IP Law Daily, PATENT—Fed. Cir.: Appeal Board’s rejection of bone screw patent application’s claims on new grounds warranted reversal, (Oct 18, 2013)

By Cheryl Beise, J.D.

A decision of the Board of Patent Appeals and Interferences (“Board”) affirming rejection of a bone screw patent application’s claims for obviousness was vacated by the U.S. Court of Appeals for the Federal Circuit because the Board relied on grounds for combining prior art references that were not cited by the examiner (In re Biedermann, October 18, 2013, Linn, R.).

Lutz Biedermann and Jurgen Harms (collectively “applicant”) appealed a decision of the Board affirming a patent examiner’s rejection of claims 32, 33, 35-37 37, 39, and 48 of U.S. Patent Application No. 10/306,057 (“the '057 Application”) for obviousness under 35 U.S.C.§ 103(a). The invention in the '057 Application is generally directed to a bone screw with a shank and a holding portion with a U- shaped cross-section for a rod that connects to other bone screws. The two legs of the holding portion have an inner thread that cooperates with the outer thread of a locking element or screw to hold the rod in place.

Background. The examiner rejected claims 32, 33, 35-37, 39, and 48 of the '057 Application as being unpatentable for obviousness over U.S. Patents No. 5,005,562 (“Cotrel”) and No. 4,846,614 (“Steinbock”) further in view of U.S. Patent No. 4,688,832 (“Ortloff”). Cotrel discloses a bone screw with a shank, a holding portion with internally threaded legs, and a locking element or screw to hold a rod. Steinbock discloses a machining arrangement for moving heavy loads using different thread configurations.

The examiner considered Cotrel to disclose all elements of the claimed invention except for the orientation of the two flanks of the inner thread enclosing an angle of 90° with respect to the central axis of the holding portion. As for the missing thread configuration, the examiner relied on Steinbock, concluding that “it would have been obvious to one of ordinary skill in the art at the time the invention was made to have provided threads with a square profile on the Cotrel legs, as taught by Steinbock, for efficient load transfer.” The examiner relied on the Ortloff reference for its disclosure of gaps or clearances between the crest of the outer thread and the root of the inner thread.

On appeal, the Board discussed the threads shown in Cotrel and Steinbock and also made reference, for the first time, to Erik Oberg et al., Machinery’s Handbook (Christopher J. McCauley et al. eds., 26th ed. 2000) (“Machinery’s Handbook”). The Board did not reach Ortloff and instead relied on the examiner’s alternative inherency rationale with respect to the gap.

The applicant requested rehearing, arguing that the Board issued a new ground of rejection by relying on “interchangeability” instead of “efficiency” and by referring to the Machinery’s Handbook, and additionally arguing that the Board failed to consider the negative teachings of Steinbock that relate to machinability. The Board denied the applicant’s request.

Notice of rejection. Because the Administrative Procedure Act (“APA”) requires the Patent and Trademark Office (“PTO”) to provide prior notice to an applicant of all “matters of fact and law asserted” prior to an appeal hearing before the Board, the PTO’s rules “provide that when the Board relies upon a new ground of rejection not relied upon by the examiner, the applicant is entitled to reopen prosecution or to request a rehearing,” the Federal Circuit explained. If the Board fails to follow these procedures, its decision must be vacated.

When considering whether the Board issued a new ground of rejection, the “ultimate criterion of whether a rejection is considered ‘new’ in a decision by the Board is whether applicants have had fair opportunity to react to the thrust of the rejection,” the court said. A new ground of rejection generally will not be found where the Board’s decision further explained an examiner’s rejection or responded to an applicant’s argument. However, the Board’s reliance on the same statutory basis and the same prior art references, alone, is insufficient to avoid finding a new ground of rejection where the Board relies on new facts and rationales not previously raised by the applicant or the examiner.

Combination of references. In this case, the court observed that the examiner’s reasoning in support of combining the square thread of Steinbock with the device of Cotrel was that there were a limited number of threads that could be used and that a square thread was the most efficient. The Board, on the other hand, found new facts as the basis for concluding that the combination of Cotrel and Steinbock would have been obvious: that Cotrel teaches avoiding splaying with saw-tooth threads; that saw-tooth threads are buttress threads; that Steinbock groups together the square threads and buttress threads; and that square threads avoid splaying.

The principal reason the examiner combined the references was the efficiency of a square thread, whereas the principal reason the Board affirmed the combination of the references was the avoidance of splaying by using square threads, the court explained. “These are different grounds and form the bases or underpinnings of different rejections. Even the Board itself recognized that efficiency and avoiding splaying were different,” the court said.

The government’s argument that the Board was providing additional details for the examiner’s reasoning, rather than changing the thrust of the rejection, was not persuasive, according to the court. The thrust of the rejection changed when the Board went beyond filling in gaps in the examiner’s reasoning and found a new factual basis for the reason to combine, the court said.

The government also asserted that the Board was merely responding to the applicant’s arguments rather than issuing a new ground of rejection. However, a new ground of rejection is not negated by the fact that the Board is responding to an appellant’s argument, according to the court.

Regarding the Board’s citation to the Machinery’s Handbook to associate buttress threads and saw-tooth threads, the court found that Board used the reference to support its new ground of rejection.

Lastly, the court determined that the Board also treated machinability as a new ground of rejection by citing it as another factor, in addition to efficiency, that one of ordinary skill would consider in selecting a threadform, thereby making it part of the reason to combine the references. “There was no apparent connection between machinability and the examiner’s reason to combine based on efficiency,” the court noted.

As the court recently explained in Rambus Inc. v. Rea, _F.3d_ (Fed. Cir. Sept. 24, 2013), “While the Board’s findings may ultimately be correct, we will not affirm a Board rejection, like this one, which essentially provides a new motivation to combine the references.” The Board’s decision was accordingly vacated and the case remanded for further proceedings.

The case is No. 2013-1080.

Attorneys: Luke Dauchot (Kirkland & Ellis, LLP) for Lutz Biedermann and Jurgen Harms. Monica B. Lateef, Associate Solicitor, United States Patent and Trademark Office.

Cases: Patent FedCir