[A2k] obviousness: KSR International v. Teleflex

[Gaëlle Krikorian]

United States: Oops I Did It Again! – Supreme Court Reverses Federal
Circuit, This Time On Obviousness

03 May 2007
Article by Paul Devinsky and Amanda E. Koenig

On April 30, 2007, a unanimous U.S. Supreme Court issued its holding
in KSR International v. Teleflex, reversing the U.S. Court of Appeals
for the Federal Circuit’s decision that the patent at issue was not
invalid for obviousness. In doing so, the Supreme Court reviewed the
Federal Circuit’s "teaching suggestion or motivation" (TSM) test for
obviousness. While describing the TSM test, originally articulated by
the Court of Customs and Patent Appeals (the Federal Circuit’s
predecessor) as a "[h]elpful insight[]," the Supreme Court sharply
criticized the Federal Circuit for its "narrow conception of the
obviousness inquiry reflected in its application of the TSM test."

Background

The patent at issue relates to an adjustable gas (throttle) pedal
assembly in combination with an electronic control. Instead of
mounting certain electronic sensors for engine control on the gas
pedal, the patent placed the sensors mounted on the vehicle body
adjacent to the pedal. The issue was whether the claimed invention
was obvious under 35 U.S.C. § 103.

The district court granted summary judgment in favor of KSR on the
basis that the claim at issue was invalid for obviousness. On appeal,
the Federal Circuit reversed, holding that the district court had
applied the TSM test too broadly by failing to make "finding[s] as to
the specific understanding or principle within the knowledge of a
skilled artisan that would have motivated one with no knowledge of
[the] invention . . . to attach an electronic control to the support
bracket of the [prior art] assembly." To support motivation, the
Federal Circuit said the prior art references must address "the
precise problem that the patentee was trying to solve."

In the alternative, the Federal Circuit reversed the grant of summary
judgment on the basis that there existed a genuine dispute over an
issue of material fact, the only evidence of which was expert
testimony in the form of an affidavit.
The Supreme Court’s Decision

Interestingly, the Supreme Court’s overarching theme was a criticism
of the Federal Court’s application of the TSM test in light of
previous jurisprudence, not a criticism of the test itself: "The
flaws in the analysis of the Court of Appeals relate for the most
part to the court’s narrow conception of the obviousness inquiry
reflected in its application of the TSM test." Specifically, the
Supreme Court concluded that the Federal Circuit’s analysis in this
case had improperly focused on the motivation and avowed purpose of
the patentee. Instead, it held, "[w]hat matters is the objective
reach of the claim."

In reviewing its own precedent, the Supreme Court reminded us that in
its view "[t]he combination of familiar elements according to known
methods is likely to be obvious when it does no more than yield
predictable results." Thus, evidence of unexpected results is likely
to become a more important bell-weather of non-obviousness when a
case of prima facie obviousness is present. Moreover, in a passage
likely to be oft quoted by those challenging patentability, the Court
observed that "[w]hen a work is available in one field of invention,
design incentives and other market forces can prompt variations of
it, either in the same field or a different one. If a person of
ordinary skill can implement a predictable variation, section 103
likely bars patentability." This may open the door to new and broader
"analogous art" arguments in an area that had been thought to be well
settled.

The Supreme Court also called into question the strength of the
presumption of validity in cases where prior art was not before the
U.S. Patent and Trademark Office (USPTO) , noting that "[w]e need not
reach the question whether the failure to disclose [a prior art
reference] during the prosecution ... voids the presumption of
validity given to issued patents, for [the] claim [in issue here] is
obvious despite the presumption. We nevertheless think it appropriate
to note that the rationale underlying the presumption—that the PTO,
in its expertise, has approved the claim—seems much diminished here."

The Supreme Court then went on to analyze the Federal Circuit’s
application of the TSM test under the fact pattern at issue in the
case, i.e., where the alleged infringer alleges obviousness by
arguing that "there existed at the time of invention a known problem
for which there was an obvious solution" and that that obvious
solution is "encompassed by the patent’s claims." The Supreme Court
identified four principle flaws in the Federal Circuit’s analysis:

     * First, it held that the "obvious solution" analysis should
focus not on the problem the patentee was trying to solve but on the
more general needs or problems facing the field of art. ("Under the
correct analysis, any need or problem known in the field of endeavor
at the time of invention and addressed by the patent can provide a
reason for combining the elements in the manner claimed.")

     * Second, in determining what prior art a person of ordinary
skill in the art who is attempting to solve a problem will seek out,
the analysis should not be limited to prior art directed only to that
very same problem. In other words, as the Supreme Court noted, "[a]
person of ordinary skill is also a person of ordinary creativity, not
an automaton."

     * Third, contrary to a long line of Federal Circuit cases,
obviousness may, in a context where the possible combinations and
permutations are limited, be established by "showing that the
combination of elements was ‘obvious to try.’"

     * Finally, the Supreme Court criticized the Federal Circuit for
exhibiting an almost obsessive concern to avoid falling prey to
hindsight, a concern that led it to improperly "deny factfinders
recourse to common sense."

In the final section of the decision, the Supreme Court also
addressed the Federal Circuit’s alternate ground for reversing the
district court’s ruling on summary judgment: "…the existence of a
dispute over an issue of material fact." The Federal Circuit had
based its finding on expert testimony proffered in an affidavit.
While noting the propriety of taking expert testimony into account
when considering summary judgment, the Supreme Court highlighted the
fact that obviousness is a legal determination based on specific
factors: "…the content of the prior art, the scope of the patent
claim, and the level of ordinary skill in the art." Where those
factors are not in dispute, summary judgment is appropriate.
"Conclusory" statements by experts to the contrary should not dictate
otherwise.

Conclusion

While the impact of the Supreme Court’s decision is bound to be
widespread, its anticipated severity is uncertain. In its decision,
the Court itself noted that two subsequent (2006) Federal Circuit
cases, DyStarTestilfarben GmbH & Co. Deutschland KG v. C. H. Patrick
Co. (IP Update, Vol. 9, No. 10) and Alza Corp. v. Mylan Labs., Inc.
(IP Update, Vol. 9, No. 9), have applied the TSM test much more
broadly and flexibly than in the KSR case, and perhaps in a manner
more consistent with Supreme Court precedent. However, the Supreme
Court noted that these cases were "not before [it] and do not correct
errors of law … in this [KSR] case."

We expect that in the future, patents will be subject to more
rigorous challenges under the obviousness statute. As broader and
more flexible application of the obviousness statute will make it
more difficult to predict the outcome of patentability challenges
with great certainty, some patentees may now hesitate to seek redress
for infringement if they perceive their patent may be vulnerable to
an obviousness attack, may assert only their narrowest claims
(recognizing that counterclaims or declaratory judgment actions may
nevertheless challenge the others) or may seek to shore up their
patent against perceived vulnerabilities through procedural avenues
available at the USPTO (i.e., re-examination and reissue).