In Ethicon LLC v. Intuitive Surgical, Inc., the Court of Appeals for the Federal Circuit (“CAFC”) upheld a finding from the Patent Trial and Appeal Board (“Board”) the claims of Ethicon’s patent directed to a surgical stapler were invalid on obviousness grounds.1
Ethicon LLC (“Ethicon”) is the assignee of U.S. Patent No. 9,844,379 (“the ’379 patent”), which is directed to a surgical stapler containing two main components: a stapling assembly and a “lockout feature.” The lockout feature is configured to prevent accidental firing of the stapling assembly and can “advantageously prevent the inadvertent severing of tissues when the device is loaded with a spent cartridge or no cartridge.”2 The lockout feature is useful for endoscopic procedures that require surgeons to operate without being able to see or feel the tissue intended for stapling.
Ethicon asserted the ’379 patent against Intuitive Surgical, Inc., (“Intuitive”) in a U.S. International Trade Commission proceeding on May 24, 2019.3 About five months into the case, Intuitive filed two Inter Partes Reviews challenging all claims of Ethicon’s ’379 patent as being anticipated and obvious; the Board consolidated both proceedings.4 The Board held that Intuitive had shown by a preponderance of the evidence that the challenged claims were unpatentable on obviousness grounds. The Board did not reach the merits of the anticipation grounds.5
The Board’s obviousness ruling was based on prior art to Green6 and Solyntjes7. Green accounted for the majority of the stapling assembly component, and Solyntjes disclosed the lockout component. Ethicon did not dispute that the claimed features of the ’379 patent were present in both prior art references, but disputed that a person of ordinary skill in the art (“POSA”) would have been motivated to combine the references and that a POSA would have a reasonable expectation of success in doing so.8
The Board’s decision relied heavily on the testimony of the parties’ experts. Intuitive’s expert, Dr. Knodel, was credited for providing testimony that was “logical and credible and appropriately reflects the types of design assessments” that a POSA would employ in seeking to improve Green’s instrument based on Solyntjes’ teachings of the lockout feature.9 Ethicon’s expert, Dr. Fronczak, was regarded as providing unpersuasive and speculative testimony regarding the motivation to combine the teachings because, according to Dr. Fronczak, a POSA “would have regarded Green’s disclosure as ‘negating the need for a no-cartridge lockout in Green.’”10 Dr. Fronczak also testified that there would be no reasonable expectation of success of adding the spring-and-pin lockout mechanism disclosed in Solyntjes into Green’s stapler because of a difference in the physical characteristics of the staplers disclosed by both references.11 The Board found this testimony lacked evidentiary support and was based on speculation that a POSA would be unable to modify Green’s stapler to accommodate Solyntjes’ lockout mechanism.12 Ultimately, the Board credited Dr. Knodel’s testimony over that of Dr. Fronczak, and held that the ’379 patent was invalid on obviousness grounds.13
Federal Circuit Opinion
Ethicon appealed the PTAB decision on grounds that the “Board committed legal error by placing the burden of proof on Ethicon, the patent owner,” and that the “Board’s finding of a reasonable expectation of success in combining the asserted prior art is unsupported by substantial evidence.”14
Regarding Ethicon’s burden-of-proof argument, the Court stated that the “Board should consider the totality of evidence proffered by both parties to resolve any subsidiary factual inquiries,” and the patent owner’s burden to proffer opposing evidence is not eliminated in view of the petitioner’s showing of unpatentability.15 Furthermore, the Court stated that there is no improper shifting of burdens when the Board addressed the patent owner’s counterarguments. The Court relied on Boston Scientific SciMed. v. Iancu16 whereby the Board found that the Petitioner had persuasively met its burden of proof, and then considered the patent owner’s numerous arguments in opposition before concluding that they were insufficient to rebut the strong rationale articulated by Petitioner. In doing so, the Court found that the Board does not shift the burden of proof to the patent owner by considering their counterarguments. See Novo Nordisk A/S v. Caraco Pharm. Labs., Ltd., 719 F.3d 1346, 1353 (Fed. Cir. 2013) (explaining that while “the burden of persuasion remains with the challenger,” this does not “relieve the patentee of any responsibility to set forth evidence in opposition to a challenger’s prima facie case which, if left unrebutted, would be sufficient to establish obviousness”).
As for the Board’s finding of a reasonable expectation of success in combining the asserted prior art, the Court agreed with the Board that a POSA (having a mechanical engineering degree and three years of experience designing surgical instruments) would have a reasonable expectation of success in modifying Green’s stapler to accommodate Solyntjes’ lockout mechanism.17 Contrary to Ethicon’s argument, the Court stated that this is not indicative of an improper burden shift by the Board to the patent owner to establish non-obviousness, as the Board weighed competing evidence and made its determination on the record as a whole.18
The Court also concluded that substantial evidence supports the Board’s finding that a POSA would have a reasonable expectation of success in modifying Green’s stapler to accommodate Solyntjes’ lockout mechanism, based on Dr. Knodel’s expert testimony that such modifications would be routine for a POSA.19 In contrast, the Court noted that Dr. Fronczak’s testimony was discredited by the Board as speculative and unsupported by evidence.20 The Court affirmed the findings of the Board.21
Judge Newman provided a dissenting opinion and argued that the Court improperly engaged in a hindsight analysis using the ’379 patent as a template. Accordingly, the elements of the ’379 patent are found in the prior art references and the panel majority “then plugs into the claims.”22 Judge Newman argued that this type of hindsight analysis was negated by KSR International.23
Moreover, Judge Newman opined that the patentability question is not whether a POSA would be capable of designing the surgical stapler with a lockout feature as required by the ’379 patent, but whether the prior art teaches or suggests the device as a whole.24 Judge Newman stated that it was undisputed that the Solnytjes’ spring-and-pin mechanism is not the spent-cartridge lockout of the ’379 patent and that a combination of Green and Solnytjes does not produced the invention of the ’370 patent.25 As such, there is no teaching or suggestion of the ’379 patent’s structure as a whole.