Best Mode: District Court Improperly Invalidated Patent that Mis-Identified Best Mode

Green Edge Ent. LLC v. Rubber Mulch Etc. LLC (Fed. Cir. 2010)

You might guess from the names of the parties that the subject matter of the dispute is rubber mulch. Green Edge's patent covers a synthetic rubber mulch that is shaped and colored to imitate a natural mulch. In its patent application, Green Edge indicated that a variety of systems could be used to add color to the rubber, but the application also spelled out one particular "VISICHROME" system by Futura Coatings as being the "most preferred" system. It turns out that Futura Coatings never made or sold system under the name of VISICHROME. Rather, the product Green Edge should have identified was "Product Code 24009." The name VISICHROME apparently came from a sales letter from a Futura Vice President who had referred to a VISICHROME system.

Best Mode: During the infringement litigation, the Eastern District of Missouri court held the patent invalid for failure to disclose the best mode under 35 USC § 112 – finding that VISICHROME did not exist and "that Green Edge had concealed the best mode by disclosing 'a misleading, non-existent name instead of the number' when no similar product was available on the market."

Section 112 of the patent act requires that the patent specification "set forth the best mode contemplated by the inventor of carrying out his invention." Federal Circuit precedent has held that such a "best mode" need only be described if the inventors subjectively possessed a best mode on the filing date of the application. Even then, the question is whether the inventor "concealed" the preferred mode from the public.

The second prong asks whether the inventor has disclosed the best mode and whether the disclosure is adequate to enable one of ordinary skill in the art to practice the best mode of the invention. The second inquiry is objective; it depends upon the scope of the claimed invention and the level of skill in the relevant art.

Although not suggested by the statute, the best mode requirement is generally examined on an element-by-element basis. Here, Green Edge clearly had a preferred approach for coloring the rubber pieces and thus was required to disclose that "best mode."

On appeal, the Federal Circuit reversed – holding that the best mode had not been objectively concealed. The court's reasoning was that a competitor looking for "VISICHROME" might have been able to find it around the time of the invention since at least one Futura Coatings executive had been using that name in sales letters.

The disclosure might have, at the time the application was filed, been specific enough to describe the colorant so as to enable a person of ordinary skill in the art to make the claimed product using Futura's 24009 product. The application for the '514 patent was filed in October 1997, and [the Futura VP's] letter describing Futura's "Visichrome" colorant system was written in July 1997. Thus, despite [the VP's] inability to remember why he used the term "Visichrome" in his letter, it is at least possible, even likely, that in October 1997, at the time of filing, someone contacting Futura to obtain the "Visichrome" colorant system would have received a response similar to Jarboe's letter of that July.

In the end, the court held that summary judgment was inappropriate. On remand, a jury could still find the patent invalid on best mode.

Written Description: Description Must do more than Allow PHOSITA to “Envision” the Claimed Invention

Goeddel v. Sugano (Fed. Cir. 2010)

When two inventors both claim rights to a single invention, the USPTO is charged with awarding rights to the “first applicant to conceive the invention, provided that [inter alia,] the invention is duly reduced to practice, actually or constructively.” A foreign-filed patent application can constitute constructive reduction to practice “provided that the requirements of §112 are met.”

Sugano filed its original human fibroblast interferon (hFIF) patent applications in Japan in 1979 and 1980 but did not file the claims for the US continuation-at-issue until the 1990s. Meanwhile, Goeddel filed its application in June 1989. In the interference, Goeddel argued that Sugano’s original filings did not provide sufficient disclosure to satisfy the written description requirement of 35 U.S.C. §112 (with respect to the claims being litigated in the interference).

The BPAI (Board) held that Sugano’s 1980 Japanese Application constituted constructive reduction-to-practice of the claims. On appeal, however, the Federal Circuit has reversed – holding that the disputed claims failed the written description test because claimed DNA sequence used to create an hFIF amino-acid sequence was not explicitly defined by the original application.

The Board erred in ruling that priority is established if a person of skill in the art could “envision” the invention of the counts. Sugano argues that this ruling is supported by Enzo Biochem, Inc. v. Gen-Probe Inc., 323 F.3d 956, 968 (Fed. Cir. 2002) and University of Rochester v. G.D. Searle & Co., 358 F.3d 916, 923 (Fed. Cir. 2004), but these cases do not hold that envisioning an invention not yet made is a constructive reduction to practice of that invention. In Enzo Biochem the court confirmed that depositing an actual sample may meet the written description requirement when science is not capable of a complete written description. Enzo Biochem, 323 F.3d at 970. In University of Rochester the court held that the description of the COX-2 enzyme did not also serve to describe all unknown compounds capable of inhibiting the enzyme. University of Rochester, 358 F.3d at 926-27. Precedent in evolving science is attuned to the state of the science, but remains bound by the requirement of showing “that the inventor actually invented the invention claimed.” Bradford, 603 F.3d at 1269; see Fiers v. Revel, 984 F.2d 1164, 1170 (Fed. Cir. 1993).

Sugano had argued that the specific DNA sequence coding for the amino acids was not necessary because a person of skill in the art could have identified the sequence and therefore, it was “unnecessary to spell out every detail of the invention in the specification.” The appellate panel rejected that argument – holding that the DNA itself should have been identified since the DNA sequence was claimed.


  • Genentech owns Goeddel’s rights while the Japanese Foundation for Cancer Research owns Sugano’s rights. (Schering is a licensee).

Successor Corporation Held Liable for Default Infringement Judgment Against Predecessor

DaewooFunai Electric Company v. Daewoo Electronics Corp. (Fed. Cir. 2010)

In 2004, Funai Electric sued four Daewoo entities for infringement of its patents covering various improved video cassette recorders (VCRs). Funai is a Japanese manufacturer of AV equipment. Daewoo was a historic Korean chaebol that splintered after a financial collapse in the late 1990’s.

Successor Liability: Two of the Daewoo defendants are predecessor companies of the other two defendants. One predecessor-successor pair includes Korean companies and the other pair includes their American counterparts.  At the time of the lawsuit, the two predecessor companies had legally transferred assets to their successors but had not yet ceased operations.  About one-year into the lawsuit, the two predecessor companies stopped participating in the litigation. The district court ordered a default judgment and awarded $8 million in default damages.  Funai then asked that the successor companies be held liable for the liabilities of their predecessors. The district court applied Korean corporate and contract law to hold that there is no successor liability. 

On appeal, the Federal Circuit reversed that judgment — holding that US successor-liability law (actually, New Jersey law) should apply when determining whether the American successor company is liable for the actions of its predecessor. Under New Jersey law, a successor company is liable when the business transfer is simply a “new hat” for the business. Since that was the case here, the Federal Circuit determined that the successor is liable for the default judgment.

The 50–page opinion (including a concurrence by Judge Linn) discussed several other issues. Notably, the opinion provides another example of a prosecution amendment made for purposes “tangential to patentability” and that therefore avoids prosecution history estoppel.

Prosecution History Estoppel: Funai argued that one of its asserted claims was infringed under the doctrine of equivalents (DOE).  Daewoo countered that DOE should be limited under the doctrine of prosecution history of estoppel based on a narrowing amendment made during prosecution of the application. In particular, the patentee had cancelled claims 1 and 2 and then added limitations from those claims into a former dependant claim.  The original claim 1 did not spell-out how insulation would take place while the amended claim indicated that a bearing holder would be “made of an insulating material.”

Under the Supreme Court’s Festo decision, an amendment made during prosecution does not implicate a prosecution history estoppel bar if the “rationale underlying the amendment [bears] no more than a tangential relation to the equivalent in question.”  On appeal, the Federal Circuit recognized the amended claim set as being narrowed, but held that “no estoppel exists” because amendment relating to the insulating material was made for purposes merely tangential to the patentability of the claim. 

It is apparent that the nature of the insulating material was not a factor in the allowance of claim 4, for this aspect was not at issue during prosecution. This limitation is in the category that the Court called “merely tangential” to the prosecution, as discussed in Festo.

The court therefore affirmed the holding of infringement under the doctrine of equivalents.

Federal Circuit Holds-Line on Patent Misuse Defense

By Dennis Crouch

In a split decision, an en banc Federal Circuit has held that the non-statutory equitable doctrine of patent misuse should be narrowly applied. Here, the court held that an anticompetitive agreement between companies to suppress a given technology would not constitute misuse of a patent covering an alternative technology being promoted by the companies. Thus, the patents can still be enforced. Of course, companies following this pathway could still be liable for antitrust violations.

Princo Corp. v. International Trade Commission and U.S. Philips Corp. (Fed. Cir. 2010) (en banc)

The alleged patent misuse was associated with a CD-R/RW patent-pool arrangement between Philips and Sony. The two companies chose a particular method (Raamaker) of encoding location information on the CD to serve as the standard and then allegedly suppressed another method (Lagadec). (Both methods were covered by patents held by the companies.)

Princo argued here that creation of the patent pool licensing the Raamaker method and the suppression of the Lagadec method constituted patent misuse and should render the patents undenforceable.

Patent Misuse:     

The doctrine of patent misuse is … grounded in the policy-based desire to 'prevent a patentee from using the patent to obtain market benefit beyond that which inheres in the statutory patent right.' Mallinckrodt, 976 F.2d at 704. It follows that the key inquiry under the patent misuse doctrine is whether, by imposing the condition in question, the patentee has impermissibly broadened the physical or temporal scope of the patent grant and has done so in a manner that has anticompetitive effects. B. Braun, 124 F.3d at 1426. Where the patentee has not leveraged its patent beyond the scope of rights granted by the Patent Act, misuse has not been found. See Monsanto, 363 F.3d at 1341 ("In the cases in which the restriction is reasonably within the patent grant, the patent misuse defense can never succeed."); Virginia Panel, 133 F.3d at 869 (particular practices by the patentee "did not constitute patent misuse because they did not broaden the scope of its patent, either in terms of covered subject matter or temporally"). . . .

Given that the patent grant entitles the patentee to impose a broad range of conditions in licensing the right to practice the patent, the doctrine of patent misuse "has largely been confined to a handful of specific practices by which the patentee seemed to be trying to 'extend' his patent grant beyond its statutory limits." USM Corp. v. SPS Techs., Inc., 694 F.2d 505, 510 (7th Cir. 1982).

Recognizing the narrow scope of the doctrine, we have emphasized that the defense of patent misuse is not available to a presumptive infringer simply because a patentee engages in some kind of wrongful commercial conduct, even conduct that may have anticompetitive effects. See C.R. Bard, Inc. v. M3 Sys., Inc., 157 F.3d 1340 (Fed. Cir. 1998) ("Although the defense of patent misuse . . . evolved to protect against 'wrongful' use of patents, the catalog of practices labelled 'patent misuse' does not include a general notion of 'wrongful' use."). Other courts have expressed the same view. See Kolene Corp. v. Motor City Metal Treating, Inc., 440 F.2d 77 (6th Cir. 1971) (There is no such thing as "misuse in the air. The misuse must be of the patent in suit. An antitrust offense does not necessarily amount to misuse merely because it involves patented products or products which are the subject of a patented process." (citations omitted)); McCullough Tool Co. v. Well Surveys, Inc., 395 F.2d 230 (10th Cir. 1968) (the defense of patent misuse has been allowed "only where there had been a misuse of the patent in suit"). While proof of an antitrust violation shows that the patentee has committed wrongful conduct having anticompetitive effects, that does not establish misuse of the patent in suit unless the conduct in question restricts the use of that patent and does so in one of the specific ways that have been held to be outside the otherwise broad scope of the patent grant.

On appeal, the en banc Federal Circuit held that this case does not fit with other misuse precedent. "This case presents a completely different scenario from the cases previously identified by the Supreme Court and by this court as implicating the doctrine of patent misuse." In particular, the alleged misuse was alleged agreement to suppress "an entirely different patent that was never asserted." "Even if such an agreement were shown to exist, and even if it were shown to have anticompetitive effects, a horizontal agreement restricting the availability of Sony's Lagadec patent would not constitute misuse of Philips's Raaymakers patents or any of Philips's other patents in suit."

Reduced to its simplest elements, the question in this case comes down to this: When a patentee offers to license a patent, does the patentee misuse that patent by inducing a third party not to license its separate, competitive technology?

The court answered this question with a resounding "no" – such an action "would not fall within the rationale of the patent misuse doctrine as explicated by the Supreme Court and this court." In particular, the patent-in-suit there must be a direct connection between the patents-in-suit and the alleged misconduct.

Dissent: Judge Dyk (joined by Judge Gajarsa) wrote a 32-page dissent arguing that the patent misuse doctrine should be given teeth:

Evidently the majority thinks it appropriate to emasculate the doctrine so that it will not provide a meaningful obstacle to patent enforcement. . . . Indeed, the majority goes so far as to suggest that the misuse doctrine be eliminated entirely. I read the relevant Supreme Court cases and congressional legislation as supporting a vigorous misuse defense, clearly applicable to agreements to suppress alternative technology. The majority cabins the doctrine in contravention of this Supreme Court authority. I respectfully dissent.

Lack of “Engineering Details” in Claim Hampers NonObviousness Argument

Martin v. Alliance Machine (Fed. Cir. 2010)

In considering secondary indicia of nonobviousness, Chief Judge Rader tends to focus on whether a nexus exists between the presented objective evidence and the invention as claimed. Here, Judge Rader applied a similar methodology in examining the differences between the prior art and the claimed invention. (Deere).

Martin's patent covers an improved machine for splitting cardboard bundles. The patented design uses top-down pneumatic pistons to hold the bundles in place. The prior art design uses bottom-up pneumatic pistons. In arguing non-obviousness, Martin's expert pointed-out that it would not work to simply flip the prior-art design on its head. Rather, any such conversion would require extensive engineering detail. Judge Rader rejected that argument — holding that the "engineering details" argument was irrelevant because the claims did not identify any of those details.

[Martin] relies on the testimony of Alliance’s own Director of Research and Development that, “from an engineering standpoint,” one cannot simply take the Pallmac design and flip it from bottom to top. That testimony, however, is irrelevant to the obviousness analysis. With one exception, discussed below, the claims themselves do not recite engineering details but merely require that the compliance structures be mounted to clamps that are “above” the conveyor belts.

After rejecting all of Martin's nonobviousness arguments, the appellate panel affirmed the lower court's invalidity holding.

Construing the “Function” of a Means-Plus-Function Claim Element

Gregory Baran v. Medical Device Technologies (Fed. Cir. 2010)

Dr. Baran sued MDTech for infringing his patents covering automated biopsy instruments. Soon-to-be Federal Circuit Judge Kathleen O’Malley over-saw the district court case. After construing several disputed claims, Judge O’Malley ordered summary judgment of non-infringement. On appeal, the Federal Circuit affirmed.

Means-Plus-Function: I’ll focus on an interesting question raised regarding Baran’s means-plus-function (MPF) limitation. The limitation reads as follows: a “release means for retaining the guide in the charged position.” 

35 USC 112 p6 provides for MPF claim elements expressed “as a means or step for performing a specified function.”  The statute calls for the limitation to be “construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof.”  Federal Circuit precedent has logically added that the statutory “corresponding structure” are structures that perform the claimed function.

What is the Claimed Function?: Here, the Federal Circuit was asked to construe Baran’s MPF element to identify the claimed function.  MDTech argued that the claimed “release means for retaining” required a structure that exhibited both a releasing function and a retaining function.  Dr. Baran argued that the claimed function was only that of retaining.  On appeal, the Federal Circuit agreed with the lower court that the means-preamble “release” added a functional limitation to the claim element.

[T]he claim language recites both a release function and a retention function. Dr. Baran’s argument regarding the placement of the term “release” is unavailing. The relevant inquiry is whether the term at issue is purely functional. See Signtech USA, Ltd. v. Vutek, Inc., 174 F.3d 1352, 1356 (Fed. Cir. 1999) (construing “ink delivery means” to be equivalent to “means for ink delivery” because “ink delivery” was purely functional language); Al-Site Corp. v. VSI Int’l, Inc., 174 F.3d 1308, 1318 (Fed. Cir. 1999) (“[W]hen it is apparent that the element invokes purely functional terms . . . the claim element may be a means-plus-function element despite the lack of express means-plus-function language.”). In the context of the ’797 patent, the term “release” is not an idle description but a vital function to be performed by the means-plus-function element. The patent does not recite a biopsy instrument that retains indefinitely without release; rather, the contemplated function is to retain for the express purpose of producing a spring-loaded release on demand. The claim language ties both functions to the same means-plus-function element, so it is appropriate that the element be construed accordingly.

Although it is difficult to take-away lessons from claim construction decisions, a potential best-practices approach to drafting MPF claims may be to eliminate any adjectives tied directly to the “means.”  Of course, my best practice suggestion is intended for those times when you want to draft MPF claims with clarity.

Adams Respiratory Therapeutics v. Perrigo – construction of pharmacokinetic claim terms

Adams Respiratory Therapeutics, Inc. v. Perrigo Company (Fed. Cir., August 5, 2010)
Panel: Linn, Moore (author), Friedman

By Jason Rantanen

Adams holds patent number 5,372,252, which covers an extended release formulation containing guaifenesin (an expectorant used to thin, loosen, and help expel mucus that causes congestion).  Perigo sought FDA approval for a generic version of Adams' product, Mucinex®.  After construing the claims, the district court granted summary judgment of noninfringement.  Adams appealed that decision.

The claim terms in dispute related to pharmacokinetic parameters.  These parameters are used to characterize the rate and extent of absorption of the active pharmaceutical ingredient ("API").  The primary term at issue, Cmax, indicates the maximum concentration of the API following dosing.

"Equivalent Cmax"
The parties' main dispute was over the meaning of the term "equivalent" in the context of "provides a Cmax in a human subject equivalent to the Cmax obtained when the first of three doses of a standard immediate release formulation having one third the amount of guaifenesin is dosed."  For purposes of FDA approval, a formulation is considered to be bioequivalent if, among other things, its Cmax is within 80% to 125% of the value with which it is being compared at a 90% confidence interval. The district court agreed with Perrigo that "equivalent" should be construed to mean equivalent under the FDA bioequivalence guidelines.

On appeal, Adams challenged the requirement of a 90% confidence interval, arguing that it makes sense when seeking FDA approval, but not when proving infringement. 

The Federal Circuit agreed with Adams.  In doing so, it rejected Perrigo's argument that the inventors had expressly defined "equivalent" as te FDA's bioequivalence guidelines.  Rather, the court construed Adams' reference to the FDA guidelines as referring specifically to the 80-125% range, not to the requirement of a 90% confidence interval.  According to the court:

Requiring a 90% confidence interval would inappropriately raise the bar for establishing infringement.  Adams must show that it is more likely than not that Perrigo's ANDA product will have a Cmax within the 980-125% range. Adams is not required to show that Perrigo's product will meet this requirement 9 times out of 10.

Slip Op. at 8.

Comment: This interpretation opens up a box of statistical worms, and I suspect that down the line the court may regret its venture into probability theory.  For the time being, however, it gives parties useful language to quote when attempting to prove infringement (and perhaps invalidity) via clinical results. 

A ≈ B ≈ C therefore A ≈ C
Adams also appealed the district court's ruling that it  impermissibly compared the accused product to Mucinex.  Adams' argument was that because the accused product was bioequivalent to Mucinex, and Mucinex was bioequivalent to a standard immediate release ("IR") product, then the accused product had a Cmax equivalent to the IR product. 

The Federal Circuit agreed that, under the circumstances of this case, Adams' argument was sufficient to preclude summary judgment of noninfringement.  The court cautioned, however, that "[i]f Adams had relied on the mere fact of bioequivalence of the two sets of products (and no PK data or Cmax values, that would not be enough to survive summary judgment."  Slip Op. at 11.  Here, however, Adams presented actual PK data and Cmax values, which a fact-finder could look at when assessing equivalence between the accused product and an IR product. 

The court also addressed the meaning of the term "bioavailable" in the context of the '252 patent.  The dispute hinged on whether the phrase "fully bioavailable in the subject's stomach" meant "both release and availability in the stomach for absorption, wherever that absorption might occur." 

Perrigo argued that because "bioavailable" is commonly understood to mean absorption, thus requiring the guaifenesin to be absorbed in the stomach.  Because guaifenesin is primarily absorbed in the small intestine, this construction would preclude a finding of infringement.

The court rejected the proposed construction as inconsistent with the specification: "Although the specification never expressly defines bioavailable, it uses the term when describing the availability of the drug for absorption, not the actual absorption."  Slip Op. at 14.  The court further noted that Perrigo's construction would exclude the preferred embodiment, which "is rarely, if ever, correct and would require highly persuasive evidentiary support."

Doctrine of Equivalents
Finally, Adams argued that the district court erroneously precluded it from relying on the doctrine of equivalents with respect to a dependant claim requiring that the total amount of guaifenesin released in to the patient be at least 3500 hr*ng/mL.  The panel concluded that the use of a numerical limit did not preclude Adams from arguing that an amount of 3494.38 hr*ng/mL was equivalent to 3500 hr*ng/mL. 

Kevin Collins: An Initial Comment on King Pharmaceuticals: The Printed Matter Doctrine as a Structural Doctrine and Its Implications for Prometheus Laboratories

Kevin Collins has written a new Patently-O Patent Law Journal essay discussing the recent decision in King Pharmaceuticals. [Read the full essay]

On August 2, 2010, the Federal Circuit affirmed the district court’s summary judgment of patent invalidity in King Pharmaceuticals, Inc. v. Eon Labs, Inc. King Pharmaceuticals is most notable for its extension of the printed matter doctrine from objects claims that recite written texts as limitations to method claims that recite speech acts as limitations.

This Essay proceeds in three parts. Part I summarizes the King Pharmaceuticals opinion. Part II argues that the opinion was correctly decided, and it offers an original thesis about the role that the printed matter doctrine should play to enforce patentees’ disclosure obligations and preserve the deep structure of the Patent Act. Assuming that King Pharmaceuticals was correctly decided, Part III addresses the necessary next step in the continuing refinement of the printed matter doctrine. The Federal Circuit must explain why claims like the claim at issue in Prometheus Laboratories v. Mayo Collaborative Services are novel.

Cite as Kevin Emerson Collins, An Initial Comment on King Pharmaceuticals: The Printed Matter Doctrine as a Structural Doctrine and Its Implications for Prometheus Laboratories, 2010 Patently-O Patent L.J. 111 at /media/docs/2011/10/Collins.KingPharma.pdf.

Kevin Collins is a professor of law at Washington University in St. Louis.

Guest Post: The Great Haste and Less Milling of Beer v. United States


Guest Post: The Great Haste and Less Milling of Beer v. United States (Fed. Cir. 2010, cert. pet. pending)

By Andrew Dhuey

When patent litigators hear the term “rocket docket”, they usually think of the U.S. District Court for the Eastern District of Virginia, long-known for its dedication to accelerated justice. The term doesn’t usually call to mind the U.S. Court of Appeals for the Federal Circuit, though its docketing-to-disposition time has averaged a reasonable 9-10 months. The recent case of Beer v. United States, however, shows that it is possible to have the Federal Circuit decide your appeal on the merits and rule on your en banc hearing petition in a mere 85 days, docketing to disposition.

Beer concerns a newsworthy issue dear to the hearts of federal judges: their pay. Eight current and former federal judges seek to recover cost-of-living adjustments Congress promised federal judges in 1989, but failed to deliver in 1995-97, 1999 and 2007. While the Beer parties disagreed on whether this deprivation of COLAs was an unconstitutional diminishing of judicial pay, they all agreed that the Federal Circuit rejected this exact position in Williams v. United States (Fed. Cir. 2001). In 2002, the Supreme Court denied cert. in Williams over the dissent of Justice Breyer, joined by Justices Scalia and Kennedy.

With the issue resolved in Williams, why did these federal judges raise the same pay issue again in a 2009 U.S. Court of Federal Claims case? The answer rests not with any changes in the law, but instead with changes in the makeup of the Supreme Court. All four justices who joined the court since 2002 (Chief Justice Roberts and Justices Alito, Sotomayor and Kagan) replaced justices who voted to deny cert. in Williams. Assuming the Beer judges still have the three Williams dissenters on their side, they can win on the merits with two of the four newest justices.  

Of course, before they could even file their cert. petition, the Beer judges needed to work their way through the Claims and Federal Circuit courts. To expedite that process, the judges conceded that both the Claims court and the Federal Circuit panel were bound to follow Williams. Their purpose was to overturn Williams, which could only be done by the Federal Circuit sitting en banc, or by the Supreme Court.

On Nov. 3, 2009, thirteen days after filing their notice of appeal at the Federal Circuit, the Beer appellants filed a Petition for Initial Hearing En Banc or, in the Alternative, Motion for Summary Affirmance. Alas, the clerk’s office rejected this filing since the appellants included a copy of their trial court complaint, and that apparently is not okay. [Side note to Judge Beer, et al: none of your court clerks can hold a candle to Federal Circuit clerks when it comes to finding a way to reject a filing]. Appellants’ counsel, Christopher Landau of Kirkland & Ellis, resolved this problem the following day, and the case was then before all 12 active Federal Circuit Judges.

On Jan. 15, 2010, the court denied the petition for initial hearing en banc over the dissent of then-Chief Judge Michel, joined by Judges Lourie and Moore, and the separate dissent of Judge Newman. With that denial of the en banc petition, a three-judge panel granted the Beer appellants’ motion for summary affirmance, with a concurrence by Judge Mayer, who reiterated his previous view that Williams was wrongly decided, but that “neither Congress nor the Supreme Court has done anything in the interim that would warrant this court taking the matter up again.” The Federal Circuit had thus resolved Beer on the merits, en banc, only 85 days after docketing.  

So what, you ask? How could this possibly be of interest to you, a patent litigator? Well, you have a point – you probably won’t have occasion to stipulate at the district court or the BPIA, and on appeal, that your client is toast due to applicable, binding Federal Circuit case law. But some patent litigants are out to make a big, precedential splash (e.g. ,the ACLU in its challenges to the BRCA gene patents). Perhaps in some of these “big picture” cases, a litigant has no realistic hope on the merits, absent the overruling of a Federal Circuit panel decision. [This was not the case for the ACLU, which actually won at the district court].  Or perhaps obliterating a binding precedent would be so valuable to a litigant (e.g., a “frequent defendant”) that it would be willing to concede away weak but non-frivolous arguments on the merits in order to directly attack the harmful precedent, post haste.

Maybe you’ll never have a Beer, but in the right, highly-exceptional patent case, you might want to use the Beer strategy.

Andrew Dhuey is an appellate lawyer last seen being chased by a flower-carrying guy in a dress.

NO JOINT INFRINGEMENT despite Strategic Partnership, Joint Distribution Agreement, and Packaged Sales

PatentLawPic1052By Dennis Crouch

Golden Hour Data Systems, Inc. v. emsCharts, Inc. and Softtech (Fed. Cir. 2010)

Opinion by Judge Dyk and joined by Judge Friedman. Dissent by Judge Newman.

After trial, Judge Ward (E.D.Tx.) rejected the jury verdict of infringement and granted JMOL for the defendants — holding that no single party had infringed each element of the asserted claims.  The lower court also held the asserted patent unenforceable due to inequitable conduct during prosecution.

Joint Infringement: EMS delivers web-based medical charting.  Softtech’s software coordinates air-flight information.  The two companies formed a “strategic partnership” and signed a distribution agreement that would allow their two products to combine as a package.  The products were then sold as a package.

Patent law doctrine allows a finding of direct infringement only when a single entity is responsible for practicing each element (or step) of a claimed invention. Federal Circuit law holds that two or more entities can avoid liability for infringement so long as (1) each entity is responsible for practicing only a subset of the claimed elements and (2) no single entity exercises “control or direction” over the entire infringing process. Here, as in other Federal Circuit cases, such as Muniauction v. Thomson and BMC v. Paymentech, the Federal Circuit continued this doctrinal line — holding that the claim against emsCharts must fail because the plaintiff presented insufficient evidence for the “jury to infer control or direction.”

In BMC, Judge Rader acknowledged that strict adherence to the “control or direction” requirement highlighted an easy avenue for avoiding infringement. “This court acknowledges that the standard requiring control or  direction for a finding of joint infringement may in some circumstances allow parties to enter into arms-length agreements to avoid infringement. Nonetheless, this concern does not outweigh concerns over expanding the rules governing direct infringement.”

Dissenting from this opinion, Judge Newman argued that, despite Muniauction and BMC, the law of joint infringement does not strictly require that a single entity have control of the operation. Rather, a “collaborative effort as here . . . is not immune from infringement simply because the participating entities have a separate corporate status.”  Here, the two companies “combined their procedures into an integrated system that met all of the limitations of claims 1, 6-8, and 15-22, thus finding joint infringement and inducement to infringe these claims. The panel majority acknowledges that the defendants in collaboration infringed the claims, but without discussion overturns the jury verdict.”

Inequitable Conduct: The court also addressed inequitable conduct. Golden Hour had failed to submit an un-dated brochure that included undisclosed information that contradicted statements made by the applicant regarding a prior art AeroMed system.

Golden Hour first suggested that it had no duty to disclose the brochure because it was not clearly prior art. The Federal Circuit rejected that argument because the duty of disclosure is not limited to prior art. As stated in the MPEP, “[t]here is no requirement that the [submitted] information must be prior art references in order to be considered by the examiner.” MPEP § 609 (2008).

On materiality, the court held that the brochure was clearly material because it contradicted a statement made by the applicant in the specification. In finding the contradiction, the court looked to English grammar.  The specification stated that the AeroMed system “does not” provide comprehensive integration. According to the court, the present-tense representation indicates the applicant’s contention that the AeroMed system will not provide comprehensive integration at any time “throughout the pendency of the application.”  (DDC Says: What is Judge Dyk thinking?).

On intent to deceive the PTO, the court held that intent could be inferred if there was evidence that either of the prosecuting attorneys actually read the brochure (but if they did not read the reference then they would only be guilty of gross negligence).  Here, the court did not find evidence that the attorneys actually read the reference and therefore vacated the inequitable conduct decision for lack of intent to deceive.  (The appellate court suggests that inequitable conduct will likely be found again on remand.).

In Dissent, Judge Newman wrote:

As for materiality, I do not share the conclusion that the undated AeroMed brochure, obtained at a trade show (the Association of Aeromedical Services) a few weeks after this patent application was filed, and found not to be invalidating prior art, was so clearly and convincingly “material to patentability” that failure to provide a copy of the brochure while quoting its front page, invalidates the patent that was found valid over the entire content of the brochure. The record does not show that the brochure was published before the Golden Hour patent application was filed. The defendants provided no documentary evidence of any publication date, and the district court did not find the brochure to be prior art; their only evidence was the “uh-huh’s” of the brochure’s author, quoted at footnote 1 of the majority opinion. 

The record showed that when the brochure came into Golden Hour’s possession at the trade show, it was given to Golden Hour’s patent attorney, who referred to it in the Invention Disclosure Statement filed with the PTO, including quotation of the cover page but not the inner page. At the trial, the full brochure was in evidence, and stressed by the defendants, and the jury found that it was not invalidating. In view of the majority’s ruling that deceptive intent was not established in the district court, and the jury’s verdict of validity despite the brochure, the charge of inequitable conduct should be laid to rest.  


TheraSense v. BD: Briefs on the Merits

By Dennis Crouch

Briefing continues in the en banc appeal of TheraSense (Abbott) v. BD and Bayer. That case stems from a district court finding that the TheraSense patent was unenforceable due to inequitable conduct during prosecution of the patent. The Federal Circuit is taking the case as a vehicle for re-evaluating the judge-made-law of inequitable conduct. I have collected the majority of merits briefs filed thus far in the en banc rehearing.  Becton Dickinson & Bayer’s opposing brief is due October 8, 2010.  Amici-briefs in support of BD/Bayer are due the following week. Oral arguments are scheduled for November 9, 2010 in Washington DC.  (This post merely provides briefs. Analysis to follow.)

Court Decisions:

Party Briefs:

Amicus Brief filed in Support of TheraSense

Amici Briefs filed in Support of Neither Party

Ring Plus v. Cingular Wireless

By Jason Rantanen

Although the court ultimately reversed the determination of inequitable conduct based on a lack of intent, its discussion of materiality is significant because the misrepresentation at issue occurred in the patent itself, in the form of statements about a prior art reference.  Prosecutors may want to take special note of this opinion in crafting their Background of the Invention sections. 

Ring Plus, Inc. v. Cingular Wireless Corp. (Fed. Cir., August 6, 2010)
Panel: Lourie, Gajarsa and Moore (author)

Ring Plus is the assignee of Patent No. 7,006,608 (the '608 patent), which relates to a software based algorithm and method for generating and delivering messages over a phone line that replace or overlay a ring-back signal.

After granting summary judgment of noninfringement, the district court held a bench trial on the unenforceability of the '608 patent.  Following the bench trial, the district court concluded that the '608 patent was unenforceable due to inequitable conduct.  Ring Plus appealed both determinations, along with the denial of its motion to disqualify Cingular's counsel. 

Inequitable conduct: Materiality but no Intent
The district court's inequitable conduct determination was based on two alleged misrepresentations concerning the substance of two prior art references, Strietzel and Sleevi.  The district court found that the first misrepresentation was in the Background of the Invention section of the '608 patent, which asserted that both references proposed hardware based systems but no software to operate those systems.  Contrary to this assertion, the district court found, one of skill in the art would have understood the references to disclose software-based algorithms.1 

The panel agreed that this was a material misrepresentation.  Although neither reference explicitly disclosed software, the panel could not say that the district court clearly erred in finding that a person of ordinary skill in the art would have understood the references to disclose software-based algorithms. 

In arriving at the conclusion that the statement about the contents of the prior art constituted a misrepresentation, the panel rejected the contention that it was merely attorney argument.  The court did not address this issue in any depth, merely stating that because the statement was a misrepresentation, it "was outside the boundas of permissible attorney argument."  Slip Op. at 9.

Comment: I am a troubled by the court's cursory statement on this point because of the ambiguity it creates.  These types of sweeping assertions, made without addressing the substance of the argument or citing relevant authorities, are the kinds of things that are likely to tie attorneys and judges in knots.  Indeed, the court's quotation from Rothman is particularly perplexing, as Rothman reached the opposite conclusion on similar facts.  At a minimum, one would expect the court to explain why Rothman does not apply.

Ultimately, however, the panel concluded that Cingular had failed to present clear and convincing evidence of intent to deceive.  In arriving at this conclusion the court noted that the references were ambiguous as to operating software, and the prosecuting attorney's testimony gave rise to the inference that the applicants believed that the two references did not disclose software for operating a telephone system.  Because this inference was as reasonable as the district court's inference of deceptive intent, the district erred in its finding of deceptive intent.

Other holdings
The panel also addressed Ring Plus's challenge to the district court's construction of two claim terms, which formed the basis of the noninfringement ruling.  The court affirmed the district court's construction, relating to the sequence of steps in the '608 patent.  In addition, the court rejected Ring Plus's argument that Cingular's counsel should have been disqualified for ex parte contact with a Ring Plus director and officer.  The court concluded that there was no evidence of impropriety under Fifth Circuit law.

1The district court also found that the applicants made a misrepresentation about these references during prosecution; the panel concluded that this statement was not a misrepresentation.

Genus-Species; Doctrine of Equivalents; and Patentable Subject Matter

By Dennis Crouch

For many, the most interesting aspect of this case comes at the end in Judge Dyk’s dissent. Dyk makes the case that genes should not be patentable. 

* * * *

Intervet Inc. v. Merial Limited (Fed. Cir. 2010)

In 2006, Intervet filed a complaint against Merial — asking the DC District Court for a declaratory judgment that Intervet’s Porcine Circovirus vaccine (PCV-2) did not infringe Merial’s gene patent.  Merial’s patent claims both the isolated DNA molecule of PCV-2 and a vector that contains the DNA.  The application includes a listing of several different sequences that all fall within the PCV-2 category. 

Although Intervet also uses a PCV-2 vector. The DJ plaintiff argues that its DNA molecule is different from the one described and deposited by Merial. The district court agreed — holding that the Intervet product was only 99.7% homologous to the closest deposited sequence and therefore outside of the literal claim scope. The district court also applied prosecution history estoppel to rejected Merial’s claims of infringement under the doctrine of equivalents (DOE). On appeal, the Federal Circuit reversed on both claim construction and DOE.

Genus Not Limited to Examples: The asserted claim includes a limitation of a “PCV-2” DNA molecule. The District Court limited that term to cover only the DNA sequences that were deposited with the PTO. On appeal, the Federal Circuit rejected that construction as overly limiting. Rather, the appellate panel held that the deposited sequences serve as a representative sample of PCV-2 DNA sequences. “Sequences are representative of the scope of broader genus claims if they indicate that the patentee has invented species sufficient to constitute the genera. Here, the deposited strains are representative species of the larger ‘type II’ genus, where the genus is identified and claimed as the invention.” In describing its invention, the specification noted that the PCV-2 desposited sequences had a 96% homology and that the invention did not cover PCV-1 sequences that at most shared 76% homology with the deposited sequences.  Taking those quantitative limits from the specification, the Federal Circuit ruled that the claimed PCV-2 molecule should be construed as being “about 96% or more homologous with the … sequences disclosed in the present specification, and about 76% or less homologous with the [disclosed PCV-1] sequence.”

What is Equivalents are Surrendered by a Narrowing Amendment: An accused infringer may still be liable even though its product does not literally infringe every element of an asserted patent claim.  Under the doctrine of equivalents (DOE), a patentee may be able to provie infringement by showing that one or more elements of the accused product are equivalent to elements in the claim.  Under the limiting doctrine of prosecution history estoppel (PHE), a patentee will ordinarly be estopped from claiming DOE over a claim element that was narrowed during prosecution. (A narrowing amendment made for purposes related to patentability creates a rebuttable presumption that estoppel applies.)

Here, one of Merial’s original claims was directed to a markush group of open reading frames (ORFs) that had been described in the specification as “ORFs 1–13.”  In an initial rejection, the examiner suggested that the limitation could refer to ORFs of non-PCV-2 molecules. Although the patentee argued that the claim was clear, it still added the limitation that the claimed ORFs were PCV-2 ORFs.  The Federal Circuit held that this was a narrowing amendment substantially related to patentability. That narrowing amendment therefore created a presumption that the patentee had surrendered all equivalents that relate to non-PCV-2 ORFs. The district court erred, however, in holding that this narrowing amendment would estopp the the patentee from asserting that the claims cover a non-claimed PCV-2 ORF as an equivalent. “Such a draconian preclusion would be beyond a fair interpretation of what was surrendered. The rationale for the amendment was to narrow the claimed universe of ORFs down to those of PCV-2, and bore only a tangential relation to the question of which DNA sequences are and are not properly characterized as PCV-2.”

Dissenting-in-part, Judge Dyk discussed his argument that the claims directed toward the isolated form of a naturally occurring gene are likely unpatentable under 35 U.S.C. § 101.

[T]he isolated DNA claim raises “substantial issues of patentable subject matter under 35 U.S.C. § 101. . . . Neither the Supreme Court nor this court has directly decided the issue of the patentability of isolated DNA molecules. Although we have upheld the validity of several gene patents, none of our cases directly addresses the question of whether such patents encompass patentable subject matter under 35 U.S.C. § 101. . . .

I think that such patents do in fact raise serious questions of patentable subject matter. The Supreme Court’s recent decision in Bilski v. Kappos has reaffirmed that “laws of nature, physical phenomena, and abstract ideas” are not patentable. No. 08-964, slip op. at 5 (U.S. June 28, 2010) (quoting Diamond v. Chakrabarty, 447 U.S. 303, 309 (1980)); Funk Bros. Seed Co. v. Kalo Inoculant Co., 333 U.S. 127, 130 (1948). Just as the patentability of abstract ideas would preempt others from using ideas that are in the public domain, see Bilski, slip op. at 13, so too would allowing the patenting of naturally occurring substances preempt the use by others of substances that should be freely available to the public. Thus, “a new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter. Likewise, Einstein could not patent his celebrated law that E=mc2; nor could Newton have patented the law of gravity.” Chakrabarty, 447 U.S. at 309. These aspects are properly conceptualized as representing a public domain, “free toall men and reserved exclusively to none.” Id. (quoting Funk Bros., 333 U.S. at 130) (quotation mark omitted).

In Funk Brothers, the Court considered the patentability of a mixture of several naturally-occurring species of bacteria. 333 U.S. at 128-31. The patented product was a mixture of bacteria used in agricultural processes, enabling plants to draw nitrogen from the air and convert it for usage. The inventor discovered that certain strains of the bacteria were effective in combination with one another, and contrary to existing assump-tions, did not exert mutually inhibitive effects on each other. The Court held that the invention was not pat-entable subject matter. Id. at 131. The inventor “did not create a state of inhibition or of non-inhibition in the bacteria. Their qualities are the work of nature. Those qualities are of course not patentable.” Id. at 130. The Court furthermore noted:

The qualities of these bacteria, like the heat of the sun, electricity, or the qualities of metals, are part of the storehouse of knowledge of all men. They are manifestations of laws of nature, free to all men and reserved exclusively to none. He who discovers a hitherto unknown phenomenon of na-ture has no claim to a monopoly of it which the law recognizes. If there is to be invention from such a discovery, it must come from the applica-tion of the law of nature to a new and useful end.


In Chakrabarty, the Court considered whether a human-made microorganism is patentable subject matter under section 101. 447 U.S. at 305. The microorganism in question was a bacterium that had been genetically engineered to break down crude oil. In concluding that the man-made bacteria was patentable, the Court observed that the claim “is not to a hitherto unknown natural phenomenon, but to a nonnaturally occurring manufacture or composition of matter.” Id. at 309. The Court went on to distinguish Funk Brothers on the ground that the Chakrabarty bacterium possessed “markedly different characteristics from any found in nature. . . . His discovery is not nature’s handiwork, but his own; accordingly it is patentable subject matter under § 101.” Id. at 310 (em-phasis added).

Thus, it appears that in order for a product of nature to satisfy section 101, it must be qualitatively different from the product occurring in nature, with “markedly different characteristics from any found in nature.” It is far from clear that an “isolated” DNA sequence is qualita-tively different from the product occurring in nature such that it would pass the test laid out in Funk Brothers and Chakrabarty. The mere fact that such a DNA molecule does not occur in isolated form in nature does not, by itself, answer the question. It would be difficult to argue, for instance, that one could patent the leaves of a plant merely because the leaves do not occur in nature in their isolated form.



Gene Patents on Appeal: ACLU’s Recusal Motion

Association for Molecular Pathology (AMP) and the American Civil Liberties Union (ACLU) v. United States Patent and Trademark Office (USPTO) and Myriad Genetics (Myriad) (Fed. Cir. 2010)

In a May 2010 decision, Judge Sweet of the Southern District of New York issued an opinion that would render most gene patents invalid for failing to claim patentable subject matter under 35 U.S.C. 101.  That high-profile case is now on an appeal, and has the potential of shifting US patent law both by its in-court and out-of-court impact.

Even before filing a substantive brief on the merits, the declaratory judgment plaintiffs (AMP & ACLU) filed a motion asking that Chief Judge Rader recuse himself from potentially hearing the decision. AMP argues that the Chief’s public statements regarding this case “have created an appearance of partiality that calls into question his ability to engage in impartial legal analysis.”

Notably, while attending a BIO meeting, Judge Rader reportedly responded to a comment by Professor Whealan (and former Rader clerk) that there are no real “legal standards for making [a Section 101] decision. . . [U]sing Section 101 to say that the subject matter is unpatentable is so blunt a tool that there is no neutral step to [draw] a line here [between what is and is not patentable].”  In Judge Rader’s construct, the lack of a clear legal standard means that the decision will then be based on “politics. It’s what you believe in your soul, but it isn’t the law.”  In another conference (this time at Fordham Law School), AMP’s attorney Dan Ravicher was speaking and Chief Judge Rader asked Ravicher a question “hinting at disagreement” with Ravicher’s position.  In particular, the Ravicher-Rader colloquy was quoted as follows:

Ravicher (pointing to a bottle of water): "Was that [purification] sufficient intervention between what God gave us … and what man created to merit a patent?"

Chief Judge Rader: "How many people have died of water pollution over the course of human events? Probably billions."

Two responses to the ACLU motion have been filed. 

First, Myriad responded that the cited statements by Chief Judge Rader “do not even suggest how Chief Judge Rader might vote, were he a member of the panel assigned to decide this case.”

The second filing is by the Federal Circuit Bar Association (FCBA) as amicus. The FCBA argues strongly that Judges should be encouraged to participate in educational conferences such as the BIO meeting and Fordham Law School.  The FCBA makes the important point that “Just as it is important that judges recuse themselves when the rules require it, it is equally important that judges refuse to recuse themselves where the rules do not require it.”  Granting recusal on the thin-evidence presented here would have the two primary effects of (1) discouraging sitting Federal Circuit judges from participating in public conversations and (2) encourage more strategic recusal motions.  The FCBA motion was a joint effort by former Deputy Solicitor General Thomas Hungar (Gibson Dunn) and the oft-paired team of Ed Reines & Amber Rovner (Weil Gotshal).

This particular motion may never be decided. Since the panel has not yet been assigned for this appeal, the CAFC has refrained from deciding the motion. In a letter to AMP, the court indicated that “[i]n the event that Judge Rader is assigned, the motion will be transmitted to him.” 


Divorce and Patents

Enovsys v. Nextel (Fed. Cir. 2010)

Mundi Fomukong is a co-inventor of the patents-in-suit. At the time of the invention, Fomukong was married to Fonda Whitfield. Sometime after the first patents issued, Fomukong and Witfield divorced. Later, the second patent issued; Fomukong formed Enovsys; and he (along with his co-inventor) assigned their rights to the new company. Later, when Enovsys sued Sprint-Nextel, the defendant challenged the case on standing. Sprint's argument is based on the rule that any patent infringement actions must be brought jointly by all co-owners of the patent. Specifically, Sprint argued that Ms. Whitfield retained an interest in the patent rights even after the divorce and, without Ms. Whitfield's support, Enovsys lacked standing. (Ms. Whitfield assigned her rights to Sprint.)

In the US, patent ownership rights are primarily controlled by state laws. At times, patent attorneys are called to understand their local laws of contracts, employment, inheritance, and (here) divorce. Thus, in deciding this case, the court looked first to the law of California — the site of the marriage, invention, and divorce.

California is a "community property" state and “all assets acquired during a marriage are presumptively community property.” In their divorce filings, however, Fomukong and Whitfield checked the box next to the statement that “We have no community assets or liabilities.” Without citing specific California law, the Federal Circuit held that that the final divorce decree coupled with this box-checking stripped Whitfield of her community property rights in the patent. "[A]lthough the final divorce decree was silent as to particular property, it nevertheless adjudicated the parties’ rights with respect to that property because it was based on an uncontested complaint which alleged that there was no community property."

With the issue of ownership settled, the court then affirmed the lower court's claim construction and infringement verdict.


Ignoring Non-Patentable Elements While Judging Novelty

PatentLawPic1046By Dennis Crouch

The Federal Circuit offers some clues to its post-Bilski patentable-subject-matter jurisprudence, but leaves that fight for another day.  Instead, the court held the claims anticipated by explicitly ignoring novel claim elements.

* * * * *

King Pharmaceuticals, Inc. v. Eon Labs, Inc. and Elan Pharmaceuticals, Inc. (Fed. Cir. 2010)

King’s patent claims a method of increasing oral bioavailability of the muscle relaxant metaxalone by putting metaxalone in food eaten by the patient. Claim 21 includes a step of “informing the patient that the administration [of the drug with food] results in an increase [in absorption].  This step likely has two benefits: (1) increasing patient compliance with the drug regimen and (2) taking advantage of any placebo effect that may exist.  The drug metaxalone itself was already a known muscle relaxant well prior to King’s 2001 application date.

Patenting Methods of Treatment: The district court held claim 21 invalid under 35 U.S.C. 101 based on the Federal Circuit’s machine-or-transformation test from Bilski. On appeal, the Federal Circuit rejected the lower court analysis — noting that when examined “as a whole”, the claim requires treatment and “methods of treatments ‘are always transformative when a defined group of drugs is administered to the body to ameliorate the effects of an undesired condition.’” (quoting Prometheus Labs., Inc. v. Mayo Collaborative Serv., 581 F.3d 1336, 1346 (Fed. Cir. 2009), cert. granted and vacated, 78 U.S.L.W. 3254 (U.S. June 29, 2010)).

Although the appellate panel rejected the lower court’s Section 101 analysis, it stopped short of providing any positive position on the patentability of medical treatment methods — presumably saving that battle for the pending remands of Prometheus and Classen

Instead, the appellate court held that a Section 101 decision was not necessary because the claims of interest are anticipated under Section 102.

Ignoring Non-Patentable Elements: Here, the novelty question is interesting because the “informing” step was not specifically identified in the prior art. On appeal, the Federal Circuit held that claiming a step of “informing someone about the existence of an inherent property” of a method cannot render the claim patentable. “[I]n light of our holding that the method of taking metaxalone with food to increase the drug’s bioavailability, as recited in claim 1, is not patentable, it readily follows that claim 21, which recites the same method with the sole additional step of informing the patient about this increase in bioavailability, is not patentable.” 

In its decision, the court ties its case to the precedential foundation of “printed matter” cases that have barred the patentability of known products by the inclusion of printed matter describing the product.

In some ways, this decision may be seen as reviving the suggestion found in the now vacated 2007 In re Comiskey decision. There, the court suggested that, during nonobviousness analysis, any portion of an invention that constitutes nonstatutory subject matter will be considered de facto obvious.

Panel: Judges Bryson, Gajarsa, and Prost. Authored by Judge Gajarsa. 



Sun Pharmaceuticals v. Eli Lilly: obviousness-type double patenting in the pharmaceutical context

Sun Pharmaceutical Industries, Ltd. v. Eli Lilly and Company (Fed. Cir. July 28, 2010)

By Jason Rantanen

Double-patenting issues arise when two commonly owned applications cover the same or similar inventions.  The issues in this appeal revolved around an earlier patent claiming a composition of matter and describing a method for using that composition, and a later patent claiming that method of use. 

Both of the patents in this case, Patent No. 4,808,614 (the '614 patent) and Patent No. 5,464,826 (the '826 patent) relate to gemcitabine, the active ingredient of Lilly's Gemzar® product.  The '614 patent claims both gemcitabine itself, as well as a method of using it to treat viral infections.  In addition, the '614 patent's specification discloses using gemcitabine to treat cancer.  The '826 patent claims a method of treating cancer comprising administering a therapeutically effective amount of gemcitabine.  The difference was important: the '614 patent expired on May 15, 2010, while the '826 patent does not expire until November 7, 2012.

Note: The applications leading to both the '614 and '826 patents were filed on the same day, December 4, 1984.  The '614 was a continuation-in-part of application No. 473,883 ("the '883 application"), which did not disclose using gemcitabine to treat cancer.  That information was added as part of the continuation-in-part. 

After filing an Abbreviated New Drug Application ("ANDA") for a generic version of Gemzar®, Sun Pharmaceuticals, sought a declaratory ruling that the '826 patent was invalid and not infringed.  Lilly counterclaimed for infringement of the '826 and '614 patents.  The '614 patent was not at issue in this appeal.

Obviousness-type double patenting applies
Applicants are barred from obtaining multiple patents covering the same invention by the doctrine of double patenting.  There are two types of double patenting: statutory double patenting, which prohibits a later patent from covering the identical invention, and obviousness-type double patenting, which prevents a later patent from covering a slight variation of an earlier patented invention.

On appeal, the panel agreed with the district court and Sun that the latter type of double patenting occurred here, thus invalidating the asserted claims of the '826.  The basis for the court's decision were two prior opinions, Geneva v. GlaxoSmithKline, 349 F.3d 1373, and Pfizer v. Teva, 518 F.3d 1353.  In Geneva, the earlier patent claimed a compound and the specification disclosed its effectiveness for inhibiting beta-lactamase.  The later patent claimed a method of using the compound to affect beta-lactamase inhibition.  Similarly, in Pfizer, the earlier patent claimed several compounds and the specification disclosed their use in treating inflamation; the later patent claimed a method of using these compounds for treating inflammation.  In both cases, the court ruled that the claims were not "patentably distinct," and thus the latter claims were invalid for obviousness-type double patenting.  

While Lilly argued that Geneva and Pfizer did not apply because "the specification of the earlier patent disclosed a single use for the claimed compound, which was an essential part of the patented invention and thus necessary to patentability," Slip Op. at 8, the court rejected that argument for two reasons.  First, the court disagreed that the specification in Pfizer disclosed more than one utility for the claimed compound.  In addition, the court read the rule of Pfizer as simply that "obviousness-type double patenting encompasses any use for a compound that is disclosed in the specification of an earlier patent claiming the compound and is later claimed as a method of using that compound.  Pfizer never implies that its reasoning depends in any way on the number of uses disclosed in the specification of the earlier patent."  Slip Op. at 10. 

The court also rejected Lilly's argument that the specification of an earlier application should have been consulted, as opposed to the specification of the '614 patent.  Drawing upon its claim construction precedent, the court noted that the specification is relevant to determining the coverage of the claims, which is at the heart of the obviousness-type double patenting analysis.  The court further noted that "consulting the specification of the issued patent, as opposed to an earlier version, is consistent with the policy behind double patenting," which rests "on the fact that a patent has been issued and later issuances of a second patent will continue protection, beyond the date of expiration of the first patent of the same invention or an obvious variation thereof."  Slip Op. at 14-15.

Becton, Dickinson and Co. v. Tyco Healthcare Group (Fed. Cir. 2010)

Tyco appealed a jury verdict that its safety needles infringed BD’s US Patent No. 5,348,544.  The claims require a “spring means” that is “connected to said hinged arm” and is designed “for urging said guard along said needle cannula.” 

On appeal, the Federal Circuit reversed the infringement decision based on claim construction — holding that as a matter of English-language-logic, the claims require a spring and hinged arm that are structurally distinct.

The unequivocal language of the asserted claims . . . requires a spring means that is separate from the hinged arm. . . . Where a claim lists elements separately, “the clear implication of the claim language” is that those elements are “distinct component[s]” of the patented invention. (Quoting Gaus v. Conair Corp., 363 F.3d 1284, 1288 (Fed. Cir. 2004)). . .  There is nothing in the asserted claims to suggest that the hinged arm and the spring means can be the same structure.

If the hinged arm and the spring means are one and the same, then the hinged arm must be “connected to” itself and must “extend between” itself and a mounting means, a physical impossibility. A claim construction that renders asserted claims facially nonsensical “cannot be correct.”

Because the hinged arm of the Tyco needles performed the spring function themselves (as opposed to having a separate spring), the court ruled that those needles could not infringe.

In dissent, Judge Gajarsa provides a de-construction of the majority opinion — writing that:

The majority avoids the critical issue upon which this decision turns; i.e., whether 35 U.S.C. § 112, ¶ 6 governs the claim construction of the “spring means” limitation. In a brief footnote, the majority sweeps and brushes aside the means-plus-function analysis as unnecessary in light of the “plain language of the claims.” Without having analyzed the scope of the claims, the majority somehow concludes that the claim language covers only devices having separate “spring means” and “hinged arm” structures. Then applying this simplistic claim construction to analyze the sufficiency of the evidence, the majority improperly overturns the jury’s verdict finding infringement.


Wyers v. Master Lock

Is "obviousness" a question of law or fact?  The rote answer is that it's both: it's a question of law based on underlying findings of fact.  Drawing that line, however, can be tricky, especially when the jury issues a general verdict.  In addition to addressing this issue, the case discussed below is also noteworthy due to its commentary on KSR on the subject of  motivation to combine. 

Wyers v. Master Lock Co.
(Fed. Cir. July 22, 2010)
Wyers involved three patents relating to trailer hitch locks.  Trailer hitch locks are mechanisms used to secure trailers to towing vehicles.  It was undisputed that the prior art disclosed the use of dumbbell-shaped locks for this purpose, so the case turned on the the patentee's modifications to these types of locks.  The following images illustrate the prior art:

Wyers 1 Wyers 2

Wyers' patents claimed dumbbell-shaped locks with two additional elements: a series of sleeves that could be placed over the center section (the "shank") in order to increase its diameter, and an external seal designed to keep dirt out of the locking mechanism.  The only issue before the jury was whether it was obvious to add these two elements to the prior art locks.

The jury concluded that it was not, and issued a general verdict of nonobviousness. After the district court denied Master Lock's motion for Judgment as a Matter of Law, Master Lock appealed. 

Opinion of the Court
Drawing heavily on KSR, the Federal Circuit concluded that the patents were obvious as a matter of law.  The court considered each of the factual questions before it: whether the art was analogous, whether there was sufficient motivation to combine the reference, and the secondary considerations of nonobvious, and concluded that none favored the patentee.

In reaching this conclusion, the Federal Circuit gave no deference to the jury.  On each issue of fact, the panel found that no evidence supported nonobviousness.  For example, when addressing the issue of whether the prior art was analogous, the court reasoned that it was "clearly within the same field of endeavor as the sleeve patents," and was pertinent as a matter of law.

Particularly interesting, however, were the panel's views on motivation to combine.  While recognizing this as an important aspect of the obviousness inquiry, the panel applied the "common sense" approach outlined in KSR:

"We conclude that it was a matter of common sense to combine the Down patent with the prior art barbell locks in order to arrive at the invention claimed in the ’115 and ’426 patents, and that one of ordinary skill in the art would have had a reasonable expectation of success in doing so."

Slip Op. at 23. Furthermore, "where all the limitations of the patent were present in the prior art references, and the invention was addressed to a 'known problem,' 'KSR … compels the grant of summary judgment ofobviousness.'"  Id. at 17.  Such an approach is particularly appropriate when the technology is "easily understandable." 

Finally, on the issue of secondary considerations, the court concluded that, even if Wyers had established the requisite nexus, it would have been insufficient:

Moreover, secondary considerations of nonobviousness—considered here by the district court—simply cannot overcome a strong prima facie case of obviousness.

Slip Op. at 28

Judge Linn concurred with the opinion, but wrote separately to warn parties of the dangers of general verdicts.  He noted that although the law permits general verdicts, verdicts involving special interrogatories are encouraged in the obviousness context due to the mixed question of law and fact.  He further noted that, while the court must presume that the jury resolved the underlying factual disputes in favor of the verdict winner when there are no special interrogatories,

"[b]ecause there is no way to determine from a general verdict on obviousness the specific findings of fact made by a jury on the factual questions underlying its verdict, the court in examining the first part of the obviousness question is left to infer whether substantial evidence existed from which the jury could have made the factual findings necessary to support the verdict. Here, the majority examined the record and after considering the factual inferences concluded that support was lacking and that the claims at issue would have been obvious as a matter of law."

Slip op., concurrence at 4-5.  In other words, when a general verdict is give, the Federal Circuit has to attempt to reconstruct the underlying findings of fact.  Here, it could not discern anything that might reasonably have been in dispute, and thus judgment as a matter of law was appropriate. 

Federal Circuit Review of Patent Term Extensions

By Jason Rantanen

During the summer, the Federal Circuit is a relatively quiet place.  The judges often take their non-sitting months during this time, and the pace of opinions tends to drop.  Thus, for the next few weeks, I'll mostly be posting summaries of cases that issued this past spring and early summer.  The two cases discussed below deal with a relatively minor — but still important issue in the pharmaceutical and medical device context: patent term extensions based on extensive regulatory review periods. 

Ortho-McNeil Pharmaceutical, Inc. v. Lupin Pharmaceuticals, Inc. (Fed. Cir.  May 10, 2010)
Photocure ASA v. Kappos
(Fed. Cir. May 10, 2010)

35 U.S.C. §156 allows a patentee to obtains a term extension if the patent covers a product that has been subject to a regulatory review period before it can be marketed or used.  Pharmaceuticals and medical devices are subject to such a review period, and new drug products in particular often involve a lengthy application and testing process.  The initial determination as to whether a patent term extension should be granted is made by the USPTO, in consultation with the FDA.  That decision is subject to review or challenge in district court proceedings.

One of the key issues in determining whether a patent term extension is warranted for a drug is whether it is the first time regulatory approval has been granted for this particular drug product, a determination that turns on whether or not the "active ingredient" had previously been approved by the FDA.  Ortho-McNeil and Photocure, both authored by Judge Newman and issued on the same day, provide an interesting contrast on this issue. 

Ortho-McNeil v. Lupin
In Ortho-McNeil, the extension issue arose in the context of an injunction entered against Lupin Pharmaceuticals prohibiting it from making, using, selling, etc. a drug product covered by U.S. Patent No. 5,053,407 (the '407 patent) during the extension period.  In that case, the district court affirmed the PTO's determination that an enantiomer was a different drug product then its racemate. In doing so, the district court noted that the PTO's determination should be afforded great deference.

Note: Enantiomers are molecules that are mirror images of one another.  Due to their different orientation, they have different properties.  A racemate is a composition consisting of equal parts of the two enantiomers.  The '407 patent covered a substantially purified form of one of the two enantiomers (levofloxacin) in the racemate ofloxacin.  There was no dispute that levofloxacin was separately patentable from ofloxacin.

On appeal, the Federal Circuit agreed with the district court, concluding that there was no basis for challenging the established FDA and PTO practices of treating enantiomers as different drug products and rejecting Lupin's legislative intent argument.

Photocure v. Kapos
Photocure involved a contrary determination by the PTO: that the drug product at issue was not a different "active ingredient," and thus the patentee was not entitled to an extension.  In Photocure, the product at issue ("MAL") was a methyl ester of a compound ("ALA") that had previously been approved for the same therapeutic use.  While the FDA treated MAL as a new drug, requiring a full approval process, the PTO rejected the extension based on its conclusion that § 156(f)(2) does not mean the product approved by the FDA, but rather the "active moiety," which it concluded was the same in both MAL and ALA.

Both the district court and Federal Circuit disagreed.  In rejecting the PTO's interpretation of 156(f)(2), the Federal Circuit reasoned that § 156 focuses on the product that is subject to approval by the FDA, not the underlying pharmacological mechanism. Furthermore, Skidmore and Chevron deference standards did not apply because the statute was not unambiguous and the PTO's interpretation was neither persuasive nor consistent. 

Note: although not the primary focus of the opinon, the panel also concluded that the PTO was wrong even under its  "active moiety" interpretation as the biological properties of ALA and MAL are indisputably different.

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In addition to the issues discussed above, the scope of the injunction in Ortho-McNeil is worth noting.  Although the extension authorized by 35 U.S.C. § 156 covers the "selling" or "using" of the product covered by the patent, the district court enjoined Lupin from engaging in any of the traditional forms of direct infringement, including "making" or "importing."  Despite the literal language of §156, the Federal Circuit affirmed the scope of this injunction because there are no non-pharmaceutical "uses" of the drug product, a point that Lupin apparently conceded.  Although as a practical matter this distinction may be of little value, as pharmaceutical companies often have production facilities located outside the United States, it is something to consider when seeking or opposing litigation under § 156.