In Fox Factory , Inc. v. SRAM, LLC, [2018-2024, 2018-2025] (December 18, 2019), the Federal Circuit vacated and remanded the district court’s determination that claims 1–6 and 13–19 of U.S. Patent No. 9,182,027 were not obvious based on its analysis of secondary considerations.
The independent claims of the ’027 patent — claims 1, 7, 13, and 20 — recite a bicycle chainring with alternating narrow and wide tooth tips and teeth offset from the center of the chainring. From the Court’s decision:
Bicycle chainrings are the toothed disks to which the bicycle crankarms are attached, collectively forming the crankset. Pedaling the crankarms rotates the chainring, which engages with and rotates the chain. Chains can be susceptible to disengaging from the chainring.
… the ’027 patent discloses a chainring with alternating narrow and wide tooth tips, which allegedly improves chain retention …. Claims 7–12 and 20–26 generally cover tooth tips offset toward the body of the bicycle (“inboard offsets”), and claims 1–6 and 13–19 require teeth offset away from the body of the bicycle (“outboard offsets”).
The Board determined that SRAM was entitled to a presumption of nexus between the challenged outboard offset claims and secondary considerations evidence pertaining to SRAM’s X-Sync products, subject to two limitations. First, the Board stated that evidence of secondary considerations “specifically directed” to either an inboard or outboard offset X-Sync product is only entitled to a presumption of nexus with the claims reciting the same type of offset. Second, the Board explained that the presumption of nexus only applies when a product is “coextensive” with a patent claim.
On appeal, FOX contended that the Board applied the wrong standard for determining whether SRAM was entitled to a presumption of nexus between the challenged claims and SRAM’s evidence of secondary considerations, and the Federal Circuit agreed.
In order to accord substantial weight to secondary considerations in an obviousness analysis, the evidence of secondary considerations must have a “nexus” to the claims, i.e., there must be a legally and factually sufficient connection’ between the evidence and the patented invention. The Federal Circuit noted that the patentee bears the burden of showing that a nexus exists. To determine whether the patentee has met that burden, the consideration is the correspondence between the objective evidence and the claim scope.
A patentee is entitled to a rebuttable presumption of nexus between the asserted evidence of secondary considerations and a patent claim if the patentee shows that the asserted evidence is tied to a specific product and that the product is the invention disclosed and claimed. Conversely, when the thing that is commercially successful is not coextensive with the patented invention — for example, if the patented invention is only a component of a commercially successful machine or process — the patentee is not entitled to a presumption of nexus.
The existence of one or more unclaimed features, standing alone, does not mean that nexus may not be presumed. There is rarely a perfect correspondence between the claimed invention and the product. The purpose of the coextensiveness requirement is to ensure that nexus is only presumed when the product tied to the evidence of secondary considerations is the invention disclosed and claimed. If the unclaimed features amount to nothing more than additional insignificant features, presuming nexus may nevertheless be appropriate.
The Federal Circuit explained that the degree of correspondence between a product and a patent claim falls along a spectrum. At one end of the spectrum lies perfect or near perfect correspondence. At the other end lies no or very little correspondence, such as where the patented invention is only a component of a commercially successful machine or process.
In the instant case, the Federal Circuit concluded that no reasonable fact finder could conclude, under the proper standard, that the X-Sync chainrings are coextensive with the ‘027 patent claims. The Federal Circuit noted that the chainrings include unclaimed features that the patentee describes as “critical” to the product’s ability to “better retain the chain under many conditions” and that go to the “heart” of another one of Patent Owner’s patents. The Federal Circuit said that, in light of the patentee’s own assertions about the significance of the unclaimed features, no reasonable fact finder could conclude that these features are insignificant.
Because it could not say that the X-Sync chainrings are the invention claimed by the independent claims, the Board erred in presuming nexus between the independent claims of the ’027 patent and secondary considerations evidence pertaining to the X-Sync chainrings. Because the Board erroneously presumed nexus between the evidence of secondary considerations and the independent claims, the Federal Circuit vacated the Board’s non-obviousness determination and remanded for further proceedings. On remand, the Federal Circuit said that the Patent Owner will have the opportunity to prove the nexus between the challenged independent claims and the evidence of secondary considerations.