DyStar Textilfarben GmbH & Co. Deutschland KG ("DyStar") sued defendants C.H. Patrick Co. and Bann Quimica Ltda. (collectively, "Bann")..., alleging direct, contributory, and induced infringement of... 5,586,992, which discloses a process for dyeing textile materials with catalytically hydrogenated leuco indigo. DyStar and Bann Quimica Ltda. are large chemical manufacturers that, inter alia, sell prereduced indigo for use in dyeing processes; C.H. Patrick Co. purchased prereduced indigo solution from Bann Quimica Ltda. in 2002 and used it to dye yarn in a process alleged to infringe.

Indigo has been used in dyeing textile materials for thousands of years. Because indigo pigment is insoluble in water, it must be de-oxidized, or "reduced," to a water-soluble white form known as "leuco indigo" before it can be used in dyeing. Leuco indigo is unstable; it oxidizes and returns to its blue pigment form when exposed to oxygen. Thus, leuco indigo solution needs to be kept in an oxygen-free environment, or otherwise stabilized, if it is not being used immediately for dyeing.

For many years, dyehouses commonly reduced indigo in-house through a process known as hydrosulfite reduction. Dyers created a "stock vat," in which indigo is reduced in water with sodium hydrosulfite and solubilized with an alkali, e.g., sodium hydroxide. The resulting leuco indigo solution is then transferred into a feed tank and fed into the dyebath. After the dyebath is prepared, the textile material is dyed through a process known as "dipping" and "skying." In "dipping," the textile material is contacted with leuco indigo in the dyebath; in "skying," the dyed textile material is introduced to the air, causing the indigo to convert back to its blue pigment form.

A second common method of indigo reduction, catalytic hydrogenation, was patented by Andre Brochet in 1917: 1,247,927. The superficial difference between hydrosulfite reduction and catalytic hydrogenation is that the latter uses gaseous hydrogen, rather than sodium hydrosulfite, as a reducing agent.

The process of dyeing textile materials with catalytically hydrogenated leuco indigo traditionally has involved six steps... The '992 patent thus improved upon the prior art by eliminating steps....

Bann asserts that claim 1 of the '992 patent is invalid because it is anticipated by Brochet. Bann further argues that claims 1-4 are invalid as obvious in light of Brochet and certain other prior art, including two pre-1917 BASF patents—United States Patent Nos. 820,900 ("Wimmer") and 885,978 ("Chaumat"), a post-World War II report of the British Intelligence Objectives Sub-Committee ("BIOS report"), and the 1936 Manual for the Dyeing of Cotton and Other Vegtable Fibres ("Manual"), published by General Dyestuff Corporation. We address the broader argument, relating to obviousness, first.

Bann's obviousness argument rests primarily on three U.S. patents: Brochet, Wimmer, and Chaumat. Brochet is directed to "the Manufacture of Leuco Derivatives of Vat Dyestuffs" generally, of which indigo is one. Brochet, ll.6-7. By its plain language, Brochet discloses the process of preparing an aqueous solution of leuco indigo by catalytic hydrogenation. There can be no serious dispute that the ultimate use of a "dyestuff" is dyeing textile materials; indeed, the '992 patent inventor, Georg Schnitzer, testified that leuco indigo solutions were known to be used in 1917 for dyeing, and Dr. Richard Blackburn, one of DyStar's technical experts, testified that BASF began reducing indigo with catalytic hydrogenation, and selling the reduced indigo to dyehouses, in 1926. Moreover, both parties agree that dipping and skying were well known in the art. As explained supra, when indigo is reduced in-house in a stock vat, the resulting leuco indigo solution is introduced directly into the dyebath without first being stabilized through drying. Thus, the critical issue in our obviousness analysis is whether stabilizing catalytically reduced leuco indigo in solution form, rather than in powder form coated with molasses, for example, renders the claimed process nonobvious to one of ordinary skill in the art.

Before getting into the specifics of the case, the CAFC went on a wee bender to lament misunderstanding of obviousness by "some commentators," and to explain the court's lubricious application of 103(a).

As we recently explained in Alza Corp. v. Mylan Labs., Inc., No. 06-1019, 2006 U.S. App. LEXIS 22616 (Fed. Cir. Sept. 6, 2006), the suggestion test—as our motivation-to-combine inquiry has come to be known—"prevent[s] statutorily proscribed hindsight reasoning when determining the obviousness of an invention." Id. at *7. This test "informs the Graham analysis", id. at *8 (quoting In re Kahn, 441 F.3d 977, 987 (Fed. Cir. 2006)), by implementing the Supreme Court's recognition of "the importance of guarding against hindsight, as is evident in its discussion of the role of secondary considerations as 'serv[ing] to guard against slipping into use of hindsight and to resist the temptation to read into the prior art the teachings of the invention in issue.'" Id. at *6 (quoting Graham, 383 U.S. at 36).

In contrast to the characterization of some commentators, the suggestion test is not a rigid categorical rule. The motivation need not be found in the references sought to be combined, but may be found in any number of sources, including common knowledge, the prior art as a whole, or the nature of the problem itself. In re Dembiczak, 175 F.3d 994, 999 (Fed. Cir. 1999). As we explained in Motorola, Inc. v. Interdigital Tech. Corp., 121 F.3d 1461, 1472 (Fed. Cir. 1997), "there is no requirement that the prior art contain an express suggestion to combine known elements to achieve the claimed invention. Rather, the suggestion to combine may come from the prior art, as filtered through the knowledge of one skilled in the art."

For one to conclude that the invention of the '992 patent would have been obvious, then, the prior art, common knowledge, or the nature of the problem, viewed through the eyes of an ordinary artisan, must have suggested the following steps: (1) creating leuco indigo solution through catalytic hydrogenation; (2) stabilizing the leuco indigo in solution form; (3) adding the leuco indigo solution directly into a dyebath; (4) dipping; and (5) skying. Because the jury did not make explicit factual findings in the form of answers to written interrogatories or special verdicts, we must discern the jury's implied factual findings by interpreting the evidence consistently with the verdict and drawing all reasonable inferences in DyStar's favor. Konkel v. Bob Evans Farms Inc., 165 F.3d 275, 279 (4th Cir. 1999).

It all came down to chemistry - whether a dyer would have a chemistry background.

1. Level of Ordinary Skill in the Art

Because the parties disagree over the relevance of the cited prior art, which, fundamentally, is a disagreement over the level of ordinary skill in the art, we address this third Graham factor first. DyStar asserts that we must disregard Brochet, Wimmer, and Chaumat, because a person of ordinary skill in the art would not be aware of these references. In short, DyStar argues that no knowledge of chemistry is required in the relevant technical field.

DyStar points to testimony from Dr. Blackburn that "[a] person of ordinary skill in the art is a dyer", someone with "a high school degree" who is "able to read and write", but whose knowledge is limited to "flipping the switches" on the machine. Dr. Blackburn also testified, however, that a person of ordinary skill in the art was "running the dye processes", which required, inter alia, "doing the calculations". When confronted with the inconsistency between his testimony regarding the applicable level of skill during cross-examination, Dr. Blackburn stated that "it's difficult to say" which of the two skill levels should be applied to the obviousness inquiry. Dr. Blackburn explained that "those people may do both jobs", but concluded by stating, "I think the former [i.e., the person 'flipping the switches']" is the ordinary artisan. Thus, the jury had evidence before it of two potential levels of ordinary skill: (1) that of a dyer and (2) that of a person creating the dye processes, who we will refer to as a dyeing process designer.

DyStar presented evidence that The Application of Vat Dyes, a book by the American Association of Textile Chemists and Colorists, teaches people how to dye and is a text that a dyer would have had at the time of the '992 patent invention. Dr. Nolan Etters, Bann's expert witness, agreed that "a person of ordinary skill in the art" would be a member of the American Association of Textile Chemists and Colorists and conceded that none of the prior art cited by Bann is referenced in The Application of Vat Dyes.

We agree with DyStar that we are required to assume the jury accepted its argument that a person of ordinary skill in the art is a dyer with no knowledge of chemistry. Because the jury heard testimony that the prior art cited by Bann was directed toward chemists, not dyers, the jury must have found the prior art cited by Bann neither in the relevant art nor analogous arts and then, consistent with the limited evidence of prior art deemed relevant, concluded that the process claimed in the '992 patent would not have been obvious.

The appeals court lays the essential groundwork for anticipation via combination: that all of the prior art cited by the defendants went to solving the same problem as the patent claims.

However, substantial evidence does not support the jury's finding that a person of ordinary skill is a dyer with no knowledge of chemistry. Indeed, that factual finding is inconsistent with the '992 patent's very purpose. The technical problem that the process of the '992 patent and the prior art cited by Bann sought to solve is precisely the same: an improved process for dyeing textile materials with indigo. This process includes several discrete subcomponents—e.g., indigo reduction and dyebath preparation—and an ordinary artisan would be concerned with all of them. To beneficially practice the dyeing process claimed in the '992 patent, the ordinary artisan must have a higher-level perspective, as he must first decide whether it is more efficient to reduce indigo in-house or purchase prereduced indigo and, if prereduced, must then decide whether solid or solution form is preferable.

Designing an optimal dyeing process requires knowledge of chemistry and systems engineering, for example, and by no means can be undertaken by a person of only high school education whose skill set is limited to "flipping the switches". This is especially true when one considers that only in the last century have improvements in indigo reduction chemistry enabled outsourcing of the indigo reduction step from dyehouses to chemical manufacturers; prior to that simplification, there would have been no question that a dyer would also require knowledge of indigo reduction. Because, for this patent, the only finding supported by substantial evidence is that an ordinary artisan is not a dyer but a person designing an optimal dyeing process, the jury's implicit finding of a mere dyer cannot withstand scrutiny on JMOL. Accordingly, the jury's apparent decision to disregard Brochet, Wimmer, and Chaumat, and perhaps other prior art references, as neither in the dye process art nor even in analogous arts is unsupported by substantial evidence.

2. Scope and Content of Prior Art

Where, as here, claim limitations are found in a combination of prior art references, the factfinder must determine "[w]hat the prior art teaches, whether it teaches away from the claimed invention, and whether it motivates a combination of teachings from different references". Fulton, 391 F.3d at 1199-1200 (Fed. Cir. 2004).

To support its argument that an ordinary artisan—i.e., a dyeing process designer—would have known to attempt to stabilize the Brochet solution in oxygen-excluding conditions for addition directly into a dyebath, Bann points to two pre-Brochet BASF patents. Wimmer, issued in 1906,... [and] Chaumat, issued in 1908... Bann argues that this prior art would teach an ordinary artisan in the field of indigo dyeing process design to attempt to stabilize any leuco indigo solution, however reduced, for addition directly into the dyebath.

a. What does the prior art teach?

DyStar argues that because Wimmer and Chaumat involve different methods of reducing indigo, they are nonanalogous art and properly disregarded by the jury... We disagree. As explained supra, the proper focus is on the indigo dyeing process as a whole, which requires the ordinary artisan to consider (and choose between) the various indigo reduction methods. The '992 patent is directed toward a process of dyeing with indigo and, although a specific method of reduction is required by claim 1, the first step in the process requires indigo in prereduced form. It is undisputed that reduced indigo by any reduction method, not just catalytic hydrogenation, has been used in the indigo dyeing process. The prior art involving indigo reduction by other methods is thus not merely analogous art, it is the same art. Accordingly, all limitations recited by claim 1 of the '992 patent—including the immediate use of leuco indigo solution for dyeing—are contained in the prior art.

b. Does the prior art teach away from the claimed invention?

Dystar had argued that the prior art references taught away from the claimed invention, but could not point to specific language. Needless to say, the appeals court said to that: "We will not read into a reference a teaching away from a process where no such language exists."

c. Is there a motivation to combine?

DyStar argues that this court's "suggestion test" for obviousness requires the cited references themselves to contain a suggestion, teaching, or motivation to combine them, and that it must be explicitly stated.

The CAFC, feeling stung that Dystar's argument of requiring explicit suggestion was a misinterpretation widely presumed, waved it away as stemming from cases "quoted out of context."

DyStar's argument misreads this court's cases and misdescribes our suggestion test, echoing notions put forth recently by various commentators and accepted in major reports.

It is difficult to see how our suggestion test could be seen as rigid and categorical given the myriad cases over several decades in which panels of this court have applied the suggestion test flexibly. Obviousness is a complicated subject requiring sophisticated analysis, and no single case lays out all facets of the legal test.

The above underlined statement is nothing short of disingenuous, and rather ridiculous, prima facie. How could any lower court apply a caselaw metric unless "all facets of the legal test," where laid out?! Blithe reading would construe that the CAFC was just making up the rules as it went along, and, in recent cases, bowing to political pressure. If there has been such widespread confusion about the applicable standard for obviousness, the problem lies squarely at the feet of the CAFC, precisely for not clearly elucidating the boundaries of obviousness.

In its exposition, the CAFC went through a litany of obviousness cases: Pro-Mold & Tool v. Great Lakes Plastics, Sandt Tech. v. Resco Metal & Plastics; Mazzari v. Rogan, Sakraida v. AG Pro, Anderson's-Black Rock. v. Pavement Salvage, and United States v. Adams.

Our suggestion test is in actuality quite flexible and not only permits, but requires, consideration of common knowledge and common sense. See, e.g., In re Kotzab, 217 F.3d 1365, 1369 (Fed. Cir. 2000) ("A critical step in analyzing the patentability of claims pursuant to section 103(a) is casting the mind back to the time of invention, to consider the thinking of one of ordinary skill in the art, guided only by the prior art references and the then-accepted wisdom in the field."); Motorola, 121 F.3d at 1472 ("[T]he suggestion to combine may come from the prior art, as filtered through the knowledge of one skilled in the art."); Bozek, 416 F.2d at 1390 ("Having established that this knowledge was in the art, the examiner could then properly rely, as put forth by the solicitor, on a conclusion of obviousness 'from common knowledge and common sense of the person of ordinary skill in the art without any specific hint or suggestion in a particular reference.'").

Indeed, we have repeatedly held that an implicit motivation to combine exists not only when a suggestion may be gleaned from the prior art as a whole, but when the "improvement" is technology-independent and the combination of references results in a product or process that is more desirable, for example because it is stronger, cheaper, cleaner, faster, lighter, smaller, more durable, or more efficient. Because the desire to enhance commercial opportunities by improving a product or process is universal—and even common-sensical—we have held that there exists in these situations a motivation to combine prior art references even absent any hint of suggestion in the references themselves. In such situations, the proper question is whether the ordinary artisan possesses knowledge and skills rendering him capable of combining the prior art references.

Although this court customarily discusses a motivation to combine as part of the first Graham factor, the scope and content of the prior art, see SIBIA Neurosciences, 225 F.3d at 1356, motivation to combine is also inextricably linked to the level of ordinary skill. If, as is usually the case, no prior art reference contains an express suggestion to combine references, then the level of ordinary skill will often predetermine whether an implicit suggestion exists. Persons of varying degrees of skill not only possess varying bases of knowledge, they also possess varying levels of imagination and ingenuity in the relevant field, particularly with respect to problem-solving abilities. If the level of skill is low, for example that of a mere dyer, as DyStar has suggested, then it may be rational to assume that such an artisan would not think to combine references absent explicit direction in a prior art reference. If, however, as we have held as a matter of law, the level of skill is that of a dyeing process designer, then one can assume comfortably that such an artisan will draw ideas from chemistry and systems engineering—without being told to do so.

The court then characterized a dyeing process designer, aspect by aspect, as sufficiently knowledgeable and skilled to appreciate the prior art and come up with the patented solution.

Although the '992 patent claimed a new, more efficient, way of performing a known function, dyeing indigo—the asserted innovation, storing leuco indigo solution in airtight containers for immediate use in dyebaths, is merely "exploitation" of the well-known principle of vacuum packaging. See Sakraida, 425 U.S. at 279. In sum, it is the work of a skilled chemist, not of an inventor.

The CAFC mulled secondary considerations of nonobviousness: success of the patented process, by which the CAFC was unimpressed. Even the lapse of decades since the cited prior art and Dystar's commercialization didn't faze the court. There was, as well, as Dystar dyed it, an earlier failed attempt.

[A]nother secondary consideration cited by DyStar—i.e., failed attempts—actually detracts from its argument, and heavily so. DyStar points out that another chemical company, Buffalo Color, abandoned a 1979 effort to market a prereduced indigo solution made by hydrosulfite reduction. The record shows, however, that Buffalo was only mildly concerned with instability problems—it noted only that the instability of leuco indigo "would require special (and costly) shipping conditions to protect it from oxidation". Rather, Buffalo decided against selling a leuco indigo solution because it would involve increased shipping costs, might require customers to invest in additional storage facilities, and would cost more to produce, likely forcing it to increase prices to customers. Buffalo's decision was thus not a failed attempt, but a calculated business judgment to abandon a potential new product line.

The ruling then went claim by claim, considering anticipation.

In sum, because an ordinary artisan is a person designing an optimal textile dyeing process with some expertise in chemistry, the jury's implicit finding that the level of ordinary skill in the art is a dyer is unsupported by substantial evidence; its corresponding decision to disregard the primary cited prior art as nonanalogous was also erroneous. Under the correct level of ordinary skill, it would have been obvious from Chaumat and Brochet, in view of Wimmer and other references, to stabilize catalytically hydrogenated leuco indigo solution through vacuum conditions and to introduce the solution directly into the dyebath.

[A]ll claims are held invalid for obviousness....

The backdoor to invalidity by obviousness, lacking veracity of suggestion within the prior art, is to pull together prior art references solving the same problem, making sure those references would have been appreciated by someone of equivalent skill to the target patent applicant.