In Rembrandt Diagnostics, LP v. Alere, Inc. 2021-1796 (Fed. Cir. Aug. 11, 2023), the decision addresses the Patent Trial and Appeal Board's obviousness determinations in an Inter Partes Review proceeding (IPR2016-01502), where the Board held the claims in the challenged patents unpatentable as obvious in view of the asserted prior art.
Background
The dispute began in 2016 when Rembrandt sued Alere in district court for patent infringement. After Rembrandt sued, Alere filed an IPR petition challenging claims 1–6 and 9–15 of U.S. Patent No. 6,548,019 ("the '019 patent"), which is directed to test assay devices and methods for testing biological fluids. Alere argued the challenged claims would have been obvious over two combinations of prior art patents relating to assay testing devices: (1) U.S. Patent No. 5,656,502 ("MacKay") in view of U.S. Patent No. 5,985,675 ("Charm") or U.S. Patent No. 5,602,040 ("May") and (2) U.S. Patent No. 6,379,620 ("Tydings") in view of MacKay or U.S. Patent No. 5,500,375 ("Lee-Own").
The Board issued a final written decision ("FWD") in February 2018, finding that while MacKay anticipated claim 2, Alere failed to prove claims 3–5 were unpatentable. Alere appealed and the Federal Circuit affirmed the Board's claim construction but remanded for the Board to consider all the challenged claims and grounds under SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018).
On remand, Alere filed a reply with an accompanying declaration from its expert, Dr. Robert Bohannon, responding both to Rembrandt's arguments and to the observations the Board raised in its original institution decision. In February 2021, the Board issued its post-FWD decision finding claims 2–6 and 10 unpatentable. Rembrandt appealed, arguing that the Board erred by relying on Alere's new theories asserted for the first time in its reply brief. The appeal focused on claims 3–6 and 10.
Issue(s)
Whether the Board abused its discretion when it allegedly relied on Alere's new theories and evidence, and whether substantial evidence supports the Board's factual findings.
Holding
The Federal Circuit affirmed the Board's decision.
Reasoning
Regarding the first issue—Alere's new theories—the Federal Circuit agreed with Alere that Rembrandt forfeited its argument that Alere offered new theories. Rembrandt contended that it objected to the IPR grounds on the first page of its brief where it stated that Alere "resorts to new theories in reply." The Federal Circuit first addressed Rembrandt's objection and held its generic objection was insufficient to constitute a proper objection—especially because Rembrandt expressly objected to other allegedly new theories without doing so for the theory in dispute. The Federal Circuit noted that it would be unfair to both the parties and the Board to read so broadly such a generic objection, when neither would have adequate notice of which theories are allegedly new. The Court noted this would be particularly problematic for the Board, as it "must make judgments about when a reply contention crosses the line from the responsive to the new."
The Federal Circuit next addressed Rembradnt's new-theories argument. Regarding claim 10, the Court found that Alere's reply argument discussing cost and time savings had a nexus to Rembrandt's prior argument and was responsive. The Court further found that by discussing time and cost savings as a form of efficiency, the reply also properly expands on and is a fair extension of Alere's previously raised efficiency argument. Regarding claims 3–6, the Federal Circuit found that Alere's reply argument was responsive to Rembrandt's arguments and the Board's observations. Namely, merely Alere disputed Rembrandt's contention that wicking material is fundamental to Tydings and explained that removing wicking material would further achieve Tydings' goals of inexpensive and easy manufacturing. In short, as the Court concluded, Alere's responsive reply arguments do not constitute new theories, and the Board did not abuse its discretion in considering them.
Regarding the second issue—substantial evidence—Rembrandt asserted that for MacKay in view of Charm or May, the references' disclosures fail to support the Board's finding that MacKay, Charm, or May accommodate multiple test strips. The Federal Circuit found Rembrandt's arguments center on the interpretation of disclosures from the prior art and the presence of motivation to combine. The Court noted that Rembrandt "cite[d] to no counter testimony from a qualified declarant to refute [Alere's expert]'s conclusions regarding how a skilled artisan could have interpreted the identified disclosures." The Court noted, based on its review of the record—particularly the express disclosure in the prior art and Alere's expert's credible testimony—there is evidence that "a reasonable mind might accept" "as adequate to support" the Board's factual findings. The Court reasoned that the Board was presented with "two alternative theories" about what the prior art discloses, and it is not the Federal Circuit's task "to determine which theory we find more compelling." Thus, the Court held the Board's obviousness determinations are supported by substantial evidence.
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