More on KSR v. Teleflex: Deuel and "obvious to try"

from

http://www.mercurynews.com/opinion/ci_5807057

Many of the 180,000 patents granted each year aren't for breakthrough ideas but for combining old ideas into new ones.

Sometimes the combination is brilliant (think of the Post-it Note or the integrated circuit). But in many cases, the insight would be obvious to anyone working in the field, which means the idea shouldn't receive the 17-year monopoly a patent provides.

Unfortunately, the U.S. patent office and the federal court that hears patent appeals have long relied on strict rules that make it unreasonably difficult to prove an idea is "obvious." As a result, thousands of weak patents have been granted, hampering real innovation (among the most infamous: Amazon.com's patent on a "one-click" Internet ordering system).

On Monday, the U.S. Supreme Court acted on years of complaints and dramatically reined in the runaway system.

Ruling unanimously in KSR International vs. Teleflex, the court said that patent examiners and judges need to look broadly at how creative people normally combine ideas to solve problems instead of relying on narrow, rigid tests to determine whether an innovation is worthy of a patent monopoly.

[IPBiz: 17 years?]


http://www.scotusblog.com/movabletype/archives/2007/05/ksr_and_asset_v.html#more

--First, even under KSR, it remains very difficult to challenge a patent’s validity in general—not only on obviousness grounds. The presumption of patent validity in litigation is untouched. And very few patents are litigated.

--Second for pharma/biotech (where patents are fewer, less acquired for purely defensive portfolies, and arguably ought not to be devalued) the fact pattern in KSR is so different and the technology so comparatively simple that its appeal to “common sense” just won’t be seen to have much application for much more complicated tech. Especially since these are core science fields where advances are quite likely to be much more driven by formal publication and where the Court’s admonition to be more flexible because in some fields the obvious is not written down (software, finance) does not so much apply.

--Third Insofar as KSR does depress the value of any intangibles, it should be viewed as a market correction. The Federal Circuit has not had enough feedback from either the Supreme Court or from other Circuits to strengthen its thinking on this point before now, and the PTO is a hopeless mess.

--Fourth the mess at the PTO and the problems at the Federal Circuit are so well known that it is hard to argue that markets would not have anticipated the risk of this sort of legal change, or much more radical efforts at reform.

--Fifth, if this ruling puts the patent system back on the road to credibility, over time it will *improve* the value of patents that will be seen to pass the test, and patents that pass through more stringent procedures. There will be a lot less uncertainty because of the perception of widespread low-quality patents. Auctions and other more precise market valuation mechanisms can move forward.

--Sixth outside of pharma/biotech, such as in tech, where patents are acquired in vast numbers for defensive portfolios, their "value" as individual valid assets that could actually be asserted all the way through a lawsuit is pretty questionable to begin with... and their value for sheer noise/confusion/deterrent effect is unimpaired. These patent portfolios are like the yellow and black pattern on the back of a wasp--harmless in itself, but a warning that the bearer *can sting.

IPBiz: recall what tech area Deuel was in. Note "obvious to try with a reasonable expectation of success" was established In re O'Farrell, 853 F.2d 894 (Fed. Cir. 1988) and the CAFC in KSR cited In re Deuel, 51 F.3d 1552 (Fed. Cir. 1995) for the proposition.

For those that don't remember Deuel:

Inventors applied for patent for deoxyribonucleic acid (DNA) and complementary DNA (cDNA) molecules encoding proteins that stimulated cell division. After patent examiner rejected claims as unpatentable on grounds of obviousness and the Patent and Trademark Office Board of Patent Appeals and Interferences affirmed, inventors appealed. The Court of Appeals, Lourie, Circuit Judge, held that: (1) combination of prior art reference teaching method of gene cloning, together with reference disclosing partial amino acid sequence for a protein that stimulated cell division, did not render claims prima facie obvious; (2) conceived method of preparing some unidentified DNA does not define it with precision necessary to render it obvious over protein it encodes; and (3) patent claims generically encompassing all DNA sequences encoding human and bovine proteins to stimulate cell division were not invalid as obvious.

Within Deuel, one finds:

In all of these cases, however, the prior art teaches a specific, structurally-definable compound and the question becomes whether the prior art would have suggested making the specific molecular modifications necessary to achieve the claimed invention. See In re Jones, 958 F.2d 347, 351, 21 USPQ2d 1941, 1944 (Fed.Cir.1992); In re Dillon, 919 F.2d 688, 692, 16 USPQ2d 1897, 1901 (Fed.Cir.1990) (en banc) ("structural similarity between claimed and prior art subject matter, ... where the prior art gives reason or motivation to make the claimed compositions, creates a prima facie case of obviousness"), cert. denied, 500 U.S. 904, 111 S.Ct. 1682, 114 L.Ed.2d 77 (1991); In re Grabiak, 769 F.2d 729, 731-32, 226 USPQ 870, 872 (Fed.Cir.1985) ("[I]n the case before us there must be adequate support in the prior art for the [prior art] ester/[claimed] thioester change in structure, in order to complete the PTO's prima facie case and shift the burden of going forward to the applicant."); In re Lalu, 747 F.2d 703, 705, 223 USPQ 1257, 1258 (Fed.Cir.1984) ("The prior art must provide one of ordinary skill in the art the motivation to make the proposed molecular modifications needed to arrive at the claimed compound.").

Note also footnote 1:

For a more extensive discussion of recombinant DNA technology, see In re O'Farrell, 853 F.2d 894, 895-99, 7 USPQ2d 1673, 1674-77 (Fed.Cir.1988);

IPBiz notes that the statement Second for pharma/biotech (where patents are fewer, less acquired for purely defensive portfolies, and arguably ought not to be devalued) the fact pattern in KSR is so different and the technology so comparatively simple that its appeal to “common sense” just won’t be seen to have much application for much more complicated tech. would seem NOT to comprehend the citation within the CAFC KSR case to Deuel AND the significance of the Supreme Court blowing away the rule within Deuel (and O'Farrell) about "obvious to try" NOT being the standard.