On April 30th, the Supreme Court issued its opinion in the KSR International Co. vs. Teleflex Inc., 550 U.S. ____(2007); known in patent circles as the "obviousness" case. Patent practitioners continue to scrutinize and discuss the opinion to ascertain potentially significant effects on issued patents, i.e., with respect to validity and enforcement thereof, and the examination of patent applications before the United States Patent and Trademark Office. By most accounts, with this opinion, the Supreme Court has changed one of the cornerstone tests for patentability - obviousness - arguably making it substantially more difficult to both obtain and enforce patents.
Set forth herein are various identified issues resulting from the opinion, along with potential impacts on both substantive and procedural law. As with all legal decisions, the actual impacts of the opinion are years in the making. The speculative impacts provided herein are intended to inform readers of the areas of their practice(s) which may be affected by the opinion.
At the heart of the controversy is the Federal Circuit’s teaching/suggestion/motivation test (“TSM test”). The Court arguably does not reject the TSM test, but instead rejects the TSM test as the singular, required test for establishing obviousness. The Court rejects the Federal Circuit’s “rigid approach” and focuses on a “flexible” and “functional” approach . Slip op. at 11-12. In addition to the TSM test, the Court identifies other “tests” or “factors” which may be helpful in determining obviousness:
- “Common sense” - “Common sense teaches, however, that familiar items may have obvious uses beyond their primary purposes, and in many cases a person of ordinary skill will be able to fit the teachings of multiple patents together like pieces of a puzzle.” Slip op. at 16-17.
- “Predictable results” - “The combination of familiar elements according to known methods is likely to be obvious when it does no more than yield predictable results.” Slip op. at 12.
- “Synergy” – “The device, the Court concluded, did not create some new synergy: The radiant-heat burner functioned just as a burner was expected to function; and the paving machine did the same. The two in combination did no more than they would in separate, sequential operation.” Slip op. at 12-13, citing Anderson’s-Black Rock, Inc. v. Pavement Salvage Co., 396 U. S. 57, 60-62 (1969).
- “Design incentives and other market forces” – “When a work is available in one field of endeavor, design incentives and other market forces can prompt variations of it, either in the same field or a different one.” Slip op. at 13.
- “Known problem” – “One of the ways in which a patent’s subject matter can be proved obvious is by noting that there existed at the time of invention a known problem for which there was an obvious solution encompassed by the patent’s claims.” Slip op. at 16.
- “Obvious to try” – previously not recognized as a proper rationale for supporting finding of obviousness, the Court states, “The same constricted analysis led the Court of Appeals to conclude, in error, that a patent claim cannot be proved obvious merely by showing that the combination of elements was “obvious to try.” Slip op. at 17. When there is a design need or market pressure to solve a problem and there are a finite number of identified, predictable solutions, a person of ordinary skill has good reason to pursue the known options within his or her technical grasp. If this leads to the anticipated success, it is likely the product not of innovation but of ordinary skill and common sense. In that instance the fact that a combination was obvious to try might show that it was obvious under §103.” Id.
The opinion also arguably expands the “knowledge” of a person having ordinary skill in the art to include a level of “creativity.” Support for this expansion includes the following language from the opinion:
- “[T]ake account of the inferences and creative steps that a person of ordinary skill in the art would employ.” Slip op. at 14.
- “A person of ordinary skill is also a person of ordinary creativity, not an automaton.” Slip op. at 17.
This additional creativity afforded to the person having ordinary skill in the art would likely result in more combination inventions being found to be obvious.
In addition to these newly articulated or resurrected tests or factors for proving obviousness, the Court also addressed factors which may be used to rebut an assertion of obviousness. Most notably, evidence of “unexpected results” from the combination or the art “teaching away” from the combination may rebut an assertion of obviousness. Slip op. at 12. While the Court may have weakened the “non-analogous art” rebuttal (Slip op. at 13) and reduced the weight given to secondary considerations, e.g., commercial success (Slip op. at 9).
The Court does maintain the requirement that a case of obviousness should be made explicit, citing to In re Kahn, 441 F. 3d 977, 988 (CA Fed. 2006) (“[R]ejections on obviousness grounds cannot be sustained by mere conclusory statements; instead, there must be some articulated reasoning with some rational underpinning to support the legal conclusion of obviousness”). Slip op. at 14. The Court explicitly recognizes that, “a patent composed of several elements is not proved obvious merely by demonstrating that each of its elements was, independently, known in the prior art.” Id. The Court directs the lower courts as follows:
- Often, it will 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.
The maintenance of this requirement for “articulated reasoning” may resonant loudest with patent prosecutors who are fearful of what types of obviousness rejections may be issued by the Patent Office in view of the opinion. On May 3rd, the Patent Office issued a memorandum to the Examiners setting forth interim guidelines for establishing a prima facie case of obviousness in the wake of the opinion. Appropriately, the memorandum echoes the opinion stating, “Therefore, in formulating a rejection under 35 U.S.C. §103(a) based upon a combination of prior art elements, it remains necessary to identify the reason why a person of ordinary skill in the art would have combined the prior art elements in the manner claimed.”
Importantly, the Court does not submit that the outcomes in the myriad of Federal Circuit cases decided under the TSM test would necessarily have been different upon application of the Court’s more flexible approach. The Court states, “In the years since the Court of Customs and Patent Appeals set forth the essence of the TSM test, the Court of Appeals no doubt has applied the test in accord with these principles in many cases. There is no necessary inconsistency between the idea underlying the TSM test and the Graham analysis.” Slip op. at 15. Accordingly, issued patents may not be as susceptible to invalidity on obviousness grounds under the Court’s standard as might have been initially thought. One caveat to this generalization stems from the assertion of art not previously before the Patent Office. The Court does hint at the possibility that there might be a reduced presumption of validity when the art supporting the obviousness assertion was not considered by the Patent Office. More particularly, the Court states, “We nevertheless think it appropriate to note that the rationale underlying the presumption—that the PTO, in its expertise, has approved the claim—seems much diminished here [i.e., where the Asano reference was not in front of the Office].” Slip op. at 23.
In addition to possible impacts on the presumption of validity, the opinion also raises questions regarding the law/fact dichotomy that currently defines obviousness. There is some suggestion that obviousness should be regarded purely as a question of law. More specifically, the Court notes that "[t]he ultimate judgment of obviousness is a legal determination," rejects the ability of a "conclusory affidavit[s] addressing the question of nonobviousness" to create a fact issue, and shows concern only to whether the first three Graham factors are "in material dispute." Slip op. at 23. Further, the Court acknowledges that the final step in the obviousness determination, i.e., whether a person having ordinary skill in the art would modify the prior art, is identified as a "legal question." Slip op. at 21. Such a categorization would change the standard of review and likely result in an increase of dispositions on summary judgment.