Federal Circuit Vacates PTAB Decision, Finding Board Erred in Requiring Motivation to Combine

The U.S. Court of Appeals for the Federal Circuit (CAFC) on Friday vacated and remanded a final written decision from the Patent Trial and Appeal Board (PTAB) in an inter partes review (IPR) proceeding. The court concluded that the Board erred by requiring petitioner Guardant Health, Inc. to show a motivation to combine steps that were already disclosed in sequence in a single prior art reference.

Guardant Health challenged U.S. Patent No. 10,760,127, owned by the University of Washington (UW). The patent is directed to a method for reducing the error rate in massively parallel DNA sequencing using Duplex Consensus Sequencing (DCS). The patent’s specification explains that, while massively parallel DNA sequencing has been used for clinical applications such as prenatal screening and cancer detection, it has limitations. According to the patent, errors that occur during sample preparation and sequencing create “a practical limit of detection” where approximately 1% of DNA bases are incorrectly identified. This “background level of artifactual heterogeneity,” the patent states, “establishes a limit below which the presence of true rare variants is obscured.” The patent discloses the use of DCS to lower this error rate by using the redundant information in double-stranded DNA.

In the IPR proceeding, Guardant argued that claims 1-30 of the patent were unpatentable as obvious over two prior art references, a patent application publication known as Travers ‘075 and a 2010 journal article by the same author, Travers 2010. Guardant asserted that these references, collectively the Travers Publications, disclosed the key limitations of the claims, namely the steps of “amplifying” and “sequencing.” Guardant specifically pointed to a single embodiment in paragraph 122 of Travers ‘075 which taught a process of “rolling circle replication” (RCR) followed by Single Molecule Real Time (SMRT) sequencing. Guardant argued this embodiment taught amplification followed by sequencing. In its response, UW argued that a person of ordinary skill in the art would not have been motivated to modify the SMRT sequencing process with the RCR amplification step from Travers ‘075 and that there would have been no reasonable expectation of success.

The Board, in its final written decision, found that Guardant had not demonstrated by a preponderance of the evidence that a skilled artisan would have had a reason to combine the steps or a reasonable expectation of success. The Board found that a skilled artisan would not have modified the Travers Publications to perform RCR amplification followed by SMRT sequencing because it would have rendered the SMRT sequencing on zero-mode waveguides (ZMWs), as disclosed in the prior art, unworkable. The Board did not address the separate issue of whether the disclosure in Travers ‘075 was enabling.

On appeal, the Federal Circuit determined that the Board had applied an incorrect legal standard. The court explained that when disputed claim elements are disclosed together in a single embodiment within a single prior art reference, there is no requirement to provide a separate motivation to combine them. The court cited its 2020 decision in General Electric Co. v. Raytheon Technologies Corp., where it held that it is an error to “require a motivation to combine each element of the claim, even those present together in a reference.” The court stated that such an approach “unduly dissects prior art references into collections of individual elements, requiring a party showing obviousness to re-do the work already done in the prior art reference.”

Applying that precedent, the court held that the Board erred in requiring Guardant to show that a skilled artisan would have been motivated to combine the RCR amplification and SMRT sequencing steps. The court noted it was undisputed that paragraph 122 of Travers ‘075 expressly disclosed performing amplification followed by sequencing in a single embodiment. Since the reference itself already disclosed the steps in the required sequence, no additional motivation to combine was necessary. The court also found UW’s argument that Guardant had not properly presented this argument to the Board to be unpersuasive, stating that Guardant’s petition had cited the relevant embodiment in Travers ‘075 as teaching the sequential steps.

The Federal Circuit also held that the Board erred in requiring Guardant to show a reasonable expectation of success. The court stated that the reasonable expectation of success requirement typically refers to the likelihood of success in combining different references. Since Guardant’s argument relied on a single embodiment from a single reference, the court found no basis for requiring a showing of a reasonable expectation of success to combine the steps. The court distinguished UW’s reliance on In re Stepan Co., explaining that the legal standard in Stepan applies to combinations of multiple references or multiple embodiments, which was not the case here.

Furthermore, the court did not address UW’s alternative argument that the disclosure in Travers ‘075 was not enabling. UW had argued that because the disclosure was not enabling, it could not be relied upon for obviousness. The court noted that the Board had not addressed this issue in its decision and, while citing the rule against addressing issues not passed upon below, remanded the case to the Board to consider the enablement question in the first instance. For these reasons, the Federal Circuit vacated the PTAB’s decision and remanded the case for further proceedings consistent with its opinion