Supreme Court Takes on the Federal Circuit's "Extravagant" Indefiniteness Standard

29 April 2014 IP Litigation Current Blog

Yesterday, the Supreme Court heard oral argument in Nautilus, Inc. v. Biosig Instruments, Inc., No. 13-369. Biosig sued Nautilus in 2004 over a patent covering heart rate monitor technology associated with exercise equipment. The district court invalidated the claims for being indefinite, however the Federal Circuit reversed concluding that the claims would have been understood by one of ordinary skill in the art, even if that person required a small amount of experimentation using standard equipment and methods. The claims at issue require that two electrodes be in a “spaced relationship” from each other “whereby” the system would function. The principal issue presented is whether the claims are invalid as indefinite under 35 U.S.C. § 112 2 since the term “spaced relationship” is amenable to different reasonable constructions. During yesterday’s argument, however, the Justices indicated that this case may signal the end to the Federal Circuit’s “insolubly ambiguous” standard for indefiniteness. Unfortunately, the Justices did not express any enthusiasm for the alternative standards proposed by Nautilus, Biosig, or the U.S. Government, leaving it to the Court to fashion a better–currently unknown–standard.

The principal question presented by Nautilus to the Supreme Court, and addressed by yesterday’s oral argument was: “Does the Federal Circuit’s acceptance of ambiguous patent claims with multiple reasonable interpretations—so long as the ambiguity is not ‘insoluble’ by a court—defeat the statutory requirement of particular and distinct patent claiming?”

In its briefing and argument Nautilus stressed that the term “spaced relationship” is amenable to more than one reasonable construction, and that therefore the claims are indefinite since they do not apprise one of ordinary skill as to the proper scope of the claims. Biosig, relying largely on the Federal Circuit’s analysis below, stressed that while multiple reasonable constructions were plausible, one of ordinary skill in the art would have understood the scope of the claims.

Through yesterday’s argument, the Supreme Court indicated a desire to replace, or at least clarify, the “insolubly ambiguous” standard currently applied by the Federal Circuit, which can be prone to misinterpretation by the District Courts. However, the Supreme Court was also clearly frustrated with the lack of any clear alternative standard that could be applied reliably in the future.

A number of Justices, including Justice Ginsburg, Justice Sotomayor, Justice Scalia and Chief Justice Roberts, expressed skepticism towards Nautilus’s suggestion that any claim susceptible to more than one reasonable interpretation be invalidated–citing, for example, the fact that judges themselves may often reasonably disagree as to the proper construction of a claim. Justice Scalia described how Nautilus’s argument boiled down to requiring that there be only one “right result and everything else is unreasonable.”

However, the Justices also expressed dislike for the Federal Circuit’s “insolubly ambiguous” standard. Indeed, Justice Scalia referred to the Federal Circuit’s use of “extravagant language” (understood by Biosig as a reference to the “insolubly ambiguous” standard) as a reason for the Supreme Court having granted certiorari. Biosig, which relied largely on the Federal Circuit’s reasoning below, also refused to embrace the Federal Circuit’s “insolubly ambiguous” standard outright. Rather, during the argument Biosig suggested that if the standard was solely whether terms were “insolubly ambiguous,” without regard to other tenets of claim construction, “some district courts might misinterpret those words.”

The U.S. Government was also asked to provide briefing and argument on the issue. The Solicitor General’s office advanced a standard for indefiniteness premised on whether a person of ordinary skill in the art would reasonably understand the scope of the claim, and also rejected the Federal Circuit’s “insolubly ambiguous” standard–describing how the standard “could cause mischief if applied in isolation.” The Government suggested that, in situations where multiple reasonable claim constructions are available, the Court adopt the one that is “appreciably better,” thereby avoiding the need to find the other construction(s) “unreasonable.” The Justices expressed concern over when, under the Government’s standard, a patent would actually be invalid. Justice Breyer in particular stressed concern that claim construction would be relegated to a battle between experts, with each side proffering a witness describing how one of ordinary skill would reasonably understand the scope of the claims. Meanwhile, Justices Scalia and Alito expressed concern over what “appreciably better” actually means.

An interesting aside to the main issues raised during yesterday’s argument was Justice Sotomayor’s interest in whether the prosecution history from post-issuance proceedings (such as a reexamination) should be considered when considering indefiniteness. Nautilus suggested that it should not be. Justice Sotomayor asked counsel for Biosig “Do you agree with your adversary that the prosecution history is that at the time the patent was issued and not on reexamination or anything else subsequent?” Justice Sotomayor then described how “it seems logical, that you’re going to stifle inventiveness if people can’t, once the patent is issued, know how to get around it.” A Supreme Court decision that adopted Nautilus’s suggestion to ignore the prosecution history of later proceedings, including reexamination proceedings, could have a significant impact on future indefiniteness inquiries and Markman proceedings. For example, the treatment of similar claim terms during the prosecution of a continuation patent application, or in a reexamination proceeding, will often be relied upon by the parties when arguing claim construction or indefiniteness. A decision barring the use of post-issuance prosecution history information could require a significant change in practice, and could affect prior Federal Circuit precedent. (See e.g.,  Microsoft Corp. v. Multi-Tech Sys., Inc., 357 F.3d 1340, 1350 (Fed. Cir. 2004).)

Yesterday’s argument reflected a perceived lack of guidance from the Federal Circuit on the issue of indefiniteness–and a desire by the Court for a better standard than “insolubly ambiguous.” As with some other recent patent-related decisions by the Supreme Court, we may eventually see an opinion that provides some much desired clarification and guidance to the law of indefiniteness. However, given the lack of a clear consensus over any of the standards discussed during the argument, it is unclear what a new standard might look like. Nautilus’s approach seemed rather unworkable to the Court; Biosig’s approach was viewed by some, including Justice Alito, as similar to ”insolubly ambiguous”; and the Justices also had criticisms over the effectiveness of the Government’s approach. That said, some view the Government’s approach as a reasonable starting point for any new standard.

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