A Federal Circuit panel raised concerns on Friday about Ioengine LLC’s effort to overturn a Delaware federal jury’s decision invalidating its patents based on prior public use. The jury had found that Ioengine’s patents were anticipated by its own product, which had been on sale for more than a year before the company filed for patent protection.

Ioengine’s appeal hinges on whether its firmware upgrade, which was made available for the M-Systems Ltd. DiskOnKey, was truly used by customers or if it was merely offered but never utilized. The company contends that while the upgrade was available on M-Systems’ website and promoted by M-Systems, there is no evidence that anyone actually downloaded or used the firmware.

Judge Timothy Dyk pressed Ioengine’s counsel, Noah Leibowitz of Dechert LLP, asking why it wouldn’t be reasonable for the jury to infer that some of the hundreds of people who purchased the DiskOnKey thumb drive would have downloaded and used the upgrader, given that it was encouraged by Ioengine. Leibowitz responded that there was no direct evidence—such as download logs—indicating that the upgrader was used.

In contrast, Kerry Timbers of Sunstein LLP, representing Ingenico, argued that it was reasonable for the jury to infer that users who were encouraged to download and use the upgrader would have done so. Timbers pointed out that detailed instructions were provided on M-Systems’ website, which would have made it clear how to use the upgrade.

The panel also discussed whether Ioengine's prior Patent Trial and Appeal Board (PTAB) challenge should preclude Ingenico from using certain evidence regarding the sale or use of the upgrader. Judge Sharon Prost expressed skepticism about the relevance of the PTAB challenge, noting that the purpose of the Inter Partes Review (IPR) was to examine prior art and not to assess whether the product had been sold or used.

The judges also questioned whether Ingenico should be barred from presenting certain evidence due to estoppel in the PTAB proceedings, especially considering that some documents and witness testimony were not available during the review.

The patents at issue are U.S. Patent Nos. 9,059,969 and 9,774,703. The Federal Circuit panel, which includes Judges Dyk, Prost, and Hughes, reserved its decision. The case is Ingenico Inc. v. Ioengine LLC, case number 23-1367, in the U.S. Court of Appeals for the Federal Circuit.