Case: 20-2070 Document: 51 Page: 1 Filed: 02/04/2022
United States Court of Appeals
for the Federal Circuit
______________________
QUANERGY SYSTEMS, INC.,
Appellant
v.
VELODYNE LIDAR USA, INC., FKA VELODYNE
LIDAR, INC.,
Appellee
______________________
2020-2070, 2020-2072
______________________
Appeals from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in Nos. IPR2018-
00255, IPR2018-00256.
______________________
Decided: February 4, 2022
______________________
ERIK BENTON MILCH, Cooley LLP, Reston, VA, argued
for appellant. Also represented by JENNIFER VOLK;
ELIZABETH SHRIEVES, Washington, DC; PRIYA B.
VISWANATH, Palo Alto, CA.
DOUGLAS ETHAN LUMISH, Latham & Watkins LLP,
Menlo Park, CA, argued for appellee. Also represented by
BRETT MATTHEW SANDFORD; GABRIEL K. BELL, JONATHAN
M. STRANG, Washington, DC; ANN MARIE WAHLS, Chicago,
IL.
______________________
Case: 20-2070 Document: 51 Page: 2 Filed: 02/04/2022
2 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
Before NEWMAN, LOURIE, and O’MALLEY, Circuit Judges.
O’MALLEY, Circuit Judge.
This appeal is about a laser-based system for measur-
ing distances. While useful for a number of purposes, the
system is best known for helping autonomous cars sense
their surroundings. U.S. Patent No. 7,969,558 (“the ’558
patent”) claims such a system, and appellee Velodyne Lidar
USA, Inc. markets products incorporating such systems.
Appellant Quanergy Systems, Inc. also markets products
employing laser systems. Unsurprisingly, Quanergy chal-
lenged the validity of multiple claims in the ’558 patent in
two inter partes review (“IPR”) proceedings before the Pa-
tent Trial and Appeal Board (“Board”).
Quanergy now appeals the two final written decisions
of the Board in those proceedings. In its decisions, the
Board held that claims 1–4, 8, 9, 16–19, and 23–25 of the
’558 patent are not unpatentable as obvious. Quanergy
Sys., Inc. v. Velodyne Lidar, Inc. (Quanergy I),
No. IPR2018-00255, 2019 WL 2237114 (P.T.A.B. May 23,
2019); Quanergy Sys., Inc. v. Velodyne Lidar, Inc. (Quan-
ergy II), No. IPR2018-00256, 2019 WL 2237137 (P.T.A.B.
May 23, 2019). We affirm both decisions.
I. BACKGROUND
A. The ’558 Patent
The ’558 patent, entitled “High Definition Lidar Sys-
tem,” relates to a lidar-based 3-D point cloud measuring
system. ’558 patent, at [54]; id. at col. 3, ll. 3–4. Lidar, or
ladar, is an acronym for “Laser Imaging Detection and
Ranging.” Id. at col. 3, ll. 65–66. Think radar—“Radio De-
tection and Ranging”—but employing light rather than ra-
dio waves.
The specification begins by describing the well-known
use of a pulse of light to measure distance. Id. at col. 1,
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QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. 3
ll. 11–12. First, a laser emitter pulses, emitting a burst of
light. Id. at col. 1, ll. 13–14. A system then measures the
time it takes for the pulse of light to return to a detector
mounted near the laser emitter. Id. at col. 1, ll. 15–17. Us-
ing that measurement, the system can derive a distance
with high accuracy. Id. at col. 1, ll. 17–18. The parties
refer to this technique of measuring distance as pulsed
time-of-flight (or “ToF”) lidar.
The specification explains that each distance measure-
ment is a “pixel,” and a collection of pixels is called a “point
cloud.” Id. at col. 1, ll. 19–23. Systems may render a point
cloud as an image or analyze it for other reasons, including
detecting obstacles. Id. at col. 1, ll. 22–24. According to the
specification, a number of commercial products are capable
of rendering a 2-D point cloud. Id. at col. 1, ll. 32–34. Most
of these devices capture distance measurements using a
single laser emitter and detector, as well as a moving mir-
ror. Id. at col. 1, ll. 36–39. These devices can also provide
for a 3-D point cloud by, e.g., mounting the instrument on
a gimbal that “nods” the unit up and down to increase the
field of view or using a prism to divide the laser pulse into
multiple layers with different vertical angles. Id. at col. 1,
ll. 47–64.
The specification criticizes these existing 3-D point
cloud systems because “the needs for autonomous vehicle
navigation place unrealistic demands on” them. Id. at
col. 2, ll. 35–37. According to the specification, some sys-
tems take excellent pictures but are unsuitable for high-
way use because they take several minutes to collect a
single image. Id. at col. 2, ll. 37–40. Others suffer from a
limited field of view. See id. at col. 2, ll. 40–45. The speci-
fication explains that “it is necessary to see everywhere
around the vehicle, almost a full 360 degrees, in order to
safely navigate today’s highways,” as well as “to have a
minimum of delay between the actions happening in the
real world and the imaging/reaction to it.” Id. at col. 2,
ll. 45–49. The specification estimates that the update rate
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4 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
of the point cloud—or “refresh rate”—should be at least 5
times per second and specifies that the vertical field of view
should extend from above the horizon to as close to the
ground in front of the vehicle as possible. See id. at col. 2,
ll. 53–57.
In this context, the specification discloses its invention
of a lidar-based 3-D point cloud measuring system, which
rotates a plurality of laser emitters and detectors. See id.
at col. 3, ll. 3–9. The invention “provides a more compact
and rugged unit for gathering 3-D point cloud information.”
Id. at col. 3, ll. 28–30. The preferred embodiment is a lidar
system that uses 64 pairs of laser emitters and detectors,
has a 360-degree horizontal field of view and a 26.8-degree
vertical field of view, and rotates at a rate of up to 200 Hz.
Id. at col. 3, l. 67–col. 4, l. 7. The system can collect approx-
imately 1 million time-of-flight distance points per second,
and it provides the unique combination of a 360-degree
field of view, a broad vertical field of view, a high point
cloud density, and a high refresh rate. Id. at col. 4, ll. 9–13;
id. at col. 6, ll. 37–41.
Independent claim 1 is illustrative. It recites:
A lidar-based 3-D point cloud system comprising:
a support structure;
a plurality of laser emitters supported by
the support structure;
a plurality of avalanche photodiode detec-
tors supported by the support structure;
and
a rotary component configured to rotate the
plurality of laser emitters and the plurality
of avalanche photodiode detectors at a
speed of at least 200 RPM.
Id. at col. 7, ll. 59–67.
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QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. 5
B. The Prior Art
Two prior art references are relevant to this appeal.
1. Mizuno
Japanese Patent Application No. H3-6407 (“Mizuno”)
describes a device that measures the outer peripheral
shape of an object. J.A. 4285. According to Mizuno, con-
ventional devices determined an object’s shape by revolv-
ing around the object, scanning a light toward it, and using
a light detector opposite the light source to measure where
the object blocks the light. J.A. 4285–86. Mizuno explains
that these conventional devices could not accurately meas-
ure the object’s outer peripheral shape because they could
not measure or detect a recessed portion of the object.
J.A. 4286.
To solve this problem, Mizuno teaches the use of a “re-
flected light-type distance measuring instrument” that is
on a rotating member and oriented toward the centerline
of the rotating member, where a measured object is placed.
J.A. 4286. The instrument emits light toward the center-
line and measures the distance to the object by detecting
the reflected light. J.A. 4286. In one embodiment of the
claimed invention, Mizuno explains that the instrument
measures the distance to the location of the reflection
“based on the location at which the light is detected.”
J.A. 4287. Mizuno further teaches that its device can
measure surface defects “because the detection position for
the reflected light will shift.” J.A. 4288.
Quanergy asserts that Mizuno renders the challenged
claims of the ’558 patent obvious because “Mi-
zuno . . . teaches and renders obvious a pulsed ToF ‘lidar’
system.” Appellant’s Reply Br. 16.
2. Berkovic
Berkovic is an article published in 2012, entitled “Op-
tical Methods for Distance and Displacement
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6 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
Measurements.” J.A. 6985–7007. It reviews various tech-
niques for measuring distance to objects, including trian-
gulation and time-of-flight sensing. See J.A. 6985.
According to Berkovic, triangulation is “a procedure in
which a distance or position is determined from considera-
tions based on the geometries of similar triangles.”
J.A. 6990. Berkovic reports that commercially available
triangulation sensors “are generally applicable for distance
measurements in ranges of approximately 10 mm to 1 m.”
J.A. 6991–92. Meanwhile, problems arise when using laser
time-of-flight sensors to obtain accurate measurements at
distances shorter than tens of meters. 1 J.A. 6993.
C. Procedural History
Quanergy filed two petitions for inter partes review. In
one petition, Quanergy challenged claims 1–4, 8, and 9 of
the ’558 patent as obvious over Mizuno. In the other peti-
tion, Quanergy challenged claims 16–19 and 23–25 of the
’558 patent, also asserting obviousness over Mizuno. 2 The
Board instituted review on both petitions. In substantially
similar final written decisions, the Board held that
1 Although Quanergy never asserted the combina-
tion of Mizuno and Berkovic, it argued that Berkovic
showed what was known in the state of the art at the time
and what technologies a skilled artisan might use in a sys-
tem like Mizuno, including time-of-flight technology.
Quanergy I, 2019 WL 2237114, at *8.
2 While Quanergy also asserted that the challenged
claims were obvious over Mizuno in combination with other
prior art references, it only appeals the Board’s findings re-
lating to its Mizuno-only based challenges. We accordingly
do not discuss either the art mentioned in the other as-
serted combinations or the Board’s reasons for rejecting
those challenges.
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QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. 7
Quanergy had not shown that the challenged claims were
unpatentable.
Four of the Board’s determinations are pertinent to
these appeals. 3 First, the Board construed the term “lidar”
to mean “pulsed time-of-flight (ToF) lidar.” Quanergy I,
2019 WL 2237114, at *5. The Board explained that the
specification exclusively focuses on pulsed time-of-flight li-
dar: “That basic concept of deriving distance by measuring
the ‘time’ of travel (i.e., flight) of the laser pulse to and from
an object underlies the entire description of the ’558 pa-
tent.” Id. The Board noted that its construction of the term
“lidar” was consistent with the testimony of both parties’
experts. Id. at *6. It found no support in the record for the
testimony of Quanergy’s expert that the term “lidar” in-
cluded triangulation systems because the only contempo-
raneous article that the expert cited clearly distinguished
between triangulation-based and time-of-flight sensors.
Id.
Second, the Board found that Mizuno does not disclose
or suggest a lidar system as construed. Id. at *7. The
Board relied not only on its own reading of Mizuno, but also
on the testimony of both parties’ experts, who agreed that
Mizuno’s system is not a time-of-flight lidar system. Id. at
*6–7.
Third, the Board found that a skilled artisan would not
have used pulsed time-of-flight lidar in Mizuno’s short-
range measuring device. Id. at *8. According to the Board,
Berkovic suggests that the accuracy of pulsed time-of-flight
lidar measurements degrades in shorter ranges. Id.
Even assuming that Berkovic had suggested the use of
pulsed time-of-flight lidar for short-range measurement,
3 For brevity, we cite to Quanergy I. Unless other-
wise noted, all citations to Quanergy I should be under-
stood to reference the analogous passage in Quanergy II.
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8 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
moreover, the Board found that a skilled artisan would not
have had a reasonable expectation of success in modifying
Mizuno’s device to use pulsed time-of-flight lidar. See id.
at *8, *10, *12. The Board was unpersuaded by Quanergy’s
assertion that the modification was obvious to try because
“[t]he only evidence that Quanergy proffers of an expecta-
tion of success is speculation from its expert about the end-
less possibilities of Mizuno’s teachings.” Id. at *9. The
Board faulted Quanergy’s expert for not explaining “how or
why a skilled artisan would have had an expectation of suc-
cess in overcoming [the] problems in implementing a
pulsed [time-of-flight] sensor into a short-range measure-
ment system such as Mizuno’s” that Berkovic identifies.
Id. at *10. And it went on to find that other state-of-the-art
evidence supported its finding that a skilled artisan would
not reasonably expect to succeed in using pulsed
time-of-flight lidar in short-range measurement devices
like Mizuno’s system. See id. at *9.
Fourth, the Board found that, even if Quanergy had
satisfied the first three of the four factors established in
Graham v. John Deere Co., 383 U.S. 1 (1966), “Velodyne’s
objective evidence clearly outweighs any presumed show-
ing of obviousness by Quanergy.” 4 Id. at *17. The Board
presumed a nexus between the claimed invention and Velo-
dyne’s evidence of unresolved long-felt need, industry
praise, and commercial success. See id. at *12–13. It ex-
plained that Velodyne’s expert had provided a detailed
analysis mapping claim 1 of the ’558 patent to each of Velo-
dyne’s commercial products, testimony that Quanergy
4 The obviousness inquiry requires examination of
the four Graham factors: (1) the scope and content of the
prior art, (2) the differences between the prior art and the
claims at issue, (3) the level of ordinary skill in the perti-
nent art, and (4) any objective indicia of nonobviousness.
See 383 U.S. at 17–18.
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QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. 9
never disputed. Id. at *13. The Board noted that Quanergy
identified a 360-degree horizontal field of view, a wide ver-
tical field of view, and a dense 3-D point cloud as unclaimed
features such that Velodyne’s products were not coexten-
sive with the claimed invention. Id. But the Board found
that those features were “clearly supported by the chal-
lenged claims.” Id. For instance, the claims expressly call
for a 3-D point cloud, and “the density of the [point] cloud
and 360-degree field of view result directly from ‘rotat[ing]
the plurality of laser emitters and the plurality of ava-
lanche photodiode detectors at a speed of at least 200 RPM,’
as also called for by the claims.” Id. Moreover, the “3-D”
limitation “necessarily infers both a horizontal and vertical
field of view.” Id. at *13 n.8.
The Board denied Quanergy’s requests for rehearing,
and Quanergy timely appealed to this court. We have ju-
risdiction pursuant to 28 U.S.C. § 1295(a)(4)(A).
II. DISCUSSION
We review the Board’s legal determinations de novo
and its factual findings for substantial evidence. In re Van
Os, 844 F.3d 1359, 1360 (Fed. Cir. 2017). Substantial evi-
dence supports a finding if a reasonable mind might accept
the evidence to support the finding. Nobel Biocare Servs.
AG v. Instradent USA, Inc., 903 F.3d 1365, 1374 (Fed. Cir.
2018).
Claim construction is a question of law with underlying
questions of fact. Wasica Fin. GmbH v. Cont’l Auto. Sys.,
Inc., 853 F.3d 1272, 1278 (Fed. Cir. 2017). We review the
Board’s ultimate claim construction and any supporting de-
terminations based on intrinsic evidence de novo. Person-
alized Media Commc’ns, LLC v. Apple Inc., 952 F.3d 1336,
1339 (Fed. Cir. 2020). We review any subsidiary factual
findings involving extrinsic evidence for substantial evi-
dence. Id.
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10 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
Obviousness is also a question of law with underlying
questions of fact. Arctic Cat Inc. v. Bombardier Recrea-
tional Prods. Inc., 876 F.3d 1350, 1358 (Fed. Cir. 2017).
These facts include the scope and content of the prior art
and any objective indicia of nonobviousness. Bradium
Techs. LLC v. Iancu, 923 F.3d 1032, 1045 (Fed. Cir. 2019).
On appeal, Quanergy argues that the Board erred in
its construction of the term “lidar.” Quanergy also chal-
lenges the Board’s obviousness analysis. We address each
argument in turn.
A. Claim Construction
Claim 1 of the ’558 patent requires a “lidar-based” 3-D
point cloud system. ’558 patent, col. 7, l. 59. The intrinsic
evidence makes clear that the broadest reasonable inter-
pretation of “lidar” as used in the ’558 patent is pulsed
time-of-flight lidar.
The broadest reasonable interpretation standard ap-
plies in these IPR proceedings, because Quanergy filed its
petitions on November 29, 2017, and the ’558 patent is un-
expired. See Eli Lilly & Co. v. Teva Pharms. Int’l GmbH,
8 F.4th 1331, 1340 (Fed. Cir. 2021). 5 Under that standard,
we give claims their broadest reasonable construction in
light of the specification as a person of ordinary skill in the
5 For petitions filed on or after November 13, 2018,
the Board applies the claim construction standard articu-
lated in Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir.
2005) (en banc). See Changes to the Claim Construction
Standard for Interpreting Claims in Trial Proceedings Be-
fore the Patent Trial and Appeal Board, 83 Fed. Reg.
51,340, 51,340–41 (Oct. 11, 2018). The Board also applies
the Phillips standard to claims of an expired patent. Wa-
sica Fin. GmbH v. Cont’l Auto. Sys., Inc., 853 F.3d 1272,
1279 (Fed. Cir. 2017).
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QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. 11
art would interpret them. Trivascular, Inc. v. Samuels,
812 F.3d 1056, 1061–62 (Fed. Cir. 2016).
The term “lidar” is an acronym for “Laser Imaging De-
tection and Ranging.” ’558 patent, col. 3, ll. 65–66. Quan-
ergy proposes that the acronym simply requires the use of
laser light to perform imaging, detection, and ranging. Ac-
cording to Quanergy, lidar broadly encapsulates not only
pulsed time-of-flight techniques, but also techniques like
triangulation. Velodyne disagrees. Velodyne asserts that,
like radar, lidar determines distance based on the
time-of-flight of the transmitted wave.
We agree with Velodyne. In light of the specification,
a skilled artisan would interpret lidar to mean pulsed
time-of-flight lidar. Indeed, the written description focuses
exclusively on pulsed time-of-flight lidar. It begins by de-
scribing the well-known use of a pulse of light to measure
distance, deriving distance from the pulse’s time-of-flight.
See ’558 patent, col. 1, ll. 11–18. This technique is founda-
tional to the written description’s ensuing description of
commercial point cloud systems, their operation, and their
inability to meet the demands of autonomous vehicle navi-
gation. Id. at col. 1, l. 32–col. 2, l. 45. For example, the
patent describes an existing point cloud system that em-
ploys “a single beam lidar unit” and a gimbal to capture a
3-D array of distance points. Id. at col. 1, ll. 49–53. It then
teaches that such a system is limited by the number of
pulses per second that a single laser can emit. Id. at col. 2,
ll. 1–3.
The pulsed time-of-flight technique is also foundational
to the claimed invention, which purports to be an improve-
ment on existing 3-D point cloud systems that are inade-
quate for autonomous vehicle navigation. See id. at col. 2,
ll. 35–67; id. at col. 6, ll. 37–41. Indeed, when describing a
particular configuration of lasers and detectors in its lidar
system, the patent boasts that its preferred embodiment
“can collect approximately 1 million time of flight (TOF)
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12 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
distance points per second.” Id. at col. 4, ll. 9–11 (emphasis
added); see also id. at col. 4, ll. 13–14 (providing the stand-
ard deviation of the collected time-of-flight measurements);
id. at col. 5, ll. 11–15 (explaining that a processor in the
lidar system controls the laser emitters and detectors and
“records the time-of-flight” (emphasis added)). The intrin-
sic evidence makes clear that the term “lidar” means
pulsed time-of-flight lidar. 6
We are unpersuaded by Quanergy’s arguments on ap-
peal. First, Quanergy argues that the claims and specifi-
cation do not restrict the term “lidar” to pulsed time-of-
flight lidar. Analogizing to Veritas Technologies LLC v.
Veeam Software Corp., 835 F.3d 1406 (Fed. Cir. 2016),
Quanergy contends that the “indications in the specifica-
tion that ‘lidar’ may involve pulsed [time-of-flight] meas-
urements” do not preclude a broader construction that
includes triangulation and other techniques. Appellant’s
Br. 22–23 (citing Veritas, 835 F.3d at 1411).
We disagree with Quanergy’s characterization of the
specification as merely indicating that lidar may involve
6 Given the clarity of the intrinsic evidence, resort to
extrinsic evidence is unnecessary. Seabeds Geosolutions
(US) Inc. v. Magseis FF LLC, 8 F.4th 1285, 1290 (Fed. Cir.
2021). We note, however, that the Board’s findings based
on extrinsic evidence are consistent with the Board’s con-
struction. Quanergy failed to challenge these findings in
its opening brief, and its attempt to do so in its reply brief
is untimely. SmithKline Beecham Corp. v. Apotex Corp.,
439 F.3d 1312, 1319 (Fed. Cir. 2006) (“Our law is well es-
tablished that arguments not raised in the opening brief
are waived.”); see In re Google Tech. Holdings LLC,
980 F.3d 858, 862 (Fed. Cir. 2020) (“[I]t is evident that the
court mainly uses the term ‘waiver’ when applying the doc-
trine of ‘forfeiture.’”).
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QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. 13
pulsed time-of-flight measurements. As noted, the specifi-
cation focuses exclusively on pulsed time-of-flight lidar.
Quanergy’s reliance on Veritas is misplaced. There, we
affirmed the Board’s construction of the phrase “starting a
restore of a set of files” as encompassing both file-level and
block-level restoration. 7 See id. at 1411. We explained that
“nothing in the specification states or fairly implies a limi-
tation to file-level restoration.” Id. at 1412. While the spec-
ification generally described starting a restore of files (and
not blocks), it did not exclude restorations that operate at
the block-level but result in restoring files. Id. And, alt-
hough the specification discussed certain steps that would
be difficult or impossible to perform at the block-level, it
couched those references “in terms of specific embodi-
ments, not general requirements of the invention.” Id.
Critically, the specification did not explain any material
differences between file-level and block-level restoration.
Id.
By contrast, here, the specification fairly implies that
the term “lidar” only means pulsed time-of-flight lidar. The
patent describes measuring distance using a pulsed
time-of-flight technique, identifies the shortcomings of ex-
isting point cloud systems that collect distance points by
pulsing light and detecting its reflection, and discloses a
lidar system that collects time-of-flight measurements. Be-
cause Veritas is factually distinguishable, we reject Quan-
ergy’s broader construction of the term “lidar.”
7 A file is essentially a named collection of blocks,
which contain all of the data of the file. Veritas, 835 F.3d
at 1408. An application restores at the file-level by re-
questing a file and receiving the data in the blocks corre-
sponding to the file. See id. An application restores at the
block-level by requesting the block it needs and receiving
the data in that block. See id.
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14 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
Second, Quanergy argues that the Board improperly
limited the meaning of the term “lidar” to a preferred em-
bodiment. Not so. The Board did not read limitations from
a preferred embodiment into the claims. Instead, it consid-
ered the entire disclosure, which introduces the concept of
pulsed time-of-flight lidar “[r]ight from the start,” a concept
that “underlies the entire description of the ’558 patent.”
Quanergy I, 2019 WL 2237114, at *5.
Third, Quanergy emphasizes that Velodyne chose to
claim only “lidar” instead of “pulsed time-of-flight lidar.”
But this argument assumes its conclusion—that the term
“lidar” is broader than the Board’s construction “pulsed
time-of-flight lidar.” As noted, in light of the intrinsic evi-
dence, a skilled artisan would interpret the term “lidar” to
mean pulsed time-of-flight lidar.
Finally, Quanergy argues that its broader construction
of “lidar”—to include triangulation—is reasonable because
the ’558 patent at most expands the acronym to “Laser Im-
aging Detection and Ranging.” As the Board did, we find
that simply restating what the “lidar” acronym stands for
does little to explain the term’s meaning in light of the spec-
ification. Because Quanergy’s broader construction is in-
consistent with the specification, we find it to be
unreasonable. See Trivascular, 812 F.3d at 1062 (“Con-
struing individual words of a claim without considering the
context in which those words appear is simply not ‘reason-
able.’”).
For these reasons, we affirm the Board’s construction
of the term “lidar” to mean pulsed time-of-flight lidar.
B. Obviousness
Quanergy also appeals several of the factual findings
underlying the Board’s nonobviousness determination.
First, Quanergy asserts that Mizuno discloses a pulsed
time-of-flight lidar system. Second, Quanergy challenges
the Board’s presumption of a nexus between the claimed
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QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. 15
invention and Velodyne’s evidence of an unresolved
long-felt need, industry praise, and commercial success.
Quanergy adds that Velodyne cannot prove a nexus either.
We address these challenges in turn.
1. Mizuno
The Board made several findings as to Mizuno based
on the expert testimony of both parties and subsidiary find-
ings as to Berkovic and other state-of-the-art references. It
found that Mizuno does not disclose or suggest a pulsed
time-of-flight lidar system. See Quanergy I, 2019 WL
2237114, at *7. It further found that a skilled artisan
(a) would not have used pulsed time-of-flight lidar in Mi-
zuno’s short-range measuring device and (b) would not
have had a reasonable expectation of success in modifying
Mizuno’s device to use pulsed time-of-flight lidar. See id.
at *8, *10, *12.
On appeal, Quanergy only disputes the Board’s find-
ings that Mizuno neither discloses nor suggests the use of
a pulsed time-of-flight lidar system. Substantial evidence
supports those findings. Notably, the testimonies of both
Velodyne’s and Quanergy’s experts support the Board’s
findings. Velodyne’s expert opined that a skilled artisan
“would immediately recognize Mizuno as a triangulation
system.” J.A. 8065 (¶ 127). He explained that Mizuno de-
tects light reflected at an angle using position or image sen-
sors, neither of which are used in pulsed time-of-flight lidar
systems. And, while Quanergy’s expert described Mizuno’s
device as a specular reflection system instead of a triangu-
lation system, he agreed that Mizuno’s device is not a
time-of-flight lidar system. He also conceded that Mizuno
measures distance to the target based on where it receives
a reflected laser beam, not when as lidar systems do.
Quanergy disagrees with the Board’s analysis of its ex-
pert testimony. According to Quanergy, its expert was de-
scribing only one particular embodiment of Mizuno’s device
when he stated that Mizuno’s device was not a pulsed
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16 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
time-of-flight lidar system. The Board rejected this argu-
ment as an attempt to draw an arbitrary distinction in the
testimony of its expert between one of Mizuno’s figures and
Mizuno’s disclosure as whole. Quanergy Sys., Inc. v. Velo-
dyne LiDAR, Inc. (Quanergy III), No. IPR2018-00255,
2020 WL 2595492, at *8–9 (P.T.A.B. May 21, 2020) (deny-
ing Quanergy’s request for rehearing); Quanergy Sys., Inc.
v. Velodyne LiDAR, Inc. (Quanergy IV),
No. IPR2018-00256, 2020 WL 2595636, at *8–9 (P.T.A.B.
May 21, 2020) (same). We are similarly unpersuaded by
Quanergy’s attempt to downplay its expert’s admission
that Mizuno’s device is not a time-of-flight lidar system.
Quanergy finally relies on its expert’s testimony on re-
direct that “Mizuno could use a time-of-flight pulsed Li-
DAR system,” 8 as well as its expert’s ultimate conclusion
that a person of ordinary skill in the art reading Mizuno
would have found it obvious to use a pulsed time-of-flight
system. Appellant’s Br. 25–26 (citing J.A. 9114–15); see
also, e.g., Quanergy III, 2020 WL 2595492, at *9. Under
our standard of review, we sustain a finding of the Board
that may reasonably be drawn from the evidence in record,
even if the Board reasonably could have drawn other incon-
sistent findings from the same record. See Elbit Sys. of
Am., LLC v. Thales Visionix, Inc., 881 F.3d 1354, 1356
(Fed. Cir. 2018). Here, we agree with the Board that the
testimony of Quanergy’s expert on redirect is “incomplete,
unspecific, and ultimately conclusory.” E.g., Quanergy III,
2020 WL 2595492, at *10. The Board acted within its dis-
cretion when it chose not to credit that testimony. See id.
On the entirety of the record, substantial evidence supports
the Board’s finding that one of skill in the art would not
have been motivated by Mizuno to use a pulsed
time-of-flight system.
8 Quanergy misattributes this testimony to Velo-
dyne’s expert.
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QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. 17
2. Objective Indicia of Nonobviousness
The Board gave substantial weight to Velodyne’s objec-
tive evidence of unresolved long-felt need, industry praise,
and commercial success. Substantial evidence supports
the Board’s presumption of a nexus and its thorough anal-
ysis of each objective indicia.
Evidence of objective indicia of nonobviousness, if pre-
sent, must always be considered before reaching a determi-
nation on the issue of obviousness. E.g., Stratoflex, Inc. v.
Aeroquip Corp., 713 F.2d 1530, 1538–39 (Fed. Cir. 1983);
In re Cyclobenzaprine Hydrochloride Extended-Release
Capsule Patent Litigation, 676 F.3d 1063, 1076–77
(Fed. Cir. 2012). To accord substantial weight to such evi-
dence, it “must have a ‘nexus’ to the claims, i.e., there must
be ‘a legally and factually sufficient connection’ between
the evidence and the patented invention.” Teva Pharms.,
8 F.4th at 1360 (quoting Henny Penny Corp. v. Frymaster
LLC, 938 F.3d 1324, 1332 (Fed. Cir. 2019)).
We presume a nexus “when the patentee shows that
the asserted objective evidence is tied to a specific product
and that product ‘embodies the claimed features, and is co-
extensive with them.’” Fox Factory, Inc. v. SRAM, LLC,
944 F.3d 1366, 1373 (Fed. Cir. 2019) (quoting Polaris In-
dus., Inc. v. Arctic Cat, Inc., 882 F.3d 1056, 1072 (Fed. Cir.
2018)). The coextensive requirement does not require a pa-
tentee to prove perfect correspondence between the product
and a patent claim. Teva Pharms., 8 F.4th at 1361. Ra-
ther, it requires the patentee to demonstrate that “the
product is essentially the claimed invention.” Id. As part
of the presumption analysis, the fact finder must consider
the unclaimed features of the stated products to determine
their level of significance and their impact on the corre-
spondence between the claim and the products. Id. Some
unclaimed features “amount to nothing more than addi-
tional insignificant features,” such that presuming nexus
is still appropriate. Id. Other unclaimed features, like “a
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18 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
‘critical’ unclaimed feature that is claimed by a different
patent and that materially impacts the product’s function-
ality,” indicate that the claim is not coextensive with the
product. Id.
The presumption of nexus is rebuttable. Demaco Corp.
v. F. von Langsdorff Licensing Ltd., 851 F.2d 1387, 1393
(Fed. Cir. 1988). A patent challenger may present evidence
showing that the proffered objective evidence was “due to
extraneous factors other than the patented invention.”
WBIP, LLC v. Kohler Co., 829 F.3d 1317, 1329 (Fed. Cir.
2016). These extraneous factors include additional un-
claimed features and external factors, like improvements
in marketing or superior workmanship. Id.; see also
Demaco, 851 F.2d at 1393. A patent challenger may not
rebut the presumption of nexus with argument alone.
WBIP, 829 F.3d at 1329.
Here, the Board presumed a nexus because Velodyne
provided “ample evidence” that its commercial products
“embody the full scope of the claimed invention, and that
the claimed invention is not merely a subcomponent of
those products.” Quanergy I, 2019 WL 2237114, at *12.
The Board credited the testimony of Velodyne’s expert, who
provided “a detailed analysis mapping claim 1” to the de-
scriptions in Velodyne’s product literature. Id. at *13. The
Board noted that Quanergy never disputed this testimony.
Id.
The Board then rejected Quanergy’s attempt to rebut a
presumption of nexus because the unclaimed features
Quanergy identified—“360[-]degree horizontal field of
view, wide vertical [field of view], and a dense 3-D point
cloud”—were clearly supported by the challenged claims.
Id. (quoting J.A. 1023). For example, the claims call for a
“3-D point cloud,” and the density of the cloud and the
360-degree horizontal field of view “result directly” from
the claim limitation “rotat[ing] the plurality of laser emit-
ters and the plurality of avalanche photodiode detectors at
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QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. 19
a speed of at least 200 RPM.” Id. Further, the “3-D” limi-
tation “necessarily infers both a horizontal and vertical
field of view.” Id. at *13 n.8. The Board noted that Quan-
ergy’s assertion that Velodyne’s commercial success re-
sulted from unclaimed software was “nothing more than
conclusory attorney argument without evidentiary sup-
port.” Id. at *13.
The Board gave substantial weight to Velodyne’s evi-
dence of an unresolved long-felt need, industry praise, and
commercial success. Id. at *14–17. This evidence included
(1) contemporaneous news articles describing a long-felt
need for a lidar sensor that could capture distance points
rapidly in all directions and produce a sufficiently dense
3-D point cloud for use in autonomous navigation, (2) arti-
cles praising both Velodyne as the top lidar producer in the
automotive industry and Velodyne’s products, and (3) fi-
nancial information and articles reflecting Velodyne’s rev-
enue and market share. Id.
On appeal, Quanergy argues that the Board erred in
three ways. First, Quanergy contends that the Board
must, but failed to, consider the issue of unclaimed features
before presuming nexus. Second, Quanergy asserts that
the Board failed to provide an adequate factual basis or
reasoned explanation when it dismissed the unclaimed fea-
tures Quanergy identified. Third, Quanergy attempts to
show that the unclaimed features it identified to the
Board—a 360-degree horizontal field of view, a wide verti-
cal field of view, a dense 3-D point cloud, and software—
are critical and materially impact the functionality of Velo-
dyne’s products. Quanergy also contends that Velodyne’s
evidence of unresolved long-felt need, industry praise, and
commercial success relate primarily to those critical un-
claimed features. None of these arguments are persuasive.
First, the Board did not err in its analysis of whether
Velodyne is entitled to a presumption of nexus. There is no
dispute that the Board must consider unclaimed features
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20 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
as part of its presumption analysis when they are raised.
See Teva Pharms., 8 F.4th at 1361; Fox Factory, 944 F.3d
at 1374. Here, Quanergy, at best, presented only a skele-
tal, undeveloped argument to the Board. In total, Quan-
ergy stated that Velodyne’s “evidence focuses on unclaimed
[sic] that are not coextensive with the patented claims,”
and that Velodyne “fail[ed] to show that the claimed ele-
ments are not merely a component of its product, by failing
to address the configuration, software and other compo-
nents that form its product, and apparently allow it to per-
form the praised features.” J.A. 1023–25. As the Board
found, Quanergy only raised the issue of unclaimed fea-
tures to rebut the presumption of nexus. See Quanergy I,
2019 WL 2237114, at *13; see also J.A. 1025–1026 (arguing
that the presumption of nexus is rebutted because Velo-
dyne’s “evidence relies on unclaimed features”). Based on
Velodyne’s product literature and expert testimony, the
Board reasonably found that Velodyne’s products embody
the full scope of the claimed invention and that the claimed
invention is not merely a subcomponent of those products.
See Quanergy I, 2019 WL 2237114, at *12–13.
Second, we disagree with Quanergy’s assertion that the
Board failed to provide an adequate factual basis or rea-
soned explanation when it dismissed the unclaimed fea-
tures Quanergy identified to rebut a presumption of nexus.
The Board’s analysis of those unclaimed features is com-
mensurate with Quanergy’s presentation of the issue. See
Paice LLC v. Ford Motor Co., 881 F.3d 894, 905 (Fed. Cir.
2018); Novartis AG v. Torrent Pharms. Ltd., 853 F.3d 1316,
1327 (Fed. Cir. 2017) (“Thus, we are not persuaded that
Novartis presented its arguments against the use of man-
nitol in such a way that it would be appropriate to find fault
in the Board’s arguably limited treatment of those argu-
ments in the Final Written Decision.”).
In total, Quanergy argued:
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QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC. 21
[Velodyne’s] evidence relies on unclaimed features.
See, e.g., Response, 58-62 (rooting long-felt need in
autonomous driving context requiring “high frame-
rate, dense 3D point cloud with a wide [field of
view]” and collecting measurements in an outward
facing lidar for 360 degree azimuth and 26 degree
vertical arc); 62-65 (describing praise due to un-
claimed features such as “distance and point den-
sity,” “360-degree horizontal field-of-view,”
“26-degree vertical spread,” and “one million points
per second[)].”
J.A. 1025–26. We find the Board’s explanation of how each
alleged unclaimed feature results directly from claim limi-
tations—such that Velodyne’s products are essentially the
claimed invention—both adequate and reasonable. See Fox
Factory, Inc. v. SRAM, LLC, 813 F. App’x 539, 543
(Fed. Cir. 2020) (holding that the alleged unclaimed fea-
tures were “to some extent incorporated” into a claim limi-
tation).
Finally, Quanergy’s attempts to show that (1) the un-
claimed features it identified to the Board are critical and
materially impact the functionality of Velodyne’s products
and (2) Velodyne’s evidence of unresolved long-felt need,
industry praise, and commercial success relate to those un-
claimed features rest on new arguments not presented to
the Board. For example, Quanergy contends that, to obtain
a dense 3-D point cloud, Velodyne’s products contain the
critical unclaimed features of (1) more than 2 laser emit-
ters, (2) a high pulse rate, (3) a vertical angular separation
between pairs of emitters and detectors, and (4) a rotation
speed significantly greater than 200 RPM. We hold that
Quanergy has forfeited these new arguments. See, e.g., In
re Google Tech. Holdings LLC, 980 F.3d 858, 863 (Fed. Cir.
2020).
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22 QUANERGY SYSTEMS, INC. v. VELODYNE LIDAR USA, INC.
III. CONCLUSION
For the reasons discussed above, we affirm the Board’s
decisions holding that claims 1–4, 8, 9, 16–19, and 23–25 of
the ’558 patent are not unpatentable as obvious.
AFFIRMED