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Exploring the Latest in Intellectual Property Law
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Faulty Jury Instruction Tampered With Tamper-Proof Trial

by | Apr 4, 2024 |

The US Court of Appeals for the Federal Circuit affirmed in part, vacated in part and remanded a district court decision after concluding that a jury instruction on the objective indicia of nonobviousness that failed to specify all indicia on which evidence had been received constituted prejudicial legal error. Inline Plastics Corp. v. Lacerta Group, LLC, Case Nos. 22-1954; -2295 (Fed. Cir. Mar. 27, 2024) (Taranto, Chen, Hughes, JJ.)

Inline Plastics owns a patent family pertaining to containers with specific tamper-proof features and methods of producing these containers using thermoformed plastic. The invention is intended to deter unauthorized tampering with products in the containers. These tamper-proof features serve to prevent theft and product loss and maintain consumer confidence in product integrity.

Inline sued Lacerta Group for patent infringement over its tamper-proof technology. The district court made several significant pretrial rulings, including a claim construction order, and granted Inline’s motion for partial summary judgment of infringement on some of the asserted claims. During trial, Inline voluntarily withdrew certain claims, and the jury returned a verdict declaring all remaining claims (even those on which summary judgment had been granted) invalid and not infringed. After trial, Inline sought partial final judgment, which was granted, but also motioned for judgment as a matter of law and a new trial on invalidity. The district court denied Inline’s motions. Both Inline and Lacerta appealed.

Inline argued that it was entitled to judgment as a matter of law of no invalidity and that an error in the jury instructions requires a new trial on invalidity. Lacerta cross-appealed, challenging the denial of attorneys’ fees and the “without prejudice” dismissal of certain patent claims that Inline voluntarily dropped from its asserted-claims list near the end of trial.

The Federal Circuit rejected Inline’s argument for judgment as a matter of law of no invalidity but agreed with Inline that the jury instruction on the objective indicia of nonobviousness constituted prejudicial legal error. The Court determined that the jury could have reasonably found obviousness and rejected Inline’s three arguments against it. First, Inline argued deficiencies in Lacerta’s prior art references and expert testimony, but the Court found these arguments unpersuasive. Second, Inline challenged Lacerta’s evidence of motivation to combine references, but the Court found enough support to prove a motivation to combine. Third, Inline argued that Lacerta’s challenge failed because there was no rebuttal or opinion on objective-indicia evidence. The Court dismissed this argument, explaining that the absence of such testimony did not necessarily discredit the patentee’s evidence on nonobviousness. According to the Court, Inline failed to explain why the jury could not reasonably assign little weight to its objective-indicia evidence, which led the Court to reject Inline’s categorical argument based on the absence of expert testimony from Lacerta’s side.

However, the Federal Circuit agreed with Inline’s argument for a new trial on invalidity. The Court explained that jury instructions must be legally correct and sufficiently comprehensive to address disputed evidence. The Federal Circuit concluded that the district court’s objective-indicia instruction [...]

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Is Evidence of All Claimed Elements in Prior Art Enough? Not Without Motivation to Combine

by | Apr 4, 2024 |

The US Court of Appeals for the Federal Circuit reversed a Patent Trial & Appeal Board obviousness decision, finding that disclosure in the prior art of all recited claim elements across multiple references, without more, does not establish obviousness unless there is evidence of a motivation to combine. Virtek Vision Int’l ULC v. Assembly Guidance Systems, Inc., Case No. 22-1998 (Fed. Cir. Mar. 27, 2024) (Moore, C.J.; Hughes, Stark, JJ.)

Virtek holds a patent that discloses “an improved method for aligning a laser projector with respect to a work surface.” Lasers are used to “project a template image onto a work surface to direct manufacturing processes.” The patent discloses a two-step process that improves efficiency over the prior art.

Aligned Vision petitioned for inter partes review (IPR), challenging all of the patent’s claims. Aligned Vision asserted four combinations of prior art references over which it contended the claims were obvious. In its Final Written Decision, the Board found that some of the claims were unpatentable as obvious, but others were not.

The Board determined that certain claims, which depended from the independent claim, would have been obvious over two combinations of references: Keitler and Briggs, and Briggs and Bridges. In pertinent part, the independent claim recites “identifying a pattern of the reflective targets on the work surface in a three dimensional coordinate system.” Save for the 3D claim element, all the other claim elements were disclosed in Bridges and Keitler. The Board found that a skilled artisan would have been motivated to use the 3D coordinate system disclosed in Briggs instead of the angular direction systems in Keitler or Bridges. The Board reasoned that this combination would have been obvious to try because Briggs disclosed both 3D coordinates and angular directions.

With respect to the direct appeal, the Federal Circuit found that the Board erred as a matter of law regarding motivation to combine. “It does not suffice to meet the motivation to combine requirement to recognize that two alternative arrangements such as an angular direction system using a single camera and a 3D coordinate system using two cameras were both known in the art.” Rather, the patent challenger must show that a skilled artisan would swap the element in one reference for an element in another reference. “The mere fact that these possible arrangements existed in the prior art does not provide a reason that a skilled artisan would have substituted the one-camera angular direction system in Keitler and Bridges with the two-camera 3D coordinate system disclosed in Briggs.”

Here, the patent challenger presented no argument in the IPR petition regarding why a skilled artisan would make this substitution, other than that the two different coordinate systems were “known to be used.” Specifically, Briggs made no mention of any benefits the 3D system might provide over the angular system. Aligned Vision’s expert testified multiple times that he could not provide a reason to combine the references, and Aligned Vision presented no evidence that “there are a finite number of [...]

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Optimizing Obviousness: Routine Optimization Can Fill in Prior Art Gaps

by | Mar 14, 2024 | ,

In an appeal from a Patent Trial & Appeal Board finding of invalidity, the US Court of Appeals for the Federal Circuit held that the result-effective variable doctrine can apply even when there is no overlap between a claimed range and a prior art range. The Court also held that before denying a motion to amend, the Board must address every element of proposed claims, and that a party cannot challenge the US Patent & Trademark Office (PTO) Director Review procedure if it cannot show prejudice. Pfizer Inc. v. Sanofi Pasteur, Inc., Case No. 19-1871 (Fed. Cir. Mar. 5, 2024), (Lourie, Bryson, Stark, JJ.)

Sanofi filed five inter partes review (IPR) petitions targeting a patent owned by Pfizer and directed to immunogenic glycoconjugates of Streptococcus antigens (i.e., combinations of sugar molecules found on the surface of Streptococcus bacteria capable of provoking an immune response). The challenged independent claim recited conjugates having a sugar from the 22F Streptococcus serotype and a molecular weight falling within a claimed range. Dependent claims further limited the independent claim by requiring combinations of specific sugars.

Sanofi challenged the claims based on a combination of two references: GSK-711 and Merck-086. GSK-711 described vaccines using sugars from 22F, and Merck-086 described immunogenic compositions using Streptococcus sugar conjugates. While neither reference disclosed the molecular weight of a 22F conjugate, the Board found that the molecular weight of a conjugate was a “result-effective variable” – i.e., a variable that affected the efficacy of the result – and thus it would have been obvious for a person of ordinary skill in the art (POSITA) to optimize the molecular weight of a 22F-based conjugate to achieve the claimed molecular weight range. The Board also found that the dependent claims would have been obvious, as GSK-711 disclosed the additionally claimed sugars. Pfizer filed a motion to amend to add new claims, but the Board denied the motion. Pfizer also requested Director Review of the Board’s decision, but the Director denied the request.

Pfizer appealed to the Federal Circuit alleging that the Board improperly applied the result-effective variable doctrine, that the Board improperly denied Pfizer’s request to amend the claims, and that the Director’s denial of review violated the Administrative Procedure Act (APA). The Federal Circuit affirmed the Board’s finding of invalidity, affirmed in part and remanded in part the issue of the proposed claim amendment, and finally held that any violation of the APA was harmless.

The Federal Circuit started with an analysis of the result-effective variable doctrine. Pfizer argued that the result-effective variable doctrine could not apply when there was no disclosure of an effective range in the prior art. Therefore, because neither GSK-711 nor Merck-086 disclosed an effective molecular weight range for a 22F conjugate, and because the relationship between molecular weight and efficacy was unpredictable, the independent claim was not obvious. The Court disagreed.

The Federal Circuit explained that, when there is a gap between the prior art and the claims, the relevant [...]

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Consider Invention When Assessing Support for Claimed Range

by | Feb 29, 2024 |

The US Court of Appeals for the Federal Circuit affirmed in part and vacated in part a Patent Trial & Appeal Board finding that the claims at issue were either invalid under 35 U.S.C. §112 as unsupported by written description or obvious under 35 U.S.C. §103. RAI Strategic Holdings, Inc. v. Philip Morris Products S.A., Case No. 22-1862 (Fed. Cir. Feb. 9, 2024) (Chen, Stoll, Cunningham, JJ.)

RAI owns a patent with claims directed to “electrically powered smoking devices that provide an inhalable vapor by heating tobacco or other substances without significant combustion.” Philip Morris challenged the patent in a post-grant review (PGR).

The Board issued a final written decision concluding that two dependent claims, which recited limitations requiring a heating member with “a length of about 75% to about 85% of a length of the disposable aerosol forming substance,” lacked § 112 written description support. The specification disclosed ranges of 75% – 125%, 80% – 120%, 85% – 115% and 90% – 110%. The Board explained that written description support was lacking because “the claimed range is different from and substantially narrower than the specific ranges disclosed in the specification.”

The Board found that the remaining claims were unpatentable as obvious based on a combination of prior art references where the heater found in one reference, Robinson, was replaced with the heater from another, Greim. Robinson explained that its heating element could be altered and acknowledged design choices, thus inviting skilled artisans to select an alternate appropriate heating element. Greim disclosed certain advantages to its heater. Thus, the Board found that a skilled artisan would have been motivated to replace Robinson’s heater with that of Greim, rendering the claims obvious. RAI appealed.

Citing its expert, RAI argued that the ranges disclosed in the specification all centered around 100%, so that a person of ordinary skill in the art (POSITA) would not “conclude that the inventors possessed a range that went no higher than 85%[.]” The Federal Circuit began by summarizing a line of numerical range cases, including:

  • In re Wertheim (CCPA 1976), which found that a described range of 25% – 60%, with examples of 36% and 50%, supported a claim directed to a range of 35% – 60%.
  • In re Blaser (CCPA 1977), which found that a described range of 60° – 200° C supported a claim reciting a range of 80° – 200° C.
  • Kolmes v. World Fibers Corp. (Fed. Cir. 1997), which found that a described range of 4 – 12 turns per inch, and preference for 8 turns per inch, supported claims directed to 8 – 12 turns per inch.
  • In re Baird (CCPA 1965), which found that a relatively unexplained disclosure of 32 – 176° F did not support claims directed to a range from 40° to “at least as low as” 60° F.
  • Indivior UK v. Dr. Reddy’s Laboratories (Fed. Cir. 2021), which found that:
    • Disclosure of ranges of at least 25%, at least 50% and “any” value [...]

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R&D Expenditures Need Only Relate to Subset of Domestic Industry Product

by | Feb 1, 2024 |

Addressing a decision by the US International Trade Commission finding a violation of Section 337 based on importation of certain TV products, the US Court of Appeals for the Federal Circuit agreed that the patent holder had established a domestic industry based on research and development (R&D) relating to only a subset of the domestic industry products. Roku, Inc. v. ITC, Case No. 22-1386 (Fed. Cir. Jan. 19, 2024) (Dyk, Hughes, Stoll, JJ.)

In 2020, Universal Electronics filed a complaint at the Commission seeking a Section 337 investigation of certain streaming devices, TVs, set top boxes and remote controls sold by Roku and others that allegedly infringed six of Universal Electronics’ patents. During the investigation, the administrative law judge (ALJ) granted Roku’s summary determination motion that Universal Electronics lacked ownership of one of the patents, but the Commission promptly reversed that decision. Prior to the hearing, Universal Electronics terminated the investigation as to the three other patents and all respondents other than Roku. The ALJ subsequently issued an initial determination finding infringement and domestic industry for all three patents but held that two of the patents were invalid. The Commission agreed and issued a limited exclusion order barring Roku’s importation. Roku appealed.

Roku raised three challenges to the Commission’s decision on appeal. Roku renewed its ownership argument, disputed the domestic industry finding, and contested the holding of nonobviousness. The Federal Circuit affirmed on all issues.

On ownership, the Federal Circuit faced the question of whether an inventor had executed an automatic assignment or merely a promise to assign. The Court noted that Roku only addressed a 2004 agreement cited by the ALJ and disregarded a later 2012 agreement relied on by the Commission where the inventor agreed to “hereby sell and assign” the patent.

The Federal Circuit rebuffed Roku’s argument that the domestic industry prong was not satisfied on the basis that Universal Electronics failed to allocate expenses to specific domestic industry products. Instead, the Court noted that Section 337 requires investment in the exploitation of the intellectual property and explained that the expenditures can relate to only a subset of a product if the patent only involves that subset.

Finally, regarding obviousness, the Federal Circuit noted that Roku’s arguments regarding secondary considerations ignored the Commission’s finding that the prior art combination failed to satisfy the key claim limitation. As to secondary considerations, the Court dismissed Roku’s lack of nexus argument by finding that it did not matter that the news articles showing a long-felt but unmet need also discussed features other than what was claimed by the patent.



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Keep Calm and Party On: New Issue Prohibition Doesn’t Apply to Motions to Amend

by | Jan 25, 2024 |

The US Court of Appeals for the Federal Circuit affirmed a Patent Trial & Appeal Board obviousness determination, explaining that inter partes review (IPR) statutory provisions that prohibit an otherwise time-barred party from introducing new issues into the proceeding do not apply to motions to amend. CyWee Group Ltd. v. ZTE (USA), Inc. et al., Case No. 21-1855 (Fed. Cir. Jan. 18, 2024) (Prost, Hughes, Stoll JJ.)

CyWee owns a patent directed to a “three-dimensional (3D) pointing device capable of accurately outputting a deviation including yaw, pitch and roll angles in a 3D reference frame and preferably in an absolute manner.” ZTE filed a petition for IPR of the patent asserting that certain claims were unpatentable. The Board instituted the IPR. LG later filed an IPR petition challenging the patent and moved to join ZTE’s ongoing IPR, stating that it would “act as a passive ‘understudy’ and [would] not assume an active role unless [ZTE] ceases to participate in the instituted IPR.”

While LG’s motion was pending, CyWee moved to amend its patent claims, contingent on cancellation of the original claims. ZTE opposed the motion to amend. The Board gave preliminary guidance that the proposed claims lacked written description support and introduced new matter, and also that one of the proposed claims was invalid over the asserted prior art.

The Board granted LG’s motion to join ZTE’s IPR proceeding but placed restrictions on LG’s participation that required LG to consolidate filings with ZTE, rely on ZTE to take and defend depositions, refrain from requesting or reserving additional deposition or oral hearing time, and agree to other procedural concessions to minimize delay to the IPR proceeding.

After LG’s joinder, CyWee filed a revised motion to amend. ZTE indicated that it did not oppose the motion. LG, arguing that ZTE was no longer actively participating in the IPR, moved for leave to oppose CyWee’s motion to amend. Ultimately, the Board permitted LG to present argument and evidence independent from ZTE. LG filed an opposition arguing that CyWee’s proposed revised claims were obvious over Withanawasam, Bachmann and Bachmann2. Notably, ZTE had not cited Withanawasam in its opposition to CyWee’s initial motion to amend.

After the Board issued its final decision finding that the proposed revised claims were obvious over Withanawasam, Bachmann and Bachmann2, CyWee appealed.

CyWee argued that the Board erred by allowing LG to oppose CyWee’s motion to amend in a manner that violated the terms of LG’s joinder and by allowing LG to raise Withanawasam in opposition to the motion to amend. The Federal Circuit rejected both arguments. The Court explained that the Board concluded that although ZTE still participated in the IPR, the proceeding “no longer appear[ed] to be meaningfully adversarial” as to the revised motion to amend. The Court found no error in the Board’s conclusion that ZTE was no longer an active participant in the IPR proceeding, and thus there was no violation of the joinder terms.

The Federal Circuit also concluded that the Board did not err [...]

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Store This Element: Lexicography Controls Claim Term Definition Over Plain and Ordinary Meaning

by | Dec 21, 2023 |

The US Court of Appeals for the Federal Circuit affirmed a Patent Trial & Appeal Board obviousness finding, determining that the Board properly applied the patentee’s lexicography in construing a disputed claim term and properly treated arguments raised by the parties in the reply and sur-reply briefings. ParkerVision, Inc. v. Vidal, Case No. 22-1548 (Fed. Cir. Dec. 15, 2023) (Prost, Wallach, Chen, JJ.)

Intel filed a petition for inter partes review of a patent owned by ParkerVision. The challenged patent is directed to wireless local area networks (WLANs) that use frequency translation technology and incorporate another patent that describes down-conversion utilizing down-converter modules. The challenged claim is directed to apparatuses for down-converting electromagnetic (EM) signals. Among other things, the claim recites “wherein said first and said second frequency down-conversion modules each comprise a switch and a storage element.” The Board found the challenged claim unpatentable and in doing so, construed the term “storage element” to mean “an element of a system that stores non-negligible energy from an input signal.” The Board based its construction on the description of “storage modules” in a patent incorporated by reference into the challenged patent. ParkerVision appealed.

The Federal Circuit affirmed the Board’s construction, finding that ParkerVision had acted as its own lexicographer when it defined the term “storage element” in the incorporated-by-reference patent. The Court relied on a “critical” paragraph from the incorporated-by-reference patent that states: “[s]torage modules and storage capacitances, on the other hand, refer to systems that store a non-negligible amount of energy from an input EM signal.” The Court reasoned that the term “refer to,” together with the “as used herein” language from a preceding sentence, conveyed an intent for the sentence to be definitional and applicable to the whole patent rather than to a specific embodiment. To that end, the Court reiterated that a patentee may act as its own lexicographer by crafting a definition for a claim term rather than relying on the plain and ordinary meaning of that term, and that when a patentee does so, the definition may act as a disavowal of the full scope of the plain and ordinary meaning of the term.

ParkerVision also argued that the Board impermissibly relied on arguments allegedly raised for the first time in Intel’s reply brief, and that it erred in excluding certain arguments made by ParkerVision on sur-reply. The Federal Circuit rejected both arguments. The Court reasoned that because ParkerVision proposed a new claim construction in its patent owner response, Intel was permitted to argue and present evidence of obviousness under that new construction as long as such evidence relied on the same embodiments for each invalidity ground as were relied on in the petition.

The Federal Circuit also noted that ParkerVision’s arguments on sur-reply exceeded the scope of its patent owner response. While ParkerVision’s patent owner response proposed that the “storage element” be an element of the energy transfer system and store non-negligible amounts of energy from an input EM signal, ParkerVision only argued that the [...]

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No Money, Mo’ Problems: Speculative Damages Award Cannot Stand

by | Oct 26, 2023 |

The US Court of Appeals for the Federal Circuit upheld a district court’s claim construction and jury instructions but reversed a premature judgment as a matter of law (JMOL) on obviousness and an imprecise damages award. Cyntec Company, Ltd. v. Chilisin Electronics. Corp., Case No. 22-1873 (Fed. Cir. Oct. 16, 2023) (Moore, Stoll, Cunningham, JJ)

Cyntec sued Chilisin for willful infringement of two patents related to molded chokes, which are component parts in batteries and power supplies. Four events at trial led to this appeal. First, the district court construed the disputed “by means of” term by its plain meaning but also instructed the jury that when a result occurs “by means of” a factor, that factor “has an impact on”—but may not be the “only potential cause” of—the result. Second, Chilisin presented invalidity evidence, arguing that the asserted claims were obvious by one prior art reference in light of another.

Before Chilisin could cross-examine Cyntec’s rebuttal expert, the district court granted Cyntec’s JMOL, finding the patents not obvious. In the third event that led to the appeal, Cyntec presented a market-share lost profits theory of damages based on expert testimony. Chilisin unsuccessfully moved to exclude the testimony as being speculative and unreliable. The jury awarded more than $1.8 million in damages and the district court subsequently granted enhanced damages totaling more than $5.5 million. As for the fourth event, Chilisin unsuccessfully moved for JMOL and a new trial on multiple issues. Chilisin then appealed.

The Federal Circuit reviewed three issues on appeal:

  1. The nonobviousness JMOL
  2. The infringement findings
  3. The damages award.

Starting with nonobviousness, the Federal Circuit reversed the JMOL and remanded. While obviousness is ultimately a legal question, it relies on “numerous underlying factual findings,” including the scope/content/differences of prior art, the skill level of a person of ordinary skill in the art and objective indicia of nonobviousness such as commercial success. The Court found Chilisin had presented enough evidence to allow a jury to find the asserted claims obvious in light of the two prior art references presented. The Federal Circuit also analyzed the district court’s reasoning regarding the prior art and found that its “conclusions are either insufficient to support JMOL or unsupported by the evidence.” Thus, it was improper to withhold a partial fact issue from the jury.

Next, the Federal Circuit analyzed the infringement issue, dividing the analysis into the district court’s claim construction and jury instructions, and the jury’s infringement finding. Chilisin argued that the disputed term “by means of” should signal but-for causation, meaning the factor must cause the result. The Court agreed that this was one possible reading, but because the claim language did not read “by exclusive/primary means” or something similar, the disputed term could also encompass “mere contribution.” The Federal Circuit cited to the specification in support of its claim interpretation and ultimately upheld the district court’s claim construction and the consistent jury instructions. The Court rejected Chilisin’s argument that there was insufficient evidence of infringement, concluding [...]

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Decoding Algorithms: Structural Sufficiency for Means-Plus-Function Claim Judged From Skilled Artisan’s Perspective

by | Oct 19, 2023 |

The US Court of Appeals for the Federal Circuit reiterated that in the context of construing computer-implemented means-plus-function limitations, if the specification discloses some arguable algorithm, even if a party contends that the algorithm is inadequate, the sufficiency of the purportedly-adequate structure disclosed in the specification must be evaluated in light of the knowledge possessed by a skilled artisan. Sisvel International S. A. v. Sierra Wireless, Inc., Case No. 22-1493 (Fed. Cir. Oct. 6, 2023) (Moore, Clevenger, Chen, JJ.)

Sisvel owns a patent directed to methods of channel coding when transmitting data in radio systems. The patent uses techniques called “link adaptation” and “incremental redundancy,” which are alleged to provide improvement over prior channel coding techniques. Sierra filed a petition for inter partes review (IPR) challenging certain claims as obvious over the Chen reference by itself and challenging those and other claims as obvious over the combination of the Chen and Eriksson references or the combination of the Chen and GSM references. The Patent Trial & Appeal Board found that some challenged claims were obvious based on Chen alone and that other claims were patentable over the proposed combination of references. Both parties appealed.

Sisvel appealed the Board’s unpatentability finding, arguing that Chen failed to disclose a second puncturing pattern. Sisvel also argued that the Board did not provide a sufficiently detailed explanation to support its finding that Chen disclosed the claimed “combining” limitation and ignored Sisvel’s rebuttal arguments. The Federal Circuit disagreed with Sisvel on both counts and affirmed the Board’s determination. Regarding the second puncturing pattern, the Court found that the independent claim required a “first puncturing pattern” and a “second puncturing pattern,” and that Chen expressly described that its coded transmissions are “generated by using punctured codes” and that “[p]uncturing reduces the number of code symbols to be retransmitted.” Therefore, the Court found that substantial evidence supported the Board’s finding that Chen taught a second puncturing pattern. Regarding the “combining” limitation, the Court affirmed the Board’s decision and concluded that Chen’s disclosure of “accumulating the code symbols from the transmitted and retransmitted coded data blocks,” also referred to in Chen as “interleaving,” taught the “combining” limitation. Overall, the Court determined that the Board’s analysis was sufficiently detailed, adequately addressed Sisvel’s related arguments and was supported by substantial evidence.

Sierra appealed the patentability finding, arguing that the Board’s finding that a skilled artisan would not have been motivated to combine Chen and the GSM references was not supported by substantial evidence. Sierra also argued that the Board erroneously found insufficient corresponding structure in the specification for the term “means for detecting.” The Federal Circuit concluded that substantial evidence supported the Board’s finding of a lack of motivation to combine Chen and the GSM references, but that the Board erred in analyzing the “means for detecting” limitation. Regarding motivation to combine, the Court explained that although an IPR petitioner has a low burden of explaining why a skilled artisan would have been motivated to combine various references to form [...]

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

by | Oct 19, 2023 |

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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