Patent Docs

In re Antor Media Corp. (Fed. Cir. 2012)

By Kevin E. Noonan --

In a case otherwise of little interest to the biotech/pharma community, the Federal Circuit last month increased the burden on proving patentability created by prior art references for patent applicants and patentees.  This was accomplished by defining a presumption of enablement not only for prior patents and published patent applications but also for all prior printed publications, regardless of source of provenance.

The case involved an appeal from a U.S. Patent and Trademark Office rejection (in five ex parte reexaminations merged for consideration by the Office) of claims in U.S. Patent No. 5,734,961 directed to "to a method and apparatus for transmitting information recorded on digital disks from a central server to subscribers via a high data rate telecommunications network."  For completeness, independent method claim 1 is set forth as follows:

1.  Method of receiving information from one of a plurality of information systems via a high data rate telecommunication network in response to a request from one of plural subscriber stations, said method comprising the steps of:
    initiating a two-way transmission from subscriber computer means of said one of said plural subscriber stations to one of said in formation systems via said telecommunication network,
    outputting on output means of said one of said plural subscriber stations data related to plural information stored at one of said information systems,
    selecting at said one of said plural subscriber stations at least one of said information by means of input means of said one of said plural subscriber stations and transmit- ting a signal identifying said at least one selected information from said subscriber computer means to a selected information system via said telecommunication network,
    receiving at said one of said plural subscriber stations from said selected information system digital signals via said telecom- munication network, expanding by expansion means said transmitted signals, converting said expanded digital signals into analog signals and delivering said analog signals to transducer means.

This claim and others (including some that added a "controller" limitation) were rejected over four prior art references:

• Arif Ghafoor et al., A Distributed Multimedia Database System, Dep't of Elec. & Comp. Eng'g, Syracuse Univer sity (1988 IEEE).

• Stavros Christodoulakis & Theodora Velissaropoulos, Issues in the Design of a Distributed Testbed for Multimedia Information Systmems (MINOS), Journal of Mgmt. Inf. Sys., Vol. 4, No. 2 (1987).

• H.K. Huang et al., Picture Archiving and Communications Systems (PACS) for Radiological Images: State of the Art, CRC Critical Reviews in Diagnostic Imaging, Vol. 28, Issue 4 (1988).

• Barrett, U.S. Patent 4,918,588 (granted April 17, 1990).

In an opinion by Judge Lourie, joined by Chief Judge Rader and Judge Bryson, the Federal Circuit affirmed the PTO determination that the claims were either anticipated or obvious.  In arriving at this conclusion, the Court addressed Antor's argument that the Board erred when it considered the prior art printed publications to be presumptively enabled.  The Court set out the following reasoning for its disagreement with this argument.

The opinion cites Amgen Inc. v. Hoechst Marion Roussel, Inc., 314 F.3d 1313, 1354 (Fed. Cir. 2003), for the proposition that "both claimed and unclaimed materials disclosed in a patent are presumptively enabling," noting that during prosecution "the examiner is entitled to reject application claims as anticipated by a prior art patent without conducting an inquiry into whether or not that patent is enabled or whether or not it is the claimed material (as opposed to the unclaimed disclosures) in that patent that are at issue," citing In re Sasse, 629 F.2d 675, 681, 207 USPQ 107, 111 (C.C.P.A. 1980).  This is not determinative, however, because the applicant can then rebut the presumption by submitting evidence that the reference is not enabled.

The panel recognizes, however, that the Amgen case "did not decide whether a prior art printed publication, as distinguished from a patent, is presumptively enabling during patent prosecution," although in so going the Amgen Court did suggest that such a presumption was likely, saying that "[w]e note that by logical extension, our reasoning here might also apply to prior art printed publications as well, but as Sugimoto is a patent we need not and do not so decide today."

Accordingly, the opinion makes express that "logical extension":  "the issue regarding non-patent publications [being] squarely before the court [], we now hold that a prior art printed publication cited by an examiner is presumptively enabling barring any showing to the contrary by a patent applicant or patentee."  In coming to this conclusion, the panel rejected Antor's argument that printed publications should be treated differently than patents because of the statutory presumption of validity that attaches to a patent.  35 U.S.C. § 282.  The basis here was the same basis the panel used in Amgen:  § 282 is not the source of the presumption; rather, the panel here notes that the precedent cited in the Amgen case applied the logic that "it is procedurally convenient to place the burden on an applicant who is in a better position to show, by experiment or argument, why the disclosure in question is not enabling or operative" and thus that prior art patents can be presumed enabling for both claimed and unclaimed subject matter.  Finally, closing the logical loop this panel explained that the undisclosed subject matter in a patent is not examined at all and thus in no different a posture than what is contained in a non-patent prior art publication.  (The same could also be said, but it was not mentioned in the opinion, for prior art published applications.)

The consequence of this decision, according to the panel, changes nothing for patentees or applicants, because in any case the examiner "is governed by 35 U.S.C. § 132, which requires notification to an applicant of the reasons for a rejection with 'such information and references as may be useful in judging of the propriety of continuing the prosecution of his application.'"  Provided that an examiner has included in an Office Action "the theory of the rejection, the prior art basis for the rejection, and where each limitation of the rejected claims is shown in the prior art reference" she has met her burden under the statute.  As a practical matter, the Court is aware that the examiner, having "no access to experts or laboratories, is not in a position to test each piece of prior art for enablement in citing it, and requiring him to do so would be onerous, if not impossible."  Thus:

Consistent with the statutory framework and our precedent, we therefore hold that, during patent prosecution, an examiner is entitled to reject claims as anticipated by a prior art publication or patent without conducting an inquiry into whether or not that prior art reference is enabling.  As long as an examiner makes a proper prima facie case of anticipation by giving adequate notice under § 132, the burden shifts to the applicant to submit rebuttal evidence of nonenablement.

This decision has important implications for practitioners attempting to provide patent protection for biotechnology-based inventions.  A great deal of biotechnology research and inventions have derived from university inventors, and even for those inventions that do not their inventiveness is assessed in view of prior art produced by university researchers.  It is a feature of some of this art that portions therein are reserved for what can most kindly be called discussions of possible future implications and applications of a scientific result (unkindly, these can be nothing less than unsupported flights of fancy).  However, the presence of such language in scientific references such as journal articles not expressly provides a much more robust source of prior art, insofar as anything said in a prior art printed publication now falls expressly within the presumption that it is enabled.  While in many cases this will not pose an insurmountable challenge, it can be expected at the very least to increase the difficulties and cost of obtaining patents, and to open up a host of new prior art for use in invalidity defenses (the panel here noted that in Amgen "that presumption applies in the district court as well as the PTO, placing the burden on the patentee to show that unclaimed disclosures in a prior art patent are not enabling").  And while the heightened burden of "clear and convincing" evidence may serve to ameliorate this change in the district courts, the situation is very different during patent prosecution or reexamination, due to the "substantial evidence" standard of review used by the Federal Circuit for factual determinations by the Office.  In re Gartside, 203 F.3d 1305, 1316 (Fed. Cir. 2000).  These consequences are even more significant in view of the expanded potential for post-grant review occasioned by enactment of the Leahy-Smith America Invents Act.

One hypothetical example may suffice.  (NOTE to the literal minded:  what follows is generally not patentable or patent eligible; it is just an example in extremis to make the point).  As noted previously, perhaps the most beautiful sentence in scientific literature is this one:

It has not escaped our notice that the specific pairing we have postulated immediately suggests a possible copying mechanism for the genetic material.

James Watson & Francis Crick, "Molecular Structure of Nucleic Acids; A Structure for Deoxyribose Nucleic Acid," Nature 171: 737-38 (April 25, 1953).  Now let's assume that patent protection was being sought for any of the practical applications of specific basepair hybridization (solution reassociation, various "blotting" techniques, even recombinant DNA production requiring proper hybridization of DNA fragments asymetrically cut with different restriction enzymes) and ask, what would the effect of this sentence be on such claims, keeping in mind that when Watson and Crick wrote this sentence they had no experimental evidence (of their own) and that the accuracy of their insight on the structure of DNA would take years to conclusively establish.

In re Antor Media Corp. (Fed. Cir. 2012)
Panel: Chief Judge Rader and Circuit Judges Lourie and Bryson
Opinion by Circuit Judge Lourie

Court Report

By Sherri Oslick --

About Court Report:  Each week we will report briefly on recently filed biotech and pharma cases.

Bayer Intellectual Property GmbH et al. v. Warner Chilcott Company LLC et al.
1:12-cv-01032; filed August 13, 2012 in the District Court of Delaware

• Plaintiffs:  Bayer Intellectual Property GmbH; Bayer Pharma AG
• Defendants:  Warner Chilcott Co. LLC; Warner Chilcott (US) LLC; Warner Chilcott PLC

Infringement of U.S. Patent No. 5,980,940 ("Pharmaceutical Combination Preparation for Hormonal Contraception," issued November 9, 1999) based on Warner Chilcott's manufacture and sale of its Lo Loestrin product (norethindrone acetate and ethinyl estradiol tablets, used for oral contraception).  View the complaint here.

Luitpold Pharmaceuticals, Inc. v. Amneal Pharmaceuticals, LLC et al.
3:12-cv-05064; filed August 10, 2012 in the District Court of New Jersey

• Plaintiff:  Luitpold Pharmaceuticals, Inc.
• Defendants:  Amneal Pharmaceuticals, LLC; Amneal Holdings, LLC; Amneal Pharmaceuticals Holding Co., LLC; Amneal Pharmaceuticals of New York, LLC.; Amneal Pharmaceuticals Co. India Private Ltd.; Recordati Ireland Ltd.

Infringement of U.S. Patent No. 6,333,044 ("Therapeutic compositions for intranasal administration which include KETOROLAC®," issued December 25, 2001) following a Paragraph IV certification as part of Amneal's filing of an ANDA to manufacture a generic version of Luitpold's Sprix® (ketorolac tromethamine nasal spray, used for the management of moderate to moderately severe pain that requires analgesia at the opioid level).  View the complaint here.

Janssen Pharmaceuticals, Inc. v. Glenmark Generics Ltd. et al.
2:12-cv-05009; filed August 9, 2012 in the District Court of New Jersey

• Plaintiff:  Janssen Pharmaceuticals, Inc.
• Defendants:  Glenmark Generics Ltd.; Glenmark Generics Inc., USA

Infringement of U.S. Patent No. 6,214,815 ("Triphasic Oral Contraceptive," issued April 10, 2001) following a Paragraph IV certification as part of Glenmark's filing of an ANDA to manufacture a generic version of Janssen's Ortho Tri-Cyclen® Lo (norgestimate and ethinyl estradiol, used for oral contraception).  View the complaint here.

Ariad Pharmaceuticals, Inc. v. Kappos
1:12-cv-00886; filed August 9, 2012 in the Eastern District of Virginia

Review and correction of the patent term adjustment calculation made by the U.S. Patent and Trademark Office for U.S. Patent No. 8,114,174 ("Substituted Acetylenic Imidazo[1,2-B] Pyridazine Compounds as Kinase Inhibitors," issued February 14, 2012).  View the complaint here.

Conference & CLE Calendar

August 21, 2012 - Mayo v. Prometheus: The Supreme Court's New Methodology for Analyzing Patent Eligibility (American Bar Association) - 1:00 - 2:30 pm (EDT)

August 22, 2012 - The Final USPTO AIA Rules: What You Need to Know (American Intellectual Property Law Association) - 12:30 - 2:00 pm (Eastern)

August 24, 2012 - The America Invents Act: The Boundaries of Prior Art (American Bar Association) - 1:00 - 2:30 pm (EDT)

August 27, 2012 - AIA Post-Grant Implementation Begins – Is Your Business Strategy Aligned? (Foley & Lardner) - 3:00 pm (Eastern)

August 30, 2012 - The Written Description Requirement: Are Antibodies Chemicals, Proteins, or Exceptions? (American Bar Association) - 1:00 - 2:30 pm (Eastern)

September 6, 2012 - A Review of the Impact of Recent Supreme Court and Federal Circuit Decisions on Patent Strategy (McDonnell Boehnen Hulbert & Berghoff LLP) - 10:00 - 11:15 am (CT)

September 9-11, 2012 - IPO Annual Meeting (Intellectual Property Owners Association) - San Antonio, TX

September 10-12, 2012 - Business of Biosimilars & Generic Drugs (Institute for International Research) - Boston, MA

September 19, 2012 - New Post Grant Proceeding Rules: Adjusting to the New Reality (Technology Transfer Tactics) - 1:00 - 2:15 pm (Eastern)

September 20-21, 2012 - FDA Boot Camp*** (American Conference Institute) - Boston, MA

September 24-25, 2012 - Biosimilars and Biobetters*** (SMi) - London, UK

September 25-26, 2012 - EU Pharma Regulatory Law*** (C5) - Brussels, Belgium

September 28, 2012 - Focus on Biologics and Biosimilars (Catalyzing Collaboration Between Industry and Academia in the Life Sciences) - Hospira, Inc., Lake Forest, IL

October 10-11, 2012 - Maximizing Pharmaceutical Patent Lifecycles*** (ACI) - New York, NY

October 10-11, 2012 - Biotech & Pharmaceutical Patenting*** (C5) - London, UK

October 22-23, 2012 - Tech Transfer Summit North America*** (Tech Transfer Summit Ltd.) - John Hopkins University, Montgomery County, MD

October 24-25, 2012 - FDA Boot Camp Devices Edition*** (American Conference Institute) - Chicago, IL

***Patent Docs is a media partner of this conference or CLE

ABA Journal Accepting Nominations for 6th Annual Blawg 100

The ABA Journal has begun work on its 6th annual list of the 100 best legal blogs (or blawgs) and has announced that it is seeking the advice of its readers, via the ABAJournal.com website, on which blawgs and practice areas to include on this year's Blawg 100.  Readers interested in nominating a particular blog or practice area should use the blawg 100 amici form provided on the ABA Journal website.  Additional information about the Blawg 100 can also be found on the blawg 100 amici form.  The form requires that anyone making a nomination provide a name, employer or law school, city, and e-mail address.  The ABA Journal requires this information in order to discourage:

• Blawggers who nominate their own blawgs or nominate blawgs to which they have previously contributed posts.
• Wives and husbands who nominate their spouses' blawgs.
• Employees of law firms who nominate blawgs written by their co-workers.
• Public relations professionals in the employ of lawyers or law firms who nominate their clients' blawgs.
• Pairs of blawggers who have clearly entered into a gentlemen's agreement to nominate each other.

The ABA Journal, however, welcomes comments from readers who do not fall into the above categories.

Nominations must be submitted no later than Friday, September 7.

ACI FDA Boot Camp Devices Edition

American Conference Institute (ACI) will be holding its FDA Boot Camp Devices Edition conference on October 24-25, 2012 in Chicago, IL.  ACI faculty will help attendees:

• Master the basics of the application and approval processes, including 510(k) clearance and PMAs;
• Navigate the complexities of device regulations;
• Comprehend the structure of the FDA and the roles of the three major agency centers:  CDER, CBER, and CDRH;
• Develop a practical working knowledge of clinical trials and IDEs;
• Learn how devices are classified, monitored, and regulated;
• Recognize the pivotal role of labeling and learn how to avoid misbranding and off label promotion;
• See the importance of cGMPs and QSRs to the post-approval regulatory process; and
• Navigate the protocols of adverse events monitoring, product withdrawals, and recalls.

In particular, ACI's faculty will offer presentations on the following topics:

• The basics: Understanding and working with the FDA -- jurisdiction, functions, organization, and operations;
• Overview of device regulation;
• Understanding clinical trials and the investigational device exemption (IDE);
• Comprehending the 510(k) clearance process;
• Navigating the premarket approval process (PMA);
• Complying with general post-market controls;
• Understanding FDA enforcement tools, policies, practices, and trends;
• Labeling and promotion;
• Medical device reporting;
• Guidance for navigating recalls and withdrawals; and
• Quality system regulation.

A pre-conference primer on the "Fundamentals of FDA Device Regulatory Law," will be offered on October 23, 2012 from 1:00 - 4:00 pm.  The workshop will provide a basic overview of FDA regulations and will prepare attendees for the in-depth discussions that will take place throughout the conference.

A post-conference master class on "Unique Regulatory Schemes for Specialized Devices: In Vitro Diagnostics and Software Classified as Devices" will be offered from 2:00 - 5:15 pm on October 25, 2012.  The master class will provide attendees with enhanced information specific to in vitro diagnostics and software that is classified as a medical device and will help attendees thoroughly comprehend the complexities and nuances of these areas of regulatory law.

An agenda for the conference can be found here, and more information regarding the pre-conference primer and master class can be found here.  A complete brochure for this conference, including an agenda, detailed descriptions of conference sessions, list of speakers, and registration form can be obtained here.

The registration fee is $2,295 (conference alone), $2,895 (conference and pre-conference primer or master class), or $3,495 (conference, pre-conference primer, and master class).  Those registering by August 24, 2012 will receive a $300 discount and those registering by September 21, 2012 will receive a $200 discount.  Patent Docs readers who reference the discount code "PD 200" will receive $200 off the current price tier when registering.  Those interested in registering for the conference can do so here, by calling 1-888-224-2480, by faxing a registration form to 1-877-927-1563, or by e-mailing [email protected].

Patent Docs is a media partner of ACI's FDA Boot Camp Devices Edition conference.

Webinar on Final AIA Rules

The American Intellectual Property Law Association (AIPLA) will be offering a webinar entitled "The Final USPTO AIA Rules: What You Need to Know" on August 22, 2012 from 12:30 - 2:00 pm (Eastern).  Sally Medley, Administrative Patent Judge with the USPTO Board of Patent Trials and Appeals, and Janet Gongola, Patent Reform Coordinator for the U.S. Patent and Trademark Office, will present an overview of the provisions and the final rules and respond to audience questions.  Topics to be discussed will include:  inventor's oath and declaration, supplemental examination, post-grant review, inter partes review, post-grant review of covered business method patents, implementing estoppels provisions for filers of ex parte reexaminations begun after final decisions in post grant or inter partes review, and statute of limitations.

The registration fee for the program is $145 (AIPLA member rate) or $175 (non-member rate).  Those interested in registering for the program, can do so here.

TTT Webinar on Post Grant Proceedings

Technology Transfer Tactics will be offering a webinar entitled "New Post Grant Proceeding Rules: Adjusting to the New Reality" on September 19, 2012 from 1:00 - 2:15 pm (Eastern).  Randi Isaacs, In-House Patent Counsel for Emory University's Office of Technology Transfer, and Charles R. Macedo of Amster, Rothstein and Ebenstein, LLP will dissect the new rules implementing post-grant proceedings under the Leahy-Smith America Invents Act and educate attendees on how to best adjust to these changes, while understanding how the changes will specifically affect university procedures and patent protection strategies.

The registration fee for the webinar is $197.  Those interested in registering for the webinar, can do so here.

Forum on Biologics and Biosimilars

As part of an ongoing forum to bring researchers from universities and companies together to exchange ideas, discuss challenges, and explore potential collaborations to promote commercialization, Catalyzing Collaboration Between Industry and Academia in the Life Sciences will be offering a forum entitled "Focus on Biologics and Biosimilars" on September 28, 2012 from 8:00 am to 5:15 pm (Central) at Hospira, Inc. in Lake Forest, IL.  The forum will provide a unique combination of presentations, roundtable discussions, and networking, emphasizing how industry and academia can work together to create advances in biologics and biosimilars.  An agenda for the forum can be found here.

The registration fee for the forum is $25.  Those interested in registering for the forum, can do so here until September 26.  Pre-registration is mandatory, as there will be no on-site registration.

Association for Molecular Pathology v. United States Patent and Trademark Office (Fed. Cir. 2012)

By Kevin E. Noonan --

As we reported earlier today, the Federal Circuit, in a decision that substantially reiterates its prior opinion, determined in Association for Molecular Pathology v. U.S. Patent and Trademark Office that, the Supreme Court's decision in Mayo v. Prometheus notwithstanding, claims to isolated human DNA satisfy the requirements of 35 U.S.C. 101.

At the outset, it must be noted that each of Judge Lourie's majority opinion, Judge Moore's concurring opinion and Judge Bryson's opinion concurring in part and dissenting in part substantially tracks their earlier opinions, as discussed previously (summaries of the earlier opinions can be found here (Judge Lourie), here (Judge Moore), and here (Judge Bryson)).  Accordingly, here the focus will be, as it must, on how the individual members of the panel addressed the Supreme Court's remand instruction to reconsider their opinion(s) in view of the Court's decision in Mayo v. Prometheus.

For Judge Lourie (and to some extent, Judge Moore), the answer to the question posed by the intervening Mayo decision is simple:  that decision did not change the standards for assessing the patent eligibility for compositions of matter and manufactures as enunciated by the Court in Funk Bros. Seed Co. v. Kalo Inoculant Co. and Diamond v. Chakrabarty.

Judge Lourie's majority opinion is frank in this assessment, stating that "Mayo does not control the question of patent-eligibility of [] claims to compositions of matter, [that are] expressly authorized as suitable patent-eligible subject matter in § 101."  For the majority, the claimed isolated DNA molecules are "not found in nature" and are "man-made, a product of human ingenuity."  Like all compositions of matter, the claimed molecules are "prepared from products of nature" but that is not enough to render them patent-ineligible per se, according to the opinion:

All new chemical or biological molecules, whether made by synthesis or decomposition, are made from natural materials.  For example, virtually every medicine utilized by today's medical practitioners, and every manufactured plastic product, is either synthesized from natural materials (most often petroleum fractions) or derived from natural plant materials.  But, as such, they are different from natural materials, even if they are ultimately derived from them.  The same is true of isolated DNA molecules.

The "primary framework" for assessing patent-eligibility of composition of matter claims remain "the Supreme Court's decisions in Chakrabarty and Funk Brothers" and "[w]hile Mayo and earlier decisions concerning method claim patentability provide valuable insights and illuminate broad, foundational principles" they do not alter the primacy of these earlier decisions, and in applying these decisions the majority opinion follows its earlier assessment of the patent-eligibility of the claimed DNA molecules.

Judge Lourie's opinion also sets out further grounds for overturning the District Court's decision rendering these claims invalid for being non-statutory subject matter.  These include that the District Court "created a categorical rule excluding isolated genes from patent eligibility," something that the opinion considers contrary to the Supreme Court's mandate that such categorical rules not be imposed in deciding subject matter eligibility.  The opinion cites Bilski v. Kappos (business methods) and Chakrabarty (living organisms) as cases where the Court has affirmatively rejected such per se rules of patent ineligibility.  Isolated DNA "is not and should not be considered a special case for purposes of patent eligibility under existing law" says Judge Lourie, expressly rejecting the District Court's distinction that "DNA represents the physical embodiment of biological information, distinct in its essential characteristics from any other chemical found in nature."

The opinion also notes that the question as embodied in that portion of the District Court's opinion and as argued by plaintiffs (that it may have an "unusual status as a chemical entity that conveys genetic information") does not permit courts to usurp the prerogative of Congress to address such policy questions, quoting Chief Justice Roberts in Nat'l Fed'n of Indep. Bus. v. Sebelius, 132 S. Ct. 2566, slip op. at 6 (2012) ("[W]e possess neither the expertise nor the prerogative to make policy judgments.  Those decisions are entrusted to our Nation's elected leaders, who can be thrown out of office if the people disagree with them.").  It is up to Congress to address this issue according to the opinion, which notes that Congress has in fact "enacted a comprehensive patent reform act during the pendency of this case."

Turning to the question of preemption (more properly, "undue" preemption) that concerned the Supreme Court in Mayo, which focused on its concern that permitting patents on particular subject matter would prevent use of that subject matter by others, the majority responds that "the answer to that concern is that permitting patents on isolated genes does not preempt a law of nature [because a] composition of matter is not a law of nature."  The opinion also notes that "a limited preemption" is an inherent property of the patent right.  The public benefit in granting that limited right to preempt is that "[w]hen the patent expires, the public is entitled to practice the invention of the patent."  In this regard, Judge Lourie notes that "[t]he seven patents being challenged here all expire by December 18, 2015" and that "[a]ny preemption thus is limited, very limited in the case of the present patents."

The majority opinion also rejects the contention, by plaintiffs and certain amici (most notably the government) that "remand of this case for reconsideration in light of Mayo might suggest [] that the composition claims are mere reflections of a law of nature."  Simply put, the opinion states that "they are not, any more than any product of man reflects and is consistent with a law of nature.  Everything and everyone comes from nature, following its laws.  But the compositions here are not natural products.  They are the products of man, albeit following, as all materials do, laws of nature."

Turning to the method claims, the Court unanimously held that these claims are not patent-eligible under the Supreme Court's Mayo decision (just as they had previously ruled that the claims were not patent-eligible under the Bilski "machine or transformation" test).  In doing so, the panel voiced its opinion that the Court's Mayo decision "made clear that such diagnostic methods in that case essentially claim natural laws that are not eligible for patent."  The panel did not apply the Mayo reasoning here, however, because in its view "those method claims cannot stand" under their earlier, arguably more permissive standard for patent eligibility in view of the Mayo decision.

Finally, turning to Claim 20 the panel decided unanimously that this claim is patent eligible because it recites a transformed host cell that is not naturally-occurring, analogous to the bacteria claimed by Chakrabarty.  This claim satisfies the Supreme Court's edict from Mayo that "to transform an unpatentable law of nature into a patent-eligible application of such a law, one must do more than simply state the law of nature while adding the words 'apply it'" because it utilizes this man-made cell.  And important to the panel's unanimous decision is that "the claim does not cover all cells, all compounds, or all methods of determining the therapeutic effect of a compound" but "[r]ather [] is tied to specific host cells transformed with specific genes and grown in the presence or absence of a specific type of therapeutic" (emphasis in opinion).

The panel also unanimously reaffirmed its earlier decision that Dr. Harry Ostrer, alone among the plaintiffs had standing to bring a declaratory judgment action and thus that the District Court properly denied Myriad's motion to dismiss.

And in perhaps an indication that the panel believed these questions to be more frivolous than the seriousness of the questions presented would suggest, it awarded costs to Myriad.

In her concurring opinion, Judge Moore also asserts that "the Prometheus decision does not control the outcome in this case" but concedes that "it is nonetheless instructive regarding the scope of the law of nature exception" and she rejects Myriad's contention that "Prometheus is constrained to method [claims]," calling it "untenable."  Regardless, she agrees with Judge Lourie that "Prometheus did not, however, overturn Funk Brothers or Chakrabarty," which she characterizes as "cases clearly more analogous to the one before us."  And using this jurisprudential "framework" she arrives at the same conclusion as Judge Lourie, that the claimed isolated DNA molecules are patent eligible if they represent "a composition of matter with 'markedly different characteristics' from that found in nature with the potential for significant utility."  With regard to utility, Judge Moore recognizes that "[t]he ability to use isolated DNA molecules as the basis for diagnostic genetic testing is clearly an 'enlargement of the range of . . . utility' as compared to nature," citing Funk Bros.  Regarding the oligonucleotide claims, she distinguished the Supreme Court's rubrics from Mayo on the grounds that "the claims to short isolated strands of DNA are not directed to the relationship between the mutation and cancer, but rather to a new tool that can be used to determine if that relationship exists."

As she did in her previous concurring opinion, Judge Moore states that, "[i]f deciding this case on a blank canvas" she "might conclude that an isolated DNA sequence that includes most or all of a gene is not patentable subject matter," noting that "[t]he scope of the law of nature/manifestation of nature exception was certainly enlarged in Prometheus."  However, as she opined previously she recognized here that this case is not decided on such a blank canvas, in view of the "expansive scope of patentable subject matter" authorized by Congress "for centuries."  She also once again cites the "decades" of U.S. Patent and Trademark Office practice in granting patents on isolated DNA molecules and the "thousands of patents with claims to isolated DNA, and some unknown (but certainly large) number of patents to purified natural products or fragments thereof."  Turning to an important and unaddressed concern underlying the "product of nature" argument espoused by plaintiffs and certain amici (once again, particularly the government), Judge Moore writes:

[P]urifying or isolating natural products has historically been exactly the kind of discovery protected by the patent statutes.  There is a century-long history of affirming patent protection for isolated and purified biological products ranging from hormones to vitamins to proteins to antibiotics.  These inventions must have seemed miraculous at the time, providing previously unknown therapeutic options to treat sickness.  The fact that these molecules might have existed in nature did not foreclose patent protection in view of the extraordinary benefits accessible to man after isolation.

In view of this history, for Judge Moore "[w]e cannot, after decades of patents and judicial precedent, now call human DNA fruit from the poisonous tree, and punish those inquisitive enough to investigate, isolate, and patent it" regardless of whether there are "moral, ethical, or theological components" to the policy question of whether DNA molecules should be patented.  Now as previously, Judge Moore believes that the patent eligibility of isolated DNA molecules "is a debate for Congress to resolve" and she once again is unwilling to "strip an entire industry of the property rights it has invested in, earned, and owned for decades unchallenged under the facts of this case."

As is the case with his judicial brethren, Judge Bryson substantially repeats his earlier opinion concurring in part and dissenting in part, parting company with the majority as to the patent eligibility of isolated genomic DNA molecules and oligonucleotides.  Unlike the majority, Judge Bryson finds the Supreme Court's Mayo decision to be "instructive" although he also voices the opinion that the Mayo decision "does not decide this case."  In analogy to the Court's requirement that there be something "inventive" added to the law of nature so that the claims add "enough" to be more than a mere statement of a natural law, Judge Bryson enunciates a requirement that "a patent involving a product of nature should have an inventive concept that involves more than merely incidental changes to the naturally occurring product."  Here, the question for Judge Bryson is whether claims to a composition of matter "that is nearly identical to a product of nature" is "enough" for the applicant to have made an "inventive contribution" to the product of nature.  On these grounds, Judge Bryson comes to the same conclusion as he has previously, joining the majority as to the cDNA claims but disagreeing that isolated genomic DNA or oligonucleotides are sufficiently "inventive" to be eligible for patenting.  And as he has previously indicated, Judge Bryson is apparently convinced that because "[t]he informational content of the nucleotide sequences is the critical aspect of these molecules" the identity of the informational content of the claimed molecules and the molecules as they exist in nature is enough for Judge Bryson to conclude that these claims are not patent eligible.

In many ways, this decision reestablishes the status quo ante, and invites the Supreme Court to revisit its watershed decision on the expansive scope of patent eligibility, the Chakrabarty decision.  Keeping in mind that Chakrabarty was decided by a vote of 5-4, this prospect, particularly in view of the (easily) perceived concerns and prejudices of the present Court, is disquieting.  Perhaps that is why the introductory portion of the majority opinion took pains to announce what the case was "not" about:

Before reviewing the applicability of the Supreme Court's Mayo holding to the claims of the Myriad patents, however, it is important to state what this appeal is not about.  It is not about whether individuals suspected of having an increased risk of developing breast cancer are entitled to a second opinion.  Nor is it about whether the University of Utah, the owner of the instant patents, or Myriad, the exclusive licensee, has acted improperly in its licensing or enforcement policies with respect to the patents.  The question is also not whether is it desirable for one company to hold a patent or license covering a test that may save people's lives, or for other companies to be excluded from the market encompassed by such a patent -- that is the basic right provided by a patent, i.e., to exclude others from practicing the patented subject matter.  It is also not whether the claims at issue are novel or nonobvious or too broad.  Those questions are not before us.  It is solely whether the claims to isolated BRCA DNA, to methods for comparing DNA sequences, and to a process for screening potential cancer therapeutics meet the threshold test for patent-eligible subject matter under 35 U.S.C. § 101 in light of various Supreme Court holdings, particularly including Mayo.  The issue is patent eligibility, not patentability.

* * *

Accordingly, we once again conclude that claims 1, 2, 5, 6, and 7 of the '282 patent; claims 1, 6, and 7 of the '492 patent; and claim 1 of the '473 patent directed to isolated DNA molecules recite patent-eligible subject matter under § 101.  Mayo does not change that result.  In so doing, we reiterate that the issue before us is patent eligibility, not patentability, about which we express no opinion.

Perhaps the Supreme Court will take these sentiments into consideration if (realistically, when) it finally hears this case.

Association for Molecular Pathology v. United States Patent and Trademark Office (Fed. Cir. 2012)
Panel: Circuit Judges Lourie, Bryson, and Moore
Opinion by Circuit Judge Lourie; concurring in part opinion by Circuit Judge Moore; concurring in part and dissenting in part opinion by Circuit Judge Bryson

AMP v. USPTO -- Federal Circuit Confirms Patent Eligibility of Isolated DNA

In a decision that substantially reiterates its prior opinion, the Federal Circuit decided today in Association for Molecular Pathology v. U.S. Patent and Trademark Office (the Myriad case) that, the Supreme Court's decision in Mayo Collaborative Services v. Prometheus Laboratories, Inc. notwithstanding, claims to isolated human DNA satisfy the requirements of 35 U.S.C. 101:

On the threshold issue of jurisdiction, we affirm the district court's decision to exercise declaratory judgment jurisdiction because we conclude that at least one plaintiff, Dr. Harry Ostrer, has standing to challenge the validity of Myriad's patents.  On the merits, we reverse the district court's decision that Myriad's composition claims to "isolated" DNA molecules cover patent-ineligible products of nature under § 101 because each of the claimed molecules represents a nonnaturally occurring composition of matter.  We also reverse the district court's decision that Myriad's method claim to screening potential cancer therapeutics via changes in cell growth rates of transformed cells is directed to a patent-ineligible scientific principle.  We affirm the court's decision, however, that Myriad's method claims directed to "comparing" or "analyzing" DNA sequences are patent ineligible; such claims include no transformative steps and cover only patent-ineligible abstract, mental steps.

Further analysis will be provided in subsequent posts.  The opinion of the Court can be found here.

USPTO Issues Several Final Rules for Implementing AIA Provisions

By Donald Zuhn --

On Tuesday, the U.S. Patent and Trademark Office published six notices in the Federal Register providing five final rules packages for implementing various provisions of the Leahy-Smith America Invents Act and a practice guide for proceedings before the Patent Trial and Appeal Board.  With the publication of the six notices, the Office has completed the first round of an AIA-related rulemaking process that began in January with the release of several notices of proposed rulemaking and a practice guide for proposed trial rules.

Earlier this summer, the Office issued final rules regarding the preissuance submissions by third parties provisions, statute of limitations provisions for Office disciplinary proceedings, and miscellaneous post patent provisions of the AIA:

• Changes To Implement the Preissuance Submissions by Third Parties Provision of the Leahy-Smith America Invents Act, 77 Fed. Reg. 42150 (July 17, 2012) -- Patent Docs report;

• Implementation of Statute of Limitations Provisions for Office Disciplinary Proceedings, 77 Fed. Reg. 45247 (July 31, 2012) -- Patent Docs report; and

• Changes To Implement Miscellaneous Post Patent Provisions of the Leahy-Smith America Invents Act, 77 Fed. Reg. 46615 (August 6, 2012) -- Patent Docs report.

The Office published the following notices on Tuesday:

• Rules of Practice for Trials Before the Patent Trial and Appeal Board and Judicial Review of Patent Trial and Appeal Board Decisions, 77 Fed. Reg. 48612 (August 14, 2012);

• Changes to Implement Inter Partes Review Proceedings, Post-Grant Review Proceedings, and Transitional Program for Covered Business Method Patents, 77 Fed. Reg. 48680 (August 14, 2012);

• Transitional Program for Covered Business Method Patents -- Definitions of Covered Business Method Patent and Technological Invention, 77 Fed. Reg. 48734 (August 14, 2012);

• Office Patent Trial Practice Guide, 77 Fed. Reg. 48756 (August 14, 2012);

• Changes To Implement the Inventor’s Oath or Declaration Provisions of the Leahy-Smith America Invents Act, 77 Fed. Reg. 48776 (August 14, 2012); and

• Changes To Implement the Supplemental Examination Provisions of the Leahy-Smith America Invents Act and To Revise Reexamination Fees, 77 Fed. Reg. 48828 (August 14, 2012).

The final rule implementing the inter partes and post-grant review proceedings and transitional program for covered business method patents provisions of the AIA combines rules that were separately proposed for derivation proceedings, inter partes review proceedings, and post-grant review proceedings under the AIA.  Thus, the need for fewer final rules notices than the number of notices of proposed rulemaking the Office issued earlier this year.

As with the final rules notices issued earlier this summer, Patent Docs will provide summaries regarding a number of the final rules notices published on Tuesday in subsequent posts.

In re Beineke (Fed. Cir. 2012)

By Kevin E. Noonan --

The Federal Circuit decided the In re Beineke case recently, affirming a decision by the USPTO's Board of Patent Appeals and Interferences that applicant Walter Beineke was not entitled to a patent for two strains of white oak trees under the Plant Patent Act of 1930 (as last amended in 1954).  While the court's decision is as unremarkable as it is apparently consistent with the scope of the Act intended by Congress in enacting it, the analysis is informative, particularly when compared with other recent decisions.

The Plant Patent Act is codified as 35 U.S.C. § 161:

Whoever invents or discovers and asexually reproduces any distinct and new variety of plant, including cultivated sports, mutants, hybrids, and newly found seedlings, other than a tuber propagated plant or a plant found in an uncultivated state, may obtain a patent therefor, subject to the conditions and requirements of this title,

(where the italicized portion of the text was introduced by amendment 1954).

Here, the subject matter claimed by Beineke were two white oak trees "in the front yard of a home," one being 118 years old and the other being 105 years old, having superior properties he recognized (including "excellent timber quality and strong central stem tendency").  He took acorns from these trees and planted them, and finding the beneficial traits to be retained reproduced them asexually.  Being successful, he applied for the two plant patents at issue.

The Examiner rejected both applications based on statutory exclusion of plants "found in an uncultivated state."  A divided Board affirmed, the majority finding that based on the Act's legislative history the question of whether a plant found in a "cultivated state" depends on "whether the existence or condition of the found plant itself has been affected by human activity (i.e., cultivation)."  Based on the fact that the land was uncultivated when the trees began to grow, only having been "cultivated" when the house was built in 1930, the Board held that applicant Beineke failed to satisfied the "cultivated" requirement of the statute, reasoning that "[s]urrounding a tree with a lawn does not change the state of the tree itself."  Two Board members disagreed, however, "stating that they 'understand 'cultivated' to be a requirement that the plant be the recipient of human labor only after its discovery,' and that they would have found the trees patentable because the trees were cultivated when Beineke discovered them."

On remand from the Board, applicant Beineke then submitted Rule 132 declarations in each application regarding whether the trees were "cultivated," but on their return to the Board, the applications were faced with no change in the Board majority's position.

The Federal Circuit affirmed, in a decision by Judge Dyk, joined by Judges Schall and Reyna.  The opinion begins by stating that because a proper consideration of the issues requires the Court to interpret the scope and meaning of the statute, its review is de novo.  The opinion then cites earlier case law indicating that an "inventor" of a plant patent must "recognize [the plant's] uniqueness and difference (citing Yoder Bros., Inc. v. Cal.-Fla. Plant Corp., 537 F.2d 1347, 1382 (5th Cir. 1976)) and have "taken the steps of asexual reproduction" (citing Imazio Nursery, Inc. v. Dania Greenhouses, 69 F.3d 1560, 1566 (Fed. Cir. 1995), citing Yoder at 1380).  The point of contention here, according to the Federal Circuit is whether it is enough to "find[] a new variety of mature plant," recognize its beneficial properties, cultivate and asexually reproduce it (Beineke's position), or whether the statute also requires that "human activity played a role in the creation of the plant," the statute's (i.e., Congress') intention being directed toward protecting the activities of "plant breeders who create new varieties of plants either intentionally or by accident" (the PTO's position).  The panel sided with the PTO in affirming the decision that Beineke is not entitled to his patents (albeit without adopting the Office's position in toto).

The first question the opinion addresses is whether "trees" as a class fall within the scope of the Plant Patent Act.  In this analysis, the opinion asserts that the statute requires that the plant be the result of "plant breeding or other agricultural or horticultural efforts" and that the patent be granted to an "inventor," defined as someone who "contributed to the creation of the plant in addition to appreciating its uniqueness and asexually reproducing it."  Beineke, the opinion notes, has brought forward no evidence that he satisfies either of these requirements.

Delving further into the legislative history, the opinion recites as a rubric of statutory interpretation that the Court interpret the Act "in light of the 'contemporary legal context' in which it was enacted -- that is, against the historical backdrop of the patent laws and the existing understanding of the language used in the act at the time," citing Cannon v. Univ. of Chicago, 441 U.S. 677, 698-99 (1979).  The opinion uses this rubric to interpret the "invents or discovers" language in the statute, stating that this phrase must be interpreted according to Supreme Court precedent to mean that:

[t]he beneficiary [of a patent] must be an inventor and he must have made a discovery. . . . [I]t is not enough that a thing shall be new, in the sense that in the shape or form in which it is produced shall not have been before known, and that it shall be useful, but it must, under the constitution and the statute, amount to an invention or discovery,"

(emphasis in opinion) citing Thompson v. Boisselier, 114 U.S. 1, 11 (1885).  And in turn, the Court opines that this requires the "exercise of the inventive faculty," citing Singer Mfg. Co. v. Cramer, 192 U.S. 265, 276 (1904); Pearce v. Mulford, 102 U.S. 112, 118 (1880); and Dann v. Johnson, 425 U.S. 219, 225 (1976) (and in a footnote cited cases of other Federal courts having language that "mere naked discovery" is not enough for a patent-eligible invention; these citations, as well as all but the Dann citation are directed towards utility patents, having been decided before the Plant Patent Act was enacted).

The opinion also has a citation to Ex parte Latimer, 1889 Dec. Comm'r Pat. 123, to support the proposition that prior to the Plant Patent Act, it was thought that plants were not patent-eligible per se as "products of nature."  This discussion serves as a segue to the Court's conclusion that Congress evinced an intent to extend patent protection to plant breeders while retaining the proscription against patenting naturally occurring plants, by recognizing that plants created by plant breeders showed the "exercise of the inventive faculty" and, as a consequence, that the patent could be bestowed only upon the inventor (seeming to incorporate by implication that the inventor must have "created" the new plant variety and not merely appreciated it).  This reading is supported by citations to the legislative history that support the "limited scope" of the Act.

The opinion then concedes that this requirement is not "explicitly stated in the statute," but supports its interpretation by citing statutory language that limits the scope to "cultivated sports, mutants and hybrids" (which seems to beg the question).  More relevant is citation to rejected amended provisions of the Act that would have included "found plants" expressly:

[T]he words "invented" and "discovered" as used in this section, in regard to asexually reproduced plants, shall be interpreted to include invention and discovery in the sense of finding a thing already existing and reproducing the same as well as in the sense of creating,

citing S. 3530, 71st Cong. (1930) (emphasis added); H.R. 9765, 71st Cong. (1930) (emphasis added).  And a similar provision was also stricken from the bill as first offered, based on an intention to "eliminate[] from the scope of the bill those wild varieties discovered by the plant explorer or other person who has in no way engaged in either plant cultivation or care and who has in no other way facilitated nature in the creation of a new and desirable variety," citing S. Rep. No. 71-315, at 7 (emphasis added).  Further citations to the record discuss the analogy between the plant breeder and the chemist, who both work with natural products but through inventive effort transform constituents of the natural world through the exercise of the "inventive faculty."  And this interpretation is also supported by language from the Supreme Court in Diamond v. Chakrabarty:

Thus, a new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter.  . . .  Such discoveries are "manifestations of . . . nature, free to all men and reserved exclusively to none,"

citing Funk Brothers Seed Co. v. Kalo Inoculant Co., 333 U.S. 127, 130 (1948), as well as the Chakrabarty court's discussion of the Plant Patent Act.  This construction is enough to defeat Beineke's claim under the Plant Patent Act as originally enacted in 1930:

In short, the provisions of the original 1930 Act, incorporated in the present plant patent statute, provided patent protection to only those plants (e.g., sports, mutants, and hybrids) that were created as a result of plant breeding or other agricultural and horticultural efforts and that were created by the inventor, that is, the one applying for the patent.  Beineke meets neither of these requirements.  Beineke does not argue that the oak trees were in any way the result of his creative efforts or indeed anyone's creative efforts, and thus they do not fall within the scope of those plants protected by the 1930 Act.

The panel also agreed that the 1954 amendments to the Act are also not sufficient to bring Beineke's activities (or trees) within the scope of the Act, because they are not the products of "newly found seedlings" which were first brought within the scope of the Act by these amendments.  Interestingly, the amendments are discussed in the opinion as a legislative override of an application of the law as stringently as the Court applies the Act here; however, in view of the fact that the amendments were limited to "newly found seedlings" this intention by Congress to expand the scope of the Act was of no help to Beineke.  And the opinion cites the legislative history of the 1954 amendments to support its view that Congress had no intention of changing the requirement in the 1930 Act that plants eligible for a plant patent must be "created" plants and not "found" plants.

The opinion's use of the Act's legislative history, while fully supporting the panel's decision, is curious in contrast with other recently decided cases.  For example, it is apparently unnecessary to consult the legislative history in view of the panel's interpretation of the claim language.  The statute is by its terms limited to "cultivated sports, mutants, hybrids, and newly found seedlings" and excludes, inter alia, "a plant found in an uncultivated state."  The white oak trees that are the subject of the two applications at issue would appear not to fall within the scope of a "cultivated sport[], mutant[], hybrid[, or] newly found seedling[]" except upon a reading that would include "a new plant found in the wild" contrary to the rubric recited in Chakrabarty.  (Indeed, it would be consistent with Judge Dyk's previously asserted opinion on the scope of patent-eligibility of natural products in Intervet v. Merial.)  Including the white oak trees at issue within the scope of the Plant Patent Act would also be contrary to the exclusion of "a plant found in an uncultivated state," again under any plain meaning analysis that did not reduce the term "cultivated" to a triviality.  Thus, recourse to the legislative history appears unnecessary.

It is also curious where, in other cases, Federal Circuit panels have refused to consider the legislative histories where such considerations may have been illuminative.  One such case is Momenta Pharmaceuticals, Inc. v. Amphastar Pharmaceuticals, Inc., where the panel majority (which included Judge Dyk) refused to consider the legislative history of provisions of the Hatch Waxman Act, specifically 35 U.S.C. § 271(e)(1), on the grounds that the plain meaning of the Act was sufficient.  (And in addition, that panel majority held that it would be improper to consult the legislative history under circumstances where the meaning of the statutory language was clear.)  This decision, both on the merits and the majority's decision not to consider the legislative history of the Hatch Waxman Act, was the subject of a vigorous dissent by Chief Judge Rader.

Comparison of these cases illuminates the inconsistency, that courts in their discretion can decide whether the "plain meaning" of statutory language is sufficient or if the legislative history need be consulted.  Because almost by definition reasonable people can differ on questions of statutory construction (else the exercise would be trivial), it would seem to be important to decide whether a court's construction of a statute is at least consistent with, if not mandated by, Congressional intent.  That may not be enough, of course; as the Supreme Court has recently instructed in National Federation of Independent Business et al. v. Sebelius et al.,  567 U.S. ___ (2012), courts should strike down laws enacted by Congress where "the lack of constitutional authority to pass [the] act in question is clearly demon­strated," citing United States v. Harris, 106 U. S. 629, 635 (1883).  Courts have the ability not only to strike down laws but also to interpret them so as to render them constitutional (which is arguably what the Supreme Court did in the National Federation case).

Discerning Congressional intent can be a difficult and uncertain task.  But it would appear prudent for courts to at least consider whether the legislative history need be considered, much like proper claim construction requires courts to review the specification if only to ascertain whether the patentee has disclaimed aspects of the claims that would otherwise fall under the plain meaning of claim terms.  If prudence counsels such consideration of intent, and evidence of intent, for claim construction (which is limited to private patent rights), a fortiori the same prudence should counsel that the legislative history be similarly consulted for construing statutes.  Not to do so raises the risk that statutory scope decisions are driven by the court's, not Congress', intent, something clearly outside our constitutional scheme.  Only if courts (and their judges) are aware of these risks can the consequences be avoided.

In re Beineke (Fed. Cir. 2012)
Panel: Circuit Judges Dyk, Schall, and Reyna
Opinion by Circuit Judge Dyk

Momenta Pharmaceuticals Inc. v. Amphastar Pharmaceuticals, Inc.: "The Rest of the Story"

By Kevin E. Noonan --

Judge Rader wrote a vigorous dissent to the panel majority's opinion in Momenta v. Amphastar, disagreeing with the panel majority's interpretation that the "safe harbor" embodied in 35 U.S.C. § 271(e)(1) extended to post-approval activities.  Before considering the substance of his dissenting opinion, the following facts should be remembered:

• First, Chief Judge Rader (at right) was a Senate staffer for Senator Orin Hatch and intimately involved in the legislative history of the Hatch-Waxman Act;

• Second, before he was Chief Judge, he wrote the Federal Circuit opinion in Merck v. Integra, which (like his dissent here) focused on Congress' intent in crafting the balanced Hatch-Waxman regime;

• Third, Chief Judge Rader joined with Judge Newman in the majority opinion in Classen Immunotherapies, Inc. v. Biogen IDEC, which came to precisely the opposite conclusion as to the scope of the safe harbor (i.e., that it does not extend to post-approval activity); and

• Fourth, Judge Moore wrote a spirited dissent to the majority opinion in Classen, based even more expressly than in the majority opinion here on her interpretation of the Supreme Court's Merck decision to mean that "the safe harbor extends to all uses that are reasonably related to submitting any information under the FDCA, including information regarding post-approval uses" (understandable in view of the typically broad language contained in Justice Scalia's opinion; see "Merck KGaA v. Integra Lifesciences I, Ltd. (2005)").

(And, as we will see in our discussion elsewhere of In re Beineke, the third member of the Momenta panel, Judge Dyk, can base his decisions on legislative history when it serves his purposes.)  Here, in his dissent, the Chief Judge turns again to the limited scope of the safe harbor, based on his understanding of the fundamental right to exclude embodied in the patent statute and the limited exception to that right granted under § 271(e)(1).  ("Thus, exceptions to the traditional property remedy amount to a get-out-of-jail-free card for the trespasser.  Accordingly, such exceptions must occur only sparingly with awareness that this license allows the wrongdoer free reign to continue trespassing.")  That limited scope is the result of a balance, expressly struck by Congress, between the recompense to patentees who lost patent term during regulatory review (comprising the patent term extension provisions of 35 U.S.C. § 156 et seq.) and the benefits to the public by legislative override of Roche Products, Inc. v. Bolar Pharmaceutical Co., 733 F.2d 858 (Fed. Cir. 1984) (preventing any infringing activity prior to patent expiration including activities required by the FDA or other government agencies for approval of drugs).

Here, despite a "strong incentive to invent the patented manufacturing method," Amphastar did not, according to the dissent -- Momenta did, and:

At that point, Amphastar stepped in and took Momenta's patented invention without permission and used it to manufacture each commercial batch it sells on the market.  Indeed Amphastar continues to trespass and promises to trespass for years to come.  In fact, as the court repeatedly acknowledges, Amphastar is only able to compete with Momenta by taking its patented invention.  Amphastar has not developed its own method, but instead delights in trespassing and refuses to pay a reasonable royalty to make the trespass lawful.

And, the Chief Judge says with some incredulity, "[t]his court would allow this arrogance to continue by expanding the limited reach of 35 U.S.C. § 271(e)(1)."  Further, he reminds his brother and sister that this decision "ignores the binding precedent of Classen Immunotherapies, Inc. v. Biogen IDEC."

In support for his dissent, Chief Judge Rader cites a relevant Supreme Court case, Eli Lilly & Co. v. Medtronic, Inc., 496 U.S. 661, 669 (1990), which was directed expressly to the scope of the safe harbor under § 271(e)(1) in deciding that it extended to medical devices, to reach the conclusion that the text of § 271(e)(1) can be "not plainly comprehensible."  This judicial recognition that the statute is not eminently clear justifies the Chief's resort to the legislative history (because, after all, the same language of the patent statute cannot be "not plainly comprehensible" some of the time and have a "plain meaning" at other times).  The dissent then sets forth extensive portions of that legislative history to illustrate Congressional intent:

The purpose of 271(e)(1) and (2) is to establish that experimentation with a patented drug product, when the purpose is to prepare for commercial activity which will begin after a valid patent expires, is not a patent infringement.  Since the Committee's Subcommittee on Health and the Environment began consideration of this bill, the Court of Appeals for the Federal Circuit held that this type of experimentation is infringement.  In Roche Products, Inc. v. Bolar Pharmaceutical Co., 733 F.2d 858 (Fed. Cir. 1984), the Court of Appeals for the Federal Circuit held that the expiration date of a patent claiming that drug product constitutes patent infringement, even though the only purpose of the experiments is to seek FDA approval for the commercial sale of the drug after the patent expires.  It is the Committee's view that experimental activity does not have any adverse economic impact on the patent owner's exclusivity during the life of a patent, but prevention of such activity would extend the patent owner's commercial exclusivity beyond the patent expiration date.

H.R. REP. NO. 98-857, pt. 1, at 45-46 (1984) (emphases added).  Remember, the Roche case had introduced a "lag in time" between patent expiry and generic drug market entry by prohibiting activities required by the FDA for generic drug approval.  Accordingly, Congress intended to remedy this situation, according to the Chief, by permitting the generic drug manufacturer to "conduct tests using [the patented drug] product if the purpose of those tests is to submit an application to FDA for approval," citing 130 CONG. REC. 23060 (1984) (statement of Rep. Robert W. Kastenmeier, Chairman of the Subcommittee on Courts, Civil Liberties and the Administration of Justice, Committee on the Judiciary) (emphasis added).  The dissent notes that this purpose was endorsed by groups having vastly different political agendas, namely the Pharmaceutical Manufacturers Association (PhRMA) and the Generic Pharmaceutical Industry Association (citing testimony before the House Judiciary Committee).  And insofar as it is relevant, the Reagan Administration not only supported the Act but advocated for "a more limited exception," although "it clearly understood the boundaries of [§ 271(e)(1)] to be pre-approval experimental use."

The point of this historical exercise is to make the case that "§ 271(e)(1) won approval because it was limited in time, quantity, and type: [f]irst, as to time, § 271(e)(1) only applies to pre-marketing approval; [s]econd, as to quantity and type, § 271(e)(1) only applies to experimentation -- and therefore would have limited impact on the patentee's exclusivity during the life of the patent."  Importantly, "the authors made clear that section 271(e)(1) would not apply to commercial sales, i.e., the 'infringing' product would not enter the market until after the patent's life" according to the dissent, citing H.R. REP. NO. 98-857, pt. 1, at 45 (1984) ("This section does not permit the commercial sale of a patented drug by the party using the drug to develop such information, but it does permit the commercial sale of research quantities of active ingredients to such party.") (emphasis added).  The dissenting opinion supported these points by extensive and specific citation to the Congressional record.

Nothing like the activities the majority permits Amphastar under its interpretation was intended by Congress and there is evidence in the record that Congress specifically intended that such an outcome not result from the Hatch Waxman Act, according to Chief Judge Rader:

Nowhere in the legislative history can this court find any suggestion that § 271(e)(1) would apply other than in the limited scenario of conducting de minimis experiments pre-approval (i.e., to obtain FDA approval).  Nowhere in the legislative history can this court find a hint that an "infringer" could continue to use its competitor's patented method in manufacture of each commercial batch for contemporaneous sale.  Nowhere in the legislative history can this court find any mention of the post-approval, continuous, commercial sales allowed by this decision.  Nowhere in the legislative history can this court find any suggestion that the mere maintenance or retention of information as part of a company's records is considered a submission that would trigger § 271(e)(1).  In fact, this court makes no attempt to examine the legislative history of this section at all -- a very telling silence.

And turning to the heart of the matter, the dissent notes that the majority avoids these considerations by dismissing them, deciding that because the majority can "find[] no ambiguity" there is no need to "find out the purpose of the section it distorts."  That "distortion" includes reading out of the statute the limitation that the permitted activities under the safe harbor are "solely" for developing and submitting information to the FDA, and in holding that a "submission" can include retaining manufacturing records (words that usually have opposing meanings, according to the Chief).  As a result:

This new interpretation would allow almost all activity by pharmaceutical companies to constitute "submission" and therefore justify a free license to trespass.  The FDA can inspect records of any drug manufacturer and seller.  See 21 U.S.C. § 374.  Thus, the drug manufacturer need only make a record, which could potentially be inspected by the FDA, and then any activity could satisfy this new meaning of "submission."

Turning to Classen, Chief Judge Rader notes that the Court has "already decided the meaning of this statute" not to encompass post-approval activities (based on the same considerations of the legislative history rejected by the majority here).  Amphastar's activities are antithetical to the Congressional intent according to the dissent because these activities are not "pre-approval" because they occur after Amphastar has obtained FDA approval; are not "limited because Amphastar uses Momenta's invention on a continuous basis in the manufacture of each commercial batch and during the life of Momenta's patent"; and are not "experimental because Amphastar uses Momenta's invention in manufacturing each commercial batch of its product for contemporaneous sale on the market (in commerce) to obtain profits and to compete with Momenta."  Accordingly, the majority's decision is directly contrary to binding precedent under Classen according to Chief Judge Rader.  He notes the analytical sleight of hand used by the majority to avoid the Classen precedent, and refutes the argument that the Classen decision was not based on the distinction between pre- and post-approval with quotes from Judge Moore's Classen dissent directed precisely to that specific point.  And the Chief's dissent frankly acknowledges the jurisprudential consequences:

This decision ("post-approval studies"; "after approval"; "not restricted to pre-approval activities") cannot be genuinely reconciled with Classen ("pre-marketing approval").  Instead, the court in this decision uses the same language as the dissent in Classen ("post-approval"; "I conclude that the safe harbor extends to all uses that are reasonably related to submitting any information under the FDCA, including information regarding post-approval uses").  This decision should instead request the entire court to resolve the issue en banc.

And the argument that the FDA mandates Amphastar to infringe are equally unavailing for Chief Judge Rader:

Momenta thus far has created and developed the only successful method by which one can show the FDA's requirement has been met.  Amphastar is free to invent its own method to satisfy these requirements.  Instead it chooses to trespass.  Because it has not ventured to find another way to perform these tests, it is unfair to suggest that Amphastar's hands are tied.

And, save for a discussion on the chimerical "tragedy of the anticommons" (discussed previously; see "Chief Judge Rader (Not Surprisingly) Gets it Right about Chimerical 'Tragedy of the Anti-Commons'"), Chief Judge Rader's dissent ends with his analysis of the Supreme Court's construction of § 271(e)(1) under Eli Lilly and Merck; in his reading, there is nothing inconsistent in these decisions with the conclusion that the safe harbor is limited to pre-approval activities.  He concludes:

Every day, Amphastar, a competitor of Momenta, is infringing Momenta's patent.  This decision allows that trespass.  Moreover, to reach that result, this court must ignore its own prior decision in Classen and the purpose of the statute explained in the legislative history.  Sadly this decision abrogates Momenta's hard-achieved property right and reallocates that entitlement to its competitors -- a sad day for property owners and an undeserved victory for those who decline to invest in the expense and difficulty of discovery and invention.

The principle that courts must interpret statutes "as they find them" (which forms one basis for the majority's decision) is certainly one of judicial parsimony.  However, Congress cannot be expected to write any but the simplest laws having the most limited scope in language that will clearly instruct judges how to apply it in every (in)conceivable situation.  This is a truth even more relevant to a statute like the Hatch-Waxman Act, which by its express language is crafted to strike a balance not only between competing interests but diverse laws (patent and regulatory).  Thus, it seems prudent that legislative history be considered, keeping in mind that the search will frequently be fruitless; it is rare when the policy considerations are as expressly recited in the record as they appear to be in Chief Judge Rader's recitation (and his personal involvement lends credence to his arguments).  In some ways this is analogous to claim construction, where prudence requires courts to review the specification if only to ascertain whether the patentee has disclaimed aspects of the claims that would otherwise fall under the plain meaning of claim terms.  And this is in a much more limited context, where the patentee is responsible for the scope of the claims and the extent of the disclosure supporting them.  Sage Products, Inc. v. Devon Industries, Inc., 126 F.3d 1420 (Fed. Cir. 1997).  As illustrated here (and perhaps in Merck), failure to consider express Congressional intent risks deciding contrary to that intent, and while Congress retains the capacity (theoretically) to rectify judicial misinterpretation, the inefficiencies of using this way of construing statutes does not seem to be balanced by any principled basis for taking statutes as a court finds them.  And refusing to consider express Congressional intent runs the risk of decisions being driven by the court's, not Congress', intent, something clearly outside our constitutional scheme.  And yet, under Chief Judge Rader's analysis that is exactly what happened here.  A decision on en banc review (if one is filed) might indicate whether the Court as a whole sees things with the Chief or the majority.

Alcon Research, Ltd. v. Apotex Inc. (Fed. Cir. 2012)

"This is not how patent law works."

By Andrew Williams --

Writing for the majority in Alcon Research, Ltd. v. Apotex Inc. last Wednesday, Judge Moore took issue with a position advanced by Alcon's counsel that would have essentially allowed a court to rewrite patent claims to preserve validity.  Because of that, in part, the Federal Circuit reversed a lower court's finding of non-obviousness with regard to six claims of the patent covering PANTANOL®.  However, because the Court affirmed the validity of two narrower dependent claims, Novartis' Alcon unit retained the ability to block generic competition of its anti-allergy eye-drops.

The technology at issue in the Alcon case was the drug product olopatadine, which is used in PANTANOL® to treat allergic eye disease in humans.  As background, antigens can cause the formation of antibodies in the body, and these antibodies can then bind to the surface of mast cells (which are specialized cells that are involved in the allergic reaction).  Such binding causes the sensitization of the mast cells, such that any subsequent antigen binding causes the cells to release chemical mediators, such as histamine and heparin.  To treat allergic reactions, anti-allergy drugs can interfere at multiple points in this process.  One such class of drugs is the mast cell stabilizers, which prevent the mast cells from releasing these mediators, thereby reducing the allergic symptoms.  In the human eye, mast cells are located in the membrane that covers the inner surface of the eyelid and the white part of the eyeball (the conjunctiva).

The drug product olopatadine was known in the prior art as an effective antihistamine, and chemicals related to olopatadine that were known to have mast cell stabilizing activity.  However, olopatadine was not known to stabilize mast cells.  Moreover, mast cells from different species, and even different tissue from the same species, can have different biological responses, referred to as mast-cell heterogeneity.  Therefore, even though the drug was already known in the art, Alcon's scientists were the first to show that olopatadine could stabilize conjunctival mast cells in humans using in vitro testing.  This work gave rise to U.S. Patent No. 5,641,805 ("the '805 patent"), which claimed methods for treating allergic eye diseases in humans by topically administering an olopatadine composition.  The claims of this patent required that this method be accomplished by stabilizing the conjuctival mast cells.  Alcon's PANTANOL® product is the commercial embodiment of the claims of the '805 patent.

The present action began when Apotex filed an ANDA seeking permission to sell a generic version of PANTANOL®, which included a Paragraph IV certification against the '805 patent.  In turn, Alcon sued Apotex in the Southern District of Indiana.  The lower court held that Apotex failed to establish by clear and convincing evidence that the claims of the '805 patent were obvious over the prior art.  One of the reasons was that, even though olopatadine was known to be an effective antihistamine, there were significant barriers to adapting a systemic antihistamine for topical use in the eyes.  In addition, the prior art did not teach that olopatadine could act as a mast cell stabilizer.  Finally, the lower court found that objective evidence of non-obviousness, including unexpected results, long-felt need, and commercial success, supported its holding.  Apotex appealed.

Claims 1-3 and 5-7 Were Obvious

The Federal Circuit disagreed with the lower court's determination that claims 1-3 and 5-7 were not obvious over the prior art.  The amount of administered olopatadine covered by the specific claims was important to this decision.  Independent claim 1 read:

1.  A method for treating allergic eye diseases in humans comprising stabilizing conjuctival mast cells by topically administering to the eye a composition comprising a therapeutically effective amount of 11-(3-dimethylaminopropylidene)-6,11-dihydrodibenz(b,e)oxepin-2-acetic acid or a pharmaceutically acceptable salt thereof.

(emphasis added).  The dependent claims specified the amount of administered olopatadine, ranging from about 0.0001% w/v to 5% w/v (claims 2 and 6) to about 0.001%  to about 0.2% w/v (claims 3 and 7).  The Federal Circuit reasoned that "a therapeutically effective amount" could not be a range less than 0.0001% w/v to 5% w/v, because a dependent claim cannot be broader than a claim from which it depends.  With regard to the range of administered olopatadine covered by the claims, Alcon's counsel took the position that the claims required that conjuctival mast cells be stabilized, and therefore any part of the range recited in the claim that does not operate to achieve this requirement would not fall within the scope of the claim.  Of course, as the Court pointed out, patent law does not work this way.  Instead, if you claim a range, and part of the range is inoperative (i.e., not enabled), you cannot later disavow the invalid portion.  "Courts do not rewrite the claims to narrow them for the patentee to cover only the valid portion."  Alcon, slip op. at 12.

With regard to the obviousness contentions, the main reference cited against these claims was the Kamei reference, which disclosed treating eye allergies in guinea pigs using olopatadine at concentrations ranging from 0.0001% w/v to 0.01% w/v.  This range overlapped the range of claims 1-3 and 5-7 of the '805 patent.  Therefore, the only question for the Federal Circuit was whether there was a motivation to adapt this teaching to a use for treating allergic eye disease in humans.  The Court found that the lower court erred by only looking to the '805 patent for this motivation.  Instead, the Federal Circuit found that such motivation existed because the guinea pig animal model was predictive of antihistaminic efficacy in humans (a fact found by the lower court).  The Federal Circuit did find that the lower court's determination that Kamei did not teach olopatadine as a mast cell stabilizer was not clear error, but nevertheless Kamei's teaching of the use of olopatadine with "overlapping concentrations, even if for a different purpose, meets these claim limitations," even without that teaching.

Important to the Court's analysis was the effect of the claim phrase:  "stabilizing conjuctival mast cells."  The lower court had construed this term to limit the claims to concentrations of olopatadine that so stabilize mast cells, and that are clinically relevant.  The Federal Circuit stated that it was not deciding whether this construction was correct.  However, as pointed out above, to the extent this construction allowed a disavowal of inoperative claim scope, the Court noted that this could not be correct.  In fact, the Federal Circuit's opinion essentially read this claim term out of the claim, because it found that it was not necessary for the prior art to teach this mast-cell stabilizing effect.  The reason provided was that the claim language did not impose any additional requirements beyond the cited range of administered olopatadine because the '805 patent taught that mast cell stabilization necessarily occurred at the claimed concentrations.  This allowed the Court to side-step the issue of whether an inherent property of the prior art could be used in an obviousness determination.  This was analogized to the situation in In re Kubin, 561 F.3d 1351 (Fed. Cir. 2009).  In that case, the applicants were attempting to claim an isolated nucleic acid molecule that encoded the Natural Killer Cell Activation Inducing Ligand ("NAIL").  However, the claim also included the limitation that the polypeptide bind CD48, which was not known in the prior art:

73.  An isolated nucleic acid molecule comprising a polynucleotide encoding a polypeptide at least 80% identical to amino acids 22-221 of SEQ ID NO:2, wherein the polypeptide binds CD48.

Nevertheless, because the patent application in Kubin explained that CD48 binding was an inherent property of NAIL, the prior art's failure to mention this was irrelevant to a finding that the claim was obvious.

The Federal Circuit stressed the point that these cases did not implicate inherency.  However, if a property is not taught in the prior art, but the patent teaches that this property is necessarily present, it is unclear how this is different than inherency.  The distinction that the Court made -- that it was the patent that taught the inherent property -- does not appear to be relevant.  The problem that the Court faced was in acknowledging that the property was inherent, they would have to acknowledge that this was a case of inherent obviousness -- something that the Federal Circuit does not like to do.

Claims 4 and 8 Affirmed as Non-obvious

With regard to the remaining two claims, claims 4 and 8, the Federal Circuit found that Kamei could not be used to render them obvious.  Both of these claims required the administration of olopatadine at a concentration of 0.1% w/v.  Kamei only tested olopatadine to a concentration of 0.01% w/v.  The Federal Circuit could not say that the lower court erred in finding that Kamei did not teach or suggest the higher concentration.  Apotex had also argued that a second reference, Lever, taught the use of a different ophthalmic formation at the concentration or 0.1% w/v.  However, a person of ordinary skill would not assume that you could simply substitute active ingredients in a formulation without adjusting concentrations.  Finally, PANTANOL® achieved nearly 70% market share within two years, and therefore the finding of commercial success was not clearly erroneous.  At the end of the day, therefore, Alcon was left with two valid claims, and as a result, Apotex will not be able to receive approval to market a generic version of PANTANOL® before the expiration of the '805 patent.

Alcon Research, Ltd. v. Apotex Inc. (Fed. Cir. 2012)
Panel: Circuit Judges Prost, Moore, and O'Malley
Opinion by Circuit Judge Moore