By Kevin E. Noonan --
The Federal Circuit reversed a finding of non-obviousness in a Patent Trial and Appeal Board decision in an inter partes review, in an opinion handed down Monday in E. I. du Pont de Nemours & Co. v. Synvina C.V.
The patent was directed to methods for oxidizing 5-hydroxymethylfurfural or derivatives thereof under reaction conditions specified by the claims ("temperature, pressure, catalyst, and solvent"), to form 2,5-furan dicarboxylic acid ("FDCA"). FDCA can be produced from sugars and thus is considered by the Department of Energy to be a "green" or environmentally beneficial precursor to other materials.
The instituted petition challenged claims 1-5 and 7-9 of U.S. Patent No. 8,865,921 as being invalid for obviousness; claim 1 is representative:
1. A method for the preparation of 2,5-furan di-carboxylic acid comprising the step of contacting a feed comprising a compound selected from the group consisting of 5-hydroxymethylfurfural ("HMF"), an ester of 5-hydroxymethylfurfural, 5-methylfurfural, 5-(chloromethyl)furfural, 5-methylfuroic acid, 5-(chloromethyl)furoic acid, 2,5-dimethylfuran and a mixture of two or more of these compounds with an oxygen-containing gas, in the presence of an oxidation catalyst comprising both Co and Mn, and further a source of bromine, at a temperature between 140° C. and 200° C. at an oxygen partial pressure of 1 to 10 bar, wherein a solvent or solvent mixture comprising acetic acid or acetic acid and water mixtures is present.
(Where the italicized portion of the claim are the terms considered by the PTAB and the Federal Circuit.) The opinion enumerated the four conditions recited in the claims (and that were the basis for its opinion) as:
(1) a temperature between 140°C and 200°C ("higher than 140° C"; "at least 140° C., preferably from 140 and 200° C., most preferably between 160 and 190° C," albeit noting that "[t]emperatures higher than 180°C. may lead to decarboxylation and to other degradation products.")
(2) an oxygen partial pressure ("PO2") of 1 to 10 bar ("The pressure is determined by the solvent (e.g., acetic acid) pressure at a certain temperature. The pressure of the reaction mixture is preferably selected such that the solvent is mainly in the liquid phase"; "In the case of continuously feeding and removing the oxidant gas to and from the reactor, the oxygen partial pressure will suitably be between 1 and 30 bar or more preferably between 1 and 10 bar.");
(3) a solvent comprising acetic acid ("[t]he most preferred solvent is acetic acid"); and
(4) a catalyst comprising cobalt ("Co"), manganese ("Mn"), and bromine ("Br") ("based on both cobalt and manganese and suitably containing a source of bromine"; "The catalyst may also contain 'one or more additional metals, in particular [zirconium] and/or [cerium].'").
The opinion also consulted the specification to further explicate the meaning of these terms, as shown in the parenthetical annotations above. According to the opinion, "the specification states that the inventors 'surprisingly' achieved high yields of FDCA," which were asserted during the IPR proceedings to constitute one of the "secondary considerations" (aka objective indicia) of non-obviousness.
The IPR was instituted over the following prior art:
Obviousness claims 1–5, over the disclosure of International Publication WO 01/72732, either alone or in combination with Inventor's Certificate RU-448177 and U.S. Patent Application Publication 2008/0103318
Obviousness, claims 7-9, over the disclosure of International Publication WO 01/72732, in combination with "Applicants Admitted Prior Art," or Jaroslaw Lewkowski, Synthesis, Chemistry and Applications of 5-Hydroxymethylfurfural and Its Derivatives, ARKIVOC 17 (2001) and/or Shigeru Oae, A Study of the Acid Dissociation of Furan- and Thiophenedicarboxylic Acids and of the Alkaline Hydrolysis of Their Methyl Esters, 38(8) Soc. Jpn. 1247 (1965)
All of the cited references disclosed methods for producing oxidized HMF or a derivative under differing conditions, which overlapped the claimed conditions of temperature, pressure, solvent and catalyst. Depending on the reference, yields varied from 14% to 58.8%. Paradoxically, the prior art reference having the best yield (98%) specified water as solvent and using a platinum catalyst. The opinion set forth a table comparing the various reaction conditions.
"The two additional references, Lewkowski and Oae, are relevant to the FDCA esterification claims 7–9. Consistent with the '921 patent's acknowledgment that esterification of FDCA was known at the time of the invention, '921 patent col. 5 l. 42, Lewkowski and Oae both disclosed esterifying FDCA."
At final hearing, DuPont argued that "a burden-shifting framework" applied to the question of obviousness. The Board rejected this contention under In re Magnum Oil Tools International, Ltd., 829 F.3d 1364, 1375 (Fed. Cir. 2016), and Dynamic Drinkware, LLC v. National Graphics, Inc., 800 F.3d 1375, 1378 (Fed. Cir. 2015), which the PTAB held foreclosed this burden shift in an IPR. This was the error that caused the Federal Circuit to reverse the Board's judgment. The Board based its non-obviousness decision on its recognition that while the prior art disclosed performing the claimed reaction (oxidizing HMF or derivatives to FDCA), "none of the references relied upon by Petitioners expressly taught a process in which HMF or its derivatives were oxidized to FDCA using a Co/Mn/Br catalyst at a reaction temperature of between 140°C and 200°C while also maintaining the [PO2] between 1 and 10 bar," nor that adjusting the temperature and pressure variables to be within the claimed range would be a matter of mere routine experimentation.
The Board also considered the objective indicia of non-obviousness is arriving at its conclusion, but found that evidence to be "less probative in supporting a conclusion of non-obviousness" particularly with regard to unexpectedly high yields.
The Federal Circuit reversed, in an opinion by Judge Lourie, joined by Judges O'Malley and Chen. The panel first addressed the standing issue raised by Patent Owner, holding that Petitioner DuPont had standing. Analogizing this circumstance with a declaratory judgment plaintiff, the panel held that there need not be "a specific threat of infringement litigation by the patentee" but rather merely "a controversy 'of sufficient immediacy and reality' to warrant the requested judicial relief. Id. (citing MedImmune, Inc. v. Genentech, Inc., 549U.S. 118, 127 (2007)). The circumstances asserted by DuPont were enough to satisfy this standard:
(1) DuPont has built a demonstration plant to produce FDCA and an FDCA ester ("FDME"), and the plant is capable of operating under conditions within the claimed ranges of the '921 patent; (2) Synvina is a competitor that alleged before the Board that Archer-Daniels-Midland Company's ("ADM") processes for producing FDCA were "embraced by the claims in the '921 patent," and (3) Synvina rejected DuPont's request for a covenant not to sue.
(Interestingly, the evidence adduced by DuPont in support of standing establishes their intent to willfully infringe should the panel not decide that the PTAB erred in not finding the '921 patent to be invalid, although the panel was careful to state in a footnote that "we make no judgment on whether DuPont has infringed or is infringing the '921 patent.")
Turning to the merits, the opinion states it is applying the "old" legal principle that "where the general conditions of a claim are disclosed in the prior art, it is not inventive to discover the optimum or workable ranges by routine experimentation," citing In re Aller, 220 F.2d 454, 456 (CCPA 1955); In re Geisler, 116 F.3d 1465, 1469–70 (Fed. Cir. 1997); and In re Woodruff, 919 F.2d 1575, 1578 (Fed. Cir. 1990). Said another way, "[a] prima facie case of obviousness typically exists when the ranges of a claimed composition overlap the ranges disclosed in the prior art," citing In re Peterson, 315 F.3d 1325, 1329 (Fed. Cir. 2003), and "such overlap creates a presumption of obviousness," citing Galderma Labs., L.P. v. Tolmar, Inc., 737 F.3d 731, 737–38 (Fed. Cir. 2013); Ormco Corp. v. Align Technology, Inc., 463 F.3d 1299, 1311 (Fed. Cir. 2006); and Iron Grip Barbell Co. v. USA Sports, Inc., 392 F.3d 1317, 1322 (Fed. Cir. 2004). The presumption can be rebutted, according to the opinion, in the usual manner: by establishing one of the secondary considerations (aka objective indicia) of non-obviousness (unexpected results, typically by identifying a "critical" range of one of the recited parameters; or teaching away). Alternatively, "a change to a parameter may be patentable if the parameter was not recognized as 'result-effective,'" citing In re Applied Materials, Inc., 692 F.3d 1289, 1295 (Fed. Cir. 2012), relying on In re Antonie, 559 F.2d 618, 620 (CCPA 1977)). Finally, prior art that recites very broad ranges of variables "may not invite routine optimization."
Here, the Federal Circuit held that the presumption of obviousness applied, and the Patent Owner had not adequately rebutted it. Responding to the parties' arguments, the panel agreed with Petitioner that "the Board erred in concluding that the type of burden-shifting framework consistently applied in our overlapping range cases was implicitly foreclosed by subsequent cases not addressing this framework." Specifically:
"[W]here there is a range disclosed in the prior art, and the claimed invention falls within that range, the burden of production falls upon the patentee to come forward with evidence" of teaching away, unexpected results, or other pertinent evidence of nonobviousness. Galderma, 737 F.3d at 738; see Allergan, Inc. v. Sandoz Inc., 796 F.3d 1293, 1304–05 (Fed. Cir. 2015) (citing Galderma, 737 F.3d at 737–38); Ormco, 463 F.3d at 1311 ("Where a claimed range overlaps with a range disclosed in the prior art, there is a presumption of obviousness. The presumption can be rebutted if it can be shown that the prior art teaches away from the claimed range, or the claimed range produces new and unexpected results.")
These cases applied this evidentiary standard in the context of district court litigation. The Federal Circuit held that there was no basis for the same standard not to be applied in IPR proceedings, and held the Board had erred in not considering this case law and instead relying on recent cases (In re Magnum Oil Tools International, Ltd., 829 F.3d 1364 (Fed. Cir. 2016), and Dynamic Drinkware, LLC v. National Graphics, Inc., 800 F.3d 1375 (Fed. Cir. 2015)) that were inapposite to the question (albeit involving IPRs). The panel cautioned that broad statements in their case law "must be interpreted in context" and that in overlapping range cases, "a patent challenger would have every incentive to point out the existence of an overlapping range, and virtually none to differentiate the claimed range from what was disclosed in the prior art." That latter task is left to Patent Owner, and general principles of burden shifting must accommodate this reality.
Further, the panel agreed with Petitioner that the Board erred in holding that the PO2 and temperature variables were not "result-effective variables." The opinion found error in the Board not applying the proper legal standard ("[a]lthough the Board correctly articulated the basic standard for result-effective variables , it did not follow it"): "a person of ordinary skill would not always be motivated to optimize a parameter "if there is no evidence in the record that the prior art recognized that [that] particular parameter affected the result," citing In re Antonie. In that case, the changes an inventor made in such a parameter could result in a non-obvious advance in the art, and provide an exception to the rule that "the discovery of an optimum value of a variable in a known process is normally obvious," citing In re Aller. Here, according to the opinion, the Board imposed the improper burden on Petitioner "to prove that the disclosures in the prior art 'necessarily required' the variable to be within the claimed range, or that the variables 'predictably affected FDCA yields.'" All that DuPont was required to show to support its obviousness contention was that the prior art recognized, either expressly or impliedly, that what was claimed (a method of oxidizing HMF and related molecules) was affected by the reaction temperature and PO2. The references supported DuPont's argument that the art recognized the dependence of the oxidation reaction on these parameters and thus these were "results-effective variables." Accordingly, mere optimization of them rendered the claimed methods prima facie obvious. Applying this proper legal standard to each of the challenged claims, the panel arrived at the conclusion that each claim was obvious. Importantly, the panel further refined its understanding of the Board's error insofar as "the Board did not consider the 'normal desire of scientists or artisans to improve upon what is already generally known,' which 'provides the motivation to determine where in a disclosed set of . . . ranges is the optimum combination,'" citing In re Peterson.
Finally, the Federal Circuit held that the Board's refusal to credit the Patent Owner's evidence of secondary considerations was supported by substantial evidence and thus not subject to being second guessed by the Court. With regard to long-felt need, the panel cited in support disclosure in the '921 of laboratory-scale, rather than industrial-scale, improvement in yields. Should this become the standard, of course, it is unlikely that long-felt need would ever be sufficient as a persuasive objective index of non-obviousness.
The Court's conclusion was summary:
At bottom, this case involves a strong case of obviousness based on very close prior art and weak evidence of nonobviousness. We conclude that the Board therefore erred in not concluding that claims 1–5 would have been obvious at the time of the claimed invention.
The Court invalidated claims 7-9 using the same legal standard as applied to the art cited against claims 1-5 and the additional Lewkowski and Oae references, and that Synvina did not argue that claims 7-9 were separately patentable from claims 1-5.
This decision illustrates an application (in the chemical arts) of the principle regarding claims encompassing an incremental change to a known process that this Court (and undoubtedly, the Supreme Court; see KSR Int’l. v. Teleflex) considers undeserving of patent protection, because it falls within the art's ordinary skill to optimize a known process by varying parameters known to be important to how the process achieves a desired goal. As such there is nothing particularly remarkable about this case, except (as with all cases) to test whether the consequence of the application of this principle arrives at an outcome consistent with the purposes of patent law and thus affirm the correctness of the principle. The extent to which this depends on the "eye of the beholder" is apparent and perhaps unavoidable. But it is a proper exercise of the Federal Circuit's mandate, both to establish clear and (to the extent possible) consistent standards for patent law and provide a judicial check on the USPTO. In the IPR era, this latter function is more important than ever, nicely illustrated by the decision in this case.
E. I. du Pont de Nemours & Co. v. Synvina C.V. (Fed. Cir. 2018)
Panel: Circuit Judges Lourie, O'Malley, and Chen
Opinion by Circuit Judge Lourie