The Federal Circuit and Patentability: An Empirical Assessment of the Law of Obviousness

Article excerpt

It is by now a cliché to suggest that the United States Court of Appeals for the Federal Circuit has weakened the standards for obtaining patents. In this Article, we empirically assess that court's performance on the ultimate question of patentability-the requirement that a patentable invention must be "nonobvious." Our findings suggest that the conventional wisdom may not be well grounded, at least on this measure.

Nowhere is the Federal Circuit's controversial role as the locus of judicial power in the U.S. patent system more evident than in the context of the doctrine of obviousness under 35 U.S.C. § 103. The determination of whether an invention was "obvious" to "a person having ordinary skill in the art" at the time the invention was made is the foundation of patentability-and thus at the very core of the patent bargain. And the issue's status as a question of law, as well as the spare statutory language, means that the law of obviousness is entirely a creation of the courts.

In the study reported here, we systematically examined the Federal Circuit's doctrine of obviousness. Using empirical data collected from a novel data set spanning more than fifteen years of jurisprudential pronouncements, we suggest that the Federal Circuit has developed a doctrine in this area that is relatively stable and appears reasonably predictable. Indeed, contrary to much recent commentary, these results suggest that the Federal Circuit's doctrinal tool kit-especially the much-discussed (and oft-maligned) "teaching, suggestion, or motivation" test for combinations of references-has not had a significant observable effect on the results of obviousness cases at that court.

Although this study falls short of painting a complete picture of the Federal Circuit's performance with respect to patentability, the view that emerges is of a modern jurisprudence of obviousness that is more stable, more consistent, and more flexible than has been heretofore understood. These results, then, should give pause to those who argue for a radical reshaping of the Federal Circuit's doctrine under 35 U.S.C. § 103.

I. Introduction

Nearly twenty-five years into the intentional experiment in institutional design that created it, the United States Court of Appeals for the Federal Circuit is unquestionably the most influential player in the U.S. patent system.1 And as the economic significance of patents to the national economy continues to increase,2 the central role played by the Federal Circuit has become increasingly visible,3 pronounced,4 and controversial.5

Nowhere is the importance of the Federal Circuit more apparent-and more discussed-than with respect to the standards for patentability, the fundamental requirements for obtaining a patent grant. In this context, the court is cast in two critical roles: as the oversight authority for the administrative body that grants patents (the U.S. Patent and Trademark Office (PTO)) and as the sole appellate authority for litigated disputes involving already-issued patents. In determining patentability, perhaps more than in any other aspect of the patent system, the centralization of legal power that is the core justification for the Federal Circuit6 is brought into sharp relief.

In this study, we use a novel data set and well-tested techniques to empirically assess the Federal Circuit's performance7 in the realm of patentability-specifically with respect to the court's doctrine of obviousness under 35 U.S.C. § 103. That section's requirement-that a patentable invention be nonobvious to a person having ordinary skill in the art at the time the invention was made8-is plainly the "ultimate condition of patentability,"9 and thus lies at the core of the basic quid pro quo that is the foundation of patent theory.

Assessing the law of obviousness is not only important to understanding the institutional role of the Federal Circuit; it is also of critical (and timely) importance in its own right. …