Perfect Surgical Techniques, Inc. v. Olympus America, Inc.
841 F.3d 1004
Fed. Cir.2016Background
- PST appealed the PTAB’s IPR decision that JP ’551 anticipated or rendered obvious multiple claims of U.S. Patent No. 6,030,384; the Board treated JP ’551 as prior art under pre-AIA §102(a).
- Olympus submitted JP ’551 with a partial English translation missing the bibliographic page; Board accepted it and found publication date Feb. 10, 1998; PST argued the missing translation was fatal.
- PST sought to antedate JP ’551 under pre-AIA §102(g) by proving earlier conception and reasonable diligence in reduction to practice by inventor Dr. Camran Nezhat during the critical period (Feb. 9–May 1, 1998).
- Record: draft sent to Nezhat Jan 28, 1998; Nezhat returned comments Mar 2; Heslin (attorney) sent questions Mar 12 and met Mar 16; Heslin revised Apr 7, sent second draft Apr 13, and filed application May 1. PST introduced declarations, letters, and billing records to corroborate diligence.
- The Board found unexplained gaps (Feb 10–Mar 1; Mar 12–15; Apr 13–May 1), concluded PST failed to show continuous diligence, and held claims invalid over JP ’551. PST appealed claim construction and diligence findings.
Issues
| Issue | Plaintiff's Argument (PST) | Defendant's Argument (Olympus / Board) | Held |
|---|---|---|---|
| 1. Validity of relying on a partly untranslated JP ’551 | Olympus’s partial translation was defective because bibliographic page (publication date) wasn’t translated | Translator certification plus discernible date on untranslated page sufficed; date was not disputed | Court: Board’s acceptance was harmless error (translator certified pub. date; PST didn’t dispute date) — acceptance stands |
| 2. Whether PST antedated JP ’551 by proving reasonable diligence (critical period Feb 9–May 1, 1998) | Nezhat and Heslin provided testimony, letters, billing records showing ongoing work; diligence should be judged under a "rule of reason" requiring reasonably continuous (not literally continuous) diligence | Board identified specific unexplained gaps and found lack of "continuous exercise of reasonable diligence;" attorney activity insufficiently credited for some gaps | Court: Board applied an impermissibly exacting standard and failed to apply rule-of-reason / weigh attorney’s activities; vacated & remanded for reconsideration of diligence on whole record |
| 3. Whether the Board erred by disregarding attorney Heslin’s activities as imputable to inventor | Attorney’s work preparing and filing the application is imputable and should be considered as corroboration of inventor’s diligence | Board downplayed Heslin’s work and declined to rely on it to fill gaps | Court: Board erred by not properly crediting Heslin’s activity; on remand must consider attorney’s testimony and billing as part of diligence analysis |
| 4. Proper claim construction of term "perforated" in claims (affects anticipation by JP ’551) | "Perforated" should be limited as distinct from "passages" because specification uses "perforated or otherwise provided with passages" | Board construed "perforated" broadly to include "passages" and found JP ’551 discloses perforations | Court: Specification distinguishes perforations from passages; "perforated" does not encompass passages — vacated invalidity of claims 11, 38, 41–44, 46, 47, 49 and remanded for proceedings consistent with this construction |
Key Cases Cited
- Monsanto Co. v. Mycogen Plant Sci., Inc., 261 F.3d 1356 (Fed. Cir. 2001) (diligence must be shown throughout the critical period; rule-of-reason analysis)
- Brown v. Barbacid, 436 F.3d 1376 (Fed. Cir. 2006) (corroboration requirement; variety of activities may corroborate diligence)
- In re Steed, 802 F.3d 1311 (Fed. Cir. 2015) (antedating is legal question based on subsidiary facts; review standard)
- In re Cuozzo Speed Techs., LLC, 793 F.3d 1268 (Fed. Cir. 2015) (Board applies broadest reasonable interpretation in IPRs)
- Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831 (U.S. 2015) (factual subsidiary findings in claim construction reviewed for substantial evidence)
- Thorner v. Sony Comput. Entm’t Am. LLC, 669 F.3d 1362 (Fed. Cir. 2012) (patentee may act as lexicographer; specification can limit claim terms)
- In re Mulder, 716 F.2d 1542 (Fed. Cir. 1983) (short unexplained inactivity can defeat diligence when critical period is very short)
- In re Jolley, 308 F.3d 1317 (Fed. Cir. 2002) (corroboration may be circumstantial; not every factual issue requires direct corroboration)
- Creative Compounds, LLC v. Starmark Labs., 651 F.3d 1303 (Fed. Cir. 2011) (applicant must account for the entire period during which diligence is required)
- Mahurkar v. C.R. Bard, Inc., 79 F.3d 1572 (Fed. Cir. 1996) (conception plus diligent reduction to practice required to antedate)
- Gould v. Schawlow, 363 F.2d 908 (C.C.P.A. 1966) (inventor must provide specific dates and facts to account for entire period)
- In re McIntosh, 230 F.2d 615 (C.C.P.A. 1956) (formulation of diligence as "continuous exercise of reasonable diligence")