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Federal Circuit Vacates Another PTAB Decision Based on a Lack of Adequate Explanation

A failure to provide an adequate explanation for findings of obviousness is becoming the Federal Circuit’s recurring rationale for vacating decisions by the Patent Trial and Appeal Board. In recent months, the Federal Circuit has consistently overturned decisions by the Patent Trial and Appeal Board based on the Board’s lack of an adequate reason or basis for its decisions. The latest in this string of decisions is Securus Technologies. Inc., v. Global Tel*Link Corp., Case No. 2016-1993 (Fed. Cir. April 25, 2017), in which the Federal Circuit vacated-in-part the decisions in IPR2014-01278 and IPR2014-01282 declaring that the holdings pertaining to certain dependent claims were insufficient.

Globus Tel*Link had filed petitions for inter partes review challenging the patentability of U.S. Patent No. 7,860,222 and alleging that all of the claims were obvious. The claims are directed to information systems and methods for the acquisition and analysis of investigative information. The Board issued final written decisions finding all of the claims to be obvious. Securus appealed the Board’s decisions on several grounds one of which was that it failed to articulate any explanation as to why certain dependent claims were obvious. The Federal Circuit agreed with this argument, finding that the Board failed to provide any reasoning in either of its decisions and that such reasoning is required to allow for meaningful review by the court. Citing previous precedent, the Federal Circuit noted that “[w]e do not require perfect explanations and will uphold the Board’s decision if we may reasonably discern that it followed a proper path, even if that path is less than perfectly clear.  However, it is not adequate to summarize and reject arguments without explaining why the [Board] accepts the prevailing argument.” Slip op. at 14(citations omitted).

This most recent decision joins a long line of cases over the last year where the Federal Circuit has consistently criticized final decisions by the Board for a lack of adequate explanation. It appears that this trend will only continue to grow in 2017 as the Federal Circuit has already issued several opinions in the last couple months vacating Board decisions.

For example, in In re Van Os, Case No. 2015-1975 (Fed. Cir. Jan. 3, 2017), the Federal Circuit vacated the Board’s decision upholding a patent examiner’s obviousness rejection of Van Os’ claims. In its decision, the Board incorporated the examiner’s analysis and found the claims to be obvious based on the fact that the combination of the prior art would have been “intuitive”. The Federal Circuit explained that since the Supreme Court’s decision in KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398 (2007), the Federal Circuit has consistently stated that obviousness findings based on common sense must provide a clear explanation giving a reason for why common sense forces an obviousness rejection. The Federal Circuit found in this case that the Board did not point to any motivation to combine or provide any explanation for why modifying the prior art references would have been intuitive. Specifically, the Federal Circuit stated that “[absent some articulated rationale, a finding that a combination of prior art that would have been ‘common sense’ or ‘intuitive’ is no different than merely stating the combination would have been obvious. Such a conclusory assertion with no explanation is inadequate[.]” Slip op. at 5.

Similarly, in In re: Schweickert, Case No. 2016-1266 (Fed. Cir. Jan. 26, 2017), the Federal Circuit found the Board’s obviousness determination deficient because it failed to explain why or how a person of ordinary skill in the art would modify or manipulate the cited prior art to create the features of the claimed invention. Specifically, the Federal Circuit noted that “the Board, at best, merely posits that a skilled artisan could combine [the references], notwithstanding any difficulties, and would do so because these references were within the knowledge of a skilled artisan.” Slip op. at 12.

More recently, in Personal Web Technologies, LLC v. Apple, Inc., Case No. 2016-1174 (Fed. Cir. Feb. 14, 2017), the Federal Circuit called the Board’s decision inadequate due to its failure to sufficiently explain and support its determination that a person of ordinary skill in the art would have been motivated to combine the cited prior art references to arrive at the claimed invention. The Federal Circuit reasoned that the Board’s limited explanation “seems to say no more than that a skilled artisan presented with two references, would have understood that they could be combined.” Slip op. at 11. The Federal Circuit further emphasized that “the Board nowhere clearly explained, or cited evidence showing, how the combination of the two references was supposed to work.” Slip op. at 12.

As demonstrated by these recent decisions, there is a consensus that the Board must provide more than mere conclusory statements in support of its findings of obviousness. These decisions also further articulate the Federal Circuit’s recurring themes to not only hold the Board accountable for its decision-making process but also to seek to ensure that its decisions are based on adequate reasoning. As such, both patent owners and petitioners would be wise to carefully review the Board’s final decisions as either party may have a strong argument on appeal if the Board failed to provide sufficient reasoning for its determinations.