By Dennis Crouch
Zoltek Corp. v. US (Fed. Cir. 2016)
The interesting and long-running Zoltek case has received another decision from the Federal Circuit – this time reversing the Court of Federal Claims ruling that Zoltek’s stealthy patent claims are invalid.
Zoltek is the owner of US Reissue Patent No. Re 34,162 issued January 19, 1993. In 1996, Zoltek sued the U.S. government for infringing the patent – in particular, the patentee argued that the B-2 Bomber and F-22 Fighter both used carbon fiber sheets that infringed the patent rights.
As a starting point for most claims against a government is with sovereign immunity. The U.S. Government claims sovereign immunity against suits except where waived. In the patent context, the U.S. government has waived its immunity, but limits the procedure and form of recovery. In particular, 28 U.S.C. § 1498(a) provides that “the owner’s remedy shall be by action against the United States in the United States Court of Federal Claims for the recovery of his reasonable and entire compensation for such use and manufacture.” The statute also provides cover for contractors or other non-government-entities who infringe the patent “with the authorization or consent of the Government” so that those actions must also be pursued against the U.S. Government. The Court of Federal Claims is located in the same Madison Place building as the Court of Appeals for the Federal Circuit.
In its prior en banc decision from the case, the Federal Circuit ruled that Section 1498(a)’s infringement statute should be broadly read to encompass Section 271(g) infringement.
Following that decision, the Court of Federal Claims held a trial on validity and found that the asserted claims were invalid as obvious and/or lacking written description. The court has reversed that holding and remanded.
Omitted Elements: During reissue prosecution of the manufacturing process claims, the applicant deleted the initial step of “oxidizing and stabilizing the carbonizable fiber starting material at an elevated temperature.” That deletion clearly broadened the patent claim – however, a broadening reissue was proper because it had been filed within two years of the grant of the original patent. The CFC found, however, that the new breadth went beyond the original written description and thus rendered the claim invalid – holding that “the preparation of the known starting material must be included in the claim” even if known in the prior art. On appeal, the US Government argued for affimance since “the specification does not state that these steps need not be performed by the same entity.”
On appeal, the Federal Circuit completely rejected this analysis: “The question of who performs steps of a fully described invention, including preparation of a known starting material, is not a matter of the written description requirement.”
The original specification plainly, and without dispute, describes that the starting material is an oxidized and stabilized fiber, cites references showing this known material, and describes its preparation. That a previously oxidized and stabilized starting material was known to a person of ordinary skill in the field was recognized [as well] . . . . The question of who performs steps of a fully described invention, including preparation of a known starting material, is not a matter of the written description requirement.
The purpose of the written description requirement is to assure that the public receives sufficient knowledge of the patented technology, and to demonstrate that the patentee is in possession of the invention claimed. . . . The written description need not include information that is already known and available to the experienced public. . . .
The CFC stated its concern that the reissue patent claims could be infringed by an entity that did not itself make the starting material, but purchased the known starting material from a commercial source. . . . A validly obtained reissue does not violate the written description requirement if the patentee can reach an enlarged scope of possible infringement. It is not an improper broadening amendment when a reissue applicant, with the considered agreement of the reissue Examiner, substitutes a preparatory step known to those skilled in the art at the time of the invention with a requirement to start with the product of that known preparatory step. The CFC’s emphasis on who might infringe the broadened reissue claims is an issue of infringement, not written description. We conclude that the CFC erred in holding reissue claims 1–22 and 33–38 invalid for failure to meet the written description requirement of section 112. That ruling is reversed.
The issue here is definitely interesting – in particular, I see the question of whether the starting-material is available as prior art to be a total red-herring since its manufacture was sufficiently described in the specification. The question is whether the patentee described an invention that began by “obtaining” rather than “making” the starting material. The Federal Circuit didn’t really answer that question. I will note that none of the parties cited Gentry Gallery, Inc. v. Berkline Corp., 134 F.3d 1473 (Fed. Cir. 1998) ([not announcing] an omitted essential elements test).
On Obviousness, the Federal Circuit took the government to task as well – finding substantial errors in the Government’s expert testimony and noting the admitted novelty of the fiber sheets created by the inventors. “Instead, the government’s argument appears to be that since [its expert] Dr. Sullivan is a renowned scientist in this field, and since Dr. Sullivan was able to reproduce the Figure 4 graph, it was obvious to do so. This was error.”
Section 101 – The government had also argued that the patented “method of manufacturing . . . carbon fiber sheets” lacked subject matter eligibility under Section 101 as effectively claiming a law of nature. From the CFC Decision rejecting the eligibility argument:
The Government argues that the claims are invalid because they embody nothing more than a law of nature. For example, the Government points to Figure 4 of the patent to support its contention. It argues that Figure 4, which charts a relationship between heat treatment temperature and surface resistance, demonstrates the ineligibility of the ‘162 Patent claims by showing that the claims embody nothing more than a natural law that links temperature to resistance. Relying upon the testimony of its expert, Dr. Brian Sullivan, the Government argues that the independent claims at issue (claims 1 and 33) consist of three parts: (1) the manufacture of carbon fibers using conventional carbonization equipment and techniques; (2) the manufacture of a sheet product using conventional techniques and processes; and (3) “the concept that if you control the fibers’ volume electrical resistivity it gives you the ability to control the sheet or surface resistivity of the final carbon mat productThe Government argues that these three parts render the ‘162 Patent’s claims similar to those found ineligible in Flook and Mayo. . . . The Court agrees with Zoltek [and disagrees with the Government]. The Government’s comparisons to the ineligible claims in Flook and Mayo are much less apt than comparison to Diehr.
The CFC did reject that argument and the Government did not appeal that issue.
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 The ‘162 Reissue Patent originally issued in 1988 as U.S. Patent No. 4,728,395 and then reissued in 1993. Zoltek obtained the patent rights when it bought Stackpole Fibers in 1988.
 See Uniroyal, Inc. v. Rudkin-Wiley Corp., 837 F.2d 1044, 1051 (Fed. Cir. 1988) (“[t]hat which may be made clear and thus ‘obvious’ to a court, with the invention fully diagrammed and aided . . . by experts in the field, may have been a break-through of substantial dimension when first unveiled.”); see also KSR (“A factfinder should be aware, of course, of the distortion caused by hindsight bias and must be cautious of arguments reliant upon ex post reasoning”); W.L. Gore, 721 F.2d at 1553 (“It is difficult but necessary that the decisionmaker forget what he or she has been taught at trial about the claimed invention and cast the mind back to the time the invention was made (often as here many years), to occupy the mind of one skilled in the art who is presented only with the references, and who is normally guided by the then-accepted wisdom in the art.”).