ABT Systems, LLC v. Emerson Electric Co.

Addressing the issue of obviousness, the U.S. Court of Appeals for the Federal Circuit overturned the jury verdict of non-obviousness and focusing on the nature of the problem to be solved, concluded that the asserted claims were invalid as obvious. ABT Systems, LLC v. Emerson Electric Co., Case Nos. 14-1618; -1700 (Fed. Cir., Aug. 19, 2015) (Schall, J.).

The University of Central Florida owned a patent directed to an air conditioning system with a recycle control function where the fan is periodically operated a certain time after the system is deactivated. The inventor’s company, ABT Systems, was a licensee. Together they sued Emerson Electric for infringement based on the “Comfort Circulating Fan Feature” of Emerson’s Big Blue thermostat product.

Emerson argued that the asserted claims were obvious in light of four prior art references dating from as far back as 1931. Some of the references disclosed a single fan operation a certain time after deactivation, while other references disclosed periodic fan operation unrelated to the deactivation time. The case went to trial, and the jury found the claims valid and infringed, but awarded minimal damages. Emerson unsuccessfully moved for judgment as a matter of law (JMOL) that the claims were obvious. The court held that a reasonable jury could have concluded that the prior art did not disclose periodic fan operation dependent on the deactivation time, as recited in the claims. The district court also concluded that the jury could have credited ABT’s long-felt need evidence.

ABT appealed certain damages rulings and Emerson cross-appealed on obviousness.

On appeal, the Federal Circuit found all claims to be obvious and dismissed the damages questions as moot. The Court agreed that it should resolve all factual disputes in favor of the jury verdict, but concluded that there were few, if any, factual disputes other than with respect to secondary considerations. The parties had apparently agreed that the prior art included all claim elements other than the single element calling for periodic fan operation a certain time after deactivation, agreed that certain prior art references disclosed periodic fan operation for the same air stagnation problem addressed in the asserted patent, and agreed that other references disclosed a “single-shot” fan cycle after a predetermined delay following deactivation of the central air system. On that record, the Federal Circuit held that the motivation to combine the prior art arose from the nature of the problem to be solved and the combination would have been naturally implemented to yield predictable results. The Court dismissed ABT’s reliance on secondary considerations, such as commercial success and long-felt need because ABT failed to show the required nexus with the invention.