Supreme Court says “a substantial portion” of components in an accused product is determined by numbers—a quantitative analysis—not by the importance of the component—a qualitative analysis

United States Supreme CourtWe know that this is a PTAB blog. But sometimes we like to comment on a new Supreme Court opinion in the patent field—even if the issue could only come up in patent infringement litigation and not in a PTAB invalidity proceeding. So bear with us.

On February 22, the Court issued its decision in Life Technologies Corp. v. Promega Corp. The issue was whether a manufacturer of genetic testing toolkits could be liable for infringement where only one of the five key components—albeit an important one—was manufactured in the United States. The Court construed section 271 (f)(1) of the Patent Act, which prohibits the supply from the United States of “all or a substantial portion of the components of a patented invention” for combination abroad. Resorting to classic tools of statutory construction, the Court said that the section of the law required a quantitative analysis—and “all or a substantial portion” could never be merely one component in  a multi-component accused product.

Note that another section of the Patent Act—271(f)(2)—would allow an infringement suit where only one component was manufactured in the United States, but only where that single component is “especially made or especially adapted for use in the invention and is not a staple article or commodity.”

Now back to PTAB blogging!

Proving Public Accessibility of Printed Publications at the PTAB

Santeri Viinamäki [CC BY-SA 4.0], via Wikimedia Commons

Recent PTAB decisions have shown that a number of hurdles need to be cleared to successfully rely on printed publications as prior art in IPR, CBM, or PGR challenges. These challenges include proving that the reference was publicly accessible, that the copy relied on is authentic, and the publication date.

This post focuses on public accessibility. To show this, the proponent must evidence that the publication was sufficiently disseminated, or otherwise made available such that a person of ordinary skill in the art (POSITA), exercising reasonable diligence, could locate it. This standard is somewhat ambiguous, but recent decisions have shown that the PTAB has been applying it quite strictly. For example, the fact that a printed publication is shown to be posted and retrievable over the internet does not mean that the reference is per se accessible by a POSITA, as held in Blue Calypso v. Groupon (Fed. Cir. 2016). There, despite testimony that the printed publication (a graduate student’s report) was posted online, the PTAB held, and the Federal Circuit affirmed, that there was no proof that the reference was actually viewed or downloaded by an interested artisan, and therefore refrained from considering its information.

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Arctic Cat Chills Polaris’ Secondary Considerations

Polaris RangerIn Arctic Cat, Inc. v. Polaris Industries, Inc. (IPR2015-01789), the Board again examined secondary considerations of non-obviousness but found them to be unpersuasive because “the claims capture features largely well-known in the art” and the commercial embodiments “[include] important unclaimed features.” In stark contrast to the simple bottle cap in World Bottling Cap v. Crown Packaging Technology, the alleged commercial embodiments of the claimed invention in this case are complex vehicles – the Polaris RZR XP 900 and XP 1000. As secondary considerations of non-obviousness, the Patent Owner asserted both commercial success and industry praise of these Polaris vehicles.

To show nexus, the Patent Owner provided claim charts mapping all the features of certain claims to the Polaris vehicles. Further, the Patent Owner cited to “significant sales” of the Polaris vehicles as commercial success, and provided several advertising brochures and literature touting various benefits of these vehicles. The Patent Owner relied on, for example, the Polaris vehicles’ “rear suspension,” as claimed in the patent, as being a part of their success.

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Trying to show obviousness? Provide good, articulated reasoning—and prove that the combination will actually work.

checklistObviousness can be an unpredictable ground for challenging the validity of a patent. Superficially, obviousness may appear to be somewhat subjective, but it must be based on objective facts that prove that the combined references really can operate together. The courts and PTAB continue to refine the obviousness standard, clarifying how to fall under an appropriate obviousness rationale. Two recent cases from the Federal Circuit and PTAB show how not to argue a proposed modification or substitution. The takeaway message from these cases is loud and clear: to establish obviousness, articulate good reasoning for why a person would have combined prior art elements to arrive at the claimed invention and show that the combination actually works.

Almost 10 years ago, the Supreme Court in KSR confirmed that whatever the rationale used in an obviousness analysis, mere conclusory statements cannot suffice. Instead, there must be some explicit, articulated reasoning with some rational underpinning to support the legal conclusion of obviousness. The Court advised that it can be important to identify a reason that would have prompted a person of ordinary skill in the relevant field to combine the prior art elements in the way the claimed invention does. More than ever before, this guidance is relevant in establishing obviousness, as shown in the following two cases.

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Secondary Considerations Save the Day for Bottle Cap Patent

bottle capsIn World Bottling Cap v. Crown Packaging Technology, the PTAB relied upon the patent owner’s “compelling evidence of secondary considerations” to uphold the patentability of a bottle cap patent. The patent claimed a seemingly simple invention, a bottle cap made from steel that is thinner and harder compared to that of conventional caps. All elements of the claims were disclosed by the prior art, and the parties agreed that the purported advantage of the invention, the use of less steel per cap (referred to as “lightweighting”), was a known industry trend. In many cases, this would be the end of the road for the challenged claims. However, the PTAB weighed the patent owner’s evidence of secondary considerations against the petitioner’s prima facie case of obviousness and, in a rare instance, found that secondary considerations saved the day for the patent.

The PTAB found there was a strong correlation between the claimed invention and the proffered secondary considerations. It noted that the patent owner’s evidence of nexus (inventor testimony and documents listing specifications for the commercial caps) showed that the claimed invention was the entirety of the commercial product and not just a subcomponent. Accordingly, the PTAB “consider[ed] the evidence of the success and praise of the [commercial] cap as direct evidence of the success and praise of the claimed invention.”

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Keys to the PTAB do not open the Federal Circuit door

house keysUnder the AIA statute, anyone may file an IPR petition with the PTAB.  So presumably anyone who challenges a patent in IPR and loses can appeal to the Federal Circuit, right?  As one of my fellow bloggers would say, “Not so fast, my friends!”

While anyone may file an IPR petition, not all may pursue an appeal of an adverse PTAB decision.  According to a recent decision by the Federal Circuit, a petitioner must prove that it has a concrete stake in the outcome of the proceeding in order to have standing on appeal.  While standing is not necessarily required to appear before an agency (like the PTAB), it is a requirement for pursuing an appeal of an agency decision in federal court.

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PTAB Brews a Bitter Cup for Keurig (IPR2016-1390 et al.)

coffee-beansKeurig Green Mountain, vendor of the well-known Keurig brand of single-cup coffee brewers, brought five separate IPR challenges to four beverage brewing system patents owned by Touch Coffee and Beverages. In early January, the PTAB refused to institute review of most of the claims, concluding that Keurig failed to provide a rationale for the allegedly obvious combination. The lesson here: Whether a coffee brewer or not, you need to have good grounds to combine references.

Where did Keurig fail? The PTAB decisions, boiled down to their essence, are based on three reasons: (1) The references, if combined, would have needed further modifications to work. The petitioner expert failed to offer a “reason to make all the modifications needed to make the combination work as intended.” (2) The proposed combination would have eliminated the primary benefit of one of the references—why would a person use a reference whose benefit disappeared when combined with another? (3) Petitioner offered only one reason to combine the references, but that function was satisfied by the second reference standing alone—so why combine?

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Keep a Combo in Your Back Pocket!

cards in pocketHere is the situation: Your client has been sued in federal court for patent infringement. Your client and your expert give you four prior art references, A, B, C, and D. Either A+B or C+D looks like a pretty good combination to invalidate the primary independent claims of the asserted patent. Should you present both combinations to the PTAB? Makes sense, doesn’t it, to have two arrows in your IPR invalidity quiver? Or does it? Being a careful lawyer, you consider the kind of estoppel you might encounter if you were to hold one reference back as a precaution. Section 315(e)(2) of the U.S. Code is a starting point: “the petitioner in an [IPR] that results in a final written decision … may not assert[] in a civil action … that the claim is invalid on any ground that the petitioner raised or reasonably could have raised during that [IPR].” At first reading, that looks like you better raise both combinations—each one “reasonably could [have been] raised.” And if you don’t raise it, you lose it.

But wait. Not so fast my friends.

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En Banc Panel to Hear IPR Time-Bar Appeal

On petition for rehearing, an en banc Federal Circuit recently agreed to answer whether the statutory time-bar for instituting inter partes review (IPR) proceedings under 35 U.S.C. § 315(b) is subject to judicial review. In accordance with the IPR statute, “[t]he determination by the Director whether to institute an [IPR] … shall be final and nonappealable.” The petitioner Wi-Fi’s challenge of this seemingly insurmountable preclusion to judicial review is not the first. The Federal Circuit already held that section 314(d) “prohibits [review of] the Board’s determination to initiate IPR proceedings based on its assessment of the time-bar of § 315(b), even if such assessment is reconsidered during the merits phase of proceedings and restated as part of the Board’s final written decision.”

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Common Sense Is More than Intuition!

touchscreenIn an opinion dated January 3, 2017, In Re: Marcel Van Os et al., No. 2015-1975, the Federal Circuit reversed a PTAB decision affirming an examiner’s rejection of a touchscreen interface claim. The examiner and the PTAB said that it would have been “an intuitive way” for users of one prior art device to perform the activity claimed by the patent by combining a second reference that disclosed that activity.

Is “intuition” enough to satisfy KSR? Not so fast, my friends.

Even under KSR’s generous “common sense” rationale for combining references, a factfinder has an obligation “to provide reasoned analysis”—something explicit and grounded in facts. What is the “actual reason why a skilled artisan would have combined the references in the manner claimed?”

The lesson for practitioners seeking to invalidate under KSR‘s “common sense” rationale? Intuition is not enough. Provide detailed reasons why an artisan would combine. Articulate the benefits of the combination. Identify the problem to be solved and why the combination solves the problem. Explain that the consequences of the combination are predictable, requiring little if any experimentation.

Intuition is for romantics. Facts are required for patent practitioners.