Patent Watch: Kinetic Concepts, Inc. v. Smith & Nephew, Inc.

Alerts / August 21, 2012

The objective indicia of nonobviousness serve a particularly important role [where] there is a battle of scientific experts regarding the obviousness of the invention [because] the objective indicia provide an unbiased indication regarding the credibility of that evidence.

On August 13, 2012, in Kinetic Concepts, Inc. v. Smith & Nephew, Inc., the U.S. Court of Appeals for the Federal Circuit (Bryson, Dyk, O'Malley*) reversed and remanded the district court's judgment as a matter of law that U.S. Patents No. 7,216,651 and No. 5,645,081, which related to the treatment of difficult-to-heal wounds by applying suction or negative pressure, were invalid for obviousness notwithstanding the jury verdict to the contrary. The Federal Circuit stated:

A patent is obvious, and, therefore, invalid "if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains." Obviousness is a question of law based on underlying factual findings: (1) the scope and content of the prior art; (2) the differences between the claims and the prior art; (3) the level of ordinary skill in the art; and (4) objective indicia of nonobviousness. A party seeking to invalidate a patent on the basis of obviousness must "demonstrate 'by clear and convincing evidence that a skilled artisan would have been motivated to combine the teachings of the prior art references to achieve the claimed invention, and that the skilled artisan would have had a reasonable expectation of success in doing so.'" While an analysis of any teaching, suggestion, or motivation to combine elements from different prior art references is useful in an obviousness analysis, the overall inquiry must be expansive and flexible. This court has explained, moreover, that the obviousness inquiry requires examination of all four Graham factors. Indeed, courts must consider all of the Graham factors prior to reaching a conclusion with respect to obviousness. At all times, the burden is on the defendant to establish by clear and convincing evidence that the patent is obvious.

The parties agree on which references are prior art. [But in view of] conflicting expert testimony, the jury was free to "make credibility determinations and believe the witness it considers more trustworthy." In light of the jury's determination that S&N failed to prove obviousness, we must infer that the jury found Wake Forest's experts to be credible and persuasive on this point. Crediting their testimony over that of S&N's expert, there is substantial evidence supporting the factual finding that the Bagautdinov references do not disclose: (1) the treatment of "wounds" as described in patents; or (2) use of negative pressure to treat wounds. There is also substantial evidence to support the finding that the references teach away from maintaining negative pressure on a wound for extended periods of time because of the perceived problems associated with doing so.

Although the parties did not stipulate the level of ordinary skill in the art, S&N's expert testified that the level of ordinary skill in the art "would include health care professionals, for example physicians or nurses, but it could be a podiatrist or somebody else, who has additional training or knowledge about wound care. It could also be engineers with experience operating or designing equipment used in conjunction with wound care." According to the district court, Wake Forest asserted that the level of skill was higher. Because it is generally easier to establish obviousness under a higher level of ordinary skill in the art, we must assume that, in light of the jury's verdict, it adopted the lower level of skill proposed by S&N.

The jury explicitly found that the prior art and the asserted claims exhibited several differences, which S&N conceded existed. In addition, the jury stated that each of the prior art references exhibited additional differences from those explicitly mentioned on the verdict form, although they were not asked to and, thus, did not identify those additional differences.

Although there are many differences between the primary prior art references and the asserted claims, for the purpose of this appeal, we need only focus on three. As discussed above, substantial evidence supports the finding that none of the references discloses treating wounds with negative pressure as required by the patents. Nor do the Bagautdinov and Chariker-Jeter references relate to the treatment of wounds described in the patents . . . . Finally, the Bagautdinov references and the Zamierowski reference do not disclose a seal capable of maintaining negative pressure. Accordingly, none of the references discloses healing or treatment with negative pressure. Only the Zamierowski reference discloses treating or healing wounds and only the Chariker-Jeter printed publications disclose a seal that is capable of maintaining pressure.

Even if the references disclosed all of the limitations of the asserted claims, which they do not, S&N still needed to proffer evidence indicating why a person having ordinary skill in the art would combine the references to arrive at the claimed invention. Significantly, whether there is a reason to combine prior art references is a question of fact. Here, not only did S&N offer no evidence establishing a reason to combine, but Wake Forest offered substantial evidence that a person having ordinary skill in the art had no reason to combine the prior art references to arrive at the claimed invention. In light of the jury's verdict, we must assume that it determined there was no reason to combine the prior art references, and we must defer to this factual finding because it is supported by substantial evidence.

[D]octors were not using the disclosed devices and methods to heal wounds with negative pressure because they did not believe that these devices were capable of such healing. In fact, several of the primary references disclosed methods that purposefully minimize granulization while the devices were in place because of the perceived dangers associated with negative pressure. This amounts to significant evidence of teaching away. On the basis of this evidence, hindsight provides the only discernable reason to combine the prior art references. Unless one knew that negative pressure could be used to treat wounds, there would be no reason to combine the prior art to arrive at the claimed device and methods. It is clear, moreover, that the district court concluded that the invention was obvious because it believed the claims contained elements that were not new. This reasoning is incorrect: "a patent composed of several elements is not proved obvious merely by demonstrating that each of its elements was, independently, known in the prior art." Because none of the prior art references disclosed utilizing negative pressure to heal wounds, this is not even a case where the inventions at issue are merely composed of elements that were known in the art. . . . Finally, the significant objective indicia of nonobviousness strongly weigh against a finding of obviousness. We require analysis of the objective indicia because they "provide objective evidence of how the patented device is viewed in the marketplace, by those directly interested in the product." [T]he medical community scoffed at this device when it was initially introduced. The industry was skeptical that the device worked even after reading studies that established that it did in fact work. After the system was disseminated, moreover, everyone began using it, and the method and apparatus were copied. This evidence provides a key objective insight into how the medical community viewed the patented device.

Significantly, this is not a case where the jury found the presence of only one or two objective indicia of nonobviousness. Nor is it a case where S&N seriously disputes those findings. Rather, the evidence strongly establishes the existence of nearly every objective indicia of nonobviousness, namely commercial success, long-felt need, copying, unexpected and superior results, wide spread acceptance in the field, and initial skepticism. We recently warned about the dangers of ignoring objective indicia of nonobviousness [when] we said: "[s]imply because the technology can be easily understood does not mean that it will satisfy the legal standard of obviousness. In fact, objective consideration of simple technology is often the most difficult because, once the problem and solution appear together in the patent disclosure, the advance seems self-evident." The objective indicia of nonobviousness serve a particularly important role in a case, like this one, where there is a battle of scientific experts regarding the obviousness of the invention. In such a case, the objective indicia provide an unbiased indication regarding the credibility of that evidence.

If you have questions about the material presented above, please contact Dr. Lawrence M. Sung (lsung@bakerlaw.com or 202.861.1537) or any member of our Intellectual Property Team.

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