Patent Owner Beware: Provisional Deletions and the Limits of Incorporation by Reference

In DDR Holdings, LLC v. Priceline.com LLC., the Federal Circuit held that a change in the scope of the invention from the provisional application to the nonprovisional application can affect the scope of the invention. The court held that, in view of the deletion of any reference to “merchant” providing “services” in the final nonprovisional specification, which was originally described in the provisional application, the claim term “merchant” was properly interpreted to mean producers, distributors or resellers of the goods to be sold, but not of services. It was insufficient that the nonprovisional application incorporated the provisional application by reference because a skilled artisan would recognize that the nonprovisional specification removed the description of “merchants” providing “services,” and that deletion, which was clear, would inform the skilled artisan that the patentee intended “merchants” to exclude services.

DDR Holdings owned U.S. Patent No. 7,818,399 (the ) involving the generating of a combination web page that merged certain visible elements of a host website with information from a third-party merchant. Through an outsource provider, the system allowed host websites to maintain visitor traffic and control the customer experience while presenting content on products from third-party merchants.

Claim 1 recited the following:

1. A method of an outsource provider serving web pages offering commercial opportunities, the method comprising:

(a) automatically at a server of the outsource provider, in response to activation, by a web browser of a computer user, of a link displayed by one of a plurality of first web pages, recognizing as the source page the one of the first web pages on which the link has been activated;

• (i) wherein each of the first web pages belongs to one of a plurality of web page owners;
• (ii) wherein each of the first web pages displays at least one active link associated with a commerce object associated with a buying opportunity of a selected one of a plurality of merchants; and
• (iii) wherein the selected merchant, the outsource provider, and the owner of the first web page are each third parties with respect to one other;

(b) automatically retrieving from a storage coupled to the server pre-stored data associated with the source page; and then

(c) automatically with the server computer-generating and transmitting to the web browser a second web page that includes:

• (i) information associated with the commerce object associated with the link that has been activated, and
• (ii) a plurality of visually perceptible elements derived from the retrieved pre-stored data and visually corresponding to the source page.

DDR sued Priceline.com for infringement of the . In the ‘399 patent, the district court construed “merchants” as “producers, distributors, or resellers of the goods to be sold, but not services.” DDR appealed the ruling and the Federal Circuit affirmed the claim interpretations.

• On appeal, the Federal Circuit reiterated that “claim language is usually given its plain and ordinary meaning as interpreted to one of skill in the art in view of the specification and prosecution history.) However, a patent owner can act as his own lexicographer and provide a specific definition or can disavow the full scope of claim language by statements made in the specification or during prosecution.”

With respect to the interpretation of “merchants”, the court observed that the interpretation of this term depended on the specification descriptions made in the and the provisional application, to which the ‘399 patent claimed priority. Specifically, the provisional application, which looked like a marketing document, described an alternative methodology for e-commerce that enabled merchants to leverage the Internet marketing competency of third-party website operators. The provisional application explained that merchants (i.e., producers, manufacturers, and select distributors of products or services) were deeply interested in the sales potential of the Internet. Thus, the provisional application described merchants as manufacturers of goods in one example and products or services in another example.

The specification of the included some similar descriptions. However, absent from the ‘399 patent specification was any discussion of services in connection with merchants. The district court reasoned that the removal from the disclosure of a term that was in the provisional application supported the interpretation of “merchants” as producers, distributors or resellers of the goods to be sold.

On appeal, DDR contended that it operated as its own lexicographer by supplying, in the provisional application, a clear definition of “merchants” to comprise both goods and services and by including this definition as an unequivocal portion of the specification by incorporating by reference the provisional application.

The Federal Circuit rejected DDR’s arguments, emphasizing that “the deletion made by the patent drafter between the provisional application and the patent specification [was] highly significant.” The court acknowledged that, while DDR’s provisional application described merchants as both suppliers of products or services, DDR removed the description to “products or services” in the ‘399 patent specification and, instead, described merchants as suppliers of only goods. Accordingly, the court stated that, “[i]n light of the patentee’s deletion of any reference to merchants providing ’services’ in the final specification, we agree with the district court’s construction that 'merchants' are purveyors of goods, not services.”

 Accordingly, the court affirmed the district court’s interpretation of “merchants” as “producers, distributors, or resellers of the goods to be sold.”

The court rejected DDR’s argument that “merchants” should be interpreted to include services in view of the ’s specification that incorporated the provisional application by reference. The court reasoned that, when a host patent incorporates another patent by reference, the specification of the host patent affords perspective to decide what effect a patent incorporated by reference will have on interpretation of the host patent claims. Here, the court explained, a skilled artisan reading the provisional patent application would recognize that the specification removed the description that merchants provided services, reasoning that “[t]hat deletion, which ’was conspicuous and unambiguous,’ would in turn indicate to a skilled artisan that the patentee intended “merchants” to exclude services.”

The court, therefore, affirmed the district court’s construction of “merchants” as purveyors of goods, not services.

Notable Considerations:

The DDR Holdings, LLC v. Priceline.com LLC decision provides valuable teachings for patent owners and litigators. Specifically, the Federal Circuit held that a change in the description of the invention from the provisional to the nonprovisional specification can affect how a skilled artisan would interpret claim terms and scope of the invention in view of the prosecution history. Patent applicants must be careful when filing a nonprovisional patent application that claims priority to a provisional application. Provisional applications must be carefully drafted to include detailed technical specifications that encompass as many embodiments that may be considered of value in the future. A brief or informal provisional application might be insufficient for priority purposes or, as in the DDR case, may result in an unwanted claim interpretation for the nonprovisional patent application claiming priority therefrom. 

Before filing a nonprovisional patent application, the applicant should compare the specification to the provisional specification to determine whether any terminology or definitions have been modified or deleted. When in doubt, the nonprovisional specification should include clarifying statements to ensure the appropriate scope of claim coverage or specific claim terminology will have the appropriate interpretation. DDR also instructs patent litigators to carefully review provisional and nonprovisional specifications to be correctly informed of claim scope and interpretation of key claim terminology.

DDR, however, involved an unusual situation where the provisional application technical specification was broader than the later filed non-provisional application specification. In some situations, this might be a strategic or intended decision to limit the scope of the invention, which might buttress the validity of the claimed invention by limiting or avoiding prior art.

The DDR decision acknowledges that claim language is interpreted from the perspective of one of ordinary skill in the art, yet says that a skilled artisan would understand that the deletion of services from the nonprovisional specification showed that the patentee intended “merchants” to exclude services. However, neither one of ordinary skill nor skilled artisan terminology are defined by the court. In addition, is a skilled artisan someone different than one of ordinary skill in the art? Stay tuned for further developments.

is a Partner in Manatt, Phelps and Phillip’s Intellectual Property Protection and Enforcement unit and is the author of Patent Prosecution: Law, Practice, and Procedure, 2024 Edition, and Constructing and Deconstructing Patents (2d Edition 2016). 

DDR Holdings, LLC v. Priceline.com LLC.,122 F.4th 911, 2024 USPQ.2d 2136, 2024 WL 5036178 (Fed. Cir. 2024).

Id., 122 F.4 at 913-914.

Id., 122 F.4th at 914.

Id., 122 F.4th at 916.

Id., 122 F.4th at 916-17.

Id., 122 F.4th at 917.

Id., 122 F.4th at 917-18.