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A Matter of Style: No Need to Select “Primary” Reference in Obviousness Challenge

The US Court of Appeals for the Federal Circuit affirmed an obviousness decision by the Patent Trial & Appeal Board, explaining that nothing requires a petitioner to identify a prior art reference as a “primary reference” in an obviousness challenge. Schwendimann v. Neenah, Inc., Case Nos. 22-1333; -1334; -1427; -1432 (Fed. Cir. Oct. 6, 2023) (Prost, Clevenger, Cunningham, JJ.)

Jodi Schwendimann filed lawsuits accusing Neenah of infringing several patents related to transfer sheets and methods for transferring images onto dark fabrics. Neenah filed several petitions for inter partes review (IPR) challenging various claims based on obviousness. The Board instituted the IPR challenges.

Schwendimann’s patents addressed a method for ensuring that dark images could be seen when transferred onto dark fabrics. Multilayer image transfer sheets were known in the prior art, teaching a two-step process to first apply a light background onto dark fabric and then apply the dark image on top. Schwendimann’s claims described a single-step solution, incorporating a white background, possibly of titanium dioxide, into the image transfer sheet so that a white background and dark image could be applied simultaneously onto a dark fabric.

All of the IPR petitions cited Kronzer as a prior art reference. Kronzer described multilayered image transfer sheets with varying configurations, although it lacked white pigment in a layer to transfer an image onto dark fabric. Another prior art reference, Oez, taught the use of a white pigment, such as titanium dioxide, in multilayered image transfer sheets. Schwendimann did not dispute that Kronzer and Oez taught or suggested all limitations recited in the challenged claims. Instead, she argued that there was no motivation for a skilled artisan to combine the references or to expect that such combination would yield a reasonable expectation of success. The Board considered and addressed each argument, relying on Neenah and Schwendimann’s experts’ testimony and the complementary and compatible nature of the references. The Board found the challenged claims obvious over Kronzer in view of Oez. Schwendimann appealed.

Schwendimann argued that substantial evidence did not support the Board’s findings that a skilled artisan would have been motivated to combine Kronzer and Oez and would have had a reasonable expectation of success in making the proposed combination. The Federal Circuit explained that substantial evidence means “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion” and considered these two arguments together.

The Federal Circuit found that Schwendimann failed to show that the Board’s findings were not supported by “substantial evidence.” Like the Board, the Federal Circuit used both expert witnesses’ testimonies to explain that the references shared a common goal of improving image transfer characteristics. The Court found that Schwendimann’s arguments that Oez taught away from the proposed combination failed because Oez’s disclosure did not discourage a skilled artisan from using white pigment identified in the challenged patents or lead the skilled artisan in a direction divergent from the path taken in the challenged patents. Her argument that adding titanium dioxide into Kronzer’s transfer sheets could [...]

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No Smoking Gun Here: Soliciting Input Sufficient to Satisfy Commission’s Statutory Obligation

Addressing a decision by the US International Trade Commission finding a violation of Section 337, the US Court of Appeals for the Federal Circuit agreed with the Commission on a slew of issues, including its determination that soliciting comments from a sister agency regarding the products at issue was sufficient consultation to satisfy the Commission’s statutory obligation to consult. Philip Morris Products S.A. v. Int’l Trade Comm’n, Case No. 22-1227 (Fed. Cir. Mar. 31, 2023) (Prost, Reyna, Stoll, JJ.)

R.J. Reynolds Tobacco Company filed a complaint at the Commission asserting a Section 337 violation by Philip Morris based on alleged infringement of three patents directed to tobacco heating products. During the course of the investigation, the administrative law judge (ALJ) granted summary determination in favor of R.J. Reynolds on the economic prong of the domestic industry requirement as to two of the asserted patents. The ALJ issued his initial determination finding that Philip Morris had violated Section 337 with respect to two of the asserted patents. On review, the Commission affirmed the ALJ’s decision with minor modifications and issued a limited exclusion order and a cease-and-desist order. Philip Morris appealed.

Philip Morris raised numerous issues on appeal. It claimed, for the first time, that the Commission erred in failing to consult with the US Food & Drug Administration (FDA), the US Department of Health & Human Services (HHS) agency exclusively tasked with regulating the tobacco products at issue. The Federal Circuit agreed with the Commission that Philip Morris forfeited this issue because, notwithstanding several rounds of briefing on the public interest factor, it never raised the issue before the ALJ nor the Commission until a motion filed after entry of the remedial orders. The Court also rejected Philips Morris’ consultation argument on the merits, finding that the Commission’s request for comments sent to the FDA was sufficient to meet the statutorily required “consult with[] and seek advice and information from” HHS, even though the FDA failed to respond.

Philip Morris next argued that the Commission abused its discretion by not concluding that the public interest in reduced-risk tobacco products at issue should have barred relief. But the Federal Circuit held that the Commission’s public interest finding had a sufficient basis in the record in the form of expert testimony, scientific articles and FDA documents regarding the products at issue to support its findings regarding the availability of alternative non-tobacco therapies and that the tobacco products were still potentially harmful.

Philip Morris also argued that the Commission erred by finding a domestic industry based on R.J. Reynolds’s competing products that had not yet received FDA approval. The Federal Circuit rejected this argument, explaining that those competing products were being sold at the time of the complaint and that the recently approved law imposing FDA regulation on those products was still in its grace period.

Finally, the Federal Circuit rejected Philip Morris’s various patent-related arguments, finding that the Commission’s determinations were based on substantial evidence.

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