For Waterproofing Patent, Arguments Against Obviousness Didn’t Hold Water

The Federal Circuit’s decision in Outdry Technologies Corporation, v. Geox S.P.A. discusses some criteria for determining whether or not the explanations provided by the PTAB in an IPR decision are sufficient to support a finding of motivation to combine.

The independent claims of Outdry Technologies Corp.’s US Patent No. 6,855,171 (“the ‘171 patent”) were found to be obvious during IPR proceedings. Outdry’s ‘171 Patent is directed to two claimed processes for waterproofing leather by “directly pressing,” on an internal surface of the leather, a semi-permeable membrane to which a discontinuous pattern of glue dots has been added. One of the claimed leather waterproofing processes of the ‘171 patent requires the glue dots have a particular density. The other requires that the glue dots have a particular size. According to Outdry, directly pressing the glue dot-bearing membrane onto the leather addressed the problem of water pockets forming between the semi-permeable membrane and the leather when only the edges of the semi-permeable membrane are sown or glued to the leather.

In the IPR decision, the PTAB found the claimed leather waterproofing processes of the ‘171 to be obvious in view of US Patents to Thornton and Hayton, and a reference entitled “Chemistry of the Textiles Industry” (“Scott”), each of which discuss using glue dots, or something similar, to adhere a film or waterproof layer to another layer (e.g., a water permeable layer, like leather).  The PTAB determined that the petitioners for the IPR proceedings, Geox, S.p.A., had provided a rational underpinning for combining Scott and Hayton, and that the claimed leather waterproofing processes of the ‘171 Patent would have been obvious in view of Thornton, Hayton and Scott.

Outdry appealed the PTAB’s IPR decision, arguing, among other things, that the motivation to combine Thornton, Scott and Hayton relied upon by the PTAB during the IPR proceedings was insufficient.

In particular, Outdry argued that the PTAB failed to make the required findings supporting the conclusion that a motivation to combine Thornton, Scott and Hayton existed because the PTAB merely relied on Geox’s petition to find a motivation to combine without making its own findings. The CAFC disagreed. The CAFC listed a number of example reasons for which the findings of the PTAB have previously been determined by the CAFC to be insufficient to support a decision that motivation to combine exists, including: failing to cite any evidence, either in the asserted prior-art references or elsewhere in the record, with sufficient specificity for us to determine whether a person of ordinary skill in the art would have been so motivated; merely stating that a combination is “intuitive” or “common sense,” without articulating a rationale; and simply agreeing with arguments in a petitioner’s brief without making any factual findings. However, the CAFC concluded that the PTAB did not make any of the above-referenced errors by articulating, in the IPR decision, Geox’s arguments explaining the motivation to combine the cited references. Further, the CAFC clarified that a PTAB decision that relies on a petitioner’s arguments and includes an explanation supporting the decision to rely on the petitioner’s arguments is acceptable, unlike a PTAB decision that merely adopts a petitioner’s arguments by reference without providing such an explanation.

Outdry also argued that the PTAB’s finding of a motivation to combine was insufficient because the PTAB failed to explain why a person of ordinary skill in the art would be motivated to combine the cited references to solve the water pocket problem addressed by Outdry’s ‘171 Patent. The CAFC was not persuaded by this argument either. The CAFC responded to this argument by citing previous CAFC decisions indicating that a motivation to combine cited references identified in support of a conclusion of obviousness does not have to match a motivation provided by the patent at issue or the patentee.  The CAFC further explained that the identified motivation does not even have to come from the references, themselves.

Accordingly, in Outdry Technologies, the CAFC confirmed that there are standards the PTAB must satisfy when asserting, in an IPR decision, that a motivation to combine exists. Further, the CAFC also explained that these standards are not quite as strict as the Appellant argued they were.