CAFC: Pre-AIA 102(g)(2) Captures Reduction in US on Invention Conceived in Russia


On February 12, 2014, the Federal Circuit issued its decision in Solvay S.A. v. Honeywell International. In this case, Solvay S.A. appealed to the United States Court of Appeals for the Federal Circuit from a judgment of the United States District Court for the District of Delaware in favor of defendant Honeywell International. The district court held that asserted claim 1 of Solvay’s U.S. Patent No. 6,730,817 was invalid under pre-AIA 35 U.S.C. § 102(g)(2). The question at the heart of this appeal, as dictated by the specific factual scenario, was whether an invention conceived by a foreign inventor and reduced to practice in the United States qualifies as prior art under § 102(g)(2). This was the operative question because engineers working at the Russian Scientific Center for Applied Chemistry (“RSCAC”) first conceived the invention, which was reduced to practice in this country by Honeywell personnel pursuant to the RSCAC’s instructions, and they did not abandon, suppress, or conceal it.

At trial, Honeywell argued that the invention was conceived by Russian inventors outside the United States and reduced to practice in the United States by Honeywell personnel following the Russian inventors’ instructions before the ’817 patent’s priority date. As a result, Honeywell argued, the invention qualifies as §102(g)(2) prior art. A jury ultimately determined that, as required by § 102(g)(2), the Russian Scientific Center for Applied Chemistry did disclose the invention of claim 1 in the 1994 Russian patent application, which means that they did not abandon, suppress, or conceal the invention. Based on the jury verdict, the district court entered judgment for Honeywell, finding asserted claim 1 invalid under § 102(g)(2).

On appeal, Solvay made two arguments: (1) the doctrine of inurement, defining when the activities of others inure to the benefit of the inventor, controls the question of whether Honeywell’s work can be attributed to the RSCAC engineers; and (2) the undisputed facts do not establish inurement because the RSCAC engineers did not expressly ask the Honeywell researchers to perform the inventive process.

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The Federal Circuit, per Judge Dyk (joined by Judge Rader), did not specifically state that the inurement doctrine applied, but rather explained that it did not mean what Solvay argued it meant. Judge Dyk explained: “Assuming that the inurement doctrine governs, inurement does not require that the inventor expressly request or direct the non-inventor to perform reductive work.” Judge Dyk went through several Federal Circuit cases on the issue of inurement and ultimately concluded:

Thus, our case law does not support Solvay’s contention that an inventor must make an express directive or request to benefit from a third party’s reduction to practice. Rather, inurement exists if the inventor authorizes another to reduce his invention to practice. Here, the research agreement between the RSCAC and Honeywell confirms that the RSCAC authorized Honeywell to practice its invention in the United States and contemplated that Honeywell would do so.

The Federal Circuit also explained that, while a reduction to practice made outside the United States is beyond the scope of pre-AIA § 102(g)(2) prior art, a reduction to practice made in the U.S. on an invention conceived outside the U.S. was not beyond the scope of pre-AIA § 102(g)(2). Quoting In re DeBaun, 687 F.2d 459, 463 (CCPA 1982), Judge Dyk explained: “[T]here is no requirement that the inventor be the one to reduce the invention to practice so long as the reduction to practice was done on his behalf in the United States.”

Judge Newman dissented, saying:

The court today creates a new class of secret prior art, holding that a privately performed experiment, without publication or public knowledge or use or sale or inclusion in a United States patent application, is invalidating “prior art.” Heretofore the role of secret prior art has been carefully circumscribed. The new general rule here adopted contravenes the policy and the letter of patent law, wherein inventors are charged only with knowledge of what is known or knowable as defined by statute, subject to special limited circumstances.

The panel majority holds that private secret activity – in this case Honeywell’s evaluation of Russian technology that had been invented in Russia and placed in an unpublished Russian patent application – is “prior art” against all others, thereby invalidating the Solvay patent.

Judge Newman went on:

The Honeywell test of the Russian process was a private experiment. No United States patent application was filed on the Russian process, not by Honeywell and not by the Russian inventors. A private experiment is not prior art, when it is not published, nor used, sold or otherwise made known, nor included in a United States patent application…. My colleagues simply rule that due to “inurement” the secret Honeywell test converts the still secret Russian technology into “prior art.”

I have long been troubled by the fact that something that is secret can be considered prior art. That strikes me as fundamentally unfair, so I tend to agree with Judge Newman. Of course, over time, these pre-AIA cases will go away. If the Courts ultimately interpret AIA 102 the way the USPTO has, secret prior art will no longer be considered prior art that can defeat patentability. I have my doubts that courts will do that, but it would be a good thing in my opinion. The legislative history associated with the AIA is rather clear, but the statute is silent on the issue of secret prior art. So we may continue to see issues of secret prior art indefinitely.

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