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Hyatt v. Iancu

United States District Court, District of Columbia

July 31, 2018

GILBERT P. HYATT, Plaintiff,
v.
ANDREI IANCU, Defendant.

          MEMORANDUM OPINION [1]

          Royce C. Lamberth United States District Judge.

         I. Background

         Before the Court is a trio of actions brought under 35 U.S.C. §145, related to three of Gilbert Hyatt's applications to patent features of his "600- family" and "700-family" specifications that purport to describe innovations Mr. Hyatt made in the field of video processing and associated computing and memory architectures in the mid-1980s. Plaintiff Gilbert P. Hyatt is a prolific inventor who has received more than seventy issued patents and has, pending at various stages of prosecution and appeal, nearly 400 patent applications before the United States Patent and Trademark Office (PTO), the federal agency responsible for examining patent applications and for granting U.S. patents. 35 U.S.C. § 1, etseq. Andrei Iancu is the named defendant in these matters in his official capacity as the Under Secretary of Commerce for Intellectual Property and the Director of the PTO.[2] Because of the nature and lengthy history of these actions, the Court refers to the defendant as "PTO" throughout this opinion.

         Mr. Hyatt brought these actions pursuant to 35 U.S.C. § 145 to obtain patents on three of his patent applications following decisions in the Board of Patent Appeals and Interferences, now known as the Patent and Trial Appeal Board (the "Board").[3] Section 145 allows an applicant dissatisfied with the decision of the Board to "have remedy by civil action" in district court, rather than taking an appeal directly to the Federal Circuit.[4] See also Kappos v. Hyatt, 566 U.S. 431 (2012). In a series of opinions issued August 23, 2016, the Court found genuine disputes of material fact precluded summary judgment in these matters, which therefore required trials on the merits.[5]

         After the Court resolved the summary judgment motions, however, the PTO moved to dismiss these actions for prosecution laches. Def.'s Mot Dismiss, ECF No. 91. In that set of motions, PTO argued that Hyatt's conduct in prosecuting these three patent applications, as well as approximately 400 others, called for dismissal. Id. at 8-9. Mr. Hyatt, on the other hand, argued that the PTO was responsible for extensive delay in adjudicating many of the applications, PI. Mot. Dismiss, ECF No. 101 at 7-9, and made the case that he was entitled to discovery. Id. at 37-38. On March 16, 2017, the Court found that genuine disputes of material fact required treating the motions to dismiss as if they were for summary judgment, and denied them accordingly. ECF No. 116.

         With leave of Court, the PTO subsequently amended its answers to assert prosecution laches as an affirmative defense. ECF No. 123. The Court set the PTO's affirmative defense of prosecution laches across all three actions for a bench trial, [6] which also would consider evidence relating to Mr. Hyatt's approximately 400 other pending applications. ECF No. 150. The PTO, bearing the burden of proof on the affirmative defense of prosecution laches and upon agreement of the parties, presented its case-in-chief first. During the five trial days beginning October 6, 2017, during which the PTO presented its case-in-chief, the PTO presented the testimony of three witnesses. The parties also introduced a number of exhibits.[7]

         At the close of the PTO's case-in-chief on prosecution laches, Mr. Hyatt moved for judgment pursuant to Federal Rule of Civil Procedure 52(c). Upon consideration of the evidence and arguments presented during trial and the entire records in these cases up to that time, and review of the relevant case law, the Court found the PTO failed to prove unreasonable and unexplained delay that would support dismissal for prosecution laches, and accordingly granted Mr. Hyatt's motion.[8] The Court's ruling on prosecution laches necessitated trials on the merits in these three cases. Each of the three trials featured three witnesses: the plaintiff called Mr. Hyatt and his expert witness, Mr. Bradford Hite, while PTO called its expert, Dr. Kenneth Castleman.

         Plaintiffs expert Mr. Hite has booth a Bachelor of Science and a Master of Science degree in Electrical Engineering from California State University at Northridge. For the past 23 years, he has worked as an electrical engineer for ITT Corporation (including as a technical lead on certain projects), Magellan Systems, Raytheon, Curtis-Wright, Lear Astronics, MiniMed, RoundTrip Technologies, SiRF, Quallion LLC, Paylon Medical, ASML, and Neural Analytics. Trial Tr. 32:25-49:5 (Nov. 14, 2017 AM Session) (09-1872). Mr. Hite has worked on complex electrical engineering projects involving missile defense radars, flight control systems, the Global Positioning System ("GPS") for consumer and military applications, glucose meters and insulin pumps for diabetics and cancer pain-management, long-distance tracking, battery modules for military aircraft and space applications, avionics computers, and Doppler radar imaging for concussions in football.

         Mr. Hite's experience with memory systems and image processing includes a project at ITT in 1984 working on graphical displays for equipment that interfaced with external control devices like keyboards for which he contributed computer code, and working on image processors and various types of memory architectures for a Navy missile defense project with ITT in 1987. During his tenure at Magellan, Mr. Hite worked on dot-matrix LCD displays that would scan out images, using a block of Random Access Memory ("RAM") to do so. At MiniMed, Mr. Hite's work included a graphical interface with RAM memory organization, and Mr. Hite wrote software to test and operate the display. Id. Mr. Hite was qualified without objection as an expert in application-specific processors, including memory and image processing. Trial Tr. 49:2-6 (Nov. 14, 2017 AM Session) (09-1872).

         Defense expert Dr. Castleman received his Bachelor of Science, Master of Science, and Doctor of Philosophy (Ph.D.) degrees in Electrical Engineering from the University of Texas at Austin. See Trial Tr. 477:9-11 (Feb. 14, 2018); see also DX3034 (0003). Dr. Castleman has more than fifteen years of experience in image processing for public sector endeavors, including in the image processing lab at NASA's Jet Propulsion Laboratory as a member of the Scientific Working Group on Imaging Technology for the FBI, where he assisted NASA in the image analysis of the Challenger and Columbia space shuttle accidents. See DX3034 (0001); see also 1872 Trial Tr. 19:14-22:19 (Nov. 15, 2017 PM Session). He also has about twenty years of private sector experience designing and building image processing systems as president (or CEO) of a company he co-founded. See Trial Tr. 477:11-14 (Feb. 14, 2018); see also Trial Tr. 1872 Trial Tr. 19:14-21:4 (Nov. 15, 2017 PM Session); 1872 Trial Tr. 22:20-24:15 (Nov. 15, 2017 PM Session); DX3034 (001-002).

         Dr. Castleman has written college-level textbooks on image processing, including Digital Image Processing (1979 and 1996 editions), published more than 60 scientific articles in technical journals, and has taught college courses related to image processing. See 1872 Trial Tr. 24:16-26:22 (Nov. 15, 2017 PM Session); Trial Tr. 477:23-478:2 (Feb. 14, 2018). He has previously served as an expert in approximately 33 cases. See DX3024.

         Each trial lasted five days. The Court addresses each case in chronological order by docket number, rather than the order in which they were tried.

         Case 05-2310 (the '211 application)

         Civil case 05-2310, filed November 18, 2005, concerns patent application 08/457, 211 (the '211 application), entitled "Improved Image Processing Architecture," which Mr. Hyatt filed with the PTO on June 1, 1995. One of several applications flowing from Mr. Hyatt's 641-page[9] "700-family" specification, the '211 application is a continuation of patent application serial number 07/289, 355, filed December 22, 1988, which is a continuation of patent application serial number 06/663, 094, filed October 19, 1984. The PTO entered a non-final Office Action rejecting the claims on September 22, 1995, and entered a final rejection made on July 31, 1996. Mr. Hyatt, using the transitional rules provided in 37 C.F.R. § 1.129(a) ("Rule 129(a)"), petitioned to file an amendment, the effective equivalent of a continuing application, on March 25, 1997. PTX-004.06587-89. The PTO issued a non-final Office Action rejecting the claims on August 3, 1998. PTX-004.6053-54. The PTO entered a final rejection of all claims on August 27, 1999. PTX-004.06373.

         Mr. Hyatt timely noticed his appeal to the Board on February 28, 2000, and he filed his appeal brief on August 28, 2000. PTX-004.04965. In the course of its decisions on Mr. Hyatt's appeal and subsequent motion for reconsideration, the Board reversed several rejections by the examiner of the'211 application claims and upheld others. See PTX-004.00103-04. Two hundred twenty-one claims in the '211 application remain before the Court, all of which were rejected by PTO for lack of written description. ECF No. 227 at 1. During a five-day trial that began on December 4, 2017, [10] Mr. Hyatt presented new evidence concerning sixty-six of those claims. SeePTX-912.[11]

         Case 09-1864 (the '398 application)

         Civil case 09-1864, filed September 25, 2009, concerns patent application 08/456, 398 (the '398 application), also entitled "Improved Image Processing Architecture" and sharing the 700-family specification, was similarly filed with the PTO on June 1, 1995. Like the '211 application, the '398 application is a continuation of patent application serial number 07/289, 355, filed December 22, 1988, which is a continuation of patent application serial number 06/663, 094, filed October 19, 1984. PTX-001.05919-23. The PTO entered a non-final Office Action rejecting the claims on September 19, 1995, and a final rejection on August 9, 1996. PTX-001.05137. Mr. Hyatt petitioned to enter a submission pursuant to 37 C.F.R. § 1.129(a) with an amendment, effectively equivalent to a continuation application; the PTO subsequently rejected the then-pending claims in a non-final Office Action on December 12, 2000. PTX-001.04505-06. Mr. Hyatt amended the claims on January 30, 2002. PTX-001.04268-69. The PTO issued a non-final Office Action rejecting all claims on September 7, 2004. PTX-001.04025-26.

         Mr. Hyatt timely noticed his appeal to the Board on March 7, 2005. PTX-001.03898. He filed his appeal brief on August 26, 2005, thereby closing prosecution. PTX-001.00928. In the course of its decisions on Mr. Hyatt's appeal and subsequent two motions for reconsideration, the Board reversed numerous grounds of rejection found by the examiner of the '398 claims and upheld others, concluding the PTO's administrative adjudication of the '398 application on July 8, 2009. A total of twenty-eight claims in the '398 application remain subject to Mr. Hyatt's §145 action before this Court: twenty-two rejected for lack of written description, and six because of anticipation.[12] A five-day trial began February 12, 2018, [13] during which new evidence was presented on each of the twenty-eight claims. See PTX-917.

         Case 09-1872 (the '639 application)

         Civil case 09-1872, also filed September 25, 2009, concerns patent application 08/431, 639 (the '639 application), entitled "Adaptive Memory System," which Mr. Hyatt filed on May 1, 1995. One of several applications flowing from Mr. Hyatt's 564-page[14] "600-family" specification, the '639 application is a continuation application of patent application serial number 07/279, 592, filed December 2, 1988. PTX-003.01380. The PTO entered a restriction requirement requiring Mr. Hyatt to elect one group of claims for examination drawn to one invention on October 19, 1995. PTX-003.01311-13. On July 24, 1996, the PTO rejected the claims in a non-final Office Action. PTX-085.00005. The PTO rejected the claims in a final Office Action dated May 19, 1999. PTX-085.00005. Mr. Hyatt timely noticed his appeal on October 19, 1999. PTX-085.00005.

         Mr. Hyatt filed his Appeal Brief oh April 18, 2000, thereby closing prosecution. PTX-085.00005. In the course of its decisions on Mr. Hyatt's appeal and three subsequent motions for reconsideration, the Board reversed numerous rejections by the examiner of the '639 claims and upheld others, concluding the PTO's administrative adjudication of the '639 application on July 8, 2009. PTX-085.00005. Mr. Hyatt filed suit under 35 U.S.C. § 145 to obtain a patent on claims on which the Board affirmed at least one ground of rejection on September 25, 2009. A total of fifty-eight claims in the '639 application remain subject to Mr. Hyatt's §145 action before this Court: fifty-two rejected for lack of written description, and six because of obviousness. See 09-1872 ECF No. 197 at 3;[15] 09-1872 ECF No. 220 at 1. A five-day trial began November 13, 2017, during which new evidence was presented on each of the disputed claims. See, e.g., PTX-901; PTX904.

         II. Legal Standard

         a. §145 and Kappos v. Hyatt

         Section 145 provides that a patent applicant dissatisfied with the Board's decision may sue the PTO in district court to determine the patentability of his alleged invention.[16] "The court may adjudge that such applicant is entitled to receive a patent for his invention, as specified in any of his claims involved in the decision of the [Board], [17] as the facts in the case may appear and such adjudication shall authorize the Director to issue such patent on compliance with the requirements of law." 35 U.S.C. §145.

         In 2012, in a case arising out of one of Mr. Hyatt's related applications with origins and ancestry largely in common with the applications at issue here, and also first litigated in this court, [18] the Supreme Court determined that district courts can consider new evidence that was not before the PTO during prosecution of a §145 plaintiffs antecedent patent application, and "the district court must make a de novo finding when new evidence is presented on a disputed question of fact." Kappos v. Hyatt, 566 U.S. 431, 434 (2012).[19] District courts may nevertheless exercise their discretion to "consider the proceedings before and findings of the Patent Office in deciding what weight to afford an applicant's newly-admitted evidence." Id. at 445 (quoting Hyatt v. Kappos, 625 F.3d 1320, 1335 (Fed. Cir. 2010).

         Section 145 cases remain "hybrid" actions after Kappos, see also SD3, LLC v. Dudas, )52 F.Supp.2d 97 (D.D.C. 2013), and APA deference is owed to Board decisions on claims for which no new evidence is presented. See Alberts v. Kappos, 917 F.Supp.2d 94, 104 (D.D.C. 1013) ("If the parties do not submit new evidence during a § 145 proceeding, 'the reviewing court must apply the APA's substantial evidence standard to Patent Office fact findings.') quoting Hyatt v. Kappos, 625 F.3d at 1336), aff'd sub nom. Alberts v. Lee, 552 Fed.Appx. 986 Fed. Cir. 2014).

         Like the plaintiffs, the PTO is free to introduce new evidence and arguments for rejecting i §145 plaintiffs claims on the merits in response to new evidence presented as to those claims. See also Troy v. Samson Mfctrn 'g Corp.,758 F.3d 1322 (Fed. Cir. 2014). All evidence concerning the claims at issue must be presented to the Court for full consideration, because section 145 ...


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