Patent Case Summaries January 6, 2021

Patent Case Summaries | Week Ending January 1, 2021

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.

General Electric Co. v. Raytheon Technologies Corp., No. 2019-1319 (Fed. Cir. (PTAB) Dec. 23, 2020). Opinion by Hughes, joined by Lourie and Reyna.

GE filed an IPR petition challenging certain claims of a Raytheon patent as being obvious over two prior art publications called “Wendus” and “Moxon.” The challenged patent claims are directed to methods of designing a two-stage gas turbine engine. The Patent Trial and Appeal Board ruled that the claims were nonobvious because Wendus teaches away from using a two-stage high pressure turbine and because GE did not establish a motivation to modify Wendus to incorporate the two-stage design of Moxon. GE appealed.

Raytheon moved to dismiss the appeal for lack of standing, arguing that Raytheon had never sued or threatened to sue GE for infringement and that GE never identified an engine that presented a substantial risk of infringing the patent. The Federal Circuit rejected Raytheon’s argument, stating that “activities that ‘will likely’—but might not—occur in the future can be sufficient to confer standing.” Here, GE had made investments in developing a geared turbofan engine and had informally offered the engine in an ongoing bidding process, which the court ruled “together establish that GE will likely engage in the sale of this geared turbofan engine design to customers.” GE also established that such a sale would raise a substantial risk of an infringement suit. Therefore, GE had standing to appeal.

On the merits, the Federal Circuit vacated and remanded the Board’s nonobviousness ruling as not supported by substantial evidence. First, the Federal Circuit determined that Wendus “at most suggest[s] a general preference for a one-stage high pressure turbine”; it “does not criticize, credit, or discourage the use of a two-stage high pressure turbine” as the Board believed. Next, the Federal Circuit ruled that the Board lacked substantial evidence for its conclusion that GE did not establish a motivation to combine Wendus and Moxon. “An artisan seeking to improve upon or otherwise modify the Wendus advanced engine would have tried to implement a two-stage high-pressure turbine because of the known advantages provided by a two-stage design.”

Finally, the court ruled that the Board lacked substantial evidence for its ruling that GE did not establish obviousness of the claims “as a whole.” The Board misunderstood the requirement to show obviousness of the claims as a whole, since “the Board’s approach would require a motivation to combine each element of the claim—even those present together in a reference.” Wendus disclosed all claimed elements except for the two-stage high-pressure turbine, which Moxon disclosed. The Federal Circuit ruled that “[i]t does not matter that GE did not explain why an artisan would be motivated to use each element disclosed in Wendus. That Wendus treats the claim parameters as desirable is enough motivation for an artisan to combine them with a two-stage turbine, as long as the artisan can make the combination with a reasonable expectation of success.”

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Simio, LLC v. FlexSim Software Products, Inc., No. 2020-1171 (Fed. Cir. (D. Utah) Dec. 29, 2020). Opinion by Prost, joined by Clevenger and Stoll.

Simio sued FlexSim for infringement of a patent relating to object-oriented simulations. The described invention sought to make object-oriented simulation easier and more accessible by letting users build simulations with graphics instead of needing to write programming code. FlexSim moved to dismiss the complaint for failure to state a claim upon which relief could be granted, arguing that the asserted claims were ineligible for patenting under 35 U.S.C. § 101.

In response, Simio moved for leave to file an amended complaint. The district court denied the motion and held the claims ineligible under § 101. The court concluded that the claims are directed to an abstract idea, namely, “the decades-old computer programming practice of substituting text-based coding with graphical processing.” The district court also ruled that FlexSim met its burden of showing no inventive concept or alteration of computer functionality sufficient to transform the system into a patent-eligible application.

The Federal Circuit affirmed. Simio stressed that the executable-process limitation is novel. But the Federal Circuit explained that this would not matter. The court stated that, “[e]ven assuming that is true, it does not avoid the problem of abstractness.” “A claim for a new abstract idea is still an abstract idea.” And here, the court held, “that’s really what we have: a claim directed to the idea of using graphics instead of programming to create object-oriented simulations—maybe a new idea, but still an abstract one—and lacking any inventive concept, any meaningful application of this idea, sufficient to save the claim’s eligibility.”

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