Fox Factory Inc. v. SRAM LLC
Docket Nos. 2018-2024, -2025 (IPR2017-00118, -00472)
PROST, WALLACH, HUGHES
December 18, 2019
Brief Summary: Board IPR decision of no obviousness vacated and remanded for reevaluation of secondary consideration evidence with respect to the required nexus.
Summary: Fox appealed IPR final decision in which the USPTO (“Board”) finding the challenged claims of SRAM’s US 9,182,027 covering an improved bike chainring not invalid for obviousness. Two IPRs address two different sets of claims, the “outboard offset claims” (-00472 IPR) and the “inboard offset claims” (-00118 IPR), and the Board made similar findings in each decision. The outboard offset claims of the -00472 IPR are addressed in this FC panel opinion. The FC panel opinion explains that two prior art references (“JP-Shimano” and the US “Parachinni” patent) “disclose every limitation…and that a skilled artisan would have been motivated to combine the references…because the skilled artisan would have recognized that the combination of the two features would improve chain retention better than either feature alone.” However, “based on its analysis of secondary considerations”, the Board also found that FOX had not shown obviousness since “SRAM was entitled to a presumption of nexus between the challenged outboard offset claims and secondary considerations evidence pertaining to SRAM’s X-Sync product” but only with respect to “chainrings, not sales or industry praise of X-Sync cranksets or drivetrains”. “FOX argued that SRAM’s products are not coextensive with the challenged claims because the products include numerous unclaimed features”, citing Therasense (Fed. Cir. 2010), but the Board rejected that argument and “determined that FOX could not rebut the nexus presumption”. The FC panel agreed with FOX “that the Board applied the wrong standard”, explaining that while “a patentee is entitled to a rebuttable presumption of nexus” if “the asserted evidence is tied to a specific product and that the product ‘is the invention disclosed and claimed’”, this is not so “if the patented invention is only a component of a commercially successful machine or process” (Demaco, Fed. Cir., 1988; SightSound, Fed. Cir. 2015; Therasense; In re Huang, Fed. Cir. 1996). The FC panel also wrote that it has “never held that the existence of one or more unclaimed features, standing alone, means nexus may not be presumed” as “there is rarely a perfect correspondence between the claimed invention and the product” (“[I]f the unclaimed features amount to nothing more than additional insignificant features, presuming nexus may nevertheless be appropriate.”) Here, the FC panel concluded that “no reasonable fact finder could conclude, under the proper standard, that the X-Sync chainrings are coextensive with the patent claims” or that the differences are “insignificant” and found the Board erred on this point. The FC panel explained that continuation-related evidence is only relevant “if the claims of both patents generally cover the same invention” (WBIP, Fed. Cir. 2016; PPC Broadband, Fed. Cir. 2016). The FC panel affirmed the Board’s conclusions that there was a motivation to combine the references, and found that “FOX did not waive its right to a remand” under SAS (US 2018) because “it filed a motion to remand even before its opening brief was due” (Google LLC, Fed. Cir. 2019).