December 7, 2016
If the PTAB Doesn’t Say Why the Invention is Obvious, the Federal Circuit Has Nothing to Affirm
In re Nuvasive, Inc., [2015-1670] (December 7, 2016), the Federal Circuit vacated and remanded the PTAB Decision finding claims of U.S. Patent No. 8,361,156 invalid for obviousness. The Federal Circuit found that Nuvasive waived its argument that asserted references weren’t sufficiently public to qualify as printed publications. On the issue of obviousness, however, the Federal Circuit sided with Nuvasive.
The Federal Circuit said that in assessing the prior art, the PTAB “consider[s] whether a PHOSITA [person having ordinary skill in the art] would have been motivated to combine the prior art to achieve the claimed invention.” The Federal Circuit said that the factual inquiry whether to combine references must be “thorough and searching,” and that the need for specificity pervades its authority on the PTAB’s findings on motivation to combine.
Nuvasive pointed out that the Final Written Decision did not make adequately explained findings of the motivation to combine, relying upon a single conclusory statement by petitioner’s expert. The Federal Circuit agreed, noting:
Two distinct yet related principles are relevant to our review. First, the PTAB must make the necessary findings and have an adequate ‘evidentiary basis for its findings.’ … Second, the PTAB ‘must examine the relevant data and articulate a satisfactory explanation for its action including a rational connection between the facts found and the choice made.’
The Federal Circuit added that the PTAB must provide “a reasoned basis for the agency’s action,” and it will uphold a decision of less than ideal clarity if the agency’s path may reasonably be discerned.
The Federal Circuit then identified several instances with insufficient articulations of motivation. First, conclusory statements alone are insufficient; instead the finding must be supported by a “reasoned explanation.” Second, it is not adequate to summarize and reject arguments without explaining why the PTAB accepts the prevailing argument. Third although reliance on common sense may be appropriate in some circumstances, the PTAB cannot rely solely on common knowledge or common sense to support its findings.
Turning to the decision before it, the Federal Circuit said that the PTAB failed to explain the reason why a PHOSITA would have been motivated to modify the prior art. While the PTAB rejected Nuvasive’s arguments that the invention was not obvious, the PTAB never actually made an explanation-supported finding that the evidence affirmatively proved that the PHOSITA would modify the prior art as proposed by petitioner.
Because it could not reasonably discern the PTAB’s reasoning as to motivation
to combine, judicial review cannot meaningfully be achieved, so the Federal Circuit
vacated and the case remanded for additional PTAB findings and explanations regarding the PHOSITA’s motivation to combine the prior art references.