TQ Delta owns patents for technology that reduces the power consumed by certain systems that transmit electronic signals, including DSL systems. The technology reduces the probability of data loss that must otherwise be addressed with costly equipment.

Several providers of communications equipment or services, including Cisco Systems, Verizon, Time Warner Cable, and Dish Network (collectively “Cisco”), challenged the patents. They contended that TQ Delta’s technology was not original and thus could not be patented. Rather, they contended that knowledge publicly available prior to the patents made the TQ Delta technology obvious to anyone with ordinary skill in the field of signal transmission. To defeat the patent, Cisco also needed to prove that a person with knowledge would have been motivated to create the same technology.

The challenge was filed with the United States Patent and Trademark Office (PTO). Relying on expert testimony offered by Cisco, the PTO agreed that the patents were not valid. The Court of Appeals for the Federal Circuit held that the PTO erred by relying on expert testimony that the appellate court regarded as conclusory.

Cisco’s Expert Testimony

Administrative agency decisions must be affirmed if they are supported by substantial evidence. A decision is supported by substantial evidence if a reasonable factfinder could reach the same conclusion based on the evidence before the agency.

Expert opinions can provide substantial evidence, but only if the opinions are not conclusory. Rather, the expert’s opinion must be supported by reasoning that takes account of relevant facts. An unexplained opinion does not constitute substantial evidence to support an agency’s conclusion.

Cisco relied on the expert opinion of Dr. Jose Tellado. Dr. Tellado identified technology that was similar to TQ Delta’s and opined that a person with ordinary skill in the same field would have recognized that using that technology to solve the transmission problem in the way patented by TQ Delta “would have been a relatively simple and obvious solution.”

The appellate court concluded that Dr. Tellado provided an insufficient link between existing technology and the adaptation of that technology patented by TQ Delta. Dr. Tellado did not explain why the adaptation of the technology would have been “relatively simple.” Nor did he explain his “unsupported and conclusory” assertion that a person with ordinary skill in the field would have been motivated to make the patented adaptation at the time the patent was obtained.

The fact that another inventor could have created the same invention does not prove that the other inventor would have been done so in the same way as the patented invention. Dr. Tellado’s conclusory declaration therefore failed to provide substantial evidence to support the PTO’s decision that the patented technology was obvious. For that reason, the appellate court reversed the decision.

Lessons Learned

What may seem like a logical conclusion to an expert might be regarded as a conclusory opinion to an appellate court. Dr. Tellado needed to explain why an ordinarily skilled inventor would recognize a solution to a problem offered by existing technology and why that inventor would implement the solution in the same way it was implemented by the inventor of the patented technology. That is a daunting task.

Dr. Tellado and Cisco’s lawyers undoubtedly viewed his opinion as more than conclusory. The appellate court’s decision should encourage experts in patent litigation to justify the conclusion that an ordinary inventor would see patented technology as an obvious solution to a problem. Experts cannot work with the benefit of hindsight — the fact that one inventor devised a solution to a problem does not establish that other inventors at the time would have regarded the solution as obvious — but must offer a detailed explanation of the way in which existing technology made the adaptation of that technology in the patented invention an obvious solution to a problem.

An expert who says too much in a report might create fodder for cross-examination, but an expert who says too little risks having an opinion labeled as “conclusory.” The TQ Delta decision sends the message that the more explanation an expert provides, the less likely it is that the expert’s opinion will be dismissed as unhelpful.