Patent Docs

USPTO Director Addresses U.S. Patent System's Decline in U.S. Chamber of Commerce Worldwide Patent Protection Rankings

By James Korenchan --

At the U.S. Chamber of Commerce Patent Policy Conference last month, U.S. Patent and Trademark Office (USPTO) Director Andrei Iancu (at right) gave a keynote address on the role of U.S. patent policy in domestic innovation and the potential impacts on investment towards the advancement of science and technology.  The primary goals of the address was to address the results of the U.S. Chamber of Commerce's 5th annual study on worldwide intellectual property systems.  The study dropped the U.S. patent system to 13th in the world, thereby extending the U.S.'s decline since 2016 (in 2016, the U.S. was ranked 1st, and then ranked 10th in 2017).  Further, the study attributed the decline to weak and uncertain patentability standards -- particularly those surrounding subject matter eligibility -- as well as to weak patent opposition procedures established by the America Invents Act (AIA). 

Iancu's address, which was unsurprisingly bookended and peppered with emphases on the ongoing importance of the U.S. patent system in innovation and economic growth, first acknowledged the substantial changes to the U.S. patent system over the past few years.  "Importantly," he added, "the rhetoric surrounding the patent system has focused relentlessly on certain faults in, or abuses of, the system—instead of the incredible benefits the system brings to our nation."

Iancu then laid out a two-point plan to reverse the U.S.'s downward trend and reinvigorate the role of the U.S. patent system in the economy.  First, he aims to draw focus away from the skepticism of IP rights and the faults of the U.S. patent system and instead create "a new pro-innovation, pro-IP dialogue":

A successful system cannot be defined by its faults.  Rather, a successful system must be defined by its goals, aspirations, and successes.  Obviously, errors in the system should be corrected.  And no abuse should be tolerated.  Errors and abuse should be identified and swiftly eliminated.  However, the focus for discussion, and the focus for IP policy, must be on the positive.  We must create a new narrative that defines the patent system by the brilliance of inventors, the excitement of invention, and the incredible benefits they bring to society.  And it is these benefits that must drive our patent policies.  . . .  Here's a start:  when we write, interpret, and administer patent laws, we must consistently ask ourselves "Are we helping these inventors?"  Whether it's an individual tinkering in her garage, or a team at a large corporation, or a laboratory on a university campus, we must ask ourselves "Are we helping them? Are we incentivizing innovation?"

This led into Iancu's second point:  To increase the reliability of granted patents, giving applicants more confidence in seeking to protect their inventions and giving patent owners more confidence in the rights they hold.

Iancu followed with certainly the most stimulating remarks of the address, where Iancu acknowledged the unpredictability and frustration with subject matter eligibility analysis under 35 U.S.C. § 101.

First, our current law surrounding patentable subject matter has created a more unpredictable patent landscape that is hurting innovation and, consequently, investment and job creation.  Recent cases from the Supreme Court -- Mayo, Myriad, and Alice -- have inserted standards into our interpretation of the statute that are difficult to follow.  Lower courts applying these cases are struggling to issue consistent results.  Patent lawyers trying to advise their clients are, in turn, struggling to predict the outcome with respect to certain patents.  And examiners at the USPTO must spend increased amounts of time addressing this challenging issue.  The current standards are difficult for all:  stakeholders, courts, examiners, practitioners, and investors alike.  System-wide, a significant amount of time is being spent trying to figure out where the lines should be drawn.  . . .  Something must be done.

While we might not be able to rest assured just yet, Iancu stressed that, while faithfully applying the law, the USPTO will do more within the bounds of the statute to increase the clarity and predictability of eligibility analyses and outcomes.  "Currently," he said, "we're actively looking for ways to simplify the eligibility determination for our examiners through forward-looking guidance.  Through our administration of the patent laws, which we are charged to execute, the USPTO can lead, not just react to, every new case the courts issue."

Iancu then turned to patent opposition procedures, primarily Inter Partes Review (IPR).  (Note:  Since giving this address, the Supreme Court held in a 7-2 decision in Oil States v. Greene's Energy that IPR proceedings do not violate Article III or the Seventh Amendment of the Constitution.)

Acknowledging the popularity of IPR proceedings since the AIA ("more than 8,000 such proceedings"), Iancu also acknowledged the divisiveness surrounding the IPR system:  

Pointing to the high invalidation rates in IPR proceedings, some hate the new system with vigor, arguing that it's an unfair process that tilts too much in favor of the petitioner.  Others love the system, and think it's the best tool we have to correct errors, eliminate "bad patents," and improve patent quality.  Who is right?  Well, both arguments have legitimate elements.  But I encourage people to reduce the hyperbole and look at the process with fresh eyes, in order to understand its true benefits and true challenges.

Further, Iancu called this understanding of IPR proceedings "one of [the USPTO's] highest priorities," as well as achieving balance between the interests of both petitioners and challengers.  "And so," he said, "among various other things, we are now examining:  how and when we institute proceedings, the standards we employ during the proceedings, and how we conduct the overall proceedings.  The goal, with whatever action we take, is to increase predictability of appropriately-scoped claims."

Not stopping there, Iancu next stressed that, to further increase the reliability of patent rights, the USPTO needs to issue "appropriately-scoped patent claims from the get-go."  To do this, he seeks to ensure that examiners are properly-equipped with the guidance and search tools needed to improve the initial examination.  Iancu hopes that this will in turn reduce the gap between prior art found during initial examination and prior art found during litigation and improve the U.S. patent system as a whole.   

Near the end of his address, Iancu again stressed the importance of the U.S. patent system and quoted the co-founder of SanDisk, Dr. Eli Harari, who is credited with the invention of Electrically Erasable Programmable Read-Only Memory (EEPROM) and perfection of flash memory data storage:

"If you are not protected," [Dr. Harari] said, "God help you!"

The benefits of an increased reliability in obtaining and holding patent rights are clear.  And as stimulating as some of Iancu's remarks may be, we can only wait and see whether he delivers on his ambitions. 

USPTO Proposes Harmonizing Claim Construction Standard In PTAB Proceedings

By Andrew Williams --

The U.S. Patent and Trademark Office published a notice of proposed Rulemaking in the Federal Register (83 Fed. Reg. 21221) today which would provide a change to the claim construction standard used in Inter Partes Reviews (IPRs), Post-Grant Proceedings (PGRs), and Covered Business Method Reviews (CBMs).  Instead of the broadest reasonable interpretation ("BRI") standard originally adopted, and blessed by the Supreme Court in Cuozzo Speed Technologies LLC v. Lee, the proposed rulemaking would adopt the same standard used by district courts and the ITC.  The use of a harmonized standard has been long advocated by patent holders, specifically because they are faced with an unfair dichotomy -- a more stringent construction when alleging infringement, but a broader construction when faced with an allegation of unpatentability at the PTAB.  Or, as the Office acknowledged in the notice, it is possible that "even if a competitor's product would not be found to infringe a patent claim if it was sold after the patent's effective filing date, the same product nevertheless could constitute invaliding prior art if publically sold before the patent's effective filing date."  Nevertheless, over time, the BRI standard for post-issuance proceedings has been refined by the Federal Circuit to the extent that it was almost approaching the Phillips standard anyway.  In fact, cases in which the claim construction standard has been outcome determinative are few and far between.  Still, this effort to harmonize the construction of issued claims regardless of which tribunal is considering the issue is welcome and long overdue.

Specifically, the Patent Office is proposing amending 37 C.F.R. §§ 42.100(b), 42.200(b), and 42.300(b) to replace the first sentence with the following:  "a claim of a patent, or a claim proposed in a motion to amend, 'shall be construed using the same claim construction standard that would be used to construe such claim in a civil action to invalidate a patent under 35 U.S.C. 282(b), including construing the claim in accordance with the ordinary and customary meaning of such claim as understood by one of ordinary skill in the art and the prosecution history pertaining to the patent.'"  The Office, in other words, would begin applying the principles that were articulated by the Federal Circuit in Phillips and its progeny.  This would include taking into account the claim language, the specification, and the prosecution history (including any other post-issuance proceeding), as well as relevant extrinsic evidence.  Moreover, the Office is proposing amending each of these sections to add the following sentence:  "Any prior claim construction determination concerning a term of the claim in a civil action, or a proceeding before the International Trade Commission, that is timely made of record in the . . . proceeding will be considered."  Finally, the Office proposes removing the language for a different standard for claims in an expired (or expiring) patent because there would no longer be a need for a distinction.  Importantly, these proposed rule changes "would be applied to all pending IPR, PGR, and CBM proceedings before the PTAB."  As a result, practitioners with pending proceedings will likely need to account for the two different standards during the transition.

One of the stated reasons for this change was the goal of implementing "a fair and balanced approach, providing greater predictability and certainty in the patent system."  In making this claim, the Board pointed to PPC Broadband, Inc. v. Corning Optical Comm'ns RF, LLC, 815 F.3d 734 (Fed. Cir. 2016).  In that case, the Court noted that it "hinge[d] on the claim construction standard applied—a scenario likely to arise with frequency.  And in this case, the claim construction standard is outcome determinative."  Id. at 740-42.  Nevertheless, it is unclear how frequent such cases have been, as there were very few (if any) subsequent cases decided by the Federal Circuit that had such an outcome.  In fact, over time, the two standards seemed to be converging.  It began with the admonition in Microsoft Corp. v. Proxyconn, Inc., in which the Federal Circuit pointed out that a BRI construction still had to be that -- reasonable.  In fact, the Court warned in Trivascular, Inc. v. Samuels in February of 2016 that the PTAB does not have an "unfettered license" to construe claims inconsistent with the specification and prosecution history.  Instead, the Court concluded that any construction must reflect the "ordinary" and "customary" meaning of the terms as understood by those skilled in the art.  Clearly, by this point, the two different standards were already appearing to be not as far apart as originally feared.

For those wishing to submit comments, the deadline is July 9, 2018.  Comments can be sent via e-mail to [email protected], or they can be sent via the Federal eRulemaking Portal at http://www.regulations.gov.  All such submitted comments should include the docket number (PTO-P-2018-0036).  Comments can also be submitted by postal mail, but the Office would prefer electronic submissions to more easily share the comments.  The Notice also provides that if further information is required, please contact Michael Tierney and Jacqueline Wright Bonilla, Vice Chief Administrative Patent Judges, by telephone at (571) 272-9797.  And, of course, we will monitor comments and provide updates as warranted.

Considerations for Canna-Patent Owners and Applicants in Light of Insys Development Co. v. GW Pharma Ltd.

By George "Trey" Lyons, III, Nicole Grimm, and Brett Scott --

For companies in the cannabis industry seeking to protect their innovations, patent protection is typically available for cannabis-related inventions (including the plant itself), just like it is for any other invention—they just have to be new, useful, and nonobvious.  Many canna-patent owners understand and are concerned with the uncertainty they currently face in U.S. courts for enforcing their rights on a potential infringer—namely whether U.S. courts will enforce these patents given that cannabis is still federally classified as a controlled substance.  But to date there have been no cannabis-related patent infringement cases that have gotten far enough in district court to indicate how courts will treat these cases.

One area that seems to be outpacing U.S. courts, and one that canna-patent owners should be aware of, is the possibility of challenging the validity of the patent itself via post-grant proceedings before the U.S. Patent and Trademark Office.  Of particular note are inter partes review (IPR) proceedings before the Patent Trial and Appeal Board (PTAB), in which any third party can file a petition to institute, provided that they have not previously challenged the validity of the patent in a declaratory judgement action or have been served with a complaint alleging infringement more than a year prior to the PTAB challenge.  In essence, this party (referred to as the "petitioner"), makes a case before the PTAB that the USPTO should have never issued the patent in the first place because it is not new or nonobvious in the face of other preemptive ("prior art") patents and printed publications (e.g., technical documents, trade papers, etc.).  In this way, the petitioner can only challenge a patent in an IPR on grounds of anticipation under 35 U.S.C. § 102 or obviousness under 35 U.S.C. § 103.  If a petitioner is successful in invalidating one or more claims in a patent in an IPR proceeding, the scope of the canna-patent owner's right to exclude others from practicing the patented invention will be reduced or lost entirely.[1] 

On this point, the PTAB recently conducted a trial and heard oral arguments from a canna-patent owner and a party seeking to invalidate that patent in a cannabis IPR currently pending before the PTAB.  Specifically, IPR2017-00503 (previously flagged here) involves one of GW Pharma's patents related to treating seizures with cannabidiol (CBD), the non-psychoactive cannabinoid found in the cannabis plant.  GW Pharma is a British biopharmaceutical company known for its cannabis-based products, which it protects, in part, with its large cannabis-related patent portfolio (comprising around 100 patents and published applications in the U.S. alone), many of which are directed to treating diseases with cannabis-based compounds.  GW Pharma is also currently pursuing FDA approval for its cannabinol drug for treatment of seizures and is well on its way to having the first drug derived from the cannabis plant approved in the U.S.

Turning to the petition originally filed in this case, on December 16, 2016, Insys Development Company, Inc., a pharmaceutical company that focuses on cannabinoids, filed a petition to cancel all thirteen claims of U.S. Patent No. 9,066,920 ("the '920 patent," entitled "Use of One or a Combination of Pyto-Cannabinoids in the Treatment of Epilepsy") for obviousness based on three different combinations of several different references.

Claim 1 of the '920 patent (the only independent claim) is directed to "[a] method of treating partial seizure comprising administering cannabidiol (CBD), to a patient wherein the CBD is present in an amount which provides a daily dose of at least 400 mg."  In its preliminary response, GW Pharma asserted that a person of ordinary skill in the art at the time of invention would not have been motivated to increase the dosage of CBD taught by one of the primary prior art references and would not have had a reasonable expectation that higher CBD dosages would treat partial seizures.

Nevertheless, the PTAB instituted the IPR of the '920 patent on July 7, 2017, finding that Insys had established a reasonable likelihood that it would prevail in showing that claim 1 was unpatentable based on two of the three asserted combination of references.  The PTAB recently modified its institution decision in light of the Supreme Court's April 24, 2018 decision in SAS Inst., Inc. v. Iancu, to institute on all of the grounds presented in Insys' Petition that each address all of the challenged claims.  Absent further briefing on this subject, a final determination (known as a "Final Written Decision") is expected from the PTAB by July 7, 2018—the one-year statutory deadline for the decision (although that deadline may be extended by up to six months in view of the Supreme Court-mandated change in PTAB practice regarding partial institution decisions).

While many in the cannabis industry wait for the PTAB's determination in this IPR, the broader, but perhaps more subtle, implications of this IPR are worth carefully examining in the meantime, as they exemplify the unique issues for challenging and enforcing patents in this space.

First, although enforcement of cannabis patents seems uncertain in U.S. courts, what does seem clear based on the PTAB's institution of this case is that cannabis patents can be challenged via IPR proceedings.  Perhaps this is unsurprising given the USPTO's historic willingness to examine and grant cannabis patents despite the plant's current classification as a Schedule I narcotic; but it does present a mechanism for challenging the patent itself (an enforcement strategy in its own right) via a quasi-judicial proceeding.  And nothing seems to be barring challengers from bringing other USPTO post-grant proceedings to bring future canna-patent challenges.

Second, as we've previously analyzed with regards to Biotech Institute's patents, finding prior art that can be used to petition IPR of patents directed to the chemical makeup of cannabis plants may prove difficult, as such publications do not seem readily available and would be the only path to substantiating an IPR (short of a patent or patent application directed to the same).  But with regard to patents directed to methods of treatment using cannabinoids (e.g., the '920 patent), there are likely far more research-based scientific publications and patents available to third parties to initiate such challenges.  Therefore, the industry may see more challenges to cannabis patents surrounding the plant (e.g., growth, cannabinoid compounds, uses, etc.) as opposed to patents directed to the plant itself.

Third, if viewed myopically, this case presents what many may see as yet another challenge (and potential disadvantage) to canna-patent owners and applicants in the current legal landscape.  Specifically, at first blush it may seem, as Justice Gorsuch recently quipped in Oil States, that after "much hard work and no little investment . . . you endure the [] cost and effort of applying for [and being granted] . . . [a] patent that affords you exclusive rights to the fruits of your labor for two decades . . . [only to have] someone later emerge[] from the woodwork, arguing that it was all a mistake and your patent should be canceled" via an IPR—all without any certainty that you would be able to even enforce that patent in U.S. courts.  And this scenario potentially presents a unique challenge to canna-patent owners because if U.S. courts begin declining to hear cannabis patent infringement cases, then an unfortunate circumstance may arise where cannabis patents are challenged and invalidated via an IPR without the owner's ability to ever enforce them in U.S. courts.  But all is not lost because, like any other industry, if the canna-patent can withstand an IPR challenge, the value created for the owner is tremendous.  For example, surviving an IPR strengthens the patent itself by proving its validity over the challenging references, and also demonstrates the canna-patent owner's commitment to protecting their intellectual property, which can add leverage value when attempting to license patents.

Fourth, and finally, the very existence of the PTAB's willingness to engage in IPRs such as IPR2017-00503 presents further confirmation for everyone participating in the canna-patent process (e.g., judges, attorneys, examiners, etc.) that the property rights bestowed in canna-patents are no different than those created in any other patent.  In turn, canna-patents, like the cannabis industry as a whole, will continue to normalize in the American judiciary (as it has in the American psyche)—and, hopefully, some of these recurring challenges will be alleviated along the way.

And the takeaway for canna-patent owners and applicants moving forward should remain unchanged.  Obtaining canna-patents is still highly valuable for companies in this industry and will serve as irreplaceable stakeholders in this ever-normalizing and expanding market.

[1] And, although a controversial subject to many, the Supreme Court recently confirmed the constitutionality of IPRs in Oil States Energy Services, LLC v. Greene's Energy Group, LLC.

General Hospital Corp. v. Sienna Biopharmaceuticals, Inc. (Fed. Cir. 2018)

By Kevin E. Noonan --

The application of the written description requirement under 35 U.S.C. § 112(a) with regard to disclosed ranges is not always entirely straightforward or intuitively obvious, and this can particularly be the case when the question is involved with another notoriously arcane species of patent law, interferences.  (Interference practice was abolished, to the joy of many, with passage of the Leahy-Smith America Invents Act in 2012.)  Whether claims designated as corresponding to a count in an interference satisfy the written description requirement is a threshold issue which can lead to the interference being dismissed without the Patent Trial and Appeal Board (PTAB) rendering a decision on which claimant has proper priority, as well as finding said claims invalid.  Such was the decision against an applicant who had provoked an interference against claims of a granted patent, in General Hospital Corp. v. Sienna Biopharmaceuticals, Inc., where the Federal Circuit in a precedential decision took the opportunity to reiterate the proper application of this requirement to the claims at issue and overturn the Patent Office's decision to terminate the interference.

The appeal arose over interference proceedings provoked by GHS between its U.S. Application No. 13/789,575 and Sienna's U.S. Patent No. 8,821,941.  The PTAB dismissed the interference on the grounds that GHC's claims failed to satisfy the written description requirement under 35 U.S.C. § 112(a) under § 41.202(a).  The technology at issue involved hair removal using nanoparticles to damage hair follicles.  The interference was declared on the basis of claim 1 of the '941 patent as the only count:

1.  A method of localizing thermal damage to a hair follicle, comprising: applying a composition to a skin surface, wherein said composition comprises a plurality of unassembled plasmonic nanoparticles, wherein the unassembled plasmonic nanoparticles comprise a conductive metal portion, wherein the conductive metal portion comprises at least one of gold or silver, wherein the unassembled plasmonic nanoparticles have a size in a range of 10 nm to 300 nm, wherein the unassembled plasmonic nanoparticles comprise a coating that coats the conductive metal portion, wherein said coating facilitates selective removal from the skin surface; wherein the coating comprises at least one of silica or polyethylene glycol (PEG), wherein the unassembled plasmonic nanoparticles have a concentration of 10⁹ to 10²³ particles per ml of the composition, wherein said concentration is sufficient to, after exposure to irradiation, induce thermal damage in the hair follicle; distributing the composition from the skin surface to the hair follicle to target the hair follicle; selectively removing the composition from the skin surface, while leaving the composition localized within the hair follicle; and irradiating the composition with an infrared light source thereby inducing a plurality of surface plasmons in said unassembled plasmonic nanoparticles, wherein the induction of the surface plasmons generates thermal damage to the hair follicle for at least one of hair removal or hair growth reduction.

(the limitation relevant to the issues before the Court is italicized).  Among the claims of Sienna's application corresponding to the count is claim 65:

65.  A method of localizing thermal damage to a hair follicle, comprising:
    applying a composition to a skin surface
    wherein said composition comprises a plurality of unassembled plasmonic nanoparticles,
    wherein the unassembled plasmonic nanoparticles comprise a conductive metal portion,
    wherein the conductive metal portion comprised gold,
    wherein the unassembled plasmonic nanoparticles have a diameter of about 150 nm,
    wherein the unassembled plasmonic nanoparticles comprise a coating that coats the conductive metal portion, wherein said coating facilitates selective removal from the skin surface,
    wherein the coating comprises polyethylene glycol (PEG),
    wherein the unassembled plasmonic nanoparticles have a concentration of about 6.6 x 10¹¹ particles per ml of the composition, wherein said concentration is sufficient to, after exposure to irradiation, induce thermal damage in the hair follicle;
    distributing the composition from the skin surface to the hair follicle to target the hair follicle;
    selectively removing the composition from the skin surface, while leaving the composition localized within the hair follicle; and
    irradiating the composition with an infrared light source thereby inducing a plurality of surface plasmons in said unassembled plasmonic nanoparticles,
    wherein the induction of the surface plasmons generated thermal damage to the hair follicle for at least one of hair removal or hair growth reduction.

(as with Sienna's claim, the limitation relevant to the issues before the Court is italicized).

The Board construed the word "about" in GHC's claims to mean "within 10%" of the value recited, equivalent to between 5.94 x 10¹¹ and 7.26 x 10¹¹ particles per mL of the composition, under which construction Sienna argued the claims failed to satisfy the written description requirement.  The specification of GHC's '575 application defined nanoparticle concentration with regard to optical density rather than in particles per mL.  Under the conversion coefficient proffered by Sienna's expert and accepted by the Board, there was no disclosure in GHC's '575 application of nanoparticle concentrations between 5.94 x 10¹¹ and 7.26 x 10¹¹ particles per mL of the composition.  Hence, the Board found  GHC's claims corresponding to the count to be unpatentable for failure to satisfy the written description requirement.

GHC also moved the Board for leave to add a new claim that would fall within the scope of the count in the interference.  The Board denied this motion because GHC failed to show that there was an interference-in-fact between the claims, and for failing to provide evidence that this claim was patentable.

The Federal Circuit vacated the Board's decision to terminate the interference in a decision by Judge Moore, joined by Judges Reyna and Taranto.  With regard to its written description decision, the Court affirmed the Board's construction of the term "about," reviewing claim construction de novo and the factual question of whether GHC's claims satisfied the written description requirement for substantial evidence.  In applying the written description requirement, the panel noted that GHC's claims-in-interference were not original claims (and thus, albeit unspoken, recognized that these claims were not entitled to the presumption that original claims get that they satisfy the written description requirement).  Converting GHC's disclosure into nanoparticles per mL the Board found that GHC's specification disclosed species having "4.10 x 10¹¹, 4.46 x 10¹¹, 7.77 x 10¹¹, 8.44 x 10¹¹, 9.32 x 10¹¹, 22 x 10¹¹, and 24 x 10¹¹ [nano]particles per ml."  Citing Purdue Pharma L.P. v. Faulding Inc., 230 F.3d 1320, 1323 (Fed. Cir. 2000), the panel noted that "[t]he disclosure of a broad range of values does not by itself provide written description support for a particular value within that range.  Instead, where a specification discloses a broad range of values and a value within that range is claimed, the disclosure must allow one skilled in the art to 'immediately discern the limitation at issue in the claims.'"  In this case, the panel stated that GHC's specification disclosed a minimum concentration of 1 x 10¹¹ nanoparticles per mL and no maximum concentration other than "some value greater than 9.31 x 10¹¹ nanoparticles per ml" (with, as set forth above, some specific values even greater than that).  This is not enough to satisfy the written description requirement, however, because (again citing Purdue Pharma, "'one cannot disclose a forest in the original application, and then pick a tree out of the forest and say here is my invention.'"  And even though there was "minimal overlap[]" between the range claimed in Sienna's claims and the range disclosed in GHC's specification this also was not enough, the panel citing  analogous facts in Eiselstein v. Frank, 52 F.3d 1035, 1040 (Fed. Cir. 1995), in support of its conclusion.

The Board erred however, according to the Federal Circuit, by denying GHC's motion to add a claim corresponding to the count.  This decision was arbitrary and capricious because the Board "did not engage in a substantive analysis of the claim's patentability or identify any particular ground on which GHC failed to establish patentability."  Pursuant to the Board's Standing Order (SO) governing interferences, the panel held that GHC had made the required certifications that its new claim was patentable.  The Board did not identify any inconsistency from the prosecution history upon which to base its unpatentability determination to the contrary, as required by the SO.  The Court also found error in the Board's finding regarding there being no interference-in-fact, based on the principle that "[w]here a prior art patent discloses a range of values, showing a claimed value falls within that range meets a party's burden of establishing the narrower claim would have been obvious where there is no reason to think the result would be unpredictable," citing Galderma Labs., L.P. v. Tolmar, Inc., 737 F.3d 731, 738 (Fed. Cir. 2013); Alcon Research, Ltd. v. Apotex Inc., 687 F.3d 1362, 1368 (Fed. Cir. 2012); In re Applied Materials, Inc., 692 F.2d 1289, 1295 (Fed. Cir. 2012); and In re Peterson, 315 F.3d 1325, 1330 (Fed. Cir. 2003).  "It is not disputed that the values in the proposed claim fall within the ranges in claim 1 of the '941 patent.  Under the circumstances of this case, GHC has put forth sufficient evidence to establish proposed claim 74 would have been rendered obvious by claim 1 of the '941 patent," the panel concluded.  Thus the matter was remanded to the Board for continued interference proceedings, depending on whether the panel can find a basis for deciding that the new claim is patentable to GHC.

General Hospital Corp. v. Sienna Biopharmaceuticals, Inc. (Fed. Cir. 2018)
Panel: Circuit Judges Moore, Reyna, and Taranto
Opinion by Circuit Judge Moore

In re Eberra (Fed. Cir. 2018)

Purely Business Method Patent Found Ineligible under Section 101

By Joseph Herndon --

In an appeal from a rejection in initial examination of appellant Mark Eberra's patent application, the Federal Circuit affirmed the Patent Trial and Appeal Board's ("Board") determination that the claims are patent-ineligible under § 101.

The patent application is entitled "Business Method for Opening and Operating a National Television Network" with serial number 12/230,058 ("the '058 application").  The Examiner rejected all claims of the '058 application as patent-ineligible under 35 U.S.C. § 101 and as anticipated under 35 U.S.C. § 102.

The Board initially affirmed the Examiner's anticipation rejection without reaching the § 101 issue.  Then, on rehearing, the Board affirmed the Examiner's rejection under both § 101 and § 102.  Mr. Eberra appealed and represented himself pro se.

The '058 application describes a business method for providing a television network "that requires the masses of the general public to purchase products in exchange for being allowed to perform in television programs shown on the network."  Claim 1, which the Board treated as exemplary, reads:

1.  A process for providing a television network comprising:
    (a) opening at least one physical location for a production of a television program;
    (b) requiring at least one customer to make a purchase of a product;
    (c) allowing said customer to give a performance in said production of said television program, in exchange for making said purchase of said product;
    whereby said purchase made by said customer results in said production of said television program for said performance of said customer on said television network.

To determine whether a claim is patentable under § 101, the Supreme Court has instructed use of a two-step framework.  First, a court must determine whether the claim is directed to a patent-ineligible concept, i.e., a law of nature, a natural phenomenon, or an abstract idea.  If so, the court must proceed to step two and ask whether the elements of the claim, considered both individually and as an ordered combination, add enough to transform the nature of the claim into a patent-eligible application.

Starting at step one of the test, the Federal Circuit agreed with the Board's conclusion that the claims at issue are directed to an abstract idea, namely "promoting the purchase of a product with the incentive being a spot in a television program, i.e. product promotion."

Like the concept of risk hedging, which the Supreme Court found to be an abstract idea in Bilski v. Kappos, the Federal Circuit found that the concept of product promotion is a fundamental economic practice long prevalent in our system of commerce.

The Appellant argued that the claims are not directed to the abstract idea of product promotion and are instead directed to what the specification describes as a "new Customercast model of television" in which "the basic principle is to attract large numbers of people to perform on television, and require a purchase for the experience."  But the Federal Circuit found that the abstract nature of the claims is not altered at step one by the existence of claim limitations (much less characterizations in the specification) that add a degree of particularity to the implementation of the abstract idea.

Here, claim 1, considered as an ordered combination, simply describes a form of product promotion in which the incentive for purchasing a product is the opportunity to perform in a television program.  The Federal Circuit noted that this is more specific than the concept of product promotion, but it is no less abstract.

Turning to step two, each specific step in the claims—opening a location (which requires nothing more than finding a location), requiring a purchase, and allowing a performance in a television program—was found to be a routine television-production or advertising activity performed in a conventional way, as described in the specification.  Thus, there was no inventive concept found, and the claims in the '058 application were found to not be directed toward patentable subject matter under § 101.

Because the Court affirmed the Board's determination that the claims are patent-ineligible under § 101, they did not address the Board's decision with respect to anticipation.

In re Eberra (Fed. Cir. 2018)
Nonprecedential disposition
Panel: Chief Judge Prost and Circuiot Judges Dyk and O'Malley
Per curiam opinion

Conference & CLE Calendar

May 8, 2018 - Symposium on Intellectual Property (George Washington University Law School, Pillsbury, NERA Economic Consulting, and Mayer Brown) - Washington, DC

May 8, 2018 - "Intellectual Property Valuation and Damages: Nuts and Bolts in 2018" (The Knowledge Group) - 12:00 to 1:30 pm (ET)

May 8, 2018 - Patent Quality Chat webinar - "Subject Matter Eligibility: Revised Guidance in view of Berkheimer v. HP, Inc." (U.S. Patent and Trademark Office) - 12:00 to 1:00 pm (ET)

May 8-10, 2018 - Patent Fundamentals Bootcamp 2018: An Introduction to Patent Drafting, Prosecution, and Litigation (Practising Law Institute) - Chicago, IL

May 9, 2018 - "Supplemental Examination Requests: Benefits and Limitations, Strategic Use -- Assessing Enforceability of Patent Portfolios, Evaluating the High Burden" (Strafford) - 1:00 to 2:30 pm (EDT)

May 10, 2018 - "Will the Supreme Court Step in Again in Helsinn v. Teva? Does a Sale of Confidential Materials Trigger the On-Sale Bar?" (Federal Circuit Bar Association) - 3:00 pm to 4:00 pm (EST)

May 10, 2018 - European Patent Strategies (Intellectual Property Law Association of Chicago Corporate Committee and Weickmann & Weickmann) - 5:00 pm to 6:05 pm (CT), Chicago, IL

May 15, 2018 - "USPTO Post-Grant Patent Trials 2018: Change & Recalibration" (Practising Law Institute) - San Francisco

May 17, 2018 - "Patenting Antibodies at the EPO" (J A Kemp) - 15:30 (Greenwich Mean Time)

May 17, 2018 - "Patent Exclusivity Health Checks for Biologics: Are Your U.S. Patents Ready to Maximize ROI?" (Strafford) - 1:00 to 2:30 pm (EDT)

May 18, 2018 - "US-China: The Relationship and Concerns Raised in the Section 301 Investigation and Report" (Federal Circuit Bar Association) - 3:00 pm to 4:30 pm (EST)

May 22, 2018 - "Sovereign Immunity and Patents at the PTAB and District Courts" (McDonnell Boehnen Hulbert & Berghoff LLP) - 10:00 am to 11:15 am (CT)

June 13-15, 2018 - Patent Fundamentals Bootcamp 2018: An Introduction to Patent Drafting, Prosecution, and Litigation (Practising Law Institute) - New York, NY

June 25-27, 2018 - Summit on Biosimilars (American Conference Institute) - New York, NY

July 18-20, 2018 - Patent Fundamentals Bootcamp 2018: An Introduction to Patent Drafting, Prosecution, and Litigation (Practising Law Institute) - San Francisco, CA

September 21, 2018 - "USPTO Post-Grant Patent Trials 2018: Change & Recalibration" (Practising Law Institute) - New York & Groupcasts in Philadelphia, Indianapolis, New Brunswick, NJ, Pittsburgh, and Mechanicsburg, PA

MBHB Webinar on Sovereign Immunity and Patents

McDonnell Boehnen Hulbert & Berghoff LLP will be offering a live webinar entitled "Sovereign Immunity and Patents at the PTAB and District Courts" on May 22, 2018 from 10:00 am to 11:15 am (CT).  In this presentation, Patent Docs author and MBHB attorney Kevin Noonan and MBHB attorneys James Lovsin and George "Trey" Lyons, III will discuss sovereign immunity as it applies to Native American Tribes in comparison with the several States and review the Allergan strategy for protecting patent franchises for blockbuster drugs, as well as similar efforts for high technology inventions, and consider the scope of Congressional authority on this question and the likelihood for legislative intervention.

While there is no fee to participate, attendees must register in advance.  Those wishing to register can do so here.  CLE credit is pending for the states of California, Illinois, New Jersey, New York, North Carolina, and Virginia.

USPTO Patent Quality Chat Webinar Series

The U.S. Patent and Trademark Office will be offering the next webinar in its Patent Quality Chat webinar series from 12:00 to 1:00 pm (ET) on May 8, 2018.  The latest webinar, entitled "Subject Matter Eligibility: Revised Guidance in view of Berkheimer v. HP, Inc." will be hosted by USPTO Deputy Commissioner for Patent Examination Policy Bob Bahr, will discuss the USPTO's recently-issued memorandum implementing changes to examination procedure in view of the Federal Circuit's decision in Berkheimer v. HP, Inc., which provides clarification on the subject matter eligibility analysis.

Instructions for viewing the webinar and additional information regarding the Patent Quality Chat webinar series can be found on the USPTO's Patent Quality Chat webpage.

Webinar on Patents for Combination Therapies

J A Kemp will be offering a webinar entitled "Patenting Antibodies at the EPO" on May 17, 2018 starting at 15:30 (Greenwich Mean Time).  Sarah Roques and Pamela Tuxwirth of J A Kemp will address the following topics:

• When broad antibody claims can be obtained
• How to approach inventive step when the target is known
• What data to provide to support inventive step
• Functional/epitope claims
• Other routes to patentability

Those wishing to register can do so here.

PLI Program on USPTO Post-Grant Patent Trials

Practising Law Institute (PLI) will be holding a program entitled "USPTO Post-Grant Patent Trials 2018: Change & Recalibration" in San Francisco (May 15) and New York (September 21).  Webcasts of both sessions will be offered, and groupcasts will be held in Philadelphia, Indianapolis, New Brunswick, NJ, Pittsburgh, and Mechanicsburg, PA on September 21.  The San Francisco session of the program will offer presentations on the following topics:

• Roadblock PTAB: Hardening Patent Portfolios and Adjusting Patent Prosecution Strategies
• PTAB Launch: The Preliminary Proceeding – New Tactics, Evolving Estoppel Risks and Trial Institution
• PTAB Trial Route: The Article I Trial Court: Mechanics – Discovery, Motion Practice and Amendment
• PTAB Endgame: The Final Written Decision, Rehearing and Appeals to the CAFC
• The Long Road: Patent Monetization in Silicon Valley – Licensing and Navigating Efficient Infringement

The New York session of the program will offer presentations on the following topics:

• Roadblock PTAB: Hardening Patent Portfolios and Adjusting Patent Prosecution Strategies
• PTAB Launch: The Preliminary Proceeding – New Tactics, Evolving Estoppel Risks and Trial Institution
• PTAB Trial Route: The Article I Trial Court: Mechanics – Discovery, Motion Practice and Amendment
• PTAB Endgame: The Final Written Decision, Rehearing and Appeals to the CAFC
• Northeast Corridor: Bio/Pharma at the PTAB
• Leveraging the PTAB Journey: Concurrent District Court Trial Strategies

Schedules for both sessions can be found at here.

The registration fee for the program is $1,850.  Those interested in registering for the conference can do so at the PLI website.

Webinar on U.S. Patent Exclusivity for Biologics

Strafford will be offering a webinar entitled "Patent Exclusivity Health Checks for Biologics: Are Your U.S. Patents Ready to Maximize ROI?" on May 17, 2018 from 1:00 to 2:30 pm (EDT).  M. Paul Barker, Steven P. O’Connor, and Sanya Sukduang of Finnegan Henderson Farabow Garrett & Dunner will guide patent counsel on the essentials of patent exclusivity that are in critical need of independent checking, and discuss crucial health checks on U.S. patent exclusivity for biologics in Phase II efficacy trials and proceedings through large scale randomized Phase III clinical trials, submission of the BLA, and subsequent approval and marketing.  The webinar will review the following issues:

• How should counsel respond if a health check uncovers sub-optimal protection or defects in a patent claim?
• Are the BCPIA claims definite or enabled under the current standards?
• Is there a need for supplemental examination to clear the path to enforceability?

The registration fee for the webcast is $297.  Those interested in registering for the webinar, can do so here.

FCBA Webast on US-China Relationship in View of Section 301 Report

The Federal Circuit Bar Association (FCBA) will be offering a webcast entitled "US-China: The Relationship and Concerns Raised in the Section 301 Investigation and Report" on May 18, 2018 from 3:00 pm to 4:30 pm (EST).  Terry Stewart of Stewart and Stewart will moderate a panel consisting of Erin Ennis, Senior Vice President, US-China Business Council; K.C. Swanson, Director, Global Policy, Telecommunications Industry Association; Owen Herrnstadt, Chief of Staff to the International President, International Association of Machinists and Aerospace Workers; and David Ross of WilmerHale.

The webinar is complimentary for FCBA members and $50 (government/academic/retired) or $125 (private practitioner) for non-members.  Those interested in registering for the webcast, can do so here.

Guest Post -- Patent Beauty: IP and the Cosmeceutical Industry

By Shin Hee Lee* and Anthony D. Sabatelli** --

The cosmeceutical industry is ever more competitive and continues to grow with a myriad of new cosmeceutical products entering the market every day.  Well-established and new companies are busily adapting to new trends created by people's changing tastes.  The total revenue of the U.S. cosmeceutical industry has only been increasing since 2009, marking $62.46 billion in 2016.  While this revenue comes from a number of cosmeceutical product categories, skin care has always been the most profitable category, covering 36% of the global market.  In this article, we discuss some of the recent growth and trends in skin care cosmeceutical patents.

It is often unknown that the 182 most recognized beauty brands in the world are actually owned by seven major cosmeceutical companies:  L'Oréal, Johnson and Johnson, Shiseido, Estée Lauder Companies, Unilever, Coty, and Procter & Gamble.  L'Oréal umbrellas the most brands with a total of 39 prevalent companies in an array of beauty stores.  These store brands are very well-known, including Kiehl's, Lancôme, The Body Shop, Urban Decay, and Maybelline.  On the other hand, the Estée Lauder Companies own internationally recognized luxury brands such as Clinique, Bobbi Brown, MAC, Jo Malone, Lab Series, and Glamglow.  These brands highly occupy the shelves in Sephora and other popular beauty vendors.  The plethora of products and the explosion of marketing venues suggests how competitive it can be for new cosmeceutical companies to succeed in the market.

To be competitive in the cosmeceutical industry, a company, whether new, rising or established, should focus on establishing solid intellectual property (IP) rights.  IP rights protect and support elements that help companies distinguish their products from rival companies.  Furthermore, the number of patents can be a powerful marketing tool, especially when touting the "patented" technology used to develop the product.

Because of the significance of IP rights in the cosmeceutical industry, there is currently an overwhelming number of cosmeceutical patents.  Skin care has the leading number of patents, correlating to its enormous global sales (projected to reach $130 billion by 2019).

Anti-aging has been the most popular category within skin care, attributed to the high demand of products promoting youthful looks that defy a consumer's biological age.  The majority of anti-aging patents relate to inventions based on unique compositions of known or novel ingredients.  An assortment of vitamins like retinol (made from vitamin A), vitamin C, coenzyme Q-10, and alpha-hydroxy acids (AHAs) have traditionally been touted to have anti-aging efficacies.  However, with the recent beauty trend of "clean cosmeceuticals," some patentees have pointed at the toxicity of some complementary additives in these vitamins and have filed patents for supposedly more natural plant-based components.  Some anti-aging products contain peptides instead of vitamins as their main component.  A recent study has shown that defensins, a group of antimicrobial peptides that activate stem cells to produce new skin, provide incredible anti-aging effects.  Many reporters have been labeling defensins as "a game changer," and "the newest anti-aging weapon."  Patents on anti-aging formulations will likely surface in the near future.

Another area of intense patent activity relates to cosmetic devices.  Portable home skin care devices for measuring and improving skin conditions have been increasingly patented and commercialized.  One of the pioneers that popularized hand-held devices was a company named Clarisonic (or Pacific Biosciences Laboratories), which owns 40 patents on their devices.  Clarisonic's iconic cleansing tool is a mechanically rotating face brush that oscillates back and forth over the skin to thoroughly remove any oil, debris, makeup and environmental pollutants.  Recently, Neutrogena has introduced small portable stick that treats acne using phototherapy.  Depending on the light color, the stick can treat different types of skin problems.  One futuristic skin care device on the rise is a mirror with built-in digital sensors that detect and analyze the skin's moisture, oiliness, and redness.  Devices that were only accessible at a dermatologist's office are increasingly becoming home-friendly.  We expect the skin care device patents continue to increase in the coming years, especially the design patents.

Shown below are two tables summarizing some of the patent trends for cosmetics and recent devices.

* Shin Hee Lee is a Ph.D. Candidate in the Chemistry Department at Yale University.  She is currently associated with the Yale Energy Sciences Institute, where she specializes in organic synthesis of novel light-harvesting dye molecules for solar cells.  Prior to attending Yale, Shin Hee obtained her B.S. in Chemistry with High Honors at the University of Michigan – Ann Arbor, during which she published patents and papers on developing synthetic methodologies for fluorinated small molecules.
** Dr. Sabatelli is a Partner with Dilworth IP

Genetic Analyses of Sweet Potato Genome Sheds Light on Speciation and Global Dispersion Patterns

By Kevin E. Noonan --

Hiram Bentley Glass and classical geneticists of the Twentieth Century elucidated some of the ways that genetics could inform regarding human populations and their history, using observations like genetic drift (famously, among the Amish) and the "founder effect."  The "genomics" revolution of the last thirty years has extended these observations, for human populations as well as many other animal and plant species (see, e.g., "Genetic Assessment of Squash Genomes in Related Species"; "The Domestication History of Apples Revealed by Genomic Analysis"; and "Domestic Cat Genome Sequenced").  Recently, several outstanding questions regarding the genetics of sweet potato were resolved, in a report in Current Biology, entitled "Reconciling Conflicting Phylogenies in the Origin of Sweet Potato and Dispersal to Polynesia," resulting from genomic and chloroplast DNA analyses that establish the phylogenetic, temporal and geographical relationships between this important crop species and its wild naturally occurring relatives.

The paper, from an international group of researchers* from the University of Oxford, Oregon State University, International Potato Center (Lima, Peru) and Duke University, used genome skimming and target DNA capture on 199 specimens comprising sweet potato (Ipomoea batatas) and all its wild relatives (I. trifida, I. triloba, I. ramosissima, I. cordatotriloba, and I. leucantha).  One of the most consumed crops worldwide, the species originated in the Caribbean region (Central and northeastern South America and the islands comprising the region) but is also endemic to Polynesia.  In addition to the evolutionary relationship between I. batatas and its wild relatives, this geographical distribution pattern has long raised the question of whether dispersion occurred without human intervention (wind, water, birds) or whether there were humans transiting the Pacific much earlier than anthropological evidence suggests.  The genetic evidence shows that human intervention is not necessary to explain sweet potato presence in Polynesia based on comparisons of the relationship (and divergence) of the Polynesian species (Ipomoea littoralis Blume) with I. batatas and other New World members of its family.

The researchers report that their dataset consisted of 199 individuals representing all sixteen species in Ipomoea series Batatas and twenty-four other species across the Ipomoea genus.  These included fresh samples growing contemporaneously as well as herbarium specimens dating back to 1769.  Probes for 605 putative single copy nuclear regions of Ipomoea were derived from a comparison between genomic information from I. lacunosa and coding sequence-restricted data from the related Solanum tuberosum (potato).  The team interrogated genomic regions with a one-to-one match at 70% identity along at least half the length of a Solanum CDS and the results were filtered to retain Ipomoea loci that were at least 1000 bp long.  From these loci 100 bp-long RNA probes were developed, excluding probes with GC content < 25%.  In addition, the researchers obtained complete chloroplast DNA sequences from each specimen.

From these comparisons the scientists concluded that the I. batatas sweet potato species is most closely related to I. trifida.  Speciation arose from a first autohexaploidy event, with the related species having the following family tree set forth in A:

Muñoz-Rodríguez et al., 2018, Current Biology 28(8): 1246-56, Figure 2

Sweet potato is also the only member of this extended family whose evolution contains an autohexaploidy event.  This origin was supported by an analysis of the six alleles in each I. batatas genome, which the researchers found were more closely related to each other than to any other species (shown in B).

When did I. batatas diverge from I. trifida?  Using nuclear DNA comparisons over 21 nuclear regions, the researchers estimated that divergence occurred at least 800,000 years ago; there was also evidence of a population bottleneck ~640,000 years ago.

Whole chloroplast genome analysis was performed and revealed two genetically distinct lineages, with one (termed CL2) being more closely related to chloroplasts contained in I. trifida.  The relationship between the two chloroplast species compared with chloroplasts from I. trifida reported showed no shared insertion/deletion events (indels) between CL1 and CL2, but that I. batatas CL2 chloroplasts shared indels in common with I. trifida chloroplasts.  The results of these analyses suggested that the sweet potato species had undergone two speciation events:  the first, autohexaploidy from an I. trifida-like ancestor, followed by later introgresssion (occurring within about 56,000 years from the autohexapolidy event) by I. trifida, resulting in two populations of chloroplasts in natural species.  The Figure represents this history:

Muñoz-Rodríguez et al., 2018, Current Biology 28(8): 1246-56, Figure 4

This Figure shows two alternative histories to explain the two chloroplast lineages in natural populations, with the evidence being more consistent with Figure C, resulting in an I. batatas species having CL1 and Cl2 chloroplasts.

Turning to the genetic evidence for Polynesian dispersion (which extends today from Polynesia to Madagascar), comparison between the Ipomoea littoralis Blume species and I. batatas indicated (through genetic differences that would have been familiar to Bentley Glass and colleagues) that the sweet potato dispersed to Polynesia 111,500 – 139,000 years ago, predating human contact and putting to rest speculation for the occurrence of trans-Pacific exploration by Polynesia populations earlier than anthropological and other more conventional data suggest.

One of the benefits noted by the scientists in their paper is the practical consequence that, by knowing the relationships between sweet potato and its relatives it may be possible to improve production or other aspects of breeding for a commercially important crop.  More broadly, though, researches such as these extend to more quotidian questions the reach of modern genetic analysis to address long-standing historical conundrums (both human and natural) that were hoped for by the pioneers of the genomics revolution.  Indeed, in view of the transitory nature of history and its artifacts, it is likely that many such questions can only reliably be answered from the history of life written in the genetic code of the organisms that have survived (which makes preserving them all the more important).

*Pablo Muñoz-Rodríguez, Tom Carruthers, John R.I. Wood, Bethany R.M. Williams, Kevin Weitemier, Brent Kronmiller, David Ellis, Noelle L. Anglin, Lucas Longway, Stephen A. Harris, Mark D. Rausher, Steven Kelly, Aaron Liston, and Robert W. Scotland

Image of Ipomoea batatas, Sweet Potato by Llez, from the Wikimedia Commons under the Creative Commons Attribution-Share Alike 3.0 Unported license.