Court Opinion

ID: 4707419
Source: CourtListenerOpinion
Date Created: 2021-07-29 15:03:17.10645+00
Date Added: 2024-06-11T08:06:44.164516
License: Public Domain

Case: 20-1346   Document: 70     Page: 1   Filed: 07/29/2021

        NOTE: This disposition is nonprecedential.

   United States Court of Appeals
       for the Federal Circuit
                 ______________________

                  MAGSEIS FF LLC,
                     Appellant

                            v.

         SEABED GEOSOLUTIONS (US) INC.,
                    Appellee

   ANDREW HIRSHFELD, PERFORMING THE
    FUNCTIONS AND DUTIES OF THE UNDER
       SECRETARY OF COMMERCE FOR
 INTELLECTUAL PROPERTY AND DIRECTOR OF
 THE UNITED STATES PATENT AND TRADEMARK
                   OFFICE,
                   Intervenor
             ______________________

                  2020-1346, 2020-1348
                 ______________________

     Appeals from the United States Patent and Trademark
 Office, Patent Trial and Appeal Board in Nos. IPR2018-
 00961, IPR2018-00962.
                  ______________________

                 Decided: July 29, 2021
                 ______________________

    JEFFREY COSTAKOS, Foley & Lardner LLP, Milwaukee,
 WI, for appellant. Also represented by RUBEN JOSE
Case: 20-1346    Document: 70       Page: 2   Filed: 07/29/2021

 2           MAGSEIS FF LLC   v. SEABED GEOSOLUTIONS (US) INC.

 RODRIGUES, Boston, MA.

     JOHN R. LANE, Fish & Richardson P.C., Houston, TX,
 for appellee. Also represented by DANIELLE J. HEALEY,
 BRIAN GREGORY STRAND.

     ROBERT MCBRIDE, Office of the Solicitor, United States
 Patent and Trademark Office, Alexandria, VA, for interve-
 nor. Also represented by THOMAS W. KRAUSE, WILLIAM
 LAMARCA, FARHEENA YASMEEN RASHEED.
                 ______________________

     Before MOORE, Chief Judge, LINN and CHEN, Circuit
                          Judges.
 MOORE, Chief Judge.
     Magseis FF LLC appeals two final written decisions of
 the Patent Trial and Appeal Board holding that certain
 claims of U.S. Patent Nos. 8,228,761 and 8,879,362 would
 have been obvious. Seabed Geosolutions (US), Inc. v.
 Magseis FF LLC, No. IPR2018-00961, 2019 WL 5777754
 (P.T.A.B. Nov. 5, 2019) (Board Decision); Seabed Geosolu-
 tions (US), Inc. v. Magseis FF LLC, No. IPR2018-00962,
 2019 WL 5802500 (P.T.A.B. Nov. 6, 2019). Because sub-
 stantial evidence supports the Board’s fact findings, we af-
 firm.
                        BACKGROUND
     The ’761 and ’362 patents are directed to an ocean bot-
 tom seismometer (OBS) for use in seismic exploration. ’761
 patent at Abstract. 1 Seismic exploration generally involves
 sending an acoustic signal into the earth and using seismic
 receivers called geophones to detect “seismic reflections”
 from subsurface structures. Id. at 1:12–23, 32–37. The

     1   The ’761 and ’362 patents share the same specifica-
 tion.
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 MAGSEIS FF LLC   v. SEABED GEOSOLUTIONS (US) INC.           3

 patents describe an OBS that is “self[-]contained such that
 all of the electronics are disposed within the case, including
 a multi-directional geophone package, a seismic data re-
 cording device, a power source and a clock.” Id. at 10:35–
 38. The patents further describe the case as “disk-shaped,”
 i.e., “symmetrical about the [vertical] axis” and having “a
 very low height profile.” Id. at 10:4–9. Figures 1 and 2
 below illustrate this shape:

    Each independent claim of the ’761 and ’362 patents
 requires a “disk-shaped case” containing all components of
 an OBS. Claim 1 of the ’761 patent, for example, recites:
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 4           MAGSEIS FF LLC   v. SEABED GEOSOLUTIONS (US) INC.

     1. An ocean bottom seismic data collection system
     comprising:
         a. a disk-shaped case;
         b. at least one geophone disposed within
         said case;
         c. a clock disposed within said case;
         d. a power source disposed within said case;
         and
         e. a seismic data recorder disposed within
         said case.
      Magseis’ predecessor 2 sued Seabed Geosolutions (US)
 Inc. for patent infringement in the United States District
 Court for the Southern District of Texas. Seabed petitioned
 for inter partes review of claims 1–24 of the ’761 patent and
 claims 1–17 of the ’362 patent. The Board instituted review
 and held that all challenged claims, except claim 8 of the
 ’761 patent, would have been obvious. Magseis appeals.
 We have jurisdiction under 28 U.S.C. § 1295(a)(4)(A).
                         DISCUSSION
     We review the Board’s ultimate obviousness determi-
 nation de novo and its subsidiary factual findings for sub-
 stantial evidence. PersonalWeb Techs., LLC v. Apple, Inc.,
 917 F.3d 1376, 1381 (Fed. Cir. 2019). Relevant here, fac-
 tual findings underlying an obviousness determination in-
 clude: (1) whether a skilled artisan would have been
 motivated to modify the teachings of a reference, and (2)
 whether there is a nexus between secondary considerations

     2   Fairfield Industries Inc. transferred all relevant
 assets to Fairfield Seismic LLC, which changed its name to
 Magseis FF LLC. Appellant’s Br. 1 n.1.
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 MAGSEIS FF LLC   v. SEABED GEOSOLUTIONS (US) INC.          5

 of nonobviousness and the claimed invention. WBIP, LLC
 v. Kohler Co., 829 F.3d 1317, 1327, 1332 (Fed. Cir. 2016).
                               I.
     The Board held that claim 1 of the ’761 patent would
 have been obvious over Mattaboni 3 in combination with
 Sutton, 4 Schmalfeldt, 5 and Jones. 6 Board Decision, 2019
 WL 5777754, at *10. 7 Magseis argues that a skilled artisan
 would not have been motivated to modify Mattaboni in
 view of Sutton, Schmalfeldt, and Jones. Substantial evi-
 dence supports the Board’s contrary finding.
     The Board found, and Magseis does not challenge, that
 Mattaboni discloses each claim limitation except “a disk-
 shaped case.” Mattaboni instead discloses a tall cylindrical
 case. Mattaboni at 2–3, 8. Mattaboni’s Figure 1, which
 labels the cylindrical case as a pressure case, is shown be-
 low:

    3    Mattaboni, Paul J., MITOBS: A Seismometer Sys-
 tem for Ocean-Bottom Earthquake Studies, MARINE
 GEOPHYSICAL RESEARCHES 3 (1977) 87–102.
     4   Sutton, George H., Optimum Design of Ocean Bot-
 tom Seismometers, MARINE GEOPHYSICAL RESEARCHES 9
 (1987) 47–65.
     5   Schmalfeldt, Bernd, Explosion-Generated Seismic
 Interface Waves in Shallow Water, SACLANTCEN Report
 SR-71, July 1, 1983.
     6   U.S. Patent No. 6,951,138.
     7   We cite only the ’961 IPR decision because the ’962
 IPR decision is substantively identical regarding the issues
 Magseis raises.
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       Substantial evidence supports the Board’s finding that
 a skilled artisan would have been motivated to modify Mat-
 taboni to use a disk-shaped case. As the Board found, Sut-
 ton discloses the desirability of a disk-shaped OBS case.
 See Sutton at 16–17 (“[A]n ocean bottom seismometer
 should be designed with . . . low height-to-base area ratio
 . . . and maximum symmetry about the vertical axis.”); see
 also id. at Abstract (stating that an OBS design should
 have “a low profile and . . . maximum symmetry about the
 vertical axis”). Sutton explains that low profile and sym-
 metry about the vertical axis decrease signal distortion
 from “cross coupling.” Id. at 17–18. Further, as the Board
 found, Schmalfeldt and Jones disclose disk-shaped OBS
 cases. See, e.g., Schmalfeldt at 7, Fig. 3; Jones at Abstract,
 Figs. 1–2. Magseis argues that Jones’ external fins and de-
 ployment system yield “an implausible system that no
 [skilled artisan] would seriously consider.” Appellant’s Br.
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 MAGSEIS FF LLC   v. SEABED GEOSOLUTIONS (US) INC.          7

 40–41. However, the Board did not rely on Jones’ fins or
 deployment system, and obviousness does not require in-
 corporating all teachings of one reference into another. Al-
 lied Erecting & Dismantling Co. v. Genesis Attachments,
 LLC, 825 F.3d 1373, 1381 (Fed. Cir. 2016). The Board’s
 finding that Sutton, Schmalfeldt, and Jones would have
 motivated a skilled artisan to modify Mattaboni to incorpo-
 rate a disk-shaped case is thus supported by substantial
 evidence.
     Substantial evidence also supports the Board’s finding
 that Sutton does not teach away from combination with
 Mattaboni. Although Sutton states that “geophones must
 be separated” from an OBS’s other components, it also dis-
 closes that separating the geophone “may add some com-
 plexity, and possibly result in lower reliability than when
 everything is in one package.” Sutton at 18. Sutton elabo-
 rates that separating the geophone requires external ca-
 bling, which can cause several “problems.” Id. For
 example, cabling can “get caught under the OBS ballast
 and thus prevent the instrument’s return.” Id. Sutton
 therefore provides compelling reasons for combining OBS
 components in the same housing.
     There is evidence, moreover, that Sutton’s rationale for
 separating the geophone (i.e., to avoid distortion from the
 “necessarily massive package that contains power, elec-
 tronics, recording, and recovery equipment,” id.) was obso-
 lete at the time of the invention. Seabed’s expert testified
 that, by 2003, “solid-state memory was available, battery
 technology had improved significantly (allowing for the use
 of smaller, more energy dense batteries), and smaller ver-
 sions of the types of electronic components contained in
 OBS[s]. . . were available.” J.A. 1816 ¶ 69. Seabed’s expert
 further testified that, because of these improvements, “it
 was technically feasible to create OBS[s] with the types of
 components included in Mattaboni’s OBS, but in a
 low[-]profile, symmetrical form factor” in accordance with
 Sutton. Id. Magseis does not dispute that, in 2003, it was
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 8           MAGSEIS FF LLC   v. SEABED GEOSOLUTIONS (US) INC.

 feasible to fit all OBS components in the same housing, as
 Mattaboni teaches, and still comply with Sutton’s design
 parameters. See Appellant’s Br. 36–37; Appellant’s Reply
 Br. 8–9. Accordingly, substantial evidence supports the
 Board’s finding that Sutton does not teach away from com-
 bination with Mattaboni.
     We do not agree with Magseis that the Board applied
 the wrong legal standard in finding that Sutton does not
 teach away. Magseis cites the Board’s statement that “Sut-
 ton cannot be read as stating that under no circumstances
 should other components be combined with the geophones.”
 Board Decision, 2019 WL 5777754, at *20. That statement,
 however, was in response to Magseis’ argument that Sut-
 ton “forbids” such combination. Id. The Board was not
 suggesting that, to teach away, a reference must state the
 claimed invention should never be attempted.
     In sum, substantial evidence supports the Board’s find-
 ing that a skilled artisan would have been motivated to
 modify Mattaboni to use a disk-shaped case, as Sutton,
 Schmalfeldt, and Jones teach. Substantial evidence fur-
 ther supports the Board’s finding that Sutton does not
 teach away from combination with Mattaboni.
                               II.
     The Board found that Magseis failed to show a nexus
 between its evidence of secondary considerations and the
 claimed invention. Because substantial evidence supports
 that finding, the Board correctly rejected the evidence of
 secondary considerations.
     Evidence of secondary considerations must have a
 nexus to the claims. Fox Factory, Inc. v. SRAM, LLC, 944
 F.3d 1366, 1373 (Fed. Cir. 2019). We presume a nexus
 when the evidence is tied to a specific product that is “co-
 extensive” with the claimed invention, for example, be-
 cause “the unclaimed features amount to nothing more
 than additional insignificant features.” Id. at 1373–74.
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 MAGSEIS FF LLC   v. SEABED GEOSOLUTIONS (US) INC.          9

 Without the presumption, a patentee may establish nexus
 by showing the secondary considerations evidence is the
 “‘direct result of the unique characteristics of the claimed
 invention,’” id. (quoting In re Huang, 100 F.3d 135, 140
 (Fed. Cir. 1996)), rather than a feature that was “known in
 the prior art,” Ormco Corp. v. Align Technology, Inc., 463
 F.3d 1299, 1312 (Fed. Cir. 2006). Whether there exists a
 presumption of nexus or a nexus in fact are factual ques-
 tions. Fox Factory, 944 F.3d at 1373; WBIP, 829 F.3d at
 1331–32.
     Substantial evidence supports the Board’s finding that
 the presumption of nexus does not arise here. 8 The Board
 found that the relevant products “comprise many more
 components than simply the [claimed] nodes.” Board Deci-
 sion, 2019 WL 5777754, at *27. For example, the Z700 sys-
 tem includes “a specialized ship with a node handler
 system,” and the Z3000 and ZXPLR systems include re-
 motely operated vehicles. Id. Magseis concedes that “the
 conduct of seismic acquisition surveys necessarily involves
 the use of vessels and remotely operated vehicles.” Appel-
 lant’s Br. 45. Magseis does not argue that those unclaimed
 components are insignificant. Accordingly, a reasonable
 trier of fact could find that the presumption of nexus does
 not apply in this case.
     Substantial evidence also supports the Board’s finding
 of no nexus in fact because the evidence of secondary con-
 siderations is not tied to the claimed invention’s unique
 characteristics. See Board Decision, 2019 WL 5777754, at
 *28–31. Regarding skepticism, Magseis concedes that the
 evidence of this secondary consideration is tied to

    8   Though not completely clear, we understand the
 Board to have found that the presumption does not arise
 because it found that Magseis’ products were not coexten-
 sive with the claims. See Board Decision, 2019 WL
 5777754, at *27–28.
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 10          MAGSEIS FF LLC   v. SEABED GEOSOLUTIONS (US) INC.

 “utiliz[ing] an internal geophone within the same case as
 the other components.” Appellant’s Br. 42–43; see also J.A.
 4293 ¶ 175 (Magseis’ expert testifying that “skepticism
 arose from . . . including the sensor package in the same
 case as all the other components”). Magseis likewise con-
 cedes that its evidence of commercial success is due to “‘the
 manner in which [the invention] incorporates a geophone
 sensor into the same case as all other components of the
 system.’” Appellant’s Reply Br. 21–22 (quoting J.A. 4383–
 84 ¶ 143). Because Mattaboni discloses that feature, the
 alleged skepticism and commercial success are irrelevant.
 Ormco, 463 F.3d at 1312 (“[I]f the feature that creates the
 commercial success was known in the prior art, the success
 is not pertinent.”). Magseis fails to argue or demonstrate
 that its other evidence of secondary considerations is
 linked to a unique characteristic of the claimed invention,
 as opposed to known features. See Appellant’s Br. 47–48
 (vaguely arguing secondary considerations were tied to
 “the claimed inventions”). Accordingly, the Board’s fact
 finding of no nexus is supported by substantial evidence.
                        CONCLUSION
     Substantial evidence supports the fact findings under-
 lying the Board’s holding that claims 1–7 and 9–24 of the
 ’761 patent and claims 1–17 of the ’362 patent would have
 been obvious. We therefore affirm the Board’s final written
 decisions.
                        AFFIRMED