Patent Law

Muniauction, Inc. v. Thomson Corp. and I-Deal (Fed. Cir. 2008) (Part II)

[Read Part I discussing joint infringement]

Muniauction's patent relates to municipal bond auctions. During cross examination at trial, Muni's expert admitted that two of the claims were identical to the prior art except for the patentee's use of a web browser to access the auction. Despite that admission, the Pittsburgh jury refused to invalidate the patent leading to an award of $77 million for willful infringement. On appeal, the CAFC reversed ? finding the claimed invention obvious.

No Obvious Deference: Like claim construction, obviousness is a question of law that is reviewed de novo on appeal. Despite that similarity, obviousness is normally decided by a jury. This difference is justified by the relatively small number of "underlying facts" in contention during claim construction as compared with plethora of factual issues that build up to a conclusion of obviousness. As the CAFC explained in the 2007 Dippin' Dots opinion, "[t]hose factual underpinnings include the scope and content of the prior art, differences between the prior art and the claims at issue, and the level of ordinary skill in the art."

Here, the court cited KSR to hold ? as a matter of law ? that the Muniauction improvement was nothing "more than the predictable use of prior art elements according to their established function."

Broad Claims Create Trouble for Secondary Factors: Broadly written claims increase the chance that some prior art will be found to invalidate the claimed property right. Here, the CAFC also found that broad claims make it difficult to use secondary factors of patentability to establish nonobviousness. The particular issue here is that a tight nexus must link the claimed invention to the secondary factors (such as long felt need & market success).

"[C]ommercial success or other secondary considerations may presumptively be attributed to the patented invention only where 'the marketed product embodies the claimed features, and is coextensive with them.'" Quoting Ormco v. Align.

Muni showed success of its products. However, the reports of success focused only on one portion of the invention as claimed. The appellate panel compared those narrow reports of success with the broad claims ? finding that the success "lacks the required nexus with the scope of the claims."