Federal Circuit Rules That The PTAB Cannot Adopt A New Claim Construction In A Final Written Decision Without Giving The Parties An Opportunity To Address That New Construction: SAS Institute Inc. v. ComplementSoft, LLC, PTAB Litigation Blog

The PTAB sometimes changes its claim constructions during the course of an inter partes review or a covered business method review. When it does so, according to the Federal Circuit’s recent holding in SAS Institute Inc. v. ComplementSoft, LLC, __ F. 3d __ (Fed. Cir. 2016), the Administrative Procedure Act requires the PTAB to give the parties sufficient notice and an opportunity to respond.

In its institution decision in SAS v. ComplementSoft, IPR2013-00226, the PTAB had found it reasonably likely that SAS would prevail in its challenge that dependent claim 4 was obvious. Reversing course in the final written decision, however, the PTAB concluded that SAS had not shown that the prior art disclosed “graphical representations of data flows” as recited in claim 4. The PTAB’s patentability finding regarding claim 4 was premised on a new construction for the “graphical representations of data flows” claim term that differed from the Board’s interpretation in the institution decision and that the PTAB adopted for the first time in the final written decision. Indeed, the PTAB readily acknowledged that it was applying a new claim construction that was “not addressed explicitly by either party.” On appeal to the Federal Circuit, SAS argued that the PTAB’s new construction was incorrect and that it was improper for the PTAB to change its interpretation of this claim term in the final written decision without affording the parties an opportunity to respond.

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