Not Crossing The Wire: Petitioner Merely "Expanded" On Previously Filed Arguments Rather Than Making "New" Arguments

• Published date: 26 May 2022
• Subject Matter: Intellectual Property, Patent
• Law Firm: Finnegan, Henderson, Farabow, Garrett & Dunner, LLP
• Author: Ms Amanda Murphy, Shannon Patrick, Emma N. Ng, Angeline Premraj, Alissa E. Green, Stacy Lewis and Thomas L. Irving

Holding

In Everstar Merchandise Co. Ltd. v. Willis Electric Co. Ltd., No. 2021-1882, 2022 WL 1089909 (Fed. Cir. Apr. 12, 2022) (non-precedential), the Court of Appeals for the Federal Circuit ("the Federal Circuit") vacated a Final Written Decision of the Patent Trial and Appeal Board ("the PTAB") in PGR2019-00056. The PTAB found that Everstar failed to show the challenged claims of Willis' patent were unpatentable as obvious. The Federal Circuit held that the PTAB abused its discretion when it refused to consider whether cost reduction would have motivated one of ordinary skill in the art to combine the asserted references, and vacated and remanded the PTAB's decision.

Background

Everstar ("Petitioner") petitioned for post-grant review of all claims of U.S. Pat. No. 10,222,037 ("the '037 patent") and asserted obviousness based on a combination of two prior art references. Id. at *2−3. The '037 patent claimed the use of a single internally-reinforced wire in decorative net lights, which reduced material costs, bulk, and weight without sacrificing strength. Id. at *2. According to the petition, one of ordinary skill in the art would have been motivated to combine the teachings of the cited references in an effort to increase strength and durability. Id. at *3.

The PTAB granted the petition, finding that the cited combination of references involved a "simple substitution of one known element for another to obtain the predictable and desirable result of a more durable wire." Id. The PTAB noted that both references described a "desire to reduce manufacturing costs" of a wire with good strength and conductivity. Id. at *3−4.

In the Patent Owner Response, Willis ("Patent Owner") argued that the references only recognized a reduction in cost when there is excess copper in the wire, and Petitioner did not argue that there was excess copper in the prior art's wires that could be reduced. Id. at *4.

In its Reply, Petitioner argued that one of ordinary skill in the art "would be motivated to incorporate the polymer reinforced wire of [reference 1 with reference 2] in order to improve durability and reduce cost." Id. (emphasis in original). Petitioner argued that the cost would be reduced because the modification would reduce the total amount of copper in the second reference's system. Id.

By Sur-Reply, Patent Owner addressed the cost reduction argument on the merits but also argued that Petitioner's motivation to combine argument based on reduction in cost was an...