Burden Shifting at the PTAB and the Obviousness of Ranges

2,5-Furandicarboxylic acid.pngby Dennis Crouch

The new DuPont v. Synvina decision is important for its specific application obviousness of claim ranges.  It also creates some amount of tension with prior cases — particularly Dynamic Drinkware and Magnum Oil – regarding burden shifting within Inter Partes Review proceedings.

E.I. DuPont de Nemours v. Synvina C.V. (Fed. Cir. 2018)

In its Inter Partes Review (IPR) final decision, the Board sided with the patentee — finding that DuPont hadn’t proven Synvina’s challenged chem-prep patent obvious. (Claims 1-5 and 7-9 of U.S. Patent 8,865,921.)  On appeal, the Federal Circuit has reversed — um actually, the claims are obvious.

Claim 1 is directed to a method of preparing FDCA — an organic compound known since 1876.  FDCA can be made from plant-sugars and then used to make plastic and other polymers.

The claim requires only one step — “contacting a feed . . . in the presence of an oxidation catalyst . . .  at a temperature between 140° C. and 200° C. [and] at an oxygen partial pressure of 1 to 10 bar.”   The claim particularly defines the “feed” (“a compound selected from the group consisting of [HMF], an ester of [HMF], [5MF], . . .  and a mixture of two or more of these compounds with an oxygen-containing gas” as well as the catalyst (“both Co and Mn, and further a source of bromine”) and indicates that the claimed contacting takes place in the presence of “acetic acid or acetic acid and water mixture”.

One-step methods were already known for preparing FDCA, but disclosed different temperature, pressures, solvents, and catalysts.  The closest identified prior art references are listed below as comparisons to the aforementioned claim 1.

In a number of prior cases, even pre-KSR, the Federal Circuit has found a “prima facie case of obviousness” when ranges within the prior art overlap with that of the claimed invention.

A prima facie case of obviousness typically exists when the ranges of a claimed composition overlap the ranges disclosed in the prior art.

In re Peterson, 315 F.3d 1325 (Fed. Cir. 2003).  That prima facie case may be overcome by evidence from the patentee — by providing evidence of unexpected results, for example.  Here, however, the PTAB did not apply this burden-shifting approach — rather, the Board cited Dynamic Drinkware and Magnum Oil as prohibiting this old-style burden-shifting framework in the IPR context.

On appeal, the Federal Circuit holds here that the traditional obviousness burden-shifting associated with ranges applies to IPR proceedings.  To be clear, the patentee never has the burden of proving non-obviousness.  But, once a prima facie case of obviousness is established, the claims will be cancelled unless the patentee provides evidence to support its position.  The court explains:

While a patentee technically has no “burden” to do anything to defend the validity of its patent other than hold the patent challenger to its own burden of persuasion, that burden of persuasion is necessarily satisfied when there is no evidentiary reason to question the prior art’s disclosure of a claimed range. Magnum Oil is not to the contrary.

Having articulated the standard, the court then looked at evidence presented — finding that “[t]he ranges disclosed in the prior art overlapped with those of claim 1.”  In particular, the court pieced together the cited references above to show overlap — when taken as a whole.  That overlap created a prima facie case of obviousness — and the patentee was unable to present evidence to unseat that initial conclusion. “At bottom, this case involves a strong case of obviousness based on very close prior art and weak evidence of nonobviousness.”

23 thoughts on “Burden Shifting at the PTAB and the Obviousness of Ranges

  1. 5

    Lourie was on this panel, Newman was not. In light of that fact, is the (incorrect) outcome with respect to burden-shifting in IPRs any surprise?

    1. 5.1

      You should listen to Lourie in oral arguments. He should retire. He basically thinks everything is just easy and he could have done it. He says “all you have done.” Just a sad judgmental sack that is unfit to judge anyone or anything.

  2. 4

    >>At bottom, this case involves a strong case of obviousness
    based on very close prior art and weak evidence of
    nonobviousness. We conclude that the Board therefore
    erred in not concluding that claims 1–5 would have been
    obvious at the time of the claimed invention.

    This seems like one of those cases where the circuit court judges are substituting their judgment for the patent judges in a factual determination of 103. So, I cannot agree with this case. I could agree with a remand that would be consistent with the framework of burden shifting. Not sure though that it is a per se prima facia case because you can build a bunch of prior art cases together that put together can make the ranges.

    Plus a factual determination that the DuPont plant isn’t copying, which seems like it may be.

    All in all, a patched together opinion that wanted to invalidate the claims and made lots of judgement calls on facts that should have been left to the patent judges.

    1. 4.1

      I guess the standing issue was decided properly, but one has to wonder about the fact that DuPont had alternative remedies including a SJ motion at DC and file a petition at the PTO.

      Plus I guess that admitted that they intended to infringe the patent. Not sure. I think without that admission that they shouldn’t have standing.

    2. 4.2

      Plus, I think the patent judges had substantial evidence that the claims were non-obvious. And I note how careful they were about the standard for standing (which included their private fact finding), but not for reversal.

  3. 3

    All, this is the first correct opinion on the injury-in-fact standard for appellate standing (Art. III standing before the CAFC originating from a prior agency adjudication). As the Court said – both under the competitor standing line of cases and the probabilistic standing line of cases – a “realistic-threat” or “substantial-risk” is enough for the injury in fact; see Susan B. Anthony List v. Driehaus, 134 S.Ct. 2334, 2341 (2014) (9:0) (Thomas, J.) (“An allegation of future injury” is enough to establish standing if “there is a ‘“substantial risk” that the harm will occur.’”); quite educational is also: Clinton v. City of New York, 524 U.S. 417, 432-34 (1998) (6:3) (Stevens, J.) (finding cooperative has standing to challenge veto of tax benefit enacted to foster ability to purchase processing plants) (“By depriving [the plaintiffs] of their statutory bargaining chip, the cancellation inflicted a sufficient likelihood of economic injury to establish standing under our precedents.”) (Probable economic injury resulting from governmental action that alters competitive conditions will satisfy the injury-in-fact requirement.”) (Noting a “sufficient likelihood of economic injury” establishes injury in fact for Article III standing).

    1. 3.1

      Yes, an improperly granted patent is a public blight that should be made as easy to remove as possible.

      This is why its especially important that the CBM review not be sunsetted, and also it’s why IPRs should be expanded to include ineligibility determinations.

      1. 3.1.1

        MM, I’m talking about the correct legal (Art. III) standing standard for appellate review of agency adjudication; it is not about the merits: Meese v. Keene, 481 U.S. 465, 473 (1987) (When evaluating standing, we must be careful not to decide the questions on the merits for or against the plaintiff, and must therefore assume that on the merits the plaintiffs would be successful in their claims)

        1. 3.1.1.1

          Interesting (starting on page 11).

          Malcolm (as usual) is in the weeds.

          1. 3.1.1.1.1

            Actually I’m waiting in line for a ticket to a foreign country to watch some birds that might go extinct because of a recently passed US law.

            1. 3.1.1.1.1.1

              Can we crowd source a one-way ticket for you?

    2. 3.2

      Good point, as this is one of the minority of IPRs in which the Petitioner filed an IPR before or without being sued for patent infringement, and the Fed. Cir. has treated this issue seriously here.
      But with the facts presented in this case after the [belated] Article III “case or controversy” jurisdictional challenge, of direct competition and exiting facilities for making the same product, it would have been shocking if the Fed. Cir. had denied jurisdiction for this appeal.

      1. 3.2.1

        Also interesting is how this panel basically ignored SAS (because the parties did not say ‘boo’ — as if that were dispositive)

      2. 3.2.2

        This may be an instance where Dupont is not infringing today, perhaps using a process in the art, but they filed the IPR to provide themselves with commercial flexibility to revise their SOP

      1. 3.3.1

        Dennis, you are very welcome; the CAFC’s injury-in-fact standard for appellate standing (Art. III standing before the CAFC originating from an appeal from an agency adjudication) is inconsistent with Supreme Court case law; both under the competitor standing line of cases and the probabilistic standing line of cases. It would be very helpful to everybody, if you or someone else could point everybody to the correct line of cases; i.e., Davis v. Federal Election Commission, 554 U.S. 724, 734 (2008) (5:4) (finding standing) (re standing the Court’s holding is 7:2) (Alito, J. wrote the majority opinion in which Roberts, Scalia, Kennedy, and Thomas, JJ joined.) (Majority Alito, J. joined by Roberts, Scalia, Kennedy, Thomas; Stevens, Souter, Ginsburg, Breyer (only as to part II, discussing standing)) (“The injury required for standing need not be actualized. A party facing prospective injury has standing to sue where the threatened injury is real, immediate, and direct.”); One of the most pertinent case is Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 152 (1970) (finding competitor standing) which was reaffirmed in Clarke v. Securities Indus. Ass’n , 479 U.S. 388 (1987) and somewhat limited in Air Courier Conference of America v. American Postal Workers Union, 498 US 517 (1991); the procedural posture in Data Processing is particularity insightful because the Court reserved an appeal court’s denial of competitor standing from an agency ruling.

        1. 3.3.1.1

          Dennis, two cases I like very much are: Friends of the Earth, Inc. et al. v. Laidlaw Environmental Services, Inc., 528 U.S. 167 (2000) (7-2) (Ginsburg, J. and joined by Rehnquist, Stevens, O’Connor, Kennedy, Souter, and Breyer, JJ.. Stevens, J. and Kennedy each filed a concurring opinion. Scalia, J. wrote a dissenting opinion, which was joined by Thomas, JJ.) (Plaintiff residents in the area of North Tyger River had standing to sue an industrial polluter against whom various deterrent civil penalties were being pursued.); Laidlaw was never overruled; and obviously Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139 (2010) (7:1) (Breyer, J. did not participate) (Court found standing for conventional alfa growers to challenge the release of a genetically altered alfa plant; standing was premised on the additional costs the farmers would have to incur in testing their crops for genetic contamination. While questions certainly could be raised about the imminence of the risk faced by the farmers, the Court’s decision finding standing is not implausible.);

  4. 2

    If my count is correct, this DuPont v. Synvina is at least the 4th time the Fed. Cir. has ironically reversed the IPR “death squad” for not being deadly enough! I.e., reversing an IPR decision of invalidity unproven.
    If the patent owner did have evidence of evidence of unexpected results or other unobviousness evidence here they should have presented it in this IPR. They may well now be blocked by Rule from doing so in any later PTO proceeding on these or patentably-indistinct claims, as recently discussed in a slightly prior Dennis blog.

    1. 2.1

      If the patent owner did have evidence of evidence of unexpected results or other unobviousness evidence here they should have presented it in this IPR.

      If the evidence existed, I can’t imagine why they wouldn’t have presented it in this IPR.

      1. 2.1.1

        Since they won at the PTAB without such evidence they may have figured they did not need to present it. Likelyhood of a Fed. Cir. reversal of a patent owner IPR win is probably not widely considered. And/or perhaps they may have thought they could do so in a reissue anyway?

        1. 2.1.1.1

          Likelyhood of a Fed. Cir. reversal of a patent owner IPR win is probably not widely considered.

          In a case like this one? Kinda odd to have expected to win in the first place.

        2. 2.1.1.2

          From the PTAB decision it is also possible that the patent owner did not have time to run its claimed process with sufficient variable claim element ranges to prove that the claimed ranges really did greatly increase the productivity of the process, as asserted? I.e., to prove “unexpected results.” But if they did not ever request additional time for that they would have waived that argument.

  5. 1

    Kudos to the CAFC for getting it right.

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