Saturday, September 09, 2017

Southwire wins a legal point on inherency but otherwise loses at the CAFC

Southwire lost at the CAFC on an appeal of an inter partes re-exam decision:

Southwire Co. (“Southwire”) appeals from the decision of the U.S. Patent and Trademark Office (“the PTO”) Patent Trial and Appeal Board (“the Board”) in an inter partes reexamination concluding that claims 1–42 of U.S. Patent 7,557,301 (“the ’301 patent”) are unpatentable under 35 U.S.C. § 103. See Cerro Wire, Inc. v. Southwire Co., No. 2015-004351, 2015 Pat. App. LEXIS 10285 (P.T.A.B. Sept. 29, 2015) (“Final Decision”); Cerro Wire, Inc. v. Southwire Co., No. 2015-004351, 2016 Pat. App. LEXIS 1942 (P.T.A.B. May 2, 2016) (decision on request for rehearing). For the reasons that follow, we affirm.

Of inherency in obviousness:

Southwire argues that, as an initial matter, the Board erred in relying on “inherency” in making its obviousness determination. Second, Southwire argues that Summers does not inherently teach the “at least about a 30% reduction” in pulling force limitation because a limitation is not inherent in a reference unless it is necessarily, i.e., always, present. Thus, Southwire argues, the Board’s finding that a “skilled artisan would have had reason to select [lubricant] concentrations that did” achieve the 30% reduction in pulling force is the antithesis of inherency, which requires certainty, not experimentation. Final Decision, 2015 Pat. App. LEXIS 10285, at *21

The CAFC noted:

First, we agree with Southwire that the Board erred in relying on inherency in making its obviousness determination. We have held that “the use of inherency in the context of obviousness must be carefully circumscribed because ‘[t]hat which may be inherent is not necessarily known’ and that which is unknown cannot be obvious.” Honeywell Int’l v. Mexichem Amanco Holding S.A., No. 2016-1996, —F.3d—, 2017 WL 3254943, at *10 (Fed. Cir. Aug. 1, 2017) (quoting In re Rijckaert, 9 F.3d 1531, 1534 (Fed. Cir. 1993)). While “[w]e have recognized that inherency may supply a missing claim limitation in an obviousness analysis,” PAR Pharm., Inc. v. TWI Pharm., Inc., 773 F.3d 1186, 1194–95 (Fed. Cir. 2014) (collecting cases), we have emphasized that “the limitation at issue necessarily must be present” in order to be inherently disclosed by the reference, id. (emphasis added). The Board cited no evidence that a reduction of 30% in the pulling force would necessarily result from the claimed process, which contains no steps that ensure such reduction.


However, we also conclude that the Board’s error was harmless because, although it improperly invoked inherency, it need not have. It made the necessary underlying factual findings to support an obviousness determination. It found that the claimed method simply applies the same process for the same purpose as disclosed in Summers— i.e., to reduce the pulling force on a cable for ease of installation. See, e.g., J.A. 169

YES, In re Best arose:

... except for the functionally expressed [limitation at issue],” the PTO can require an applicant “to prove that the subject matter shown to be in the prior art does not possess the characteristic relied on.” In re Best, 562 F.2d 1252, 1254–55 (CCPA 1977) (emphases added) (internal quotation marks omitted). The court noted that
“[w]hether the rejection is based on ‘inherency’ under 35 U.S.C. § 102, [or] on ‘prima facie obviousness’ under 35 U.S.C. § 103, . . . the burden of proof is the same.” Id.


In the absence of any evidence that the claimed 30% reduction would have been unexpected in light of the Summers disclosure, there is no indication that the limitation is anything other than mere quantification of the results of a known process.

Of In re Best, the CAFC had cited it previously [ 2012 U.S. App. LEXIS 7897 ] for the proposition:

The mere fact that a certain thing may result from a given set of circumstances is not sufficient." Therasense, 593 F.3d at 1332 (citing Cont'l Can Co. USA, Inc. v. Monsanto Co., 948 F.2d 1264, 1269 (Fed. Cir. 1991)). The Examiner has the burden of providing reasonable proof that a claim limitation is an inherent characteristic of the prior art. In re Best, 562 F.2d 1252, 1254-55 (C.C.P.A. 1977)

The Best case itself was about zeolites. Claim 3 contained a "functional" limitation:

cooling the steamed zeolite to a temperature below 350 degree C. at a rate sufficiently rapid that the cooled zeolite exhibits an X-ray powder diffraction pattern having the d-spacing corresponding to the Miller Indices, hkl, of 331 at least as strong in intensity as that corresponding to the Miller Indices 533, prior to any post-steaming ion exchange treatment.

The CCPA wrote:

Also with respect to Hansford, the examiner believed the cooling rate of the zeolite after stabilization to be within the [page 1254] terms of the appealed process claims. The claimed product being the unique result of the claimed process, the examiner, therefore, rejected both process and product claims as anticipated by Hansford, or, in any case, as obvious in view of Hansford.

In sustaining the rejection, the board added its view of Hansford.
All the positive process limitations are expressly disclosed except for the functionally expressed rate of cooling. However, there is nothing to indicate that this rate of cooling in any way differs from the normal rate resulting from removal of the heat source. Thus, the examiner's conclusion that those parameters of the resultant product which are recited in the appealed claims but are not expressly disclosed in the reference would be inherent is a reasonable one, absent convincing evidence to the contrary. Appellants have presented no such convincing evidence. No comparison has been made between appellants' process and product and the process and product disclosed in the Hansford patent. The comparative data contained in appellants' specification and in an affidavit under 37 CFR 1.132 do not relate to the reference but merely illustrate the result of deviating from appellants' process. Such deviations appear to be also outside the scope of the Hansford teaching.

But the "rub" in Best (and in Southwire) is how to compare when the reference is silent:

The appellants urge that, because Hansford is silent on appellants' crucial cool-down step and on his apparatus, a direct comparison between the claimed process and that of Hansford is impossible. Appellants correctly state that indirect comparisons, based on established scientific principles, can validly be applied to distinguish a claimed chemical process or product from that disclosed in the prior art. In re Blondel, 499 F.2d 1311, 182 USPQ 294 (CCPA 1974). However, our analysis of the comparative data offered by appellants convinces us that the burden of rebutting the PTO's reasonable assertion of inherency under 35 USC 102, or of prima facie obviousness under 35 USC 103, has not been met.
Our reading of Hansford leads us to conclude, as did the board, that all process limitations of claim 3 are expressly disclosed by Hansford, except for the functionally expressed rate of cooling. Because any sample of Hansford's calcined zeolitic catalyst would necessarily be cooled to facilitate subsequent handling, the conclusion of the examiner that such cooling is encompassed by the terms of the appealed claims was reasonable.

The CCPA further noted:

Additionally, where the Patent Office has reason to believe that a functional limitation asserted to be critical for establishing novelty in the claimed subject matter may, in fact, be [page 1255] an inherent characteristic of the prior art, it possesses the authority to require the applicant to prove that the subject matter shown to be in the prior art does not possess the characteristic relied on. [58 CCPA at 1031, 439 F.2d at 212-13, 169 USPQ at 229.]


In view of Hansford's silence on cool-down rate and on his apparatus, appellants need only have shown that the cool-down rate, for a typical laboratory-scale sample when employed in Hansford's process, would not yield a cooled zeolite with the X-ray diffraction pattern of claim 3. Appellants failed to do even that.


Where, as here, the claimed and prior art products are identical or substantially identical, or are produced by identical or substantially identical processes, the PTO can require an applicant to prove that the prior art products do not necessarily or inherently possess the characteristics of his claimed product. See In re Ludtke, supra. Whether the rejection is based on "inherency" under 35 USC 102, on "prima facie obviousness" under 35 USC 103, jointly or alternatively, 4 the burden of proof is the same, and its fairness is evidenced by the PTO's inability to manufacture products or to obtain and compare prior art products. See In re Brown, 59 CCPA 1036, 459 F.2d 531, 173 USPQ 685 (1972

562 F.2d 1252; 195 U.S.P.Q. 430 (CCPA 1977)

***Of the Best case, one notes that the functional limitation ("cooling rate") was defined in terms of x-ray diffraction parameters (" exhibits an X-ray powder diffraction pattern having the d-spacing corresponding to the Miller Indices, hkl, of 331 at least as strong in intensity as that corresponding to the Miller Indices 533 " ). The Hansford reference has no x-ray diffraction information, and defines the invention in the following way:

Briefly stated, the novel stabilizing treatment of the invention comprises a calcining step carried out preferably at above about 800 F. during which the partial pressure of water vapor is maintained at a level above about 0.4 p.s.-i.a. Following this hydrothermal stabilization treatment, the resulting zeolite can be contacted with water or Water vapor at substantially any temperature below about 1,200 F.-, without undergoing appreciable losses in surface area or crystallinity.

The first claim of Hansford:

A method for stabilizing the crystal structure of a hydrogen zeolite of the Y crystal type against hydrothermal degradation without substantial reduction in surface area thereof, said hydrogen zeolite being initially unstable and subject to loss of at least about 10% of its surface area and crystallinity when heated in its hydrated state at temperatures between 300 and 500 F. and containing less than about 3% by weight of Na O, at least about 40% of the ion-exchange capacity thereof being satisfied by hydrogen ions, which comprises subjecting said hydrogen zeolite to a hydrothermal stabilization treatment by heating the same at temperatures between about 700 and 1,200 F. in contact with a vapor phase comprising at least about 0.4, but not more than about 10, p.s.i.a. partial pressure of water vapor, there having been substantially no previous contacting of said hydrogen zeolite with water vapor of greater than about 2 p.s.i. partial pressure within the temperature range of about 300-500 F.


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