In FOX Factory, Inc. v. SRAM, LLC, Appeal No. 2018-2024 (Fed. Cir. Dec. 18, 2019), the Federal Circuit vacated the PTAB’s decisions upholding a bicycle chainring patent owned by SRAM. The Board incorrectly held that SRAM’s evidence of secondary considerations showed the patent is not obvious.

FOX Factory filed two IPRs seeking to cancel several claims of SRAM’s patent on obviousness grounds. The Board found the prior art references asserted by FOX Factory disclosed all the limitations of the patent’s independent claims and that a skilled artisan would have been motivated to combine the asserted prior art. SRAM provided evidence of secondary considerations including commercial success and industry praise, and the Board determined that SRAM was entitled to a presumption of nexus between the challenged claims and secondary considerations evidence pertaining to SRAM’s X-Sync chainrings. This led the Board to conclude that FOX had not shown that the challenged claims would have been obvious.

On appeal, the Federal Circuit vacated and remanded the Board’s determination, holding that the secondary considerations were not properly tied to the patent since the X-Sync included unclaimed features that may have contributed to its success. The Court said that the Board wrongly presumed a nexus, given that the patented invention related only to one of many features of the commercially successful bicycle chainring. While noting that there need not be a perfect match between the patent and the product, the Court held that the patentee must demonstrate that the product is “essentially the claimed invention.” Because here, SRAM described certain unclaimed features of its X-Sync chainring as “critical” in other patents, the Court concluded that a nexus could not be presumed.