Addressing the issue of whether secondary considerations for non-obviousness showing commercial success of a system allegedly infringing a patent could rebut prima facie evidence of obviousness, the Patent Trial and Appeal Board (Board) held that, in order to successfully argue commercial success, the patentee must show that the allegedly infringing system is commercially successful and a nexus exists between the purported commercial success of the allegedly infringing system and the practice of the claimed technology.Vibrant Media, Inc. v. General Electric Co., Case IPR2013-00170 (PTAB, June 26, 2014) (Chang, APJ.).

General Electric (GE) is the owner of a patent generally directed to a method and computer system for providing hypertext anchor codes and destination addresses for a user-readable text file automatically. GE sued Vibrant Media for allegedly infringing its patent, and Vibrant Media filed a petition requesting inter partes review of all 43 claims of the patent.

Vibrant Media argued that the claims were either anticipated or obvious.  In response to the obviousness argument, GE took the position that the commercial success of Vibrant Media’s products, which allegedly infringed the patent, showed that the subject matter of the claims would not have been obvious to a person having ordinary skill in the relevant art at the time of the invention.  Vibrant Media responded that GE had not shown that Vibrant Media’s system was commercially successful and GE had not shown a nexus between the purported commercial success and the practice of the techniques claimed in the patent.

To substantiate its position that Vibrant Media’s system was commercially successful, GE showed that Vibrant Media had over 6,600 publishers and more than 300 million unique users per month, 69 percent of 500 women surveyed indicated that they are more likely to pay attention to ads relevant to what they are reading, and online video spending is in the billions of dollars and growing.

In evaluating this evidence, the PTAB concluded that GE did not show that these numbers constitute commercial success when considered in relation to overall market share. GE did not provide the fee amounts that Vibrant Media charges its publishers or users, or any indication that the alleged number of publishers or users represents a substantial quantity in the overall market share.  In summary, GE did not show that Vibrant Media’s system was commercially successful and that there was a nexus between the commercial success and the alleged infringement of the patent.  In finding all 42 claims to be invalid under § 103, the Board concluded that the strong evidence of obviousness was, in balance, not outweighed by any secondary consideration.

Several notable evidentiary issues were also decided.  Specifically, GE argued that the rebuttal declaration provided by Vibrant Media’s expert witness, Dr. Hellman, should be excluded from evidence because it included improper rebuttal evidence that should have been presented with the petition.  The Board disagreed, stating that a motion to exclude is not a mechanism to argue that a reply contains new arguments or evidence necessary to make a prima facie case.  Instead, the motion to exclude must state why the evidence is inadmissible, identify the corresponding objections on record and explain the objection.

In addition, GE tried to exclude the rebuttal declaration of Dr. Hellman arguing that Dr. Hellman’s statements used certain wording—“within the grasp of one of ordinary skill in the art,” “being deterred” and being “not excluded”—that are not applicable legal standards under § 103.  The Board disagreed, finding that an expert may express her opinion using words that are not used expressly in the statute.  Furthermore, GE tried to exclude the rebuttal testimony of Dr. Hellman for providing legal opinions regarding obviousness.  Again, the Board disagreed, concluding that an expert may provide legal opinions, but that such testimony is neither necessary nor controlling.  Rather, the Board will decide what weight, if any, such testimony might carry.

Vibrant Media, Inc. v. General Electric Co. - AIA / IPR / Obviousness / Commercial Success