Intellectual Property > IP Newsflash > Federal Circuit Reverses PTAB for Improper Claim Construction
04 Jan '17

Demonstrating again that the “broadest reasonable interpretation” standard has limits, the Federal Circuit reversed the Patent Trial and Appeal Board’s decision that claims of two patents were unpatentable due to anticipation and obviousness. The dispute arose when MasterCard International filed two inter partes review petitions on the ’486 and ’988 patents—both owned by D’Agostino. Both patents related to methods of effecting secure credit card purchases by minimizing merchant access to credit card numbers. The issue on appeal was the proper construction of the “single merchant” limitation, which required that a transaction code from the account holder be limited to a single merchant. The PTAB determined that the term was broad enough to apply to credit card transactions identifying a particular chain of stores and, on that basis, held the patent claims anticipated and obvious in view of Cohen.

The Federal Circuit disagreed. The court noted that “[t]he protocol of giving claims their broadest reasonable interpretation . . . does not include giving claims a legally incorrect interpretation.” Slip op. 5 (ellipses in original). “[C]laims should always be read in light of the specification and teachings in the underlying patent . . . .” Id. Based on the specification and statements in the prosecution history, the court found that the PTAB departed from the “clear meaning” of “single merchant,” which describes a numerical limitation that limits use to only one merchant rather than describing the identity of the merchant. The court thus found that Cohen, which identified only a specific store instead of the number, did not disclose the claim limitation, and the court vacated the PTAB’s construction and unpatentability findings.

D’Agostino v. MasterCard Int’l Inc., 2016-1592, 2016-1593 (Fed. Cir. Dec. 22, 2016)