By Suresh Pillai --
Last week, the Federal Circuit affirmed a determination by the International Trade Commission ("ITC") that: (1) the asserted claims of U.S. Patent Nos. 5,827,698 and 6,040,160 were invalid for failure to comply with the best mode requirement, and (2) the '698 patent was unenforceable due to inequitable conduct. Both the '698 patent and the '160 patent are directed to improved methods of producing L-lysine through the use of E. coli bacteria that have been genetically engineered specifically for the purpose of producing lysine at levels far above those found in nature. Specifically, the patents are directed to methods that disrupt the natural feedback inhibition and lysine degradation pathways within E. coli. Claim 15 of the '698 patent, rewritten to include the claim from which it depends, recites:
15. A method for producing L-lysine, comprising:
(a) cultivating an isolated microorganism belonging to the genus Escherichia, wherein the microorganism containing a [mutant lysine decarboxylase] in a liquid medium, thereby producing the L-lysine and accumulating the L-lysine in the liquid medium, and
(b) collecting the L-lysine produced and accumulated in step (a), wherein the microorganism belongs to the species Escherichia coli.
Asserted claim 15 of the '160 patent, rewritten to include the claim from which it depends, recites:
15. A method of producing L-lysine, comprising: cultivating a bacterium belonging [to] the genus Escherichia which is transformed with a DNA coding for a dihydrodipicolinate synthase originating from a bacterium belonging to the genus Escherichia and having mutation to desensitize feedback inhibition of L-lysine, wherein the mutation is selected from the group consisting of [a mutation to replace the alanine residue at the 81st position and/or a mutation to replace the histidine residue at the 118th position] in a suitable culture medium, producing and accumulating L-lysine in the culture thereof, and collecting L-lysine from the culture.
The panel opinion notes that that both patents disclose certain E. coli strains for practicing the claimed inventions. In contrast to the specification of the '698 patent, however, the inventors actually induced two other undisclosed additional genetic alterations before the addition of mutant Idc. Similarly, in the '160 patent specification, the inventors described two host strains (B-399 and W3110 (tyrA)); however, the inventors neglected to include strain AE-70, a strain characterized by the inventors prior to the filing of the priority Japanese application as "their best lysine producer."
On April 25, 2006, Ajinomoto filed its complaint with the ITC, alleging that Global Bio-Chem Technology Group Company, Ltd., Chanchun Dacheng Bio-Chem Engineering Development Co., Ltd., Chanchun Baocheng Bio-Chem Development Co., Ltd., Chanchun Dahe Bio-Technology Development Co., Ltd., and Bio-Chem Technology (HK) Limited ("defendants") violated section 337 of the Tariff Act of 1930 as amended, 19 U.S.C. § 1337, through defendants' importation and sale of certain lysine feed products made according to the disclosed methods of the '160 and '698 patents. The ITC launched an investigation. Before trial, defendants admitted infringement of the patents-in-suit. However, the ITC ALJ's ruling found that the patents were invalid for multiple violations of 35 U.S.C. § 112's best mode requirement. The ALJ also concluded that both patents were unenforceable due to inequitable conducted related to the § 112 violations.
Having first defined the scope of the claims to have encompassed the overall production of lysine (beyond just the specific disclosed genetic mutations), the ALJ concluded that the inventors had violated the best mode requirement in their '698 application by:
(1) concealing their preferred and only host strain, WC80-196S, via a misrepresentation of the steps actually performed to create a mutant Idc host strain; (2) concealing sucrose as their preferred carbon source, which materially affects achieving the claimed invention; and (3) submitting data associated with fictitious host strains in support of best mode.
With regard to the '160 patent, the ALJ concluded that the inventors had (1) purposely concealed their preferred host strain, AE-70; and (2) submitted fictitious data in support of their best mode.
The ALJ then considered the inequitable conduct issue and found that (1) the necessary materiality was established via the inventors' best mode disclosure violations; and (2) the intent to deceive was established through proof of the inventors' submission of fictitious data coupled with their concealment of the best mode; and, with respect to the '698 patent, (3) concealing the preferred carbon source. Ajinomoto petitioned the ITC for a review of the ALJ decision, but the ITC took no position on the ALJ's finding. Ajinomoto then appealed to the Court of Appeals for the Federal Circuit for review.
Writing for the majority, Judge Lourie cites to Teleflex, Inc. v. Ficosa N. Am. Corp., 299 F.3d 1313, 1330 (Fed. Cir. 2002) for the proposition that the best mode requirement "comprises part of the quid pro quo of the patent grant, prohibiting inventors from receiving the benefit of the right to exclude while at the same time concealing from the public preferred embodiments of their inventions." Judge Lourie also stated that "in order to satisfy the best mode requirement, an inventor must disclose the preferred embodiment of the invention as well as preferences that materially affect the properties of the invention." Bayer AG v. Schein Pharm., Inc., 301 F.3d 1306, 1319 (Fed. Cir. 2002). Judge Lourie then reiterated the two-prong inquiry for compliance with the best mode requirement. In the first "subjective" prong, the court must determine "whether, at the time the patent application was filed, the inventor possessed a best mode of practicing the claimed invention." United States Gypsum Co. v. Nat'l Gypsum Co., 74 F.3d 1209, 1212 (Fed. Cir. 1996). Judge Lourie noted the subjectiveness of the prong as it "focuses on the inventor's own personal preferences as of the application's filing date." In the second "objective" prong, if an inventor has a subjective preference for one mode over all others, the court must determine whether the inventor "concealed" the preferred mode from the public. Chemcast Corp. v. Arco Indus. Corp., 913 F.2d 923, 928 (Fed. Cir. 1990).
The Federal Circuit then addressed Ajinomoto's issues on appeal: whether the ITC made multiple legal errors in defining the scope of the claimed inventions and the scope of the best mode requirement. As its first argument, Ajinomoto claimed that the ITC erred in defining "best" in terms of "overall production of lysine" rather than in terms of the claimed invention. Ajinomoto supported its position with the argument that the ITC erroneously applied the best mode requirement to areas beyond the patents' innovative aspects (the claimed genetic mutations). Both the ITC and the defendants countered that the best mode requirement relates to the "claimed invention, not just to its 'inventive aspects,' as claimed by Ajinomoto. The CAFC agreed with the ITC/defendants' reasoning, concluding that nothing in Federal Circuit precedent limits the best mode requirement to "vague 'innovative aspects' or 'inventive features' of the invention." The Court also concluded that the ITC correctly included the obligation of the inventors to include their preferred host strains as the best mode. The Court reasoned that the ITC's definition of the method to include the host strains properly defined the scope of the claimed invention to include "cultivating a bacterium."
Ajinomoto also argued that the ITC's interpretation was erroneous because Ajinomoto's best mode obligations extended only to the claimed Idc and dapA mutations, without which Ajinomoto could not exclude others from cultivating lysine-producing strains. Central to Ajinomoto's position was its argument that because the two mutations could be used in any E. coli strain, the inventors had no obligation to disclose their preferred strain. In support of its position, Ajinomoto cited to numerous cases where inventors were found not to have concealed the best mode even where they had not disclosed their preferred embodiments. The Federal Circuit disagreed and distinguished the cited cases from the current case on the grounds that, in all of the cited cases, the asserted claims as construed did not cover the embodiment alleged to have been concealed. The Federal Circuit reasoned that, as Ajinomoto's host strain was "claimed rather than unclaimed subject matter," the inventors' were under an obligation to disclose their preferred strain. The Court also stated that Ajinomoto's claimed right to exclude competitors from practicing a method of producing lysine using bacteria with the disclosed mutations also obligated them to disclose the best bacterium for carrying out the invention, thereby satisfying the "two-way street" of the best mode obligation.
Ajinomoto also argued that, even if the best mode requirement did extend to disclosure of the preferred bacteria strains, the ITC erred in its application of the requirement with respect to the '698 patent. Specifically, Ajinomoto argued that the ITC erred in finding that the inventors were required to disclose the host strain into which they inserted the Idc mutation. Ajinomoto also stressed that the inventors' deposit of a strain containing the lysC variant and disclosure of said deposit within the specification satisfied their responsibilities under the best mode requirement. The ITC countered that the inventors "concealed the only bacterial strain altered to contain the patented Idc mutation, and thus the only embodiment of the invention, by failing to identify it in any way, either by name or by its method of creation." The Federal Circuit disagreed with Ajinomoto, stating that the ITC opinion found that the inventors improperly concealed the identity of the preferred host strain, not the method of creating the host strain. The Court also stated that the best mode requirement "cannot be satisfied by the deposit of a non-preferred strain. The Court noted that the strain deposited by the inventors lacked the sucrose utilization genes of the preferred embodiment and, therefore, was not the strain that contained the Idc mutation. The Federal Circuit conceded that the deposited strain contained the lysC variant; however the Court also concluded that this, in and of itself, was insufficient to satisfy the best mode requirement. The Court reasoned that as the specification contained no disclosure of the fact that the deposit contained the lysC variant, thereby precluding one having skill in the art from knowing of the alteration, the deposit "failed to enable one of skill in the art to practice the inventors' preferred embodiment and thus concealed the best mode."
Ajinomoto's final argument addressed its position
that the ITC erred in invalidating claim 15 of the '160 patent. Ajinomoto stated that even if the
inventors concealed the best host strain as of the filing date of the 1993
Japanese application, the only result is that the Ajinomoto cannot rely on that
date for priority purposes under 35 U.S.C. § 120. Ajinomoto asserted that it could still claim
priority to the November 24, 1994 PCT filing date, thereby necessitating a
finding by the Court that the defendants had infringed the '160 patent, thereby
violating § 337. The ITC and
the defendants countered that Ajinomoto, by not raising the matter in its
pre-trial brief as required under the ALJ's stated ground rules, had waived its
right to rely on its PCT application's filing date. The ITC also argued that Ajinomoto's claim of priority from
the 1993 benefited Ajinomoto by concealing its best mode's priority date from
the public and limiting the prior art upon which the defendants could rely for
their invalidity defenses. The Federal Circuit
agreed with the ITC and the defendants, stating that "a patentee cannot,
as Ajinomoto attempts here, reverse a finding of invalidity by unveiling after
trial an alternative priority date on which it would now like to rely."
Ajinomoto Co. v. International Trade Commission (Fed. Cir. 2010)
Panel: Circuit Judges Newman, Lourie, and Linn
Opinion by Circuit Judge Lourie