those previously presented to the examiner. Our assessment, on that point, provides an alternative rationale that independently warrants our consideration of the adequacy of Petitioner’s information pertaining to material examiner error. (3) Same or Substantially the Same Arguments As Patent Owner points out, the inquiry under Section 325(d) “focuses on ‘the extent of the overlap between the arguments made during examination and the manner in which [P]etitioner relies on the prior art.’” Prelim. Sur-reply 5 (quoting Advanced Bionics, Paper 6 at 9 n.10). In the next three subparts of our analysis, we assess the extent of the overlap between the arguments raised in the Petition and those considered by the examiner. IPR2021-01222 Patent 10,858,177 B2 18 (a) Jarisch’s Figure 4 and the Specified Barcode Location Patent Owner directs us to information tending to show that Petitioner raises substantially the same arguments previously presented to the Office (during prosecution of applications to which the ’177 patent claims priority) concerning Jarisch’s Figure 4 and, in particular, the barcode location as specified in the challenged claims. Prelim. Resp. 10-12. In a rejection that applied Jarisch, the examiner considered whether that reference teaches “a method for making coffee by reading a code location of the flange bottom” where “the capsule” is “sealed by a foil lid.” Ex. 1002-176, Part 1, 98 (cited by Patent Owner at Prelim. Resp. 10-118). In connection with that argument, the examiner cited Jarisch’s Figure 4, reproduced below, to find that this figure shows sensor 62 directing a beam toward bottom side 72 of flange 73. Id. 8 The parties reference Ex. 1002 from the related inter partes review proceeding IPR2021-01221 (which challenges the ’176 patent) as “Ex. 1002-176.” See, e.g., Prelim. Resp. 11. We use that convention here (as well as a similar convention for the ’531 patent and IPR2021-01223). IPR2021-01222 Patent 10,858,177 B2 19 Ex. 1005, Fig. 4; see Pet. 30 (reproducing this figure). Figure 4 illustrates a position of a code on a capsule “when placed on the underside of the rim of the capsule,” where the capsule is “fitted into a capsule holder.” Ex. 1005 ¶ 31. Capsule 7 includes code 70 on bottom side 72 of rim 73. Id. ¶ 64. Light source 63 at the bottom of centrifugal cell 3 conducts a beam to bottom side 72 of rim 73 and reflected light is conducted back to sensor 52. Id. ¶¶ 63, 82. Petitioner asserts arguments about Jarisch that are substantially the same as those considered by the examiner. Compare Pet. 28-30, with Ex. 1002-176, Part 1, 98. In particular, Petitioner asserts that Figure 4 from Jarisch, in combination with other references, renders obvious the limitation that requires a “barcode” on the “bottom side” of a “circumferential flange.” See Pet. 34 (discussing claim elements 1.b and 1.c). Petitioner focuses on Jarisch’s Figure 4, arguing that Jarisch, in combination with Yoakim, would have suggested a “code placement of Jarisch on the bottom flange of the capsule.” Pet. 29. The examiner, likewise, focused on Jarisch’s Figure 4 to conclude that the reference would have suggested to an ordinarily skilled artisan “a method for making coffee by reading a code located on the flange bottom” of a beverage portion capsule. Ex. 1002-176, Part 1, 98; see id. at 273-274 (providing examiner’s continued focus on Jarisch’s Figure 4 as suggesting the specified code location); see also id. at 403-404 (providing applicant’s argument that the combination of references, including Jarisch, does not render obvious a “barcode being located on a bottom side of a circumferential flange, the bottom side opposing a top side to which the foil lid is attached”). Patent Owner, for its part, directs us to evidence that “the [e]xaminer and Patent Owner discussed Jarisch and its disclosure of a code located on IPR2021-01222 Patent 10,858,177 B2 20 the bottom side of the flange in every substantive communication between the parties.” Prelim. Resp. 10-12 (citing Ex. 1002-176, Part 1, 98, 145, 273-274, 397, 403-404). Against that backdrop, we find, Petitioner does not explain adequately, if at all, “how the arguments it now advances for Jarisch are different from what was previously presented” to the Office. Prelim. Sur-reply 4-5. Specifically, Patent Owner in the Preliminary Response emphasizes the similarities between Petitioner’s and the examiner’s arguments in connection with Jarisch. Prelim. Resp. 10-12. Notwithstanding that emphasis, Petitioner, in the Reply, makes no meaningful attempt “to show that these arguments do not overlap.” Prelim. Sur-reply 6; see Prelim. Reply 5-7 (inadequate analysis pertaining to the relevant question of overlap). On this record, therefore, we find that Petitioner advances the same disclosure (Figure 4) in the same reference (Jarisch) to make out the same claim limitation (the specified barcode location) as previously considered by the Office. See Pet. 29-30, 34; Ex. 1002-176, Part 1, 98, 145, 273-274, 397, 403-404. (b) The Prior Art Status of Jarisch In View of the German Priority Documents The Petition raises a second issue previously considered by the Office, namely, whether the claimed invention is entitled to a priority date of July 22, 2010, based on certain German priority documents, thereby disqualifying Jarisch as prior art under 35 U.S.C. § 102(e). See Pet. 15-18 (discussing priority to the German applications), 22-23 (asserting Jarisch as prior art under § 102(e)), 85 (arguing that the examiner did not consider Jarisch because of an error in priority); Ex. 1002-176, Part 1, 278. IPR2021-01222 Patent 10,858,177 B2 21 Both parties brief this very same issue in this proceeding. See Pet. 15-18 (arguing that the challenged claims are not entitled to priority based on the German priority documents), 85 (arguing the examiner applied an incorrect priority date, based on the German priority documents, to antedate Jarisch); Prelim. Resp. 4-6, 16-22; Prelim. Reply 8-10; Prelim. Sur-reply 7-10. Petitioner focuses only on whether the examiner erred in assessing that argument. Pet. 85. Petitioner does not, and cannot, submit that the Office never considered the issue during patent prosecution, at least with respect to applications in the priority chain of the ’177 patent. The Office, in fact, expressly considered whether “Jarisch is not prior art” because the challenged claims are “entitled to a priority date of 22 July 2010” based on the German priority documents. Ex. 1002-176, Part 1, 278 (prosecution history for the grandparent application). The Office also expressly responded to Patent Owner’s argument on that point as follows: “This urging is not deemed persuasive.” Id. This issue represents a second, significant argument previously presented to the Office. (c) Conclusions on the Extent of Overlap of Arguments We agree with Petitioner that the examiner did not apply, in any Office action, the same combination of prior art references asserted in the Petition. Pet. 82-84. That does not end the inquiry, however, where the Petition includes other significant arguments that, at minimum, “overlap” with those previously presented to the Office. Advanced Bionics, Paper 6 at 9 n.10. For example, the Petition raises the same disclosure in Jarisch (Figure 4) to make out the same claimed feature (barcode location) as previously addressed by the Office. Compare Pet. 29-30, 34, with IPR2021-01222 Patent 10,858,177 B2 22 Ex. 1002-176, Part 1, 98, 145, 273-274, 397, 403-404 (prosecution history of the application that matured into the ’176 patent). Petitioner also raises arguments concerning whether the German priority documents are sufficient to establish a priority date for the claimed invention that predates Jarisch, thereby disqualifying Jarisch as prior art. Pet. 15-18, 85. The Office squarely addressed the same German priority documents in connection with Patent Owner’s position that it “had possession of the claimed subject matter” prior to the publication of Jarisch. Ex. 1002-176, Part 1, 278, 397. Arguments pertaining to that issue consume a significant portion of the briefs in this proceeding. Pet. 15-18, 85; Prelim. Resp. 4-6, 16-22; Prelim. Reply 8-10; Prelim. Sur-reply 7-10. On this record, we determine that the degree of overlap is significant between arguments raised in the Petition and those previously presented to the Office. The overlapping issues, especially those surrounding the priority dispute, likely would consume significant resources during a trial. Our determination, that substantially the same arguments were previously considered by the Office, represents an alternative rationale that independently warrants our consideration of the adequacy of Petitioner’s information pertaining to examiner error, which we turn to next. c) Advanced Bionics, Part 2: Examiner error Because we found that the same or substantially the same art or arguments previously were presented to the Office, we move to the second part of the Advanced Bionics framework: determining “whether the petitioner has demonstrated that the Office erred in a manner material to the patentability of challenged claims.” Advanced Bionics, Paper 6 at 8. Petitioner directs us to two allegedly material examiner errors. Pet. 84-85. First, Petitioner argues, the examiner materially erred by IPR2021-01222 Patent 10,858,177 B2 23 applying “an incorrect priority date” to find that Jarisch does not qualify as prior art. Id. at 85. Second, Petitioner submits, the examiner materially erred by allowing the challenged claims to issue “without comment and without considering the art” asserted in the Petition. Id. at 84-85. We address each asserted error in turn below. (1) Alleged error relating to priority date During the examination of the application that matured into the ’176 patent, the examiner expressly considered and rejected the argument “that the German priority applications” contain “support for the applied for claims.” Prelim. Resp. 11-12 (citing Ex. 1002-176, Part 1, 258-259). As Patent Owner correctly points out, “[t]he [e]xaminer stood on the rejection that relied upon Jarisch.” Id. at 12 (citing Ex. 1002-176, Part 1, 273-274). The examiner thereafter allowed “the applied-for claims” in the application based on arguments presented by Patent Owner, but did not indicate which arguments, in particular, the examiner deemed persuasive. See Prelim. Resp. 12 (citing Ex. 1002-176, Part 1, 403-404, 435-439). Furthermore, at the time of allowance of the claims of the ’531 patent, which matured from the parent application to the ’177 patent, Patent Owner was pressing two alternative arguments before the examiner. Patent Owner maintained both that (1) Jarisch is not prior art because the German priority applications support the challenged claims and (2) that the claimed invention, including the feature relating to the location of the barcode, would not have been obvious over the combination of prior art references applied by the examiner, including Jarisch. Ex. 1002-531, 300-303, 307-3099. 9 “Ex. 1002-531” is Ex. 1002 from IPR2021-01223, which concerns the ’531 patent. IPR2021-01222 Patent 10,858,177 B2 24 Where both alternatives were before the examiner, it is not at all clear that “the [e]xaminer applied an incorrect priority date” or otherwise accepted that Jarisch does not qualify as prior art. Cf. Pet. 85. We take note that, after the examiner issued the notice of allowance of claims in connection with the application that issued as the ’176 patent, an interview was conducted “to ensure that Patent Owner’s claim of priority was properly submitted and would appear on the face of the issuing patent.” Prelim. Sur-reply 6-7 (citing Ex. 1049-531, 70). Petitioner does not show sufficiently that this notice of interview, which appears in the file history of the grandparent application, demonstrates, “The [e]xaminer’s mistake affording Patent Owner . . . priority over the Jarisch reference is clear.” Prelim. Reply 8; see Ex. 1002-531, 307-309 (providing the examiner’s continued argument, during the subsequent examination of the ’531 patent claims, that Patent Owner failed to establish priority over Jarisch based on the German priority documents). Petitioner directs us to no record evidence tending to show that the examiner accepted Patent Owner’s view that it had possession of the claimed invention prior to the publication date of Jarisch. See Pet. 85 (arguing that “Jarisch may not have been considered by the [e]xaminer because of an improper finding of priority”). On the contrary, the examiner expressly considered and rejected Patent Owner’s view that the German priority documents demonstrate possession of the claimed invention, during both the examination of the ’531 patent and the ’176 patent. Ex. 1002-531, 307-309; Ex. 1002-176, Part 1, 278. Accordingly, on this record, we find Petitioner fails to establish a material error by the examiner in connection with the priority issue. IPR2021-01222 Patent 10,858,177 B2 25 (2) Failure to consider petition evidence Additionally, Petitioner submits that the examiner erred by allowing the challenged claims to issue “without comment and without considering the art in this petition.” Pet. 84-85. We reject Petitioner’s unsupported argument that the examiner allowed the claims to issue “without considering the art” presented in the Petition, as four of the six asserted references were considered by the examiner, and an additional one of the references is cumulative of a reference considered by the examiner. Petitioner advances dicta from a non-precedential Board decision, which issued before the precedential Advanced Bionics decision, in support of its view that “a reference that was neither applied against the claims nor discussed by the [e]xaminer does not weigh in favor of” a discretionary denial. Pet. 84-85 (quoting Amazon, Inc. v. M2M Sols. LLC, IPR2019- 01204, Paper 14 at 17 (PTAB Jan. 23, 2020) (“Amazon”)). The Amazon decision concerned an examiner’s failure to consider prior art identified in a Board decision, supplied to the examiner, which granted inter partes review of claims closely related to the claims at issue. Amazon, Paper 14 at 12, 16. By the time the Board issued the Amazon decision, a final written decision invalidating those related patent claims was the subject of “a looming Federal Circuit decision” likely to “control the outcome.” Amazon, Paper 14 at 15. In other words, the examiner in Amazon allowed the claims to issue “without mentioning the related decision to institute,” even though the Board in that related decision applied the same prior art against claims having “materially similar limitations to the challenged claims.” Id. at 12-13. Petitioner directs us to the Amazon decision without providing any analysis tending to show how or why the facts of the instant case are remotely comparable to those at play in Amazon. Pet. 84-85. IPR2021-01222 Patent 10,858,177 B2 26 To the extent Petitioner argues that the relative strength of the grounds stated in the Petition, standing alone, supports a finding of material examiner error, that argument is not developed adequately and, therefore, is unpersuasive on this record. Pet. 84-85. Petitioner bears the burden of showing that the Office erred, for example, by “misapprehending or overlooking specific teachings of the relevant prior art whose teachings impact patentability of the challenged claims.” Advanced Bionics, Paper 6 at 8. Where “the record of the Office’s previous consideration of the art is not well developed or silent, then a petitioner may show the Office erred by overlooking something persuasive under” Becton, Dickinson factors (e) and (f). Advanced Bionics, Paper 6 at 10. As explained above, when assessing factor (e), we consider whether Petitioner “point[s] out sufficiently how the examiner erred in its evaluation of the asserted prior art.” Supra 8. When assessing factor (f), in turn, we look for some explanation of how or why “the extent to which additional evidence and facts presented in the petition warrant reconsideration of the prior art or arguments.” Id. Petitioner addresses neither of those issues adequately, if at all. Pet. 81-85; Prelim. Reply 5-10. The closest Petitioner comes to addressing those issues is by observing, “the obviousness analysis” in the Petition “is supported by expert testimony, which the Examiner did not have.” Pet. 85. That observation is undeveloped by further analysis and, therefore, is ineffective to show that the Examiner materially erred by failing to discuss the same prior art combinations advanced in the Petition, or that “additional evidence and facts presented in the Petition warrant reconsideration of the prior art” previously presented to the Office. Becton, Dickinson, Paper 8 at 18. IPR2021-01222 Patent 10,858,177 B2 27 Further, “although Becton, Dickinson factor (c) evaluates ‘the extent to which the asserted art was evaluated during examination, including whether the prior art was the basis for rejection,’ the focus should be on the record” of examination. Advanced Bionics, Paper 6 at 11; cf. Ex. 1002, Part 1, 187-191; Ex. 1002-531, 307-309 (discussion of obviousness rejections applied by the Examiner during examination of the application that matured into the ’531 patent); Ex. 1002-176, Part 1, 267-277, 403-404 (discussion of obviousness rejections applied by the Examiner during examination of the application that matured into the ’176 patent). Petitioner does not meaningfully assess the record of examination or explain sufficiently how or why Becton, Dickinson factor (c), (e), or (f) supports its positions. Instead, Petitioner directs us to a bare quotation from the Amazon decision and advances unsupported arguments about the German priority documents. Pet. 83-84 (quoting the Amazon decision and asserting without record support that “the Examiner applied an incorrect priority date” based on the German priority documents); Prelim. Reply 7 (arguing without record support that the Examiner did not consider Jarisch because of Patent Owner’s priority claim to the German priority documents).10 (3) Inadequacy of Petitioner’s Information on Material Error For the above reasons, Petitioner does not show sufficiently that the examiner erred in a manner material to the patentability of the challenged claims. Pet. 84-85; Prelim. Reply 7-10. In reaching that decision, we apply 10 The parties extensively brief issues directed to Patent Owner’s efforts to antedate Jarisch. See Pet. 15-18; Prelim. Resp. 16-22; Prelim. Reply 8-10, Prelim. Sur-reply 7-10. This effort misses the focus of § 325(d). The focus should be on the record evidence of what the Office did in prior proceedings, not Patent Owner’s efforts in the current proceeding. IPR2021-01222 Patent 10,858,177 B2 28 the principle that, “[i]f reasonable minds can disagree regarding the purported treatment of the art or arguments” by the examiner, then “it cannot be said that the Office erred in a manner material to patentability.” Prelim. Resp. 15 (quoting Advanced Bionics, Paper 6 at 9). This is a case where reasonable minds can differ, and the paucity of analysis provided by Petitioner in the Petition tips the scales in favor of a discretionary denial. See Pet. 84-85 (providing Petitioner’s insufficient arguments pertaining to material examiner error). d) Conclusions, discretion under 35 U.S.C. § 325(d) Taking a holistic view of the totality of the information presented, we determine that the challenges set forth in the Petition are based on the same or substantially the same prior art or arguments previously presented to the examiner. Moreover, Petitioner does not direct us to information sufficient to establish a material examiner error. Accordingly, we exercise our discretion under Section 325(d) and do not institute an inter partes review. B. Discretionary Denial under 35 U.S.C. § 314(a) Patent Owner also argues that we should exercise our discretion under 35 U.S.C. § 314(a) in light of parallel district court litigation involving the parties and the ’177 patent. Prelim. Resp. 36-44; Prelim. Sur-reply 1-4. Because we exercise our discretion under § 325(d) and deny the Petition, we do not reach this issue. III. CONCLUSION After considering all the evidence and arguments presently before us, we exercise our discretion under 35 U.S.C. § 325(d) to deny the Petition. Accordingly, we do not institute an inter partes review. IPR2021-01222 Patent 10,858,177 B2 29 IV. ORDER In consideration of the foregoing, it is hereby: ORDERED that, pursuant to 35 U.S.C. § 325(d), the Petition is denied. IPR2021-01222 Patent 10,858,177 B2 30 FOR PETITIONER: Clayton McCraw Amanda S. Bonner Donna Kwon MAYER BROWN LLP CMcCraw@mayerbrown.com asbonner@mayerbrown.com dkwon@mayerbrown.com FOR PATENT OWNER: Theodore Stevenson III S. Benjamin Pleune ALSTON & BIRD LLP ted.stevenson@alston.com ben.pleune@alston.com Eric M. Dobrusin Paul J. Palinski THE DOBRUSIN LAW FIRM P.C. EDobrusin@PatentCo.com PPalinski@PatentCo.com