Court: Metallizing Engineering Overruled by Statute

by Dennis Crouch

Helsinn v. Dr. Reddy’s and Teva, Civ. No. 11-cv-03962 (D.N.J. March 3, 2016) [Helsinn Opinion]

The district court decision in this case is focused on the medical marijuana substitute Aloxi (Palonosetron) by Helsinn and its U.S. Patent Nos. 7,947,725, 7,960,424, 8,598,219.  Of these, the district court found that the ‘219 patent is an AIA patent.  As is common in the drug industry, Helsinn carried out a number of clinical trials (working with third parties) prior to filing that included selling the du. And, a primary question for the court was whether the invention was “on sale” prior to the invention and/or filing date.

Under pre-AIA rule, the “on sale” bar included prior secret sales and offers-for-sale. See Metallizing Eng’g Co. v. Kenyon Bearing & Auto Parts Co., 153 F.2d 516 (2d Cir. 1946).  Although the AIA includes the identical “on sale” language, the rewritten Section 102 also includes the additional catchall “otherwise available to the public.”

As the fist decision interpreting the new statute, the court (Judge Cooper) here held that the “otherwise” language modifies and limits the “on sale” provision — indicating that sales and offers for sale only count as prior art if they are also “available to the public.”

§102(a)(1) requires a public sale or offer for sale of the claimed invention. The new requirement that the on-sale bar apply to public sales comports with the plain language meaning of the amended section, the USPTO’s interpretation of the amendment, the AIA Committee Report, and Congress’s overarching goal to modernize and streamline the United States patent system.

The court’s interpretation here is parallel to that of the USPTO in its examination guidelines. Although not the law, the Patent Office’s statements appear to have influenced the court here. It also falls in-line with what Paul Morgan suggested in his 2011 article. Paul Morgan, The Ambiguity in Section 102(a)(1) of the Leahy-Smith America Invents Act, 2011 Patently-O Patent Law Review 29.  Download Morgan.2011.AIAAmbiguities

Here, because the patentee’s sales were kept secret (“subject to and performed under confidentiality restrictions”), they could not be considered sales under the new statute.

Teva filed its Federal Circuit appeal in the case on March 7, but the brief is not yet public. I expect that the Federal Circuit opinion will be interesting — especially if the court reaches this issue.  (The court might not reach the issue depending upon whether the actions are excluded under the upcoming Medicines Co. v. Hospira en banc decision.  In addition, the court did not explain why the patent in question–a continuation from a pre-AIA case–counts as an AIA patent.)

My basic take on the statutory construction issue is that it could legitimately go either way.  My hope is that the issue is resolved to remove the uncertainty and the likelihood that a significant number of patents are wrongly issued.

About Dennis Crouch

Law Professor at the University of Missouri School of Law. Co-director of the Center for Intellectual Property and Entrepreneurship.

58 thoughts on “Court: Metallizing Engineering Overruled by Statute

  1. I did not find any holding in this lengthy D.C. opinion that Metallizing Engineering doctrine was overruled by the AIA. The Court in holding that the requirement of commercial exploitation was not met even for pre-AIA sales cited D.L. Auld Co. v. Chroma Graphics Corp., 714 F.2d 1144, 1147 (Fed.Cir. 1983) favorably in the context of a decision re the “on sale” bar, not the Metallizing doctrine. I found no suggestion that D.L. Auld was no longer valid.
    Although frequently confused, these two doctrines are very different. The AIA ending of secret product sales as “on sale” bars is about offers for sale of products containing the patented invention, and is based on the 102 definitions of what is prior art. In contrast, the purely personal equitable forfeiture of the Metallizing Engineering doctrine is NOT prior art and NOT statutory. It is for long standing commercial use of a secret manufacturing process that cannot be determined from the publicly sold products made by that process and which products do not contain the patented invention. [A far rarer fact situation.] My article cites and discusses the Fed. Cir. cases distinguished the two doctrines. Hopefully the Fed. Cir. will one day have a decision on a post-AIA patent sufficiently well researched and argued on this actual subject.

  2. Not to distract from the significance of the issues raised by the case, but palonosetron is not a “medical marijuana substitute” – it is a serotonin 5-HT3 receptor antagonist, discovered at Syntex in the late 1980s. 5-HT3 antagonists, starting with ondansetron and granisetron, have been used as antinausea/antiemetic agents since the 1990s: palonosetron is of particular use because of its long half-life, so it treats delayed nausea and emesis which would otherwise require administration of a second dose of a shorter-lived compound.

  3. Paul Morgan’s outstanding paper makes the very important point that the D.L. Auld v. Chroma Graphics case created law that parallels rather than interprets the pre AIA 102(b) provision relating to on sale. No convincing argument has ever been made that the AIA abrogated this case law forfeiture for secret commercial use doctrine by perhaps modifying the on sale provisions of the statute. The text of AIA 102(a) does not speak to secret commercial use explicitly or by necessary implication. If this forfeiture doctrine is alive and well, there is no need to torture the definition of “otherwise available to the public” to address a time wise extension of an inventor’s monopoly and in so doing capture what is truly developmental work by inventors with limited facilities as seems the case in The Medicines Company. In other words, there is no need to be intellectually dishonest about the meaning of publicly available and in so doing penalize inventors who need the help of third parties to perfect their inventions and must pay these third parties for their help

      1. Except not, as has been pointed out, Congress acted with the well known intent to overhaul 102/103 and remove certain such things (again, the Soliloquy is directly on point here).

        One just does not get to pretend that something is not there and then turn around and say “no convincing argument has ever been made.”

        That’s simply disingenuous and ignores the very written record of what Congress intended (and did) with the AIA.

        1. Except for just 2 Senators talking to each other, there is precious little to indicate Congress intended to reach any judicial doctrines as opposed to just adjusting the statutory provisions. Certainly there is nothing that deserves cognizance under the standards of statutory interpretation set forth in the late Justice Scalia’s book Reading Law to indicate a desire to reach the judicial forfeiture doctrine enunciated in DL Auld

          1. The item is on the record prior to the deciding vote.

            Like I said: you just don’t get to ignore something like that.

            (I have also pointed out other corroborating items as well).

            1. If Congress, as opposed to just a few Senators, intended to overrule or abrogate D.L. Auld why is there no trace of this intent in the committee reports? Just finding a statement in the Congressional Record is far from establishing the intent of a majority of the Representatives and Senators when they voted for a bill. That intent is typically discerned from the text of the bill for which they voted. If I were a Congressman who thought the AIA was a good bill but didn’t agree with the gloss the famous Soliloquy attempted to put on it, should I be presumed to agree with it, unless I went on record to refute it?

              1. As I have shared previously, the intent to radically change 102/103 is on the plain face of the act itself.

                When Congress so acts – it simply does not need to ferret out any and all judicial cases and say “these ones are out.”

                This is simply NOT a matter of hiding an elephant in a mouse hole.

                Quite the opposite – the mouse readily walks through the elephant hole.

                You should instead be asking, if you were a senator why would you have voted for what was passed.

                The text of the bill itself aligns with the Soliloquy – did you not pay attention to the explicit and direct rewording of the sections? Why do you think that certain explicit words were removed?

                The level that you need to go to to not understand this is truly breathtaking.

                1. Reading your sniveling b.s. and personal insults in this thread, “anon”, is enough to make any reasonble person p uke. Please get the medical help you need.

                  1. Whoever it was who counselled against wrestling with a pig had a good point. And besides, it really is not very edifying for either wrestler, is it?

                    Apart from that though, no real pig would enjoy it as much as our friend out there so very evidently does. I’m always hoping he will get bored and wander off, looking elsewhere for what he likes best. But then somebody goes and feeds him again.

                  2. Lovely A.O.O.T.W.M.D. there Malcolm.

                    There are not threats and my admonitions are hardly sniveling.

                    Mr. Pope has in the past bleated to a similar tune, and simply is choosing a path that just does not make sense.

                    He may not like what Congress has done (which is quite a different matter), but trying so very hard to not understand what has plainly happened and then pretend that “no convincing argument has been made” for something that just does not need that type of argument is more than just a little preposterous.

                2. Anon,
                  I agree with you – the language of the AIA in Section 102 is a disaster of ambiguity. However, it is not a “bug” – it is a “feature” designed by its proponents to obfuscate.

                  So to your point that the “on sale” and “public use” settled terms have been redefined by the AIA, do you agree then that such reading “of otherwise available to the public” adopted by the district court would eviscerate the settled “experimental use” exception to disclosing public use as enunciated in City of Elizabeth v. American Nicholson Pavement Co., 97 U.S. 126 (1877) (A patent for an improved pavement held valid even though the segment of the pavement about 75 feet in length on a road by way of experiment was publicly used). Similarly, would you also agree that “otherwise available to the public” throws under the bus the exceptions to a bar where a disclosing sale is primarily for a bona fide experimental purpose to perfect the invention rather than for commercial exploitation? A.B. Chance Co. v. RTE Corp., 854 F.2d 1307, 1311 (Fed.Cir.1988); Pennwalt Corp. v. Akzona, Inc., 740 F.2d 1573, 1581 (Fed.Cir.1984).
                  Of course, Congress did intend radical change in amending Section 102 – it moved us to the First to File system. However, if I understand you correctly, you believe that Congress must have also intended to hide an elephant (two centuries of jurisprudence) in this mouse hole (“otherwise available to the public”). Just for your information, the infamous Senatorial colloquy you refer to was inserted in the Senate Congressional Record one day after the Senate passed the bill (S 23). That could not have been the intent of all other 97 Senators who voted on the bill a day before. Now, if you think that this was mere sloppiness on the part of the Colloquy orators, think again; the bill would not have passed had Senators were made aware of this contorted construction and far-reaching meaning of repealing Pennock, Metallizing Engineering, and D.L. Auld.

                  1. Ron,

                    Thank you for vouching for my analysis – to a degree, and raising some additional rather important questions.

                    Of course, Congress did intend radical change in amending Section 102 – it moved us to the First to File system

                    The move to a First (Inventor) to File system was indeed a primary change, but most definitely not the only radical change (a few examples: inventor/owner “ease,” [your arguments with Lemley come to mind], removal of “with deceptive intent,” insertion of the submarine sui generis “right” of Prior User Rights, IPR,…)

                    the infamous Senatorial colloquy you refer to was inserted in the Senate Congressional Record one day after the Senate passed the bill (S 23)

                    If you recall correctly (and as I have mentioned before in discussions of the timing of the Soliloquy), the version that the senate passed that you reference went to the House, then came back to the Senate for a final vote – this was NOT a “surprise” item for all the other Senators. This Soliloquy inclusion passed the Senate with plenty of time and knowledge (or at least opportunity for knowledge). I know for a fact, as I know that both of my senators (not the ones involved in placing the item in the official record, under quorum) were informed of the consequences, because I called and told them so!

                    As to others not reading or understanding, PLEASE – that happens ALL THE Fn TIME in modern Congress.

                    There is NO such “oops, I did not read the actual words of the bill (or here, the intent of words on-the-record statement), so my vote was for something else excuse. JUST LIKE the affirmative denial of the bill having the quality of separability, these “little tings” matter in a BIG way.

                    Is this a “surprise?” No.

                    Is it a landmine (or to better fit my USS Titanic meme, a sea mine field)? Yes.

                    But as you suggest on another portion, I believe the LACK of separability was a bug and not a feature in the eyes of Congress. If the court’s do their job and find the unconstitutional aspects, then those special interests who lavished their “voice” on the Congress over the several years of the AIA’s evolution would have to (once again) line (the pockets) with their “voices.”

                    As to “ eviscerate the settled “experimental use” exception to disclosing public use,” the answer is “maybe.” I will have to re-read the Soliloquy with that “view” in mind, as I do not recall that was a take-away. But it could very well have been, in which case, YES, that too would be gone.

                  2. …this part should read:

                    believe the LACK of separability was a feature and not a bug in the eyes of Congress.

    1. Mr Pope you have aroused my interest in Paul Morgan’s Paper, which I must now read. Thanks.

      It occurs to me that the expression “made available to the public”, which we in Europe saw for the first time in a patent statute in the 1973 European Patent Convention, might today mean one thing in Europe and something quite different in the USA. Nearly 40 years of jurisprudence under the EPC has given us in Europe a clear sense of what it means. It seems that what it comes to mean in the USA will owe nothing to Europe’s 40 years of experience litigating the term, and everything to what courts in the USA have said over the centuries about “available” and “public”.

      So I wonder, how did “made available to the public” get into the AIA? Was it borrowed from Europe or did it come from some other source?

      1. Your continued insistence on “40 years leading to a clear sense” coupled with your well known views against stare decisis, greatly weaken your position.

        I continue to wonder why you do not understand the dichotomy of your being against stare decisis and the inherent instability that such a position dictates, and your view that ANY decision in that span of 40 years carries any sense of “stability,” as without stare decisis, there is no such ability to “bank” on past decisions.

        1. 20 years ago I supposed that there could be no legal certainty without stare decisis. Over the last 20 years though, I have seen how a system (the Boards of Appeal at the EPO) can bring more certainty through the steady evolution of the case law (1000+ decisions a year over 30+ years) on patentability/validity under the EPC. The proof is the White Book of EPO caselaw, and the practical task of giving real clients real opinions (against payment of large sums of real money) on what is patentable on each side of the Atlantic, and what is not. As ever, the Golden Rule of client service is “No Nasty Surprises”. How many of those do clients suffer, these days, each side of the Atlantic?

          1. Your “proof” is a fallacy.

            Again, your view is simply not congruent with the meaning of stare decisis.

            Unclench your eyes, wipe away your “feelings” which cloud a clear view of what the terms mean – and what that meaning portends.

      2. Dear Max, I’m not entirely sure from where the phrase arose but I believe it has some connection to efforts in court decisions to define “printed publication” and “known or used by others” in the pre-AIA version of our 35 USC 102(a). While I’ve corresponded with some folks involved in the drafting of the AIA, I was not at all involved. However, in the discussions and correspondence I’ve had with US colleagues I’ve seen great reluctance to take cognizance of, let alone adopt concepts from, any patent experience outside the US. Here is a link to a paper by Joe Matal on the development of the AIA. He was a key lawyer involved:link to uspto.gov

        1. Thanks Lawrence. I’m having no success with your kind Link, downloading Matal from the USPTO. Meanwhile though, I compare what Sen Leahy is reported (Morgan page 39) to have said “described in a printed publication, or in public use, on sale, or otherwise available to the public” with what Art 54(2) of the EPC prescribes, namely: made available to the public by written or oral description, by use or in any other way.

          One can see the similarities. And the differences, notably that in Europe’s 1973 text “made available” is the hook on which the rest is hung whereas in the AIA it is a tacked-on, catch-all afterthought.

          Was the “made available” in one jurisdiction inspired by the other though? Presumably not. Just a coincidence, eh?

          1. Concepts can be in parallel tracks – with noted similarities and differences – without the notions of either inspiration or coincidence.

            You are trying too hard to make some sort of causal connection.

  4. This case highlights something I’ve been saying for a long time, and contrary to this court’s construction, HEAVILY cuts against an applicant.

    The court cites Egbert. Egbert was a case where, as the district court summarizes: “The legal principle set forth in Egbert—that a claimed invention given or sold to one individual or entity in secrecy can constitute a public use—has proliferated a line of precedent in which secret sales or offers for sale bar patentability.”

    The district court also quotes directly from Egbert: “The Supreme Court found that the inventor’s corset improvement was in public use, noting that “[i]f an inventor, having made his device, gives or sells it to another . . . without limitation or restriction, or injunction of secrecy, and it is so used, such use is public, even though the use and knowledge of the use may be confined to one person.””

    The district court states that on sale now requires a “public sale” but forgets to import that the Supreme Court has already defined what constitutes “public” in terms of patent law: The sale/use to another without limitation or restriction.

    A corollary of that reasoning is that the same standard applies to printed publication statements (after all, the district court is treating them together as a group). Therefore a printed publication becomes prior art the second it is available to a single person not limited or restricted by the applicant, and the same with use.

    I have long made clear that the last time the Supreme Court spoke on the issue, they said that “public”, in patent law and elsewhere essentially means anyone who is not an agent of the inventor. The Supremes have ALWAYS drawn the line at inventor+his agents v. everyone else. It was the appellate level that construed “public” as generally available or widely distributed (i.e. synonymous with “notorious” or “widely distributed”). If a court links the on sale and public use bars and treats them under the same standard as publications the actual result is that publications become more inclusive of prior art, not that on sale and public use become less.

    This court gives no reason why the more strict standard applied to printed publications (which has never textually required more than knowledge “by others” anyway) is meant to be imported to the on sale bar as opposed to the less strict standard of on sale being imported to printed publications. And unfortunately for patentees, the Supreme Court in the very case he is citing *has defined what constitutes public.* One example of what this means is that a secret use by Inventor B is a public use with respect to Inventor A’s claim.

    There’s only two ways to look at AIA 102 – either it kept the same rules for the same categories that previously existed (which is the non-textual intent of the law) or it modified the rules. If it modified the rules you have to construe what “available to the public” means, and that standard has always been information that one could convey without reservation or liability. That is why leakers get punished while newspapers do not: The leaker makes secret information available to the public, the newspaper simply widely disseminates public information. It’s also a distinction for FOIA requests: There is information which is either available to the public or it isn’t. It doesn’t transition to an “available to the public” state once someone requests it. The dissemination has nothing to do with whether it was publicly available.

    1. I maintain that a constitutional standard that Congress cannot override is that they cannot issue a patent which has the effect of removing extent public domain knowledge or materials already available. (Graham; “Moreover, Congress may not authorize the issuance of patents whose effects are to remove existent knowledge from the public domain, or to restrict free access to materials already available.”)

      In other words if A secretly invents and secretly uses an invention and B later invents, files, patents, and sues, A’s proof of prior invention/use constitutes a constitutional protection against liability outside of 102.

        1. I’m not doing anything more than what repeating what they said Ned, which tends to get me up there on the scoreboard cause it turns out they like to repeat what they said too. Do you think a prior user (even if secret) means it is not existent knowledge? Do you not think the prior use by someone not beholden to you is public domain use?

          It’s simple dominion law – mastery over something makes you its master and the master of its progeny. But for a second inventor there is never mastery over the first inventor.

          1. Random, Under your facts, A cannot prove prior invention for the simple fact that A has kept the details of the invention secret. The statute’s limitation on prior invention to not “abandoned, suppressed or concealed,” does no more than implement Supreme Court case law.

            The Supreme Court understood the law to be this way in Kawanee Oil when it authorized state trade secret protection. By keeping the invention secret, the trade secret owner not only could not get a patent, but he could be sued for infringement. There was no defense of prior user at the time of Kawanee, only prior invention, and a trade secret user could not invalidate a patent based on trade secret use.

            1. A cannot prove prior invention for the simple fact that A has kept the details of the invention secret.

              You’re using prior invention under 102(g), I’m talking straight 102(a). It doesn’t matter if he is the prior inventor, he may not be the inventor at all, the only question is whether he has knowledge (under pre-aia) and a printed publication under aia 102. If he does, the fact that it is not widely disseminated does not make it not-public.

              By keeping the invention secret, the trade secret owner not only could not get a patent, but he could be sued for infringement.

              Kawanee Oil doesn’t say that. It says that it is likely that soon thereafter someone else will invent the same thing and they may disseminate and be rewarded for it, and that danger that someone else will invent works an incentive to disclose regardless of trade secret law. Kawanee isn’t even a patent law case, let alone an infringement case.

              1. Random, didn’t we discuss this before? Knowledge of an inventor is not public knowledge of the invention. I believe this principle was established in Pennock v. Dialogue.

                Thus even if two inventors invent the same thing, the public still does not have knowledge of the invention unless one of them publicly discloses.

                1. Knowledge of an inventor is not public knowledge of the invention. I believe this principle was established in Pennock v. Dialogue.

                  Does that logic hold under the construction that this court gave AIA 102?

      1. Read again Golan Random, and note that what you want to call a “Constituonal Standard” is not there (in the Constitution).

        Then read the (fa1led) attempt** at the reading of “invention” as strictly only being one first true inventor (as opposed to the notion of separate independent inventors engaging in a race).

        **i don’t recall the gentleman’s name… Madsted or something like that…?

    2. Random, the Supreme Court has also been consistent that the “on sale” bar applies to acts of the inventor or with the consent of the inventor. It further applies to sales (uses) of “the invention” to the public, and means, non confidential.

      But historically, the on sale bar has extended to the private use of patented machines and processes by the inventor (or those operating with his consent) to make products that are then sold to the public. See, Pennock v. Dialogue, the origin of the doctrine.

      The Feds have completely lost their minds on “on sale” by not even requiring a sale to the public of any product or service. Of course the district court here is going to grasp at straws to avoid the completely irrational holdings of the Federal Circuit that completely private development contracts are on sale bars.

      The Federal Circuit simply is the worst circuit court in history on patent law — and yet it holds a monopoly.

      1. The Feds have completely lost their minds on “on sale” by not even requiring a sale to the public of any product or service.

        I disagree with your statement at 7 that there is nothing commercial. The court found that the sale the MGI would have been on sale under pre-AIA. That sale occurred after Helsinn sought a “commercial partner” and the sale included as much (quantity) of a future good that MGI wanted. The fact that it was for a later delivery doesn’t mean that it wasn’t the sale of a product. The fact that the drug lacked regulatory approval (as opposed to being ready for patenting) also doesn’t matter.

        pg. 57 they say: “[I]t’s our standard practice that we grant the rights to a company to explore a patent, and with this, they pay us some licensing fees, and they then will pay us for future royalties on the sales. Concomitant, but subject to this licensing agreement, we also make a supply and purchase agreement that we set the stage for future supplies, once we arrive to get an approval, and also there the price is subject to the price that the company will achieve selling the product on the market”

        Seems pretty undisputed there is a clear licensing operation followed by a clear initial sale. This was not a case where they were simply licensing rights, *they were maintaining manufacturing capability and sold a physical embodiment subject to a distribution agreement.* What is the point of the on sale bar if you can profit immediately but delay the actual bar timer from starting until you deliver the goods?

        1. Random, it was my understanding that the contracts were for the supply of products in the future upon FDA approval.

          “A. Yes. This would set the stage of future purchase of product in the
          event that we would get to an approval of one or the other, if any, of the
          formulations that we were studying in the clinical trials.” Slip at *58.

          1. “the contracts were for the supply of products” together with proof that the product is an embodiment of the claimed invention is all you need to end the issue. The inventor bound himself to sell as much as MGI wanted to buy. The fact that it is for future delivery is irrelevant. All pre-orders are for future delivery but still constitute sales. Right now I have a preorder for 1 copy of The Force Awakens to be shipped to me from Amazon on April 5th. If Amazon doesn’t ship it have they breached? Of course they have. And what have they breached? The contract of sale for a blu ray. It’s the same contract except the quantity term is floating (“as much as MGI wants”) which is entirely proper in a contract for sale. Similarly, the fact that it is conditional isn’t an impediment to it being a sale either, sales contracts routinely have conditional terms (buying a house is a common example).

            It’s a completed sale, there’s just a delayed delivery. On top of that you have to remember that a completed sale is more than what the law requires – the law only requires an offer for sale. In other words, as soon as the inventor offered to sell embodiments of the claimed drug (even before the quantity, delivery and conditional terms were negotiated) the bar triggered. So even if you were right that one of those terms mattered to being called a sale (again, they don’t) it’s legally irrelevant because the bar triggered when they sat down to negotiate, not when they signed the deal.

            1. Random, do you distinguish between R&D contracts and contracts where the product is ready for patenting? I think the Supreme Court made that distinction in Pfaff.

              1. The finding was that it was ready for patenting prior to the offer to MGI…I viewed the contract as a sale of a particular compound and also a right to develop other compounds, i.e. the sale and the research were directed to two different things.

    3. either it kept the same rules for the same categories that previously existed (which is the non-textual intent of the law)

      Not a chance – with the explicit words of Congress itself – see the Soliloquy.

      1. Not a chance – with the explicit words of Congress itself – see the Soliloquy.

        So if it changed the rules, do you agree that the court has already defined “public” in Egbert and elsewhere and the phrase “otherwise available to the public” can be a single use by a single person who is not under an obligation to the inventor? How are we supposed to construe “otherwise available to the public” when the court has already construed what “public use” is?

        1. Many things in the AIA were poorly drafted – even with NO basis for new terms.

          Just because you see a term that was there prior to the AIA simply does not mean that the meaning carried over.

          The AIA is an horrendous piece of legislation (thankfully coupled with the “no-bulkhead” express INability for separability.

          The faster it sinks, the faster a better piece of legislation can be put in place.

          1. Just because you see a term that was there prior to the AIA simply does not mean that the meaning carried over.

            Is that a cannon of construction, or the opposite of a cannon of construction?

          2. The faster it sinks, the faster a better piece of legislation can be put in place.

            There is no “sinking” and there isn’t going to be any.

            1. That’s a nice conclusory statement (especially as you have deigned to not join in on any actual discussions of the Constituional fraility of the AIA and its explicit rejection of separability).

              Given such, your statement is given its appropriate weight.

              That is, the same weight that Morse’s Space has.

  5. Huh? As I understand the facts, this was a project to develop a new drug that involved several contracting entities. The contracts were for R&D, and for clinical trials.

    None of this was commercial.

    If the patentee is developing an invention for eventual commercial exploitation there simply is a lack of commercial exploitation. This is more akin to experimental use.

    Pennock v. Dialogue and Metallizing both require commercial use, something the patent owner was doing that was inconsistent with the intent and purpose of the patent law. Thus if a patentee were to commercially exploit a patented process in secret, producing products that are sold to the public, that must continue to be an on sale bar.

    Somehow, somewhere, the Federal Circuit and this district court has lost it. They do not, in the famous recent words of the Supreme Court, understand patent law.

  6. What would be the result for a pre-AIA patent but the sales occurred after implementation of the AIA? Isn’t the question ‘is the sale under AIA’ rather than is the patent under AIA?

    1. No. What you have described is a sale after the filing date. This has never been an issue. If the filing date is on or after March 16, 2013, then AIA rules apply. If the filing date is before March 16, 2013, then pre-AIA applies. If a transition app, then AIA applies with 102(g). Very straightforward.

  7. If the statute was intended to mean “available publicly” then why doesn’t it just say that? Why discuss sales at all?

    If one wanted to make it clear that selling the invention, including sales where the invention is included but not disclosed or described, then the statute could have been written: available publicly including being for sale generally, with or without disclosure of the invention to the public….

    1. Is this not a botched attempt to harmonise existing US law with that of the rest of the world. The 1973 European Patent Convention defines the “state of the art” as that which has been “made available” to “the public”. Hence there are by now thousands of decisions in Europe, that have been issuing steadily for the last nearly 40 years, on the issue what constitutes “the public” and what constitutes “making available”.

      Perhaps the framers of the AIA had in mind to stand on the shoulders of all that case law, draw inspiration from it, and learn from Europe’s many mistakes.

  8. How often does this happen? If there is a secret sale, at some point there will be a public use, right? And how often does any of that information make it to an Examiner’s desk?

    Though I can see that if this is made clearly the law, most sales of potentially patentable items will now be done in “secret” or under “confidentiality” out of an abundance of caution, even if it just because boilerplate.

    1. anony: If there is a secret sale, at some point there will be a public use, right?

      Not necessarily, at least not necessarily a public use by the seller/buyer in question.

      If the product in question doesn’t work, the project can be scrapped and (typically per the agreement) the remaining product is destroyed and any information about it is destroyed or kept confidential.

    2. Some of this may get worked-out in MedCo (now pending en banc), but some ‘secret sales’ include cases such as this one where drugs were ‘sold’ to hospitals and patients who were doing the drug treatment. In addition, many companies hire suppliers and ‘buy’ their custom from the supplier. Many companies even buy & sell goods between the various entities in the corporate structure.

  9. Given that the Federal Circuit habitually defers to the PTO on everything that goes *against* inventors (however implausibly), it would be outrageous for them to draw the line here.

    And what would be particularly absurd is to say they won’t honor Congress’s statutory change (and clear intent) on this, but they will for the grace period. They only limited the grace period to “disclosures” because they were counting on the “otherwise available to the public” to do likewise.

  10. It also falls in-line with what Paul Morgan suggested in his 2011 article.

    …which of course was proceeded by my analysis and comments on these very blog pages.

    could legitimately go either way… and the likelihood that…”

    The thumb on the scale with and likelihood is interesting.

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