Court Opinion

ID: 9892302
Source: CourtListenerOpinion
Date Created: 2023-10-23 14:01:08.305529+00
Date Added: 2024-06-11T08:03:31.298524
License: Public Domain

Case: 20-1141     Document: 124   Page: 1     Filed: 10/23/2023

         NOTE: This disposition is nonprecedential.

    United States Court of Appeals
        for the Federal Circuit
                   ______________________

                INTEX RECREATION CORP.,
                        Appellant

                  BESTWAY (USA), INC.,
                       Appellee

                             v.

         TEAM WORLDWIDE CORPORATION,
                 Cross-Appellant

   KATHERINE K. VIDAL, UNDER SECRETARY OF
   COMMERCE FOR INTELLECTUAL PROPERTY
     AND DIRECTOR OF THE UNITED STATES
       PATENT AND TRADEMARK OFFICE,
                   Intervenor
             ______________________

  2020-1141, 2020-1142, 2020-1143, 2020-1149, 2020-1150,
                        2020-1151
                 ______________________

     Appeals from the United States Patent and Trademark
 Office, Patent Trial and Appeal Board in Nos. IPR2018-
 00870, IPR2018-00871, IPR2018-00872, IPR2018-00873,
 IPR2018-00874.
                  ______________________

                  Decided: October 23, 2023
                   ______________________
Case: 20-1141   Document: 124    Page: 2   Filed: 10/23/2023

 2   INTEX RECREATION CORP. v. TEAM WORLDWIDE CORPORATION

     R. TREVOR CARTER, Faegre Drinker Biddle & Reath
 LLP, Indianapolis, IN, argued for appellant and appellee.
 Appellant Intex Recreation Crop. also represented by REID
 E. DODGE, ANDREW M. MCCOY.

     JOHN S. ARTZ, Dickinson Wright PLLC, Ann Arbor, MI,
 for appellee. Also represented by STEVEN A. CALOIARO,
 Reno, NV.

     ROBERT M. HARKINS, JR., Cherian LLP, Berkeley, CA,
 argued for cross-appellant. Also represented by TIMOTHY
 E. BIANCHI, Schwegman Lundberg & Woessner, PA, Min-
 neapolis, MN.

     THOMAS W. KRAUSE, Office of the Solicitor, United
 States Patent and Trademark Office, Alexandria, VA, for
 intervenor.   Also represented by DANIEL KAZHDAN,
 FARHEENA YASMEEN RASHEED.
                 ______________________

     Before LOURIE, DYK, and TARANTO, Circuit Judges.
 LOURIE, Circuit Judge.
     Intex Recreational Corporation (“Intex”) appeals from
 two decisions of the U.S. Patent and Trademark Office Pa-
 tent Trial and Appeal Board (“the Board”) holding that
 claims 1−12 and 16−23 of U.S. Patent 7,246,394 were not
 shown to have been unpatentable as obvious. Intex Recre-
 ational Corp. v. Team Worldwide Corp., No. IPR2018-
 00872 (P.T.A.B. Sept. 11, 2019), J.A. 274−346 (“872 Deci-
 sion”); Intex Recreational Corp. v. Team Worldwide Corp.,
 No. IPR2018-00873 (P.T.A.B. Oct. 18, 2019), J.A. 347−406
 (“873 Decision”).
    Team Worldwide Corporation (“Team Worldwide”)
 cross-appeals from three Board decisions holding that the
 same claims, or a subset thereof, were shown to have been
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 INTEX RECREATION CORP. v. TEAM WORLDWIDE CORPORATION       3

 unpatentable as obvious. Intex Recreational Corp. v. Team
 Worldwide Corp., No. IPR2018-00870 (P.T.A.B. Sept. 12,
 2019), J.A. 5−139 (“870 Decision”); Intex Recreational Corp.
 v. Team Worldwide Corp., No. IPR2018-00871 (P.T.A.B.
 Sept. 12, 2019), J.A. 140−273 (“871 Decision”); Intex Recre-
 ational Corp. v. Team Worldwide Corp., No. IPR2018-
 00874 (P.T.A.B. Oct. 25, 2019), J.A. 407−545 (“874 Deci-
 sion”).
     For the following reasons, we affirm the Board’s holding
 in its 874 Decision, raised on cross-appeal by Team World-
 wide, that the challenged claims in the ’394 patent were
 shown to have been obvious in view of U.S. Patents
 7,039,972 (“Chaffee”) and 6,698,046 (“Wu”). Because of
 that affirmance, we do not address the Board’s other hold-
 ings raised on cross-appeal by Team Worldwide, or those
 appealed by Intex. The disposition in the 874 decision re-
 garding the ’394 claims invalidates all the claims at issue.
                        BACKGROUND
    This appeal pertains to five inter partes reviews (“IPRs”)
 in which Intex challenged claims 1−12 and 16−23 of the
 ’394 patent. The ’394 patent is directed to an inflatable
 product, like an air mattress, with a built-in pump. Repre-
 sentative claim 1 is presented below.
       1. An inflatable product including:
       an inflatable body;
       a fan and motor assembly for pumping air;
       a housing built into the inflatable body, the
       housing having an interior region; and
       an air conduit disposed at least in part in the
       housing, the air conduit being movable be-
       tween a first position and a second position
       while remaining disposed at least in part in
       the housing, the fan and motor inflating the
       inflatable body when the air conduit is in the
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 4    INTEX RECREATION CORP. v . TEAl\11 WORLDWIDE CORPORATION

           first pos1t10n, and deflating the inflatable
           body when the air con duit is in the second po-
           sition;
           wh erein air flows between the interior r egion
           of the hou sing and the inflatable body during
           inflation an d deflation.
 '394 pat ent , col. 8 11. 24-39 (emphasis added).
    As outlined in the table below, Int ex asserted various
 combination s of ten refer en ces across its five petition s,
 yielding sixteen different obviou sness gr ounds.

                             List of All
             Relevant                             Claims Found
     IPR                      Asserted
                to:                               Unpatentable
                             References
                             Wu , Ch affee,
     2018-     Cross-
                             Goldsmit h 1,         1-12, 16- 23
     00870     Appeal
                              Parient i 2

                          Walker 3, Chaffee,
     2018-     Cross-        Goldsmith,            1-3, 7-12,
     00871     Appeal      Parien ti, Basic       16-18, 22,23
                            Pneumatics 4

     2018-                  Miller 5, Scott 6,
               Appeal                                 None
     00872                  Wu, Pis ante 7

       1 U .S. Pat ent 2,493,067.
       2 U .S. Pat ent 6,018,960.
       3 U .S. Pat ent 4,890,344.
       4
      SMC P neumatics, Inc., B asic P neumatics (Part #
 SM CT-Pl-TX).
    5 U .S. Pat ent 5,529,377.
    6 U .S. Pat ent 4,938,528.
    7 FR Patent 2,583,825.
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 INTEX RECREATION CORP. v. TEAM WORLDWIDE CORPORATION      5

  2018-                 Parienti, Renz 8,
           Appeal                                None
  00873                       Wu

  2018-    Cross-        Chaffee, Wu,
                                             1−12, 16−23
  00874    Appeal        Scott, Pisante

     In its 872 and 873 Decisions, the Board found that Intex
 had not established the unpatentability of the challenged
 claims. Intex appealed those determinations.
    In the 870 and 874 Decisions, the Board found that In-
 tex had established the unpatentability of each of the chal-
 lenged claims. In its 871 Decision, the Board further held
 that Intex had established the unpatentability of a subset
 of those claims. Team Worldwide cross-appealed from
 those determinations.      We have jurisdiction under
 28 U.S.C. § 1295(a)(4)(A) and 35 U.S.C. § 141(c).
                        DISCUSSION
     We review the Board’s legal determinations de novo, In
 re Elsner, 381 F.3d 1125, 1127 (Fed. Cir. 2004), and the
 Board’s factual findings for substantial evidence, In re
 Gartside, 203 F.3d 1305, 1316 (Fed. Cir. 2000). A finding
 is supported by substantial evidence if a reasonable mind
 might accept the evidence as adequate to support the find-
 ing. Consol. Edison Co. v. NLRB, 305 U.S. 197, 229 (1938).
     Team Worldwide raises two main issues relevant to our
 resolution on appeal. It contends that the Board erred by:
 (1) determining that Chaffee and Wu combined to render
 obvious the claimed housing “built into” the inflatable body
 and (2) finding that the secondary considerations of nonob-
 viousness submitted by Team Worldwide were insufficient
 to overcome Intex’s prima facie case. We address each ar-
 gument in turn.

     8 EP Patent 0275896.
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 6   INTEX RECREATION CORP. v. TEAM WORLDWIDE CORPORATION

                               I.
     Team Worldwide contends that the Board erred in mul-
 tiple instances when determining that Chaffee and Wu
 would have rendered the challenged claims obvious.
     Team Worldwide focuses primarily on the “built into”
 limitation of the claims, which the Board construed to
 mean “integrated into and not detachable from.” Cross-Ap-
 pellant’s Br. at 50−58; 874 Decision at 11−12; J.A. 417−18.
 In particular, Team Worldwide asserts that the Board
 erred in “finding that the fluid controller of Chaffee is inte-
 grated into and non-detachable from the inflatable body
 and thus ‘built into’ as required by claims 1 and 16.” Cross-
 Appellant’s Br. at 50. But that misstates the claims as well
 as the Board’s inquiry. The claims require “a housing built
 into the inflatable body.” See ’394 patent, col. 8 ll. 24–39
 (emphasis added). They do not require that the entire
 pump, including the components disposed therein, be non-
 detachable. The Board thus did not hold that the compo-
 nents of Chaffee’s fluid controller pump, which includes not
 only the housing, but also, e.g., the motor and impeller, is
 taught to be non-detachable. It held only that Chaffee’s
 fluid controller housing, which consists of flange 82, flange
 wall 83, and housing 90, is built into the inflatable body.
 874 Decision at 23−29; J.A. 429−35; see also 874 Decision
 at 36 (“In light of the complete record, we find that one of
 ordinary skill in the art would have understood housing 90
 as a structure that ‘surrounds the inner workings of the
 pump’ and can ‘provide a connection between fluid control-
 ler 80 and bladder 20’ by (in one embodiment) flange 82
 extending from housing 90 as a different portion of the
 same structural component”); J.A. 442.
     There appears to be no dispute that Chaffee’s flange 82
 is built into the inflatable body. The dispute instead lies in
 whether Chaffee’s housing 90 is part of that flange struc-
 ture or is instead, a different, detachable component of the
 pump. As the Board explained, “we understand Chaffee to
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 INTEX RECREATION CORP. v. TEAM WORLDWIDE CORPORATION       7

 disclose at least two different embodiments: (1) an embodi-
 ment in which flange 82 and housing 90 (as well as wall 83)
 are different portions of the same structural component
 and (2) an embodiment in which flange 82 and housing 90
 are separate, but connected, components.” 874 Decision at
 27 (emphases in original); J.A. 433. It is that first embodi-
 ment that Intex relied upon in challenging the ’394 patent
 claims, and upon which the Board rested its obviousness
 determination.
     To support its obviousness determination, the Board
 identified language in Chaffee teaching that “[f]lange 82
 may, for example, extend from housing 90 or may be a sep-
 arate component connected to housing 90.” J.A. 6949, col.
 5 ll. 7−9. The Board held that the phrase “flange 82 may
 extend from housing 90” “does not, by itself, indicate
 whether the flange and housing are part of the same struc-
 tural component or whether they are separate, but con-
 nected.” 874 Decision at 27−28; J.A. 433−34. However, the
 Board found that “[i]n context,” a skilled artisan would
 have understood Chaffee to disclose a first embodiment in
 which the flange and housing are part of the same struc-
 ture, which is then built into the inflatable body. 847 De-
 cision at 27−28; J.A. 433−34. That holding was supported
 by substantial evidence. In particular, we agree with the
 Board that the disjunctive “or” in the description of how the
 flange “may extend from housing 90 or may be a separate
 component connected to housing 90,” provides support that
 Chaffee teaches an embodiment in which the flange and
 housing are part of the same structural component. The
 portions of Chaffee to which Team Worldwide points in op-
 position do not undermine that holding. Velander v. Gar-
 ner, 348 F.3d 1359, 1378−79 (Fed. Cir. 2003) (“If the
 evidence will support several reasonable but contradictory
 conclusions, we will not find the Board’s decision unsup-
 ported by substantial evidence simply because the Board
 chose one conclusion over another plausible alternative.”).
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 8   INTEX RECREATION CORP. v. TEAM WORLDWIDE CORPORATION

     Team Worldwide also asserts that “[a]s discussed in Pa-
 tent Owner’s Response, a [person of ordinary skill in the
 art] would not seek to combine Chaffee with Wu for multi-
 ple reasons including that of different pump types, differ-
 ent pump usages, lack of spatial efficiency, lack of
 increased energy efficiency, lack of decreased costs, lack of
 decreased weight, and that any such combination is not a
 simple substitution.” Cross-Appellant’s Br. at 83. That
 conclusory assertion attempting to incorporate by refer-
 ence a portion of its Patent Owner Response is a violation
 of Federal Rule of Appellate Procedure 28(a)(6), and other-
 wise substantively insufficient to challenge the Board’s
 holding. See Monsanto Co. v. Scruggs, 459 F.3d 1328, 1335,
 1341 (Fed. Cir. 2006) (citing Graphic Controls Corp. v.
 Utah Med. Prods., Inc. 149 F.3d 1382, 1385 (Fed. Cir.
 1998)).
     Team Worldwide further contends that the “Board
 erred in concluding that a [person of ordinary skill in the
 art] would have been motivated to modify Chaffee based on
 Wu for the same reasons as the discussion above for Wu
 and Chaffee.” Cross-Appellant’s Br. at 81. But the adopted
 rationales to combine those two references were different,
 depending on whether Chaffee or Wu was relied upon as
 the primary reference. In the 870 IPR, the Board held that
 a skilled artisan would have been motivated to combine Wu
 with Chaffee for durability and spatial efficiency reasons.
 870 Decision at 51−70; J.A. 55−74. But in the 874 IPR, the
 obviousness challenge involved modifying Chaffee in view
 of Wu’s uni-directional pump, and the Board found a moti-
 vation to combine based on Wu’s pump being more energy
 efficient than the pump taught by Chaffee. 874 Decision at
 47−62; J.A. 453−68. Other than mentioning energy effi-
 ciency in its conclusory assertion tethered to its Patent
 Owner Response, Team Worldwide does not address that
 holding. Team Worldwide’s arguments regarding durabil-
 ity and spatial efficiency, as well as its assertions that the
 mattress in Wu required more air flow than the mattress
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 INTEX RECREATION CORP. v. TEAM WORLDWIDE CORPORATION      9

 in Chaffee, are insufficient to undermine the Board’s moti-
 vation to combine holding in the 874 Decision based on en-
 ergy efficiency.
     Team Worldwide provides no other substantive argu-
 ment challenging Intex’s prima facie case that Chaffee and
 Wu would have rendered the challenged claims obvious. 9
 We therefore affirm the Board’s determination that Intex
 established by a preponderance of the evidence a prima fa-
 cie showing that the challenged claims would have been ob-
 vious in view of Chaffee and Wu.
                             II.
    Team Worldwide also asserts that the Board erred in
 finding that the secondary considerations of nonobvious-
 ness submitted by Team Worldwide were insufficient to
 overcome Intex’s prima facie case. See 874 Decision at
 62−88; J.A. 468−94.
     In particular, Team Worldwide asserts that it was enti-
 tled to a presumption of nexus regarding (1) competitor
 products for which infringement was stipulated; (2) its own
 products; and (3) airbeds advertised as “built-in pump” air-
 beds. The Board agreed only with regard to the first cate-
 gory, holding that Team Worldwide had failed to establish
 that its products practiced a challenged claim and that it

     9 A table in Cross-Appellant’s brief lists as “Key Limi-

 tations Board Found Purportedly Disclosed” includes that
 Chaffee teaches the “inflatable body” limitation and that
 Chaffee, modified by Wu, teaches the “‘air conduit’ movea-
 ble for inflation/deflation” limitation. See Cross-Appel-
 lant’s Br. at 29. However, Team Worldwide provides no
 additional argument that those holdings were unsupported
 by substantial evidence, and thus we do not address those
 findings here.
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  10 INTEX RECREATION CORP. v. TEAM WORLDWIDE CORPORATION

  had advanced only conclusory arguments for the third cat-
  egory. See 874 Decision at 64−69; J.A. 470−75.
      A patent owner is entitled to a presumption of nexus
  when it shows that the asserted objective evidence is tied
  to a specific product that “embodies the claimed features,
  and is coextensive with them.” Brown & Williamson To-
  bacco Corp. v. Philip Morris, Inc., 229 F.3d 1120, 1130
  (Fed. Cir. 2000). We agree with the Board that Team
  Worldwide failed to provide sufficient support that its prod-
  ucts embodied any of the challenged claims and that its ar-
  guments regarding advertised air beds are conclusory at
  best. See 874 Decision at 64−69; J.A. 470−75. Moreover,
  Team Worldwide never provided an analysis to establish
  coextensiveness, and therefore could not have established
  a presumption of nexus for its products. Although Team
  Worldwide also did not provide an analysis to establish co-
  extensiveness for the first category of products stipulated
  to infringe the ’394 patent, Intex did not appeal the Board’s
  holding that a presumption of nexus existed for those prod-
  ucts.
      A patent owner is further “afforded an opportunity to
  prove nexus by showing that the evidence of secondary con-
  siderations is the ‘direct result of the unique characteristics
  of the claimed invention.’” Fox Factory, Inc. v. SRAM, LLC,
  944 F.3d 1366, 1373–74 (Fed. Cir. 2019) (quoting In re
  Huang, 100 F.3d 135, 140 (Fed. Cir. 1996)). But Team
  Worldwide failed to establish that the proffered evidence of
  secondary considerations was the direct result of any
  unique characteristics of the claims. Instead, as the Board
  found, the record establishes that non-patented features,
  such as durability, comfort features, and firmness, drove
  sales, rather than the built-in pump. See 874 Decision at
  71−76; J.A. 477−482. We therefore find that the Board’s
  conclusion that Team Worldwide did not establish a nexus
  between its products and the claims was supported by sub-
  stantial evidence.
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  INTEX RECREATION CORP. v. TEAM WORLDWIDE CORPORATION 11

      Team Worldwide finally asserts that the Board erred in
  evaluating the secondary considerations of nonobviousness
  for the competitor products stipulated to infringe the ’394
  patent. Team Worldwide essentially asks this court to re-
  weigh the evidence. We see no error in the Board’s analysis
  of the individual secondary considerations of nonobvious-
  ness and determine that they are each supported by sub-
  stantial evidence.     Mere contradictory evidence and
  general disagreement are insufficient to overturn a finding
  of fact. Velander, 348 F.3d at 1378−79. We therefore af-
  firm the Board’s holdings that Team Worldwide failed to
  establish that secondary considerations overcome the
  prima facie case of obviousness in view of Chaffee and Wu.
     At oral argument Intex confirmed that an affirmance of
  a determination of unpatentability in either the 870 or the
  874 Decision would render all issues on appeal moot. Oral
  Argument,       https://oralarguments.cafc.uscourts.gov/de-
  fault.aspx?fl=20-1141_10052023.mp3, at 8:42−10:10. As
  we have affirmed the Board’s holding in the 874 Decision
  that the challenged claims would have been obvious in view
  of Chaffee and Wu, we therefore need not reach the other
  issues raised on appeal or cross-appeal.
                         CONCLUSION
     We have considered Team Worldwide’s remaining ar-
  guments and do not find them persuasive. For the forego-
  ing reasons, we affirm the Board’s determination in
  IPR2018-00874 that the challenged claims would have
  been obvious in view of Chaffee and Wu and dismiss the
  appeals of the 872 and 873 Decisions, as well as the cross-
  appeals of the 870 and 871 Decisions, as moot.
                         AFFIRMED
                            COSTS
 Costs to Intex.