FOX FACTORY, INC. v. SRAM, LLC

Before Prost, Wallach, and Hughes. Appeal from the Patent Trial and Appeal Board (PTAB).

Summary: When a commercial product contains unclaimed features, a presumption of nexus between the claims and secondary consideration evidence can be assumed only if unclaimed features of the commercial product do not materially impact the functionality of the product.

Fox filed two petitions for inter partes review (“IPR”) of a patent owned by SRAM directed to a chainring structure for bicycles. The Board found that a combination of two prior art references disclosed every limitation of the independent claims, and that a skill person would have been motivated to combine the references. However, the Board found that Fox had not shown that the challenged claims would have been obvious in view of evidence of secondary considerations. In making this determination, the Board assumed that SRAM was entitled to a presumption of nexus between the challenged claims and SRAM’s X-Sync chainrings commercial product. Fox appealed.

The Federal Circuit affirmed the Board’s determination that a skilled artisan would have been motivated to combine the asserted prior art; however, the Federal Circuit vacated the Board’s obviousness determination and remanded for reevaluation of the evidence of secondary considerations with the burden of proving nexus on SRAM. In its decision, the Federal Circuit found that the Board erred in presuming a nexus because no reasonable fact finder could find SRAM’s commercial chainrings to be coextensive with the claims. In reaching this conclusion, the Federal Circuit relied on undisputed evidence that SRAM’s commercial chainrings included unclaimed features that SRAM described as critical to the function of the product. The Federal Circuit explained that, on remand, SRAM would have the opportunity to prove that the evidence of secondary considerations is attributable to the claimed combination of features rather than prior art features or unclaimed features.