As noted in our post of April 23, 2015, in Intri–Plex Technologies, Inc. and Mmi Holdings, Ltd., v. Saint–Gobain Performance Plastics Rencol Limited, IPR2014–00309 (Paper 83), the Board relied on Applicant’s Admitted Prior Art in its obviousness analysis, and determined that the first three Graham factors (i.e. scope and content of prior art, differences between the claim and prior art, and level of one of ordinary skill in the art) favored a determination that the challenged claims were obvious.  See id. (citing Graham v. John Deere Co. of Kansas City, 383 U.S. 1, 17-18 (1966)). However, interestingly in a rare decision, the Board held that the fourth Graham factor (i.e. objective indicia of non-obviousness) outweighed a favorable determination of the other three factors.  Thus, the Board did not invalidate any of the challenged claims.

In its analysis, the Board found that two secondary considerations (commercial success and copying) were strong enough to uphold the challenged claims.  The Board placed a particular emphasis on commercial success, and held that “commercial success alone sufficiently outweighs the other three factors, and that our finding of copying merely strengthens further our finding that second considerations weigh in favor of Saint-Gobain.” See Intri-Plex, IPR2014-00309 (Paper 83, p. 46).

The Board found that the commercial success in this case was strong because sales of the patented product (which included flared tolerance rings for bearing assembles) surpassed other tolerance ring designs (i.e. non-flared) within three years of the patented product’s introduction, and surpassed all other technologies used for fixing bearings cartridges in bores, such as adhesives, and screws within six years of introduction.  The Board noted that sales of the patented product exceeded over one-half billion units and had achieved a dominant market share. Id. at p. 36.

In addition to determining that the patented product had commercial success, the Board also determined that the commercial success was related to the merits of the invention (i.e. the flared guide portion of the tolerance ring).  For example, Patent Owner produced evidence showing a difference in sales between flared tolerance rings and competing technologies since flared rings were introduced into the market, indicating that there was a market demand for flared rings. Id. at p. 38. The Board’s findings were further supported by Petitioner’s admission that it eventually made tolerance rings with flared guide portions due to customer requests. Id. at p. 37.  Thus, the Board held that Patent Owner established a nexus between the commercial success and the claimed invention, and the findings of commercial success “weigh[ed] heavily in favor of non-obviousness.”