Tokai Corp. et al. v. Eastern Enterprises Int., Inc. et al.
Docket No. 2010-1057, -1116
January 31, 2011
NEWMAN (dissent), LOURIE, BRYSON
Tokai appealed DC SJ grant of invalidity of its patents related to safety utility lighters (as for grills) as obvious. Easton cross-appealed the DC claim construction and grant of Tokai’s motion to strike its supplemental invalidity arguments. Each of the asserted independent claims describes a “lighting rod” (i.e., a utility lighter) having a particular “safety device.” At the DC, Easton unsuccessfully attempted to introduce expert declarations countering the obviousness allegations, denied because the evidence was not properly submitted during discovery (and the FC panel agreed (“We have previously cautioned litigants of the ‘pitfalls of playing fast and loose with rules of discovery’”, citing Innogenetics, FC 2008)). The DC found no substantial questions of material fact after reviewing the Graham factors (except that the parties disagreed as to the level of skill in the art). Tokai argued that Easton should have been subject to “an enhanced burden to rebut the presumption of validity of the asserted claims, because some of the asserted prior art references were considered during prosecution of the asserted patents.” The FC agreed that an enhanced burden is present “if the invalidity argument relies on the same prior art considered during examination by the” USPTO (citing Power Oasis, FC 1984). But some of the art alleged by Easton to be invalidating was not considered during examination (so no added burden). Tokai also argued that the DC did not give proper weight to its evidence of commercial success and copying. The panel noted that “a nexus must exist between the commercial success and the claimed invention” (Ormco Corp., FC 2006; Richdel, Inc., FC 1983), and that Tokai could not show that nexus. The panel also found the evidence of copying unpersuasive (“requires evidence of efforts to replicate a specific product” (Wyers, FC 2010) and not just a stipulation of infringement (Iron Grip, FC 2004). Tokai also argued that there was no motivation to combine the cited references, and that making the claimed inventions therefrom would have required substantial modification of the art. The panel pointed to the specification for evidence that, as of the filing date, a need for the claimed invention was known (“a need exists for a lighting rod having enhanced safety characteristics” and that, “[t]o satisfy such a need, lighting rods provided with various safety devices have been proposed” in the prior art). And, courts “may find a motivation to combine prior art references in the nature of the problem to be solved…[which] is particularly relevant with simpler mechanical technologies” (citing Ruiz, FC 2004; Rothman, FC 2009; Pro-Mold, FC 1996). Thus, the DC holdings were affirmed.
Judge Newman’s dissent argued that “[t]he Tokai lighter has an ingenious safety design” and was not obvious. It was argued that the DC applied the incorrect standard, which is not “whether a person could, with full knowledge of the patented device, reproduce it from prior art or known principles” but “whether it would have been obvious, without knowledge of the patentee’s achievement, to produce the same thing that the patentee produced…without the benefit of hindsight” (citing Orhtopedic Equipment, FC 1983 (“Where, as here, the features of one reference cannot be substituted into the structure of a second reference, this weighs against obviousness”); In re Hummer, CCPA 1957 (incremental but unobvious improvements serve the public interest). The dissent also argued for the value of secondary considerations, citing Harries (2d Cir. 1950 (“the freshness of insight which observes a little, but fruitful, change which had theretofore escaped detection by those engaged in the field”)), Arkie Lures (FC 1997 (“‘secondary considerations’ provide evidence of how the patented device is viewed by the interested public… may be highly probative of the issue of nonob- viousness”)), and KSR (US 2007 (“[s]uch secondary considerations as commercial success, long felt but unsolved needs, failure of others, etc., might be utilized to give light to the circumstances surrounding the origin of the subject matter sought to be patented”), see also Ashland Oil, FC 1985)). Regarding the “nexus”, the dissent argued that application of the rule was too strict (“a prima facie case of nexus is generally made out when the patentee shows both that there is commercial success, and that the thing (product or method) that is commercially successful is the invention disclosed and claimed in the patent” (Demaco, FC 1988; see also Pro-Mold, FC 1996)).