Elbit loses appeal at CAFC

The outcome



Appellant Elbit Systems of America, LLC (“Elbit”)
sought inter partes review of various claims of Appellee
Thales Visionix, Inc.’s (“Thales”) U.S. Patent No.
6,474,159 (“the ’159 patent”). The U.S. Patent and
Trademark Office’s Patent Trial and Appeal Board
(“PTAB”) issued a final written decision, see Elbit Sys. of
Am., LLC v. Thales Visionix, Inc., No. IPR2015-01095
(P.T.A.B. Oct. 14, 2016) (J.A. 1–25), finding that, inter
alia, Elbit failed to demonstrate by a preponderance of the
evidence that claims 3–5, 13, 24–28, 31, and 34 (“the
Asserted Claims”) of the ’159 patent would have been
obvious over U.S. Patent No. 4,722,601 (“McFarlane”) in
combination with two other prior art references, see
J.A. 2, 4−5.

Elbit appeals. We have jurisdiction pursuant to 28
U.S.C. § 1295(a)(4)(A) (2012). We affirm.


The CAFC noted:


Substantial evidence supports the PTAB’s conclusion
of nonobviousness. It is undisputed that the method of
calculating the “relative angular rate signal” taught in the
’159 patent “is not explicitly disclosed” in the prior art
because the prior art and the Asserted Claims employ
different steps to calculate the orientation or position of a
moving object relative to a moving reference frame.




Of experts:


Elbit’s expert attempts to undermine this testimony
by arguing that the two- and three-step methods are
“mathematically equivalent” and that “there is no practical
difference” between them. J.A. 2034. However, the
PTAB determined that Elbit’s expert’s testimony was
“unsupported” and entitled to “little weight” because he
did not address or account for the recited relative angular
rate signal limitation “anywhere in his opinion.” J.A. 17–
18. “The PTAB [i]s entitled to weigh the credibility of the
witnesses,” Trs. of Columbia Univ. v. Illumina, Inc., 620
F. App’x 916, 922 (Fed. Cir. 2015); see Inwood Labs., Inc.
v. Ives Labs., Inc., 456 U.S. 844, 856 (1982) (“Determining
the weight and credibility of the evidence is the special
province of the trier of fact.”), and, thus, we decline to
disturb these credibility determinations here



Of waiver:


Elbit conceded that it failed to argue that substantial
evidence does not support the PTAB’s decision to credit
Thales’s explanation of the nonobviousness of the twostep
method, see Oral Arg. at 27:30–32 (acknowledging
that they “did not make . . . a legal argument” that the
PTAB’s decision is unsupported by substantial evidence),
which constitutes waiver, see Nan Ya Plastics Corp. v.
United States, 810 F.3d 1333, 1347 (Fed. Cir. 2016) (holding
that failure to present arguments under the operative
legal framework “typically warrants a finding of waiver”)



Calculus appears in footnote 5:


Pursuant to this principle, “as a matter of calculus,
the sum of integrals is equal to the integral of sums.”
J.A. 2144. According to Elbit, this principle dictates that
the same result will be reached whether data is “first
integrated, then subtracted” or “first subtracted, then
integrated,” such that “the order in which these steps are
performed does not matter.” Appellant’s Br. 3. As applied
to the ’159 patent, Elbit contends that the sum of
integrals principle renders the ’159 patent “no more than
a predictable variation of the prior art” and, thus, unpatentable.
Id. at 5 (citation omitted).





AND



“[w]e will not find
legal error based upon an isolated statement stripped
from its context.” Waymo LLC v. Uber Techs., Inc., 870
F.3d 1350, 1361 (Fed. Cir. 2017) (internal quotation
marks and citation omitted). As for whether a PHOSITA
“would understand that the sum of integrals principle
applies to all equations, including navigation equations,”
Appellant’s Br. 37 (capitalization omitted); see id. at 37–
41, Elbit fails to present any evidence supporting this
contention beyond attorney argument, see id. at 37–41,
and “[a]ttorney argument is not evidence” and cannot
rebut other admitted evidence, Icon Health & Fitness, Inc.
v. Strava, Inc., 849 F.3d 1034, 1043 (Fed. Cir. 2017). In
contrast, Thales’s expert testified that a PHOSITA could
have determined that it would be “mathematically inappropriate
or invalid” to apply the principle to the navigation
equations disclosed in the ’159 patent. J.A. 2143. In
sum, substantial evidence supports the PTAB’s determination
that the Asserted Claims would not have been
obvious to a PHOSITA.