Federal Circuit Upholds PTAB’s Mixed Ruling in IBM–Zillow Patent Dispute

The United States Court of Appeals for the Federal Circuit has affirmed a mixed ruling from the Patent Trial and Appeal Board (PTAB) in a long-running patent dispute between International Business Machines Corporation (IBM) and Zillow Group, Inc. The case concerns IBM’s U.S. Patent No. 7,631,346, which covers methods for managing single sign-on (SSO) operations within distributed computing environments.

The ‘346 patent describes a system allowing users to access multiple online platforms using a single set of login credentials, enabling authentication between systems through data sharing. IBM asserted that Zillow’s technology infringed several claims of this patent, while Zillow and its predecessor in the inter partes review (IPR), Ebates Performance Marketing, Inc. (doing business as Rakuten Rewards), challenged the validity of the claims before the PTAB.

The PTAB had issued a split decision in October 2023, finding certain claims unpatentable while upholding others. IBM appealed the invalidated claims, and Zillow cross-appealed the surviving claims. On December 9, 2025, the Federal Circuit affirmed the Board’s conclusions in full, resolving a dispute that centered on the interpretation of key claim terms and the scope of prior art disclosures.

The Patent and the Claimed Technology

IBM’s ‘346 patent defines a federated computing environment where systems interact to authenticate users seamlessly. The invention uses identifiers from one system (“first system”) to automatically generate user accounts and grant access to another (“second system”) without requiring new credentials. The concept enables, for example, a user authenticated on a social media platform to gain access to another website’s services without separate registration.

The central claim at issue recited a process for triggering SSO operations to access “protected resources,” creating user accounts based on identifiers exchanged between systems. Zillow and Rakuten argued that these functions were disclosed or obvious in light of an earlier Japanese patent application, known as Sunada, which described a network apparatus allowing account creation across web services.

IBM defended its patent by asserting that the PTAB’s findings relied on new theories not present in the original petition and that the prior art did not disclose receiving a unique user identifier from one system to another. Zillow’s cross-appeal, conversely, focused on the Board’s decision to uphold certain dependent claims that involved data retrieval processes.

The Federal Circuit’s Analysis

Writing for the panel, Judge Raymond Chen affirmed the PTAB’s reasoning on both the appeal and the cross-appeal. The court concluded that the Board had acted within the scope of the issues presented in the inter partes review and that substantial evidence supported its factual determinations.

IBM argued that the Board improperly relied on an “obviousness-like” rationale for the term “protected resources,” rather than the “anticipation” theory raised in Rakuten’s petition. The court disagreed, explaining that the PTAB’s finding—that a skilled artisan would understand Sunada’s “web applications” to use conventional URLs—was consistent with anticipation analysis. “The Board never proposed to modify Sunada’s web application to contain URLs,” the opinion stated, rejecting IBM’s procedural challenge.

On the merits, the Federal Circuit also upheld the Board’s determination that Sunada disclosed “an identifier associated with the user.” The panel agreed that Sunada’s use of a “User ID” uniquely identifying individuals, transmitted as “information regarding the user,” met this claim limitation. As the opinion noted, the Board’s conclusion was “reasonable in light of the context of Sunada’s disclosure.”

Zillow’s Cross-Appeal and the Surviving Claims

Zillow’s cross-appeal targeted claims that the PTAB found not unpatentable, particularly those describing how a system requests additional user information during account creation. The court analyzed two similar claims—claims 5 and 14—to address the alleged inconsistency raised by Zillow.

The Federal Circuit found that the claims differed in a critical respect. Claim 5 required a system to send a request for missing user information to a “first system” (the authentication source), while claim 14 required sending that request to a “fourth system” (the user’s computer). The prior art disclosed only the latter interaction, confirming the Board’s distinction. The panel ruled that “such a teaching discloses the relevant limitation of claim 14,” but not claim 5, affirming the Board’s decision to leave those dependent claims intact.

The court further noted that the PTAB’s conclusions were supported by substantial evidence and that neither Sunada nor other references, such as OASIS or Dutcher, disclosed the specific mechanism required by claim 5.

Broader Implications

The decision underscores the Federal Circuit’s deference to PTAB factual findings and its insistence on adherence to the theories presented in IPR petitions. It also highlights how fine distinctions in claim language—such as the source of a data request in a networked environment—can determine patentability outcomes in software and systems patents.

For technology companies, the ruling reaffirms the evidentiary burden in demonstrating how prior art discloses each limitation of a claimed invention, particularly in cases involving functional system interactions. IBM’s partial loss narrows its portfolio in SSO technologies, while Zillow avoids invalidation of the remaining claims that survived Board scrutiny.

The Federal Circuit’s affirmation of the PTAB’s mixed ruling leaves both sides with partial victories, but no further appeal appears to be pending.

Case Details

Case Name: International Business Machines Corp. v. Zillow Group, Inc.
Court Name: United States Court of Appeals for the Federal Circuit
Case Number: 2024-1170, 2024-1274
Plaintiff Attorney(s): Desmarais LLP
Defense Attorney(s): Susman Godfrey LLP