Obviousness Challenge Avoids Preliminary Injunction

In Erico International Corp. v. Vutec Corp. (February 19, 2008), the Federal Circuit vacated the grant of a preliminary injunction where an obviousness challenge cast enough doubt on the validity of Claim 17 of US5740994 to negate likelihood of success on the merits as to infringement of a valid patent:



According to the opinion by Circuit Judge Rader:

"Validity challenges during preliminary injunction proceedings can be successful, that is, they may raise substantial questions of invalidity, on evidence that would not suffice to support a judgment of invalidity at trial." Amazon.com, Inc., 239 F.3d at 1358. In other words, a defendant need not prove actual invalidity. On the contrary, a defendant must put forth a substantial question of invalidity to show that the claims at issue are vulnerable. Thus, a showing of a substantial question of invalidity requires less proof than the clear and convincing standard to show actual invalidity. Id.

This court concludes that the OBO Betterman reference coupled with the EIA standards and Mr. Laughlin's testimony mount a serious challenge to the validity of Claim 17 of the '994 patent. First, the OBO Betterman reference shows a hook fastener with downwardly flared flanges nearly identical to the Erico J-Hook. The downwardly flared flanges implicitly point to the reasonableness of sag in cables installed by using OBO Betterman fasteners. Second, the EIA standard states the appropriate spacing used between open-top cable supports. The OBO Betterman fasteners and the J-Hooks are similar to open-top cable supports in that cables are suspended between supporting members (i.e., J-Hooks, rungs of an open-top cable ladder). The applicable section of the EIA standard reads:

4.6.5 Cable Support
Where zone conduit or cable tray is not available in a suspended ceiling space and where telecommunications cables are allowed to be placed loosely in the ceiling, adequate open-top cable supports, located on 1222-1525-mm (48-60-in) centers, shall be provided.

It is reasonable to see that downwardly flared flanges coupled with the EIA spacing requirements could implicitly motivate a person of ordinary skill to use J-Hooks with the EIA spacing to achieve cable sag of no more than about 30 centimeters. See KSR Int’l Co., 127 S.Ct. at 1743; Dystar Textilfarben GmbH v. C.H. Patrick Co., 464 F.3d 1356, 1368 (Fed. Cir. 2006) ("[T]here exist[s] an implicit, indeed common-sensical, motivation to combine the two references."). To further show common cable installation practices prior to the filing of the '994 patent application, Mr. Laughlin's testimony shows an implicit motivation to combine the prior art. In part, Mr. Laughlin testified:

Q. I'm going to get to that in just a moment, okay. More than a year prior to the filing date of your patent, was it a common practice for installers of communication cables to pull the cable taut once they installed the cable between the supports if done in a workmanlike fashion?

A. Yes, if done in aworkmanlike fashion.

Q. Were communication cables installed more than a year prior to your patent filing date in a workmanlike fashion?

A. There certainly were people installing them in a workmanlike fashion, and there were many people that were not.

Q. But there were at least some people that were installing them in a workmanlike fashion?

A. Yes, some.

Q. More than a year before your filing date?

A. Yes.

Q. And you knew that when you filed your patent application?

A. Yes.

Q. When those installers who did install in a workmanlike fashion more than a year prior to your filing date in open top cable supports and pulled taut, the sag would be less than 30 centimeters, correct?

A. Yes, if they were pulled taut.

Transcript of Proceedings at 92-93, Erico Int'l Corp. v. Doc's Mktg. Corp., 1:05-cv-2924 (N.D. Ohio Mar. 9, 2006). Mr. Laughlin's testimony shows the reasonableness of installing cables using open-top cable supports with EIA spacing standards resulting in less than 30 centimeters of sag. As such, the OBO Betterman reference coupled with the EIA standards and Mr. Laughlin's testimony raise a substantial question of invalidity of Claim 17.

Even assuming the accuracy of the District Court's secondary consideration analysis, it is reasonable to infer that one of ordinary skill would have considered the OBO Betterman hook coupled with the EIA standards and common knowledge within the art as shown by Mr. Laughlin's testimony to explain that Claim 17 is vulnerable based on invalidity. See KSR Int'l Co., 127 S.Ct. at 1742; Amazon.com, Inc., 239 F.3d at 1358. Thus, Doc's invalidity challenge based on obviousness cast enough doubt on the validity of Claim 17 to negate likelihood of success on the merits as to infringement of a valid patent. At this point, of course, Doc's has only cast doubt on the validity of the '994 patent. The District Court will have the opportunity to reach a final validity determination at trial.

Accordingly, this court vacates the district court’s grant of a preliminary injunction.