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November 29, 2006

Implicit Pressure

Even before the Supreme Court further mucks up the § 103(a) obviousness standard via its Teleflex v. KSR ruling, fear by the appeals court of the Supreme Court mucking up the obviousness standard has already warped interpretation of the law.

Since KSR filed its petition with the Supreme Court, implicit motivation to combine prior art references took the drivers seat in re Kahn, 441 F.3d 977 (CAFC 04-1616), and has been a frequent player in court rulings ever since. Hal Wegner reports that before the KSR petition, only 4% of court rulings mentioned implicit motivation using the TSM (teaching-suggestion-motivation) test, while 40% post KSR-petition. Mere mention of implicit motivation went from 6% to 50%.

During KSR oral arguments, Justice Souter observed the repercussion of having a subjective obviousness standard: "tip it over now is going to produce chaos." That is already happening.

The root of the problem lies in 35 U.S.C. § 103(a) itself: failing to enunciate a standard, the statute is too vague, too subject to judicial interpretation. Drafted by the brilliant Judge Giles Rich, who may have conceived of an objective standard of one with "ordinary skill in the art," the applied standard of obviousness has already slipped into subjective anarchy, as the CAFC has wiggled from political pressure, rather than setting a useful standard.

One can only hope that the concept of objectivity weighs on the Supreme Court justices in crafting a clarification of what is obvious. Oral arguments painted a dismal portent that the judges grasp the problem.

During trial, expert witnesses act a surrogate for "one skilled in the art," and a third party, judge or jury, apprises credibility. During prosecution, the examiner is expert witness, judge and jury combined. Albany Law School Professor Gregory Mandel has proposed bifurcated examination process to deal with this issue.

Overall, the trend toward broadening the obviousness standard can be attributed to political pressure: large corporations clamoring for "patent reform," which in reality translates to trying to minimize the cost of infringement. Microsoft, for example, is constantly barraged with 35-40 patent infringement assertions at any one time.

The Eolas case, where Microsoft paid over a half-billion dollars for infringement to a patent where the work-around amounted to a single click of a mouse, is often cited as exemplary of a patent system run amok. But the simplicity of a workaround does not translate to a perversely valued patent, just as the value of a patent does not translate to how innovative the claimed invention is - these aspects are orthogonal. The Eolas patent, after all, survived both determined court challenge and reexam. One can, of course, argue that the wrong standard of anticipation applied at the time.

The obviousness standard is the single most important facet of weeding out undeserved patents. Legislative statutory reform is unlikely in the next two years, as it is a low priority with the Democrat-controlled Congress. With KSR v. Teleflex, the Supreme Court faces the challenge of righting the wrong direction that the obviousness standard is already heading. The trick is to be able to weed out minor improvements undeserving of 20-year patent protection by using evidence that is reasonably objective. Sticking with implicit subjectivity is going to raise costs, both in prosecution and in the courts, as anticipation appears as a crap shoot, and invalidity rejections beget appeal. An obviousness standard based on metrics that smack of requiring objective analysis, where the players at least sense how the rules will be applied, is the single best hope for improving the U.S. patent system.

Posted by Patent Hawk at November 29, 2006 6:44 PM | Prior Art

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