Dynamic Drinkware, LLC v. National Graphics, Inc. (Fed. Cir. 2015)

By Andrew Williams --

It is well accepted that in order to establish that a patent is entitled to claim priority to a previously filed provisional application, it must be shown that the claims of the patent have written description support in the provisional.  Indeed, this is what 35 U.S.C. § 119(e)(1) requires:

An application for patent filed under section 111 (a) or section 363 for an invention disclosed in the manner provided by section 112 (a) (other than the requirement to disclose the best mode) in a provisional application filed under section 111 (b), by an inventor or inventors named in the provisional application, shall have the same effect, as to such invention, as though filed on the date of the provisional application filed under section 111 (b) . . . .

It has also been a commonly held belief that for a potentially invalidating prior art reference to be entitled to the filing date of a provisional application, the provisional application itself must contain the same invalidating disclosure.  In other words, it has been believed that if a provisional application contains an invalidating disclosure, any patent claiming priority and containing the same (although not necessarily verbatim) disclosure as that provisional would be prior art as of the provisional filing date.  However, last month, in Dynamic Drinkware, LLC v. National Graphics, Inc., the Federal Circuit explained that we were all doing it wrong.  Instead, just as with any other analysis ascertaining valid priority claims to provisional applications, it is the claims of the relevant patent that are important.  Or, as the Federal Circuit put it "[a] provisional application's effectiveness as prior art depends on its written description support for the claims of the issued patent of which it was a provisional."  Of course, this can create the odd situation (as explained below) where a provisional application contains no disclosure whatsoever related to the patent whose validity is being challenged, but it nevertheless can be used to establish an earlier priority date -- provided the disclosure does support the claims of the invalidating patent reference.

This case arose in the context of an IPR appeal from the Patent Trial and Appeal Board ("Board").  The technology was not particularly important for the issues addressed, but National Graphics' patent (U.S. Patent No. 6,635,196) was directed to making molded plastic articles bearing "lenticular" images.  Lenticular imaging is described on National Graphics website.  Dynamic Drinkware filed an IPR petition asserting that U.S. Patent No. 7,153,555 ("the Raymond patent") anticipated this patent.  The Board ultimately concluded that Dynamic had not meet its burden of establishing by a preponderance of the evidence that two of the claims of the '196 patent were anticipated under § 102(e)(2) because, in part, it did not prove that the Raymond patent was entitled to the provisional application filing date to which it claimed priority ("the Raymond provisional").  Importantly, the Board found it significant that Dynamic only compared a claim of the '196 patent to the Raymond provisional rather than comparing the portions of the Raymond patent relied upon to invalidate the '196 patent to the Raymond provisional.  Then, because the '196 patent claims were found to be reduced to practice between the filing dates of the Raymond provisional and the Raymond patent, the Board concluded that it was not invalidating prior art.

The Federal Circuit first dealt with the issue of who had the burden of establishing either that the Raymond patent was entitled to the prior date of the Raymond provisional, or that the Raymond patent was not entitled to the earlier priority date.  Unsurprisingly, the burden of persuasion in establishing the invalidity of the '196 patent never shifted from the petitioner, Dynamic.  Instead, the relevant issue was the burden of production.  In this case, Dynamic initially asserted that the Raymond patent anticipated certain claims of the '196 patent.  This shifted the burden of production to the patent owner.  National had two options for meeting this burden; either argue that the Raymond patent did not anticipate, or, what National did, that it reduced to practice before the Raymond patent.  Once again, the production burden shifted, this time to Dynamic to prove that the potentially invalidating Raymond patent was entitled to the Raymond provisional filing date.  It did not meet this burden, and therefore did not meet the ultimate burden of proof.

The Federal Circuit pointed out that Dynamic was basically arguing that a patent is presumptively entitled to the priority date of its provisional application.  This cannot be the case because the Patent Office does not routinely examine priority claims made in a patent application.  Only when it is necessary to make such a determination will the patent office do so, such as when an applicant attempts to overcome a prior art reference or in an interference setting.  See M.P.E.P. § 211.05(I)(A).  Therefore, the Federal Circuit concluded, such a presumption is incorrect.

For its part, in arguing this appeal, National argued that Dynamic had waived the argument of the provisional filing date because it was not made in the original petition.  However, the Court pointed out that Dynamic did not need to raise such an argument in the first place, because the Raymond patent was considered to be prior art to the '196 patent until Dynamic established an earlier reduction to practice date.  It was only when the burden of production shifted that Dynamic was required to come forward with the provisional priority date argument.

Finally, as referenced above, Dynamic's argument failed because it improperly made its priority claim to the Raymond patent.  The Court emphasized that "the relevance of the Raymond provisional application date here is not to give the Raymond patent any earlier priority over a competing application or patent, but to serve third party Dynamic's goal of creating earlier prior art against the '196 patent."  Therefore, because Dynamic did not compare the claims of the Raymond patent to the Raymond provisional, it could not prove that the patent was entitled to priority date.

It goes without saying that as a practical consideration, any claim of priority to a provisional should focus of the claims of the patent for which priority is sought.  Of course, it might also be advisable to show where in the provisional the disclosure can be found that is relevant to the patent for which invalidation is sought.  The problem is that a scenario can be envisioned in which a provisional application contains disclosure "A," but a subsequent non-provisional application is filed adding disclosure "B."  This "B" disclosure could be identical to the claims of another patent with an earlier filing date than the non-provisional application.  The prior conventional wisdom was that this non-provisional application (or subsequent patent) could not invalidate this other patent, even if the provisional filing date was earlier, because the provisional did not contain the invalidating "B" disclosure.  According to Dynamic Drinkware, however, if this non-provisional application (or any resulting patent) only contained claims that were supported by disclosure "A," it would nevertheless be anticipatory with regard to the "B" disclosure.  While the potential for mischief on the part of patent applicants is probably minimal, because there is still a one-year deadline for claiming priority to the provisional, it will be interesting to see how this new way of analyzing priority claims will play out.

Dynamic Drinkware, LLC v. National Graphics, Inc. (Fed. Cir. 2015)
Panel: Circuit Judges Lourie, Bryson, and O'Malley
Opinion by Circuit Judge Lourie

Comments

[Kip]

I'm pretty sure that you are misreading the decision.

The decision says that for provisional X to anticipate under 102e, it must result in a publication or patent that:

1. has at least one claim supported by X;
2. contains disclosure (in the spec or claims) that anticipates the patent under review

In other words, you need both 1 and 2 for the argument to work. I believe this has actually been the law pre-AIA for decades. Hal Wegner and Chisum have material about this. Whether or not this is still the law post-AIA is an open question depending on the interpretation of new 102(d).

Your contrary argument here is that the later prior art publication can invalidate if only 1 is satisfied, even if 2 is not satisfied. I'm pretty sure that is incorrect (and quite unfair as a matter of policy).

[Skeptical]

I am not seeing any strangeness - GIVEN the starting point of:

"provided the [provisional] disclosure does support the [non-provisional] claims of the invalidating patent reference."

where exactly is the problem?

[Andrew Williams]

Dear Kip,

Thank you for your comment. I agree that my scenario would be unfair as a matter of policy. And I agree that the rule should be that you need both 1 and 2 as you describe it (that you need support for the claim, and support in the disclosure), and in fact I suggested that practitioner provide support for both as a best practice. I also agree that this only necessarily applies to pre-AIA 102 (footnote 2 highlights this). However, I cannot find anything in this decision that supports your position for requiring anticipatory support in the specification. Indeed, the decision reads: “A reference patent is only entitled to claim the benefit of the filing date of its provisional application is the disclosure of the provisional application provides support for the claims in the reference patent in compliance with § 112, ¶ 1.” In addition, the Court indicated:

“Nowhere, however, does Dynamic demonstrate support in the Raymond provisional application for the claims of the Raymond patent. That was Dynamic’s burden. A provisional application’s effectiveness as prior art depends on its written description support for the claims of the issued patent of which it was a provisional. Dynamic did not make that showing.”

(emphasis in original). The decision does acknowledge that Dynamic provided claim charts related to the disclosure of the provisional, and it therefore could be argued that it was implicitly suggesting that such was required (and that it need not say anymore on the matter). However, the decision does not indicate such a showing is required (and in fact appears to suggest the opposite). If you still disagree, please let me know where you think support for your reading can be found in the decision. I hope that my scenario is inaccurate, because as you said, it would be extremely unfair.

Andrew

[EG]

Andrew,

I agree with Kip that you're misreading the Drinkware decision. What the Federal Circuit says in the quoted statement is that Drinkware failed to show that any of the Raymond provisional disclosure provided "written description" support for any of the issued Raymond patent claims. In other words, Drinkware had failed to establish the required 119(e) priority to the Raymond provisional for the Raymond patent. Once it's shown that any of the Raymond provisional disclosure provided "written description" support for any of the issued Raymond patent claims, that 119(e) priority would then be established, and all of the disclosure in the Raymond provisional, whether or not required to provide "written description" support would be available as prior art as of the Raymond provisional filing date.

[Dan Williams]

Andrew and Kip,

Using Kip's formulation above, it seems to me that the right reading of this case is that (i) you need both 1 and 2 and (ii) in this case, Dynamic only proved 2 and ignored 1.

I think that the panel could have been a little clearer. The panel essentially said "Dynamic didn't show 1, so they lose," from which it could be concluded out of context that 1 is the only test. What they really were saying in my opinion was "(you need both 1 and 2, and even though Dynamic proved 2), Dynamic didn't show 1, so they lose."

I can't say for certain what the accepted law on this point was before this case, but I think that this case will be news to many practitioners that a comparison needs to be made between a potential prior art reference's claims and that potential prior art reference's provisional disclosure, irrespective of whether that aspect of the provisional disclosure is relevant to the claim being examined or litigated.

This also brings to my mind an interesting question about 102(e) as it applies to published applications potentially being prior art as of their provisional's filing date, since the claims of a published application have pretty limited legal effect. It seems according to this case that you could have a published application with a single claim that is clearly never going to be allowed, and as long as that single claim is supported in the published application's provisional filing, the rest of that provisional's disclosure is fair game as prior art against other claims. Seems to me like part 1 of this test is more form over substance.

Dan

[Kip]

Hi Andrew,

The support for my interpretation is found in the following sources:

http://www.laipla.net/dynamic-drinkware-v-national-graphics-%C2%A7-102e-parent-patent-defeating-date-denied-burden-of-proof/

You can also google "hal wegner drinkware" to find more material. See also this blog post:

http://www.patentspostgrant.com/cafc-finds-prior-art-status-of-patent-depends-on-claim-scope

The argument here is based on the In re
Wertheim decision. Essentially, the CAFC just applied that decision to this case, without creating new law.

See also Chisum's discussion of Wertheim in pages 39-43 of this SSRN article:

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1969592

You write that: "I cannot find anything in this decision that supports your position for requiring anticipatory support in the specification."

Well, the support comes from 35 USC 102(a)(2) and other case law. It is also common sense. I would frame the issue like this: there are two requirements for prior art in these situations (1) priority and (2) disclosure. In the Drinkware decision, (1) is challenged based on the technicality of the Wertheim decision. Because (1) was at issue, the court does not discuss (2) much. But that does not mean that (2) is not also a requirement. If both are necessary, then a party only needs to defeat one to overcome the reference.

[Andrew Williams]

Kip, Eric, and Dan - I'm preparing a follow-up post in which I will highlight this discussion. I think this discussion is too important to remain in the comments. I will include some of the points that have been made here. While I may disagree on some points, I agree on others, and I respect everyone's opinion. If for some reason you do not want me to include your name, please let me know (although I assume it is OK, considering you included it here). Thanks.

Andrew