USPTO Publishes Updated Guidance for Making Proper Obviousness Determinations

By Michael Borella --

On February 27, 2024, the U.S. Patent and Trademark Office published its Updated Guidance for Making a Proper Determination of Obviousness ("Guidance") in the Federal Register.  The stated goal of the Guidance is:

To provide a review of the flexible approach to determining obviousness that is required by KSR Int'l Co. v. Teleflex Inc. (KSR).  The focus of this document is on post-KSR precedential cases of the United States Court of Appeals for the Federal Circuit (Federal Circuit), to provide further clarification for decision-makers on how the Supreme Court's directives should be applied.

At first blush, the Guidance appears to be merely restating the law and one might be inclined to think that it is much ado about nothing.  However, the Guidance is notable for what it does not cover and may actually lead to its intended audience (mainly examiners and PTAB judges) being more likely to find claims obvious and raising the bar on applicant rebuttals of obviousness contentions.

Put another way, the Guidance sets forth a number of legal principles that could result in examiners believing that they should issue more obviousness rejections.  But it does not acknowledge or even mention that examiners commonly and frequently misapply the law and facts when doing so.  Thus, the Guidance is -- at best -- one-sided in this regard and may result in more time and expense for applicants.

The Guidance states that it "is based on the Office's current understanding of the law and is believed to comport with the binding precedent of the Supreme Court and the Federal Circuit . . . [and] is meant to be consistent with the Office's present examination policy."  It is expected that the Guidance will be incorporated into an updated version of the Manual of Patent Examining Procedure (M.P.E.P.).

One tangential point that the Guidance notes is that the America Invents Act (AIA) changed "the time focus of the obviousness inquiry from 'at the time the invention was made' to 'before the effective filing date of the claimed invention.'"  The Guidance instructs USPTO personnel to "interpret references to 'at the time of invention' in KSR . . . as if they referred to the statutory time focus under the AIA."  Presumably, USPTO personnel should do the same with any use of the term "at the time of the invention" in other cases and in Applicants' comments for purposes of consistency, though such a directive is not made.  Nonetheless, this seems to be a minor clarification that is unlikely to lead to a substantive change in examination.

The Guidance goes on to reiterate that KSR affirmed that the factors set forth in Graham v. John Deere Co. still control the obviousness inquiry.  These factors require that "differences between the prior art and the claims at issue are to be ascertained; and the level of ordinary skill in the pertinent art resolved."  Here, the USPTO missed an opportunity to advise examiners to explicitly state their interpretation of the differences (which sometimes is missing in obviousness rejections) and their understanding of the level of ordinary skill in the art (which is almost never mentioned in obviousness rejections).

More substantively, the main theme of the Guidance is that KSR set forth a flexible rather than robotic obviousness test.  The Guidance states that this flexibility has two aspects, "first with regard to the proper understanding of the scope of the prior art, and second with regard to appropriate reasons to modify the prior art."

On these points, the Guidance asserts that "a proper understanding of the prior art extends to all that the art reasonably suggests, and is not limited to its articulated teachings regarding how to solve the particular technological problem with which the art was primarily concerned."  This requires understanding the prior art "in a flexible manner that credits the common sense and common knowledge of a [person having ordinary skill in the art (PHOSITA)]."

According to the Guidance this means that "[a]n argument that the prior art lacks a specific teaching will not be sufficient to overcome an obviousness rejection when the allegedly missing teaching would have been understood by a PHOSITA—by way of common sense, common knowledge generally, or common knowledge in the relevant art."  The Guidance goes on to give examples from the case law that reject a rigid approach to obviousness and properly combine prior art elements without an express teaching to do so.

The problem here is that the Guidance is silent as to how an examiner is supposed to determine the understanding of a PHOSITA or even the proper level of ordinary skill in the art.  As noted above, such determinations are rarely made explicit in office actions.  And, even when they are explicit, the rationale provided by examiners is often conclusory with little or no supportive reasoning.

The Guidance goes on to note that "the flexible approach to obviousness encompasses not only how to understand the scope of prior art, but also how to provide a reasoned explanation to support a conclusion that claims would have been obvious."  Thus, there are "numerous possible sources that may, either implicitly or explicitly, provide reasons to combine or modify, the prior art to determine that a claimed invention would have been obvious."  As a notable example, a so-called "universal" type of improvement to improve system performance may exist "even absent any hint of suggestion in the references themselves."

The concern with this language is that examiners will use it to justify poorly-reasoned, hand-waving contentions involving uses, modifications, and combinations of prior art.  These concerns are somewhat addressed by the Guidance reiterating that "a proper obviousness rejection still requires the decision-maker to provide adequate analysis based on evidentiary support."  In other words, "Office personnel are required to provide a clear articulation of their reasoning, grounded in relevant facts, when making a determination that a claim would have been obvious."  Having said that, it is rare for said personnel to admit that their articulations have not been clear and the guidance provides little criteria for determining whether an obviousness rejection meets this requirement.

Along similar lines, the Guidance states that "[i]f objective indicia of nonobviousness are properly before the examiner, such as by way of incorporation into the written description as filed or submission of an evidentiary declaration after the filing date, the examiner must consider those indicia, even before the issuance of a first Office action."  While a well-drafted patent application may point out differences between the claimed invention and the prior art known to the applicant, it is not clear in examination procedures whether and to what extent such statements have been considered by examiners.  There currently is no requirement for examiners to make such considerations on the record.

Other issues addressed by the Guidance include the use of common sense by a PHOSITA and how to evaluate the weight of expert opinions.

Notably missing from the Guidance is any example of what a sufficient obviousness rejection would look like in practice.  It would have been helpful for the USPTO to provide examples of properly-reasoned as well as improperly-reasoned obviousness rejections.  As it stands, such details are not present, which may incentivize examiners to continue taking short cuts.

At the very least, the Guidance should have called out a few of the most common and problematic types of examiner errors.  These include <ctrl>-F rejections (the examiner finds the words of the claims in prior art references and does not consider that the words may have multiple meanings or are used in a different context), overreliance on broadest reasonable interpretation (the examiner ignores how a claim term is used in the claim and/or defined in the specification), low-effort rejections of dependent claims (the examiner uses the same references to reject all dependent claims even if those references do not teach the specific elements of those claims), the Where's Waldo rejection (the examiner essentially cites an entire reference -- perhaps dozens of pages long -- and merely tells the applicant that the claim element in question is "in there somewhere"), the "expert" examiner (the examiner claims, without any evidentiary support, that the claim element would be well-known to a PHOSITA because the examiner considers themself an expert in the field), and the ghost claim element (an element that is explicitly recited in a claim that the examiner completely and utterly fails to address).  These are just a few examples.

The point is that the USPTO needs to crack down on examiners taking liberty with lazy examination practices.  Along with the Guidance's discussion of the flexibility the obviousness analysis should be a further and more detailed discussion of how to apply it properly.

Another aspect missing from the Guidance is an acknowledgement that there is a line of Federal Circuit cases that put a fence around overly broad motivations to combine prior art references.  Notably, in Belden Inc. v. Berk-Tek LLC, the Court wrote that "obviousness concerns whether a skilled artisan not only could have made but would have been motivated to make the combinations or modifications of prior art to arrive at the claimed invention" (emphasis added).  Similar language can be found in Personal Web Techs., LLC v. Apple, Inc. and In re NuVasive, Inc. in other words, it is not enough for an examiner to contend that references X and Y could be theoretically combined in some fashion.  Instead, the prima facie burden on the examiner is to establish that a PHOSITA would have been motivated to combine references X and Y in a manner that results what is being claimed by the applicant.

In short, nobody is perfect.  Examiners are human.  Most are not attorneys.  They will make mistakes when applying the law of obviousness.  The USPTO, however, seems content to stick its head in the sand regarding some of the more common and egregious examiner errors that can be found in obviousness rejections without even looking that hard.

If nothing else, the USPTO should be looking closely at examiners who have very high or very low allowance rates in comparison to their art unit or technical center peers as ones that potentially are misapplying the law of obviousness.  The USPTO should also be looking at examiners who are frequently reversed during any stage of the appeals process (e.g., on a pre-appeal brief or PTAB decision) as also potentially misapplying this law.  These individuals should be targeted for additional training on how and how not to employ the obviousness inquiry.

Comments

[Max Drei]

Îs not the interesting question in the obviousness enquiry how much Examiner reasoning is needed, both in theory and in practice, to shift over to the Applicant the burden of proving patentability?

[skeptical]

That burden never shifts Max Drei.

The burden that shifts is one of refuting (if established) the procedural stance of the prima facie case.

There is a critical legal distinction here.