In Volvo Penta of the Americas, LLC v. Brunswick Corp., Case No. 22-1765 (Fed. Cir. Aug. 24, 2023) (Moore, Lourie, Cunningham, JJ.), the Federal Circuit reversed the Board's obviousness rejection, finding that there was insufficient evidence to support the Board's conclusion that Brunswick's evidence of obviousness outweighed the objective evidence of nonobviousness.
The U.S. Patent 9,630,692 ("the '692 patent), assigned to Volvo Penta, focuses on a tractor-type stern drive for a boat. A stern drive is an engine located within the boat's hull and connected to a drive unit outside the hull, typically at the stern. Other drive arrangements include inboard and outboard drives. In inboard drives, the engine and transmission are within the hull with a propeller shaft extending through the bottom. In outboard drives, the engine and propeller drive are a separate unit attached outside the hull. A tractor-type drive uses forward-facing propellers to propel the boat through the water.
Volvo Penta introduced its commercial Forward Drive, based on the '692 patent, in 2015. It quickly gained popularity due to its forward-facing propellers, which increased distance between the propeller and swimmers or surfers, compared to traditional stern drive boats. In August 2020, Brunswick Corp. launched its own drive, the Bravo Four S, which is covered by the '692 patent. Brunswick did not dispute this fact, but instead requested an inter partes petition of the patent's claims on the same day. Brunswick argued that the claims were obvious based on the combination of Kiekhaefer and Brandt references. The Board agreed with Brunswick. Volvo Penta appealed.
In its appeal, Volvo Penta did not claim that the combination of Kiekhaefer and Brandt disclosed all the elements of the patent's claims. Instead, Volvo Penta made three main arguments: (1) that the Board's finding of motivation to combine lacked sufficient evidence, (2) that the Board made an error in its determination of nexus, and (3) that the Board erred in considering Volvo Penta's evidence of nonobviousness.
I. Motivation to Combine
The ultimate conclusion of obviousness is a legal determination based on factual findings. This includes considering whether a person of the ordinary skill in the art would have been motivated to combine different references in order to achieve the claimed invention. The Court reviews the Board's determination of obviousness de novo, but reviews its factual findings for substantial evidence. Substantial evidence means that a reasonable fact finder could have reached the same conclusion when considering the entire record.
Volvo Penta argued that the Board ignored several points in its favor, including that Brunswick never attempted the proposed modification despite knowing about Kiekhaefer reference for years, that the modification would require a complex redesign, and that Brunswick itself failed to create a functional drive. However, the Court disagreed with all of these arguments.
Kiekhaefer stated that a "tractor-type propeller" is more efficient and capable of higher speeds. The Board found that this statement would have motivated a skilled person in the field to modify Brandt's stern from pushing-type stern drive to be a pulling-type stern drive. Volvo Penta argued that there are other ways to achieve greater speeds and efficiency, but the Court noted that this doesn't negate the motivation. Specifically, regardless whether or not there are other ways to achieve greater speeds and efficiency, the Court noted that it does not mean improved speed and efficiency cannot provide a motivation for the method of using a tractor-type drive. That is, there is no requirement that there be only a single motivation for combining references.
Volvo Penta also argued that the Board made an error by relying on the testimony of Volvo Penta's employee, Mr. Sweet, to determine the applicability of Kiekhaefer's teachings. The Court agreed that reliance was misplaced since Mr. Sweet was not considered a skilled person in the field. However, the Board's finding of motivation to combine was still supported by substantial evidence because the Board also relied on other evidence, such as the testimony of Brunswick's expert witness, to demonstrate that Kiekhaefer's teachings had broader applications. Overall, the Court held that the Board's finding of motivation to combine is supported by substantial evidence.
Objective evidence of secondary considerations is relevant when there is a clear connection between the claimed invention and the objective evidence. This can be established through (1) a presumption of nexus or (2) by showing that the evidence directly resulted from the unique characteristics of the claimed invention.
To qualify for a presumption of nexus, the patent owner must demonstrate that the objective evidence is tied to a specific product that embodies the claimed features and is coextensive with them. In this case, both parties agreed that the Forward Drive and the Bravo Four S embody the claimed invention. However, the requirement of coextensiveness is a separate requirement, which was not adequately addressed by Volvo Penta's argument. Therefore, the Court held that Volvo Penta is not entitled to the presumption of nexus.
Even without a presumption of nexus, the patent owner still has the opportunity to prove nexus by showing that the evidence of secondary considerations is a direct result of the unique characteristics of the claimed invention. See, Fox Factory, Inc. v. SRAM, LLC, 944 F.3d 1366, 1373–74 (Fed. Cir. 2019). Volvo Penta argued that the success of the Forward Drive is directly tied to the claimed features, citing internal Brunswick documents in support. However, the Board criticized Volvo Penta for not specifically identifying the unique characteristics of the claimed combination that were tied to the objective evidence and therefore held there is no nexus between the objective evidence of secondary considerations and the claims.
The Federal Circuit disagreed with the Board's finding, stating that it lacked substantial evidence. Volvo Penta clearly argued that the steerable tractor-type drive, as described in the claims, drove the success of the Forward Drive. The internal Brunswick documents also highlight the need for a comparable forward-facing sterndrive with similar capabilities to the Volvo Penta Forward Drive. These documents further outline the unique characteristics that make a forward-facing drive valuable in the wake-surfing industry. Volvo Penta clarified in its Sur-Reply that the inventive combination of propeller arrangement and steering axis location provided specific benefits that were highly regarded in the industry and not achieved by drives in the prior art.
Additionally, the Board found that Brunswick's development of the Bravo Four S was akin to copying, as revealed by its own internal documents. This demonstrates a clear nexus between the unique features of the claimed invention, a tractor-type stern drive, and the evidence of secondary consideration.
III. Objective Indicia
Objective evidence of nonobviousness factors such as (1) commercial success, (2) copying, (3) industry praise, (4) skepticism, (5) long-felt but unsolved need, and (6) failure of others. See, e.g., Transocean Offshore Deepwater Drilling, Inc. v. Maersk Drilling U.S., Inc., 699 F.3d 1340, 1349–56 (Fed. Cir. 2012). The weight given to these factors is determined through factual evaluations, which are reviewed for substantial evidence.
In a recent case, Volvo Penta argued that the Board failed to properly consider and weigh its evidence of secondary considerations. The Court agreed, noting that the Board's assignment of vague weights to the factors and failure to explain its overall summation were problematic. For example, despite clear evidence of copying, the Board only gave this factor "some weight," without sufficient explanation. However, copying can be a strong indicator of nonobviousness. Indeed, objective considerations such as failure by others to solve the problem and copying may often be the most probative and cogent evidence of non-obviousness." See, Advanced Display Sys. v. Kent State Univ., 212 F.3d 1272, 1285 (Fed. Cir. 2000) (cleaned up). Therefore, the Board's assignment of only "some weight" to copying was not supported by substantial evidence.
Similarly, the Board did not find any evidence to detract from the finding of commercial success, yet only afforded this evidence "some weight." This was another error that lacked substantial evidence support.
Finally, the Court addressed the Board's ultimate conclusion that the objective evidence of nonobviousness outweighed by Brunswick's strong evidence of obviousness. The Board failed to provide any explanation for this conclusion. Even if the weights assigned to each individual factor were supported by substantial evidence, it is reasonable to expect that the sum of these weights would be greater. The Court held that the Board's lack of discussion on the summation of the factors is therefore insufficient to sustain its determination.
As a result, the Court reversed and remanded the case.
A Practice Tip: This case serves as an important reminder for practitioners to gather and highlight evidence of secondary considerations when facing a close obviousness rejection. These considerations include copying, long felt need, and failure by others to solve the problem. The Court, here, emphasized that copying alone can be a strong indicator of nonobviousness.
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