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Arguing Obviousness After KSR: Are We Coming Full Circle? (Fed. Cir. 2010)

To receive a patent for an invention under U.S. patent law, the invention must be both novel and nonobvious over the prior art.  Novelty under 35 U.S.C. § 102 can be established when not all of the elements and features of an invention are expressly or inherently provided in a single prior art reference.  However, the obviousness of an invention has a broader reach, which may be established in view of multiple prior art references.  35 U.S.C. § 103(a) defines obviousness as follows:

A patent may not be obtained though the invention is not identically disclosed or described as set forth in section 102 of [Title 35], if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains. Patentability shall not be negatived by the manner in which the invention was made.

Thus, the obviousness inquiry first determines the differences between the invention and the prior art and then asks whether those differences would have been obvious to a person having ordinary skill in the art.  Such person of ordinary skill provides the objective viewpoint from which the obviousness determination is made.  Importantly, however, the obviousness inquiry is further determined from the viewpoint of such ordinary skilled person at the time the invention was made.  In general, the invention is initially presumed to have been “made” on the filing date of the application; however, an earlier date of invention may be established in some circumstances.  Therefore, only patents or printed publications issued or published before the filing date (i.e., prior art) may be considered and used to invalidate a patent during litigation or serve as a basis for an obviousness rejection during prosecution of a patent application (with the caveat that published patent applications may be used as prior art before their date of issuance).

One of the greatest challenges facing courts during litigation and examiners during prosecution when analyzing the obviousness of an invention is avoiding hindsight bias in view of the prior art.  Hindsight bias refers to the tendency to improperly view the prior art in light of the invention once being made aware of the invention.  In other words, it is very difficult to go back in time and stand in the shoes of a person of ordinary skill in the art looking out prospectively into the future in view of the prior art at the time the invention was “made” to determine the obviousness of the invention while simultaneously avoiding any influence that may arise from knowledge of the invention in evaluating the teachings of the prior art references (i.e., avoiding the use of the patent applicant’s disclosure as a “roadmap” in piecing together the prior art references).  Studies have shown that hindsight bias exerts a strong influence on the obviousness analysis that tends to increase the likelihood of finding an invention obvious.  See, e.g., AIPLA Quarterly Journal, Vol. 37, No. 2: pp. 227–256 (Spring 2009).  Basically, inventions tend to appear more obvious in view of the prior art once the invention is known.

In reviewing numerous patent appeal cases over many years, the Court of Appeals for the Federal Circuit became very aware of the strong biasing effect of hindsight reasoning in influencing the obviousness analysis.  To protect against such improper hindsight reasoning, the Federal Circuit devised a test for determining the obviousness of an invention over the prior art, which came to be known as the teaching-suggestion-motivation (TSM) test.  Under the TSM test, a patent claim was generally proved obvious only if some motivation or suggestion to combine or modify the prior art teachings can be found either in the prior art itself, the nature of the problem to be solved, or the knowledge of a person having ordinary skill in the art.  As a result, the TSM test was effective in lessening hindsight bias by forcing the production of objective evidence to show why an invention should be considered obvious in view of the prior art.

However, many objected to the application of the TSM test as being overly rigid and leading to the issuance of too many “junk patents” due to the difficulty of showing evidence during prosecution to prove suggestion or motivation to combine or modify the teachings of the prior art specifically in the manner claimed.  In KSR Intl. Co. v. Teleflex Inc., 550 U.S. 398, 82 U.S.P.Q.2d 1385 (2007), the Supreme Court rejected this perceived mechanical application of the TSM test in reversing the Federal Circuit in that case.  Although the Court recognized that there is not necessarily an inconsistency between the idea underlying the TSM test and a proper obviousness inquiry and further that the TSM test may provide “helpful insight,” the Court rendered the TSM test practically ineffectual by not requiring it.  The Court reasoned that “[t]he obviousness analysis cannot be confined by a formalistic conception of the words teaching, suggestion, and motivation, or by overemphasis on the importance of published articles and the explicit content of issued patents. . . . In many fields it may be that there is little discussion of obvious techniques or combinations, and it often may be the case that market demand, rather than scientific literature, will drive design trends.  Granting patent protection to advances that would occur in the ordinary course without real innovation retards progress and may . . . deprive prior inventions of their value and utility.”

The Court in KSR memorably stated that “[a] person of ordinary skill is also a person of ordinary creativity, not an automaton.”  The Court reasoned that courts and patent examiners may look to any need or problem to provide a reason for combining prior art elements and that common sense teaches that familiar items have uses beyond their primary purposes.  The Court cautioned that “[w]hen 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 good reason to pursue the known options within his or her technical grasp [—i.e., they are ‘obvious to try.’].  If this leads to the anticipated success, it is likely the product not of innovation but of ordinary skill and common sense.”  The Court continued, “The combination of familiar elements according to known methods is likely to be obvious when it does no more than yield predictable results.”  Basically, the Supreme Court in KSR returned the obviousness analysis to a totality of the circumstances test based on underlying factual inquiries that were previously articulated in Graham v. John Deere Co. of Kansas City, 383 U.S. 1, 148 U.S.P.Q. 459 (1966):  (1) the scope and content of the prior art; (2) the differences between the prior art and the claims at issue; (3) the level of ordinary skill in the pertinent art; and (4) evidence of “secondary considerations,” such as commercial success, long felt but unsolved needs, failure of others, etc.

In the aftermath of KSR, however, many expressed concern that the removal of the TSM test without an alternative form of confinement would open the obviousness analysis to the influence of hindsight in crafting ex post reasoning to combine or modify prior art elements.  The concern was that allowing consideration of things like market demand, design trends, common sense, ordinary creativity, etc., would make the obviousness inquiry unduly permissive and open and would provide no basis to confine or control the inquiry against the biasing effect of hindsight reasoning.  A court or patent examiner could search for prior art references supplying the individual elements and features of the invention and then simply craft in retrospect a “token” motivation or reason for why a person of ordinary skill would modify or combine the teachings of the prior art in the manner claimed.  These concerns were not alleviated by the Court in KSR only briefly cautioning fact-finders against the pitfalls of ex post hindsight reasoning before continuing to explain the shortcomings of the TSM test.

Since KSR, many patent practitioners and others believe that these fears have been realized and that, particularly during prosecution, patent examiners too often rely on token or subjective motivations or reasons for a person of ordinary skill to combine or modify the teachings of the prior art in rejecting claims as obvious without providing objective evidence or reasoning to support the conclusion.  Even in KSR, the Court acknowledged that the reasoning should be made explicit and that “[r]ejections on obviousness grounds cannot be sustained by mere conclusory statements; instead, there must be some articulated reasoning with some rational underpinning to support the legal conclusion of obviousness.”  Courts since KSR have scrambled to fashion an alternative test or logical basis to properly confine the obviousness inquiry in practical terms to combat subjective ex post reasoning and the use of conveniently whimsical or token bases to combine or modify the teachings of the prior art.  For example, some courts have pointed to the language affirmed in KSR that “there must be some articulated reasoning with some rational underpinning to support the legal conclusion of obviousness” and that generalized conclusions without explicit explanation may not suffice. See, e.g., Innogenetics, N.V. v. Abbott Laboratories, 512 F.3d 1363, 85 U.S.P.Q.2d 1641 (Fed. Cir. 2006).

Recently, in In re Vaidyanathan (Fed. Cir. 2010), a Federal Circuit panel in a nonprecedential opinion vacated and remanded the decision of the Board of Patent Appeals and Interferences (the “Board”) holding that the claims of a patent application were obvious in view of the art of record.  The claimed invention of the subject patent application (U.S. Patent App. Serial No. 10/259,203) related generally to a method for guiding and controlling munitions at the “endgame” stage of flight when the munition is very close to its target by using a neural network that provides high-level commands to an autopilot that directs the actual movement of the munition.  The Board had affirmed the Examiner’s rejection of claims as obvious in view of U.S. Patent No. 6,473,747 (Biggers) and U.S. Patent No. 5,435,503 (Johnson).

On appeal to the Federal Circuit, the Applicant argued that the rejection of claims was based on a misunderstanding of the Biggers reference and that neither the Examiner nor the Board had made sufficient factual findings or adequately explained their reasoning.  Thus, the Applicant argued that there was a lack of substantial evidence to support the Board’s conclusion of obviousness.  According to the Applicant, claims of the subject ’203 application were directed to a neural network that sent commands to an autopilot to control a munition at the end stage of flight, whereas Biggers only taught using a neural network at the intermediate stage of flight without necessarily teaching control of an autopilot.  The Solicitor on behalf of the Patent and Trademark Office (PTO) argued instead that commands from the neural network in Biggers were sent to an autopilot to control flight of a munition.  According to the Solicitor, although not described explicitly in the specification, a person of ordinary skill would have understood box 44 of Fig. 3 in Biggers as providing implicit support for the commands being sent from the neural network to the autopilot.  The Solicitor further argued that the “zero A to A” command in Fig. 4 of Biggers is sent from the neural network and that traditional autopilots were known to function in this way as evidenced by the secondary Johnson reference.

The Applicant countered that Biggers teaches three independent and mutually exclusive systems for guiding flight of the munition at different stages of flight:  an autopilot, a neural network, and a terminal guidance system.  The Applicant further argued that the PTO bears the initial burden of showing obviousness and there have been three conflicting views offered by the PTO:  (1) the Examiner’s Answer stated that the neural network controls the guidance system, (2) the Board disagreed but stated that Fig. 3 should be reasonably understood as the autopilot, and (3) the Solicitor on appeal instead relies on autopilot functions being well known and further that the command sent to the autopilot in Fig. 4 is from the neural network.

The Federal Circuit in its opinion agreed with the Applicant that the PTO has offered divergent and shifting viewpoints relating to the question of patentability and particularly that, in contrast to the claims and specification of the subject ’203 application, the neural network appeared to relinquish control of the munition to a guidance system before striking the target.  Although the court stopped short of concluding that the PTO was wrong in its conclusion, the court vacated and remanded the case because in its view the Board had not persuasively and explicitly explained its reasoning or provided adequate findings of fact to support its prima facie conclusion of obviousness.  Further, the PTO’s shifting positions and factual discrepancies cast serious doubt on its reasoning, which impeached the normal deference owed to agency decisions.  The Applicant also objected to the absence of explicit findings with regard to the level of ordinary skill, but the court dismissed these concerns and held that the Board is not required to make express findings on the level of ordinary skill but nevertheless must provide sufficient explanation to support the obviousness determination as a whole.

In reaching its decision, the court stated that “[o]bviousness is determined as a matter of foresight, not hindsight. KSR did not free the PTO’s examination process from explaining its reasoning.  In making an obviousness rejection, the examiner should not rely on conclusory statements that a particular feature of the invention would have been obvious or was well known.  Instead, the examiner should elaborate, discussing the evidence or reasoning that leads the examiner to such a conclusion.  Generally, the examiner cites prior art references to demonstrate the state of knowledge.”  To support its reasoning in rejecting claims for want of novelty or obviousness, the examiner must cite the best references at his or her command. See 37 C.F.R. § 1.104(c)(2); MPEP § 706.02. Rule 1.104(c)(2) further states that “[w]hen a reference is complex or shows or describes inventions other than that claimed by the applicant, the particular part relied on must be designated as nearly as practicable.  The pertinence of each reference, if not apparent, must be clearly explained and each rejected claim specified.”  On the other hand, “[i]f it is not possible for the examiner to provide this type of information, the examiner might choose instead to provide an affidavit [according to 37 C.F.R. § 1.104(d)(2)] detailing the examiner’s own personal knowledge (as a person approximating one of ordinary skill in the art) of the technology in question.”

Although the court acknowledged that, in view of KSR, the cited references themselves “need not in every case provide a ‘specific hint or suggestion’ of the alteration needed to arrive at the claimed invention” and that “the examiner’s analysis may include recourse to logic, judgment, and ‘common sense’ available to a person of ordinary skill that do not necessarily require explication in any reference or expert opinion,” the examiner should at least explain “the logic or common sense that leads the examiner to believe the claim would have been obvious.  Anything less than this results in a record that is insulated from meaningful appellate review. If the examiner is able to render a claim obvious simply by saying it is so, neither the Board nor this court is capable of reviewing that determination.”  The court further reiterated that “rejections on obviousness grounds cannot be sustained by mere conclusory statements; instead, there must be some articulated reasoning with some rational underpinning to support the legal conclusion of obviousness.”  “If there is neither record evidence nor detailed examiner reasoning, the Board should not conclude that [the Applicant’s] claims are obvious.”

Although the In re Vaidyanathan decision was nonprecedential and may not be cited on appeal, the decision provides an indication of the direction the Federal Circuit may be taking.  Even though recourse may be made to additional motivations and reasons outside of the cited references, such as common sense, ordinary creativity, and the like, the obviousness inquiry must still be anchored in adequate findings of fact and sufficiently explicit reasoning to prove that a person having ordinary skill in the art would view the invention as being obvious over the prior art.

In reviewing the progression of case law from the rejection of the TSM test in KSR to the current leanings of the Federal Circuit in requiring an adequate showing of facts and reasoning, one must wonder how much meaningful change there has been to the law of obviousness after the KSR decision.  Indeed, while the obviousness inquiry following KSR may be more open to additional sources of reasons or motivations to combine or modify the teachings of the prior art, one may conclude that, in large part, the showing under the TSM test is simply being replaced with a similar requirement to adequately show evidence supported by facts and explicit reasoning to support the prima facie conclusion of obviousness.  Therefore, while arguments based on a lack of suggestion or motivation to combine or modify prior art references are not likely to receive much weight in light of KSR during prosecution of a patent application, patent practitioners should insist that Examiners provide factual findings and explicit reasoning to support their legal conclusion of obviousness.  Practitioners should further cite 37 C.F.R. § 1.104(c)(2) to demonstrate the Examiner’s duty to provide the best prior art and articulate the basis of rejection, and, in some cases, demand an affidavit from the Examiner under 37 C.F.R. § 1.104(d)(2) to support any unsubstantiated conclusions.  Although such arguments may not alter the course of prosecution before the Examiner, they may be found persuasive on appeal.

© 2022 Vedder PriceNational Law Review, Volume , Number 249
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About this Author

Angelo J. Bufalino, Vedder Price Law Firm, Intellectual Property Attorney
Shareholder

Angelo J. Bufalino has been practicing intellectual property law for over 29 years. He counsels clients in patent, trademark and copyright matters, including Intellectual Property Litigation and related licensing matters, and patent validity and infringement studies, and has extensive, worldwide experience in prosecuting patents and trademarks. He has appeared in federal district and appellate court litigation relating to products in various industries and technologies, in inter partes proceedings before the U.S. Patent and Trademark Office and in proceedings before the U.S. Patent...

312-609-7850
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