Litigating non-obviousness after KSR v Teleflex
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1 Feature Litigating non-obviousness after KSR v Teleflex The Supreme Court s KSR decision changes what is required to demonstrate the obviousness of a patent claim and thereby show it is unpatentable. As obviousness is raised in almost all patent infringement cases, KSR s principles should be taken into account when planning a litigation strategy. By J Steven Baughman, David Brightman and Hiroyuki Hagiwara, In April 2007, the US Supreme Court issued a decision that may make it easier for defendants to invalidate some patents, in court or in the Patent Office, and harder for companies to obtain patents in the first place. This decision, KSR International Co v Teleflex Inc et al, 127 S Ct 1727 (2007), changes what is required to demonstrate the obviousness of a patent claim and thereby show it is unpatentable. Although the lasting effect of this change in the law is uncertain, it is clear that both plaintiffs and defendants should consider changes in their strategic approach to patent litigation as a result of the KSR decision. The obviousness doctrine Under US patent law, a person is entitled to obtain a patent for an invention that is novel, has utility and is not obvious. By statute, a claim is unpatentable as obvious if the differences between the invention sought to be patented and the prior art are such that the invention would have been obvious at the time it was made to a person having ordinary skill in the art to which the invention pertains. (In an issued patent, a claim is invalid if it is found to be obvious.) This fictitious person having ordinary skill in the art is considered to be a typical scientist or engineer in the pertinent field who is presumed to have knowledge of all of the relevant prior art. In Graham v John Deere Co, 383 US 1, 86 S Ct 684 (1966), the Supreme Court established a framework for analysing obviousness: Determine the scope and content of the prior art. Determine the differences between the prior art and the claims in issue. Determine the level of ordinary skill in the pertinent art. Evaluate the objective evidence (secondary considerations). The Court provided examples of objective evidence, including the commercial success of the invention, whether the invention met a long-felt need in the industry, copying of the invention by the defendant, praise for the invention, failure by others to solve the problem solved by the invention, scepticism of the invention by experts and unexpected results. Any of these facts tends to show that an invention was not obvious at the time of invention. (For example, as a general matter, if an invention is commercially successful, it is less likely to have been obvious at the time otherwise someone else would have created and marketed it.) Typically, a defendant accused of patent infringement will argue that a claim is obvious because one of ordinary skill in the art would have combined two or more prior art references to arrive at the claimed invention. However, because each element in a patent claim can usually be found somewhere in the prior art, merely pointing to a combination of references that discloses all of the claim s elements has not been considered sufficient to prove obviousness. To prevent such hindsight reconstruction of the claimed invention, the Federal Circuit the US appellate court that handles all patent cases has historically applied a teaching-suggestion-motivation (TSM) test. This test requires that the 44 Patents in the USA
2 defendant identify some explicit teaching, suggestion or motivation that would have led a person of ordinary skill in the art to combine the relevant prior art references to achieve the claimed invention. Many decisions refusing to invalidate patents for obviousness have relied upon the absence of a teaching, suggestion or motivation to combine references. Although patents have been invalidated based on an argument that the suggestion to combine arose from the knowledge of one of ordinary skill in the art, typically the TSM test has been strictly interpreted to require an explicit suggestion. The KSR decision In KSR, the Supreme Court held that the Federal Circuit had applied the TSM test in too narrow and rigid a manner. The Federal Circuit had reversed a trial court s holding that the asserted patent was obvious, reasoning that the trial court had not specifically found a teaching, suggestion or motivation to combine the prior art references to arrive at the patented invention. The Federal Circuit further held that because the prior art references addressed different problems from those addressed by the asserted patent, the references could not themselves supply the teaching, suggestion or motivation for their combination into the claimed invention. The Supreme Court disagreed with this treatment of the Federal Circuit s TSM test as a rigid and mandatory formula for determining obviousness, and disagreed that the court could consider only prior art references relating to the particular problem the patentee was trying to solve. It reversed the Federal Circuit s decision and sent the case back to the Federal Circuit for a new obviousness analysis. The Supreme Court acknowledged that the TSM test captures a helpful insight that a patent composed of several elements is not proved obvious merely by demonstrating that each element was, independently, known in the prior art. It also acknowledged that the TSM test can be compatible with the Graham analysis. However, the Court reasoned that the obviousness analysis cannot be confined by a formalistic interpretation of the words teaching, suggestion and motivation, or by over-emphasising published articles and the explicit content of issued patents. The Court concluded that a rigid application of the TSM test improperly denies the use of common sense. According to the KSR decision, the obviousness analysis does not have to seek precise teachings directed to the specific subject matter of the challenged claim. A court or patent examiner can take account of the inferences and creative steps that a person of ordinary skill in the art would employ. A court or examiner may also consider the interrelated teachings of multiple patents and the effects of demands known to the design community or present in the marketplace in order to determine whether there was an apparent reason to combine the known elements in the fashion claimed by the asserted patent. Rationales for finding obviousness articulated in KSR The TSM test is not dead it remains a valid path for demonstrating that a claimed invention is obvious. The Supreme Court recited a number of other rationales that a court or examiner can rely upon to find that a claimed invention is obvious, such as when: The claim combines familiar elements according to known methods to yield predictable results. The claim simply substitutes one known element for another to obtain predictable results. The claim uses a technique known to improve similar devices (methods or products) in the same way. The claim applies a known technique to a device or method that was ready for improvement to yield predictable results. It would have been obvious to try the claimed invention if there were a design need or market pressure to solve a problem and there were a finite number of identified, predictable solutions that one of ordinary skill in the art would have had good reason to pursue, and that were within his or her technical grasp. The claim is a variation of known work in one field of endeavour prompted for use in either the same field or a different one based on design incentives or other market forces, if the variations would have been predictable to one of ordinary skill in the art. KSR s effect on plaintiffs strategy Plaintiffs should consider a number of adjustments to their patent litigation strategy in light of KSR. These include the following. Consider which patents to assert with more care Under KSR, defendants may have stronger arguments for invalidating a patent for Patents in the USA
3 obviousness. Plaintiffs should therefore exercise more care in deciding which patents to assert, which claims to assert and even whether to file suit at all, especially where the financial burden of patent litigation is an issue. Prior art that was cited during prosecution is not normally relied upon to invalidate a patent in litigation because there is a presumption that the US Patent and Trademark Office examiner considered it and granted the patent anyway. But now, defendants may likely argue that such prior art is relevant because the examiner would not have granted the patent under the broader obviousness rationales articulated in KSR. Plaintiffs should analyse the arguments that can be made under the cited prior art and may also want to conduct their own searches for new prior art with the broader obviousness standard in mind. Develop a strong story showing the genius behind the invention To counteract the multiple arguments for obviousness that defendants are likely to assert under KSR, it is even more important now for plaintiffs to be prepared to give testimony to present a compelling invention story. It helps significantly at trial if a plaintiff can demonstrate that its invention is the product of a great scientist s mind, years of hard work and substantial investments in the relevant research and development. Focus discovery and expert testimony Plaintiffs should tailor their discovery efforts and expert testimony to address the rationales discussed in KSR. Plaintiffs should prepare to defend against each of the arguments suggested by KSR, including gathering and presenting supporting evidence and testimony. Emphasise objective evidence of nonobviousness Plaintiffs should also focus discovery and expert testimony on objective evidence of non-obviousness. This should include investigating what their own documents show, what their employees know and what the defendant s and third parties documents and witnesses can contribute. Resist an exaggerated level of skill for the person of ordinary skill in the art The lower the level of ordinary skill, the lower the likelihood that the claimed invention will be found obvious. KSR states, for instance, [i]f a technique has been used to improve one device, and a person of ordinary skill in the art would recognize that it would improve similar devices in the same way, using the technique is obvious unless its actual application is beyond his or her skill. If the level of ordinary skill is defined to be less advanced, then it is more likely that the application of one technique for improvement of one device to another device will be beyond that skill. Similarly, an invention may not be found obvious to try if the set of identifiable, predictable solutions is beyond the person of ordinary skill s technical grasp. All of this underscores the importance to plaintiffs of resisting a defendant s efforts to inflate artificially the level of ordinary skill. J Steven Baughman is a partner in s intellectual property group and has experience litigating intellectual property and complex technology-based commercial disputes in a wide range of industries. He is based in the firm s Tokyo office. J Steven Baughman Partner steven.baughman@ropesgray.com Tel: Tokyo David Brightman is an associate in s intellectual property group. His practice focuses on patent litigation and patent analysis for infringement and validity opinions, corporate due diligence and client counselling. He is based in the firm s Silicon Valley office in Palo Alto, California. David Brightman Associate david.brightman@ropesgray.com Tel: Palo Alto 46 Patents in the USA
4 Anticipate an early defence motion for summary judgment of invalidity Under KSR, defendants may be more likely to succeed on motions for summary judgment of invalidity based on obviousness. In addition, the Supreme Court s confirmation that the determination of obviousness is a legal determination may increase the number of summary judgments of obviousness. The defendant may file such a motion very early in the case because it does not depend upon discovering information from the plaintiff (although the defendant will have to refute the objective evidence of nonobviousness that many plaintiffs will present). The defendant needs only the prior art that invalidates the claim, and perhaps the declarations of one or more of its own expert witnesses. Plaintiffs should thus take discovery to prepare their non-obviousness arguments early in the case. Emphasise the statutory presumption of validity, the clean and convincing evidence requirement, and caution against the use of hindsight In parallel with presenting objective evidence of non-obviousness, plaintiffs should emphasise the Supreme Court s warning against using hindsight in finding an invention obvious. In addition, KSR did not abolish or affect the statutory presumption of patent validity and the defendant s burden of of proving patent invalidity by clear and convincing evidence. The court and the jury should be reminded of these important legal standards in motions and at trial. KSR s effect on defendants strategy The strategic adjustments defendants should consider include the following. Focus more resources on investigating and developing obviousness arguments Because KSR makes it easier to invalidate a patent for obviousness, this becomes a more likely path to victory for defendants. Defendants should spend more time and resources investigating the prior art and developing obviousness arguments. Plan to file an early motion for summary judgment See above. Have an expert consider all sources of a reason to combine references and all obviousness rationales articulated in KSR After KSR, an expert witness will likely find it easier to identify and express a reason that one of ordinary skill in the art would have found the claimed invention to be obvious. The expert no longer has to identify an explicit teaching, suggestion or motivation to combine references; nor is he limited to looking at the prior art references themselves. He may rely more upon common sense, market pressures, consumer demand, the nature of the problem at hand and the knowledge and creativity of a person of ordinary skill in the art to find a reason to combine them. Indeed, under KSR it may not be necessary to combine prior art references in the first place, and defendants should consider whether their expert can help support an argument that a single piece of prior art, when viewed with the common sense, creativity and knowledge available to one of ordinary skill, renders a claimed invention obvious. Argue for an appropriately high level of ordinary skill For the reasons discussed above, the level of ordinary skill applied by a court in a particular case can play a very important role in determining the success or failure of the arguments suggested by KSR. Anticipate the patentee s reliance on objective evidence of non-obviousness Defendants should recognise that plaintiffs are likely to focus more resources on developing evidence and testimony to demonstrate objective indicia of nonobviousness. Defendants may need to devote Hiroyuki Hagiwara is a partner in s Intellectual Property Group and a member of the firm s international practice group. He focuses on patent infringement litigation, patent licensing and counselling on legal issues involving patents and technologies. He is based in the firm s Tokyo office. Hiroyuki Hagiwara Partner hiroyuki.hagiwara@ropesgray.com Tel: Tokyo Patents in the USA
5 more resources to refuting such arguments. Appeal to common sense Use of common sense to determine whether an invention is obvious is a theme that runs throughout the KSR decision. Regardless of which rationale for obviousness defendants choose to argue, common sense would be a good thematic accompaniment. Defendants may also find other turns of phrase in the KSR decision helpful in setting the tone for a favourable outcome on obviousness. In settlement discussions, negotiate with KSR in mind The KSR decision gives defendants more leverage in settlement discussions. Plaintiffs face not only a higher chance of losing their case if it goes to trial, but also a higher risk of losing their patents in a determination of invalidity. Dealing with an uncertain future It remains to be seen exactly how the Federal Circuit and the trial courts will interpret and apply the KSR decision. Some authorities claim KSR will have limited impact. Others have said that KSR is one of the most important developments in patent law in decades. Regardless of how KSR s history ultimately unfolds, however, obviousness is raised in almost every patent infringement case, and every plaintiff and defendant would be well advised to take the principles articulated in KSR into account when planning a litigation strategy. 48 Patents in the USA
6 Firm directory Alston & Bird LLP Bank of America Plaza, 101 South Tryon Street, Suite 4000, Charlotte, NC 28280, Tel: Fax: Web: Other offices: Atlanta, New York, Washington DC, Dallas, Research Triangle Park Harness, Dickey & Pierce, PLC 5445 Corporate Drive Troy, MI Tel: Fax: Web: Other offices: St Louis, Washington, DC Patton Boggs LLP 8484 Westpark Drive, Ninth Floor McLean, Virginia 22102, Tel: Fax: Web: Other offices: Abu Dhabi, Anchorage, Dallas, Denver, Doha, New Jersey, New York, Washington, DC Baker, Donelson, Bearman, Caldwell & Berkowitz, PC Commerce Center, Suite 1000, 211 Commerce Street, Nashville, TN 37201, Tel: Fax: Web: Other offices: Alabama, Georgia, Louisiana, Mississippi, Washington, DC, Beijing (representative office) Oblon, Spivak, McClelland, Maier & Neustadt, PC 1940 Duke Street, Alexandria, VA 22314, Tel: Fax: Web: Yusen Building 2F 3-2 Marunouchi 2-Chome Chiyoda-ku, Tokyo , Japan Tel: Fax: Web: Other offices: Boston, Chicago, Hong Kong, New York, Palo Alto, San Francisco, Tokyo, Washington, DC, London. Cadwalader, Wickersham & Taft LLP One World Financial Center New York, NY 10281, Tel: Fax: Web: Other offices: New York, Washington, DC, London, Charlotte, Beijing. Ocean Tomo 200 West Madison, 37th Floor, Chicago, IL 60606, Tel: Fax: Web: Other offices: Orange County, Palm Beach, San Francisco, Washington, DC TAEUS International Corporation 1155 Kelly Johnson Blvd, Suite 400 Colorado Springs, CO 80920, Tel: Fax: Web Other offices Silicon Valley, Indianapolis, London, St Petersburg, Tokyo, Seoul, Taipei, Beijing, Hong Kong 58 Patents in the USA
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