The Federal Circuit affirmed a decision by the U.S. Patent and Trademark Office (USPTO) Patent Trial and Appeal Board (PTAB) in an inter partes review prompted by an infringement allegation in DexCom, Inc. v. Stewart (nonprecedential). The dispute created an opportunity for the Court to acknowledge the importance of the "expanded and flexible" approach to obviousness determinations occasioned by the Supreme Court's decision in KSR Int'l. Co. v. Teleflex. Inc., 550 U.S. 398 (2007), and also the question of the extent to which prior art containing alternative embodiments, only one of which is relevant to obviousness requires evidence that the skilled artisan would have (not only could have) chosen the embodiment that supported an obviousness determination.
The case arose in an inter partes review proceeding against DexCom's U.S. Patent No. 10,702,193* brought by Abbott Diabetes Care, Inc.** and asserting invalidity for obviousness against Claims 1–3 and 11–13. The '193 patent was directed towards glucose monitoring in patients using an implantable "transcutaneous continuous glucose sensor system." The opinion explains that the invention sought to overcome a local inflammatory response, termed a "foreign body response" that caused implanted devices to lose their function over time, by using a "barrier cell disruptive layer" configured with a number of electrode layers separated by layers of non-conductive material. Claim 1 was set forth in the opinion as being representative:
1. A transcutaneous continuous glucose sensor system comprising:
a substantially planar sensor, the sensor comprising:
a first conductive layer associated with a first electrode;
a first non-conductive layer located at least in part over the first conductive layer;
a second conductive layer associated with a second electrode, wherein the second conductive layer is located at least in part over the first non-conductive layer;
a second non-conductive layer located at least in part over the second conductive layer;
a third conductive layer associated with a third electrode, wherein the third conductive layer is located at least in part over the second non-conductive layer; and
a membrane located over at least a portion of a working electrode;
wherein at least one of the first electrode, the second electrode, or the third electrode is the working electrode, and wherein the working electrode is configured to measure a signal indicative of a glucose concentration.
The specification of the '193 contains inter alia this drawing of the claimed device:
which is described thusly in the '193 patent:
The sensor typically comprises a working electrode 21, a reference electrode 20, and an optional counter electrode 22. These electrodes may be insulated from each other by insulative layers 28 and further be housed in housing 10. The reference electrode 20 provides a stable - voltage electrode relative to which the voltage of the working electrode 21 can be controlled or detected. The optional counter electrode 22 draws the current flowing through the working electrode 20 so that the current through the reference electrode 20 is kept at a minimum, thus maintaining its voltage stability. The end surfaces of all three electrodes are advantageously coated with membrane system 32, which may comprise a layer of glucose oxidase enzyme. The membrane may then be coated with the barrier cell disruptive biointerface 33.
DexCom brought suit against Abbott for infringement and Abbott petitioned for inter partes review. Abbott's obviousness challenge relied as the primary reference on U.S. Patent Application No. 2005/0215871, arguing that Figures 4A, 4B, and 2A were sufficient to establish obviousness:
Figure 4A illustrates a three-electrode sensor, and Figure 2A shows a two-electrode sensor with the electrodes separated by a plastic (non-conductive) layer in a "stacked fashion." Abbott argued that this disclosure would have been understood by the skilled worker to show that "the three conductive layers associated with the electrodes are located overtop each other in a stacked fashion," relying on expert testimony that "Figure 4A confirms the stacked arrangement because one of the electrode 'trace' lines connecting an exterior electrode to the insertion tip covers the other two trace lines." Abbott also argued that inserting non-conductive layers between the electrodes would have been obvious in order to avoid short circuits between the electrodes.
In its Final Written Decision, the PTAB held that all challenged claims were obvious. The Board was convinced that Figure 4A disclosed three electrode layers "located overtop each other in a stacked fashion," reinforced by the disclosure in Figure 2A. This appeal followed.
The Federal Circuit affirmed, in an opinion by the Honorable Nina Y. Wang, District Judge, U.S. District Court for the District of Colorado, sitting by designation, joined by Chief Judge Moore and Judge Stoll. The panel rejected DeCom's argument that the Board misread Figure 4A in the Feldman reference to infer that the electrode layers were stacked, and that other configurations could be inferred with equal likelihood. This this failure, according to DexCom should have precluded the Board's decision from being supported by substantial evidence. The panel contended that, on the contrary this is a misreading of the Board's decision. The opinion states that the standard is that the Board's interpretation was one interpretation relevant to the issue of obviousness of the challenged '193 patent claims, and that what was claimed in those claims was encompassed by the Feldman disclosure, crediting Abbott's expert's testimony. The Court relied on Bradium Techs. LLC v. Iancu, 923 F.3d 1032, 1049 (Fed. Cir. 2019), for the principle that a reference should be interpreted "not only for what it expressly teaches, but also for what it fairly suggests" to a skilled artisan. The Board properly considered, according to the panel, that "a skilled artisan would have interpreted Feldman as encompassing the stacked electrode arrangement" and that this was substantial evidence supporting the decision. While consistent with the case law relied upon by the Court, this interpretation seems to risk hindsight reasoning without some indication that the Board's interpretation was how the skilled worker would have, not just could have, interpreted the reference this way. It appears from the opinion that the panel believed Abbott's expert's testimony was sufficiently convincing to find substantial evidence support for the Board's decision.
The Court also considered DexCom's arguments to be a further misreading of the Board's decision with regard to whether the Board held that Feldman disclosed the five-layer electrode configuration or just rendered it obvious (the panel also interpreting these arguments as being inconsistently argued by DexCom) (emphasis added). The panel considered DexCom's argument to be that "an obvious but undisclosed arrangement necessarily requires modification" but because Abbott never argued a need for modifying Feldman DexCom lacked the opportunity to respond to this argument during the IPR. In addition, DexCom complained that the "Board failed to make the requisite fact-findings regarding a skilled artisan's modification of Feldman," and thus applied an incorrect obviousness standard. The Court agreed that "there is no such 'dichotomy' between disclosure and obviousness, and that the Board's decision d[id] not rely on modifying Feldman to achieve the claimed arrangement" to which the panel also agreed.
The panel further interpreted the Board's decision as relying on the "expansive and flexible approach" that permits a court (or the Board) to "take account of the inferences and creative steps that a person of ordinary skill in the art would employ" under KSR Int'l. Co. v. Teleflex. Inc., 550 U.S. at 415, 418. It was enough according to the Board, that Feldman disclosed the five-layer electrode claimed by the '193 patent; having disclosed other "alternative" configurations did not negate this disclosure for an obviousness determination.
Lastly, DexCom argued that the Board was incorrect for considering Figure 4A as prior art because the filed application, which was properly prior art and had fewer clear-cut drawings, qualified but the published application should not. DexCom and the panel recognized that this would require the Court to adopt a new evidentiary rule in IPRs, but the panel was able to avoid ruling on this issue on the grounds that DexCom waived the argument by not raising it post-institution (despite having done so in its pre-institution response, citing Parus Holdings, Inc. v. Google LLC, 70 F.4th 1365, 1373 (Fed. Cir. 2023), for the rubric that "[b]y raising an argument in its Preliminary Response, but not its Response, a patent owner waives said argument").
* The opinion recites the patent number as 10,792,193; the correct patent number is 10,702,193.
** As set forth in a footnote, Abbott Diabetes Care, Inc. withdrew from the appeal prior to oral argument, and Acting Director Coke Morgan Stewart intervened in the appeal, relying on Abbott's brief.
DexCom, Inc. v. Stewart (Fed. Cir. 2025)
Nonprecedential disposition
Panel: Chief Judge Moore, Circuit Judge Stoll, and District Judge Wang
Opinion by District Judge Wang
[View source.]
