Thursday, May 10, 2007

Looking backward, to the KSR brief and to 1883

Petitioner KSR, in its brief to the US Supreme Court, wrote: The present litigation, soon to begin its fifth year, well illustrates how the Federal Circuit "teaching-suggestion-motivation test" has gutted 35 U.S.C.
103(a) as a meaningful defense to claims for alleged patent infringement, and has permitted "a class of speculative schemers ... to lay a heavy tax upon the industry of the country, without contributing anything to the real advancement of the art." Atlantic Works v. Brady, 107 U.S. 192, 200 (1883). IPBiz notes the citation to an 1883 case suggests, contrary to theme of "Innovation and Its Discontents", indicates there is "nothing new" in the presence of "speculative schemers" in the patent system. IPBiz notes also text in LBE's "Looking Backward" in Intellectual Property Today, as well as text in Bellamy's "Looking Backward."

KSR's brief never cited In re Kotzab, 217 F.3d 1365, or Ruiz v. Chance, 234 F.3d 654, even though these two cases set forth the law on which the non-precedential Teleflex v. KSR, 2005 U.S. App. LEXIS 176, relied.

Of the arguments that later crystallized at the Supreme Court, KSR contended at district court that the undisputed prior art rendered claim 4 invalid even if evaluated under the Federal Circuit teaching-suggestion-motivation test. Teleflex argued that the TSM test required Teleflex to prove as a "fact "
(JA 133a (emphasis in original)), by "clear and convincing evidence"
(JA 127a), [FN10] that a hypothetical "person having ordinary skill in the
art," *11 35 U.S.C.
103(a), "confronted with the same problems as
the inventor and with no knowledge of the claimed invention, would select
the elements from the cited prior art references for combination in the
manner claimed" (JA 134a (quoting In re Rouffet, 149 F.3d 1350, 1357 (Fed.
Cir. 1998) ).) [IPBiz notes that KSR, who had the burden of proof, would have had the opportunity to find TSM through ANY of the means provided in Ruiz v. Chance, not JUST the "same problems as the inventor" approach. This "confusion" about "who" had to prove "what" goes "from" the KSR brief right into the Supreme Court opinion. It also infects some of the post-Supreme Court commentary. KSR, as the patent challenger, had the burden to show obviousness, and KSR was at liberty to show TSM in any way permissible by then-CAFC precedent. Teleflex did NOT have the burden to show nonobviousness. Even if Teleflex invoked the "same problems as the inventor" approach, that did NOT limit KSR as to TSM, nor did it require the Supreme Court to create an additional way to show TSM.]

KSR's fundamental point is that the prior art Asano patent "teaches the structure and function of each of the claim 4 limitations, except those relating to an electronic pedal position sensor." OTHER prior art supplied examples of the one missing claim element. The CRUX of the district court decision was that the
District Court followed Federal Circuit precedent and made additional
determinations in an attempt to satisfy the Federal Circuit
teaching-suggestion-motivation test. Based on the undisputed prior art of record, the District Court determined that a person having ordinary skill in the art having knowledge of the prior art Asano pedal and the prior art position sensors "would be motivated to combine the two." Teleflex, 298 F. Supp. 2d at 594. In analyzing the Supreme Court decision in KSR, it is important to note AT LEAST THREE THINGS:

#1. The Supreme Court in KSR declined KSR's invitation to apply the Supreme
Court's long-established "test of validity of combination patents,"
Sakraida, 425 U.S. at 282 (quoting Anderson's-Black Rock, 396 U.S. at 60). If, hypothetically, the TSM test were abolished, then the KSR court might have accepted KSR's invitation.

#2. The Supreme Court did not say that KSR had fulfilled the "same problems as the inventor" test of TSM, so it did not negate the CAFC's finding that KSR did not fulfill the "same problems as the inventor" test.

#3. The Supreme Court DID SAY that there was a way to fulfill TSM other than the "same problems as the inventor" test AND that KSR did meet that criterion. This is the point of harshest criticism BY the Supreme Court OF the CAFC.

**Of the CAFC decision, KSR wrote: The Federal Circuit declined to acknowledge the existence of, to follow, or to distinguish Sakraida or any other of this Court's precedents applying the "test of validity of combination patents." Sakraida, 425 U.S. at 282 (quoting Anderson's-Black, 396 U.S. at 60). The Federal Circuit also elected not to publish its decision even though it was vacating a comprehensive
reported decision by the District Court.

IPBiz notes, as it has noted many times before, that it is sometimes what isn't said that is most important. In the KSR decision of the Supreme Court, the Supreme Court declined to follow the Sakraida test in THIS combination patent case. The Supreme Court's approach was to make it easier to show TSM, rather than to use a test which had NO TSM. This "omission" is significant.

KSR wrote: And, applying the purportedly "correct" [TSM] test, the
Federal Circuit held that the undisputed prior art of record not only
did not support the District Court's grant of summary judgment to
Petitioner, but that the undisputed prior art purportedly did not make out even "a
prima facie case of obviousness."
IPBiz notes that the CAFC was reviewing the case as handed to it by the district court, which case included ONLY discussion of the "same problems as the inventor" portion of TSM. KSR was always free to argue OTHER bases for TSM, the presence of which were made clear by the CAFC citing Ruiz v. Chance, 234 F.3d 654, which the KSR brief neglected to cite. KSR did indicate the problem the CAFC had with the district court decision: the Federal Circuit remanded for determination "whether a person of ordinary skill in the art would have been motivated, at the time the invention was made, to attach an electronic control to the support structure of the pedal assembly disclosed by the Asano patent."
In this case, it was the Supreme Court that responded in the affirmative.

A part of the KSR argument which resonated with the Supreme Court was:

The [TSM] test guts
103(a) as a meaningful defense to liability for alleged patent infringement in many cases. It all but precludes the use of summary judgment as a means of determining the ultimate question of patent validity under
103. And it effectively strips courts of their traditional authority to determine the validity of patent claims under
103 and transfers that authority to lay juries. The Federal Circuit has reinterpreted
103 as providing, not a "condition for patentability" (as its statutory title states, and as this Court has construed
103 as providing), but as a
condition for challenges to patentability that is very difficult for the PTO or an
alleged infringer to meet, and effectively forces the issuance and upholding of
patents even where, as in this case, claimed subject matter differs
from undisputed prior art in only trivial respects.

IPBiz notes that an argument that did NOT resonate involved citation analysis:

According to Shepard's Citations, majority opinions in the regional
circuits cited Sakraida at least fifty-nine (59) times in the approximately
six-year period between 1976 and 1982. Thus, Sakraida was being cited
approximately ten (10) times per year by the regional circuit courts. In the 24 years since its creation, Federal Circuit majority opinions have cited Sakraida only four (4) times, with the last citation in a majority opinion occurring now more than 16 years ago. Moreover, in none of those four cases does the Federal
Circuit apply the holding of Sakraida. Instead, the citations are typically
disapproving references to precedents relied on by district courts or
to arguments made by the party who would lose on appeal. [FN20] Citations
to Johnston and Anderson's-Black Rock show similar patterns. [FN21]

The KSR brief referred to various law review articles, and gave a detailed discussion of one review mentioning Mr. Dabney's Vornado case:

The divergence between the Federal Circuit's and this Court's
precedents is so extreme that one recent commentator made what can only be described
as an unusual observation following this Court's 2002 ruling in Holmes Group,
Inc. v. Vornado Air Circulation Sys., Inc., 535 U.S. 826 (2002). Holmes
Group restored regional circuit jurisdiction over certain cases involving
patent law counterclaims, and the commentator worried that the decision was likely
to generate new circuit conflicts because a regional circuit "may decide
that it is bound to follow [Supreme Court] pronouncements" on
even those that had been "flatly rejected" by the Federal Circuit. See
Elizabeth I. Rogers, The Phoenix Precedents: The Unexpected Rebirth of
Regional Circuit Jurisdiction Over Patent Appeals and the Need for a
Considered Congressional Response, 16 Harv. J. Law & Tech. 411, 459

Toward the end of the KSR brief, one has mention of In re Dembiczak, 175 F.3d 994; Lee, 277 F.3d 1338, is mentioned but not fully utilized as a poster child. Alexander Graham Bell, but not Meucci, is mentioned, and of course the Selden patent is brought up. [IPBiz notes that Henry Ford's attorney in the Selden matter, Benton Crisp, was made available to Glenn Curtiss to challenge the patent of the Wright Brothers. Thus, while the KSR brief mentions a historically bad patent (Selden's), it neglects to mention the criticism undergone by a historically good patent (that of the Wrights), and that the same attorney was used against both. Neither Deuel nor O'Farrell are mentioned in the KSR brief. The possible impact of an "obvious to try" standard on the Wright Brothers, Edison's light bulb, or Alexander Graham Bell is not mentioned in the KSR brief.]

John F. Duffy was a co-author of the KSR brief; wok by Duffy is cited in the brief, including John F. Duffy, Rethinking the Prospect Theory of Patents, 71 U. Chi. L. Rev. 439 (2004)

To go back to oral argument in KSR -->

JUSTICE KENNEDY: Well, would it be, would it be inadvisable for us to
say the motive test teaches us something important; it has a valuable place;
it's just not the exclusive test for what's obvious.

MR. DABNEY: Certainly.


JUSTICE KENNEDY: Do you agree that in that context it would serve a
valid purpose, i.e., can we -- that is to say, can we keep the motivation
test and then supplement it with other, with other means of, other ways of
showing obviousness?

MR. HUNGAR: Yes, Your Honor. We agree that teaching suggestion and
motivation are valid means of proving obviousness, valid considerations for the


JUSTICE BREYER: It doesn't have to go on top. It's just to say what
you've been saying, that what you're supposed to look to ultimately is whether
a person, as the statute says, who is familiar with the subject, of
ordinary skill in the art, whether to such a person this would have been
obvious. Now, there are many, and this Court has listed several, factors that might
count in favor of it not being obvious, such as people have been trying to
do it for a long time and they haven't been able to figure out how. That's a
good one, and there are some other ones here. If there's a teaching right
there, it seems to cut the other way.

But to hope to have a nonexclusive list seems to me a little bit like
Holmes trying to hope to have an exclusive list of what counts as negligence.
In the law we have many standards that you can get clues about, but you can't
absolutely define them, and why isn't this one of them?

IPBiz must include:

CHIEF JUSTICE ROBERTS: Who do you get to be an expert to tell you
something's not obvious.

MR. GOLDSTEIN: You get --

CHIEF JUSTICE ROBERTS: I mean, the least insightful person you can

IPBiz notes on the patent system is broken theme:

You can't take, in a system that produces so many patents, and say ah,
look at this side swing patent, or the garbage bags, and draw from that the
conclusion that the system is fundamentally broken.

Justice Breyer, I meant to come back to that. We can look through the
studies, we cite a series of empirical studies in our brief that have
looked at this problem, the rhetorical claim that the obviousness rule is
leading to gross over-patenting.

IPBiz notes, in terms of the test that the Supreme Court added:

MR. DABNEY: What the statute calls for, Justice Kennedy, is not to
focus on a particular subjective problem like fitting into a Ford F 350, or
particular difference between a prior art pedal that provides wire chafing and a
claimed invention. The law has always required that the patentability be
determined by the smallest amount of difference. So if it were true that there was
wire chafing, that that was a *60 problem that would have had to have been
overcome, if you started with a prior art pedal that, that provided for
wires to move -- well then, maybe that combination would not make the claimed
subject matter obvious.

***As an aside

The KSR brief might leave one with the impression that the Selden patent was declared invalid. Such is not the case.

It is true that one has the text at 184 F. at 901:

Even if the Brayton uses were not precisely anticipatory, we can reach no other conclusion than that with them in the prior art the claim in question must be held invalid for want of invention if it be given the broad construction the language apparently calls for. Moreover, if we give it a slightly narrower construction and treat it as covering the selection of the Brayton type of compression engine, the same conclusion must be reached. Invention would not be involved in the mere choice of that type of engine, for Brayton had previously made the same selection for his street car and boats. And, even if the Brayton engine had been used only for stationary purposes, it is by no means certain that its mere selection for incorporation in a motor vehicle without adaptation would have involved invention.

HOWEVER, one also has the text:

p. 902
But we are reluctant to so construe the claim that it must be held invalid for want of invention. We are of the opinion that the patentee had ideas ahead of the times and appreciated many aspects of the problem to be solved in creating a practical motor vehicle. Reading his statement of the difficulties encountered, his manner of meeting them, and the advantages of his discovery, we think it evident that he understood [**23] that an engine suitable for a light vehicle could not be taken bodily from the prior art and used without change, but that modification and adaptation were required. In our opinion the statement in the patent that any form of compression engine may be employed is inconsistent with the intention disclosed by the patentee in the patent as a whole and should not have too much stress laid upon it. We also think that we should examine the specification, including the drawings and the model, to determine whether the patentee in addition to expressing the need of adapting an engine to the purposes of a motor vehicle shows that he actually adapted one. It may well be that the claim is limited by the specification should be held to be valid.
p. 908
A patent is granted for solving a problem, not for stating one. Its description must explain the invention itself, the manner of making it, and the mode of putting it in practice. In the absence of knowledge upon these points, the invention is not available to the public without further experiments and further exercise of inventive skill. A claim for a combination which embraces an element only in case it is made capable of being employed in the combination and without disclosing means of adapting it discloses nothing definite. The questions remain: What engine is capable of being combined in a road vehicle? What changes are necessary to adapt it to the purpose? How are these changes to be made? If we were to construe the claim [p. 909] as the complainants urge, we should be obliged to go further and hold it uncertain, indefinite, and consequently invalid.

[But they didn't]

See also

L. B. Ebert, Looking Backward, IPT, p. 20, June, 2001-->
Of Columbia Motor Car Co. v. C. A. Duerr, 184 F. 893 (CA 2 1911):

The logic of the Columbia opinion is not difficult to understand, even by the standards of 2001. The Selden patent disclosed a constant pressure engine, in which one had slow combustion without explosion. In contrast, Ford (and others) employed a constant volume engine, in which the piston moves by explosive action. n5 184 F. at 904. The engine of Selden required a constantly burning flame. 184 F. at 905. Of the doctrine of equivalents, the court seemed to cabin the scope because of the non-pioneering nature of the invention ("The patent as so construed necessarily permits only a very limited range of equivalent forms." 184 F. at 911; "In giving weight to dissimilarities -- in saying what are substantial and what relate merely to form -- we must consider the degree of invention shown in the patent . . . " 184 F. at 912.) One seems to have the rudiments of the Graver Tank tri-partite test: "[no equivalents] because the two engines do not perform the same functions in substantially the same way." 184 F. at 915.

See also [which includes claim 4 of US 6,237,565]

The article On the Supreme Court decision in KSR v. Teleflex includes text from the CAFC decision in KSR that one will NOT find in the KSR brief.

Separately, from the law review of Duffy cited in the KSR brief:

While Kitch drew inspiration from property rights theory, this Article draws an analogy between the patent system and natural monopoly regulation. The analogy is apt because intellectual property is a special case of natural monopoly: The initial investment to create the good is large, but the marginal cost of providing the good for additional uses is negligible. In such cases, economic theory recommends that provision of the good by a single firm--that is, monopoly--is superior to provision by multiple firms, and in the regulation of both natural monopoly and intellectual property, the law has followed this [*510] recommendation. In both areas, the central policy question then becomes how to constrain the behavior of the monopolist so as to maximize social welfare.

The proposal made by Harold Demsetz in the context of natural monopoly regulation was to harness competition to constrain the monopolist and to maximize consumer welfare. Demsetz's proposal describes the reality of the patent system. A patent race is not only a rivalry to invent first, but also a rivalry to have the patent expire soonest. The rivalry is accentuated by the patent system's willingness to grant exclusive rights relatively early in technical development, for that feature of the system ensures that patent rents are dissipated primarily through the earlier termination of the rights.

This view accounts for features of the patent system left unexplained by the prospect theory. In particular, it explains why a policy favoring the early grant of patent rights has value even if rivalry to obtain patents remains ubiquitous, and it explains why the system continues the competition for patents even within the claims of already issued patents. The approach also provides new insight into deciding the optimal limits of patent term and patent scope, and into other major issues in patent law.

The patent system can best be understood in reference to the theories and policies undergirding property, competition, and natural monopoly regulation. Kitch stressed the relationship between the first two--in particular, the desirability of granting property rights to end rivalry. The modest goal of this Article is to explain the interrelation of the last two and, in particular, the desirability of accentuating rivalry to constrain monopoly.


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