Last year marked the fifth anniversary of the Supreme Court landmark decision in KSR v. Teleflex (April 30, 2007), when the United States Supreme Court addressed the obviousness of patents under 35 U.S.C. § 103 for the first time since Graham v. John Deere in 1966.
A few trends in the law of obviousness as pertaining to chemical innovations were readily apparent in 2012. Pharmaceutical patent holders in litigation fared well at the Federal Circuit, while patent holders appealing decisions from the Board of Patent Appeals and Interferences fared poorly, and a third more subtle trend suggests chemical patents in district court litigation may be less susceptible to invalidation for obviousness post-KSR.
In Part I of this article we explored the trends in pharmaceutical litigation during 2012. In this second and final segment we focus on PTO Board decisions and appeals from non-pharmaceutical litigation relating to chemical patents.
Last year marked the fifth anniversary of the Supreme Court landmark decision in KSR v. Teleflex (April 30, 2007), when our nation’s highest court addressed the obviousness of patents under 35 U.S.C. § 103 for the first time since Graham v. John Deere in 1966. But the patent-at-issue in KSR was mechanical. Patent holders in the chemical arts were wondering whether (more akin to hoping?) KSR’s loosening of the obviousness analysis might have less impact on chemical / pharmaceutical inventions, as opposed to mechanical inventions, because of inherent unpredictability in the art of the former. As we enter 2013, we think this is a good time to review Federal Circuit decisions from the last twelve months to discern trends and patterns in the post-KSR obviousness analysis of chemical patents.
A few trends were readily apparent in 2012. First, pharmaceutical patent holders in litigation fared well – in a series of cases, the Federal Circuit rejected obviousness attacks in pharmaceutical patent challenges on appeal from the district courts. Second, patent holders appealing decisions from the Board of Patent Appeals and Interferences (whether it be an original application, a reexamination, or a reissue) fared poorly – the Federal Circuit affirmed several Board decisions finding chemical patent claims obvious. While these trends are not surprising, a third more subtle trend suggests chemical patents in district court litigation may be less susceptible to invalidation for obviousness post-KSR. In 2012, when the Federal Circuit reversed the obviousness decision below on a chemical patent, those reversals favored non-obviousness three to one.
Our review lends itself to dividing the 2012 Federal Circuit obviousness decisions in chemical cases in three different categories: appeals from i) pharmaceutical litigation, ii) PTO Board decisions, and iii) non-pharmaceutical litigation over chemical patents. What follows is our review of appeals from pharmaceutical litigation. Part II of the article will focus on PTO Board decisions and appeals from non-pharmaceutical litigation relating to chemical patents.
The Board recognized multiple characteristics that differentiate the claimed invention in the “674 patent from the prior art combination of Song and Handong. Among these, the Board specifically determined that the claimed invention possessed a “supporting arm” and that the safety wheels of a resultant combination of Song and Handong would be raised off the ground, unlike what is depicted in the ‘674 patent and recited in the claims. Still, the panel determined that the claims were invalid. How is it possible to find an invention obvious when not all of the elements are within the prior art? This is unfortunately a disturbing trend that has been brought about by a misreading of KSR.
I have been doing a lot of research and writing on obviousness and KSR v. Teleflex lately, but not for publication on the blog so far. Last Friday, July 6, 2012, I filed a petition for rehearing en banc in Plasmart v. Kappos. I represent the Appellee-Patentee. The case arose out of what was originally an inter partes reexamination of U.S. Patent No. 6,722,674. The patent examiner found some of the claims allowable, the Board found all of the claims allowable, and then in a nonprecedential opinion the Federal Circuit overturned the Board.
This case intrigued me from the start because it seemed rather odd that there should be a nonprecedential opinion in an appeal to the Federal Circuit necessitated by a completely adjudicated inter partes reexamination at the United States Patent and Trademark Office. Moreover, the original panel concluded that the combination of known elements resulted in a predictable result. The problem with that reasoning, however, is that not all of the elements were found within the prior art. In fact, the Board found that there are no fewer than three (3) meaningful structural differences between the invention as claimed and the prior art.
The 5th anniversary of the Supreme Court’s KSR Int’l Co. v. Teleflex, Inc., 550 U.S. 398 (2007) decision is on April 30th. This is a good time to review the implications of this case, but an even better time to look into the origins and constitutionality of the Non-obviousness requirement. You might object that the jurisprudence of the non-obviousness requirement is so well established that nothing can be learned from this sort of analysis. I disagree. Patent law is under assault by the Supreme Court, the media, the ‘information wants to be free’ crowd, multinational corporations, and the economics profession. If we attempt to explain patent law based on the decisions of people who never passed the patent bar, never wrote a patent, never prosecuted a patent, and do not have a technical background, we are doomed. We need to define patent law as a natural law/right based on certain fundamental truths. This is the only way to get the non-patent attorney judge or the general public to understand patent law and understand that it represents justice. It is also why many of my comments and posts appear repetitive. For a list of some of the fundamental principles of patent law please see Foundations of Patent Law.
Holding in KSR
The holding in KSR was confused, but is generally accepted as stating that the teaching, suggestion, motivation rule (TSM rule) is not the only rule for determining if an invention is obvious. What other standards the courts and the PTO should use was somewhat nebulous, but clearly the three prong test of Graham v. John Deere Co., 383 U.S. 1 (1966) is still valid. In addition, the Supreme Court seemed to adopt the ‘I know it when I see it’ standard to obviousness. The decision overturned the relatively objective TSM test for a subjective non-test.
On Monday, April 30, 2007, the United States Supreme Court issued its final decision in the matter of KSR v. Teleflex, which overruled the Federal Circuit’s application of the so-called “teaching, suggestion, motivation” rule (or simply TSM) as it applies to determining whether an invention is obvious. This 5th Anniversary of the ruling provides an opportunity to revisit the decision and where we have come since. This will be a recurring theme this week on IPWatchdog.com as we look at the law of obviousness in the wake of this infamous decision.
At least for the last generation (and likely longer) no other Supreme Court case in the patent arena has been nearly as influential as the Court’s decision in KSR v. Teleflex. This is because obviousness is where the rubber meets the road for the patentability of inventions. It is not enough that the invention is different; it also must also be non-obvious. TSM sought to inject objectivity into the obviousness analysis, and did so rather successfully. There were from time to time patents granted on inventions that would make you scratch your head and wonder, but was that any reason to remove objectivity from the obviousness analysis? No, but that is what the Supreme Court did when they issued the KSR decision, taking many by surprise.
In the recent patent case of Mayo vs. Prometheus Labs, the United States Supreme Court continued its pattern of restricting the scope of patentable subject matter under 35 US 101. Historically, patents had been strictly limited to processes, machines, compositions of matter and articles of manufacture. Excluded from eligibility were business methods, software, laws of nature, naturally occurring phenomena and mathematical formulas. Then the US Court of Appeals for the Federal Circuit began to expand the patent eligibility rules.
In Diamond v. Diehr, decided in 1981 by the United States Supreme Court, established that an un-patentable formula could be transformed into a process by the addition of method steps after the formula. Most would agree, however, that software did not widely become patent eligible until 1994 when the Federal Circuit in the Alappat case held that a programmed computer was essentially a machine and when that same computer was programmed differently, it became a second different machine – both patentable. The Alappat holding led to the acceptance of “software plus token hardware” as being patentable. Ultimately, the Alappat ruling would give rise to the State Street Bank case, decided in 1998 by the Federal Circuit, which held that business methods were patentable.
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