Itron Earns Review of Smart Meter Patent

  • An inter partes review is an administrative proceeding that asks the U.S. Patent and Trademark Office to invalidate a U.S. Patent. These reviews are commonly used by patent litigation defendants in an attempt to invalidate patent claims that have been asserted against them.
  • Itron requested inter partes review of a patent owned and asserted by Smart Meter Technologies. Itron’s request was granted.

The Patent Trial and Appeal Board has agreed to review the validity of a smart utility meter patent owned by Smart Meter Technologies, Inc. (“SMT”). The validity challenge was filed by Itron, Inc., a manufacturer of smart utility meters and provider of grid monitoring and control technologies. In a decision dated October 11, 2017, the Board found that Itron had brought forth sufficient evidence of the patent’s invalidity to warrant a review proceeding.

The challenged patent is U.S. Patent No. 7,058,524 (“the ‘524 Patent”), which generally describes a utility meter that converts a measured power consumption to Internet Protocol (IP) data and “autonomously” transmits the data to an external network. Figure 1 of the ‘524 Patent illustrates a residential metering system (10) having a power meter (35) coupled to a processor (20) and a transceiver antenna (15). The power meter (35) measure power consumption (as derived by monitoring electrical current fluctuations) in the power line (50).

SMT claims that the ‘524 Patent is an early building block of smart meter and smart grid technology.

 

To obtain a patent, a patent applicant must demonstrate to the US Patent and Trademark Office (USPTO) that their claimed invention is both new and non-obvious over existing technology. If the applicant is successful, the patent is granted. Third parties may challenge granted patents by returning to the USPTO and requesting a review of the patent’s validity. These reviews are conducted by the Patent Trial and Appeal Board and are known as Inter Partes Reviews. Challengers typically bring evidence before the Board to show that the patented invention was previously known in the technological field and therefore no patent should have been granted.

When a challenger requests review of a patent, the Board initially looks at the evidence and determines whether a review is warranted. If so, the Board “institutes” a review of the patent. During the review process, both the patent owner and the challenger have an opportunity to make arguments to the Board, and the Board then issues a final decision on the validity of the patent.

In the Itron case, Itron was successful in convincing the Board that it has sufficient evidence to begin the review process. Itron relies on an earlier U.S. Patent Publication as demonstrating that the ‘524 Patent was merely an obvious improvement over existing technology and therefore should not have been granted. Itron specifically relies on U.S. Patent Publication 2002/0161536 to inventor Sung L. Suh (“Suh”). In the Board’s characterization, Suh describes “an internet ready electronic power meter with automatic reporting capabilities [for] recording electrical power usage [ ] and periodically transmitting utility usage reports to a remote site using [the] internet.”

Now that the Board has formally begun the review process of the ‘524 Patent, SMT will have an opportunity to respond to the evidence submitted by Itron. It seems a key point of contention will be whether the meter described by Suh transmits data “autonomously,” as claimed by SMT in the ‘524 Patent. If the Board finds that Suh’s meter behaves autonomously, then it will be more likely to declare at least some portion of the ‘524 Patent invalid.

The ‘524 Patent is noteworthy because SMT has asserted the patent in an infringement lawsuit against Duke Energy. In that lawsuit, which is in progress, SMT alleges that Duke’s effort to modernize its grid – and specifically Duke’s installation of “advanced power meters” at residences – infringes the ‘524 Patent and entitles SMT to monetary damages.

It is unclear whether Itron has filed its challenge against the ‘524 Patent as an indemnifying party to Duke Energy or, more generally, as a party in the smart meter business that is concerned with SMT’s assertion of the ‘524 Patent. SMT is a patent licensing entity, meaning SMT is not a market competitor to Itron but rather attempts to license its patented technology in this field.

 

Post originally drafted October 18, 2017.