In an August 11, 2023 precedential opinion in Rembrandt Diagnostics, LP v. Alere, Inc. (available here), the Federal Circuit affirmed a final written decision finding claims of a patent directed to testing biological fluids unpatentable for obviousness.  In so doing, the Federal Circuit found that Alere, Inc. (“Alere”) did not offer new theories in its reply brief and that substantial evidence supports the Board’s determinations.

 

The dispute began in 2016 in district court when Rembrandt Diagnostics, LP (“Rembrandt”) sued Alere for patent infringement.  Thereafter, Alere filed a petition for inter partes review challenging certain claims of U.S. Patent No. 6,548,019 (the “’019 Patent”).  The Board instituted on certain grounds and certain claims after which Rembrandt disclaimed certain challenged claims.  In a final written decision, the Board found that claim 2 was anticipated, but that Alere had failed to prove claims 3-5 were unpatentable.

 

Thereafter, in an earlier appeal, Alere, inter alia, successfully asked the Federal Circuit to remand for the Board to consider all non-instituted claims and grounds under SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018).

 

On remand, Rembrandt filed a patent owner response (without an expert declaration) addressing the non-instituted grounds, and Alere filed a reply (with an expert declaration) responding to Rembrandt’s arguments and to the observations the Board raised in its original institution decision.  Rembrandt filed a sur-reply in which it argued that Alere resorted to new theories in reply.  Specifically, it discussed one prior art combination but did not contest that Alere had raised new theories in reply for two other combinations at issue here.

 

Thereafter, the Board issued a final written decision finding claims 2-6 and 10 unpatentable.  In making certain findings, the Board credited Alere’s expert’s unrebutted testimony regarding benefits of the prior art combination and regarding a motivation to combine and reasons for modification.

 

On appeal, Rembrandt argued that the Board abused its discretion when it relied on Alere’s new theories and evidence, and, alternatively, that substantial evidence fails to support the Board’s unpatentability determinations.  Alere argued that Rembrandt forfeited the new theories and evidence argument but, even if it did not, the position lacks merit because the positions were responsive to Rembrandt’s arguments and the Board’s observations.  Further, Alere argued that substantial evidence supported the Board’s factual findings.

 

First, the Federal Circuit found that Rembrandt forfeited its argument that petitioner offered new theories.  “⁠Alere contends that Rembrandt forfeited its new-theories argument by expressly objecting to one obviousness ground . . . for allegedly raising new theories without also making the same objection to the grounds at issue here . . ..  We hold that Rembrandt’s generic objection is insufficient to constitute a proper objection – especially because Rembrandt expressly objected to other allegedly new theories without doing so here.  Indeed, it would be unfair to both the parties and the Board to read so broadly such a generic objection: Neither would have adequate notice of which theories are allegedly new.”

 

Second, the Federal Circuit addressed Rembrandt’s new-theories argument and found that Alere did not improperly make them in reply.  “Alere’s reply argument discussing cost and time savings has a nexus to Rembrandt’s prior argument and is responsive.  It refutes Rembrandt’s assertions that there is no motivation to add multiple test strips or an expectation of success.  And by discussing time and cost savings as a form of efficiency, it also properly expands on and is a fair extension of its previously raised efficiency argument.”  Similarly, the Federal Circuit found that Alere disputed Rembrandt’s contention that wicking material is fundamental to a prior art reference and explains that removing wicking material would further achieve that reference’s goals of inexpensive and easy manufacturing.  “And Alere’s reply argument elaborates on the motivation-to-combine argument that Alere made in its petition – that there were benefits known in the art of removing the wicking material – by relying on MacKay and Lee-Own.”  Finally, Rembrandt argued that Alere’s use of previously unidentified disclosures of the prior art references is impermissible.  The Federal Circuit disagreed, as Alere did “not point to any new embodiments not previously identified to advance a meaningfully distinct contention from what it first asserted in its petition.”  It pointed to additional portions as “a legitimate reply” to Rembrandt’s arguments and the Board’s observations.  “Alere’s reply argument involves the same ‘legal ground’ based on ‘the same prior art reference[s]’ and the ‘same legal argument’ – the motivation to remove the prior art’s wicking material and reverse its orientation.

 

Finally, the Federal Circuit found that the Board did not err in its obviousness determinations. “Based on our 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 Board was presented with ‘two alternative theories’ about what the prior art discloses, and it is not this court’s task ‘to determine which theory we find more compelling.’”

 

In conclusion, the Federal Circuit found that the Board did not abuse its discretion in relying on Alere’s responsive theories, and substantial evidence supported the Board’s underlying factual findings.  Thus, the Federal Circuit affirmed the Board’s determinations that claims 3-6 and 10 of the ’019 Patent would have been unpatentable due to obviousness.