Patent Case Summaries June 30, 2020

Patent Case Summaries | Week Ending June 26, 2020

A weekly summary of the precedential patent-related opinions issued by the Court of Appeals for the Federal Circuit and the opinions designated precedential or informative by the Patent Trial and Appeal Board.

Shoes by Firebug LLC v. Stride Rite Children’s Group, LLC, Nos. 2019-1622, -1623 (Fed. Cir. (PTAB) June 25, 2020). Opinion by Lourie, joined by Moore and O’Malley.

Stride Rite filed two IPR petitions challenging patents owned by Firebug related to illumination systems for footwear. In both IPRs, the Patent Trial and Appeal Board ruled that the preambles of the independent claims are not limiting and that the challenged claims are unpatentable as obvious over the prior art. Firebug appealed, presenting two arguments.

First, Firebug argued that the Board erred in determining that the preambles, which recite an “internally illuminated textile footwear,” do not limit the claims. The Federal Circuit disagreed with Firebug as to one of the patents but agreed as to the other. Regarding the former, the Federal Circuit explained that the preamble is not limiting because the body of the claim “recites a structurally complete invention, and therefore the preamble’s recitation . . . is merely an intended purpose that does not limit the claims.” Regarding the latter, the court agreed with Firebug that the preamble is limiting because the body of the claim “relies on the instance of ‘footwear’ introduced in the preamble for ‘antecedent basis.’” However, the Federal Circuit ruled that the Board’s error was harmless because its alternative finding “that the references disclose the use of textile footwear” was supported by substantial evidence.

Second, Firebug argued that the challenged claims would not have been obvious due to Firebug’s evidence of secondary considerations of nonobviousness. Firebug argued that two license agreements coupled with testimony of the person who negotiated the licenses establish a nexus between Firebug’s products and the challenged claims. The Federal Circuit noted, however, that the licenses include rights beyond the challenged patents, and therefore “the agreements on their face do not establish a nexus.” The court ultimately ruled that it did not need to determine whether the Board erred in finding no nexus “because the Board alternatively found that, even if nexus is presumed, Firebug’s evidence of secondary considerations is weak, and that conclusion is supported by substantial evidence.” The Federal Circuit therefore affirmed.

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Adidas AG v. Nike, Inc., Nos. 2019-1787, -1788 (Fed. Cir. (PTAB) June 25, 2020). Opinion by Moore, joined by Taranto and Chen.

Adidas initiated IPR proceedings challenging certain claims of two Nike patents directed to methods of manufacturing an article of footwear with a textile upper. The Patent Trial and Appeal Board held that Adidas had not demonstrated that the claims were unpatentable as obvious.

On appeal, the Federal Circuit first rejected Nike’s argument that Adidas did not have standing to appeal. Nike argued that Adidas could not establish an “injury in fact” because Nike “has not sued or threatened to sue Adidas for infringement” of either patent. The Federal Circuit disagreed, explaining that to establish “injury” in appealing a final written decision, an appellant “need not face a specific threat of infringement litigation.” Instead, “it is generally sufficient for the appellant to show that it has engaged in, is engaging in, or will likely engage in activity that would give rise to a possible infringement suit.”

On the merits, Adidas had presented two grounds of obviousness: the combination of “Reed” and “Nishida” (Ground 1) and the combination of Nishida, “Castello,” and “Fujiwara” (Ground 2). The Board found no motivation to combine the references. Regarding Ground 1, the Board explained that the combination of Reed and Nishida would “require the alteration of the principles of operation of Reed or would render Reed inoperable for its intended purpose.” Regarding Ground 2, the Board found that the references used “different seaming techniques” such that “modifying Castello in view of Fujiwara would change the principles under which Castello operates.”

The Federal Circuit affirmed the Board’s ruling as to both Grounds. The court explained that the obviousness inquiry “does not merely ask whether a skilled artisan could combine the references, but instead asks whether they would have been motivated to do so.” Here, the Board properly considered the “fundamental differences” in the techniques employed in the cited references. Thus, the Board’s motivation to combine findings were supported by substantial evidence.

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B/E Aerospace, Inc. v. C&D Zodiac, Inc., Nos. 2019-1935, -1936 (Fed. Cir. (PTAB) June 26, 2020). Opinion by Reyna, joined by Lourie and Hughes.

In an IPR proceeding, the Patent Trial and Appeal Board found certain claims of two B/E Aerospace patents obvious. The patents relate to space-saving technologies for aircraft enclosures such as lavatories, closets, and galleys. The patents are directed to space-saving modifications to the walls of these enclosures. The representative claim requires a “first recess” and a “second recess” of a forward wall portion of the enclosure. The Board concluded that the challenged claims would have been obvious over the “Admitted Prior Art” and “Betts,” finding that Betts disclosed the “first recess” and that it would have been obvious to further modify the combined references to include the “second recess.”

On appeal, Zodiac argued that the Board’s obviousness determination was erroneous because it improperly incorporated a second recess limitation not disclosed in the prior art. The Federal Circuit disagreed with Zodiac and affirmed the obviousness determination. The court explained that there was no dispute that Betts taught the “first recess” limitation or that a skilled artisan would have been motivated to modify the Admitted Prior Art with Betts’s contoured wall. Addressing the “second recess” limitation, the court found no error in the Board’s conclusion that “it would have been obvious to modify the Admitted Prior Art/Betts combination to include the claimed ‘second recess.’” The Federal Circuit stated that the modification “was nothing more than the predictable application of known technology.” Also, the challenged claims would have been obvious because “it would have been a matter of common sense to incorporate a second recess in the Admitted Prior Art/Betts combination.”

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