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Objective Indicia Of Nonobviousness Do Not Necessarily Overcome A Strong Showing Of Obviousness

Client Alert | 2 min read | 10.15.08

In Asyst Technologies, Inc. v. Emtrak, Inc. (No. 2007-1554; October 10, 2008), the Federal Circuit affirms a district court's grant of judgment as a matter of law that United States Patent No. 5,097,421 ("'421 patent") is invalid due to obviousness.

The '421 patent provides a system for tracking articles in a manufacturing facility using transportable processing units to carry the articles of manufacture. The transportable units are capable of storing data regarding the status of the articles it contains. The '421 patent uses a multiplexer to communicate between a particular processing unit and the central control unit to ensure that fabrication steps are followed in the correct order. The Hesser patent teaches the same system except that it employs a bus which routes communication from a central control unit to every connected device. The only material difference between the '421 patent and the Hesser patent is the substitution of the multiplexer for the bus as a method of non-contact communication.

The district court granted defendant Jenoptik's motion for judgment as a matter of law that the '421 patent was invalid as obvious in view of the Hesser patent. The district court concluded that the patent validity verdict was fundamentally undermined by the jury's erroneous conclusion that the Hesser patent was not relevant prior art. The Federal Circuit agrees. Asyst contended that since Hesser teaches indiscriminate information transmission to all processing units, the '421 patent produces the unexpected result of saving battery life by communicating with only one unit at a time. However, Jenoptik produced credible evidence that multiplexers and their advantages and disadvantages were well known and well understood by persons of skill in the art at the time of the '421 patent application. In view of the Supreme Court's decision in KSR Int'l Co. v. Teleflex, Inc., 127 S. Ct. 1727 (2007), the Court holds that replacing the bus with the multiplexer is "little more than the simple substitution of one known element for another." Asyst raised objective indicia of nonobviousness including commercial success, long-felt need, and industry praise as sufficient support for the jury's patent validity verdict. However, Asyst failed to attribute the objective indicia to the substitution of the multiplexer for the bus. Thus, the Federal Circuit concludes that this failure undermined the probative force of the secondary evidence. Consequently, it was obvious to a person of ordinary skill in the art to replace the bus in Hesser with a multiplexer, and the objective indicia of nonobviousness were insufficient to overcome the strong showing of obviousness in this case.

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Client Alert | 4 min read | 08.07.25

File First, Facts Later? Eleventh Circuit Says That Discovery Can Inform False Claims Act Allegations in Amended Complaints

On July 25, 2025, the Eleventh Circuit Court of Appeals issued its decision in United States ex. rel. Sedona Partners LLC v. Able Moving & Storage Inc. et al., holding that a district court cannot ignore new factual allegations included in an amended complaint filed by a False Claims Act qui tam relator based on the fact that those additional facts were learned in discovery, even while a motion to dismiss for failure to comply with the heightened pleading standard under Federal Rule of Civil Procedure 9(b) is pending.  Under Rule 9(b), allegations of fraud typically must include factual support showing the who, what, where, why, and how of the fraud to survive a defendant’s motion to dismiss.  And while that standard has not changed, Sedona gives room for a relator to file first and seek out discovery in order to amend an otherwise deficient complaint and survive a motion to dismiss, at least in the Eleventh Circuit.  Importantly, however, the Eleventh Circuit clarified that a district court retains the discretion to dismiss a relator’s complaint before or after discovery has begun, meaning that district courts are not required to permit discovery at the pleading stage.  Nevertheless, the Sedona decision is an about-face from precedent in the Eleventh Circuit, and many other circuits, where, historically, facts learned during discovery could not be used to circumvent Rule 9(b) by bolstering a relator’s factual allegations while a motion to dismiss was pending.  While the long-term effects of the decision remain to be seen, in the short term the decision may encourage relators to engage in early discovery in hopes of learning facts that they can use to survive otherwise meritorious motions to dismiss....

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