Circuit Check Inc. v. QXQ Inc.

Addressing the issue of obviousness, the U.S. Court of Appeals for the Federal Circuit reversed the district court and restored the jury’s verdict finding the patents-at-issue not invalid, because the prior art in dispute was not analogous and therefore could not be used for purposes of an obviousness. Circuit Check Inc. v. QXQ Inc., Case No. 15-1155 (Fed. Cir., Jul. 28, 2015) (Moore, J.).

Circuit Check sued QXQ alleging infringement of its patents for marking interface plates used on circuit board testers. In the prior art, the surface of the interface plate is painted and marked with shallow drill holes. By contrast, Circuit Check’s patents described using a second removable marked layer overlaying the first marked layer of the interface plate. QXQ argued that the second removable marked layer was obvious, citing references having no relation to circuit board testers (for example, references directed to rock carvings and engraved signage). In response, Circuit Check introduced evidence that a skilled artisan at the time of invention would not have considered art outside the field relevant to solving the marking problem addressed in its patents, as well as evidence that art outside the field could not be used to make the claimed invention.

The jury sided with Circuit Check, finding that the asserted claims were valid and that QXQ willfully infringed the patents. But, the district court granted QXQ’s motion for judgment as a matter of law (JMOL), finding the asserted claims invalid as obvious. In granting the QXQ’s motion, the district court acknowledged that QXQ’s obviousness argument was not premised on specific examples of prior art in the applicable field, nor relied on a nuanced discussion about the proper level of skill in the art. According to the district court, a lay person would have understood that interface plates could be marked using the techniques described in art outside the field circuit board testers. The district court noted, for example, that “any vandal who has ‘keyed’ a car knows that stripping the paint with a key will result in the underlying metal color showing through.” The district court further concluded that the additional limitations of certain dependent claims were too trivial to support a finding of non-obviousness, despite the fact that QXQ presented no evidence with respect to these additional limitations. Circuit Check appealed.

The Federal Circuit determined that three of the four Graham factors supported the jury’s validity finding, including the scope and content of the prior, the differences between the prior art and the claims at issue, and objective indicia of non-obviousness. The fourth factor, the level of ordinary skill in the art at the time invention, was not substantially in dispute. 
To be considered prior art for obviousness purposes “a reference must be analogous.” As the Federal Circuit explained, prior art is only analogous “if it is from the same field of endeavor or if it is reasonably pertinent to the particular the problem the inventor is trying to solve.” This, the Court clarified, is a question of fact. Because the references QXQ cited as supplying the missing claim limitations were outside the field of circuit board testers, those references were not analogous and could not be considered in the obviousness analysis. Squaring this finding with its opinion in KSR (IP Update, Vol. 9, No. 12) which stated that “familiar items may have obvious uses beyond their primary purposes,” the Court further clarified that “a reference is only reasonably pertinent when it logically would have commended itself to an inventor’s attention in considering his problem.”

The Court also noted that the record contained evidence that a person of ordinary skill in the art would not have considered rock carvings or engraved signage when considering how to mark interface plates for circuit board testers. As such, the jury was entitled to find that a skilled artisan would not have looked to these references to solve the problem addressed by Circuit Check’s patents and therefore conclude the references were not analogous.

With respect to the dependent claims, the Federal Circuit found that the district court erred by shifting the burden to patent owner to disprove invalidity. Because the patent claims are presumed valid, and defendant QXQ produced no evidence that these claims were obvious, it was improper for the district court to find the claims invalid for a lack of evidence supporting non-obviousness.

Practice Note: Although a teaching, suggestion or motivation to combine the prior art (i.e., the TSM test) is not required to support an obviousness argument, prudence dictates that it is nevertheless good practice to do so. Had defendant presented evidence of some teaching, suggestion or motivation to combine the art in the field with art outside the field, the Federal Circuit may have been less likely to find the art outside field non-analogous and improper to the obviousness analysis.