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Volume XI, Number 297

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October 22, 2021

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The Federal Circuit Reverses and Vacates Invalidity Determinations by the Board After Lack of Substantial Evidence Supported the Board’s Findings

IN RE: HODGES: February 12, 2018.  Before Lourie, O’Malley, and Wallach.

Takeaway:

  • While the “broadest reasonable interpretation” standard is broad, it does not give the Board an unfettered license to interpret the words in a claim without regard for the full claim language and the written description.

  • The Board must explain its factual conclusions so as to enable the appellate court to verify whether those conclusions are indeed supported by ‘substantial evidence’ contained within the record.

Procedural Posture:

Appellant Hodges appealed the Board’s affirmance of the examiner’s rejection of all claims as anticipated and/or obvious. The CAFC reversed the Board’s anticipation determinations, vacated its obviousness determinations, and remanded for further proceedings.

Synopsis:

  • Invalidity – Anticipation: The CAFC disagreed with the Board that an unlabeled valve disclosed in a cited reference, Rasmussen, is connected to, and therefore allows or prevents flow into an inlet port, as required by the disputed claim. The CAFC further rejected the notion that the seat of the unlabeled valve would be an internal part of and contained within the outer casing of a drain valve. The CAFC found that these findings were unsupported by substantial evidence, because the drawing cited as a basis for the rejection showed that the valve is external to and outside Rasmussen’s casing. Moreover, the CAFC disagreed with the “similarity” reasoning provided by the Board, and found that even if Rasmussen’s unlabeled valve is ostensibly similar to the relevant claim feature in some respects, it is different in the only respect that is relevant to the claims at issue, namely, whether it discloses a contained or internal portion within the valve body. Regarding the second piece or prior art cited by the Board, Frantz, the CAFC reasoned that the Board’s anticipation finding is predicated on an erroneous construction of “signal,” because the Board’s construction is inconsistent with the application’s written description. Quoting its prior decision in TriVascular, Inc. v. Samuels, 812 F.3d 1056, 1062 (Fed. Cir. 2016), the CAFC held that“[w]hile the broadest reasonable interpretation standard is broad, it does not give the Board an unfettered license to interpret the words in a claim without regard for the full claim language and the written description.”

  • Invalidity – Obviousness: The CAFC reversed the Board’s obviousness determination, because the Board did not explain how Rasmussen’s drain valve assembly could be modified as required by the rejected claim. The CAFC required of the Board to explicate its factual conclusions, enabling the appellate court to verify readily whether those conclusions are indeed supported by “substantial evidence” contained within the record. According to the CAFC, the Board failed to provide sufficient explanation to allow such review.

Judge Wallach, concurring-in-part and dissenting-in-part:

  • Invalidity: Judge Wallach found that the majority opinion went too far in reversing the Board’s anticipation finding with respect to Rasmussen. According to Judge Wallach, when an agency fails to make requisite factual findings or to explain its reasoning, the proper course, except in rare circumstances, is to remand to the agency for additional investigation or explanation. By reversing the Board’s determination that Rasmussen anticipates the asserted claims, the majority engages in the very de novo inquiry against which the Supreme Court has cautioned, thereby exceeding its appellate authority. Judge Wallach further reasoned that, because neither the majority nor the Board supported their assumptions, which are already mutually exclusive of one another, joining any of the two factual assumptions would be improper.

Copyright © 2021, Hunton Andrews Kurth LLP. All Rights Reserved.National Law Review, Volume VIII, Number 57
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About this Author

Gregory L. Porter, Intellectual Property Attorney, Andrews Kurth, Law Firm
Partner

Greg Porter has extensive experience representing and advising companies in all aspects of patent and trade secret law, including acting as lead counsel in successful jury trials and preliminary injunction hearings, as well as advising on patent procurement and designing around competitor's patents. Greg also has counseled Fortune 500 clients on the creation and management of their patent portfolios.

Over the years, Greg has successfully litigated cases in a diverse range of technologies from oil field tools to polymers and computer networking. Greg has drafted and...

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Jeremy litigates intellectual property rights underlying brands and innovations within a variety of industries, including banking and financial services, pharmaceuticals, fashion, electronics and computer software. Jeremy has represented major clients in trademark, copyright and patent litigation and trials in federal and administrative courts and § 337 ITC proceedings, and regularly counsels clients on IP due diligence and portfolio acquisition. He similarly assists luxury goods and consumer products companies enforce their intellectual property rights through anti-...

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Dragan Plavsic, Andrews Kurth, fuel cell systems lawyer, hybrid vehicles attorney
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Dragan represents firm clients in patent litigation matters and in the Patent Trial and Appeal Board proceedings. In addition, he prepares and prosecutes patent applications and provides IP counseling to clients. The range of services that he provides further includes validity opinions, freedom to operate opinions and due diligence. Dragan provides his clients with services in a wide variety of technologies, including automotive safety systems, telematics systems, and fuel cell systems, hybrid vehicles, oil and gas exploration and production, oil and gas processing and...

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