On April 30, 2007, the U.S. Supreme Court issued its most recent patent decision: KSR International Co. v. Teleflex Inc., 127 S. Ct. 1727 (2007), in which it rejected what it deemed to be a "rigid" and "narrow" test for determining the validity of a patent. Following the decision, it was widely reported that the KSR opinion would render patents more prone to invalidity challenges on the basis of obviousness. However, based on the author's experience in a recent case in which patent validity was raised as the principal defense to our client's infringement claim, it is clear that the practical impact of KSR can be contained if appropriate strategies are employed at trial.
In KSR, a unanimous decision authored by Justice Kennedy, the Supreme Court held that an "expansive and flexible approach" must now be used in patent validity challenges based on obviousness, explaining that, "[r]igid preventive rules that deny fact-finders recourse to common sense… are neither necessary under our case law nor consistent with it."
Under United States Code, Title 35, Section 103, a patent is invalid if it would have been obvious to a person of "ordinary skill" in the technology to which the invention pertains at the time the invention was made. In order to prove a patent is obvious, the party challenging the patent must use written information that predated the invention ("prior art"), usually in the form of earlier patents or technical articles, to show that the patent claims were obvious. Unlike "anticipation" challenges under Section 102 (which require that each element of a patent claim be disclosed in a single piece of prior art), a party challenging the validity of a patent claim as "obvious" under Section 103 is allowed to combine different items of prior art-which may disclose different elements within the challenged patent claim-to prove obviousness.
For many years before the KSR decision, the federal courts had applied a test that no patent could be found "obvious" (and thus invalid) unless there was some prior "teaching, suggestion, or motivation" indicating how the prior art could be combined to make the invention obvious. The "teaching, suggestion, or motivation" test, described as the "TSM test" by the Supreme Court in KSR, effectively required that the prior art being relied on to challenge the validity of a patent claim set forth some explicit suggestion, or "motivation," to combine the different pieces of prior art.
According to the Supreme Court in KSR, this test was unnecessarily rigid and conflicted with the Court's earlier decision in Graham v. John Deere, Co. of Kansas City, 383 U.S. 1 (1966). In KSR, the Supreme Court held that strict application of the TSM test impermissibly prevented judges and juries from applying their common sense in deciding the obviousness issue. According to the Supreme Court, "any need or problem known in the field of endeavor at the time of invention and addressed by the patent" should be allowed to "provide a reason for combining" the prior art to show obviousness of the invention. As the Supreme Court in KSR explained, "[c]ommon sense teaches… that familiar items may have obvious uses beyond their primary purposes, and in many cases a person of ordinary skill will be able to fit the teachings of multiple patents together like pieces of a puzzle." According to the KSR Court:
When there is a design need or market pressure to solve a problem and there are a finite number of identified, predictable solutions, a person of ordinary skill has a good reason to pursue the known options within his or her technical grasp. If this leads to the anticipated success, it is likely not the product of innovation but of ordinary skill and common sense.
The Supreme Court also noted, however, that there is no "necessary inconsistency between the idea underlying the TSM test and the Graham analysis," so long as the court or jury does not restrict itself to relying on only the "precise teachings directed to the specific subject matter of the challenged [patent] claim." The Supreme Court found that it may still be "important to identify a reason" for combining prior art references to invalidate a patent:
Although common sense directs one to look with care at a patent application that claims as innovation the combination of two known devices according to their established functions, it can be important to identify a reason that would have promoted a person of ordinary skill in the relevant field to combine the elements in the way the claimed new invention does.
In Graham, which the KSR decision identified as the principal underpinning for its holding, the Supreme Court had set forth a list of "secondary considerations of non-obviousness" to assist in making patent validity determinations related to obviousness. These "secondary considerations of non-obviousness," also referred to as the "Graham factors" or "objective indicators of non-obviousness," include:
- Commercial success of products covered by the patent claims;
- A long-felt need for the invention;
- Failed attempts by others to make the invention;
- Copying of the invention by others;
- Unexpected results achieved by others;
- Praise of the invention;
- The taking of licenses under the patent by others;
- Expressions of surprise by experts at the making of the invention; and
- That the patentee proceeded contrary to the accepted wisdom of the prior art.1
By recognizing the continuing viability of the Graham factors in a patent validity analysis, the Supreme Court's decision in KSR does not have the punch it otherwise might have had. Specifically, while the KSR Court held that "design need or market pressure to solve a problem" can supply the impetus for combining two or more items of prior art to solve a problem, this same market need is closely akin to the "long felt need" that, under Graham, represents an objective indicator of non-obviousness. In other words, to the extent an invalidity expert claims "one with skill in the art" would have been motivated to combine two prior art references under Section 102 because of a "design need or market pressure to solve a problem," the expert must then explain why that "design need or market pressure to solve a problem" instantaneously appeared just before the claimed invention. If the expert cannot, the expert becomes exposed to the argument that "design need or market pressure to solve a problem" actually represents an "objective indicator of non-obviousness," i.e., a long felt need for the invention.
These issues played out in a recent post-KSR trial in which obviousness was raised by the defendant as the principal defense to the patent claims in suit. The trial court included in its obviousness jury instruction the following standard from the just-issued KSR decision:
In order to support a conclusion of obviousness, there must be a suggestion or motivation to combine the teachings of the prior art. This suggestion or motivation to combine the teachings of the prior art may be derived from the prior art itself, from the knowledge of one of ordinary skill in the art, or from the nature of the problem to be solved. In that regard, you should not look only at the problem the patentee was trying to solve. Any need or problem known in the field of endeavor at the time of the invention and addressed by the patent can provide a reason to combine the elements in the manner claimed.
Celerity v. Ultra Clean Technologies, No. 05-CV-04374 MMC (N.D. CA June 25, 2007). However, recognizing the continuing viability of the Graham factors as directed in the KSR decision, the trial judge also instructed that the jury consider the Graham objective indicators of non-obviousness, which included: (1) commercial success of products covered by the patent claims, (2) a long-felt need for the invention, and (3) failure by others.
During the trial, the KSR-related evidence played out as follows: During direct examination, the defendant's invalidity expert relied heavily on the KSR notion that "design need or market pressure to solve a problem" could supply the motivation to combine prior art references to render a patent claim obvious. With respect to each patent claim challenged on this basis, the invalidity expert testified that the motivation to combine elements from various prior art patents had been supplied by the general need within the market for the invention. However, during cross-examination of defendant's invalidity expert, the expert admitted that this "design need or market pressure to solve a problem" had been in existence the entire time the expert had worked in the relevant industry, and therefore demonstrated a "long-felt need for the invention." This, of course, represented an admission from defendant's invalidity expert of the second "objective indicator of non-obviousness," i.e., a long-felt need for the invention. Following additional proof to support the other Graham factors, the jury rejected each of the defendant's invalidity challenges, finding infringement and upholding the validity of each of the patent claims in suit. Id.
While the impact of the KSR decision on validity challenges may be mitigated by the continuing viability of the Graham factors, there can be no question that companies accused of patent infringement now have more flexibility in defending a lawsuit on grounds that a patent claim was obvious and therefore invalid. The new Supreme Court rule, in the hands of a skillful advocate, provides a potent new weapon to a defendant in a patent infringement action, making it more important than ever to have experienced patent trial counsel who can effectively marshal the technological and legal arguments to either prove, or counter, such a defense.
The KSR decision does not, however, mean that patent claims are necessarily doomed to invalidity findings on the basis of obviousness. Because of the presumption that patents are valid, obviousness challenges still require that the defendant prove obviousness by clear and convincing evidence, the highest burden of proof in the civil law. Classic arguments to protect a patent's validity, such as the fact that the prior art "teaches away from the claimed invention," as well as Graham factors of non-obviousness-such as commercial success, long-felt need, and failure by others-have become even more important to defending an attack on a patent's validity. Armed with appropriate trial strategies, KSR does not represent an insurmountable obstacle to validating a patent claim over a defense that the patented invention was obvious.
1. Not all of these factors were explicitly identified in the Graham decision. The objective indicators listed in Graham were: (1) commercial success; (2) long-felt but unsolved needs; and (3) failure of others. See Graham, 383 U.S. at 17. Other objective indicators have been identified by courts following Graham. See Environmental Designs, Ltd. v. Union Oil Co. of Cal., 713 F.2d 693, 697-98 (Fed. Cir. 1983) (considering skepticism or disbelief before the invention as an indicator of non-obviousness); Allen Archery, Inc. v. Browning Mfg. Co., 819 F.2d 1087, 1092 (Fed. Cir. 1987) (considering copying, praise, unexpected results, and industry acceptance as indicators of non-obviousness); Diversitech Corp. v. Century Steps, Inc., 850 F.2d 675, 679 (Fed. Cir. 1988) (considering copying as an indicator of non-obviousness); see also, Federal Circuit Bar Association Model Patent Jury Instruction 10.9.4 (listing all objective indicators).
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