ClassCo, Inc., v. Apple, Inc.

September 22, 2016

Federal Circuit No. 2015-1853
Author: Sarah Washburn

In ClassCo, Inc. v. Apple, Inc., the Federal Circuit upheld a finding of obviousness at the Patent Trial and Appeal Board where the combination of prior art would have yielded predictable results, even though the functions of some prior art elements were changed.

Stemming from an inter partes reexamination requested by Apple, the Federal Circuit affirmed a decision by the Patent Trial and Appeal Board invalidating several claims of ClassCo's U.S. Patent No. 6,970,695 (the '695 patent). 

The ClassCo patent relates to a caller announcement system that uses the phone's speaker to verbally announce caller identity information.  The device is installed between a telephone line and the user's telephone so that it does not require a special phone, display screen, or separate speaker to screen calls.  During an incoming call, the user can lift the handset without answering the call.  It then announces the caller identity information over the inside line and the user can answer the call or hang up.

The Board identified U.S. Patent No. 4,894,861 (Fujioka) as prior art.  Fujioka also relates to a caller announcement system that notifies the receiving party by an audible indication of incoming calls.  The Board concluded that Fujioka disclosed all the features of the ClassCo patent except the use of the same "audio transducer" for announcing both a caller's identity and telephone voice signals.  That is, Fujioka disclosed a separate speaker to verbally announce the caller identity information.

The second prior art reference was identified as U.S. Patent No. 5,199,064 (Gulick).  Gulick generally disclosed a hands-free phone that integrates various phone features into a single integrated circuit.  It teaches that use of a speaker that produces audio from multiple sources within the phone system. 

The Board held that the combination of Fujioka and Gulick rendered the claims obvious.  The Board explained that "one of ordinary skill in the art would have been motivated to develop Fujioka's single-speaker embodiment based on Gulick using one speaker to convey different data in a telephone system."

The Federal Circuit agreed and, quoting KSR, affirmed the Board's decision writing that:

KSR does not require that a combination only unite old elements without changing their respective functions…Instead, KSR teaches that '[a] person of ordinary skill is also a person of ordinary creativity, not an automation.'  And it explains that the ordinary artisan recognizes 'that familiar items may have obvious uses beyond their primary purposes, and in many case a person of ordinary skill will be able to fit the teachings of multiple patens together like pieces of a puzzle.'

The court concluded that the combination of the two prior art patents would have resulted in no more than a predictable result.  One of ordinary skill in the art would have been motivated to modify Fujioka to use a single speaker given that Gulick disclosed a speaker that was capable of producing audio from multiple sources within the telephone system.

ClassCo also presented evidence of industry praise and commercial success to show nonobviousness.  The Federal Circuit concluded that the Board erred in not considering some of the evidence of nonobviousness.  Whether a patent claim is invalid as obvious requires consideration of all four Graham factors.  However, the court determined this to be harmless error.  In light of the other three Graham factors, the Board did not error in its ultimate conclusion of obviousness.