Magseis Ff LLC v. Seabed Geosolutions (us) Inc.

N OTE: This disposition is nonprecedential.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
______________________
J EFFREY COSTAKOS , Foley & Lardner LLP, Milwaukee,
WI, for appellant. Also represented by RUBEN J OSE
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MAGSEIS FF LLC v. SEABED GEOSOLUTIONS ( US) INC. 2
RODRIGUES , Boston, MA.
J OHN R. L ANE, Fish & Richardson P.C., Houston, TX,
for appellee. Also represented by D ANIELLE J. HEALEY ,
BRIAN G REGORY STRAND.
ROBERT MCB RIDE, Office of the Solicitor, United States
Patent and Trademark Office, Alexandria, VA, for interve-
nor. Also represented by T HOMAS W. K RAUSE, WILLIAM
L AMARCA , F ARHEENA YASMEEN RASHEED.
______________________
Before M OORE, Chief Judge, L INN 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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MAGSEIS FF LLC v. SEABED GEOSOLUTIONS ( US) INC. 4
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’ predecessor2 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).
D ISCUSSION
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 Mattaboni3 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
G EOPHYSICAL RESEARCHES 3 (1977) 87–102.
4 Sutton, George H., Optimum Design of Ocean Bot-
tom Seismometers, MARINE G EOPHYSICAL 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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MAGSEIS FF LLC v. SEABED GEOSOLUTIONS ( US) INC. 6
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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MAGSEIS FF LLC v. SEABED GEOSOLUTIONS ( US) INC. 8
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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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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MAGSEIS FF LLC v. SEABED GEOSOLUTIONS ( US) INC. 10
“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
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