Claimed Ranges Overlapping with Prior Art Shift Burden of Production to Patent Owner

Since the Federal Circuit’s decision in Magnum Oil, the Patent Trial & Appeal Board (PTAB) has been mindful that the ultimate burden of persuasion must remain with the patent challenger. While this general rule guides most proceedings at the PTAB, as the Federal Circuit reminded the Board today, there are exceptions for the burden of production.

In E.I. Dupont De Nemours v. Synvina C.V. the Court considered whether a claimed range shown to be overlapping with that of the prior art creates a rebuttable presumption of obviousness. The Court reiterated that it did, and that once an overlap is shown by a Petitioner, it falls to the Patent Owner to come forward with appropriate rebuttal evidence.

At issue in Dupont was the reaction conditions for a certain oxidation process (5-hydroxymethylfurfural (HMF)).

At trial, the Petitioner demonstrated the claimed ranges of temperature, pressure, etc as overlapping with that of the prior art.  In its Final Written Decision (FWD) the Board acknowledged the claimed overlap in the art, but found that the Petitioner had not proven the conditions to be result-effective variables.  Moreover, citing to Magnum and Dynamic Drinkware, it explained that there could be no burden shifting in IPR even though Patent Owner had failed to prove unexpected results, criticality, or lung, unfelt need.  Petitioner appealed arguing that it had proven the conditions to be result-effective variables, and that the Board was incorrectly construing the Court’s precedent on burden shifting.

The Federal Circuit reversed the Board (here), explaining:

The legal principle at issue in this case is old. For decades, this court and its predecessor have recognized that “where the general conditions of a claim are disclosed in the prior art, it is not inventive to discover the optimum or workable ranges by routine experimentation.” Thus, normally, it is to be expected that a change in temperature, or in concentration, or in both, would be an unpatentable modification. A more specific application of this general principle is that a prima facie case of obviousness typically exists when the ranges of a claimed composition overlap the ranges disclosed in the prior art. We have said that such overlap creates a presumption of obviousness.

There are several ways by which the patentee may rebut that presumption .  .   . and none of the means for rebutting [have been] shown.

(internal citations and quotations omitted)

As to the Board’s insistence that Magnum Oil was controlling, the Court explained:

[T]he Board interpreted two more recent cases, Dynamic Drinkware and Magnum Oil, as prohibiting any burden-shifting framework from applying in an IPR. The Board erred, as these two cases did not overturn the procedural scheme for overlapping range cases.

Neither Dynamic Drinkware nor Magnum Oil involved overlapping ranges. The issue in Dynamic Drinkware was the allocation of the burdens of persuasion and production for anticipation and entitlement to an earlier priority date in an IPR.  We held that the IPR petitioner had the burden of persuasion to prove unpatentability by a preponderance of the evidence, and this burden never shifted.  The burden of production, however, could shift with respect to the presentation of evidence of anticipation or priority date.  While we recognized that different evidentiary standards applied between district court litigation and IPRs, that difference did not alter the shifting burdens between the parties because in both a district court case and an IPR the patent challenger has the burden of proving unpatentability.  In other words, we applied consistent procedural schemes between district court litigation and IPRs, as the only relevant difference was in the quantum of evidence necessary to prove unpatentability.

In Magnum Oil, we rejected the PTO’s argument that when the Board institutes IPR, and so concludes the petitioner has met the “reasonable likelihood of success” standard, that conclusion operates to shift the burden of producing evidence of nonobviousness to the patentee.  We observed that there was no dispute that the burden of persuasion remained with the patent challenger. Although we recognized that the burden of production may shift in certain circumstances in an IPR, (discussing Dynamic Drinkware), we held that this burden did not shift to the patentee to generally prove nonobviousness following institution. As in Dynamic Drinkware, we did not discuss our case law concerning overlapping ranges or the procedural framework relating to them.

[Patent Owner] points to broader statements in Magnum Oil purportedly in tension with applying any burden shifting framework in the obviousness context. (“Where, as here, the only question presented is whether due consideration of the four Graham factors renders a claim or claims obvious, no burden shifts from the patent challenger to the patentee.”)). But such general statements must be interpreted in context, as must the specific question we address here. The point of our overlapping range cases is that, in the absence of evidence indicating that there is something special or critical about the claimed range, an overlap suffices to show that the claimed range was disclosed in—and therefore obvious in light of—the prior art. Our use of the term “presumption” or the phrase “burden-shifting framework” is merely a recognition of the practical reality that a patent challenger would have every incentive to point out the existence of an overlapping range, and virtually none to differentiate the claimed range from what was disclosed in the prior art. Importantly, the language employed in our overlapping range cases does not shift the burden of persuasion to the patentee to prove nonobviousness by, for example, pointing to evidence of criticality or unexpected results. All our case law states is that, absent a reason to conclude otherwise, a factfinder is justified in concluding that a disclosed range does just that—discloses the entire range.

While a patentee technically has no “burden” to do anything to defend the validity of its patent other than hold the patent challenger to its own burden of persuasion, that burden of persuasion is necessarily satisfied when there is no evidentiary reason to question the prior art’s disclosure of a claimed range. Magnum Oil is not to the contrary.

(internal citations and quotations omitted)

The Federal Circuit faulted the Board’ analysis of “result-effective variable” as well.  Explaining that only a known relationship need be shown in the art with respect to the variables, not that the claimed range be necessarily required by the art.

The Board’s decision was reversed based upon the Court’s view that the record demonstrated an overlap in ranges of result-effective variables.