Despite Therasense: Federal Circuit Finds Aventis Patent Unenforceable

by Dennis Crouch

This is an important case showing that inequitable conduct based upon failure to cite prior art will continue to be viable.

Aventis Pharma v. Hospira (Fed. Cir. 2012)

Aventis holds two patents that cover its branded chemotherapy drug Taxotere. According to the patent, the active drug is mixed with other ingredients to form a perfusion that can be injected intravenously without causing anaphylactic or alcohol intoxication symptoms.

In litigation to prevent Hospira from bringing a generic form to market, the district court ruled the patents unenforceable for inequitable conduct during prosecution of the patents. On appeal, the Federal Circuit has affirmed that holding. This case marks the first time that the appellate court has upheld an inequitable conduct finding since raising the standard of proof in the 2011 Therasense v. BD en banc decision.

Inequitable conduct occurs when a patent applicant intentionally and materially misleads the patent office. Both intent and materiality must be proven. In Therasense, the court additionally held that materiality is normally only satisfied if the misconduct was a “but-for” cause of the given patent being issued. (Caveat for egregious misconduct).

This case involves the most typical inequitable conduct allegation: failing to notify the USPTO of a known reference that impacts patentability.

Lets walk through the steps of materiality and intent:

Materiality: In addition to inequitable conduct, the court also held a few of the patent claims invalid as obvious – relying upon the withheld reference. According to the court, this fact alone proves materiality – since the reference rendered the claim invalid. Two procedural issues add to this conclusion: (1) Claims are (according to the law) more narrowly construed at trial than at the USPTO and therefore references that are material at trial would have definitely been material at the USPTO. (2) Invalidation requires clear and convincing evidence but proof of materiality for inequitable conduct only requires a preponderance of the evidence. As such, information that works to prove the higher standard would certainly work to prove the lower standard.

Intent: To win, the defendant must show that the defendant had specific intent deceive. This can be proven by inference, but only if that conclusion is the “single most reasonable inference able to be drawn from the evidence.” Here, the inventor testified that he saw the references as explaining failed experiments and therefore need not be disclosed to the PTO. However, the judge found that the inventor lacked credibility and that some evidence suggested the inventor had learned valuable information from the reference.

On appeal, the court confirmed that these elements were met and that the patents were therefore obtained through inequitable conduct.

30 thoughts on “Despite Therasense: Federal Circuit Finds Aventis Patent Unenforceable

  1. They may or may not have had him review the docs in advance, but there’s not much you can do if he’s presented with the doc for the first time in the depo, asked if he recognizes it, and reviews it then and has to answer questions about it.

  2. I would think the better response is “I don’t remember. That was 10 years ago.” Difficult to find intent in that.

    I guess that only holds true when the deponent really doesn’t remember and there is a large gap in the time from grant to enforcement though (which is often the case). I think that’s better than trying to review the patent and justify a reason in the present. The deponent’s attorneys shouldn’t even allow him to review the reference before the deposition.

  3. OT, but worth nothing

    Like something from the champion of Infringer’s Rights is worth anything

  4. But at both courts, Sanofi argued that the references were merely cumulative to the references already of record.

    Perhaps someone can provide us with an excerpt of the briefing on this issue. I’m guessing Sanofi’s arguments were borderline sanction-worthy.

  5. Both courts (i.e., the Federal Circuit and the District Court) dodged the “materiality” prong.

    Both courts concluded that the references were but-for material because the patents were invalidated over them.

    But at both courts, Sanofi argued that the references were merely cumulative to the references already of record. Neither court addressed this issue at all. The district court acknowledged the argument, but responded with a simple statement that “These references are not cumulative of other evidence…”, without explaining the basis for this conclusion.

    The Federal Circuit acknowledged the argument at only one single instance (page 14 of the slip opinion) using the word “duplicative” instead of “cumulative” (“Sanofi contends that these references were not material to patentability because they were duplicative of references that were before the PTO”). But the Federal Circuit was even worse than the district court, in that the Federal Circuit completely ignored the argument without ever mentioning it again.

    Perhaps both courts reasoned that it was a logical impossibility for the references to be cumulative, for the reason that the patents were valid over the art of record but invalid over the withheld references. That’s not bad reasoning, and might even be correct, but we’ll never know since neither court even addresses it.

  6. MD Out of curiosity, how often is this how IC works?

    Depends on how involved the Project Leader is in prosecution. In my experience, scientists do occasionally become heavily involved or invested in prosecution. Sometimes there are ego issues relating to competitors and the competitors’ patents which get personal. But these situations tend to result in IC more similar to that in Therasense, i.e., playing fast and loose with facts in declarations, over-reliance on weasel words and “legalese”, etc.

    I am intrigued by … the deliberate decision within Sanofi NOT to disclose the two invalidating references to the USPTO

    I have no idea why you find this intriguing, MD. Many businesses routinely choose to ignore certain laws, for business reasons. Such decisions are often quite profitable for these businesses.

  7. (i) “The CAFC Decision has it that Fabre it was, who personally made the fateful decision not to disclose to the USPTO. How close to real life is that?”

    (ii) “Suppose in-house patent counsel at Sanofi helped the PL to decide that the PL is not going to tell in-house patent counsel officially about the references. Then, years later, the PL is found to be the only naughty boy, the only one who was inequitable. …Out of curiosity, how often is this how IC works?”

    (i): My experiences of a number of large corporations is that we (legal) tell the inventors to send us notice of all relevant documents. Several times. It is a required element of standard invention disclosure forms, then they are asked again at app drafting time, asked again when the U.S. utility app is filed, and asked again a few months later when the docketing system triggers the IDS deadline. Once legal has notice of the references, the onus is on legal to inform the USPTO. Still, for all that, scientists in my experience never make a deliberate decision to withhold a reference. They may, however, be busy and fail to spend much (or any) time pondering whether they know of relevant references.

    I would very much like to read the lower court trial transcripts; I suspect this Fabre was flummoxed during deposition when the material reference was shown him, and then tried carefully to provide his “reasonable” answer for not citing it, which included his opinion of the reference (“bunch of failed experiments”) at that time. But I’d be willing to bet you a couple of pounds sterling that overlaid atop that “reasonable reason” was yet another that he felt ashamed to admit – “Hey, I was busy and just didn’t think hard enough, so although I had seen it before, I just didn’t recall this patent back then”.

    (ii): Like “never”, is my informed guess. Why wouldn’t the PL squeal like a little piglet once accused of wrongdoing? And what in-house counsel would risk his/her license in such shenanigans?

  8. Try, your error all along is your assumption

    Don’t blame me for the awful way you communicate.

    Try again.

  9. Try, your error all along is your assumption that I was stating the law as it currently exists, when, instead, I was criticizing it.
     
    But I am glad we both agree that trying to determine "broadest reasonable interpretation" of a claim term is wholly speculative.  We all know the way it operates in the patent office is that the examiner reads the claims on prior art and then justifies his implicit construction under the rubric of broadest reasonable interpretation.  How one establishes broadest reasonable interpretation in court completely out of context of a prior art rejection is something new entirely.  I don't even know if any new procedures in district courts that are intended to deal with a separate claim construction of disputed claim terms to determine both their proper construction and their broadest reasonable interpretation. 

  10. I argue think and hope that

    But quite clearly, that is not the law.

    There is nothing wrong with wanting changes to the law.

    There is everything wrong with pretending the law is what your fantasy would have it be.

    Try again.

  11. OT, but worth nothing

    LOL, I was waiting for someone to mention that “study” here.

    Here are six of the top seven “IP-intensive” industries by total jobs, accounting for 1/4 of total employment:
    - residential building construction
    - grocery stores
    - clothing stores
    - depository credit intermediation
    - insurance carriers
    - management and technical consulting

    Pretty sure those industries would be doing just as well if they were less “IP-intensive”. (All of the top employers are trademark-intensive, by the way. None are patent-intensive.)

    Sure, individual large companies might not be doing as well without a nationwide brand, but people would still need to buy the same amount of houses and groceries and clothing and insurance.

  12. Try, have you even read Therasense? Did you even read my OP?

    Since we agree that trying to determine the BRI of a claim term is speculative, then we agree that the rule of Therasense is speculative in the absence of a prior holding of invalidity. The Therasense bare majority designed the rule to operate without a prior holding of invalidity. I think Thereasense bare majority was wrong in not requiring invalidity. However, the majority position was a heck of a lot better than the dissent. The majority may have had to compromise a bit to get the votes necessary.

    What is not speculative, however, is when a claim has been held invalid over specific art. That establishes materiality. I argue think and hope that that is what actually establishes materiality in all future cases.

  13. yet another regulatory action to prevent an economic recovery?

    Preventing economic recovery on a patent obtained by inequitable conduct? Where do I sign?

  14. Do you just enjoy trolling, or are you really that excited about taking yet another regulatory action to prevent an economic recovery? I’m just asking for reference.

  15. Will anybody help this innocent from Europe?

    I am intrigued by the witness evidence of scientist, named inventor and Sanofi project leader (PL), by the absence of witness evidence from anywhere else inside Sanofi, and by the deliberate decision within Sanofi NOT to disclose the two invalidating references to the USPTO.

    The CAFC Decision has it that Fabre it was, who personally made the fateful decision not to disclose to the USPTO. How close to real life is that?

    Suppose in-house patent counsel at Sanofi helped the PL to decide that the PL is not going to tell in-house patent counsel officially about the references. Then, years later, the PL is found to be the only naughty boy, the only one who was inequitable.

    Justice yes, fairness no. Or is there more than one kind of fairness. Out of curiosity, how often is this how IC works?

  16. You state “My stated position?

    What are you talking about? Pay attention to this discussion. Don’t be rude. Stop using your dxmm email reply system and join the thread like a normal person.

    No one ever said that trying to determine inequitable conduct using broadest reasonable interpretation was not speculative.

    It has always been speculative.

    This is neccesitated by the fact that the applicant must step into the shoes of the examiner and guess what an examiner might find material.

    It always has been up to the examiner to determine materiality, because it is the examiner that examines. The whole point of providing material to the examiner is so that the examiner can decide. You don’t seem to understand this very basic principle.

    Try again.

  17. My stated position?

    My stated position is that trying to determine inequitable conduct using broadest reasonable interpretation is sheer speculation.

    Sent from iPhone

  18. NO. You missed the fact that invalidity is not what you are proclaiming it is in relation to IC.

    Quite clearly, IC does not require per se invalidity as to the necessary level of proof of materiality.

    Invalidity is icing on the cake. It is not the cake.

    Try again.

  19. Q. Why A. Two utterly different reasons. So:

    Germany: The thinking was that for a full 20 year exclusive right, society should require a higher level of inventive activity than for the grant of a maximum term of 10 years utility patent (a so-called Gebrauchsmuster).

    UK: The thinking was that opposition proceedings at the PTO, without the fact-finding processes available to the courts, should revoke patents for obviousness only when the invalidity case was “clear”.

    However logical the thinking, it did not hold.

  20. How interesting for a reader from Europe. UK used to have two different obviousness standards (obvious and clearly obvious) but doesn’t any more. Germany used to have two obviousness standards (inventive step and inventive activity) but doesn’t any more. in the USA, in future, how much difference is there going to be for the deciders, I wonder, between preponderantly obvious and convincingly obvious.

  21. Invalid?

    2) Invalidation requires clear and convincing evidence but proof of materiality for inequitable conduct only requires a preponderance of the evidence

    Try again.

  22. Many of us had argued that the but for materiality test must include a finding that a claim was invalid over the non disclosed art, otherwise the court would simply be engaging in a lot of speculation about whether the result would have gone differently using a lower standard of proof and BRI. Hopefully, this case is a harbinger that IC will only be found in practice if a claim is first held invalid over the non disclosed art.

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