Opposite the normal role of the Court of Appeals for the Federal Circuit (CAFC), in Vanguard Identification Sys., Inc. v. Kappos the court affirmed a USPTO Board of Patent Appeals and Inferences (BPAI) decision reversing an obviousness determination in Vanguard Identification Sys. Inc. v. Bank of America Corp.

The case involves a Bank of America patent on a data card with a circular aperture cut-out in the corner to connect to a keychain or something similar.The BPAI, holding that there was no obvious adaptation of any primary references, used In re Rosen, which stated “there must be a reference, a something in existence, the design characteristics of which are basically the same as the claimed design in order to support a holding of obviousness.”  The BPAI stated that the previously patented data cards with no apertures were “inadequate as a primary reference because [they do] not create basically the same visual impression as the claimed design.”

This holding requiring “basically the same visual impression” from a previous reference in order to argue obviousness creates a threshold making it easier to get a design patent, but harder to prove infringement.  This is seemingly much stricter than the test presented in KSR Int’l Co. v. Teleflex Inc., where the court stated “[c]ommon sense teaches, however, that familiar items may have obvious uses beyond their primary purposes, and in many cases a person of ordinary skill will be able to fit the teachings of multiple patents together like pieces of a puzzle.”  Using the KSR test, the existence of numerous styles of cards, including ID cards and grocery store cards, that have holes punched in them would seem to imply that there has been an obvious jump from a credit card without an aperture to a credit card with an aperture.

Considering the policy objective of patents, and specifically design patents, where on one hand it is to promote growth and “give encouragement to the decorative arts,” Gorham Manufacturing Co. v. White, and on the other hand as an economic “reward, an inducement, to bring forth new knowledge,” Graham v. John Deer Co., this recent CAFC holding seems to run contrary to both objectives.  As the Supreme Court stated in 1950 in Graver Tank, in determining enforcement one must look beyond every detail as to not turn the “patent grant into a hollow and useless thing.”  The CAFC’s holding in this case, requiring that for an obviousness complaint the primary reference must have “basically the same visual impression,” inhibits growth of the sciences and the arts by reducing protection to those who create, which in fact is turning a design patent into a “hollow and useless thing.”

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