Star Scientific, Inc. v. R.J. Reynolds Tobacco Co. (Fed. Cir. 2011)

By Kevin E. Noonan --

The Federal Circuit reaffirmed the primacy of the factual disclosures used to establish obviousness, and how deficiencies thereof can defeat an obviousness claim, in reversing an invalidity determination in Star Scientific, Inc. v. R.J. Reynolds Tobacco Co.  It also showed how persistently defendants pursue the tarnish of inequitable conduct even under circumstances where the Federal Circuit has held that no inequitable conduct occurred.

The patents-in-suit, U.S. Patent Nos. 6,202,649 and 6,425,401 (filed as a continuation of the '649 patent), were directed to methods for curing tobacco in a way that reduced the amount of a carcinogen, tobacco-specific nitrosamines (TSNAs), in the cured product used in cigarettes and other tobacco-containing products.  The patents were specifically directed to "indirect" flue curing with gas or propane heaters.  Former methods used "direct" flue curing that mixed the exhaust gasses with the tobacco, but this resulted in an oxygen-free environment that fostered the growth of bacteria on the leaves, leading to production by the bacteria of the carcinogenic TSNAs.  The patented methods can be used with either direct or indirect curing methods by using "controlled conditions" involving humidity, temperature, rate of temperature exchange, carbon monoxide levels, carbon dioxide levels, oxygen levels, and how the tobacco plants are arranged in the curing shed.  The claims specify "controlling conditions" by "determining and selecting" the "appropriate" values for these variables that results in the reduction of TSNA production "at least one").  However, the patents admit that the choice of these conditions are "more art than science," so need to choose the appropriate combination of these variables; however, the important consideration is maintaining an aerobic environment that prevents bacterial growth.

Claims 4 and 12 of the '649 patents are set forth for the Court as being representative (emphasis in the opinion):

4.  A process of substantially preventing the formation of at least one nitrosamine in a harvested tobacco plant, the process comprising:
    drying at least a portion of the plant, while said portion is uncured, yellow, and in a state susceptible to having the formation of nitrosamines arrested, in a controlled environment and for a time sufficient to substantially prevent the formation of said at least one nitrosamine;
    wherein said controlled environment comprises air free of combustion exhaust gases and an airflow sufficient to substantially prevent an anaerobic condition around the vicinity of said plant portion; and
    wherein said controlled environment is provided by controlling at least one of humidity, temperature, and airflow.

12.  The process according to claim 4, wherein the treatment time is from about 48 hours up to about 2 weeks.

The lawsuit arose after R.J. Reynolds (RJR) acquired previous licensee Brown and Williamson and terminated the license.  In addition, RJR has its own patents (referenced in the opinion as the Peele reference), issued as U.S. Patent No. 6,805,134 that specified a "not direct" heat source and curing in the absence of nitrocv oxide gas, which was performed by retrofitting direct cure barns into indirect-cure barns.

As an initial matter, the District Court granted summary judgment that the '649 and '401 patents were not entitled to priority to a provisional application, based on disclosure in the provisional that the claimed methods utilized an air flow of "at least 28,000 cubic feet per meter (CFM)" whereas the common specification of the '649 and '401 patents specified an air flow of "approximately 25,000 CFM."  As a consequence, the District Court was able to consider intervening art to be prior art, and to decide that the patentee did not disclose the best mode (based on development of the commercial embodiment (and acknowledged best mode) in the period between the provisional and non-provisional filing dates.

In an earlier decision, the Federal Circuit reversed a finding that the claims were indefinite for reciting the term "anaerobic condition" and reversed a finding of inequitable conduct for failure to disclose a purported prior art reference (termed the "Burton letter").  Despite this decision, the District Court permitted defendants to display a slide (below) during closing argument showing a shadowy person disclosing information to the PTO examiner but holding the disputed Burton letter reference behind his back, during part of closing argument relating to invalidity rather than inequitable conduct.

The jury delivered a verdict of non-infringement and invalidity based on obviousness, anticipation, indefiniteness, and failure to disclose the best mode.  The obviousness determination was based on a prior art scientific journal review relating to methods for air curing and a published Japanese patent.  In view of the District Court's decision on the priority question, the jury applied the method disclosed in the Peele '134 patent as well as the practice of methods at two farms (Spindletop and the Brown farm) as a public use (the Brown tobacco farm being under contract to RJR).  The indefiniteness determination was directed at the term "controlled environment," which the Court found as a matter of law was incapable of being construed because the disclosed "controlled environment" conditions overlapped with "conventional" curing conditions so that the skilled worker could not understand the difference.  The best mode determination was based squarely on the District Court's priority determination, since it was uncontested that the best mode commercial embodiment was not disclosed and had been developed prior to the non-provisional filing dates.  Finally, the jury found that there was no infringement, based on oxygen levels in RJR's barns alleged to be infringing.  The District Court denied Star's motions for JMOL of these adverse decisions.

The Federal Circuit, in an opinion by Chief Judge Rader, joined by Judge Linn and by Judge Dyk in part, who dissented as to the Court's decision to reverse invalidation for indefiniteness, reversed the District Court's grounds for invalidating the '649 and '401 patents, and affirmed the District Court's denial of JMOL on the jury's non-infringement decision.  The Federal Circuit also reversed the finding that the '649 and '401 patents were not entitled to the provisional filing date, on the basis that the specification satisfied the priority standard:  that the specification disclosed an adequate written description and enabled the patents' claims.

This part of the opinion was supported by an intervening decision by the USPTO in a reexamination of the '649 and '401 patents that these patents were entitled to the priority date (although the PTO found certain of the claims were invalid for obviousness).  The Court based its decision on language in the provisional specification that the recited air flow speed (in CFM) could "vary according to conditions and may be determined on a routine basis," and thus held that the District Court had improperly narrowed the claim scope based on later examples in the non-provisional application.

As a consequence of the Court granting the priority date of the provisional application to the '649 and '401 patents the best mode violation evaporated, since it was equally undisputed that the commercial method was not known at the time the provisional application was filed.  Another consequence, germane to anticipation and obviousness is that the Peele '134 patent was not prior art that could be asserted against the patents in suit.

In reversing the District Court's indefiniteness determination, the majority opinion cites Datamize LLC v. Plumtree Software Inc. for the standard that a claim must be "insolubly ambiguous" or "not amenable to construction" to be found indefinite.  However, the majority cautioned that "[a]bsolute clarity [is] not required" and that the term at issue -- "controlled environment" -- does not require disclosure of exact values for the various parameters because the skilled worker would understand the variable and empirical nature of determining these conditions.  In this the opinion cites language from the Peele '134 patent -- owned by RJR -- consistent with its interpretation of the understanding of the worker skilled in the art.

Regaring obviousness, the Court disagreed with jury verdict that the references render the claims obvious.  The opinion characterized the Japanese patent as being directed at improving fast curing to avoid "nasty odor" (an advantage not related to TSNA production) and found the Wiernik reference to be inconclusive on whether bacteria were involved in TSNA production.  In addition, the opinion notes that neither reference discusses exhaust gases or anaerobic conditions.  Thus, the Court found that there would be no motivation (or in the mantra approved by the KSR Court, "reasoned basis") for the skilled worker to combine these references to arrive at a solution to the problem of TNSA production during tobacco curing.  The Court also found significant evidence of secondary considerations, including:  a recognized, unmet need in the art for reducing TSNA in cured tobacco; unsuccessful attempts (i.e., failure) by others to solve this recognized problem; purported unexpected results (never expressly set forth in the opinion); and commercial success (ironically for RJR, using the lucrative B&W licenses as evidence thereof).

The Court reversed the jury's anticipation finding as to the Peele method because it was no longer prior art in view of the earlier priority date.  The two "public uses" were not prior art, because the Court found that the "Spindletop" use involved tobacco cured before treatment in the drying shed (so that it was not "uncured" tobacco, as required by the claims).  The "Brown farm" use did not anticipate, according to the Court's opinion, because the reported test results were below the detection threshold for TNSAs and thus provided no evidence that this method satisfied the specifically recited range of TSNA reduction required by the claims.

Finally, the Court upheld the non-infringement decision based on the jury's prerogative to believe one (RJR's) expert over another (Star's), and that the evidence did not establish that no reasonable jury could come to such a decision (i.e., the District Court properly denied Star's JMOL motion).

The Court also refused to deny Star's appeal on evidentiary rulings permitting (inter alia) display of the "shadowy figure" slide (although the Court found its use "troubling"), because Star did not show harm resulting from the objectionable evidence.

Judge Dyk dissents in part, arguing that the patents are invalid for indefiniteness -- in his view, the specification did not sufficiently distinguish the "controlled" conditions from "conventional" conditions and thus did not "particularly point out and distinctly claim" the invention so that the skilled worker could not ascertain the metes and bounds of infringing behavior.

Star Scientific, Inc. v. R.J. Reynolds Tobacco Co. (Federal Circuit 2011)
Panel: Chief Judge Rader and Circuit Judges Linn and Dyk
Opinion by Chief Judge Rader; opinion concurring-in-part and dissenting-in-part by Circuit Judge Dyk

Comments

[Izof_texas]

Very concise and thorough appraisal!

I am not aware of the USPTO having found any claims "obvious", but I could be wrong.

I would like to comment extensively on Judge Dyk's dissent, which I (not a legal professional, but know quite a bit about the law and have studied this case since its inception in 2001) believe is due to a misconception of just what "the controlled environment" is. (In fact, I'm not sure that everyone to do with the case hasn't lost sight of the ball on that matter.)
_____

I think it is clear that Judge Dyk’s dissent was based on a misunderstanding of the term “controlled environment” … thinking it to be, as I had been writing for months I feared would happen, “the curing barn”.

In fact, I believe that everyone connected with the case, to RJR’s advantage, has been horn-wrestled into the view favoring RJR’s case … that “the barn” is “the controlled environment”. IT IS NOT.

I have written several long writeups explaining this, but I will try to be very brief, and less explanatory, here and see if it works.

The patents’ claims carefully specify that “the controlled environment” is a SMALL VOLUME “around each plant portion” of the load of tobacco within the curing barn. They teach that the conditions IN THE BARN have to be manipulated so that ALL OF THOSE little “controlled environments” around each plant portion maintain an aerobic condition.

Thus the patents teach that one should control the variables temperature, humidity, air flow [both within the barn and between the barn and "ambient" air], and [in the specification] the arrangement of the tobacco leaves themselves within the barn overall such that each little “controlled environment” around each “plant portion” is at all times aerobic (meaning with characteristics, in terms of oxygenation, etc., equal to that of “ambient air” outside the vicinity of the curing barn).

One skilled in the art realizes that it is like a “weakest link in the chain” situation. He/she realizes that one must manipulate those variables (with)IN THE BARN so that the small “controlled environment” around the tobacco plant portion that is the LEAST WELL VENTILATED within the barn remains “aerobic”.

Seeing that, it is perfectly clear, it seems to me, what makes the Williams method “different from conventional curing”: THAT PROCESS.

In “conventional curing” it has never been suggested that one ensure (by manipulating barn parameters overall) that every “microenvironment” within a curing barn … around EACH PLANT PORTION … be maintained in an “aerobic state” in order to substantially prevent the formation of one or more tobacco specific nitrosamines (per the court’s construction of "substantially prevent"). Though a bit complex, the language seems appropriately concise, and completely explanatory when carefully read.

In fact, the (Judge) Michel panel in the first appeal, of the initial I.C. trial result ("Star I"), seemed to appreciate this process/concept MARVELOUSLY. Oddly, Judge Dyk was a part of that Michel panel, and I had counted on him to carry forward that understanding. It is strange (and a bit scary … a close call for Star) the way things work out some times.

[6]

I have to admit I like their little drawing.

[ochart]

izof_texas, ochart that was beautiful, standing up clapping hands really fast

[Dave Korpi]

Hey Guys!

I was one of the engineers who provided Sierra Mass Flow Meters to measure the mass flow rate, the 25,000 to 28,000 CFM of pai passing through the Barn or the "Controlled volume" which is under concern. I just mention it because it became clear that the mass flow rate of the air passing by the tobacco leaves was causal to the quality of the end product and the measure of the TNSA.

Fun stuff for a rather crazy industry indeed.. If YOU need to measure the mass flow rate of air in a process then take a look at the flow meters from Sierra yourself. They are easy to use and make controlling the environment easy in a feedback loop!