Patent Law | Expert Legal Commentary
May 12, 2009
Rothman v. Target: Deferring to Jury Finding of Obviousness, But Not of Inequitable Conduct
Rothman v. Target Corp.
Yuri Mikulka of Stradling Yocca Carlson & Rauth and Spyros Lazaris
In Rothman v. Target Corp., 556 F.3d 1310 (Fed. Cir. 2009), the Federal Circuit upheld a district court’s refusal to set aside a jury finding that the plaintiff’s patent was invalid due to obviousness, but reversed the trial court on its finding of inequitable conduct by the prosecuting attorney. The court showed high deference to the jury on the former issue, but determined that “no reasonable jury” could have found inequitable conduct on the latter issue. Arguably, the court’s holding could be construed as inappropriately broadening the concept of obviousness, though it does make a point of protecting the good faith efforts of prosecuting attorneys.
Shortly after plaintiff Rothman had her first child in March 2000, she looked for a nursing top that would cover her stomach while providing easy nursing access. Unable to find such a top, she sewed one together herself by combining parts of existing clothing items and extra fabric. She filed a patent application on the end product called the “Topless Topnotch Nursing Top” and formed a company called “Glamourmom” to produce, market, and sell the top.
In June 2002, Glamourmom began discussions with manufacturer Leading Lady about having Leading Lady manufacture and sell Rothman’s nursing tops; Glamourmom sent Leading Lady a sample the following month. Leading Lady apparently used the sample to create a deal with Target stores to supply nursing tank top. After that deal, Leading Lady entered into licensing negotiations with Glamourmom in March 2003, with the Target agreement on the table.
But in July 2003, the negotiations broke down. Leading Lady sent Glamourmom’s attorney a sample of an undated and undocumented garment identified Leading Lady style 438 —a sports nursing bra, not a full tank top. Thereafter, Leading Lady formally cut off the negotiations, informing Glamourmom that it intended to go to market with its own nursing tank top design – Leading Lady style 460, which it developed after becoming aware of Glamourmom’s design. Leading Lady claimed that its styles 438 and 460 were essentially the same product, with only slight modifications. It also claimed that the Target deal was based on style 460, not the Glamourmom product.
Glamourmom’s attorney disputed the relevance and applicability of style 438 to the Glamourmom tank top and offered to continue discussions with Leading Lady. The attorney also filed a “Petition to Make Special” with the Patent and Trademark Office to expedite review of Rothman’s patent application, attaching the Leading Lady correspondence, though he did not report Leading Lady styles 438 and 460 to the PTO as prior art.
Glamourmom’s patent issued on February 15, 2005, and it filed this lawsuit alleging infringement by the defendants on October 7, 2005. The defendants denied the infringement allegations and claimed that the patent was invalid due to anticipation and obviousness. The defendants also alleged inequitable conduct by Glamourmom’s attorney during the prosecution process.
After a 10-day jury trial, the jury concluded that the defendants’ products did infringe Glamourmom’s patent. However, the jury also found that the patent was invalid due to anticipation and obviousness, and the jury further agreed with the defendants’ inequitable conduct allegations. The district court refused to set aside the jury’s findings and Glamourmom filed this appeal. Rothman v. Target Corp., 556 F.3d 1310 (Fed. Cir. 2009).
Technical expert’s lack of personal inventiveness is not proof of nonobviousness
After explaining its deferential role vis-à-vis the jury finding, the Federal Circuit, in an opinion authored by Judge Randall Rader, addressed and upheld the jury’s finding of obviousness. Specifically, the court pointed to Leading Lady’s technical expert, who admitted that Glamourmom’s invention was not “imaginable” to him at the time of the invention, and that neither the idea nor the consumer need occurred to him at the time. Glamourmom pointed to this “admission” as proof that its design was not obvious to a person of ordinary skill in the art at the time of the invention.
The Federal Circuit determined that a reasonable jury could have discounted this technical expert’s testimony as merely an admission that he personally did not conceive of the idea, rather than treating it as an indication of general nonobviousness. The Court wrote that the expert’s testimony “regarding his own inventive feats has little relevance to whether Rothman’s invention would have been obvious to a hypothetical person of ordinary skill in the field with attributed knowledge of the relevant prior art.” 556 F.3d at 1318.
The Court went on to find that Glamourmom’s invention “falls into a very predictable field…. Nursing garment design is a predictable art.” Id. at 1319. The court based this finding primarily on Rothman’s own testimony, in which she claimed that she quickly whipped the garment together herself combining existing off-the-shelf products. The court wrote that “in this case… the inventive process shows the predictability and expectations in this field of art.”
The Court also pointed to the testimony of both the technical expert referenced above, as well as the woman who created Leading Lady’s style 460, who the defendants claimed was a “person of ordinary skill” in the field. Both testified that Rothman’s design – particularly her combining two existing garments—was easy and predictable, and completely informed by the prior art. Id. at 1320.
Based on the cumulative evidence, the Court found that the jury’s finding of obvious was reasonable and appropriate, despite the technical expert’s lack of personal inventiveness, and upheld the finding that the patent was invalid for obviousness. Accordingly, the court did not need to address the other validity or infringement arguments.
The weight of secondary considerations depends on the strength of the primary evidence of obviousness
Glamourmom asserted that secondary considerations – the industry’s willnessness to license the design, its commercial success, praise for the invention, and copying of the design by the defendants—support its claim of nonobviousness. Glamourmom argued that the jury’s finding of obviousness was “highly contrary to the record evidence and lack(s) any reasonable support.” Id. at 1322.
But the Court disagreed, stating that “a strong prima facie obviousness showing may stand even in the face of considerable evidence of secondary considerations.” Id. Because the trial court had instructed the jury on the importance of secondary considerations, the Court wrote that it “must presume that the jury adequately weighed this factual evidence and found it insufficient to support a finding of validity.” Id.
The Court defers to the prosecuting attorney on the inequitable conduct claims
Even though the Court strongly deferred to the jury’s finding on the obviousness question, it did not similarly defer to the jury on its findings of inequitable conduct by Glamourmom’s prosecuting attorney. The Court noted that typically (and preferably), inequitable conduct questions are handled by a judge, not a jury, but that in this case, the parties agreed to submit the questions to the jury. Id. at 1322-1323.
“To prevail on an inequitable conduct charge, a defendant must present ‘evidence that the applicant (1) made an affirmative misrepresentation of material fact, failed to disclose material information, or submitted false material information, and (2) intended to deceive the (PTO)’” Id. at 1323, citing Cargill Inc. v. Canbra Foods Ltd., 476 F.3d 1359, 1363 (Fed. Cir. 2007). Both elements must be proved by clear and convincing evidence. Id.
In this case, the defendants first alleged that Glamourmom engaged in inequitable conduct by withholding Leading Lady style 438 from the PTO as prior art after becoming aware of it. The court found, however, that Glamourmom had disclosed numerous nursing bras in its patent application, and that style 438 was therefore immaterial because it was cumulative of information already before the PTO. Id. at 1326-1327. Due to the “uncontested similarities between Leading Lady style 438 and the numerous garments (Glamourmom) disclosed to the PTO… no reasonable jury could have found style 438 material. Therefore, no reasonable jury could have relied on that garment to support a finding of inequitable conduct.” Id. at 1327.
The defendants also alleged that Glamourmom engaged in inequitable conduct when it failed to disclose Leading Lady style 460 to the PTO. The Court also rejected this argument, finding that Glamourmom’s submission of the letter exchange between it and Leading Lady regarding style 460 were sufficient to show that Glamourmom’s attorney did not act with bad faith or an intent to deceive. The court wrote: “Receipt of threatening letters containing vague descriptions of unsubstantiated prior art at the tail end of a souring business relationship does not create an automatic duty of disclosure… Otherwise every potential patent licensee (and potential infringer) could subject a patent applicant to the possibility of inequitable conduct sanctions on a whim.” Id. at 1327.
The Court went further and suggested that it was Leading Lady, not Glamourmom, that had acted in bad faith: “Leading Lady had Glamourmom’s sample product in its possession for a year before it ever informed Glamourmom of the existence of style 460. Indeed, even though style 460 is purportedly prior art to the (Glamourmom) patent, Leading Lady nevertheless engaged Glamourmom in licensing negotiations for the rights to the [Glamourmom] patent before it issued. Then, seemingly overnight, Leading Lady morphed from interested suitor offering favorable royalty terms and expressing assurance of ‘strong initial business’ with a major retailer to a patent-eviscerating prior art holder. This course of conduct suggests… that Leading Lady acted in bad faith.” Id.
Finally, the defendants alleged that Glamourmom’s attorney engaged in inequitable conduct when he told the PTO examiner that nursing garments were specialized garments, different from other women’s garments – the defendants claim the attorney made this argument without personal expertise or expert consultation. The Circuit Court dismissed this claim as well, stating that the statements were “legitimate attorney argument(s).” Id. at 1328.
The Court found that the prosecuting attorney’s statement were efforts to persuade, not to deceive. “While the law prohibits genuine misrepresentations of material fact, a prosecuting attorney is free to present argument in favor of patentability without fear of committing inequitable conduct.” Id. at 1328-1329.
Accordingly, while the Court upheld the finding of obviousness, it reversed on all inequitable conduct charges, leaving both sides to pay their own trial expenses.
Many practitioners have expressed confusion over the opinion, and in particular, disagreement with the Court’s reference to nursing garment design as “a very predictable field.” Such a sweeping statement insinuates that no nursing garment designed any time now or in the future could be patentable because of inevitable obviousness. The Court extends KSR Int’l Co. v. Teleflex to support this potentially dramatic broadening of obviousness in a dangerous way.
Conversely, the Court’s discussion and ultimate reversal of the inequitable conduct claims enables prosecuting attorneys to breathe a sigh of relief, as the jury’s findings on the issue, if upheld, would have placed inordinately high expectations on them. However, the Court admonished the parties for submitting what ought to be a judge-decided issue to the jury – an admonishment to be heeded by any patent litigator. The plaintiff may have been lucky that Judge Rader – well-known for his opinion that inequitable conduct is too liberally adjudged – served on the panel and authored the opinion, as another judge may well have upheld a jury’s factual findings on this issue.
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Image Credit: Rothman v. Target Corp./No. 2008-1375/U.S. Court of Appeals for the Federal Circuit