Court Opinion

ID: 3159283
Source: CourtListenerOpinion
Date Created: 2015-12-02 16:01:18.547796+00
Date Added: 2024-06-11T12:02:51.526963
License: Public Domain

NOTE: This disposition is nonprecedential.

  United States Court of Appeals
      for the Federal Circuit
                ______________________

        IN RE: HILL-ROM SERVICES, INC.,
                      Appellant
               ______________________

                      2015-1305
                ______________________

    Appeal from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in No. 90/012,399.
                  ______________________

               Decided: December 2, 2015
                ______________________

   GARRET A. LEACH, Kirkland & Ellis LLP, Chicago, IL,
argued for appellant. Also represented by PAUL DANIEL
BOND, BRIAN VERBUS.

    KAKOLI CAPRIHAN, Office of the Solicitor, United
States Patent and Trademark Office, Alexandria, VA,
argued for appellee Michelle K. Lee. Also represented by
NATHAN K. KELLEY, STACY BETH MARGOLIES.
                 ______________________

 Before O’MALLEY, PLAGER, and BRYSON, Circuit Judges.
BRYSON, Circuit Judge.
    This is an appeal from a decision of the Patent Trial
and Appeal Board in an ex parte reexamination proceed-
ing. The Board held various claims of a patent owned by
2                                IN RE: HILL-ROM SERVICES, INC.

appellant Hill-Rom Services, Inc., to be invalid for obvi-
ousness. We affirm.
                             I
    The patent in suit, Hill-Rom’s U.S. Patent No.
5,771,511 (“the ’511 patent”) is entitled “Communication
Network for a Hospital Bed.” The patent is directed to a
hospital bed featuring a peer-to-peer communication
network with a plurality of connection points and mod-
ules. Each module is electrically coupled to a selected
connection point of the communication network, and each
module is configured to communicate over the network
with selected other modules. Each module performs a
specific function relating to the operation of the bed. For
example, different modules can move different portions of
the bed deck in various directions, deflate or inflate the
mattress, calculate the patient’s weight, and detect when
the patient exits the bed.
    Following the reexamination proceeding, the examin-
er rejected various claims of the ’511 patent. The examin-
er rejected each of the claims as obvious in view of certain
combinations of prior art references. Two of the examin-
er’s rejections are at issue on this appeal—the combina-
tion of PCT Application No. WO 94/27544 (“Travis”) and
U.S. Patent No. 5,596,437 (“Heins”); and the combination
of Heins and a 1993 manual published by the Hill-Rom
Company, Inc. (“the Hill-Rom Manual”). The Patent Trial
and Appeal Board affirmed both of those rejections.
    Claim 1 of the ’511 patent is representative. It recites
the following:
    1. A bed comprising:
    a base frame;
    a deck coupled to the base frame for supporting a
    body;
IN RE: HILL-ROM SERVICES, INC.                            3

    a peer-to-peer communication network having a
    plurality of connection points;
    a plurality of modules, each module being electri-
    cally coupled to a selected connection point of the
    peer-to-peer communication network, each module
    being configured to perform a dedicated function
    during operation of the bed, and each module be-
    ing configured to communicate over the peer-to-
    peer communication network with selected other
    modules, and each module including a processor
    circuit configured to transmit information to any
    other module and to receive information from any
    other module over the peer-to-peer communication
    network.
    The Travis reference is directed to an adjustable hos-
pital bed having various modules connected to a serial
communication network. Each module is electrically
coupled to a connection point on the network. The various
modules connect to computers that coordinate the various
functions of the modules, such as measuring the weight of
the patient and determining whether the patient has left
the bed. Travis uses a “master-slave” configuration, in
which a single “master controller” controls the operation
of the various modules.
    The Heins reference is directed to an X-ray device
with a moveable patient table. Heins employs a peer-to-
peer communication network known as the Controller
Area Network (“CAN”) protocol to control the modules, or
“nodes,” on the X-ray device. One of the functions dis-
closed in Heins is moving the patient table, which is done
by sending a command over the network from one node to
another. The command allows the patient table to be
moved in multiple directions. Another function of the
system is to transmit information about the patient table
position so that it can be displayed. The nodes in Heins
are stated to be in mutual communication with other
4                              IN RE: HILL-ROM SERVICES, INC.

nodes, so that each node can transmit data to the other
nodes at any time, without having to wait for authoriza-
tion to transmit. Heins states that systems using the
CAN protocol are capable of high transmission speed and
reliability, and that they allow individual components to
be easily added, substituted, or removed.
    The Hill-Rom Manual discloses an adjustable hospital
bed having a frame and a deck coupled to the frame. The
bed has several modules, each configured to perform a
particular function, such as positioning various portions
of the bed, inflating or deflating the mattress, and weigh-
ing the patient. The Hill-Rom Manual further discloses
that the adjustable features are governed by circuit board
logic and controlled by a control console.
    In rejecting the disputed claims of the ’511 patent as
obvious in view of Travis and Heins, the examiner deter-
mined that it would have been obvious to one of ordinary
skill in the art to substitute the peer-to-peer communica-
tion network taught by Heins for the master-slave net-
work used in Travis.         The motivation for such a
substitution, the examiner explained, would be to obtain
faster processing speeds and reliable transmission of
data, while retaining the ability to add or delete subsys-
tems easily.
     The Board upheld the examiner’s rejection in view of
Travis and Heins. In so doing, the Board upheld without
comment the examiner’s conclusion that Travis was prior
art to the ’511 patent, although that issue was sharply
contested by the parties. See 37 C.F.R. § 41.50(a)(1) (“The
affirmance of the rejection of a claim on any of the
grounds specified constitutes a general affirmance of the
decision of the examiner on that claim, except as to any
ground specifically reversed.”). The examiner found
unpersuasive Hill-Rom’s evidence that its inventors
conceived of the invention prior to the filing date of Travis
and that the inventors exhibited diligence from that time
IN RE: HILL-ROM SERVICES, INC.                          5

until they constructively reduced the invention to prac-
tice.
     The Board analyzed Travis and Heins, and it conclud-
ed that the disputed claims would have been obvious in
light of the combination of those references. The Board
then moved to the examiner’s second ground of rejection,
which was that the disputed claims would have been
obvious in light of Heins and the Hill-Rom Manual. On
that issue, the Board held that the examiner was correct
in finding that the Hill-Rom Manual discloses a communi-
cation network in connection with a hospital bed. The
combination of the Hill-Rom Manual and the peer-to-peer
network of Heins, the Board held, rendered the disputed
claims of the ’511 patent obvious.
    The Board further ruled that, even if the Hill-Rom
Manual were not regarded as having disclosed a commu-
nication network, the claims would still be rendered
obvious by combining Heins’s peer-to-peer network with
the Hill-Rom Manual’s teachings of a user-controlled bed.
The Board found that, like the X-ray device described in
Heins, the bed disclosed in the Hill-Rom Manual requires
user input to be adjusted. The Board then concluded that
it would have been obvious to implement Heins’s commu-
nication network in the bed described in the Hill-Rom
Manual so as to control the bed in the manner described
in the ’511 patent.
                                 II
    On appeal, Hill-Rom focuses much of its attention on
the examiner’s finding that Travis was prior art to the
’511 patent. Hill-Rom argues that the examiner was
incorrect in finding that Hill-Rom had failed to show both
prior conception and diligence from before the filing date
of Travis until the filing of the application for the ’511
patent.
6                              IN RE: HILL-ROM SERVICES, INC.

    We find it unnecessary to reach that question, be-
cause the Board’s second ground for decision, based on the
combination of Heins and the Hill-Rom Manual, provides
a sufficient basis for upholding the Board’s decision.
    With respect to the combination of Heins and the Hill-
Rom Manual, Hill-Rom first contends that the Board
erred in finding a motivation to combine the two refer-
ences. In particular, Hill-Rom challenges the Board’s
reliance on the disclosure that the peer-to-peer communi-
cation network in Heins offered “greater processing
speeds” than conventional communication networks. Hill-
Rom’s argument is that Heins does not expressly disclose
that the processing speeds in its peer-to-peer system are
greater than the processing speeds in, for example, a
master-slave network such as Travis.
     Hill-Rom acknowledges that Heins touts the high
transmission speed of its peer-to-peer controller area
network and the “high transmission reliability” of that
system. See Heins abstract (CAN protocol results in “fast
and reliable data transmission”); col. 1, ll. 30-35 (“Accord-
ing to the CAN protocol, each node can transmit data to
each of the other nodes at any time (Multimaster princi-
ple) without having to wait for an authorization to trans-
mit. The exchange of information accordingly takes place
very quickly . . . .”); id., ll. 36-54 (“data nodes working in
accordance with the CAN protocol have a high transmis-
sion speed as well as a high transmission reliability”); col.
2, ll. 6-11 (“individual components can be changed in a
simple manner while a high data speed is maintained”);
id., ll. 24-25 (“high access speed to other nodes [is] provid-
ed by systems according to the CAN protocol”). Hill-Rom
argues, however, that the references in Hein to “high
transmission speed” do not provide a motivation to com-
bine Heins with prior art systems not involving peer-to-
peer networks, because Heins did not say that the “high”
transmission speeds were “higher” than the speeds
achieved in other systems.
IN RE: HILL-ROM SERVICES, INC.                            7

    We do not find Hill-Rom’s argument persuasive.
From context, it is clear that the statements in Heins
about the system’s high transmission speed were meant
to make the point that the system was faster than con-
ventional systems, as the examiner found. At minimum,
that inference was a fair one for the examiner to draw
from Heins. 1 Moreover, the Board did not rely solely on
the greater speed of the peer-to-peer network as giving
rise to a motivation to use the Heins network to control a
hospital bed. It noted that in addition to increased speed,
the examiner had found that a skilled worker would have
had reason to use the peer-to-peer network because of its
greater reliability and its ability to easily add or delete
subsystems or modules.
    Hill-Rom next contends that there was no evidence in
the reexamination proceeding that a person of ordinary
skill in the art in 1994 had the ability to implement
Heins’s network on a hospital bed. In support of its
argument, Hill-Rom points to the declaration of Michael
J. Hayes, an engineer for Stryker Corporation, the third-
party requester of the reexamination. In particular, Hill-
Rom notes that although Mr. Hayes said that his compa-
ny chose the CAN network protocol because of the various
advantages of that system, he stated that the company
had “worked with a third-party design firm to assist in
the design and implementation of the CAN network on
our hospital beds.” According to Hill-Rom, that statement
belies Mr. Hayes’s declaration that a person of skill in the
art had the capacity to adapt the CAN network to a
hospital bed.

    1     The examiner also cited U.S. Patent No. 4,992,926
(“Janke”) to show that a peer-to-peer communication
network could be substituted for a master-slave network
in order to provide greater processing speeds. See Janke,
col. 1, ll. 58-64; col. 2, ll. 6-12.
8                              IN RE: HILL-ROM SERVICES, INC.

    The Board noted that Mr. Hayes testified that he had
engaged a third-party firm to implement the CAN design
because it was more cost effective than implementing the
design in-house, not because implementing the design
was beyond the skill of an ordinary artisan. That expla-
nation is reasonable, and the Board was not required to
conclude that Mr. Hayes’s decision to work with a third-
party design firm indicates that a person of skill in the art
could not have adapted the CAN network to a hospital
bed.
    In finding that a person of ordinary skill would have
been able to adapt the Heins peer-to-peer network to the
Hill-Rom bed, the examiner and the Board were entitled
to consider the similarity between the Heins X-ray system
and the Hill-Rom hospital bed. As Heins explains, the
various modules in the Heins network move the X-ray
table in various ways, including tilting it, moving it
laterally, and moving it longitudinally. Besides the fact
that both the X-ray table and the hospital bed are adjust-
able medical devices designed to support a patient’s body,
the functions performed by the modules in Heins are very
similar to the functions performed by the modules in the
Hill-Rom system, which includes moving the bed frame in
various directions and angles. Given the similarity in the
roles played by the modules in the two systems, it was
reasonable for the examiner and the Board to conclude
that adapting the Heins peer-to-peer network to the Hill-
Rom bed was within the capacity of a person of ordinary
skill at the time of the invention. 2

    2   In addition to Heins, the examiner noted that a
1994 article by van Woerden taught that the use of a CAN
communication system as a peer-to-peer network was
known to be well suited for medical rehabilitation applica-
tions, such as a wheelchair.
IN RE: HILL-ROM SERVICES, INC.                            9

                             III
    Hill-Rom next contends that the Board relied on an
unreasonable construction of the term “communication
network” when it affirmed the examiner’s finding that it
would have been obvious for one of ordinary skill in the
art to substitute the peer-to-peer communication network
taught by Heins for the network in the Hill-Rom Manual.
     Importantly, the Board regarded the combination of
Heins and the Hill-Rom Manual to render the disputed
claims obvious regardless of whether the electrical net-
work described in the Hill-Rom Manual is considered a
“communication network.” The electrical network dis-
closed in the Hill-Rom Manual has to be assessed for what
it is, not for what it is called. The question whether the
Board was correct to call it a “communication network”
therefore does not affect the Board’s analysis. What the
Hill-Rom Manual discloses is a hospital bed with a num-
ber of modules that are controlled by an electrical system.
Hill-Rom complains that the electrical control system
described in the Hill-Rom Manual is too remote from the
control system recited in the disputed claims, because the
control system of the Hill-Rom Manual operates through
simple changes in logical states, not more complex signals
that Hill-Rom refers to as “communications.”
    While it may be reasonable to regard a system that
communicates directions to its various modules though
changes in logical states as a simple form of communica-
tion network, it is not necessary to characterize the dis-
closure of the Hill-Rom Manual in that manner. What
matters is whether it was reasonable for the Board to find
that it would have been obvious for a person of skill in the
art to implement the peer-to-peer network of Heins to
perform the control functions on the multi-module electri-
cally controlled hospital bed described in the Hill-Rom
Manual. For the reasons given by the Board, we conclude
that it was.
10                            IN RE: HILL-ROM SERVICES, INC.

    The Board noted that a Hill-Rom engineer described
in some detail the electrical control system disclosed in
the Hill-Rom Manual. He explained that the logic control
board of the system receives signals “indicative of user
inputs from the siderails and the footboard [of the hospi-
tal bed] and according to predefined logic, determines
whether to operate the various motors on the bed.” The
logic control board ultimately operates the various motors
on the bed that perform the designed functions or detect
particular conditions on the bed.
    The Board concluded that even if that electrical con-
trol system is not regarded as a “communication net-
work,” the bed of the Hill-Rom Manual “still requires user
input to be adjusted as does the X-ray device in Heins.”
Based on its extensive analysis of Heins at an earlier
point in its opinion, the Board upheld the examiner’s
finding “that it would have been obvious to implement
Heins’s communication network in the bed described in
the Hill-Rom Manual for its known and expected func-
tions in controlling a medical device.” 3
    We sustain the Board’s decision on that ground. The
evidence regarding Heins showed that it satisfied the

     3  In particular, the examiner found that “using
known methods of engineering, a person of ordinary skill
in the art could have added a prior art communication
network to a hospital bed, and the results of such a com-
bination would have been predictable. Those results
would have been predictable because communication
networks were known to operate in predictable, well-
understood ways in a variety of different fields, including
the medical field.” Moreover, the examiner noted that the
claims of the ’511 patent were broadly directed a peer-to-
peer network and that the specification “does not describe
any significant modifications required to allow a peer-to-
peer network to work in a hospital bed.”
IN RE: HILL-ROM SERVICES, INC.                             11

limitations of the disputed claims regarding the peer-to-
peer communication network and the “plurality of mod-
ules . . . electrically coupled to a selected connection point
of the peer-to-peer communication network.” ’511 patent,
col. 22, ll. 20-23. The evidence regarding the Hill-Rom
Manual showed that it satisfied the limitations of the
disputed claims regarding the bed with an articulating
deck coupled to the frame having discrete movable sec-
tions.
    The issue for the examiner and the Board was wheth-
er it would have been obvious for a person of skill at the
time of the invention to combine those references. We
hold that the Board properly sustained the examiner’s
conclusion that the disputed claims would have been
obvious in light of the Hill-Rom Manual and Heins. The
Board’s decision was justified in light of the examiner’s
findings that (1) the bed of the Hill-Rom Manual already
had an electrical control system controlling its various
functions, such as moving the sections of the bed and
weighing the patient; (2) the X-ray device of Heins had a
peer-to-peer communication network that controlled the
functions of the system, including moving the patient
table in various ways; and (3) the peer-to-peer communi-
cation network had known advantages over other com-
munication networks, such as master-slave networks.
                             IV
    Hill-Rom raises a separate legal argument with re-
spect to the Board’s decision that the disputed claims
would have been obvious in light of the Hill-Rom Manual
and Heins even if the electrical control system of the Hill-
Rom Manual were not considered a “communication
network.” Hill-Rom argues that the Board’s decision in
that regard constituted a new ground of rejection and for
that reason the Board’s decision cannot be sustained on
that ground.
12                            IN RE: HILL-ROM SERVICES, INC.

    In response, the Director of the Patent and Trade-
mark Office (“PTO”) points out that, by regulation, a
party that wishes to raise the claim that the Board has
adopted a new ground of rejection must do so by filing a
request for rehearing before the Board. Failure to file a
timely request for rehearing, according to the regulation,
“will constitute a waiver of any arguments that a decision
contains an undesignated new ground of rejection.” 37
C.F.R. § 41.50(c). 4
    Hill-Rom admits that it did not file a request for re-
hearing on the “new ground of rejection” issue. Moreover,
it does not argue that the regulation is somehow inappli-
cable to the facts of this case. Rather, it argues that the
regulation is invalid “because it restricts this Court’s
ability to review a final decision over which the Court has
jurisdiction.”
    We reject Hill-Rom’s legal challenge to the regulation.
Under well-settled principles of administrative law,
parties who seek to raise issues on judicial review of
administrative action ordinarily must first exhaust their
administrative remedies by raising those issues before the
agency in accordance with the prescribed administrative
procedures. See Woodford v. Ngo, 548 U.S. 81, 88-90
(2006); McKart v. United States, 395 U.S. 185, 193 (1969);
United States v. L.A. Tucker Truck Lines, 344 U.S. 33, 37
(1952). Congress has authorized the PTO to promulgate
regulations governing “the conduct of proceedings in the
Office,” 35 U.S.C. § 2(b)(2)(A). Pursuant to that authority,
the PTO issued its regulation requiring parties to raise
“new ground of rejection” arguments through petitions for

     4  The current version of 37 C.F.R. § 41.50(c) was
promulgated after this court’s decision in In re Stepan Co.,
660 F.3d 1341 (Fed. Cir. 2011). As Hill-Rom acknowledg-
es, the current version of the regulation applies to this
case.
IN RE: HILL-ROM SERVICES, INC.                           13

rehearing. 37 C.F.R. § 41.50(c). That regulation imposes
a binding exhaustion requirement on parties seeking to
raise such arguments on judicial review. See Sims v.
Apfel, 530 U.S. 103, 108 (2000) (“[I]t is common for an
agency’s regulations to require issue exhaustion in admin-
istrative appeals.”). And when regulations do so, “courts
reviewing agency action regularly ensure against the
bypassing of that requirement by refusing to consider
unexhausted issues.” Id. Applying those principles, this
court has declined to address issues that were not raised
on a timely basis before the Board of Patent Appeals and
Interferences (now the Patent Trial and Appeal Board).
In re DBC, 545 F.3d 1373, 1378-79 (Fed. Cir. 2008).
    Both the Supreme Court and this court have ex-
plained that the exhaustion requirement serves two
important policies.    First, it protects administrative
agency authority by giving the agency “an opportunity to
correct its own mistakes with respect to the programs it
administers before it is haled into federal court,” and by
discouraging “disregard of [the agency’s] procedures.”
McCarthy v. Madigan, 503 U.S. 140, 145 (1992). Second,
it promotes efficiency because it allows claims to be re-
solved more quickly and economically before the agency,
rather than through litigation in federal court. Id.; see
also Palladian Partners, Inc. v. United States, 783 F.3d
1243, 1254-55 (Fed. Cir. 2015).
    The PTO’s rule requiring “new ground of rejection”
claims to be first raised before the Board rather than this
court serves both of those purposes. First, it gives the
Board an opportunity to address the claim and provide a
response to the assertion that the ground of rejection is
new. Second, it allows for the efficient disposition of that
issue before the agency; the agency might either sustain
the objection or explain, perhaps to the satisfaction of the
patentee, that the ground of rejection was not, in fact,
new. And even if court review follows, “exhaustion of the
administrative procedure may narrow the issues and
14                             IN RE: HILL-ROM SERVICES, INC.

‘produce a useful record for subsequent judicial considera-
tion.’” Palladian Partners, 783 F.3d at 1255, quoting
Woodford, 548 U.S. at 89.
    In its brief, Hill-Rom does not cite any of this authori-
ty. Instead, relying on Adams Fruit Co. v. Barrett, 494
U.S. 638 (1990), and Nagahi v. INS, 219 F.3d 1168 (10th
Cir. 2000), Hill-Rom contends that the PTO’s regulation
requiring exhaustion of “new ground of rejection” claims
is unlawful because it imposes an impermissible re-
striction on the court’s jurisdiction.
    Those cases provide no support for Hill-Rom’s posi-
tion. In Adams Fruit, the Supreme Court declined to
defer to the views of the Department of Labor as to
whether a federal statute creating a private right of
action preempted a state statute creating an exclusive
administrative remedy. The Court explained that “Con-
gress has expressly established the Judiciary and not the
Department of Labor as the adjudicator of private rights
of action arising under the statute,” and that it would be
“inappropriate to consult executive interpretations of [the
statute] to resolve ambiguities surrounding the scope of
[the statute’s] judicially enforceable remedy. 494 U.S. at
649-50. That decision does nothing to change the well-
settled principle that a party must exhaust its adminis-
trative remedies before raising a particular issue on
judicial review of an agency’s decision.
    The Nagahi case is likewise inapposite. In that case,
the Tenth Circuit held that the Immigration and Natural-
ization Service could not impose a statute of limitations
on judicial review that was shorter than the limitations
period provided by the Administrative Procedure Act.
Thus, the Nagahi case stands for the unsurprising princi-
ple that an agency rule cannot override a statutory provi-
sion. Nothing in that case suggests that the requirement
of exhausting administrative remedies impermissibly
intrudes on the jurisdiction of the reviewing court. Sub-
IN RE: HILL-ROM SERVICES, INC.                          15

sequent decisions by the Tenth Circuit make clear that
exhaustion requirements are fully applicable to proceed-
ings before the Immigration and Naturalization Service.
See Garcia-Carbajal v. Holder, 625 F.3d 1233, 1236-38
(10th Cir. 2010) (“It is a fundamental principle of admin-
istrative law that an agency must have the opportunity to
rule on a challenger’s arguments before the challenger
may bring those arguments to court.”); Torres de la Cruz
v. Maurer, 483 F.3d 1013, 1022 (10th Cir. 2007) (“On a
petition for review to this court, we will not permit the
petitioner to circumvent proper procedural requirements
of the [Board of Immigration Appeals] by presenting
contentions that were procedurally barred by the Board.”);
Galvez Pineda v. Gonzalez, 427 F.3d 833, 837 (10th Cir.
2005) (“Failure to exhaust administrative remedies by not
first presenting a claim to the [Board of Immigration
Appeals] deprives this court of jurisdiction to hear it.”).
    There is nothing unreasonable about the PTO’s rule
requiring that “new ground of rejection” claims be raised
in a request for rehearing. It is far more efficient to
proceed in that manner than to have the case proceed to
judicial review and then have the “new ground of rejec-
tion” issue decided without input from the Board. Accord-
ingly, we hold that by failing to file a petition for
rehearing, Hill-Rom has waived its “new ground of rejec-
tion” claim.
                        AFFIRMED