Judges: Michel, Archer, Dyk (author) [Appealed from the Board]
In Brand v. Miller, No. 06-1419 (Fed. Cir. May 14, 2007), the Federal Circuit reversed the Board’s decision entering judgment in favor of Thomas Miller and others (collectively “Miller”) on the issue of priority. The invention relates to methods of cutting veneer from wood logs. Typically, logs are cut lengthwise into “fitches,” which are held in place by clamping “dogs” on a rotating apparatus for veneer cutting. Because logs are usually tapered, the ends were often cut off to allow for more uniform cuts. The invention provides for a more efficient use of the wood by allowing a tapered fitch to be mounted such that the veneer-producing face is parallel to the cutting knife.
Thomas Miller was a production manager at Miller Veneers, Inc. and is the named inventor of U.S. Patent No. 5,865,232 (“the ’232 patent”), directed to this technology. Robert Brand was the chief engineer at Capital Machine Company and the named inventor of U.S. Patent Application No. 09/377,120 (“the ’120 application”). On April 28, 2004, the Board declared an interference based on a single count, which is identical to claims in the ’232 patent and the ’120 application, although the inventors used different methods to solve the problem of attaching a tapered fitch to the apparatus. Specifically, the ’232 patent employs radially expandable round “collett dogs,” and the ’120 application uses multiheaded tall pin dogs.
Brand was named the senior party, having filed his application on May 31, 1995, and Miller was the junior party. The Board held that Miller failed to prove it reduced to practice first and, therefore, was not entitled to priority on that basis. However, the Board awarded priority to Miller because it found that Brand derived the invention from Miller. Brand filed a request for rehearing, which the Board denied. Brand appealed.
On appeal, the Federal Circuit first addressed the standard of review for cases from the Board. Specifically, the Court noted that “35 U.S.C. § 144 directs us to review ‘on the record’ the decisions of the Board.” Slip op. at 8 (citation omitted). Therefore, the Court explained, the Board’s finding must be supported by substantial evidence within the four corners of the record. The Court also noted that the Supreme Court has specifically “rejected an agency’s attempt to rely on its own expertise in a contested proceeding.” Id. at 9. An agency’s expertise cannot substitute for record evidence; otherwise, effective judicial review would be impossible. Moreover, the Court recognized that PTO regulations also highlight the importance of a detailed record and the Board’s role as an impartial adjudicator of a dispute between two parties. Thus, the Federal Circuit held that, in a contested case, “it is impermissible for the Board to base its factual findings on its expertise, rather than on evidence in the record, . . . .” Id. at 10.
Second, the Federal Circuit turned to the facts of the case and reversed the Board’s decision to award priority to Miller, reasoning that the Board substituted its own expertise for record evidence that Miller was obligated to prove. To prove derivation, the junior party must demonstrate (1) prior conception of the claimed subject matter, and (2) communication of that conception to the patentee sufficient to enable the patentee to construct and successfully operate the invention. In the present case, the Board rejected as unconvincing Miller’s testimony that he told Brand how to practice the invention and there was no testimony from one skilled in the art that the drawing communicated an enabling disclosure. Rather, the Court found that the Board improperly used its own expertise to interpret the drawings of record and conclude what the artisan would have deduced from the drawings in the absence of any explanation on the record. The Court also found that nothing in the record supports the path the Board determined a skilled artisan would have followed to arrive at the invention.
Accordingly, the Court held that the Board’s decision was not supported by substantial evidence of record, reversed the award of priority in favor of Miller, and ordered that judgment be entered in favor of Brand.