All posts by Dennis Crouch

About Dennis Crouch

Law Professor at the University of Missouri School of Law.

Applying Festo to Claim Construction: Construing an Amended Claim

Claim Construction, Patent,

University of Texas v. BENQ, et al. (Fed. Cir. 2008)

In 2005, UT filed suit against a total of fifty-six defendants alleging infringement of claims 10 and 11 of its patent that converts text messages into binary syllabic elements before transmission.  After claim construction, the district court granted summary of non-infringement. 

Construction of Amended Claim: The appeal focuses on the term “syllabic element.” UT wanted the phrase to be broader than “a character set of one syllable.”  In its analysis of claim construction, the CAFC looked to the prosecution history.

After receiving a rejection during prosecution, UT added the “syllabic element” term to replace “an alphabetic character string” and cancelled a dependent claim directed toward matching whole words.  On appeal, the CAFC gave “substantial weight” to these amendments — presuming that the amended phrase could not be as broad as the original:

“[C]laim 10 originally recited matching with an alphabetic character string, while one of its dependent claims specified that this string comprised a word. After the examiner identified a reference that showed matching with a word, the Board of Regents limited claim 10 to require matching with syllabic element(s) and canceled the dependent claim that required matching with words. The cancellation of this dependent claim indicates that the set of “syllabic elements” does not include all words.”

In addition, because the amendment was made in order to overcome a prior art reference, the CAFC found it would be nonsensical to give the claim a definition as broad as the original:

“Moreover, if “syllabic elements” included words, then [the prior art] disclosure of matching with words would teach the portion of claim 10 that was amended to distinguish [the prior art]. We decline to adopt a construction that would effect this nonsensical result.”

Finally, the CAFC chose to hold the prosecution history against the patentee by ignoring potential arguments that lack explicit support in the intrinsic record.

“While the Board of Regents might have been able to distinguish [the prior art] on this ground, the intrinsic record fails to support the argument that it actually did so.”

Intermittent Infringement: The asserted method claim uses a comprising transition and requires that “each pre-programmed code being representative of a syllabic element.”  The accused products do use pre-programmed codes, but only some of them are representative of syllabic elements. Thus, the question on appeal was whether the claims require a vocabulary that includes only syllabic elements.  With some sophistry, the CAFC arrived at the result that an infringing vocabulary would only include syllabic elements. In particular, the claim reads as follows:

“…matching said binary code with one or more pre-programmed codes, each pre-programmed code being representative of a syllabic element; [and]

[f]orming a representation of the word from the one or more syllabic elements represented by the matched one or more pre-programmed codes…“

 Here, the CAFC used its grammatical analysis to find that the “matched” pre-programmed codes are a subset of the whole set of “each” pre-programmed code. The claim requires each pre-programmed code to be a syllabic element, ergo the entire set of pre-programmed codes must be in syllabic element form. q.e.d.

Claim construction and resulting summary judgment affirmed.

 

 

Patently-O Bits and Bytes No 52

Bits and Bytes, Patent
  • PatentLawPic379Judge Ward to BSC Counsel: “The court has never had counsel so recklessly disregard its orders before this trial” [Smith Discusses]
  • David Donoghue directs us to Victoria Pynchon’s article on ‘negotiating by e-mail.’ Bottom line: e-mail negotiations increase hostility. [Article][Donoghue]
  • I’m looking for a legal analysis of the potential pitfalls of outsourcing of patent proseuction. Anyone? dcrouch@patentlyo.com.
  • Paul Caron’s Law Prof Blog Ranking puts Patently-O tied for 5th in the nation based on web site visits in the past year.

Outsourcing of Patent Preparation: PTO Says Beware

Patent, Patent Prosecution, Transnational, , ,

In a recent notice, the PTO has indicated that it may be illegal to outsource invention information to a foreign county for the purposes preparing a US patent application.

  1. A foreign filing license from the USPTO does not authorize the exporting of subject matter abroad for the preparation of patent applications to be filed in the United States.
  2. Applicants who are considering exporting subject matter abroad for the preparation of patent applications to be filed in the United States should contact the Bureau of Industry and Security (BIS) at the Department of Commerce for the appropriate clearances.

(more…)

What’s Sauce For the Private Goose…

Articles and Publications, Patent, ,

Ilya Shapiro is a Senior Fellow at the libertarian Cato Institute in DC. He was also my classmate in both college and law school. In a recent op-ed for the Legal Times, Shapiro supported BPMC’s contention that the state of California should not be immune from charges of patent infringement.

What’s Sauce For the Private Goose…

by Ilya Shapiro (This article appeared in the Legal Times on June 2, 2008.)

… In Biomedical Patent Management Corp. v. California Department of Health Services, the biotechnology company known as BPMC is suing the state of California for patent infringement—specifically, of the company’s patent on a form of prenatal screening for fetal abnormalities. Ignoring the merits of the suit, the federal district court in San Francisco dismissed it on the ground of “sovereign immunity”: Under the Supreme Court’s reading of the 11th Amendment, a state cannot be sued in federal court without its consent. The U.S. Court of Appeals for the Federal Circuit—which handles all appeals in patent litigation—affirmed the lower court decision.

So BPMC has turned to the Supreme Court, which in recent years has been increasingly willing to reverse the Federal Circuit. The company wants the Court to strip California’s immunity in this case because the state’s Department of Health Services previously waived immunity when it joined a suit brought by a state contractor about the same patented procedure. That is, after California actively litigated the earlier suit (which sought and failed to obtain a declaratory judgment that the contractor was not infringing BPMC’s patent), the state should be precluded from turning around to claim immunity when it gets sued over the same issue.

Moreover, as BPMC notes, the University of California (among other state agencies) routinely submits to federal court jurisdiction when it pursues claims for violations of its own patent rights. Given that California uses the patent system (and courts’ enforcement thereof), it has relinquished whatever sovereign immunity the state enjoys—immunity that is legally suspect in any event when the sovereign engages in commercial activities.

And, boy, does California use the patent system. The state universities alone own more than 3,300 patents that generate $210 million in annual revenue. California has filed 21 patent infringement suits since 1990 and won more than $900 million in judgments since 2000.

And yet the state has also wielded sovereign immunity arguments to get suits dismissed at least six times since 1987 (including suits by Genentech and Eli Lilly & Co.).

While the worst peddler of this double standard, California is by no means alone. At least 32 states have filed at least 173 patent suits since the mid-1990s.

UNFAIR ADVANTAGE

Business groups hope that the Supreme Court will remove what they see as a competitive advantage enjoyed by state entities: Private patent holders can’t seek recompense for a state’s unlicensed use of software or medical devices, while states can turn to the courts to protect their patents. Medical innovators and technological entrepreneurs in the private sector suffer.

“It’s audacious for a state to use the federal courts to sue for patent infringement, but to block infringement suits against it as a sovereign that cannot be sued,” says Robin Conrad of the National Chamber Litigation Center in a press release. The center has filed an amicus brief on behalf of the U.S. Chamber of Commerce in the case—only the second time the Chamber has ever filed in a Supreme Court patent case.

This hypocrisy should not even be in play any more, not since Congress passed the Patent Remedy Act of 1992. That legislation was intended to “clarify that states .?.?. are subject to suit in federal court by any person for infringement of patents.”

That sounds clear enough. But in 1999 the Supreme Court ruled in a trademark case, College Savings Bank v. Florida Prepaid Postsecondary Education Expense Board, that Congress’ legislative powers under Article I of the Constitution were insufficient to trump states’ sovereign immunity. Except in 2006 the Court held the opposite in a federal bankruptcy case, Central Virginia Community College v. Katz. The votes in these seemingly contradictory decisions were 5-4.

In fact, neither case should have been close: When a state repeatedly and voluntarily invokes federal court jurisdiction in a series of similar cases—under patent or any other law—it generally has waived immunity against suits brought by private parties under those same laws. And the precedent is well established that a state waives sovereign immunity when it seeks to adjudicate its rights in federal court. For example, the Supreme Court unanimously held in the 2002 case of Lapides v. Board of Regents of the University System of Georgia that a state loses its 11th Amendment immunity when it removes a case from state to federal court.

EASY CALL

So, as the solicitor general’s office collects agency views and mulls the administration’s position, it should recognize that Biomedical Patent Management Corp.—an unwieldy name for an important case—not only represents the chance to right the balance between a state and its citizens with respect to intellectual property. It also provides the perfect opportunity for the Court to clarify its jurisprudence on the relationship between Congress’ Article I powers and states’ 11th Amendment immunity.

Sovereign immunity is properly a shield against lawsuits challenging a state’s governmental action, not a sword with which to carve out economic advantage over private competitors. If the Supreme Court declines to hear this case, thereby letting the Federal Circuit ruling stand, it would reinforce that unfair advantage—and strike a blow against private sector innovation.

Whoever it is that replaces the outgoing Paul Clement should not agonize over this one. The next solicitor general should advise the Supreme Court to grant this petition for review. And the justices should take his advice.

The Death of Google’s Patents?

Patent, Patentable Subject Matter, Software, , ,

By John F. Duffy* [File Attachment (42 KB)]

            The Patent and Trademark Office has now made clear that its newly developed position on patentable subject matter will invalidate many and perhaps most software patents, including pioneering patent claims to such innovators as Google, Inc.

            In a series of cases including In re Nuijten, In re Comiskey and In re Bilski, the Patent and Trademark Office has argued in favor of imposing new restrictions on the scope of patentable subject matter set forth by Congress in § 101 of the Patent Act.  In the most recent of these three—the currently pending en banc Bilski appeal—the Office takes the position that process inventions generally are unpatentable unless they “result in a physical transformation of an article” or are “tied to a particular machine.”[1] Perhaps, the agency has conceded, some “new, unforeseen technology” might warrant an “exception” to this formalistic test, but in the agency’s view, no such technology has yet emerged so there is no reason currently to use a more inclusive standard.[2]  

            The Bilski en banc hearing attracted enormous attention, and yet there has remained a sense among many patent practitioners that the PTO’s attempts to curtail section 101 would affect only a few atypical patent claims.  The vast bulk of patents on software, business and information technology are thought by some not to be threatened because those innovations are typically implemented on a machine—namely, a computer—and the tie to a machine would provide security against the agency’s contractions of § 101.  Even if that view were right, the contraction of patent eligibility would be very troubling because the patent system is supposed to be designed to encourage the atypical, the unusual and the innovative.  But that view is wrong.

            The logic of the PTO’s positions in Nuijten, Comiskey and Bilski has always threatened to destabilize whole fields of patenting, most especially in the field of software patents.  If the PTO’s test is followed, the crucial question for the vitality of patents on computer implemented inventions is whether a general purpose computer qualifies as a “particular” machine within the meaning of the agency’s test.  In two recent decisions announced after the oral arguments in the Bilski case, Ex parte Langemyr (May 28, 2008) and Ex parte Wasynczuk (June 2, 2008),[3] the PTO Board of Patent Appeals and Interferences has now supplied an answer to that question: A general purpose computer is not a particular machine, and thus innovative software processes are unpatentable if they are tied only to a general purpose computer.  

(more…)

Patent Appeals: The Elements of Effective Advocacy in the Federal Circuit

Book Review, Patent

PatentLawPic374Book: Patent Appeals: The Elements of Effective Advocacy in the Federal Circuit
Author: Mark Davies
Publisher: Oxford University Press

Cost: $85.00 from Amazon

Mark Davies recently authored the user manual for Federal Circuit appeals.  From its 300 spiral-bound pages, you can tell that the book is designed to serve the appellate attorney during the process of crafting a brief. Davies argued dozens of appeals as a DOJ appellate attorney and is now doing the same at O’Melveny in DC.

The book is very easy to read and understand, and it does an especially good job of providing concrete advice on how to draft an effective and clearly written brief while staying within the rules.

Davies adapts Strunk & White’s Elements of Style into a top five list that would benefit any writing: (1) Omit needless words; (2) Make the paragraph the unit of composition; (3) Use parallel and consistent writing form; (4) Use the active voice; and (5) Use definite, specific, concrete language.

His biggest general piece of advice is in all caps: DO NOT USE A DISTRICT COURT BRIEF AS A SHELL!

If you have an appeal pending, you better use the book.

 

Can a Patent Plaintiff Reserve Claims to be Filed in a Later Lawsuit?

Patent, Patent Cases 2008

PatentLawPic373Hemphill v. Kimberly-Clark (Fed. Cir. 2008 — appeal pending)

Over the past few years, the CAFC has been developing its jurisprudence on both claim preclusion and issue preclusion. A new appeal will likely add to the mix.

Hemphill initially sued Kimberly-Clark back in 2002 for infringement of claim 1 of her patent covering a tampon design. (U.S. Patent No. 4,557,720). Kimberly-Clark won that case on summary judgment of non-infringement.

Now, Hemphill has filed a new suit — alleging that the same Kimberly-Clark products infringe claim 2 of the same patent. The new case was dismissed under the theory of claim preclusion or res judicata.  Claim preclusion prevents re-litigation of the same case between the same parties. “[A] party who once has had a chance to litigate a claim before an appropriate tribunal usually aught not to have another chance to do so.”

Here, the new litigation involves the same parties, same product, and same patent. Based on the seemingly identical circumstances, the lower court held res judicata applies — and that Hemphill should have brought the charges under claim 2 in the initial proceeding.

In 2005, the CAFC held that res judicata does not apply when the second litigation involved a new patent — holding that “each patent asserted raises an independent and distinct cause of action.”  [Abbey v. Mercedes]  Likewise, the CAFC held in 2008 that res judicata does not apply when the second litigation involves an accused product that is not “essentially the same” as the originally accused product. [Acumed v. Stryker]

In all likelihood the CAFC will affirm here — holding that when a patentee holds-back certain claims within a patent that those claims will be lost.  A factor weighing heavily against Hemphill is that she is appealing pro se.

Links:

 

Patently-O Bits and Bytes No. 51

Bits and Bytes, Patent
  • Business Method Public Scrutiny: Peer-to-patent public review of pending applications is expanding to Business Method Patents. [PTO Press Release][ http://www.peertopatent.org/ ] .
  • CAFC Calendar: Check out this calendar before planning your next DC trip – Perhaps you can work-in a visit to the CAFC while it is in session. [CAFC Calendar].
  • Triway Pilot Program: The USPTO, EPO, and JPO are beginning a pilot program to share work. In this program, each office will conduct searches and the results will be shared. [LINK].
  • Public PAIR Access: Although file histories are an integral part of patent analysis and are often useful as prior art, the PTO offers no search tools for PAIR access. Furthermore, the PTO has thus far prevented companies from using automated engines to obtain bulk data in order to create an accessible database. Here is the PTO’s response so far: “There are no immediate plans to remove the CAPTCHA restriction. However, we are evaluating a solution that will ease the restriction and permit limited automated access. The USPTO is committed to providing access to public data, and recognizes the urgency in implementing support for both interactive and automated access to Public PAIR. The USPTO will keep you informed and involved as we continually work to improve access to public patent information contained in the PAIR system.”

When does a case become moot (and thus not an Article III controversy)?

Patent

Merck v. Apotex (Fed. Cir. 2008) (non-precedential)

Apotex filed an abbreviated new drug application (ANDA) to begin making a generic version of the osteoporosis drug FOSAMAX. The drug brought in over $3 billion in 2007. Merck sued for infringement and Apotex filed counterclaims of invalidity and non-infringement.

After some discovery, Merck decided to end the case by filing a covenant not to sue Apotex for infringement of the patents-in-suit and moved to dismiss all claims and counterclaims. Wanting to keep the case alive, Apotex then moved to add a Sherman Act antitrust claim for Merck’s activities. The district court denied Apotex’s motion and dismissed the case.

Even though Merck agreed not to sue, Apotex could not begin manufacturing a generic version because another company – TEVA – held exclusive rights as the “first generic.” In particular, because TEVA was the first ANDA filer, that company holds 180 days of market exclusivity once it begins marketing its product. If Apotex had won its case, TEVA’s 180 days would be triggered by the court decision. While the appeal was pending, TEVA – on its own – triggered the 180 day exclusivity period by starting to sell its generic version.

Moot Appeal: On appeal, the CAFC found Apotex’s case moot. Because TEVA’s 180 days were already running, a judgment of invalidity would not allow Apotex on the market any sooner.

Interestingly, the Washington Legal Foundation (WLF) filed an amicus brief arguing that the case be dismissed because there was no dispute over validity or infringement: “permitting courts to exercise jurisdiction in cases of this sort would expand federal court jurisdiction well beyond limits imposed by Article III of the Constitution and would put federal courts in the business of rendering advisory opinions.”

Antitrust: The CAFC also affirmed the lower court’s refusal to hear the Apotex antitrust claims because those claims failed to sufficiently plead an antitrust injury.

Case ordered to be dismissed as moot.

 

Obviousness is Reviewed De Novo

Patent, ,

Muniauction, Inc. v. Thomson Corp. and I-Deal (Fed. Cir. 2008) (Part II)

[Read Part I discussing joint infringement]

Muniauction’s patent relates to municipal bond auctions. During cross examination at trial, Muni’s expert admitted that two of the claims were identical to the prior art except for the patentee’s use of a web browser to access the auction. Despite that admission, the Pittsburgh jury refused to invalidate the patent leading to an award of $77 million for willful infringement. On appeal, the CAFC reversed – finding the claimed invention obvious.

No Obvious Deference: Like claim construction, obviousness is a question of law that is reviewed de novo on appeal. Despite that similarity, obviousness is normally decided by a jury. This difference is justified by the relatively small number of “underlying facts” in contention during claim construction as compared with plethora of factual issues that build up to a conclusion of obviousness. As the CAFC explained in the 2007 Dippin’ Dots opinion, “[t]hose factual underpinnings include the scope and content of the prior art, differences between the prior art and the claims at issue, and the level of ordinary skill in the art.”

Here, the court cited KSR to hold – as a matter of law – that the Muniauction improvement was nothing “more than the predictable use of prior art elements according to their established function.”

Broad Claims Create Trouble for Secondary Factors: Broadly written claims increase the chance that some prior art will be found to invalidate the claimed property right. Here, the CAFC also found that broad claims make it difficult to use secondary factors of patentability to establish nonobviousness. The particular issue here is that a tight nexus must link the claimed invention to the secondary factors (such as long felt need & market success).

“[C]ommercial success or other secondary considerations may presumptively be attributed to the patented invention only where ‘the marketed product embodies the claimed features, and is coextensive with them.'” Quoting Ormco v. Align.

Muni showed success of its products. However, the reports of success focused only on one portion of the invention as claimed. The appellate panel compared those narrow reports of success with the broad claims – finding that the success “lacks the required nexus with the scope of the claims.”

MUNIAUCTION: Joint Infringement Requires Mastermind

Patent,

Muniauction, Inc. v. Thomson Corp. and I-Deal (Fed. Cir. 2008)

Ray Niro’s team helped Muniauction win a jury verdict of willful infringement resulting in an award of $77 million for lost profit and enhanced damages. On appeal, the CAFC reversed finding some of the claims obvious as a matter of law and others not infringed. As its name implies, Muniauction’s patent relates to municipal bond auctions.

Infringement by a Single Actor: If it were not well understood already, this opinion completely rejects the rogue theory of joint infringement. Rather, a method claim is only infringed when a single party can be charged with performing each step of the asserted claim. Here, Muni’s claims required action by both a bidder and an auction system.

There are times when infringement can be found despite multiple actors. However, in those cases, a single party must be shown to exercise “control or direction” over the entire infringement. This is known as the “mastermind” requirement, and the CAFC has noted that it closely parallels the theory of vicarious liability.

“the control or direction standard is satisfied in situations where the law would traditionally hold the accused direct infringer vicariously liable for the acts committed by another party that are required to complete performance of a claimed method.”

The CAFC left some wiggle room. A later case could still hold that it is not necessary to show facts sufficient to support traditional vicarious liability. (This case notes that such facts would be sufficient, but does not state they are necessary). Thus activities by an independent contractor could potentially still be attributed to the principal. However, the court made clear that direct infringement will not be found when the steps of a method claim are performed “mere arms-length cooperation” between parties. I have suggested that the line be drawn with collusion or conspiracy to infringe rather than limited to principal-agent relationships.

Obviousness: Muni’s expert admitted that claims 1 and 31 were identical to a prior art system except for the patentee’s use of a web browser to access the auction. In a post-KSR world that type of invention is difficult to protect. The court reversed the jury verdict – finding the invention obvious as a matter of law. [More on Muniauction obviousness in tomorrow’s post]

Notes: The non-infringed claim reads as follows:

1. In an electronic auction system including an issuer’s computer having a display and at least one bidder’s computer having an input device and a display, said bidder’s computer being located remotely from said issuer’s computer, said computers being coupled to at least one electronic network for communicating data messages between said computers, an electronic auctioning process for auctioning fixed income financial instruments comprising:

inputting data associated with at least one bid for at least one fixed income financial instrument into said bidder’s computer via said input device;

automatically computing at least one interest cost value based at least in part on said inputted data, said automatically computed interest cost value specifying a rate representing borrowing cost associated with said at least one fixed income financial instrument;

submitting said bid by transmitting at least some of said inputted data from said bidder’s computer over said at least one electronic network; and

communicating at least one message associated with said submitted bid to said issuer’s computer over said at least one electronic network and displaying, on said issuer’s computer display, information associated with said bid including said computed interest cost value,

wherein at least one of the inputting step, the automatically computing step, the submitting step, the communicating step and the displaying step is performed using a web browser.

    

Patently-O Bits and Bytes No. 50

Patent,
  • Query: Does anyone use the XML links found within private PAIR?
  • Obviousness: Secondary factors are generally used to prove that an invention is nonobvious. Symmetry may cause us to think that factors may also exist that are useful in showing that an invention is obvious. A recent article by Brent Yamashita explores one of these: Simultaneous Invention. “[T]he fact that another person simultaneously and independently created the same invention claimed in the patent-in-suit can serve as an indication that the invention was obvious.”
  • EVENTS:  Upcoming events from American Conference Institute:
  • Patent Lie: I read A Patent Lie over the weekend — lots of fun for a patent attorney to read.
  • Tragedy of the Anticommons: Professor Heller’s new book is apparently an easy read. His work serves as a base for many who see IP rights as excessive and problematic. [LINK][Tim Wu Review]

    • CAFC Leans on District Court to Open Sealed Case

    Patent,

    Kuney v. Bean (BayState v. Bowers) (Fed. Cir. 2008)

    Professor Kuney is in the midst of writing a detailed account of the BayState v. Bowers case file. In that case, the CAFC affirmed the enforceability of a shrink wrap license term that barred reverse engineering of the software. In that case, a number of amici briefs argued that reverse engineering sits at the core of capitalism.

    Like most patent lawsuits, the documents filed and exchanged in the case are kept from the public – sealed under a stipulated protective order signed by the Massachusetts District Court. To open the file, Kuney filed a motion to intervene in the case and to modify the protective order. Bowers agreed to open access to the documents, but Bean (BayState’s successor in interest) initially refused. Although Bean and Kuney later agreed to a modified protective order, the court refused to enter it and rejected Kuney’s motion to intervene.

    On appeal, the CAFC found that the lower court had abused its discretion and vacated.

    Opening a Sealed File: “Intervention is the proper means for a non-party to challenge a protective order.” When making a determination of whether to open records, the courts should begin with “a presumption of public access to judicial records.” In a decade old case, the First Circuit explained the value of public access as fostering “the important values of quality, honesty, and respect for the judicial system.” In this case, the CAFC recognized that Kuney needs the documents to do his scholarly work. However, the district court created no record of weighing the value of public access against the presumption of privacy.

    Because the district court failed to explain its reason for dismissal, this case is vacated “for a balancing of the public and private interests in determining whether to grant or deny Professor Kuney’s motion.”

    Rich Baker Announces Congressional Bid

    Patent,

    Richard Baker is 3Com’s innovative intellectual property director. He is also running for Congress to represent the 6th District of Massachusetts as a Republican. (North of Boston). For many years, Baker has been a proponent of strong patent rights and monetization of those rights:

    “We need strong patent laws in the United States to protect our ideas, to protect our inventors, to protect our jobs, from infringers. For the past several years, many in Congress have been working hard to water down our patent laws, trying to make it easier for copiers to steal ideas. As an Intellectual Property Executive, I know the impact of these changes on the Massachusetts economy, and I will fight efforts to weaken our protection in the global economy.”

    Baker is the republican candidate and will be up against incumbent Democrat John Tierney in the fall.

    Links:

    Business System Patents

    Patent

    Ex Parte Simpson, Appeal 2008-0569 (BPAI 2008)

    HP’s patent application focused on software used to discover networked devices. Claim 32 was rejected for lack of statutory subject matter.

    32. A device discovery service stored on a computer-readable medium, the service comprising:

    logic configured to discover devices directly connected to a network that are not directly connected to a computer; and

    logic configured to provide a user home service accessible with a network browser with a list of at least one discovered device that is available for use on the network.

    This claim is interesting because like Wasynczuk, it involves a system claim that is not patentable subject matter.

    ‘These claims are directed to a “service” stored on a computer-readable medium, the service comprising logic “configured” to perform functions. Logic, read with reasonable breadth, includes descriptive material indicating the algorithm or reasoning behind an operational computer program, not the program itself. As such the claims are addressed to nonfunctional descriptive material, which is non-statutory. “When nonfunctional descriptive material is recorded on some computer-readable medium, in a computer or on an electromagnetic carrier signal, it is not statutory since no requisite functionality is present to satisfy the practical application requirement.” MPEP § 2106.01.’

    Similarly in Ex parte Godwin (BPAI 2008), the Board found that IBM’s “server system” claims non-statutory subject matter. In that case, the server was recited in the claim preamble and thus non-limiting.

    Apotex Challenge to ACULAR LS Patent Barred by Res Judicata

    Patent, ,

    Roche Palo Alto and Allergan v. Apotex (Fed. Cir. 2008)

    Roche’s patent covers drug formulations for treating eye inflammation and covers products sold as ACULAR and ACULAR LS. The two formulations differ in their proportion of various drugs such as an ammonium preservative and a surfactant.

    Hoping to sell generic versions, Apotex filed two ANDAs with the FDA – one for each formulation.  In response, Roche filed two separate infringement actions against Apotex (the ACULAR and ACULAR LS cases respectively). In 2007 the CAFC put a final nail in the ACULAR case by affirming the district court’s holding that the patent was not invalid and not unenforceable (infringement had already been decided).  This appeal involves ACULAR LS.

    Reverse Doctrine of Equivalents Remains Dead: In the 1950 Graver Tank opinion, the Supreme Court discussed how the reverse DOE can be used to limit the scope of claim coverage: “where a device is so far changed in principle from a patented article that it performs the same or a similar function in a substantially different way, but nevertheless falls within the literal words of the claim.” Although Graver Tank stands as good law, the CAFC has “never affirmed a finding of non-infringement under the reverse doctrine of equivalents.”  Here, the CAFC continued to reject the doctrine of reverse equivalents.

    Relying on a technical expert, Apotex argued that its formulation – although covered by the literal claims – operated under a different principle (involving the formation of micelles). The CAFC rejected this argument for several reasons: (1) the principle was derived from expert testimony without relying on the prosecution history which was not entered into evidence in the case; (2) the principle was not required in the specification; and (3) there was no evidence that the examiner relied on the principle in allowing the patent to issue.

    Claim Preclusion: Apotex hoped to challenge the patent’s validity a second time — this time with the benefit of the new KSR standards for obviousness. The district court, however, refused a second go-round — finding the claims precluded. In the Ninth Circuit, claim preclusion applies to prevent subsequent litigation where “(1) the same parties … were involved in the prior litigation, (2) the prior litigation involved the same claim or cause of action as the later suit, and (3) the prior litigation was terminated by a final judgment on the merits.”  In patent cases, the second suit is considered the “same claim” when the accused products are “essentially the same.”  The party asserting claim preclusion has the burden of proving that the accused products are essentially the same.

    Essentially the Same: On appeal, the CAFC held that analysis of whether two products are essentially the same (for claim preclusion) should focus on the claims. Here, the court affirmed that both the ACULAR and ACULAR LS formulations are essentially the same “because both formulations are encompassed by the [patent] claims.”

    “Though the court recognized that there are differences in the concentrations of the ingredients in the ANDA-1 and ANDA-2 formulations, it also realized that all of the concentrations are well within the ranges claimed in the ’493 patent. The fact that they are stabilized by different mechanisms, even if true, is irrelevant because both formulations are encompassed by the claims of the ’493 patent. Thus, any difference in composition between the two formulations is merely colorable and the two formulations are “essentially the same.”

    In addition, the CAFC confirmed that there is no “change of law” exception to claim preclusion — what is done is done. Thus, KSR gives no right to re-open closed claims. (*There are of course some exceptions to this role of no exception.).

    Notes:

    • Claim preclusion is also known as res judicata. The CAFC did not need to reach whether issue preclusion should also apply.
    • The CAFC’s claim preclusion jurisprudence appears to be developing a pro-patentee bias. Compare this Roche with the Acumed v. Stryker (a patentee does not lose rights by filing suit against only some of an accused infringer’s products).