Patent Act Precludes Review Of Issued Patents Under The APA

In Pregis Corp. v. Kappos, Nos. 10-1492, -1532 (Fed. Cir. Dec. 6, 2012), the Federal Circuit affirmed the denial of DJ defendant Free-Flow Packaging International, Inc.'s ("Free-Flow") motion for JMOL, holding the asserted claims of Free-Flow's U.S. Patent Nos. 7,325,377 ("the '377 patent"), 7,526,904 ("the '904 patent"); and 7,536,837 ("the '837 patent") invalid for obviousness. The Court also affirmed the dismissal of Pregis Corporation's ("Pregis") claims against the PTO under the APA for lack of subject matter jurisdiction.

Free-Flow and Pregis are competitors in the air-filled packaging cushion industry, providing cushions to fill excess space in shipping boxes. Pregis sued Free-Flow for DJ of noninfringement and Free-Flow counterclaimed for infringement of its patents relating to manufacturing air-filled packaging cushions. After a jury trial resulted in a verdict for Pregis, Free-Flow moved for JMOL, which the district court denied. On appeal, Free-Flow argued that the district court erroneously denied JMOL as to the validity and infringement of three of its patents.

The Federal Circuit first addressed the question of validity. As to Free-Flow's first argument that no evidence at trial provided a reason to combine the prior art references, the Court found sufficient factual underpinnings in the testimony of Pregis's expert witness. While Free-Flow asserted that Pregis's expert's testimony was inadequate for failing to opine on the legal conclusion of obviousness, the Court explained that the "ultimate legal conclusion of obviousness . . . was appropriately left to the district court and to this court on review of the verdict." Slip op. at 10.

In response to Free-Flow's argument that the prior art reference taught away from using the prior art machine in a manner suggested by Pregis's expert, the Court identified substantial evidence to support the jury's finding. The Court held that the mere fact that the prior art reference taught the "creation of bubble-wrap as a preferred embodiment [did] not constitute 'teaching away' from other reasonable uses," such as the air-pillow packaging discussed by Pregis's expert. Id. at 11.

"Allowing competitors to collaterally attack issued patents through suits under the APA would destroy the Patent Act's careful framework." Slip op. at 19.

Finally, the Federal Circuit held that Free-Flow's evidence of copying and commercial successobjective indicia of nonobviousnessfailed to establish the validity...