In Rare Case, Secondary Indicia Of Nonobviousness Overcome Prima Facie Case Of Obviousness

In a rare holding, the Federal Circuit in Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc., No. 2011-1555, held that objective evidence of nonobviousness was so strong that it rebutted a prima facie case of obviousness. ---F.3d--- (Fed. Cir. 2012)(Moore, J.) (Transocean II). The dispute started in 2007 when Transocean alleged that three of its patents were infringed by a rig that Maersk was building in the Gulf of Mexico. Transocean's patents are directed to a "dual activity" offshore drilling vessel with two stations that operate together to drill an oil well in the ocean floor. In contrast to "single activity" vessels with only one station, dual activity vessels offer significant cost and efficiency savings.

In the earlier Transocean I proceedings, the Federal Circuit held that Maersk had established a prima facie case of obviousness, but nonetheless overturned summary judgment of obviousness because the district court had failed to weigh the fourth Graham factor: "To be clear, a district court must always consider any objective evidence of nonobviousness presented in a case." Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc., 617 F.3d 1296, 1305 (Fed. Cir. 2010)(Moore, J.). On remand, the jury found that Transocean's patents were nonobvious and awarded $15 million to Transocean. Notwithstanding the jury's verdict, the district court granted Maersk's motion for judgment as a matter of law that the claims were obvious. Transocean appealed.

In Transocean II, the Federal Circuit reinstated the jury verdict, holding that the secondary indicia of nonobviousness were so substantial that no reasonable jury could have found the claims obvious. Transocean ultimately prevailed because it successfully tied the objective evidence of nonobviousness to the merits of the patented invention:

Commercial Success — Customer contracts showed that Transocean's customers expressly required dual activity rigs, which commanded a market premium over single activity rigs because of the efficiency gains. Industry Praise and Unexpected Results — Competitors noted the unexpected efficiency gains, and the claimed invention was praised as one of 50 key technologies to have shaped the offshore drilling industry. A magazine article also hailed dual activity rigs as "critical to [the] future" of offshore drilling. Copying — Maersk...