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Federal Circuit Vacates SJ of Nonobviousness Based on Erroneous Findings as to the Analogousness of the Prior Art and the Level of Skill in the Art

10-1290
March 21, 2011
Jiménez, Clara N.

Decision icon Decision

Last Month at the Federal Circuit - April 2011

Judges: Rader, Lourie (author), Whyte (sitting by designation)

[Appealed from: E.D. La., Judge Feldman]

In Innovention Toys, LLC v. MGA Entertainment, Inc., No. 10-1290 (Fed. Cir. Mar. 21, 2011), the Federal Circuit affirmed the district court’s grant of SJ of literal infringement and vacated the grant of SJ of nonobviousness.  The Court remanded on the issue of obviousness.

Innovention Toys, LLC (“Innovention”) sued MGA Entertainment, Inc., Wal-Mart Stores, Inc., and Toys “R” Us, Inc. (collectively “MGA”) for infringement of U.S. Patent No. 7,264,242 (“the ’242 patent”), based on MGA’s Laser Battle game.  The ’242 patent is directed to a chess-like, light-reflecting board game and methods of playing the game.  All of the asserted claims include a “key playing pieces” limitation in which the key pieces are “movable.”  MGA’s Laser Battle game is a board game for playing a chess-like strategy game.  The game’s Tower pieces, which are placed on the board at the beginning of the game, can be placed at different locations, and do not need to remain in their standard positions during “Advanced Game Play.”

MGA denied infringement and alleged that the ’242 patent was invalid for obviousness under 35 U.S.C. § 103.  In alleging obviousness, MGA relied on the combination of two articles describing electronic, computer-based, chess-like strategy games (collectively “the Laser Chess references”) and a U.S. patent describing a chess-like strategy board game.  The parties moved for SJ on the issues of infringement and invalidity.  The district court granted Innovention’s motions for SJ of literal infringement and nonobviousness, and its motion for a permanent injunction.  MGA appealed.

On appeal, the Federal Circuit affirmed the grant of SJ of literal infringement.  The Court based its decision on the district court’s construction of “movable” as “capable of movement,” because MGA did not directly challenge the construction.  The Court held that the district court’s construction encompassed movement during game setup, and, therefore, MGA’s Laser Battle game infringed.

The Federal Circuit vacated the grant of SJ of nonobviousness, concluding that the district court clearly erred in finding that the Laser Chess references were not analogous art, and that a person of ordinary skill in the art was a layperson.

First, the Federal Circuit found that the Laser Chess references were analogous art, even though they describe electronic games and the ’242 patent is directed to a physical board game.  The Court found that the ’242 patent and the references were directed to the same purpose of detailing specific game elements comprising a chess-like, laser-based strategy game.  The Court stated that “[i]f a reference disclosure has the same purpose as the claimed invention, the reference relates to the same problem, and that fact supports the use of that reference in an obviousness rejection.”  Slip op. at 13 (quoting In re Clay, 966 F.2d 656, 659 (Fed. Cir. 1992)).  The Court concluded that no reasonable jury could find that the Laser Chess references did not qualify as analogous prior art, and that the district court erred in concluding otherwise.  The Federal Circuit found that because of this error, the district court did not properly consider the scope and content of the prior art, or the differences between the art and the claimed invention.  The Court thus remanded these factual determinations to the district court to consider in the first instance.

The Federal Circuit also found that the district court erred in basing its obviousness analysis on the level of skill of a layperson.  The Federal Circuit reasoned that Innovention conceded that the level of ordinary skill in the art was greater than that of a layperson, and that the district court appeared to agree, stating that “it seems some knowledge of mechanical engineering or optics is required.”  The Court concluded that the district court found nonobviousness based on an inappropriately low level of skill in the art, and that the error was not harmless.  The Federal Circuit remanded with instruction for the district court to make a finding on the level of skill in the art and to base its obviousness analysis on that level of skill.

Because the Federal Circuit vacated the district court’s grant of SJ of nonobviousness, the Federal Circuit also vacated the permanent injunction.

 

Summary authored by Clara N. Jimenez, Esq.