Ronny Valdes

On September 24, 2013, the United States Court of Appeals for the Federal Circuit affirmed-in-part, vacated-in-part, and remanded a decision of the Board of Patent Appeals & Interferences (BPAI),[1] on U.S. Patent No. 6,260,097 (ʼ097 patent), regarding claim construction and obviousness of the patent.^[2]  The Federal Circuit notably clarified the process the BPAI must follow to make determinations of invalidity based on obviousness. In Rambus, the Federal Circuit expanded its scope of de novo review by adjudicating on the substantive issues of a BPAI decision without deference after finding procedural error. The court additionally clarified the role of secondary considerations of non-obviousness when reviewing actions for patent invalidity. As a result, Rambus substantiates the Federal Circuit’s role as the longstanding defender of patents.

The ʼ097 patent claimed a method of controlling a synchronous memory device to help circuits transfer data faster by using a rising and falling clock signal to separate data into pieces and spread out the transfer.^[3]  The purpose of this new data separation during transfer is to avoid a “bottleneck” of data during the transfer.^[4]  Rambus, Inc. is the original assignee of the ʼ097 patent and has been labeled as one of the 8 most fearsome “patent trolls” by Business Insider.^[5]  Following a reexamination of the ʼ097 patent initiated by the United States Patent and Trademark Office (PTO), the BPAI upheld the patent examiner’s rejection of claims 1, 2, 7, 8, 10 and 14 as anticipated and claims 1-5, 7, 8, 10-12, 14, 26, 28-32 and 35 for obviousness.^[6]  Patent claims distinctly number in technical terms the subject matter the inventor is trying to patent.^[7]  Anticipation of claims is when the PTO decides a claim within the patent already exists in the prior art, meaning it fails the novelty test of patentability and is therefore invalid.^[8]

Rambus raised two primary issues in its appeal to the Federal Circuit.  First, Rambus claimed the BPAI erred in construing the terms “write request” and “external clock signal” leading to improper invalidation of claims due to anticipation.^[9]   Second, Rambus challenged the BPAI’s determination that a number of claims were obvious because the BPAI placed the burden of demonstrating non-obviousness on Rambus, used a different standard for determination than the patent examiner, and ignored the objective evidence of non-obviousness Rambus presented.^[10]  The Federal Circuit quickly resolved the claim construction issue against Rambus ^[11] and it quickly turned to the key point of contention in Rambus, the obviousness of the patent claims.

“Obviousness” precludes inventors from receiving a patent when the differences between the claimed invention and the prior art are so small that the invention as a whole would have been obvious to anyone of ordinary skill in the art prior to the filing date.^[12]  Typically, a patent examiner carries the burden of proving the invalidity of a patent claim by analyzing and comparing the claims to prior art in the field.^[13]  Additionally, when the BPAI reexamines an issued patent, it is limited to using the findings of the patent examiner in the initial prosecution even when those findings are flawed.^[14]

In Rambus, the Federal Circuit held that the BPAI erred in three areas when making its obviousness determination.^[15]  First, the BPAI erred by placing the burden on Rambus to prove non-obviousness because the burden of proving non-obviousness lies with the examiner.^[16]  Second, the Federal Circuit held that the BPAI exceeded the scope of its review role by relying on facts not raised to the applicant by the examiner.^[17]  Finally, the Federal Circuit held the BPAI’s requirement for establishing a nexus between the objective evidence of non-obviousness presented by Rambus and the merits of the claimed invention was too strict because the objective evidence must only be reasonably commensurate with the extent of the claims in the patent.^[18]

This case warns the BPAI that it has limits in making determinations of invalidity based on non-obviousness and cannot go beyond those limits.  For patent holders, this decision is encouraging because it emphasizes to quasi-judicial entities like the BPAI and lower courts that determinations of invalidity on substantive issues tied to procedural requirements are likely to receive little deference from the Federal Circuit.^[19]  Therefore, patent defense may be easier in the long run because the Federal Circuit has made it clear that the procedural requirements of patent appeals are not to be taken lightly. It also demonstrated a willingness to quickly overturn the BPAI when it goes beyond its scope of authority.^[20]

The Federal Circuit’s obviousness determinations continued to expand the gulf between the Federal Circuit and the PTO’s quasi-judicial entities.  Rambus admonishes the PTO and district courts who make invalidity determinations that interpretation of objective evidence of non-obviousness is required in every invalidity inquiry and must receive due weight. ^[21]  As the BPAI’s backlog of ex parte appeals continues to grow, and the output of decisions does not increase, the Federal Circuit emphasized that the BPAI must correctly apply the required standards in reexaminations for obviousness in the decisions it is issuing.^[22]

Overall, it will be interesting to analyze the future relationship between the BPAI and Federal Circuit as the BPAI continues to seek more deference from Article III courts and the patent field continues its exponential growth from the last decade.^[23]  Had the Federal Circuit affirmed the actions of the BPAI or granted deference to their substantive determinations, it would have allowed the BPAI to unilaterally change the standards for evaluating obviousness by ignoring or deemphasizing the determinations made by patent examiners.  However, the Federal Circuit is generally wary of granting deference to the BPAI, and this case continues the trend of the Federal Circuit serving as the “protector” and “standard bearer” of the patent system.[24]