VOLVA PENTA OF THE AMERICAS, LLC V. BRUNSWICK CORPORATION 2022-1765 Decided August 4, 2023

By:  Gene M. Garner II, Partner

Volvo Penta of the Americas, LLC (“Volvo Penta”) appealed from a final written decision of the United States Patent and Trademark Office (“USPTO”) Patent Trial and Appeal Board (“the Board”) holding all claims 1-18 of U.S. Patent No. 9,630,692 (“the ‘692 patent”) unpatentable as obvious.

On August 4, 2023, the CAFC vacated and remanded the final written decisions.

Background

The ‘692 patent is assigned to Volvo Penta and is directed to a tractor-type stern drive for a boat.  A stern drive is also referred to as an “inboard/outboard drive”.  A tractor-type drive refers to one or more forward, bow-facing propellers that pull the boat through the water, and may also be referred to as a “pulling-type” of “forward-facing drive”.

Volvo Penta’s commercial embodiment of the ‘692 patent is referred to as the Forward Drive.  Brunswick Corporation’s (“Brunswick”) drive system that also embodies the ‘692 patent is referred to as Bravo Four S.  Brunswick does not dispute that the Forward Drive and the Bravo Four S both embody the ‘692 patent.

Brunswick launched the Bravo Four S and filed a petition for inter partes review of all claims of the ‘692 patent on the same day.  Brunswick asserted that the claims of the ‘692 patent would have been anticipated or obvious based on Kiekhaefer (U.S. Patent No. 2,616,387, assigned to Brunswick) and Brandt (U.S. Patent No. 4,840,136, assigned to Volvo Penta) and other references.

Kiekhaefer is assigned to Brunswick and is directed to an outboard motor that could have either rear-facing or forward-facing propellers.  Brandt is assigned to Vovlo Penta and is directed to a stern drive with rear-facing propellers.

Arguments Before the Board

Before the Board, Volvo Penta argued that a person of ordinary skill in the art would not have been motivated to combine the references with a reasonable expectation of success and that the objective indicia of nonobviousness overcame any prima facie  case of obviousness.

Volvo Penta offered evidence of six objective indicia:

1. Copying
2. Industry praise
3. Commercial success
4. Skepticism
5. Failure of others
6. Long-felt but unsolved need

Volvo Penta also argued that Volvo Penta was entitled to a presumption of nexus between the objective indicia and the claimed invention, and, even if there was no presumption, that there was still nexus.

While the Board found that Kiekhaefer did not anticipate any claims of the ‘692 patent, the Board found that there was a motivation to combine Kiekhaefer and Brandt based on a sentence in the disclosure of Kiekhaefer, the testimony of a Volvo Penta employee, and the testimony of Brunswick’s expert witness.

The Board then considered Volvo Penta’s arguments on the secondary considerations.  The Board found that Volvo Penta was not entitled to a presumption of nexus since Volvo Penta’s marketing material referred to advantages of the Forward Drive not claimed in the ‘692 patent and Volvo Penta did not identify unique characteristics or merits of the claimed invention.

The Board then considered the above-mentioned six objective indicia.  The Board assigned some weight to (A) copying, (B) industry praise, and (C) commercial success and very little weight to (D) skepticism, (E) failure of others, and (F) long-felt but unsolved need.  The Board also found that Volvo Penta’s objective evidence weighs somewhat in favor of nonobviousness.

However, the Board found that Brunswick’s evidence of obviousness outweighed Volvo Penta’s objective evidence of nonobviousness, and concluded that Brunswick had demonstrated by a preponderance of the evidence that claims 1-18 of the ‘692 patent would have been obvious over Brandt and Kiekhaefer.

Appeal to the CAFC

Volvo Penta then appealed to the CAFC.  In the meantime, Brunswick settled with Volvo Penta and informed the CAFC that Brunswick no longer opposed the appeal and waived its oral argument.

The USPTO intervened and participated in the oral argument.  The USPTO defended the Board’s decision by adopting the arguments of Brunswick.

Discussion by the CAFC

Volvo raised three main arguments:

1. The Board’s finding of motivation to combine was not supported by substantial evidence
2. The Board erred in its determination that there was no nexus
3. The Board erred in its consideration of Volvo Penta’s objective evidence of secondary considerations of nonobviousness

1. Motivation to Combine

The CAFC asserted that “the conclusion of obviousness is a legal determination based on underlying factual findings, including whether or not a relevant artisan would have had a motivation to combine the references in the way required to achieve the claimed invention.”

The CAFC reviewed the Board’s obviousness determination de novo and its factual findings for substantial evidence.

The CAFC found that the Board’s finding of a motivation to combine is supported by substantial evidence.

2. Nexus

The CAFC then considered whether there was a nexus.  The CAFC asserted “For objective evidence of secondary considerations to be relevant, there must be a nexus between the merits of the claimed invention and the objective evidence.”  The CAFC further asserted that “A patent owner is entitled to a presumption of nexus when it shows that the asserted objective evidence is tied to a specific product that ‘embodies the claimed features, and is coextensive with them’”.

The CAFC asserted that “[A]a presumption of nexus requires both that the product embodies the invention and is coextensive with it” (Brown & Williamson, 229 F.3d at 1130).

Neither Volvo Penta nor Brunswick disputes that both the Forward Drive and the Bravo Four S embody the claimed invention.

However, the CAFC asserted that Volvo Penta failed to show coextensiveness between either the Forward Drive or the Bravo Four S and the ‘692 patent claims.  Therefore, the CAFC upheld the Board’s finding that it is insufficient to show a presumption of nexus for the Bravo Four S.

The CAFC then considered whether there was a nexus independently of a presumption.  In that regard, the CAFC asserted that Volvo Penta’s arguments that its evidence of secondary considerations of nonobviousness is the direct result of the unique characteristics of the claimed invention carry more substance.  Volvo argued that Brunswick internal documents tied the success of the Forward Dive to the claims of the ‘692 patent and guided Brunswick to design the Bravo Four S.

The CAFC overturned the Board’s findings and held that there is nexus between the unique features of the claimed invention and the evidence of secondary considerations.

3. Objective Indicia

The CAFC asserted that objective evidence of nonobviousness includes:

1. Copying
2. Industry praise
3. Commercial success
4. Skepticism
5. Failure of others
6. Long-felt but unsolved need

The CAFC then reviewed for substantial evidence the weight to be given to evidence of secondary considerations which involve factual determinations.

The CAFC agreed with Volvo Penta that the Board’s analysis of objective indicia of nonobviousness, including its assignment of weight to different considerations, was overlay vague and ambiguous.

After providing detailed analysis, the CAFC held that the Board failed to properly consider the evidence of objective indicia of nonobviousness.

Therefore, the CAFC vacated and remanded the Board’s decision.

Analysis

A finding of obviousness can be overcome by secondary considerations of copying, industry praise, commercial success, skepticism, failure of others, and long-felt but unsolved need.  These secondary considerations should be considered when challenging rejections based on obviousness.  Internal documents of the maker of the accused device can influence the interpretation of secondary considerations.