KSR Int’l Co. v. Telefl ex Inc. 127 S. Ct. 1727 (2007)
The U.S. Supreme Court issued a landmark decision on April 30, 2007 that is likely to have a significant impact on both patent prosecution and patent litigation. The decision affects the obviousness standard under section 103 of the Patent Act. The case: KSR Int’l Co. v. Telefl ex Inc., 127 S. Ct. 1727 (2007). The technology at issue: an adjustable pedal system for cars. The new standard for obviousness: “common sense.” This article takes a closer look at the KSR decision itself, along with the Federal Circuit’s actions in anticipation of the decision, the Federal Circuit’s reaction to the decision and the Patent Offi ce’s reaction to the decision. Although it will likely be some time before the implications of the KSR decision are clearly established, it appears all but certain that, in view of the KSR decision, courts are likely to broaden the scope of the obviousness inquiry by using a more fl exible obviousness standard that allows the courts to consider more factors during an obviousness inquiry.
U.S. Patent No. 6,237,565, the patent owned by Telefl ex at issue in the suit, is directed toward an adjustable pedal assembly for use with automobiles that are controlled electronically with a device known as an electronic throttle control. The district court explained, among other things, that U.S. Patent No. 5,010,782 (Asano) disclosed all of the structural limitations of the claim at issue with the exception of the electronic control. Since electronic controls were well known in the art, the district court concluded that a person of ordinary skill in the art would have been motivated to combine the teachings of Asano and electronic control references and therefore granted KSR’s motion for summary judgment of invalidity by reason of obviousness. The Federal Circuit found that the district court was required, yet failed, to make specifi c fi ndings as to a suggestion or motivation to attach an electronic control to the support bracket of the Asano assembly.
In taking up the fi rst patent case related to obviousness since 1976, the U.S. Supreme Court held that the Federal Circuit addressed the obviousness question in a narrow, rigid manner that is inconsistent with section 103 and the Supreme Court’s precedents. The Supreme Court stated that when a work is available in one fi eld of endeavor, design incentives and other market forces can prompt variations of it, either in the same fi eld or a different one. This analysis, however, need not seek out precise teachings directed to the specifi c subject matter of the challenged claim because a court can take account of the inferences and creative steps that a person of ordinary skill in the art would employ. Thus, instead of rigidly applying the teachingsuggestion- motivation (TSM) test, a court must take a more fl exible approach that allows fact fi nders recourse to common sense when evaluating obviousness under section 103.
The Supreme Court reemphasized that the framework set forth in its 1966 decision in Graham v. John Deere Co., 383 U.S. 1 (1966), and the factors described therein control an obviousness inquiry. First, a court must ask whether the improvement is more than the predictable use of prior art elements according to their established functions. Second, there must be an apparent reason to combine the known elements in the fashion claimed by the patent at issue. By rigidly requiring that there must be a teaching, suggestion or motivation to combine the known elements where no such teaching, suggestion or motivation exists, however, a court would fi nd subject matter nonobvious in cases where the claimed subject matter might include creative steps that a person of ordinary skill in the art would employ. Thus, while demonstrating that a teaching, suggestion or motivation to combine known elements exists may be helpful to show obviousness, the lack of a teaching, suggestion or motivation cannot alone lead to a fi nding of nonobviousness.
The Court notes that it will often be necessary for a court to look to interrelated teachings of multiple patents; the effects of demands known to the design community or present in the marketplace; and the background knowledge possessed by a person having ordinary skill in the art, all in order to determine whether there was an apparent reason to combine the known elements in the fashion claimed by the patent at issue. For example, if there existed at the time of invention a known problem for which there was an obvious solution encompassed by the patent’s claims, the patent’s subject matter is obvious. Common sense teaches that familiar items may have obvious uses beyond their primary purposes, and in many cases a person of ordinary skill will be able to fi t the teachings of multiple patents together like pieces of a puzzle. Rigid preventive rules that deny fact fi nders recourse to common sense, however, are neither necessary under the Supreme Court’s case law nor consistent with it.
As the Supreme Court recognized, the Federal Circuit apparently sensed the direction the Supreme Court was going and applied a broader conception of the TSM test prior to the Supreme Court’s decision in KSR. In one case after the Supreme Court decided to hear the KSR case but prior to the Supreme Court’s decision in KSR, the Federal Circuit said, “There is fl exibility in our obviousness jurisprudence because a motivation may be found implicitly in the prior art. We do not have a rigid test that requires an actual teaching to combine . . . .” Alza Corp. v. Mylan Labs, Inc., 464 F.3d 1286 (2006) (affi rming the district court’s fi nding of obviousness). The Federal Circuit, in supporting its TSM test, argued that “clearly the Court [in Graham] recognized the importance of guarding against hindsight, as is evident in its discussion of the role of secondary considerations as ‘serv[ing] to guard against slipping into use of hindsight and to resist the temptation to read into the prior art the teachings of the invention in issue.’” Thus, the “motivation to combine” requirement prevents statutorily proscribed hindsight reasoning when determining the obviousness of an invention. This test, however, need not be explicit. In fact, the Federal Circuit stated that “under our non-rigid ‘motivation-suggesting-teaching’ test, a suggestion to combine need not be found in the prior art.”
In a second case decided by the Federal Circuit prior to the Supreme Court’s KSR decision, the Federal Circuit said, “Our suggestion test is in actuality quite fl exible and not only permits, but requires, consideration of common knowledge and common sense.” DyStar Textilfarben GmbH & Co. Deutschland KG v. C.H. Patrick Co., 464 F.3d 1356 (2006). In fi nding that the claimed method for dyeing textile material with indigo was obvious, the Federal Circuit looked towards the Graham factors: (1) the scope and content of the prior art; (2) the differences between the claimed invention and the prior art; (3) the level of ordinary skill in the art; and (4) any relevant secondary considerations, including commercial success, long felt but unresolved needs, and failure of others. In evaluating the scope and content of the prior art, the Federal Circuit notes that the prior art does not contain a teaching to combine the teachings of the references. Nonetheless, the Federal Circuit said that there only needs to be an implicit motivation to combine references and that the proper question is “whether the ordinary artisan possesses the knowledge and skills rendering him capable of combining the prior art references.” There exists an implicit motivation to combine references not only when a suggestion may be gleaned from the prior art as a whole, but also when the “improvement” is technologyindependent and the combination of references results in a product or process that is more desirable, for example because it is stronger, cheaper, cleaner, faster, lighter, smaller, more durable or more effi cient. “Because the desire to enhance commercial opportunities by improving a product or process is universal —and even common-sensical—we have held that there exists in these situations a motivation to combine prior art references even absent any hint or suggestion in the references themselves.” Thus, the Federal Circuit in DyStar defended its TSM test and showed how it related to the Graham factors. The Federal Circuit also reiterated that the teaching, suggestion or motivation to combine references could be implicit.
There has been much speculation since the KSR decision as to the after-effects the decision will have on patent prosecution and patent litigation. For example, some suggest that, for patent prosecution, it might be wise to take any presently allowable subject matter before any KSR after-effects are felt and then fi le a continuation for any remaining subject matter not yet in condition for allowance. On the litigation side, the initial reaction appears to be that defendants, at a minimum, may have an easier time in arguing that patents in suit were obvious at the time of invention. Although theories exist as to what effect the KSR decision may have on patent practice, the true test will be to wait and see how the courts and Patent Offi ce react to the KSR decision.
In the first decision from the Federal Circuit since the KSR decision, the Federal Circuit affi rmed the district court’s fi nding of obviousness. Leapfrog Enter., Inc. v. Fisher-Price, Inc., 485 F.3d 1157 (Fed. Cir. 2007). More specifi cally, the Federal Circuit found that Leapfrog’s patent, U.S. Patent No. 5,813,861, directed to an interactive learning device, was obvious because it did nothing more than apply modern electronics to a prior art mechanical device. The court said that an obviousness determination is not the result of a rigid formula disassociated from the consideration of the facts of a case. “Indeed, the common sense of those skilled in the art demonstrates why some combinations would have been obvious where others would not.” The Federal Circuit believed that one of ordinary skill in the art of children’s learning toys would have found it obvious to combine the prior art in order to gain the commonly understood benefi ts of such adaptation, such as decreased size, increased reliability, simplifi ed operation and reduced cost. As some commentators have noted, this case would likely have been decided the same with or without KSR, but nonetheless the Federal Circuit used this opportunity to cite KSR and emphasize the nonrigid, common-sense approach for evaluating obviousness.
Perhaps a more interesting case was decided on July 26, 2007 in the Northern District of California. Friskit, Inc. v. Realnetworks, Inc., No. 3:03-cv-05085- WWS (N.D. Cal. July 26, 2007). The judge relied on and cited to KSR in fi nding that the patents in suit were invalid because of obviousness, and therefore granted the defendants’ motion for summary judgment. The interesting part, however, is that the judge previously denied a similar motion prior to the KSR decision. After KSR, Realnetworks asked the judge to reconsider the motion, and, because of KSR, the judge changed his mind and found the patents obvious in view of the prior art.
KSR has also created some reaction in the Patent Offi ce as well. In a notice last modifi ed on July 23, the U.S. Patent Offi ce announced that it has “sent to the Offi ce of Management and Budget (OMB) for review draft fi nal guidance for use by patent examiners in determining if an invention is obvious in view of the U.S. Supreme Court’s decision in KSR v. Telefl ex. The USPTO will post the fi nal guidance document on its website after OMB concludes its review. In the interim, the agency will begin training for examiners on implementation of KSR.” U.S. Patent & Trademark Offi ce, Draft KSR Training Guidelines under OMB Review (July 23, 2007), http://www.uspto.gov/web/ patents/notices/ksrguidance.htm. Although the Patent Offi ce has declined to publicly take any additional position, rumors are surfacing. For the time being, however, patent examiners have allegedly been told to continue to examine patent applications under the current standards and to thus continue to show that a teaching, suggestion or motivation exists to combine references. Others have also noted that the Board of Patent Appeals has taken a dramatic shift in dealing with the obviousness question, now citing KSR and deciding cases that appear to be inconsistent with the outcomes of similar issues decided prior to KSR. See, e.g., Ex parte Kubin, Appeal 2007-0819 (B.P.A.I. May 31, 2007) (stating “the Supreme Court recently cast doubt on the viability of Deuel to the extent the Federal Circuit rejected an ‘obvious to try’ test. Under KSR, it’s now apparent ‘obvious to try’ may be an appropriate test in more situations than we previously contemplated . . .”).
While the Federal Circuit appears to suggest that its decisions are consistent with the KSR decision, the general consensus is that KSR’s “common sense” approach to obviousness is broader than the TSM test as the Federal Circuit has been applying it. Thus, it is likely that the obviousness standard and its application have changed. It is worth noting, however, that courts may still apply the TSM test in fi nding obviousness; the difference is that something may now be deemed obvious even without the TSM test as previously applied. It remains to be determined what the actual implications of KSR may be, but what is clear is that any future test relating to obviousness must be fl exible and allow consideration of any factors relevant to an obviousness inquiry—not just whether there is a teaching, suggestion or motivation to combine the references.