Icon Health v. Strava, (2016-1475) February 27, 2017.  Before Judges O’Malley (concurring-in part and dissenting-in-part), Reyna, and Wallach.

Takeaway:

• In order to withstand a challenge on appeal, a determination by the PTAB that the claims of a patent would have been obvious must be supported by substantial evidence, and be adequately explained. In an inter partes reexamination, attorney argument alone cannot provide an appropriate evidentiary basis for rejecting claims as being obvious over the prior art.

Procedural Posture:

Icon appealed from a decision of the PTAB, which affirmed the Examiner who, during an inter partes reexamination, rejected all pending claims as being obvious over the prior art.  The CAFC affirmed-in-part, vacated-in-part, and remanded for additional proceedings.

Synopsis:

• Obviousness – Expert Declarations: The CAFC rejected Icon’s arguments that the PTAB erred in affirming the Examiner’s decision when the examiner cited extensively to Strava’s expert declarations. The CAFC found that the PTAB is permitted to weigh expert testimony and other record evidence, and rely on certain portions of a declaration while disregarding others.

• Obviousness – Substantial Evidence: PTAB decisions must be supported by substantial evidence and adequately explained. The CAFC vacated portions of the PTAB’s decision, which rejected the claims as being obvious over the prior art, finding that the PTAB failed to show substantial evidence to support portions of its decision.  For the portions of the PTAB’s decision vacated by the CAFC, the PTAB supported its decision for rejecting the claims by incorporating the factual findings of the Examiner contained in specific portions of the Examiner’s Right of Appeal Notice.  “In the Right of Appeal Notice, however, the Examiner only stated that it ‘agree[d] with’ and ‘incorporated by reference’” arguments made by the Strava’s attorneys.  Icon Health & Fitness, Inc. v. Strava, Inc., No. 2016-1475, 2017 WL 744548, at *5 (Fed. Cir. Feb. 27, 2017).  As attorney argument is not evidence, neither the Examiner, nor the PTAB, made any factual findings on which to base their decisions.  Accordingly, the CAFC vacated the decision of the PTAB.  The portions of the PTAB’s decision that were affirmed by the CAFC contained genuine factual findings based on evidence; not merely attorney argument.  Additionally, the decision by the PTAB to reject these claims as obvious was adequately explained in the PTAB’s decision.

• Other Opinion – Remedy: Judge O’Malley concurred-in-part with the majority’s opinion, but dissented with respect to the appropriate remedy. Judge O’Malley stated that “remand is not the appropriate remedy in examination appeals in which the PTO has not carried its burden of establishing unpatentability. … The appropriate remedy in this situation is to allow any claims for which the PTAB has not carried its burden of proof.”  Icon Health at *10 (O’Malley, J., dissenting-in-part).