Addressing the proper standard of review of the factual determinations made by the Board of Patent Appeals and Interferences (BPAI or the Board), the U.S. Court of Appeals for the Federal Circuit vacated and remanded the BPAI’s decision that the claims on appeal were obvious. In re Chapman, Case No. 09-1270 (Fed. Cir. Feb. 24, 2010) (Dyk, J.).

The claims of the Chapman application were directed to a derivative antibody in which the two heavy chains of the antibody are linked to each other via a polymeric linker.

The examiner rejected the claims under 35 U.S.C. § 103 in view of prior art that described “linking antibody fragments to a polymer to increase an antibody’s circulating half-life for therapeutic purposes” and “linking two antibody fragments with a polymer to form a ‘dumbbell-shaped’ structure.” The Board affirmed the examiner’s obviousness rejection. On appeal, the U.S. Patent and Trademark Office (USPTO) conceded that the Board had misinterpreted the teachings of the prior art but argued that the errors were harmless.

The Federal Circuit first noted that the standard of review of Board’s factual findings is “substantial evidence.” The Court then applied the same “harmless error” rule that it applies to factual determinations from district courts. The Court found that the Board’s misinterpretation of the prior art was not harmless, as the misinterpretation called into question the Board’s legal determination of obviousness. In particular, two of the three errors were found to be harmful. First, the Court held that if the Board misinterpreted whether the prior art it taught the use of a polymer to link between the light chain and the heavy chain of an F(ab’)2 antibody fragment, then Chapman’s invention (i.e., using a polymer to link two F(ab’) fragments) “may be less obvious.” Second, “if the Board did not appreciate the full scope of antibody fragments disclosed in [the prior art],” then the Court could not “be confident about its ultimate conclusion that the selection of one of them to form Chapman’s molecule is obvious, as it appears that there are more possibilities from which to choose.” Therefore, because the Court could not “say with confidence that the Board would have reached the same conclusion in the absence of these errors,” it held that the errors were “indeed harmful.”

Practice Note: Interestingly, despite the fact that the Board had made several prejudicial errors in making its obviousness determination, the Court did not reverse the Board’s legal conclusion of obviousness. Instead, the Court remanded the case so that the Board can “revisit” its obviousness assessment in view of a correct understanding of the prior art.

This case suggests that a Board’s error is harmful if the error increases the likelihood that the Board’s assessment of patentability is erroneous or if the Federal Circuit cannot confidently conclude, upon appellate review, that the Board would have reached the same decision in the absence of the error.