| Sean S. KimChristie Matthaei

Before Newman, O’Malley, and Wallach.  Appeal from the Patent Trial and Appeal Board.

Summary: Diligence requires “reasonably continuous diligence” and is not negated if the inventor works on improvements and evaluates alternatives while developing an invention. 

LG Electronics, Inc. (LGE) requested an Inter Partes Review of patents owned by ATI Technologies ULC (ATI).  ATI argued it conceived of its invention – a computer-implemented system that specified how a three-dimensional image is generated and presented on a two-dimensional screen – and constructively reduced it to practice before the asserted prior art.  ATI presented a declaration purporting to show evidence of conception, reduction of practice, and diligence for its patents.  The PTAB agreed with ATI that the date of conception was established before the primary reference dates.  However, the PTAB nevertheless invalidated ATI’s patents finding that ATI did not establish actual reduction to practice and diligence.  The PTAB noted that ATI’s work included designing an optional unclaimed feature and that ATI did not provide a way for the PTAB to determine whether unexplained lapses have not occurred.

The Federal Circuit reversed and found that the PTAB erred in its application of the law of diligence when it required “continuous reasonable diligence” rather than “reasonably continuous diligence,” which is the established standard for diligence.  Noting ATI’s almost 1300 pages of records including metadata, document logs, and folder histories, the Federal Circuit noted that the documents corroborated reasonably continuous diligence.  The Federal Circuit added that working on improvements and evaluating alternatives while developing an invention does not negate diligence.  The purpose of the diligence requirement is to assure that the invention was not abandoned or unreasonably delayed, and the PTAB did not cite or provide any evidence supporting a conclusion that ATI had abandoned or unreasonably delayed the invention.

Editor: Paul Stewart