July 2007

Reasons for Allowance Do Matter

Patent

Pharmastem_licensed2PharmaStem Therapeutics, Inc. v. Viacell, Inc. (Fed. Cir. 2007)(Read Part I of our analysis)

In addition to regular examination, the asserted patents had also been reexamined by examiners at the PTO.  Later, during litigation, several already cited references were used by courts as invalidation tools.

Patents are given a presumption of validity.  When previously considered references are asserted in an invalidity defense, the presumption of validity is even stronger.  Courts reason that such a challenge “bears the added burden of overcoming the deference that is due to a qualified government agency presumed to have done its job.” 

Here, however, the CAFC gave little weight to the Examiner’s review of references after finding a misstatement in the Examiner’s reasons for allowance.

The examiner … summarized her analysis of the prior art by stating that none of the cited references “addresses the presence of hematopoietic stem cells in umbilical cord or placental blood, that these cells may successfully be cryopreserved, or that, as a collection from a single human at birth, these cells may comprise an amount that is sufficient to effect hematopoietic reconstitution of a human adult.” That explanation is flawed for three reasons. First, as we have explained, the prior art references and the admissions in the specification address the presence of hematopoietic stem cells in cord blood, even though the references may not conclusively prove their presence. Second, Koike established that cord blood could be cryopreserved without substantial losses in the population of progenitor cells; the inventors contributed nothing more with respect to cryopreservation, as their mouse experiments were not performed with cryopreserved blood. Third, while the joint specification states that the amount of cord blood obtained at the time of birth would often be sufficient to transplant an adult, the inventors reached that conclusion simply by comparing the known properties of bone marrow against the results of routine testing of their own cord blood samples.

Although left ambiguous, it appears that the flaws in the Examiner’s final analysis gave the courts reason to take an entirely fresh look at the references in question.

Patently-O TidBits

Patent

Three blogs I (re)started reading today:

Patently-O Jobs continues to grow rapidly. 100,000 views in less than two weeks. Most popular categories:

 

Continuation Changes: Where we stand and What to Do

Patent

600px-Seal_Of_The_President_Of_The_Unites_States_Of_America_svgCurrent status of the USPTO’s changes to continuation and claiming practice:

  1. Rules Approved: Two sets of final rules have been approved by the Bush administration (OMB).
  2. Preliminary Rules Softened?: The preliminary rules published by the PTO limited the number of continuations that could be filed based on any given invention (continuation limitations) and also limited the number of claims per application that would be examined (claim limitations).  Unsourced leaks from within the PTO indicate that the final approved rules are somewhat softened from those originally released. The exact content of the final rules will not likely be available until the PTO publishes them in the Federal Register.
  3. Potential Rules: Hal Wegner and others have indicated that the new rules will potentially limit continuations for new applications to one RCE and two continuations. Further continuations would likely be available after showing cause. For applications already filed, the PTO may allow three continuations. Claim may be limited to twenty-five total claims, five of them independent.
  4. Timing: The PTO apparently has the green-light to move forward. The rules can become effective within 30–days of publication in the Federal Register.  My expectation is that the publication will occur in the range of Aug-Oct and the effective date will be in the range of Sept-Nov.
  5. Currently Pending Applications: It is almost certain that currently pending applications will fall within the continuation rules.  The currently pending applications will likely be allowed a third continuation. However, there are some indications (rumors) that recently filed applications (that have not yet received an office action) will be limited to two continuations. Any continuations filed after the rule change will fall within the claim-number limitations.
  6. What to do now?: Many companies have reportedly already filed continuation applications in the hope of avoiding some of rule-change sting.  That approach appears prudent – especially for valuable cases where multiple continuations have already been filed. You may want to talk with David Boundy (DBoundy@Cantor.com) about fighting the rules and Kevin Noonan (noonan@mbhb.com) about how your company should handle the rule changes. It appears that neither the IPO or AIPLA are actively opposing the rule changes.

 

Best Book for Learning Patent Law Practice?

Book Review, Patent

A skilled and motivated paralegal or assistant can more than double the effectiveness of a patent prosecution office. A Patently-O reader and new prosecution paralegal recently submitted the following question:

Hi, I’m currently working as a Paralegal in an Intellectual Property in-house legal department. Can you please tell me what will be the best book to learn patent prosecution from start to finish? I want to know dates, categories, subject matter (i.e., issued, published, granted and so forth).

Suggestions for our reader? Are there particular conferences or workshops best suited for paralegals and assistants?

OMB approves proposed changes to continuation practice.

Patent

The ORIA has concluded its review of the PTO proposed rules with approval . . .finding them “consistent with change.”

Links:

=====

AGENCY: DOC-PTO RIN: 0651-AB93
TITLE: Changes to Practice for Continuing Applications, Requests for Continued Examination Practice, and Applications Containing Patentably Indistinct Claims
STAGE: Final Rule ECONOMICALLY SIGNIFICANT: No
RECEIVED DATE: 04/10/2007 LEGAL DEADLINE: None  
** COMPLETED: 07/09/2007 COMPLETED ACTION: Consistent with Change
AGENCY: DOC-PTO RIN: 0651-AB94
TITLE: Changes to Practice for the Examination of Claims in Patent Applications
STAGE: Final Rule ECONOMICALLY SIGNIFICANT: No
RECEIVED DATE: 04/10/2007 LEGAL DEADLINE: None  
** COMPLETED: 07/09/2007 COMPLETED ACTION: Consistent with Change

Notes: Thanks to Brad Pedersen for the tip.

CAFC: Proving Utility Is Not Inventive

Patent,

PharmaStem Therapeutics, Inc. v. Viacell, Inc. (Fed. Cir. 2007)

PharmaStem sued six defendants for infringement of its broadly written patents covering cryopreserved umbilical cord stem cells useful for hematopoietic reconstitution. The defendants offer cryopreservation of umbilical cord blood to serve the donor later in life. A jury found infringement and validity, but the district court set aside the verdict — holding that the patents were not infringed.

Defendant’s Ads Not Specific Enough: The defendants advertised that their product would aid in hematopoietic reconstitution. However, the district court found (and the CAFC agreed) that the ads were insufficient to serve as an admission that the stem cells were “in an amount sufficient to effect hematopoietic reconstitution of a human adult” as required by the claims. This decision stands to reinforce the principle that a patentee must prove infringement of every limitation of every element of any asserted claim.

Infringe the Whole Claim: PharmaStem’s method claims include collecting, preserving, and using the stem cells .  The defendants, however, are only responsible for collecting and preserving the cells. Transplant physicians do the rest.

PharmaStem argued contributory infringement under 271(c) — alleging that the defendants sold or offered to sell a component of a patented method especially adapted for infringement. Of course, the defendants do not sell stem cell blood — rather they are “merely bailees”. Because 271(c) requires sale of a product, there is no infringement here.

Invention is Obvious: When asserting obviousness based on a combination of prior art references, the patent challenger must show that a PHOSITA “[1] would have had reason to attempt to … carry out the claimed process, and [2] would have had a reasonable expectation of success in doing so.”

Reason to attempt:

In view of the prior art references, the first part of that test is plainly satisfied here. The idea of using cryopreserved cord blood to effect hematopoietic reconstitution was not new at the time [of filing]. Two of the prior art references…suggest using cord blood for that purpose. Two others…suggest cryopreservation and storage of the cord blood until needed. Accordingly, this is not a case in which there is any serious question whether there was a suggestion or motivation to devise the patented composition or process.

Expectation of Success: The inventors appear to have conclusively proven that umbilical cord blood is capable of hematopoietic reconstitution.  Unfortunately for them, completing a proof is not necessarily inventive. Rather, prior scientists strong suspicion of the capability creates an expectation of success so strong that “no reasonable jury” could find the patent valid.

While the inventors may have proved conclusively what was strongly suspected before—that umbilical cord blood is capable of hematopoietic reconstitution—and while their work may have significantly advanced the state of the science of hematopoietic transplantations by eliminating any doubt as to the presence of stem cells in cord blood, the mouse experiments and the conclusions drawn from them were not inventive in nature. Instead, the inventors merely used routine research methods to prove what was already believed to be the case. Scientific confirmation of what was already believed to be true may be a valuable contribution, but it does not give rise to a patentable invention.

Holding: Patent is invalid and not infringed.

[More to come on this case]

CAFC Patent Appeal Statistics

Patent

The Court of Appeals for the Federal Circuit (CAFC) has created a new page of statistics.

  • Approximately 34% of CAFC decisions were patent cases. [LINK]
  • Patent appeals are less likely to settle pre-decision than other cases. [LINK]
  • Statistics for patent cases (9/05 – 9/06):
    • Total terminated: 496
    • Total terminated on merits: 278 (56%)
    • Of those terminated on on merits:
      • Percent affirmed: 60%
      • Percent affirmed-in-part: 20%
      • Percent dismissed: 3%
      • Percent reversed: 13%
      • Percent other: 4%
      • [LINK]
  • Check-out the CAFC Stats: [LINK]
  • See also PatStats.org

Further Limitations on Doctrine of Equivalents: Equivalent Foreseeable if Disclosed in Relevant Art

Patent

Patent.Law012Festo Corp. v. SMC Corp. (Fed. Cir. 2007).

In 1988, Festo sued SMC for infringement of its magnetized pistons.  Since then, the CAFC has issued numerous Festo opinions including two en banc. The Supreme Court has also ruled twice. This appeal, like many of the others involve the scope and limits of the doctrine of equivalents (DOE).

Doctrine of Equivalents: While patent claim language traditionally defines the patent right, the doctrine of equivalents occasionally allows for a finding of infringement even when an accused product falls outside the literal limits of claim language.  More particularly, DOE applies when a claim limitation differs insubstantially from the accused product or if the accused element performs the substantially same function in substantially the same way with substantially the same result (function/way/result test).

Prosecution History Estoppel: A narrowing claim amendment made during prosecution creates a presumption that the element should be narrowly interpreted — legally precluding application of the DOE.  In its 2002 Festo decision, the Supreme Court noted three exceptions that would allow for DOE infringement even after a narrowing amendment: (1) the equivalent was unforeseeable; (2) the reason for the narrowing amendment was only tangentially related to the equivalent; or (3) “some other reason…”.

Foreseeable Equivalent: In this case, Festo’s amendment was narrowing, but the patentee argued that SMC’s equivalent was unforeseeable to one of ordinary skill at the time of the amendment. The question was whether the accused product’s aluminum sleeve was a foreseeable alternative of the claimed magnetizable sleeve.  Aluminum sleeves were already well known in the art, but Festo argued unforeseeability because no PHOSITA knew that the aluminum sleeve would serve as a magnetic shield (the function of the sleeve). This unknown function — according to Festo — made the use of aluminum unforeseeable. In its briefs, Festo attempted to find a requirement for functional foreseeability in the function/way/result test of DOE.

The CAFC rejected Festo’s argument and instead found that foreseeability should be broadly interpreted — finding “that an alternative is foreseeable if it is disclosed in the pertinent prior art in the field of the invention.  In other words, an alternative is foreseeable if it is known in the field of the invention as reflected in the claim scope before amendment.” This result follows the court’s 2003 en banc decision that later developed and nonanalogous technology are “usually not foreseeable” — but that equivalents already known in the relevant field are generally foreseeable.

Here, the CAFC went a step further — implying that the question of whether a PHOSITA could have known the suitability of a particular a alternative is not relevant to the question of foreseeability.

“An equivalent is foreseeable if one skilled in the art would have known that the alternative existed in the field of art as defined by the original claim scope, even if the suitability of the alternative for the particular purposes defined by the amended claim scope were unknown.”

Consequently, the aluminum sleeve was seen as foreseeable – and thus prosecution history estoppel applies to block the doctrine of equivalents.

Dissent: Judge Newman dissents – noting that the opinion is “confound[ing]”, “incorrect”, and “futher erodes the residue of the doctrine of equivalents.”

4th of July Predictions

Patent

Here are my predictions:

  1. Although committee meetings will continue, substantive legislative patent reform is dead for 2007. There is simply too much opposition and too many varied viewpoints.
  2. Despite strong opposition, the proposed continuation rule changes will be implemented.

Happy Independence Day!

CAFC: General Purpose Computer Does Not Include RISC Processor

Patent

Patent.Law001Hutchins v. Zoll Medical (Fed. Cir. 2007)

[Updated] Hutchins is an individual inventor and represented himself pro [se] before the district court and on appeal. Hutchins’ patent relates to computer aided CPR. (U.S. patent no. 5,913,685). The district court granted summary judgment of noninfringement in favor of Zoll.

Hutchins lost on claim construction — with the courts holding that a “general purpose computer” does not include the RISC processors. The prosecution history made this finding easy as the “general purpose computer” limitation was added during prosecution to avoid “similar devices with dedicated microprocessor units.”

Patent Law Jobs by Patently-O

Patent

On July 1, Patently-O released its new job site: Patent Law Jobs by Patently-O. The site already has thirteen new job postings that have been viewed by several thousand patent law prospects. 

As usual with Patently-O, function predates style. We have job opportunities and patent professionals who need jobs. In the coming days, we’ll be working on a prettier design.

Hopefully, we can serve as a match-maker for each of these potential employers.

If you need patent help, please forward this info to your recruiting coordinator!

Notes:

  • Patent Law Jobs: www.patentlyo.com/jobs
  • Job Submissions: Post a patent law job
  • E-mail me comments (dcrouch@gmail.com)
  • Job postings are also going-out on the news wires via Google news. (not guaranteed…)
  • New job offers can always be found in the right sidebar on Patently-O. New jobs will also be included in the Patently-O e-mail service.

Honeywell as Lexicographer: Heading Defined as Bearing

Patent

Honeywell v. Universal Avionics (Fed. Cir. 2007).

GulfstreamHoneywell holds a patent covering a final-approach flight warning system. The novel system was able to determine whether the flight was in its final-approach without relying upon wing flap position. Universal’s TAWS system is allegedly infringing. After claim construction, a jury found infringement.

Honeywell’s claim discussed the “heading” of the aircraft in one element of the claim. The drafter should have used “bearing” instead because the focus was on the aircraft’s relative direction.  On appeal, the CAFC determined that the specification did its job of redefining heading and thus, allowed the court to define heading as the bearing.

The specification of the ’436 patent clearly communicates the meaning the patentees have assigned to the term “heading.” It does so by describing the claimed system’s alignment determination as depending on the direction of the aircraft from the runway (i.e., what is conventionally known as the aircraft’s bearing), not the direction in which the aircraft is pointing (i.e., what is conventionally known as the aircraft’s heading).

Lessen to consider: The patentee Honeywell won here because its patent claim was narrowly defined.

Notes:

  • In June 2007, another case between Honeywell and Universal was decided by the CAFC. [LINK]

Chemical Cases: Prima Facie Obviousness Requires “some Reason” for Modification

Patent

Takeda Chemical v. Alphapharm (Fed. Cir. 2007).

Alphapharm filed an ANDA with the FDA — hoping to begin making generic version of Takeda’s patented diabetes treatment ACTOS. ($1.7 b annual sales). The district court found the invention nonobvious, but Alphapharm asked the CAFC to review the case under the new standards of KSR v. Teleflex. On appeal, the CAFC affirmed.

Graham Primary Law: In the 1966 case of Graham v. John Deere, the Supreme Court set forth the primary methodology for determining obviousness. That methodology requires an examination of 1) the scope and content of the prior art; 2) differences between the prior art and the claims; 3) level of ordinary skill in the pertinent art; and 4) objective evidence of nonobviousness.  According the CAFC, KSR left the Graham formula intact, but added the provision that the test must be flexibly applied.

Although flexibility is required, one inflexible rule is that a prima facie obviousness rejection requires at least “some reason” that would have led a chemist to modify the prior art in a particular manner. Here, the court could find no reason for such a modification or that the modification would have been ‘obvious to try.’ – validity affirmed.

Genus-Species Unexpected Results: Judge Dyk in Concurrence indicated that two of the broader claims were likely invalid based on a rule of unexpected results for species:

In my view a species should be patentable over a genus claimed in the prior art only if unexpected results have been established.

 Dyk concurred with the validity finding because the “overbreadth” argument had been waived.

 

Written Description: CAFC Finds Prima Facie Rejection

Patent

Hyatt v. Dudas (Fed. Cir. 2007)

Under MPEP guidelines, the addition of new claims limitations lightens the examiner’s burden of proving inadequate written description.  In particular, Section 2163.04(I)(B) provides for a Section 112 rejection of a newly amended claim where “Applicant has not pointed out where the new (or amended) claim limitation ‘____’ is supported, nor does there appear to be a written description of the claim limitation in the application as filed.”

In this case, Gilbert Hyatt had filed a new set of claims in a continuation (claiming priority back to 1970’s) and the examiner rejected those claims for lack of written description. Without arguing the merits, Hyatt focused his appeal on the examiner’s failure to provide a prima facie case — and the legal founding of the MPEP provision.

During prosecution, the PTO is given the initial burden of providing a prima facie case for any rejection. The rejection must include at least some specifics regarding problems with the claims.  However, that requirement can be met through an explanation of “what, in the examiner’s view, is missing from the written description.”

MPEP is OK: The CAFC found that MPEP 2163.04(I)(B) is properly written because it requires specific recitation of the problematic claim language (as opposed to a vague general rejection)

[S]ection 2163.04(I) expressly instructs the examiner to specify which claim limitation is lacking adequate support in the written description.

Specifics?: The examiner’s written description rejection asserted that the claimed combination was not adequately described (although each particular element was described).  After reviewing the rejection, the CAFC found that the examiner’s focus on “support for linkage” was sufficient to “clearly notif[y Hyatt] of what exactly the examiner felt was missing by way of written description.”  This shifted the burden going forward, and consequently, Hyatt is now under a duty to bring-forth the requested descriptive evidence.

Notes:

  • Gilbert Hyatt is known for receiving a broad patent on the microcontroller.  (That patent was later invalidated in an interference with TI).
  • Before the patent was invalidated, Hyatt received $70 million+ in royalties.
  • California wanted Hyatt’s taxes and took the case to the Supreme Court. (California v. Hyatt)