Trustid, Inc. v. NEXT CALLER, INC., Cross-Appellant 2020-1950, 2020-2028 Appeals from the United…

N OTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
TRUSTID, INC.,
Appellant
v.
NEXT CALLER, INC.,
Cross-Appellant
______________________
2020-1950, 2020-2028
______________________
Appeals from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in No. IPR2019-
00039.
______________________
Decided: September 27, 2021
______________________
BYRON L EROY P ICKARD, Sterne Kessler Goldstein &
Fox, PLLC, Washington, DC, argued for appellant. Also
represented by RICHARD M. BEMBEN, MICHAEL D. SPECHT .
SARAH CHAPIN C OLUMBIA, McDermott, Will & Emery
LLP, Boston, MA, argued for cross-appellant. Also repre-
sented by I AN BARNETT BROOKS , N ICOLE M. J ANTZI, P AUL
MICHAEL SCHOENHARD, Washington, DC.
______________________
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TRUSTID, INC. v. NEXT CALLER, INC. 2
Before REYNA, SCHALL , and STOLL , Circuit Judges.
SCHALL , Circuit Judge.
TRUSTID, Inc. (“TRUSTID”), the owner of U.S. Patent
No. 9,001,985 (“the ’985 patent”), appeals a final written
decision of the Patent Trial and Appeal Board (“Board”) de-
termining that certain claims of the ’985 patent were
shown to be unpatentable. Next Caller Inc. v. TRUSTID,
Inc., No. IPR2019-00039 (P.T.A.B. Feb. 24, 2020), Paper
No. 67, Corrected Non-Confidential Joint Appendix (“J.A.”)
1–92 (“Final Written Decision”). Next Caller, Inc. (“Next
Caller”) cross-appeals the Board’s determination that other
claims of the ’985 patent were not shown to be unpatenta-
ble. We affirm-in-part, vacate-in-part, and remand. In
particular, we affirm the Board’s decision finding claims 1–
7, 12–14, 16–18, and 22 of the ’985 patent unpatentable.
However, because the Board did not adequately explain the
reasoning for its non-obviousness determination as to
claims 8–11, 19, and 20 of the ’985 patent, we vacate the
Board’s decision with respect to those claims and remand
for further proceedings.
BACKGROUND
I.
The ’985 patent is directed to preventing call spoofing
by discovering and reporting the trustworthiness and cred-
ibility of calling party number information associated with
an incoming call. See ’985 patent Abstract, col. 1
l. 23–col. 2 l. 9. Claim 1 of the ’985 patent recites:
1. A method of determining a source origin confi-
dence metric of a calling party number or billing
number associated with an incoming call to a called
party telephonic device from a calling party tele-
phonic device, comprising:
receiving by an electronic system associated with
the called party telephonic device the calling party
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TRUSTID, INC. v. NEXT CALLER, INC. 3
number or billing number, wherein the electronic
system receives the calling party number or billing
number from the called party telephonic device;
after receiving the calling party number or billing
number and before the incoming call is answered,
gathering by the electronic system associated with
the called party telephonic device operational sta-
tus information associated with the calling party
number or billing number, and
determining by the electronic system associated
with the called party telephonic device the source
origin confidence metric for the calling party num-
ber or billing number.
Id. at col. 15 ll. 2–19.
Claim 4 depends from claim 1 and further recites “de-
termining by the electronic system associated with the
called party telephonic device whether the format of the
calling party number or billing number is valid.” Id. at
col. 15 ll. 29–32. Claim 8 also depends from claim 1 and
recites “adjusting . . . the source origin confidence metric
based on personal risk factors of an entity associated with
the calling party number or billing number.” Id. at col. 15
ll. 46–50.
II.
Next Caller petitioned for inter partes review (“IPR”) of
all of the claims of the ’985 patent after TRUSTID brought
suit against it for infringement. The petition presented
four grounds of invalidity, three of which are at issue in
this appeal. Ground 2 challenged claims 1–7, 12–18, 21,
and 22 as obvious over the combination of U.S. Patent Pub-
lication No. 2007/0201625 (“Martin”) in view of U.S. Patent
Publication No. 2007/0081648 (“Abramson”). Grounds 3
and 4 challenged claims 8–11, 19, and 20 as obvious over a
combination of Martin, and then Martin with Abramson,
both in view of U.S. Patent No. 7,912,192 (“Kealy”).
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TRUSTID, INC. v. NEXT CALLER, INC. 4
The Board instituted IPR and in due course issued the
Final Written Decision. In its decision, the Board deter-
mined that claims 1–7, 12–14, 16–18, and 22 were un-
patentable because they would have been obvious in view
of the combination of Martin and Abramson.1 J.A. 90. In
its analysis for the “operational status information” claim
element of independent claims 1 and 13, the Board dis-
cussed Abramson’s teaching of “gathering and using in its
checks information that is the same as that gathered and
used in the ’985 [p]atent.” Id. at 55, 65. When addressing
the “source origin confidence metric” element of independ-
ent claims 1 and 13, the Board relied on an embodiment set
forth in Abramson ¶ 74 that was not explicitly set forth in
Next Caller’s petition. Compare id. at 41–42, with id.
at 192–95. Finally, the Board also found that Martin
taught the limitations of dependent claim 4, citing Martin’s
teaching of “using the call source identification information
transmitted by the telephone system (typically between the
first and second ring of a call) to make decisions as to how
to process the call and process[ing] valid calls.” Id. at 70
(citing Martin ¶ 6).
As noted, the Board determined that Next Caller had
not shown claims 8–11, 19, and 20 to be unpatentable. The
Board rejected Next Caller’s argument that Kealy’s teach-
ing of reducing a trust rating based on complaints renders
obvious the claim limitation “adjusting . . . the source
origin confidence metric based on personal risk factors” of
claim 8. Id. at 87. The Board stated that Next Caller “[did]
not explain how Kealy’s complaints are ‘personal risk fac-
tors’” and did “not show[ ] why or how a person having or-
dinary skill in the art would have modified the Martin and
Abramson combination with Kealy to perform the further
1 The Board held claims 15 and 21 had not been
shown to be unpatentable. Those claims are not at issue
on appeal.
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TRUSTID, INC. v. NEXT CALLER, INC. 5
step of ‘adjusting . . . the source origin confidence metric
based on personal risk factors.’” Id. at 87–88.
TRUSTID sought rehearing of the Board’s determina-
tion with respect to claims 1–7, 12–14, 16–18, and 22, ar-
guing that the Board erroneously relied on Abramson as
teaching the claimed “operational status information”
when Next Caller had relied on Martin for this claim ele-
ment. J.A. 952–55. The Board denied rehearing, conclud-
ing that the petition “identifies disclosures of both Martin
and Abramson relied upon for the elements of the claims,
including ‘operational status information.’” J.A. 98–99.
TRUSTID and Next Caller timely appealed and cross-
appealed, respectively. We have jurisdiction under
28 U.S.C. § 1295(a)(4)(A).
D ISCUSSION
I.
We review the Board’s legal determinations, including
obviousness, de novo, and its underlying factual findings
for substantial evidence. Belden Inc. v. Berk-Tek LLC,
805 F.3d 1064, 1073 (Fed. Cir. 2015). A finding is sup-
ported by substantial evidence if a reasonable mind might
accept the evidence as adequate to support the finding.
Consol. Edison Co. v. NLRB, 305 U.S. 197, 229 (1938).
We review the Board’s decision for compliance with the
Administrative Procedure Act (“APA”) de novo. We must
“hold unlawful and set aside agency action, findings, and
conclusions found to be . . . arbitrary, capricious, an abuse
of discretion, or otherwise not in accordance with law,”
“without observance of procedure required by law,” or “un-
supported by substantial evidence.” 5 U.S.C. § 706.
Whether a ground the Board relied upon was new, requir-
ing a new opportunity to respond, is a question of law that
we review de novo. In re NuVasive, Inc., 841 F.3d 966, 970
(Fed. Cir. 2016).
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TRUSTID, INC. v. NEXT CALLER, INC. 6
II.
We begin with TRUSTID’s appeal. TRUSTID makes
three arguments, which we address in turn.
A.
TRUSTID’s first argument is that the Board violated
the APA in the Final Written Decision by relying on
Abramson to teach the claimed “operational status infor-
mation” element of independent claims 1 and 13, when
Next Caller’s petition, the Board’s institution decision, and
a decision of the Board denying rehearing of the institution
decision had relied solely on Martin for this claim element.
TRUSTID Br. 9–14, 25–29. In making this argument,
TRUSTID relies on EmeraChem Holdings, LLC
v. Volkswagen Group of America, Inc., 859 F.3d 1341
(Fed. Cir. 2017), where our court held the Board’s final
written decision violated the APA because it relied on a dif-
ferent reference than that relied upon in the petition or the
institution decision. TRUSTID separately argues that
there is no evidence in the record for the Board to find that
Martin teaches or makes obvious the claimed “operational
status information.” TRUSTID Br. 28–29.
In response, Next Caller argues that the Board found
that Martin alone teaches “operational status infor-
mation,” that that finding is supported by substantial evi-
dence, and that the Board’s finding that Abramson also
taught that element was “nothing more than a permissible
identification of an alternative basis.” Next Caller Br. 22,
34–37. We agree.
In the Final Written Decision, in its analysis for the
“operational status information” element of claim 1, the
Board began by noting the argument Next Caller made in
the petition, including Next Caller’s citations to Martin
and to a declaration of Next Caller’s expert, Mr. James
Geier (“Geier Decl.”):
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TRUSTID, INC. v. NEXT CALLER, INC. 7
Petitioner points to Martin’s teaching of central
monitoring station 100 processing status bits
210–330 if the aforementioned match is found be-
tween the received caller ID information 75 and in-
formation 200. Pet. 31–34 (citing, e.g., [Martin]
¶¶ 6, 27, Figs. 1, 2, 5; [Geier Decl.] ¶¶ 92–97). Pe-
titioner also points to Martin’s teaching of exem-
plary status bits 210–330. Pet. 13–14, 32 n.10
(citing, e.g., [Martin] ¶¶ 21–23, 28; [Geier Decl.]
¶¶ 50–51, 98).
J.A. 53. The Board then stated:
We agree with Petitioner and credit and give
weight to the testimony of Mr. Geier because Peti-
tioner’s contentions and Mr. Geier’s testimony are
consistent with the evidence of record. For in-
stance, Martin teaches if the received caller ID in-
formation 75 matches caller ID information 200
stored in memory 140, processing circuits 130 read
status bits 210–330. [Martin] ¶¶ 6, 27, Fig. 5.
J.A. 54. We agree with Next Caller that this constitutes a
finding by the Board that Martin teaches the claimed “op-
erational status information.”
We also agree with Next Caller that this finding is sup-
ported by substantial evidence. Martin explains that “the
processing circuits 120 read status bits 210–330 associated
with the caller ID information 200.” Martin ¶ 27; see also
id. at ¶¶ 6, 21–23, 28, Figs. 1, 2, 5. Further, Mr. Geier ex-
plained that Martin’s “status information comprises vari-
ous forms of information as illustrated in Figure 2,” which
shows status bits 210–330. J.A. 1304–05 ¶ 97. And accord-
ing to Mr. Geier, a person of ordinary skill in the art “would
have understood that Martin’s status information is com-
posed of ‘operational status information.’” J.A. 1305 ¶ 98;
see also J.A. 1282 ¶¶ 50–51; J.A. 1302 ¶ 92; J.A. 1304
¶¶ 95–97.
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TRUSTID, INC. v. NEXT CALLER, INC. 8
It is true, however, that the Board then pointed to
Abramson’s teaching of “gathering and using in its checks
information that is the same as that gathered and used in
the ’985 patent.” J.A. 55. Its reliance on Abramson as a
supplemental teaching of this claim element for claim 1, in
view of its prior finding that Martin teaches the element,
was, at most, harmless error. See Yeda Rsch. v. Mylan
Pharmas. Inc., 906 F.3d 1031, 1042 (Fed. Cir. 2018) (con-
cluding that the Board’s reliance on a reference, to the ex-
tent reliance on that reference was improper, was a
harmless error because substantial evidence otherwise
supported the Board’s conclusion).
We reach the same conclusion for independent
claim 13. Although the Board’s discussion of the “opera-
tional status information” element for that claim pertained
primarily to Abramson, the Board noted that Next Caller
“relie[d] on the same teachings discussed with respect to
claim 1.” J.A. 65. The Board then referred back to its
claim 1 analysis (e.g., “see supra III.E.4.c.”), which con-
cluded that Martin taught this element, before additionally
finding that Abramson taught the claimed “operational
status element.” Id. at 65–66. As with claim 1, the Board’s
reliance on Abramson as a supplemental teaching of this
claim element for claim 13 was, at most, harmless error.
B.
TRUSTID’s second argument is that the Board violated
the APA when it relied on a different embodiment of
Abramson to teach the claimed “source origin confidence
metric” than Next Caller had relied upon in its petition.
Specifically, TRUSTID contends that it did not have notice
and an opportunity to respond to the theory that Abram-
son’s processing of tasks 501 through 503, as illustrated in
Abramson’s Figure 5 and described in ¶ 74, generates a
number within a range of zero to three that corresponds to
the claimed “source origin confidence metric.” TRUSTID
Br. 30–31; TRUSTID’s Resp. and Reply Br. 7–9.
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TRUSTID, INC. v. NEXT CALLER, INC. 9
Next Caller responds that TRUSTID had the oppor-
tunity to respond, and did respond, to Next Caller’s posi-
tion, which was consistent with the Board’s findings on this
claim element. Next Caller Br. 38–41.
“The notice and opportunity to be heard provisions of
the APA have been applied ‘to mean that an agency may
not change theories in midstream without giving respond-
ents reasonable notice of the change’ and ‘the opportunity
to present argument under the new theory.’” Genzyme
Therapeutic Prods. L.P. v. Biomarin Pharm. Inc., 825 F.3d
1360, 1366 (Fed. Cir. 2016) (quoting Belden, 805 F.3d
at 1080). We agree with Next Caller that there was no APA
violation here because TRUSTID received adequate notice
and an opportunity to be heard.
In the petition, Next Caller pointed to Abramson’s
teaching of performing three tests (tasks 501, 502, and 503)
that pertain to characteristics of the calling party’s termi-
nal. J.A. 192–94 & nn. 6, 7 (citing, inter alia, Abramson
¶¶ 66–72, 75–82, and Fig. 5; J.A. 1299 (Geier Decl.)
¶¶ 76–83). If all three tests are passed, then call privileges
are granted; if any test is not passed, the call is terminated.
Id. at 194–95 n.7. Next Caller’s petition argued that this
teaches a “source origin confidence metric” if the term is
broad enough to cover a binary result. In the alternative,
Next Caller stated:
A [person of skill in the art] would have found [sic]
obvious to modify Abramson to assess each charac-
teristic and assign a probabilistic score—if, e.g.,
only two of three tasks resulted in a “yes.” Under
such circumstances, Abramson could advanta-
geously gain greater flexibility in evaluating call-
ers—assigning weight to certain characteristics
and determining validity based on a surpassed
threshold. These modifications would have been
straightforward to a [person of skill in the art], as
they would require minor changes to the
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TRUSTID, INC. v. NEXT CALLER, INC. 10
programming of Martin’s and Abramson’s proces-
sors, and would have yielded predictable results.
[Geier Decl.] ¶¶ 84–86.
J.A. 194–95 n.7. In its response to the petition, TRUSTID
disputed that Abramson taught or rendered obvious the
claimed “metric.” J.A. 384–85, 389–92. In reply, Next
Caller explained that “Abramson at minimum renders ob-
vious the claimed metric,” cited ¶¶ 65–73 of Abramson, and
rebutted TRUSTID’s arguments with reference to Abram-
son’s ¶ 74. J.A. 509. Next Caller stated:
Abramson suggests performing a calculation using
known information to decide whether to grant priv-
ileges. . . . [A person of ordinary skill in the art]
would have understood one way to address the sit-
uation where privileges could still be granted de-
spite not having all “yeses” would have been to
weigh/score the results and decide whether to
grant access based on the score. Such a score could
be determined in the same manner as described
above.
Id. at 509–10 (footnote omitted); see also J.A. 506–07 (dis-
cussing Martin and explaining that “[o]ne obvious manner
of making that determination would have been to weigh
each of the status bits/bytes and then output a metric (e.g.,
number in a range) based on assigned weights of the status
bits/bytes that could be used to determine whether the call
is valid.” (footnote omitted)).
In its sur-reply, TRUSTID cited ¶ 74 of Abramson to
show that “because Abramson already discloses a mecha-
nism for handling the situation where one of the tasks re-
turns an unexpected result,” a person of ordinary skill in
the art would not have modified Abramson to generate a
metric based on considering two of three tasks. J.A. 627.
TRUSTID pointed to cross-examination testimony of
Mr. Geier, which it contended showed that Mr. Geier’s
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TRUSTID, INC. v. NEXT CALLER, INC. 11
opinions regarding weighing status bits/bytes and output-
ting a score/metric were “general.” J.A. 626.
In the Final Written Decision, the Board construed
“source origin confidence metric” to exclude binary meas-
urements. J.A. 29–30, 40. Citing to ¶ 74 of Abramson, the
Board stated:
Also consistent with Petitioner’s contentions and
Mr. Geier’s testimony, Abramson further describes
an alternative embodiment in which “exchange 205
might still grant privileges, or a limited set of priv-
ileges, even if at least one of the results is unex-
pected, indeterminate, or unknown-for example,
the received telephone type is unexpected but the
received signaling protocol is as expected.”
J.A. 41 (quoting Abramson ¶ 74) . The Board contin-
ued:
Abramson discloses three separate tasks, i.e., tasks
501, 502, and 503, each [of] which may result in
“yes” or “no.” [Abramson] ¶¶ 66–74, Fig. 5. Pro-
cessing of tasks 501 through 503 illustrated in the
flowchart depicted in Figure 5 results in a number
that is a measurement of characteristics that
agreed with what was expected. Id. That number
is within a range of “0” through “3.” Id.
J.A. 41–42. The Board credited Mr. Geier’s testimony that
a person of ordinary skill in the art “would have found [sic]
obvious to modify Abramson to access each characteristic
and assign a probabilistic score—if, e.g., only two of three
tasks resulted in a ‘yes.’” J.A. 42 (emphasis omitted) (quot-
ing J.A. 1300 (Geier Decl.) ¶ 86). While TRUSTID’s expert,
Dr. Leonard J. Forys, disagreed with Mr. Geier, the Board
“credit[ed] and [gave] significant weight to the testimony of
Mr. Geier over that of Dr. Forys” because it found Mr.
Geier’s testimony to be “consistent with the evidence of rec-
ord,” specifically, Abramson ¶ 74 itself. J.A. 43.
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TRUSTID, INC. v. NEXT CALLER, INC. 12
We disagree with TRUSTID that it did not have notice
and an opportunity to respond to the theory the Board re-
lied upon. Although presented in different terms, the
Board’s finding that Abramson’s tasks 501 through 503
could be processed to result in a number that is a measure-
ment of characteristics and that is within a range of “0”
through “3” is not an altogether different theory from that
presented in the petition or in Next Caller’s reply. See Ar-
threx, Inc. v. Smith & Nephew, Inc., 935 F.3d 1319, 1326–
28 (Fed. Cir. 2019) (“[T]he mere fact that the Board did not
use the exact language of the petition in the final written
decision does not mean it changed theories in a manner in-
consistent with the APA and our case law.”). As noted, the
petition indicated that a person of ordinary skill in the art
“would have found [sic] obvious to modify Abramson to as-
sess each characteristic and assign a probabilistic score—
if, e.g., only two of three tasks resulted in a ‘yes.’” J.A. 194–
95 n.7. In reaching its conclusion, moreover, the Board
cited the same portions of Abramson cited in the petition
and in Next Caller’s reply, to which TRUSTID was given
the opportunity to respond, and did in fact respond. We
therefore reject TRUSTID’s argument that the Board’s Fi-
nal Written Decision violated its procedural rights with re-
spect to the “source origin confidence metric” claim element
of independent claims 1 and 13.
C.
Third, TRUSTID argues that the Board’s finding that
Martin teaches the limitations of dependent claim 4 is not
supported by substantial evidence. Claim 4 recites “deter-
mining by the electronic system associated with the called
party telephonic device whether the format of the calling
party number or billing number is valid.” ’985 patent
col. 15 ll. 29–32.
TRUSTID contends that Martin compares information
about the incoming call, such as its caller ID information,
to a list of numbers stored in its memory, and processes a
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TRUSTID, INC. v. NEXT CALLER, INC. 13
call only when there is a match. According to TRUSTID,
however, “[c]hecking to see whether two numbers
match . . . is not determining whether a telephone number
is properly formatted.” TRUSTID Resp. and Reply Br. 11;
see also TRUSTID Br. 23–24, 31–33. TRUSTID contends
that Mr. Geier conceded that if there is no match “you
wouldn’t know something about formatting.” TRUSTID
Br. 33 (quoting J.A. 4649).
Next Caller responds that the Board’s findings with re-
spect to claim 4 are supported by substantial evidence, in-
cluding Martin ¶¶ 6 and 27, and the testimony of
Mr. Geier. Next Caller Br. 41–43. Next Caller points to
Mr. Geier’s declaration testimony that a person of ordinary
skill in the art “would have understood that if there was no
match, one reason for that ‘no match’ is that the format of
the call source identification is not valid. Similarly, a
match would indicate that the format is valid.” Id. at 42
(quoting J.A. 1313 (Geier Decl.) ¶ 123). Alternately, Next
Caller asserts, Mr. Geier explained that a person of ordi-
nary skill would have found the limitation obvious. Id.
We agree with Next Caller. Martin discloses checking
the validity of an incoming call, and processing only valid
calls:
The central monitoring station will process the call
by checking if the call source identification infor-
mation matches call source identification infor-
mation stored in memory, and it will check status
data that may be associated with the call source
identification information, also stored in memory,
to determine if the call should be disconnected,
transferred, or connected to the receiver. Since the
receiver only processes valid (legitimate) local
alarm system reports, the lines are less likely to be
tied up by invalid alarm calls and the efficiency of
the alarm answering process is increased.
. . .
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TRUSTID, INC. v. NEXT CALLER, INC. 14
. . . [T]he processing circuits 130 look for a match
between the received caller ID information 75 and
the caller ID information 200 stored in memory
140. If a match is not found, the processing circuits
130 cause the switching circuits 120 to connect the
call to the invalid alarm call station 195. . . . If
there is a match, the processing circuits 120 read
the status bits 210–330 associated with the caller
ID information 200. If the processing circuits 120
determine the call is a valid alarm call, the pro-
cessing circuits 130 cause the switching circuits
120 to connect the call to the receiver 150 and
transmit the status information 145.
Martin ¶¶ 6, 27. Mr. Geier explained that a person of skill
in the art “would have understood that if there was no
match, one reason for that ‘no match’ is that the format of
the call source identification is not valid.” J.A. 1313 (Geier
Decl.) ¶ 123. That a “no match” determination does not
necessarily provide information about whether the format
is valid does not mean Martin does not teach performing
the claimed “determining” when it does find a match. As
Mr. Geier explained, “a match would indicate that the for-
mat is valid.” Id.2
Accordingly, we agree with Next Caller that the
Board’s finding that Martin teaches claim 4 is supported
by substantial evidence.
III.
We turn next to Next Caller’s cross-appeal. Next Caller
argues that the Board erred when it determined that
2 As we have explained, “a prior art product that
sometimes, but not always, embodies a claimed method
nonetheless teaches that aspect of the invention.” Hewlett-
Packard Co. v. Mustek Sys., Inc., 340 F.3d 1314, 1326 (Fed.
Cir. 2003).
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TRUSTID, INC. v. NEXT CALLER, INC. 15
claims 8–11, 19, and 20 of the ’985 patent had not been
shown to be unpatentable. Next Caller takes issue with
the Board’s rationale with respect to those claims, urging
that it was insufficient under In re NuVasive, Inc., 842 F.3d
1376 (Fed. Cir. 2016), and that the Board disregarded rel-
evant findings regarding Kealy that had been made by the
patent examiner during examination of the application
that issued as the ’985 patent. Next Caller Br. 24–31. Next
Caller contends that the Board erred when it failed to defer
to the examiner’s previous findings and because it did not
address the petition’s evidence or articulate any rationale
for rejecting it. Id.
TRUSTID responds that Next Caller waived or for-
feited its arguments regarding Kealy by failing to request
that the Board defer to the examiner’s findings. TRUSTID
Resp. and Reply Br. 23–26. TRUSTID also argues that
“there is no legal authority requiring the Board to defer to
original prosecution in an IPR.” Id. at 26. Further,
TRUSTID contends that the Board’s reasoning was suffi-
ciently articulated and supported by substantial evidence.
Id. at 29–33.
During examination of the application that ultimately
issued as the ’985 patent, the examiner issued an Office
Action in which the application claims that correspond
with issued claims 8–10, 19, and 20 were rejected as obvi-
ous over a combination of references including Kealy. The
Office Action stated:
[U.S. Patent No. 5,963,625 to Kawecki et al.
(“Kawecki”)] teaches all subject matters as claimed
above, except for the features of adjusting the
source origin confidence metric including one or
more fraud score, risk score, etc.; storing and re-
trieving them from an external database. However
[Kealy] teaches trust ratings embedded in certifi-
cates of calling device [sic], and a method of man-
aging trust ratings based on fraud and risk factors
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TRUSTID, INC. v. NEXT CALLER, INC. 16
such as accumulated complaints, etc. When a
quantity of accumulated complaints exceeded a
given threshold or no complaints in a given time, a
trust rate of a given calling device is adjusted such
as reduced or increased (col. 14, line 24 through col.
15, line 16).
Therefore, it would have been obvious to one of
ordinary skill in the art at the time the invention
was made to incorporate the use of the features of
adjusting the source origin confidence metric in-
cluding one or more fraud score, risk score, etc.;
storing and retrieving them from an external data-
base, as taught by Kealy, into [sic] view of Kawecki
in order to certify the calling device for calls from
unwanted “junk” phone calls.
J.A. 1120–21.
Next Caller provided a copy of the office action with its
petition. J.A. 174. Next Caller also quoted the examiner’s
statement of what Kealy teaches, including the examiner’s
citation to column 14, line 24, through column 15, line 16,
of Kealy. Id. In its claim charts and its accompanying note,
Next Caller pointed to Kealy’s teaching of “reducing a trust
rating of a calling party based on the number of complaints
received,” J.A. 210 n. 22, and cited Kealy itself and
Mr. Geier’s explanation of Kealy. See J.A. 209–12 & n. 22
(citing Kealy at Abstract, col. 3 ll. 28–36, col. 14 ll. 13–20,
and col. 14 l. 58–col. 15 l. 6; Geier Decl. ¶¶ 147–51).
In addition, in the petition, Next Caller asserted that
Kealy’s teachings of trust ratings would have been benefi-
cial “to further bolster Martin’s [and Abramson’s] incoming
call processing system[s]” and “particularly beneficial to
Martin’s assessment of VoIP calls,” and such a motivation
would have had the benefit of “reduc[ing] costs associated”
with such calls. Id. at 187, 188. The petition stated:
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TRUSTID, INC. v. NEXT CALLER, INC. 17
A [person of ordinary skill in the art] would have
found it obvious and straightforward to use Kealy’s
advantageous teachings of trust ratings to further
assess the legitimacy of an alarm call in Martin’s
system. A [person of ordinary skill in the art]
would have understood how to make the modifica-
tion to Martin’s program, and such a modification
would have been routine and predictable. Indeed,
Martin’s status information is readily adaptable
and could maintain trust ratings as part of its “ad-
ditional information.” [Martin ¶ 23], Fig. 2[,]
[Geier Decl.] ¶ 67.
J.A. 188; see also id. at 188–89 (citing Geier Decl. ¶ 69).
As noted, in the Final Written Decision, the Board re-
jected Next Caller’s argument that Kealy’s teaching of re-
ducing the trust rating based on complaints rendered
obvious the claim limitation of adjusting the source origin
confidence metric based on personal risk factors, stating
that Next Caller “[did] not explain how Kealy’s complaints
are ‘personal risk factors’” and did “not show[ ] why or how
a person having ordinary skill in the art would have modi-
fied the Martin and Abramson combination with Kealy to
perform the further step of ‘adjusting . . . the source origin
confidence metric based on personal risk factors.’”
J.A. 87–88. The Board made this statement after first re-
citing certain of Next Caller’s arguments, and then block
quoting column 14, line 58, through column 15, line 6 of
Kealy.
We agree with TRUSTID that there is no legal basis for
the proposition the Board must defer to the examiner’s pre-
vious findings in deciding the merits of an IPR. Indeed,
“the Supreme Court has characterized the ‘congressional
objective’ of the IPR process as ‘giving the Patent Office sig-
nificant power to revisit and revise earlier patent grants.”
Skky, Inc. v. MindGeek, s.a.r.l., 859 F.3d 1014, 1021
(Fed. Cir. 2017) (quoting Cuozzo Speed Techs., LLC v. Lee,
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TRUSTID, INC. v. NEXT CALLER, INC. 18
136 S.Ct. 2131, 2139–40 (2016)). That said, we agree with
Next Caller that the Board’s analysis with respect to
Kealy’s teachings and motivation to combine were insuffi-
cient. “[T]he Board is obligated to provide an administra-
tive record showing the evidence on which the findings are
based, accompanied by the agency’s reasoning in reaching
its conclusions.” Alacritech, Inc. v. Intel Corp., 966 F.3d
1367, 1370 (Fed. Cir. 2020) (quoting TQ Delta, LLC v. Cisco
Sys., Inc., 942 F.3d 1352, 1358 (Fed. Cir. 2019)). “We do
not require ‘perfect explanations,’ and ‘we will uphold a de-
cision of less than ideal clarity if the agency’s path may rea-
sonably be discerned.’” Id. at 1370–71 (quoting NuVasive,
842 F.3d at 1382–83). “We do, however, require that the
Board’s own explanation be sufficient ‘for us to see that the
agency has done its job.’” Id. (quoting NuVasive, 842 F.3d
at 1383). Here, the Board merely partially reiterated and
summarily rejected Next Caller’s arguments without ex-
planation. This is not sufficient under the APA and our
precedent. NuVasive, 842 F.3d at 1383 (explaining that the
Board cannot “summarize and reject arguments without
explaining why [it] accepts the prevailing argument.”).
Thus, while there is no legal basis to require that the Board
have deferred to the examiner’s reasoning, the Board did
need to have provided its own reasoning.
CONCLUSION
For the reasons set forth above, we affirm the Board’s
decision finding claims 1–7, 12–14, 16–18, 21, and 22 of the
’985 patent unpatentable. We vacate the Board’s non-obvi-
ousness determination as to claims 8–11, 19, and 20 of the
’985 patent and remand for further proceedings consistent
with this opinion.
AFFIRMED-IN-PART, VACATED-IN-PART, AND
REMANDED
COSTS
No costs.
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