Invention Obvious in Part Because Inventors Were Experts

Daiichi Sankyo v. Apotex (Fed. Cir. 2007).

Apotex filed an ANDA to begin making a generic version of Daiichi’s patented ear infection medication method – FLOXIN Otic. Daiichi sued and won a bench trial. On appeal, the CAFC reversed — finding the patented invention obvious.

Level of Skill: The nonobvousness doctrine requires an examination of what would be available to a person having ordinary skill in the art (PHOSITA). That inquiry is premised on a definition of the mythical PHOSITA.  The general theory is that highly educated and trained PHOSITA know more and tend to think more inventions are obvious. On the other hand, a PHOSITA with little education or training would have more difficulty in making connections and finding obviousness.

The 1983 Orthopedic Equipment decision outlines factors for determining a PHOSITA – including education level of the inventor.

Here, the CAFC found that the lower court erred by picking a pediatrician as the PHOSITA in creation of compounds to treat ear infections without damaging a patient’s hearing. Rather, the skill level should be an otologist who is engaged in developing pharmaceutical formulations. The court primarily based its PHOSITA Skill Level on the inventors’ skill level and the skill level of their peers (which, almost by definition will be the same).

Obviousness: Based on the high level of skill in the art, the CAFC concluded that an otologist would have found the patented method obvious.

Reversed — Patented Invention is Obvious

DDC Comment: Although the education level of the inventor appears to be relevant to determining the PHOSITA skill level, there are a few reasons why that data point should be excluded from the list of factors. The common major mistake here is to search for a PHOSITA capable of making the invention rather than simply searching for the level of a skilled worker in the area. The PHOSITA skill level inquiry is not a search for what it takes to be a successful inventor. Rather, the PHOSITA is merely a skilled worker.  The inventor’s biographical information may be indicative of a skill level for invention, but that is not the PHOSITA inquiry. 

Under 35 USC 103(a), patentability of an invention “shall not be negatived by the manner in which the invention was made.” Of course, the process of inventing is intimately tied-in with the inventor’s skill and education level. In essence, use of the inventor’s biographical information in determing the PHOSITA skill level allows the court to ask whether the invention would have been obvious to someone standing in the shoes of the inventor. That methodology nothing more than a backdoor approach to asking whether any steps that the inventor took included non-obvous leaps — a legally impermissible question.

Notes:

• This case was originally decided in July 2007, but was recently republished as a precedential decision. The OrangeBookBlog covered the original release.

KSR Extended to Obviate Component Purified from Known Mixture

Aventis Pharma & King Pharma v. Lupin Ltd. (Fed. Cir. 2007).

Altace is the King/Aventis brand of ramipril – a top-selling ACE inhibitor.  The patent claims ramipril formulated “substantially free of other isomers.” The district court found the patent not invalid, but only by a slim margin. On appeal the CAFC reversed – finding the patent invalid as obvious.

Prior Art: One reference (‘944 patent) was filed as a continuation-in-part of an already abandoned patent application. That application was eventually revived, but Aventis argued on appeal that the ‘944 patent should not be awarded the filing date of the parent.  The CAFC found this a potentially interesting argument, but refused to hear the argument because Aventis had failed to make the argument at the district court level.

The appellate panel also agreed that the experimental results of a Shering Doctor constituted 102(g)/103(a) prior art because the Doctor had not abandoned, suppressed, or concealed her prior invention.

Obviousness of a Purified Form: The district court, ruling pre-KSR, found the patent nonobvious. On appeal, the CAFC took a different view – finding that the purified form of a known mixture is prima facie obvious if a PHOSITA would have some reason to believe that the mixture derives properties from particular components.

However, if it is known that some desirable property of a mixture derives in whole or in part from a particular one of its components, or if the prior art would provide a person of ordinary skill in the art with reason to believe that this is so, the purified compound is prima facie obvious over the mixture even without an explicit teaching that the ingredient should be concentrated or purified.

The prima facie case of obviousness is especially difficult to rebut where, as here, the potency of the mixture varies directly with the amount of isomer in the mixture.

The court implicitly distinguished this case from Forest Labs — noting that obviousness may be rebutted by showing difficulty in purifying the mixture.

[A] purified compound is not always prima facie obvious over the mixture; for example, it may not be known that the purified compound is present in or an active ingredient of the mixture, or the state of the art may be such that discovering how to perform the purification is an invention of patentable

Reversed, Patent Invalid as Obvious

Reasonable Pertinence may be Sufficient to Combine References in Obviousness Rejection

In re Icon Health and Fitness (Fed. Cir. 2007).

ICON has been a party in more than 50 patent infringement lawsuits and has asserted its treadmill patent (5,676,624) against at least six defendants.  In the midst of litigation, ICON also filed for reexamination, and now appeals the PTO’s final rejection of its patent to the CAFC.

ICON admits that all but one of the claimed elements are disclosed in a Danmark International advertisement.  The remaining element, a gas stabilizing spring, is found in Teague where it is used to assist in opening and closing of a Murphy style bed.

Reasonably Pertinent Art: To be used in an obviousness rejection, prior art must be “reasonably pertinent to the problem addressed” by the patent applicant. Usually this is satisfied by references in the same field of technology or that address the same problem. Here, the CAFC saw enough similarity to find the bed art pertinent:

“Nothing about Icon’s folding mechanism requires any particular focus on treadmills; it generally addresses problems of supporting the weight of such a mechanism and providing a stable resting position. Analogous art to Icon’s application, when considering the folding mechanism and gas spring limitation, may come from any area describing hinges, springs, latches, counterweights, or other similar mechanisms—such as the folding bed in Teague.”

Although the patent applicant lost this argument, this portion of the case is good news for applicants – because of what the opinion did not say. Specifically, the court could have begun with the announcement that “In KSR, the Supreme Court expanded the notion of pertinent obviousness-type prior art when it announced that ‘patent examiners should look [beyond] the problem the patentee was trying to solve.’ . . .”  Instead, the CAFC decided to stick to its narrower jurisprudence.

All elements = Obvious: Under KSR, once the elements are shown in reasonably pertinent art, then an obviousness determination is as simple as connecting the dots. The court says as much:

[W]hile perhaps not dispositive of the issue, the finding that Teague, by addressing a similar problem, provides analogous art to Icon’s application goes a long way towards demonstrating a reason to combine the two references.

Here, the Court explained a connection be tween Teague and the claimed invention by showing that both used the spring in similar ways.

Notes:

• A report from Steve Sereboff indicates that the PTO has already taken this decision to heart in its new examiner training: “Basically, the examiners can make a prima facie case of obviousness simply by showing that all of the elements in the claim were known.”

Procedure: Expert Testimony Deserves Weight on Summary Judgment

Omegaflex v. Parker-Hannifin Corp (Fed. Cir. 2007) (nonprecedential)

On summary judgment, the Massachusetts District Court found the Omegaflex pipe-fitting patents novel, nonobvious and infringed. Parker appealed.

Respect the Expert: On several points of contention, the district court gave no probative weight to Parker’s expert’s testimony.  On summary judgment, the evidence should be weighed in the “light most favorable” to the non-movant (Parker). Because the expert testimony creates issues of material fact, the CAFC reversed and remanded.

In dicta, the three-member panel (Judges Michel, Dyk, and Garbis) probed the Supreme Court’s recent KSR decision — noting that it will continue to look for some reason to combine prior art references in an obviousness rejection.

Quoting KSR: “a patent composed of several elements is not proved obvious merely by demonstrating that each of its elements was, independently, known in the prior art.”

Reversed and remanded.

Zyprexa Patent Upheld on Appeal

Eli Lilly v. Zenith Goldline (Fed. Cir. 2006)

Lilly’s patent covers olanzapine (Zyprexa®) and its use for the treatment of schizophrenia. Three generic manufacturers (Zenith (IVAX), Dr. Reddy’s, and Teva) filed an ANDA and Lilly responded with a complaint in the Southern District of Indiana.  After a bench trial, the district court agreed with Lilly that the patent was valid, infringed, and enforceable.  The defendants appealed to the Court of Appeals of the Federal Circuit.

Anticipation: To anticipate the invention, a prior art reference “must disclose each and every feature of the claimed invention, either explicitly or inherently.”  However, in both Petering and Schaumann, prior art references that disclosed the family of the claimed compound were found to anticipate the claimed compound — even though the claimed compounds were not specifically discussed.

Here, the CAFC found that those cases were not applicable because the closest reference to olanzapine did not spell out “a definite and limited class of compounds that enabled a person of ordinary skill in the art to at once envisage each member in this limited class.”

Obviousness: The CAFC agreed that the prior art references did not suggest a the compound. In addition, Lilly provided strong evidence of secondary considerations, including: “(1) a long-felt and unmet need; (2) failure of others; (3) industry acclaim; and (4) unexpected results.”

The record shows a long-felt need for a safer, less toxic, and more effective clozapine-like drug; a decade (or more) of failure to find a replacement for clozapine; a reasonable amount of commercial success for olanzapine; and a number of awards for olanzapine as indicators of industry acclaim.

Public Use: Prior to filing the patent application, Lilly conducted Phase I clinical safety trials. The court found, however, that the trials were well within the experimental use exception:

In this case, Lilly tailored its tests to their experimental drug safety and efficacy purpose, adequately monitored for results, and maintained confidentiality throughout the duration of the study. The trial court did not err in finding no public use.

 

Scalia's Hint on KSR

As you read this, keep in mind Michael Slonecker’s recent remark that “predictions are the musings of fools.” In late November, the Supreme Court heard oral arguments in KSR v. Teleflex — the case that will determine what constitutes a “nonobvious” invention. Then, last week, Justice Scalia briefly discussed the case at a meeting of technology business group and was quoted as saying: “I know how that one comes out, but I'm not going to tell you.”  What does Scalia’s quote mean? Perhaps nothing, but it might mean that the court has already come to a unanimous consensus on the case.

Link: Washington Post Article

Supreme Court: Current Test of Obviousness is "Gobbledygook"

KSR v. Teleflex (Supreme Court 2006, Oral Arguments).

The doctrine of nonobviousness is the cornerstone of American patent law.  I was reminded today by Phil Swain that our nonobviousness statute, section 103(a) of the Patent Act, was drafted by Judge Giles Rich.  Judge Rich is the most celebrated patent judge of this century.  His statutory masterpiece eliminated the amorphous concept of a “flash of genius” and replaced it with our now ubiquitous objective standard of a person having ordinary skill in the art.  In Graham v. John Deere, the Supreme Court reinforced 103(a) with its concept of case-by-case consideration of secondary indicia of nonobviousness as a way to avoid potential hindsight bias. 

Later, as the Federal Circuit developed its own patent jurisprudence, the court hit upon the teaching-suggestion-motivation test as another anti-hindsight rule.  That test requires evidence of some reason to combine various references that each teach part of an invention.  Thus, if there is no evidenced reason to combine the references, then the invention will be deemed nonobvious. The test, known by acronymists as “TSM,” has been labeled as a poster-child for bad patent behavior.  According to opponents of the test, the bright-line test makes patents too easy to obtain — resulting in a glut of patents covering trivial improvements. Those patents, in turn, hold-up industry research and greatly increase transaction costs and legal fees. 

In KSR v. Teleflex, the Supreme Court is questioning whether the TSM test should exist as the sole determinant of obviousness.  Question presented:

Whether the Federal Circuit has erred in holding that a claimed invention cannot be held ‘obvious’, and thus unpatentable under 35 U.S.C. § 103(a), in the absence of some proven “‘teaching, suggestion, or motivation’ that would have led a person of ordinary skill in the art to combine the relevant prior art teachings in the manner claimed.”

Until a few months ago, the common myth of the TSM test was that it required at least some hard evidence that provided at least a minimal reason to combine various prior art references.  It is that myth that provided the impetus for Supreme Court review. In recent months, however, we have learned that the CAFC’s version of the test allows for evidence that is implicit, based on common knowledge, found generally in the prior art as a whole, based simply on the nature of the problem or simple logic, or concluded by experts. See Kahn, Dystar, Ormco, Alza.  This jitterbug by the CAFC actually gives KSR much of what it wanted and smears the edges of the mythical bright-line rule.  Justice Scalia picked up on transition during oral arguments — noting that the recent cases leave the test “meaningless. [The CAFC] essentially said ‘our test simply reduces to what [KSR seeks] in this litigation.’ . . . this is gobbledygook. It really is, it’s irrational.” Justice Alito had a similar concern with the “new” TSM test:

J. Alito: “But what is the difference between asking whether something is implicit in the, in the prior art and simply asking whether it would have been obvious to a person of ordinary skill in the art?:

As discussed earlier on Patently-O, all the major patent bar associations filed briefs that support the current TSM test.  In a brilliant move, KSR neutralized those briefs by implying bias based on “the enormous fees that litigation of invalid patent claims can generate.” KSR Reply Brf. CJ Roberts appeared to buy-in to that analysis, joking that the filings “just indicate[] that this is profitable for the patent bar.” KSR Oral Arg.

One concern of the Court is whether modification of the obviousness doctrine would spoil long-settled rights.  The Justices, however, mentioned on several occasions that over the past year, the CAFC may have already upset any settled rights.

Mr Goldstein [for Teleflex]: “[The CAFC has had decades to look at this to try and elaborate a standard.”
J Breyer: “And it so quickly modified itself.”

Decision in February: Reports from the hearing noted that Justice who used the term “TSM” spoke with disdain and were highly critical of the test.  Although oral arguments are always full of counterfactuals and wild theory testing, the level of criticism supports the conventional wisdom that the TSM test is likely to be eliminated as “the exclusive” test.  Cases will rather be decided on a case-by-case basis using the standards of Graham v. John Deere. Already issued patents will still be given a presumption of validity, although it will be difficult for some courts to do this with a straight face.  The new key to avoiding invalidity will be secondary indicia of nonobviousness. Look for a 9–0 decision in early February.

TSM is not Dead: Much of the oral argument was filled with an attempt to simply understand the TSM test, and to figure out what is meant by a “motivation.”  If they cannot figure-out the test, they would likely completely trash-it as unworkable. Of course, by the time the opinion is penned, they will understand the current test and the test will not be scrapped as a whole. Rather, they will follow the Government’s suggestion that TSM continue to be used as a “valid means of proving obviousness.” In addition, however, flexibility will be added to allow for other ways of determining nonobviousness.

Here are some quotes from oral arguments:

CJ Roberts: “[T]the Federal Circuit’s approach focuses . . . on prior art — as opposed to, I would say, common sense.” 

J Scalia: “And in the last year or so, after we granted cert in this case after these decades of thinking about [the obviousness doctrine, the CAFC] suddenly decides to polish it up.”

J. Breyer: “I’ve read it about 15 or 20 times now, I just don’t understand what is meant by the term ‘motivation.’”

Mr. Hungar [for US Gov’t]: “Construed as the sole means of proving obviousness the teaching suggestion motivation test is contrary to the Patent Act, irreconcilable with this Court's precedents and bad policy. It asks the wrong question and in cases like this one, it produces the wrong answer. It should be rejected and the judgment of the Court of Appeals should be reversed. . . . It’s just foreign to this Court’s precedents as a mandatory prerequisite for obviousness.”

Mr. Dabney [for KSR]: “[T]here is no legal regime that is a greater generator of patent litigation than the teaching suggestion motivation test that is urged by the respondent.” [DDC: Is this true?].

Documents and Links:

• Oral Argument Transcript;
• Commentary from the Gallery on the Oral Arguments:
• Zura;
• Armstrong;
• Miller;
• Kerr;
• ScotusBlog (Run by Teleflex’s Counsel)
• Gordon Smith;
• Patent Baristas;
• LawFont;
• Hawk;
• Brooks;
• Leo Stoller;
• Ebert;
• Law School Innovation;
• DragonFly
• KSR Shifts Obviousness Debate to "Mere Aggregations" and Presumptions of Non-Obviousness;
• Discussion of Response Briefs;
• Discussion of Petitioner and Supporting Amici’s Briefs on the Merits;
• Discussion of Government's Brief in Support of Certiorari;
• Discussion of Microsoft’s Amicus Brief;
• Discussion of the CAFC decision;
• Discussion of Law Professors Brief;
• Discussion of In re Kahn;
• Discussion of Petition for Certiorari;
• Prediction Certiorari;
• Professor Wagner and Strandburg debate obviousness in Penn’s new online law reivew:PENNumbra;
• Prof Miller: KSR Lift-off!
• Prof Miller: Discussion of Gov’t Brief;
• Patent Hawk: Becoming Less Obvious;
• Patent Hawk: Hindsight Problem;
• Buchanan: "[O]nce again, patent reform has left the Capitol and walked across First Street to the Supreme Court." [Link];
• Petherbridge & Wagner Empirical Article [link]
• Cotropia Article: [link].
• Shane Popp Article on Section 103 background [link]
• Mark Smith, a student at Santa Clara Law has these three posts in SCU’s great new Tech Law Forum:
  • http://www.techlawforum.net/blogs/a-precursor-to-obviousness/
  • http://www.techlawforum.net/blogs/per-se-or-not-per-se/
  • http://www.techlawforum.net/blogs/hey-teacher-leave-our-test-alone/
• The Patent at issue: [link] [link]

Cite as Dennis Crouch, “KSR Gobbledygook,” Patently-O, available at http://www.patentlyo.com.