The U.S. Supreme Court roiled patent owners with the issuance of its May 2007 decision in KSR International Co. v. Teleflex Inc., 550 U.S. 398 (2007). The case struck at the heart of the U.S. Patent Statute by appearing to raise the standard for nonobviousness. In its wake the allowance rate for U.S. patent applications dropped and the number of district court decisions invalidating patents rose. But recent decisions of the U.S. Court of Appeals for the Federal Circuit have reigned in KSR’s impact in the district courts, especially for patents in unpredictable fields of invention.
The Supreme Court’s decision in KSR
The following summarizes the Supreme Court’s most significant pronouncements on obviousness in KSR:
1. The TSM test. Prior to May 2007, the U.S. Court of Appeals for the Federal Circuit (the appellate court responsible for all patent appeals) had relied on the teaching-suggestion-motivation (“TSM”) test to assess obviousness. The test generally required that, to deny an inventor’s patent claims based on a combination of prior art references, an examiner or patent challenger must show that the prior art would have taught, suggested, or motivated one skilled in the art to make the claimed invention. In KSR the Supreme Court rejected the Federal Circuit’s rigid application of the test. It said that a combination of references that collectively disclose all the elements of the inventor’s claims can be used to reject or invalidate the claims on grounds of obviousness, even when there is no explicit teaching, suggestion, or motivation to combine the elements as the inventor did.
2. Scope of the relevant prior art. The Supreme Court criticized prior court decisions for defining the sources of relevant prior art too narrowly. When considering an inventor’s patent claims, the Supreme Court said that an examiner or court should not look only at prior art addressing the problem that the inventor solved. In addition, prior art should be considered even if its primary purpose was not directed to the same problem as the invention. The Court thus encouraged examiners and courts to consider more diverse prior art than before, increasing the chance for patent claims to be rejected or invalidated.
3. Obvious to try. The Supreme Court questioned the Federal Circuit’s treatment of the "obvious to try" exception to obviousness. Under this exception, the Federal Circuit sometimes holds that teachings in the prior art merely showed that one skilled in the art would have found the claimed invention “obvious to try,” but not obvious. The Supreme Court cautioned that the “obvious to try” exception should not be applied in an inventor’s favor when (a) there is a need or market pressure to solve a problem, (b) there are a finite number of identified, predictable solutions, (c) a person of ordinary skill has good reason to pursue the known options, and (d) the claimed invention results directly from the pursuit of one of the options.
4. Combinations and unpredictable results. The Supreme Court’s KSR decision stated that a claimed combination of familiar elements according to known methods is “likely to be obvious” if the combination does not yield unpredictable results. It stopped short of requiring a showing of unpredictability, but when the claimed invention involves a “simple substitution of one known element for another or the mere application of a known technique to a piece of prior art ready for the improvement,” the Court said lower courts “must ask whether the improvement is more than the predictable use of prior-art elements according to their established functions.”
KSR has resulted in greater scrutiny of patent claims. Patent applicants more frequently find it necessary to defend against obviousness rejections and file expert declarations and evidence in support of nonobviousness, and the allowance rate for U.S. applications has declined. But the impact of KSR has been limited by the fact that many examiners and courts had already been testing obviousness in line with the Supreme Court’s 2007 pronouncements, and some of the Supreme Court’s seemingly anti-patent pronouncements in KSR were countered by the Court’s pro-patent statements in the same decision. In particular, where patent validity has been tested in recent decisions of the federal courts, the Supreme Court’s criticism of the Federal Circuit’s use of the TSM test has proven to be of little significance in unpredictable fields of invention and of limited significance in other arts as well.
Motivation as a Continuing Requirement for Showing Obviousness in Unpredictable Arts
Among the various statements in KSR, the Supreme Court’s criticism of the TSM test was the most unnerving for inventors and patent owners. But subsequent decisions of the Federal Circuit have restored the TSM test, or some modification of it, to near pre-2007 importance in the unpredictable arts. The test is sometimes couched in terms of a test for motivation, where motivation is measured by considering (a) the prior art starting point and the ease with which the starting point could have been modified by one of ordinary skill to achieve the invention and (b) the extent to which one of ordinary skill would have expected the invention to solve the problem at hand. In addition, the test can permit greater leeway for using non-prior art sources to assess the ease with which the modification could have been made. Nevertheless, proof of a sufficient level of motivation remains important in the Federal Circuit’s analysis.
Procter & Gamble Co. v. Teva Pharmaceuticals USA, Inc., 566 F.3d 989 (Fed. Cir. 2009) illustrates the Federal Circuit’s continued and prominent use of motivation as a deciding factor in determining obviousness. The defendant in Proctor & Gamble challenged the validity of P&G’s patent for the compound risedronate, a bisphosphonate used to treat osteoporosis. Bisphosphonates were generally known to be useful for this purpose, but clinical problems prevented their commercialization. P&G’s inventors experimented with hundreds of bisphosphonate compounds without success. They eventually identified risedronate as a promising drug candidate.
The defendant in Procter & Gamble cited a prior art reference listing 36 molecules and argued that one of the molecules, 2-pyr EHDP, was so structurally similar to risedronate that the patentee’s patent claims were invalid for obviousness. The district court disagreed, finding that the reference would not have led a person of ordinary skill to select 2-pyr EHDP, and that, in light of the extremely unpredictable nature of bisphosphonates, a person of ordinary skill would not have been motivated to make the necessary molecular modifications. The defendant appealed.
On appeal the Federal Circuit suggested anew that a patent challenger must show a teaching, suggestion, or motivation to combine in order to show obviousness in an unpredictable art. It said:
A party seeking to invalidate a patent based on obviousness must demonstrate by clear and convincing evidence that a skilled artisan would have been motivated to combine the teachings of the prior art references to achieve the claimed invention … . (Emphasis added). Id. at 994.
The Federal Circuit explained that the Supreme Court had found the TSM test to provide helpful insight as long as it is not applied rigidly and reasoned that “it remains necessary to identify some reason that would have led a chemist to modify a known compound in a particular manner to establish prima facie obviousness of a new claimed compound.” The Federal Circuit affirmed, concluding that the defendant failed to make a prima facie case of obviousness under the TSM test.
The Federal Circuit also rejected the defendant’s argument that the invention was obvious because the reference made it “obvious to try” risedronate. The court said the inventors were required to vary all parameters and try numerous possible choices, and the cited reference gave no guidance as to which parameters were critical and as to which options would succeed. According to the court, patents should not be invalidated on grounds it was obvious “to explore a new technology or general approach that seemed to be a promising field of experimentation, where the prior art gave only general guidance … .” Id. at 996.
The Federal Circuit has not contradicted the Supreme Court’s holdings in KSR and it will continue to reject claims in the unpredictable arts after KSR much as it did before KSR. In In re Kubin, 561 F.3d 1351 (Fed. Cir. 2009), for example, the court held that a “classic biotechnology invention”—polynucleotides encoding a protein—was obvious. Because of the protein’s important role in the human immune response, the court concluded that “one of ordinary skill would have recognized the value of isolating [the protein’s] cDNA and would have been motivated to apply conventional methodologies … to do so.” The court also rejected the inventors’ defense that the examiner had merely shown that the invention was “obvious to try” and not obvious.
In sum, KSR is likely to continue to impose an increased burden on applicants facing obviousness rejections in the PTO, but its impact on outcomes in the federal courts is much less pronounced than some had expected, and that impact will largely be limited to inventions in the predictable arts.