Federal Circuit Agrees with PTAB that Firebug’s Footwear Claims Are Obvious

On June 25, the U. S. Court of Appeals for the Federal Circuit (CAFC) affirmed an appeal from two final written decisions of the United States Patent and Trademark Office’s Patent Trial and Appeal Board (PTAB) in Shoes By Firebug LLC v. Stride Rite Children’s Group, LLC, wherein the CAFC held that the PTAB did not err in concluding that the claims of two patents owned by Shoes by Firebug (Firebug) were obvious in view of the prior art.

Proceedings Before the PTAB

Firebug owns U.S. Patent 8,992,038 (the ‘038 patent) and U.S. Patent 9,301,574 (the ‘574 patent), which are directed to “improved structure[s] for internally illuminated footwear.” Firebug asserted the ’038 and ’574 patents in an infringement suit against Stride Rite Children’s Group, LLC (Stride Rite) in the U. S. District Court for the Eastern District of Texas and Stride Rite responded by filing petitions for inter partes review (IPR) of claims 1–10 of the ’038 patent and claims 1–10 of the ’574 patent with the PTAB. Stride Rite asserted that the challenged claims would have been obvious over U.S. Patent 5,894,686 (Parker) in view of U.S. Patent App. Pub. 2011/0271558 (Rosko). In particular, Stride Rite argued that it would have been obvious to substitute an optical fiber layer, as taught in Parker, with an LED-based light diffuser, as taught in Rosko, “to reduce cost and improve the structural integrity of the footwear” Parker.

The Board issued a final written decision in each proceeding concluding that (1) the preamble of claim 1 of each of the Firebug patents did not limit the challenged claims, (2) the challenged claims were obvious in view of the references and (3) Firebug’s evidence of secondary considerations of nonobviousness did not outweigh the disclosure of the references.   Firebug appealed to the CAFC.

CAFC’s Review of Claim Construction

Initially the CAFC considered Firebug’s argument that the Board erred in determining that the preamble of claim 1 of each of the Firebug patents, which recited “[a]n internally illuminated textile footwear comprises,’” did not limit the claims. Specifically, Firebug argued that the claims should be limited to “textile footwear” as recited in the preamble. The CAFC disagreed with Firebug regarding claim 1 of the ‘038 patent but agreed with respect to the ‘574 patent. Noting that the body of claim 1 of the ‘038 patent recites “a footwear” and does not recite any specific material for the footwear, the CAFC explained that the body of claim 1 of the ’038 patent recited “a structurally complete article.” Thus, the CAFC concluded that PTAB correctly determined the preamble of claim 1 did not limit claims 1–10 of the ’038 patent.

With respect to claim 1 of the ’574 patent, the CAFC noted that the body of the claim did not reintroduce “footwear”, but rather relied on the “footwear” in the preamble for antecedent basis. The CAFC explained that “[w]hile antecedent basis alone is not determinative of whether a preamble is limiting, use of preamble terms to define positive limitations in the body of claims can evince an inventor’s intent that the preamble limit the scope of the claim. That is the case here.”  The CAFC concluded that the preamble was “essential to understanding the structural limitations of the illumination system” and, therefore, the preamble of claim 1 of the ’574 patent limited the scope of claims 1–10 of the ’574 patent. However, even though the PTAB erred in omitting the preamble in the claim construction of the ‘574 patent, the CAFC determined that the error was harmless because the ultimate conclusion of obviousness was correct.

Consideration of Obviousness

Firebug also argued that the combination of Parker and Rosko failed to disclose a “claimed interfacing layer because the ‘back reflector’ of Parker is a permanently fixed coating of Parker’s optical fibers and would not be retained if the optical fibers were replaced by Rosko’s LEDs, as proposed by Stride Rite.”  In response, Stride Rite countered that the PTAB’s conclusion that Parker and Rosco disclosed the interfacing layer was supported by substantial evidence. The CAFC noted that the parties presented “two alternative theories as to whether a skilled artisan would or would not have substituted Rosko’s LED’s for Parker’s optical fibers.”  However, the CAFC explained that its task was “not to determine which theory is more compelling” or to “second-guess the Board’s assessment of the evidence.”  Rather, the Board stated that “the only question before us is whether the conclusion adopted by the Board [was] supported by substantial evidence.”  The CAFC agreed with the PTAB that Stride Rite’s proposed combination of Parker and Rosko “accounted for the claimed interfacing layer and that Stride Rite had articulated sufficient reasons to combine the known elements in the claimed arrangement.”  Thus, the CAFC determined that the PTAB’s conclusion of obviousness was supported by substantial evidence.

Firebug also asserted that the PTAB failed to properly consider the evidence of secondary considerations of nonobviousness because it did not consider two license agreements that included the ’038 and ’574 patents. The CAFC explained that the agreements presented by Firebug included numerous intellectual property rights in addition to the ’038 and ’574 patents, therefore, “the agreements on their face [did] not establish a nexus between the commercial interest in Firebug’s products and the claims of the ’038 and ’574 patents.”  Regardless, the CAFC stated that it “need not determine whether the Board erred in determining that Firebug had not established nexus because the Board alternatively found that, even if nexus is presumed, Firebug’s evidence of secondary considerations is weak, and that conclusion is supported by substantial evidence.”  Thus, the CAFC found no error in the PTAB’s weighing of Firebug’s evidence of secondary considerations of nonobviousness or in the PTAB’s ultimate conclusion of obviousness.