By: Thomas Lingard
In the recently announced precedential decision from the PTAB, Lextrosonics, Inc. v. Zaxcom, Inc., Zaxcom, the owner of U.S. Patent No. 7,929,902 (“the ‘902 patent”), showed that secondary considerations of nonobviousness, including long-felt need and, especially, industry praise, was sufficient to overcome obviousness in an IPR. Not every invention will win an Emmy, however, three takeaways from this case show why patent practitioners should not ignore secondary considerations of nonobviousness: (1) effusive praise from industry professionals strongly supports nonobviousness; (2) the evidence of nonobviousness can speak for itself; and (3) practitioners can amend claims to read on the praised feature of the invention.
The ‘902 Patent
The ‘902 patent relates to systems and methods for recording and processing audio recordings on a movie or television set. Actors wear or act next to audio collecting devices, which locally records the audio along with a timestamp. The audio devices wirelessly transmit live and recorded audio, along with meta-data such as timestamp, to a receiver. The receiver then collates the audio and replaces any audio missing from the live transmission with audio from the transmitted recording. IPR2018-01129 p. 3–4. This helps to prevent dropouts, which are sections of “segments of the local audio that were previously transmitted by a local audio device to a remote receiver/recorder but not properly received.” Id. at p. 49.
This invention was very successful. Zaxcom provided declarations from two industry professionals, Mr. Sarokin and Mr. Wexler. These individuals sing the praises of the invention. Zaxcom further provided evidence that the invention received industry praise and recognition, including an Emmy award and a Technical Achievement Award from the Academy of Motion Picture Arts and Sciences. Id. at p. 34. Importantly, the declarations and the awards focus on the feature of preventing dropouts, which enabled the recording of all sounds on a set.
The Requirement of a Nexus
Lextrosonics challenged the ‘902 patent in an IPR, seeking to invalidate claims of the ‘902 patent based on several references, and the PTAB essentially agreed that the claims were obvious in view of the prior art. The PTAB also responded to arguments about objective indicia of nonobviousness, emphasizing that “[f]or objective indicia of nonobviousness to be accorded substantial weight, its proponent must establish a nexus between the evidence and the merits of the claimed invention.” Id. at p. 32.
If the patent owner fails to positively establish a nexus, he “is still afforded an opportunity to prove nexus by showing that the evidence of secondary considerations is the direct result of the unique characteristics of the claimed invention.” Id. at p. 34 (quoting Fox Factory, Inc. v. SRAM, LLC, 994 F.3d 1366, 1375 (Fed. Cir. 2019)). In Zaxcom’s case, the PTAB found that Zaxcom’s evidence related to fixing dropouts. The PTAB held that the challenged claims do not include a limitation related to fixing dropouts, and therefore, there is no nexus between the evidence and the challenged claims.
Perhaps knowing about this flaw, Zaxcom moved to replace the challenged claims with substitute new claims that read on the praised product, which the PTAB entered and examined on the merits. The PTAB still found the substitute claims obvious based on the prior art, but found a nexus between the substitute claims and the industry praise. This nexus resulted from a “replacing” limitation in the substitute claims, directed to fixing the dropouts.
Objective Indicia of Nonobviousness
Having established a nexus, the PTAB then analyzed the objective indicia of non-obviousness, most importantly long-felt need and industry praise. First, Zaxcom established that there was a long-felt need for a “wireless, wearable, transmitting and recording device that could reliably capture sound data from actors recording a movie or television show.” Id. at p. 66. The PTAB “credited” the testimony provided by Mr. Sarokin and Mr. Wexler, who spoke about how badly they wanted a fully synchronous digital recorder.
Second, Zaxcom used the testimony of Mr. Sarokin and Mr. Wexler to show industry praise of the product. Indeed, Mr. Sarokin said that he “can’t emphasize enough the revolution these recording radios brought on,” and that “[n]o other company has anything remotely close” and “[t]here is nothing even remotely comparable.” Id. at p. 68. Mr. Wexler said that “[w]ith Zaxcom’s brilliant invention . . . I could always deliver a track to post production even . . . where there were failures of the RF transmission” and “nothing else even came close.” Id. The PTAB further pointed to Zaxcom’s awards for the invention. The Emmy award “specifically praises features of the proposed substitute claims.” Id.
On balance, the PTAB held that the “factors of long-felt need and especially industry praise weight heavily in favor of nonobviousness” and that “the objective indicia of nonobviousness strongly support a conclusion of nonobviousness.” Id. at p. 72.
Added Strength to Secondary Considerations Arguments
Patent practitioners often decline to argue secondary considerations of nonobviousness. They often pursue other avenues of prosecution, including narrowing amendments to overcome an obviousness rejection. Three takeaways from this case show why patent practitioners should rethink arguing secondary considerations of nonobviousness.
First, effusive praise from industry professionals strongly supports a finding of nonobviousness. When backed up by recognition from professional associations, the PTAB recognized that Zaxcom’s invention was not only useful, but an important technical advancement. Hopefully patent Examiners, appeal boards, future PTAB boards, and other decision makers do not interpret this case such that an invention requires an Emmy to succeed show industry praise. Rather, practitioners should find the most loyal customers, and ask them to provide a heartfelt testimony on how the invention impacted their business. Encourage the professionals to emphasize why the claimed invention provided such a significant impact.
Second, the evidence of nonobviousness can speak for itself. Perhaps to save space in briefs, Zaxcom did not analyze the nexus in either the initially challenged claims or the substitute claims. Nevertheless, the PTAB read and interpreted the evidence and established a nexus themselves. While it is risky not to make an argument, in this case, the evidence was strong enough to speak for itself, leaving room in briefs for Zaxcom to bolster its other arguments. To allow the evidence to speak for itself, practitioners should try to find and present evidence of nonobviousness that strongly supports and is strongly correlated with the claimed invention.
Third, it’s not over until it’s over. Zaxcom successfully applied for new, substitute claims. The new claims allowed Zaxcom, without broadening the scope of the originally challenged claims, to write claims that directly read on the praised features of their invention. This allowed the PTAB to establish a nexus between the secondary considerations and the substitute claims, when it would not establish one with the originally challenged claims. Therefore, at any stage of prosecution, including responses to final and non-final Office Actions, appeals, and IPRs, patent practitioners can ensure that the claims read directly on the praised product. However, don’t get greedy and remove limitations that are critical to the functionality of the product.
While secondary considerations of nonobviousness are not often the go-to arguments by patent practitioners, this decision shows that these arguments can be successful. Hopefully the case does not require an Emmy to win, though.
Thomas Lingard is a registered patent attorney. His practice focuses on preparing and prosecuting domestic and foreign patent applications in a variety of technological areas. Mr. Lingard has experience in identifying products that potentially infringe his client’s patents, as well as preparing patentability and patent infringement opinions.