Apple loses in MPH case; waiver issue

Apple Inc. (“Apple”) appeals from the final written decision of the Patent Trial and Appeal Board (the “Board”) holding that Apple failed to demonstrate that claims 1–16 of U.S. Patent 8,037,302 (the “’302 patent”) were unpatentable. See Apple Inc. v. MPH Technologies Oy, No. IPR2019- 00821, 2020 WL 5900607 (P.T.A.B. Oct. 5, 2020) (“Decision”). For the reasons provided below, we affirm.

Waiver arises

MPH responds that Apple failed to raise its claim construction arguments before the Board. MPH contends that Apple informed the Board that the only dispute before it was the application of the agreed-upon construction to the prior art. MPH thus argues that Apple’s failure to raise its claim construction arguments before the Board compels a finding of forfeiture. See In re Google Tech. Holdings LLC, 980 F.3d 858, 862–63 (Fed. Cir. 2020) (interpreting the U.S.P.T.O.’s waiver argument as a forfeiture argument). Additionally, MPH argues that the Board did not impose unnecessary restrictions into the establishing limitation. MPH contends that the Board properly adopted the parties’ agreed-upon construction of the establishing limitation, analyzed and applied the plain and ordinary meaning of the limitation, and found that Ahonen’s remote activation of a preexisting and inactive security association does not meet the establishing limitation of claim 1. We agree with MPH that, contrary to Apple’s position on appeal, Apple only disputed the application of the agreed construction to the prior art. In its reply brief to MPH’s response, Apple stated that construction of the establishing limitation was not at issue–only the factual application of the construction to Ahonen’s teachings. In response to questioning at the hearing concerning whether claim construction was in dispute, Apple maintained that the parties agreed on the construction of the establishing limitation and argued only about the application of the construction to Ahonen. Furthermore, Apple does not argue that the Board engaged in sua sponte construction or that there are exceptional circumstances that justify departing from the forfeiture principle. It is clear from the record that Apple chose not to characterize its dispute concerning the establishing limitation as a claim construction issue before the Board. Apple attempts here, in contrast, to recharacterize that same dispute as a construction issue deserving of de novo review. MPH’s expert’s declaration put Apple on notice that MPH was taking the position that a person of skill would understand the establishing limitation “to mean that the first secure connection is established as an active connection for immediate use, as opposed to an inactive connection reserved for later use.” See Decision, 2020 WL 5900607, at *6–7; J.A. 2028. With the knowledge of MPH’s position, Apple continued to maintain that there was no further dispute concerning construction of the establishing limitation. After the Board agreed with MPH and MPH’s expert, however, Apple changed its strategy and characterized the issue as a claim construction dispute. We do not encourage “suggesting or permitting, for strategic reasons, that [the Board] pursue a certain course, and later—if the outcome is unfavorable—claiming that the course followed was reversible error.” Google, 980 F.3d at 864 (internal quotation marks omitted). We conclude that Apple forfeited its arguments as to the construction of the establishing limitation because Apple failed to raise these legal arguments before the Board. In the absence of exceptional circumstances, we decline to address the merits of Apple’s proposed constructions. See id. at 862–63.