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CAFC Weekly: August 20, 2010

by Orlando Lopez

The two precedential opinions issued this week considered the effect of secondary considerations of obviousness, with a different result in each. One of the opinions also includes a discussion on whether a sale negotiated outside of the US between two US companies and for delivery of the product in the US, can constitute infringement.

In Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc., Transocean owns three patents for improved components for offshore drilling, and sued Maersk for infringement based on a contract with a U.S. company for building the accused Maersk drilling rig. The accused Maersk drilling rig, once built, was to be used in the Gulf of Mexico. The contract was on offer for sale, which is an infringing act, but was signed in Norway. The District Court granted summary judgment in favor of Maersk for non-infringement and for invalidity, due to obviousness and lack of enablement. Regarding obviousness, the CAFC reversed the decision of the District Court because, while Maersk had presented a prima facie case of obviousness, the District Court did not consider secondary considerations of non-obviousness (industry skepticism as to whether the invention was possible and industry praise for the invention) raised by Transocean. The CAFC held that a contract between two US companies, for sale of an infringing product where delivery and performance of the contract occurs in the US, is an act of infringement and thereby vacated the judgment of non-infringement. Additionally, the CAFC stated that where the contract was signed does not completely determine the location of the occurrence of infringement. In regards to enablement, the CAFC found that there were disputed facts regarding whether excessive experimentation was needed for one skilled in the art to practice the invention.

In Geo. M. Martin Co., v. Alliance Machine Systems Int’l LLC, the CAFC affirmed a judgment of invalidity due to non-obviousness, even though Martin had argued that secondary considerations of non-obviousness prevented a determination that the claims were obvious. The CAFC based their decision on the fact that secondary considerations were not completely due to the claimed invention, but could have been due to Martin’s market share. The patent at issue relates to a machine for separating stacked sheets of corrugated board. The District Court trial for patent infringement resulted in a hung jury, and the Court ruled as a matter of law that the patent was invalid due to obviousness.

When reviewing the different results of these two cases in regards to secondary considerations of non-obviousness, it has to be taken into consideration that in Transocean the CAFC was reviewing a grant of a motion of summary judgment, and not taking into consideration secondary indicia of non-obviousness would result in there being disputed facts.

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