Patent Docs

The Supreme Court Sidesteps America's Patent Eligibility Crisis

By Michael Borella --

In an order that is clearly less impactful and damaging than a number of opinions that the Supreme Court has disgorged in the last two weeks, the justices have denied certiorari in American Axle & Mfg. Inc. v. Neapco Holdings LLC.  To many, American Axle represented the Gordian Knot in patent-eligibility that had been unartfully tied by the Court with help from the Federal Circuit.  The case was possibly the best opportunity yet to clarify what was meant by the remarkably vague two-part test set forth in Alice Corp. v. CLS Bank Int'l.

Complaints about the opaque and harmful nature of Alice began shortly after it was issued, and have continued for the eight years since.  Notably, criticisms did not just come from patent attorneys and patentees -- federal judges, sitting U.S. senators, and law professors have also spoken up against the opinion and its erratic interpretation by the federal courts and the USPTO.  Former Chief Judge Paul Michel of the Federal Circuit summed the situation up by stating that Alice "created a standard that is too vague, too subjective, too unpredictable and impossible to administer in a coherent consistent way in the patent office or in the district courts or even in the federal circuit."

The current state of patent-eligibility under 35 U.S.C. § 101 has deviated far afield from the plain language of the statute and even from the less plain language of Alice.  The Federal Circuit has interpreted the eligibility test to require consideration of the daylight between the claimed invention and the prior art, as well as whether the claims sufficiently recite how to practice the invention with enough specificity.  These notions were formerly the exclusive domain of other sections of Title 35 -- but no longer.  And the Court is apparently okay with the current state of affairs despite these affairs violating principles of statutory interpretation.

As a result, garage door openers, electric vehicle charging stations, and mobile phones -- inventions that should pass the § 101 inquiry with flying colors -- are now too abstract for patenting.  In practice, this means that it can be immensely difficult for an inventor, a business, a patent attorney, a patent examiner, or even a judge to predict whether an invention is viable.  The validity of certain types of claims, those involving software in particular, are perpetually in an indeterminate state until examined in the USPTO or challenged post-issuance.

Some of us were hoping that the Court might take up American Axle so patent law no longer had to share a box with Schrodinger's Cat.  But now it looks like that will not happen, possibly for a long time.  Fixing Alice has proven remarkably difficult despite its obvious problems.  Congress tried three years ago and gave up.  The USPTO tried to clarify the Alice test through examination guidance but only made it more complicated.

The vagaries of patent eligibility produce clear winners and losers.  The economics favor patentees with deep pockets who can persist through multiple rounds of examination and litigation.  These large companies can file hundreds of patents per year, with the understanding that even losing 10-20% to Alice is just a cost of doing business.  Individual inventors and startups are budget-constrained, often having to bet the farm on a single patent application.  All it takes is an unreasonable patent examiner at the USPTO to make obtaining protection virtually impossible.

Viewed this way, there is a throughline in the Court's recent rulings -- protecting the interests of the powerful over those of the weak.  This misguided consistency is harmful in general and not what drives an economy that is more and more based on innovation and intangible assets.

In any event, given that we are where we are and that the current state of § 101 is unlikely to change, what can we do?  Are there any best practices to put into place now that the Court has declined to revisit Alice?  In short, yes, there are a few things that a patentee can do to insulate themselves.

The easiest way to deal with Alice is to not deal with Alice.  Thus, you should consider the nature of the invention when making the decision of whether to file.  If the invention is not sufficiently technical in nature (where technical inventions improve the operation of machines rather than that of businesses or people) or if the invention is not thoroughly fleshed out, it might not be the best candidate for a patent application.  But if the invention is technical and understood in detail, this technical character and such details should be discretely called out in the specification and recited by the claims, as should the differences between the invention and the prior art.  It has been established that the courts look for these three factors (technicality, specificity, and novelty) in both parts of the § 101 analysis.

For pending applications under examination, you have to work with what you have.  You cannot modify the specification, but you can amend the claims.  By placing specific, technical features that distinguish over the prior art in the claims (assuming that such features are supported by the specification), you can move the odds in your favor.

When determining whether to assert a granted patent, the same calculus is involved.  If the claims recite a specific, technical advance over the prior art, then they are in reasonably good shape to survive an eligibility challenge in court.  If not, you may have an uphill battle.

While these factors are not 100% determinative, they are the best guideposts for navigating the Alice labyrinth.  At this point, we have to assume that the Court and Congress are unlikely to reassess patent eligibility for years.  And given the well-placed lack of faith in these institutions, it is not out of the question that such a reassessment could result in a framework that is even worse than the mess we are stuck with today.

Supreme Court Denies Cert in American Axle

By Kevin E. Noonan --

In a month where the Supreme Court's conservative majority has exercised its judicial muscle by striking down several well-established precedents, one portion of their jurisprudence is as fixed a constant as the North Star:  the Court will not address the morass in patent subject matter eligibility created by the decisions in Bilski, Mayo, Alice, and Myriad, and once again refused to do so in American Axle & Mfg. Inc v. Neapco Holdings LLC.  For a Court whose political inclinations are evident and frequently commented upon, the chorus of dissent regarding the state of subject matter eligibility law from the patent community, industry groups, the U.S. Patent and Trademark Office, members of Congress, half (at last count) of the judges on the Federal Circuit, and the Solicitor General has fallen on particularly deaf ears, this refusal being the latest (along with denial of certiorari today in another, less celebrated subject matter eligibility case, Spireon, Inc. v. Procon Analytics, Inc.) in an increasingly long line.

Perhaps this is a blessing in disguise, however, because it is possible that the Court recognizes its decisions have backed the Justices into a rhetorical corner (albeit a Minoan labyrinth may be a better analogy) from which there is no doctrinally straightforward way out.  Alternatively, the Court may believe that the district courts and Federal Circuit have more work to do in clarifying (or muddying) subject matter eligibility law before they will revisit the question.  They may be waiting for Congress to step forward, believing that whatever else their decisions have done they have illuminated the divide between stakeholders who need certainty in the law, such as biotechnology and pharmaceutical companies whose products are sufficiently costly that uncertainties in return on investment threaten to impair innovation, and other companies who would rather more readily be able to "efficiently infringe."  Or perhaps it's as simple as the Court, like Professor Quincy Adams Wagstaff in Horse Feathers, having decided that "whatever it is, I'm against it."

The parlous state of Section 101 remains uncorrected.

University of Massachusetts v. L'Oreal S.A. (Fed. Cir. 2022)

By Kevin E. Noonan --

In reviewing (and reversing) the District Court's claim construction in University of Massachusetts v. L'Oreal S.A., the Federal Circuit availed itself of both the disclosure in the specification and the prosecution history to construe a limitation in a wherein clause, based on its determination that the term did not have a plain meaning and thus other indicia of what the claim term at issue meant should be considered.  The Court also reviewed the District Court's favorable consideration of L'Oreal S.A.'s motion to dismiss on jurisdictional grounds, vacating this determination as an abuse of discretion for failure to grant the University jurisdictional discovery.

The issue arose in the University's lawsuit for patent infringement against L'Oreal S.A. and L'Oreal USA, Inc. over U.S. Patent Nos. 6,423,327 and 6,645,513; the opinion sets forth claim 1 of the '327 patent as representative:

1.  A method for enhancing the condition of unbroken skin of a mammal by reducing one or more of wrinkling, roughness, dryness, or laxity of the skin, without increasing dermal cell proliferation, the method comprising topically applying to the skin a composition comprising a concentration of adenosine in an amount effective to enhance the condition of the skin without increasing dermal cell proliferation, wherein the adenosine concentration applied to the dermal cells is 10^-4 M to 10^-7.

(Where the District Court's construction of the italicized language was the basis for its determination that the claims were invalid for being indefinite.)

While the District Court proceedings were ongoing, L'Oreal USA petitioned the Patent Trial and Appeal Board (PTAB) for institution of inter partes review, which the Board denied.  However, the Board in making its assessment of the institution petition construed the "wherein" clause of claim 1 of the '327 patent to mean the concentration of adenosine at the dermal cells (located underneath the skin surface) rather that the concentration at the skin surface (which comprises the epidermis) (the opinion noting that under 35 U.S.C. § 314(d) these determinations were "final and unappealable").  The District Court also construed the wherein clause to have this meaning without overt construction, holding that the clause was given its "plain and ordinary meaning without the need for further construction."

In applying this construction to the question of invalidity under 35 U.S.C. § 112(b), the District Court granted summary judgment for L'Oreal USA that the claim was indefinite in reciting the limitation "topically applying to the skin a composition comprising a concentration of adenosine in an amount effective to enhance the condition of the skin without increasing dermal cell proliferation" because of the perceived distinctness between the amount of adenosine (directly) applied to the epidermis and the amount (indirectly) applied to the dermal cells and the resulting concentration that is sufficient to both enhance the condition of the skin while not increasing dermal cell proliferation.

The Federal Circuit reversed the District Court's claim construction and vacated summary judgment of indefiniteness in an opinion by Judge Taranto, joined by Judges Mayer and Prost.  The University argued with regard to the claim construction issue that the concentration recited in the wherein clause should be construed to mean the amount of adenosine in the dermis after it has entered the dermal layer, i.e., "the number of moles of adenosine divided by the volume (liters) of the dermis itself."  The Federal Circuit disagreed, holding that the District Court had erred in its construction and vacating and remanding for proceedings based on the Court's construction as set forth in this opinion.  (Review was de novo, because  the District Court relied only upon intrinsic evidence.)  The Court's analysis began with its determination that the meaning of the concentration language in the wherein clause, viewed in the context of the claim as a whole, was not plain and even less plain under the University's construction of it.  The opinion notes that the clause recites adenosine concentration administered to the dermal cells, while the preceding clause relating to skin enhancement recited applying the adenosine-containing composition to the skin (the epidermis). While the way the claim is written with regard of the term "applied" suggested to the panel (as it did to the Board and District Court) a difference in meaning, that is not enough according to the opinion.  The panel recognized that "[t]he same [composition] can be applied directly to one object [(the skin)] and indirectly to the other [(the dermis)]."  Under the Federal Circuit's construction, the concentration of adenosine referenced in the two portions of the claim are the same concentration, which the opinion states is consistent with the language of the dependent claims as well.  The concentration referenced in the skin-enhancement clause refers to the concentration in the composition before it is applied to the skin, which is the same concentration referenced in the wherein clause in the Court's opinion, contrary to the University's proposed construction.  According to the opinion, the University's construction would have the concentration recited in the wherein clause refer to something that does not exist until the composition is applied (and the adenosine absorbed into the skin and the dermal layer).  But if that construction was followed, the wherein clause (in the Court's view) would need to be rewritten to recite "wherein the adenosine permeating to the dermal layer results in a concentration of adenosine in the dermal layer of 10^-4 M to 10^-7 M."  The need for these linguistic gymnastics was enough for the panel to hold that the claim language at issue had no plain meaning and that resort to the specification and prosecution history was in order.

In its review of the disclosure in the specification, the many recitations of the concentration of adenosine in the disclosed composition did not set forth this concentration after penetration into the dermal layer; instead they all disclose concentrations before the composition is applied to the skin.  The opinion states that "[t]his is significant evidence that the wherein clause is best read to refer to the concentration of adenosine in the composition applied to the surface of the skin," referencing Phillips v. AWH Corp., 415 F.3d 1303, 1316 (Fed. Cir. 2005) (en banc); VirnetX, Inc. v. Cisco Systems, Inc., 767 F.3d 1308, 1318 (Fed. Cir. 2014); and Netcraft Corp. v. eBay, Inc., 549 F.3d 1394, 1397–98 (Fed. Cir. 2008).  And there is no disclosure of measuring adenosine concentration in the dermis or the need to do so.

But it is in the prosecution history that the Court found the most persuasive evidence for its construction that the concentration recited in the claims should be construed as the adenosine concentration in the composition before application to the skin.  The Court first looked to the claims as filed, which did not recite the wherein clause present in the claims as granted (that limitation was recited in a dependent claim, but without any mention of dermal cells).  The applicants amended the claim to overcome prior art, and in incorporating the adenosine concentration limitation into the independent claim changed the wording to what was recited in claim 1 of the '327 patent.  However, in their response containing this amendment, the applicants maintained that "[t]his amendment would add no new matter, as it merely includes a range of concentrations of adenosine recited in dependent claims" (emphasis in opinion).  In this response the applicants further distinguished two other prior art references based on concentration of adenosine in the composition before being applied to the skin (as the opinion states, "with no suggestion of a difference in location of concentration measurement").  And the examiner's comments in the reasons for allowance, both in the '327 patent and the '513 patent, contained the statement that the "[i]nstant claims are directed to a method of enhancing the condition of unbroken skin . . . where the method comprises administering adenosine at a concentration of 10^-4 M to 10^-7 M, to the skin" (emphasis in opinion).  In view of this prosecution history, the Federal Circuit held that "the wherein clause's reference to the recited concentrations being 'applied to the dermal cells' be read as referring to concentrations of the composition applied to the skin's surface."  The construction the University advanced before the District Court and on appeal was inconsistent with this history according to the opinion, and "cannot fairly be squared with the understanding that both [the University] and the examiner expressed during prosecution, and on which skilled artisans are entitled to rely," this latter phrase perhaps providing the impetus for the Court's decision.

And in remaining unpersuaded by the University's attempts to distinguish the prosecution history, the Court refused to credit statements in the prosecution history made in response to the examiner's reasons for allowance, which merely recited the claim language and asserted that the applicants did not concede that the examiner's reasons were the only reasons the claims should be allowed (illustrating the futility in believing that such statements would be persuasive in actions to enforce the patent).

The Federal Circuit, applying its construction concluded that the District Court's finding that the claims were indefinite "must be vacated and . . . remanded for the district court to conduct any further proceedings that are necessary" (the panel refusing L'Oreal's suggestion that it enter a judgment of non-infringement directly).

Regarding the jurisdictional question, the District Court adopted a magistrate judge's recommendation that the Court grant L'Oreal S.A.'s motion to dismiss under Federal Rule of Civil Procedure 12(b)(2) without permitting jurisdictional discovery to the University.  The Federal Circuit disapproved of that action, holding that under Third Circuit law it was an abuse of discretion.  The basis for this holding was that "at the very least" jurisdictional discovery was appropriate under Eurofins Pharma US Holdings v. BioAlliance Pharma SA, 623 F.3d 147, 157 (3d Cir. 2010).  The University had "made more than clearly frivolous, bare allegations that L'Oréal S.A. was subject to personal jurisdiction," these allegations including that "L'Oréal S.A. introduced the accused products into the stream of commerce" and that L'Oreal USA was "L'Oréal S.A.'s agent in certain potentially relevant respects."  There was also evidence that L'Oreal S.A. had performed product research on adenosine-containing compositions for treating skin and may have licensed the technology to L'Oreal USA.  Also telling for the panel was that "L'Oréal S.A. did not specifically deny allegations that it developed and licensed the relevant technology to L'Oréal USA" but instead had rather weakly asserted that it had not "directly developed" any of the skincare products at issue in the lawsuit.  The Federal Circuit held that because "this evidence raises the possibility that discovery might have uncovered the requisite contacts under our precedent" (emphasis in opinion), it vacated the District Court's jurisdictional determinations and held that on remand the University was entitled to jurisdictional discovery before the District Court came to and jurisdictional conclusions.

University of Massachusetts v. L'Oreal S.A. (Fed. Cir. 2022)
Panel: Circuit Judges Prost, Mayer, and Taranto
Opinion by Circuit Judge Taranto

USPTO Provides Guidance on PTAB Discretionary Denials of Challenges Based on Parallel Litigation

By Joshua Rich --

On June 22, 2022, the U.S. Patent and Trademark Office issued two documents regarding the Patent Trial and Appeals Board's discretionary denials of post-grant challenges based on parallel litigation: a retrospective study of such denials since 2019[1] and a prospective interim guidance memorandum from the Director regarding considerations for future decisions.[2]  Both documents discuss the circumstances in which the PTAB may choose to deny institution of post-grant challenges when the same patent is being asserted in district court or ITC litigation.  In combination, the two documents identify how to narrow the discretion that the PTAB will exercise in determining whether to proceed based on parallel litigation.

The USPTO's retrospective study identified four cases as causing substantial inflections in discretionary denials of post-grant challenges:  (1) NHK Spring Co., Ltd. v. Intri-Plex Techs., Inc., Case IPR2018- 00752, Paper 8 (Sept. 12, 2018); (2) Apple Inc. v. Fintiv, Inc., Case IPR2020-00019, Paper 11 (March 20, 2020); (3) Sand Revolution II, LLC v. Continental Intermodal Group – Trucking LLC, Case IPR2019-01393, Paper 24 (June 16, 2020); and (4) Sotera Wireless, Inc. v. Masimo Corporation (§ II.A), IPR2020-01019, Paper 12 (Dec. 1, 2020).

In NHK, the PTAB denied institution both on the basis that the cited prior art had already been considered in the Office and because the same invalidity challenges were being raised in the IPR petition and district court litigation.  NHK was notable as the first decision expressly citing the "advanced state" of the district court litigation as a basis for denying the petition, namely that the trial was scheduled to occur before the inter partes review would have reached a final decision.  But it also served as the catalyst for many others to seek denial of institution on the basis of parallel litigation.

Fintiv was one of those cases in which the patent owner asked the PTAB to deny institution.  By that time, there had been enough such requests that the PTAB decided to provide some guidance to parties regarding the considerations that would go into the exercise of its discretion.  The PTAB therefore provided a list of six non-exclusive factors that it would consider:
    (1) whether a stay exists in the parallel litigation or would likely be granted if a proceeding is instituted;
    (2) proximity of the court's trial date to the Board's projected statutory deadline;
    (3) investment in the parallel proceeding by the court and parties;
    (4) overlap between issues raised in the petition and in the parallel proceeding;
    (5) whether the petitioner and the defendant in the parallel proceeding are the same party; and
    (6) other circumstances that impact the Board's exercise of discretion, including the merits.

The promulgation of the Fintiv factors brought increased clarity to whether the PTAB would exercise its discretion to deny institution of a petition, but it also brought a substantial upswing in the percentage of cases in which the argument would arise.  It also led to a similar upswing in the number of cases in which the existence of parallel proceedings would lead to denial of institution.

The upward trend can be clearly seen in one of the USPTO's graphs of both the number of cases and percentage of cases in which discretionary denial was raised:

A little over a year after the Fintiv factors were promulgated, the PTAB decided Sand.  There, the petitioner sought reconsideration of a decision denying institution of an IPR by submitting a stipulation stating that it would not raise the same grounds in the IPR and parallel proceeding.  The Board found that the stipulation, submitted to resolve the fourth Fintiv factor in the petitioner's favor, tipped the balance and instituted the proceeding.  The Sand decision caused the pendulum to swing back toward institution: more parties submitted similar stipulations and the number of discretionary denials based on parallel proceedings eventually shrank.

The trend downward for discretionary denials really escalated with the Sotera decision.  There, the petitioner filed an even broader stipulation agreeing that it would not assert in the district any grounds "raised or that could have been reasonably raised in an IPR."  The PTAB instituted the review in Sotera, and many petitioners followed Sotera's lead, which has led the Board not to exercise its discretion to reject review of the post-grant challenges.

Again, the USPTO's statistical picture tells the tale.  Once petitioners began filing robust Sotera-like petitions in the months after the decision, discretionary denials of institution dropped quickly:

While these cases were being resolved, the USPTO asked for comments to support potential rules on approaches to the exercise of discretion.  It received 822.  So while the Office is sifting through those comments, Director Vidal issued interim guidance to help practitioners.  The guidance came in the form of four practices that the Board will implement.

First, whether the PTAB will have discretion to deny institution depends on the strength of the petition.  If the petition's evidence is insufficient to justify institution on the merits, the Board will not rely on the Fintiv factors as an alternative ground for denial.  If the petition makes a sufficient showing under the statute -- but not a strong one -- the Fintiv factors will be in play.  But if the petition's evidence is compelling, the PTAB will not deny institution on the basis of the Fintiv factors.

Second, the PTAB will consider the Fintiv factors only in relation to parallel district court litigation.  Although it has denied institution based on parallel ITC proceedings in the past, it will no longer do so because the ITC lacks the power to invalidate a patent and its rulings are not binding on the Office or district courts.

Third, following Sotera, the PTAB will not discretionarily deny institution if the petitioner files a stipulation indicating that it will not pursue in the district court the same invalidity grounds or any grounds that could reasonably be raised before the PTAB.  That is, the Office is making the downward trend its full-time practice based on the overwhelming strength of the fourth Fintiv factor.

Fourth, in determining the second Fintiv factor (the proximity of the court's trial date to the Board's projected statutory deadline), the PTAB will consider not only scheduled trial date, but also time-to-trial statistics such as number of cases before the judge and speed and availability of other case dispostions.  This is because -- as numerous comments pointed out -- different courts have different practices regarding the likelihood of extensions of the trial date.  It is a point strongly reflected in the statistics published by the USPTO -- in 2021, review of the Fintiv factors led to discretionary denial about 10% of the time when the case was pending in the District of Delaware, about 15% of the time when the case was pending in the Western District of Texas, and almost 65% of the time when the case was pending in the Eastern District of Texas.

In light of Director Vidal's guidance, practitioners have much greater clarity regarding how to address discretionary challenges based on parallel litigation.  Patent owners know they should not raise the issue based on an ITC proceeding, and likely should not in a slower-to-trial jurisdiction.  But they also know that the argument fits nicely with an argument on the merits, as an attack on the strength of the petition can be couched as a Fintiv argument.  The petitioner, however, can moot the Fintiv argument if it is willing to provide a broad, Sotera-like stipulation not to pursue in the district court any invalidity grounds that it can raise before the PTAB.  As a result, the PTAB's discretion will be much more limited and Fintiv decisions will be far more predictable.

[1] https://www.uspto.gov/sites/default/files/documents/ptab_parallel_litigation_study_20220621_.pdf
[2] https://www.uspto.gov/sites/default/files/documents/interim_proc_discretionary_denials_aia_parallel_district_court_litigation_memo_20220621_.pdf

Conference & CLE Calendar

June 28-29, 2022 - Summit on Biosimilars & Innovator Biologics: Legal, Regulatory, and Commercial Strategies for the Innovator and Biosimilars Marketplace (American Conference Institute) - Boston

June 28, 2022 - UPC Masterclass -- Session 3: "The UPC Approach to Damages Actions and Compensation Claims" (Hoffmann Eitle)

June 28, 2022 - "The Hand of History—The Mind of the Inventor" (U.S. Patent and Trademark Office) - Session 4: Toys, umbrellas, and more

June 29, 2022 - "Life After Brexit - IP Developments in UK and Europe" (Intellectual Property Owners Association and Chartered Institute of Patent Attorneys) - 11:00 am to 12:00 pm (ET)

June 29, 2022 - Artificial Intelligence (AI) and Emerging Technologies (ET) Partnership Series (U.S. Patent and Trademark Office) - 1:00 pm to 5:00 pm (ET)

June 30, 2022 - UPC Masterclass -- Session 3: "The UPC Approach to Damages Actions and Compensation Claims" (Hoffmann Eitle)

June 30, 2022 - "Partnering with the Department of Defense to Protect the Warfighter: Investments in National Health Security" (Biotechnology Innovation Organization) - 1:00 pm to 3:00 pm (ET)

July 5, 2022 - European biotech patent law update (D Young & Co) - 9:00 am, noon, and 5:00 pm (BST)

July 8, 2022 - UPC Masterclass -- Session 4: "The New Regime on the Revocation of European Patents/ The 'Long-arm Jurisdiction'" (Hoffmann Eitle)

USPTO AI/ET Partnership Series

The U.S. Patent and Trademark Office will be holding the inaugural meeting of the Artificial Intelligence (AI) and Emerging Technologies (ET) Partnership Series from 1:00 pm to 5:00 pm (ET) on June 29, 2022.  The meeting will explore various patent policy issues including subject matter eligibility, inventorship, and disclosure practice, and also explore data from patent filings and how they inform innovation trends in these critical technology areas.  The meeting will include discussions of the following topics:

• National Artificial Intelligence Initiative
• Patent Eligibility Jurisprudence Report
• Panel 1: Subject Matter Eligibility and the Impact on AI/ET Innovation
• USPTO AI Dataset & Trends
• Panel 2: Inventorship and the Advent of Machine-Generate Inventions
• Panel 3: Disclosure and AI/ET Inventions

Additional information regarding the customer partnership meeting, including how to participate online, can be found here.

BIO Webinar on Partnering with DoD

The Biotechnology Innovation Organization will be offering a webinar entitled "Partnering with the Department of Defense to Protect the Warfighter: Investments in National Health Security" from 1:00 pm to 3:00 pm (ET) on June 30, 2022.  The webinar will detail the many new and previously available sources of capital, as well as the processes for applying for funding, from the U.S. Department of Defense (DoD).  The meeting will include discussions of the following topics:

• Opening Remarks: Overview and DoD Priorities
• Panel 1: Investing at the Speed of Need: Novel Technologies and Platforms to Accelerate Drug Development
• Panel 2: Repurposing and Redirecting: An Alternate Approach to Accelerating Medical Countermeasures
• Closing Remarks: How to Work with DoD

Those interested in registering for the program, can do so here.

European Biotech Patent Law Webinar

D Young & Co will be offering its next European biotech patent law update on July 5, 2022.  The webinar will be offered at three times:  9:00 am, noon, and 5:00 pm (BST).  D Young & Co European Patent Attorneys Simon O'Brien and Antony Latham will provide an update of new and important EPO biotechnology patent case law.

While there is no fee to participate, attendees must register in advance.  Those wishing to register can do so here.

Novartis Pharmaceuticals Corp. v. Accord Healthcare, Inc. (Fed. Cir. 2022)

By Kevin E. Noonan --

The Federal Circuit recently granted a panel rehearing and vacated a panel decision between these parties decided earlier this year (see Novartis Pharmaceuticals Corp. v. Accord Healthcare), and rendered a decision that reversed the District Court finding in that earlier opinion.

To recap, the case arose in ANDA litigation over U.S. Patent No. 9,187,405, which recites methods for treating recurring remitting multiple sclerosis (RRMS), a degenerative disorder of the myelin surrounding nervous tissue, with fingolimod (2-amino-2-[2-(4-octylphenyl)ethyl]propane-1,3-diol) sold by Novartis under the brand name Gilenya®.  Claim 1 was included in the opinion as representative:

A method for reducing or preventing or alleviating relapses in Relapsing-Remitting multiple sclerosis in a subject in need thereof, comprising orally administering to said subject 2-amino-2-[2-(4-octylphenyl)ethyl]propane-1,3-diol, in free form or in a pharmaceutically acceptable salt form, at a daily dosage of 0.5 mg, absent an immediately preceding loading dose regimen.

The italicized limitation in this claim was the focus of that appeal, the Court's opinion, and Chief Judge Moore's dissent.  As set forth therein, the practice in the prior art had been (for drugs having a necessary therapeutic threshold) to administer a "loading dose," defined as "a higher-than-therapeutic level dose, usually given . . . as the first dose in order to get therapeutic levels up quickly" by undisputed expert testimony.  Similarly undisputed was that loading dose regimens had been used in the prior art for treating multiple sclerosis (MS).  Defendant HEC Pharm Co. Ltd. (the only remaining defendant at trial from more than two dozen generic drug makers and ANDA filers sued by Novartis under 35 U.S.C. § 271(e)(2)) maintained that the '405 patent was invalid because its specification and its priority British patent application (filed eight years before) did not provide an adequate written description of an invention comprising the "absent an immediately preceding loading dose regimen" limitation under 35 U.S.C. § 112(a).  As the Federal Circuit's earlier opinion set out, these applications both disclosed results of an animal model of MS by treatment by oral administration of a hydrochloride salt of fingolimod at 0.3 mg/kg/week dosages.  Both also recited a prophetic example of a human clinical trial using "preferred daily dosage range [of] about from 0.1 to 100 mg" and "a dose of 0.5 to 30 mg [of fingolimod hydrochloride] every other day or once a week" and specifically "0.5, 1.25, or 2.5mg[/day]."  Nowhere in either specification was there express disclosure that a loading dose was to be avoided (but similarly nowhere in either specification was administration of a loading dose expressly taught).

The District Court found that HEC's ANDA product would infringe the '405 patent and that HEC had not shown by clear and convincing evidence that the '405 patent failed to satisfy the written description provisions of § 112(a).  The Court found that the skilled worker would "make the leap" of increasing the dose from 0.3 mg in a rat to 0.5 mg in a human based on expert testimony, and that this specific dosage was found in the recited range of "from 0.1 to 100 mg."  Regarding the absence of a loading dose in the claimed regimen, the District Court found persuasive expert testimony that "'[i]f a loading dose were directed, the Patent would say that a loading dose should be administered 'initially.'"  This was enough for the District Court to find that the specification provided an adequate written description of this negative limitation.

The Federal Circuit affirmed in the earlier appeal, with the majority holding that the District Court's decision regarding the adequacy of the '405 patent specification's disclosure of this limitation was supported by substantial evidence including expert testimony.  With regard to that expert testimony (and its consistency with the disclosure in the '405 specification), the Court noted that "[a] 'disclosure need not recite the claimed invention in haec verba,'" citing Ariad Pharms., Inc. v. Eli Lilly & Co., 598 F.3d 1336, 1351 (Fed. Cir. 2010), and held that "[t]o accept HEC's argument would require us to ignore the perspective of the person of ordinary skill in the art and require literal description of every limitation, in violation of our precedent."  Furthermore, the majority rejected HEC's assertion that the '405 specification contained insufficient "blazemarks" regarding the 0.5 mg/day dose because the blazemarks considerations are only relevant "where the specification describes a broad genus and the claims are directed to a single species or a narrow subgenus"; in such cases "'blazemarks' . . . would lead an ordinarily skilled investigator toward such a species among a slew of competing possibilities," citing Novozymes v. DuPont Nutrition Biosciences APS, 723 F.3d 1336, 1349 (Fed. Cir. 2013).  But the need for blazemarks does not arise "where the claimed species is expressly described in the specification, as the 0.5 mg daily dosage is here" according to the majority, citing Snitzer v. Etzel, 465 F.2d 899, 902 (C.C.P.A. 1972).  The absence of "laundry-list-type disclosure" (which Judge O'Malley discussed in her dissent in Biogen Int'l GmbH v. Mylan Pharmaceuticals Inc.) made a difference in this regard, further used by the majority in supporting its decision.  Finally, the majority opinion noted that the specification had literal description support for the 0.5 mg/day dose.  Accordingly, the majority held that the District Court's determination that HEC failed to show inadequate written description on these grounds was supported by both the specification and "ample expert testimony" and thus affirmed.

Turning to the negative limitation regarding the absence of a loading dose, the majority opinion began by noting that, under Inphi Corp. v. Netlist, Inc., 805 F.3d 1350, 1356 (Fed. Cir. 2015), there is no "new and heightened standard for negative claim limitations" and supported the continued vitality of this principle by citation to several Federal Circuit opinions, including Santarus, Inc. v. Par Pharmaceutical, Inc., 694 F.3d 1344, 1350–51 (Fed. Cir. 2012); In re Bimeda Research. & Development Ltd., 724 F.3d 1320, 1324 (Fed. Cir. 2013); and Nike, Inc. v. Adidas AG, 812 F.3d 1326, 1348 (Fed. Cir. 2016).  The majority perceived HEC's argument as "attempt[ing] to create a new heightened written description standard for negative limitations" contrary to the "central tenet of [the Court's] written description jurisprudence—that the disclosure must be read from the perspective of a person of skill in the art" as well as specific precedent such as All Dental Prodx, LLC v. Advantage Dental Prod., Inc., 309 F.3d 774, 779 (Fed. Cir. 2002).  The majority opinion distinguished HEC's argument (and Chief Judge Moore's dissent, vide infra) that "[t]he mere absence of a positive recitation is not a basis for an exclusion" (M.P.E.P. § 2173.05(i)), and "silence alone is insufficient" (citing the dissent) with the concept of context, specifically "how a skilled artisan reads a disclosure" which is what "matters" to the majority.  For Judges O'Malley and Linn, both HEC and the Chief Judge "urge us to elevate form over substance by creating a new rule that a limitation which is not expressly recited in the disclosure is never adequately described, regardless of how a skilled artisan would read that disclosure."  The adequacy of the '405 specification's written description regarding the negative loading dose limitation was supported, according to the majority, by the District Court who "correctly, and quite carefully, conducted 'an objective inquiry into the four corners of the specification from the perspective of a person of ordinary skill in the art'" (which the opinion then summarized and quoted).  Based on this analysis, the majority stated that they could find no clear error and thus affirmed.

In the earlier appeal, Chief Judge Moore's dissent focused on the adequacy vel non of the written description of the negative limitation regarding the absence of a loading dose of fingolimod hydrochloride.  The Chief Judge asserted that "[t]he majority dramatically expands a patentee's ability to add, years after filing a patent application, negative claim limitations that have zero support in the written description" (emphasis added), summarizing her position as "[s]ilence is not disclosure."  The dissent illustrated how readily answers to questions like the one before the Court can be completely divergent depending on which "policy lever" (as legal academics might call them) are considered most relevant.  The Chief focused on disclosure, which carries with it a requirement for affirmative statements and definitions that without question are not found in the '405 specification.  The dissent noted that the limitation was added in response to an obviousness rejection asserted against claims in a co-pending priority application to the '405 patent.  According to the dissent "the district court (and now the majority) [engaged in] rewriting the specification with expert testimony" to arrive at their conclusion regarding such adequacy.  The Chief concluded her dissent by stating:

The inventors do not get to claim as their invention something they did not disclose in the patent.  There are no fact findings here to defer to—the patent is silent as to loading doses.  The district court relied upon that silence: "The absence of an immediately preceding loading dose from the specification, and from the Prophetic Trial, would tell a person of skill that loading doses are excluded from the invention."  . . .  This is not a finding of fact; it is a misunderstanding of the law.  An inventor cannot satisfy the written description requirement through silence.  And when the majority concludes otherwise, it creates a conflict with our long-standing, uniformly-applied precedent . . . .  While the negative limitation need not be recited in the specification in haec verba, there must be something in the specification that conveys to a skilled artisan that the inventor intended the exclusion:  disadvantages, alternatives, inconsistencies, just something.  This specification is entirely silent and ambivalent about loading doses.  These inventors did not disclose treatment that must exclude a loading dose, and the district court's finding to the contrary is clearly erroneous.  After this case, negative limitations are supported by a specification that simply never mentions them [citations to the record and precedent omitted].

In the current decision, by Chief Judge Moore joined by Judge Hughes (Judge O'Malley having left the Court in May), and with a dissent by Judge Linn, the Chief's understanding and opinion on the issues before the Court prevailed ("the district court clearly erred in finding that the negative claim limitation 'absent an immediately preceding loading dose' added during prosecution to overcome prior art satisfies the written description requirement of 35 U.S.C. § 112(a)").  The panel majority opinion tracks the Chief Judge's dissent in the Court's earlier decision, that negative limitations do bear a burden of disclosure different from affirmative ones.  As set forth in the opinion, this burden can be satisfied for example by including "a reason to exclude the relevant [element]," citing inter alia Santarus, Inc. v. Par Pharm., Inc., 694 F.3d 1344, 1351 (Fed. Cir. 2012); and Inphi Corp. v. Netlist, Inc., 805 F.3d 1350, 1355 (Fed. Cir. 2015), or by including "'statements in the specification expressly listing the disadvantages of using' that element," or by distinguishing among the excluded element and advantageous alternatives.  The opinion calls "the common denominator" of all these rubrics disclosure of the element to be excluded, repeating the Chief's aphorism from her earlier dissent that "silence is not disclosure."  While not disputing the principle that "a negative limitation need not be recited in the specification in haec verba," the majority opinion asserts the need for "something" to be disclosed in the specification "that conveys to a skilled artisan that the inventor intended the exclusion, such as a discussion of disadvantages or alternatives."  The opinion concedes under some circumstances in some particular fields where "the absence of mention of a limitation necessarily excluded that limitation, [then] written description could be satisfied despite the specification's silence," citing Tronzo v. Biomet, Inc., 156 F.3d 1154, 1159 (Fed. Cir. 1998) (constituting a kind of inherent disclosure of the excluded element, an argument Novartis expressly did not make at trial or on appeal).  And expert testimony does not suffice, according to the panel majority, because if it could "such testimony could effectively eliminate the written description requirement."  In coming to its conclusion, the panel majority revisits and reinterprets the evidence adduced at trial in finding the District Court's consideration thereof to be clearly erroneous.

The opinion does contain a nod to Judge O'Malley's concerns in the original panel opinion, that the Court was being asked to create a "heightened standard for negative claim limitations," which the opinion says it is not (although it is clear from elsewhere in the opinion that requiring "something" imposes more than the original panel majority required).  The further concession that it is possible that under some circumstances "it can be established that a skilled artisan would understand a negative limitation to necessarily be present in a disclosure," the opinion states clearly that "[t]his is not such a case."

Judge Linn (who with Judge O'Malley formed the majority in the earlier opinion) dissented, expressing his view that imposing a heightened standard for negative limitation disclosure in satisfying the written description requirement was exactly that the majority was doing.  Ultimately the question is the metes and bounds of what is required for a specification to "reasonably disclose" possession of the claimed invention, and Judge Linn cites some of the same cases (Inphi, for example) for the principle that "there is no 'new and heightened standard for negative claim limitations'" that the panel majority cited in support of the opposite conclusion.  And in Santarus, Judge Linn notes that while the Court "observed" that a specification could describe a reason to exclude a limitation or element, the decision did not require it to provide adequate written description support for a negative limitation.  While acknowledging that the panel majority cited principles regarding the adequacy of a written description with which he agreed, Judge Linn did not agree with the heightened standard of necessary exclusion enunciated in their opinion.  Citing In re Bimeda Research & Development Ltd., 724 F.3d 1320, 1324 (Fed. Cir. 2013), Judge Linn identified instances where a negative limitation was not adequately supported to include where "a negative limitation which is inconsistent with the disclosure is not adequately described."  And the dissent cites multiple examples of cases stating the lack of an in haec verba requirement (see All Dental Prods., LLC v. Advantage Dental Prod., Inc., 309 F.3d 774, 779 (Fed. Cir. 2002) (citing Eiselstein v. Frank, 52 F.3d 1035, 1039 (Fed. Cir. 1995)) and the lack of a heightened disclosure requirement for negative limitations, see Nike, Inc. v. Adidas AG, 812 F.3d 1326, 1348 (Fed. Cir. 2016), overruled on other grounds by Aqua Prods., Inc. v. Matal, 872 F.3d 1290 (Fed. Cir. 2017) (en banc).  Judge Linn even cites the M.P.E.P., explaining in a footnote "not because the court is bound by it but because I find its reasoning informative and persuasive."

In his own explication of the factual bases of the District Court's decision, Judge Linn finds that the District Court conducted "an objective inquiry into the four corners of the specification from the perspective of a person of ordinary skill in the art" in arriving at its conclusion, supported by expert testimony to make "the unremarkable, and factually supported, determination that 'starting with a daily dose plainly implies that there is no loading dose.'"  With regard to the majority's reliance on its own interpretation of the word "initially," Judge Linn states the equally unremarkable rubric of appellate review that:

We are not free to substitute our own factual findings for those of the district court absent clear error because 'a district court judge who has presided over, and listened to, the entire proceeding has a comparatively greater opportunity to gain the necessary "familiarity with specific scientific problems and principles," . . . than an appeals court judge who must read a written transcript or perhaps just those portions referenced by the parties,'" citing Teva Pharms. USA, Inc. v. Sandoz, Inc., 574 U.S. 318, 319 (2015) (quoting Graver Tank & Mfg. Co. v. Linde Air Prods. Co., 339 U.S. 605, 610 (1950)).

The majority decision, while well-reasoned, illustrates the flexibility of the deference reviewing courts are required under precedent to give district court decisions on questions of fact (written description being quintessentially a question of fact).  As set out in the opinion, a district court's factual determination is not to be overturned "in the absence of a definite and firm conviction that a mistake has been made," citing Scanner Techs. Corp. v. ICOS Vision Sys. Corp. N.V., 528 F.3d 1365, 1374 (Fed. Cir. 2008), and at trial HEC had the burden to show invalidity by clear and convincing evidence (under Hynix Semiconductor Inc. v. Rambus Inc., 645 F.3d 1336, 1351 (Fed. Cir. 2011), and ICU Med., Inc. v. Alaris Med. Sys., Inc., 558 F.3d 1368, 1376 (Fed. Cir. 2009), as cited in the opinion).  It is understandable that the majority thought rehearing and reversal was the proper outcome, but perhaps the issue might have been better reviewed en banc.

Novartis Pharmaceuticals Corp. v. Accord Healthcare, Inc. (Fed. Cir. 2022)
Panel: Chief Judge Moore and Circuit Judges Linn and Hughes
Opinion by Chief Judge Moore; dissenting opinion by Circuit Judge Linn

Cornell Research Foundation, Inc. v. Vidal (Fed. Cir. 2022)

By Kevin E. Noonan --

Last month in Cornell Research Foundation, Inc. v. Vidal, the Federal Circuit affirmed the Patent Trial and Appeal Board's determinations in six inter partes review proceedings that invalidated the challenged claims for being obvious.

The claims of the challenged patents were directed to methods for producing phytases (enzymes that help livestock absorb phosphate from the diet) for supplementing animal feed using genetic engineering to introduce and express a bacterial (Escherichia coli) phytase gene in fungal (typically yeast such as Saccharomyces cerevisiae and Pichia pastoris) cells.  The opinion sets forth the following as representative claims of U.S. Patent No. 8,993,300, one of the challenged patents:

1.  A method of producing a phytase in fungal cells, the method comprising:
    providing a polynucleotide encoding an Escherichia coli phytase;
    expressing the polynucleotide in the fungal cells; and
    isolating the expressed Escherichia coli phytase wherein the Escherichia coli phytase catalyzes the release of phosphate from phytate.

10.  The method of claim 1 wherein the Escherichia coli phytase has an optimum activity at a temperature range of 57 degrees C to 65 degrees C.

11.  The method of claim 1 wherein the Escherichia coli phytase retains at least 40% of its activity after heating the phytase for 15 minutes at 80 degrees C.

12.  The method of claim 1 wherein the Escherichia coli phytase retains at least 60% of its activity after heating the phytase for 15 minutes at 60 degrees C.

Challenger Associated British Foods (ABF) asserted two combinations of prior art according to the opinion, depending on whether U.S. Patent No. 5,876,997 to Kretz was included.  Taking the non-Kretz containing combinations first, the opinion recites two subcombinations:  U.S. Patent No. 5,985,605 to Cheng in combination with a first scientific reference (Dassa) disclosing the nucleotide sequence of a first E. coli phytase and a second scientific reference (Greiner) disclosing more generally E. coli phytase genetics, and a second subcombination of the Dassa and Grenier references with U.S. Patent No. 5,436,156 to Van Gorcom and a third scientific reference (Romanos) disclosing recombinant genetics in yeast.  ABF argued that the thermostability-reciting claims (claims 10-12 of the '300 patent) would have been obvious either as being inherent properties of the combination of references or having been expressly disclosed in a fourth scientific reference (Olson).  The Board held in its Final Written Decision that ABF had established both a motivation to combine and a reasonable expectation of success on the record to establish obviousness of the challenged claims.  Regarding those combinations that included the Kretz reference the Board held that this reference alone anticipated certain claims under 35 U.S.C. § 102(e) or rendered the challenged claims obvious in combination with the other asserted references.

The Federal Circuit affirmed, in an opinion by Judge Prost, joined by Judges Reyna and Taranto.  On appeal, Cornell challenged the Board's determination that there was a motivation to combine and reasonable expectation of success sufficient to render the challenged claims obvious, that the thermostability properties of the claimed phytases were an inherent property of the phytases disclosed in the cited art, and that Cornell failed to antedate the Kretz reference (although the opinion states that the panel did not reach this third ground of appeal).

Cornell's first ground of appeal was unpersuasive because of the Board's reliance on fact evidence, specifically expert testimony, and the deference the Federal Circuit must give to the Office's factual determinations under Dickerson v. Zurko.  Regarding whether thermostability of the recombinant phytases was inherent, this was another question of fact the panel reviewed for substantial evidence.  The Board relied on testimony from Cornell's own expert witness that "express[ing] the same enzyme in the same host under the same conditions" produces "inherent results," including thermostability (emphasis in opinion).  This was enough for the panel to satisfy the substantial evidence requirement, and Cornell's arguments to the contrary, that this finding was inconsistent with a finding of no inherency regarding anticipation by the Kretz reference and the Board restricting its assessment of inherency to the disclosure of the '300 patent, were not persuasive, based in part on the Kretz reference disclosing a different E. coli phytase gene.

Accordingly, the Federal Circuit affirmed the PTAB's decision that the challenged claims were obvious and awarded costs to the government.

Cornell Research Foundation, Inc. v. Vidal (Fed. Cir. 2022)
Nonprecedential disposition
Panel: Circuit Judges Prost, Reyna, and Taranto
Opinion by Circuit Judge Prost

Conference & CLE Calendar

June 21, 2022 - "The Hand of History—The Mind of the Inventor" (U.S. Patent and Trademark Office) - Session 3: Automobiles and Aviation

June 22, 2022 - Proud Innovation series -- "Making your passion profitable" (Office of Innovation Outreach of the U.S. Patent and Trademark Office) - 3:00 pm to 4:05 pm (ET)

June 28-29, 2022 - Summit on Biosimilars & Innovator Biologics: Legal, Regulatory, and Commercial Strategies for the Innovator and Biosimilars Marketplace (American Conference Institute) - Boston

June 28, 2022 - UPC Masterclass -- Session 3: "The UPC Approach to Damages Actions and Compensation Claims" (Hoffmann Eitle)

June 28, 2022 - "The Hand of History—The Mind of the Inventor" (U.S. Patent and Trademark Office) - Session 4: Toys, umbrellas, and more

June 29, 2022 - "Life After Brexit - IP Developments in UK and Europe" (Intellectual Property Owners Association and Chartered Institute of Patent Attorneys) - 11:00 am to 12:00 pm (ET)

June 30, 2022 - UPC Masterclass -- Session 3: "The UPC Approach to Damages Actions and Compensation Claims" (Hoffmann Eitle)

July 8, 2022 - UPC Masterclass -- Session 4: "The New Regime on the Revocation of European Patents/ The 'Long-arm Jurisdiction'" (Hoffmann Eitle)

IPO & CIPA Webinar on Life After Brexit

The Intellectual Property Owners Association (IPO) and Chartered Institute of Patent Attorneys (CIPA) will be offering a one-hour webinar entitled "Life After Brexit - IP Developments in UK and Europe" on June 29, 2022 from 11:00 am to 12:00 pm (ET).  Caelia Bryn-Jacobsen of Kilburn & Strode, Matthew Georgiou of Carpmaels & Ransford, and Leythem Wall of Oxon IP will address recent IP developments in the United Kingdom and Europe post-Brexit.  The panel will provide an overview of IP rights, the UK and European litigation landscape, and address what has (and has not) changed in the UK.  The webinar will also address the following topics:

• Impact of Brexit on European IP
• The Unitary Patent and Unified Patent Court (UPC)
• UK patent, trademark, and design rights
• Representation rights UK, EPO, and UPC

The registration fee for the webinar is $150 for non-members or free for IPO members (government and academic rates are available upon request).  Those interested in attending the webinar should register here.

District Court Rules PureCircle Steviol Glycoside Patents Invalid

By Kevin E. Noonan --

On May 23rd, U.S. District Court Judge James V. Selna of the Central District of California granted summary judgement to Defendant Sweegen, Inc. on its motion that Plaintiff Pure Circle USA Inc.'s claims in suit were invalid for reciting patent ineligible subject matter and for failing to satisfy the written description and enablement requirements of 35 U.S.C. § 112(a), in PureCircle USA Inc. v. SweeGen, Inc.  Neither judgment was surprising in the current patent environment, but the District Court's reasoning is illustrative of the current state of U.S. patent law.

The suit involved methods for making particular glucosylated forms of the natural sweetener steviol obtained from the Stevia rebaudiana plant.  The plant produces a variety of rebaudioside variants having various levels of glycosylation; the most predominant of these in the plant is termed "RebA" but this is not the most commercially valuable form.  That form, termed variably "RebX" and "RebM" contains six glucose residues on the steviol core, illustrated in the opinion by this diagram:

(As will become evident from the claims, there are several intermediate glycosylated rebaudioside derivatives, termed RebB, RebC, RebD, etc.)  The opinion sets forth that RebM is preferred due to its sweetness but that it only exists as "less than about 0.1% by weight of the total steviol glycoside content . . . in the natural stevia plant."

PureCircle asserted all claims in U.S. Patent Nos. 9,243,273 (claims 1-14) and 10,485,257 (claims 1-7), and Sweegen moved for summary judgment that the '257 patent and '257 patent were invalid under 35 U.S.C. § 101 and § 112(a); the opinion set forth these claims as representative:

Claim 1 of the '257 patent:

1.  A method for adding at least one glucose unit to a steviol glycoside substrate to provide a target steviol glycoside, comprising contacting the steviol glycoside substrate with a recombinant biocatalyst protein enzyme comprising UDP-glucosyltransferase, wherein the target steviol glycoside is Rebaudioside X.

Claim 1 of the '273 patent:

1.  A method for making Rebaudioside X comprising a step of converting Rebaudioside D to Rebaudioside X using a UDP-glucosyltransferase, wherein the conversion of Rebaudioside D to Rebaudioside X is at least about 50% complete.

As stated in the opinion, "the method of the Asserted Patents makes Reb M by using UGT enzymes to add sugar units to a steviol glycoside with less than six sugar units until it has six, thereby converting it to Reb M," wherein the UGT-glucosyltransferase enzymes used in the claimed methods are produced recombinantly in yeast cells.

The District Court granted PureCircle's motion that Sweegen's commercial product, Bestevia Reb M, infringed claims 1-7 of the '257 patent, which Sweegen did not dispute "to the extent that the claims are valid."  With regard to invalidity, Sweegen contended that the product of the claims was naturally occurring and that the method for making them merely replicated what occurs natively in the stevia plant.  Accordingly, Sweegen maintained, the claims were invalid for being direct to laws of nature under the Supreme Court's subject matter eligibility jurisprudence, which the District Court recognized to include Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347, 2350 (2014); Ass'n for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 577 (2013); Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 89 (2012); and Diamond v. Diehr, 450 U.S. 175, 185 (1981).  In addition, Sweegen asserted that the claims lacked an inventive concept base on five distinctions asserted in response by PureCircle:

1) the use of "recombinant" UGT enzymes in Claims 1-7 of the '257 Patent;
2) the use of "host microorganisms" to "express" the UGT enzymes in Claims 6-7 of the '257 Patent and Claims 12-13 of the '273 Patent;
3) the purity percentages for Reb M in Claims 3-5 of the '257 Patent and Claims 4-6 of the '273 Patent;
4) the conversion percentages of Reb D to Reb M in Claims 1 and 7-11 of the '273 Patent; and
5) the use of the UGT76G1 UGT enzyme in Claim 14 of the '273 Patent.

For the first two of these, Sweegen contended that the structure and function of the UDP-glucosyltransferases recited in the claims were identical to these enzymes as they exist in nature and did not recite "any non-natural role the enzyme plays in the claimed process" (which is a frequent source of invalidating comparison for any naturally occurring compound, insofar as changing the structure and/or function reduces or eliminates the desired biological activity).  Regarding the third and fourth allegations of subject matter eligibility, Sweegen argued that the asserted claims contained no "steps or methods for achieving the claimed purity or completion percentages" (although this argument appears more fitting for a non-enablement or indefiniteness arguments).  Finally, as to the fifth allegation, Sweegen argued that the disclosed enzyme, termed UGT76G1 was also naturally occurring.

PureCircle argued that the preparation methods did not occur in nature, with regard to taking an isolated RebA preparation and using a recombinant UDP-glucosyltransferase, analogizing these claims to the claims found patent-eligible in Rapid Litig. Mgmt Ltd. v. CellzDirect, Inc., 827 F.3d 1042, 1047 (Fed. Cir. 2016), and Illumina, Inc. v. Ariosa Diagnostics, 967 F.3d 1319, 1325-29 (Fed. Cir. 2020).  PureCircle also pointed out that, in nature, the plant contains enzymes that deglucosylate steviol glycosides, thus making impossible production of RebM in quantities achieved using the claimed methods.

Sweegen countered by arguing that claims reciting man-made elements can be ineligible under Federal Circuit precedent, citing Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC, 915 F.3d 743, 750, 753-54 (Fed. Cir. 2019); Roche Molecular Systems, Inc. v. CEPHEID, 905 F.3d 1363, 1371-73 (Fed. Cir. 2018); Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1373-74, 1376-77 (Fed. Cir. 2015), and further that the recited enzymes are "structurally and functionally identical to the naturally occurring UGT enzymes" and accordingly do not overcome patent-ineligibility of the asserted claims.  Moreover, Sweegen argued that the purity and percentage of conversion to RebM do not in themselves change the "underlying natural process[es]."  Finally, Sweegen argued that "methods of preparation" are not per se patent-eligible under the cited precedent.

The District Court agreed with Sweegen, finding claims 1-5 of the '257 patent and claims 1-11 and 14 of the '273 patent invalid for reciting patent-ineligible subject matter.  According to the Court, the claims were directed to the natural law of converting rebaudiosides, and specifically RebD, into RebM.  In the Court's view, "there is no dispute that the conversion of steviol glycosides and Reb D to Reb M using UGT enzymes is a natural process."  The Court found this characterization to be supported by disclosure in the specification, which was expressed as disclosing a "biocatalytic process," defined as "the use of natural catalysts, such as protein enzymes, to perform chemical transformations on organic compounds" (emphasis added).  The Court relied on Athena for the proposition that "[s]ynthetically-created chemical compositions that are structurally and functionally identical to their naturally-occurring counterparts . . . are not patent eligible" and the admission in the specification that the recombinant enzymes were structurally and functionally "identical" to the naturally occurring enzymes.  The District Court rejected the distinction PureCircle attempted to draw for "method of preparation" claims analogous to CellzDirect and expressly with regard to any suggestion that such claims are per se patent eligible, as being inconsistent with precedent particularly the Supreme Court's rationale in Alice.

The claims of the '257 patent not invalidated on Section 101 grounds recited:

6.  The method of claim 1, wherein the UDP-glucosyltransferase is expressed in a host microorganism.

7.  The method of claim 6, wherein the host microorganism is selected from the group consisting of: Escherichia coli, Saccharomyces species, Aspergillus species, and Pisehia species.

And the claim of the '273 patent not invalidated on Section 101 grounds recited:

13.  The method of claim 12, wherein the UDP-glucosyltransferase host microorganism is selected from the group consisting of: Escherichia coli, Saccharomyces species, Aspergillus species, and Pischia species.

The District Court recognizing these recited limitations as providing "something more" than the natural law as required under Supreme Court and Federal Circuit precedent, that something being in this case "a particular step performed by a human for achieving a particular result," which the Court finds "takes those claims beyond the natural law itself."

Turning to Sweegen's motion for an invalidity finding on written description grounds, the District Court agreed with Sweegen that the recited claim element "UDP-glucosyltransferase" is a "broad, functionally-defined genus" and thus can embrace "not just naturally occurring UDP-glucosyltransferases, but 'any' UDP-glucosyltransferase mutant, fusion, and UDP-glucosyltransferase known or discovered after the patents' . . . filing date" (estimated by Sweegen to encompass a trillion (1012), molecules, "a limitless number," citing Juno Therapeutics, Inc. v. Kite Pharma, Inc., 10 F.4th 1330, 1337 (Fed. Cir. 2021)).  The District Court also agreed with Sweegen that the specification does not recite a "a representative number of species or identify any common structural features for UGT enzymes" and that the sequence similarities between different UDP-glucosyltransferase were not correlated with enzymatic activity.  In evidence was a comparison between 12 UGT enzymes wherein only 4 had shown an enzymatic activity that added glucose to steviol glycoside molecules.  PureCircle countered this evidence by asserting that the term ""UDP-glucosyltransferase" is structural because, inter alia, there are other UGT enzymes that do not add glucose residues to rebaudiosides and that the Court's claim construction limits the scope of the claims to those UGT enzymes that do transfer glucose moieties into rebaudiosides as disclosed and claimed.  Finally, PureCircle argued that there are disputed material facts that preclude summary judgment, including that the term "UDP-glucosyltransferases" was itself structural and the structure of functional UGT enzymes had been determined by crystallographic comparisons (unfortunately for PureCircle, the District Court found that none of these crystallographically determined common structural features were disclosed in the specification).  Sweegen countered that the specification did not provide (express) written description support for "every" UGT enzyme capable of converting inter alia RebD to RebM (which was the construction the Court gave to the claim element "UDP-glucosyltransferase").  In addition, Sweegen asserted that neither of the specifications disclosed structural features common to members of the genus of UDP-glucosyltransferases.

The District Court considered the issue to be whether the genus of UDP-glucosyltransferases was defined (and described) structurally or functionally and, deciding it was the latter, found that the claims did not provide adequate written description support.  This determination was supported by the stipulated meaning of the term, i.e., "[a] type of enzyme that is capable of transferring a glucose unit from a uridine diphosphate glucose molecule to a steviol glycoside molecule."  Accordingly, the fact that these claims reciting this limitation were "original" claims they were not entitled to a presumption of adequate written description support.  Under these circumstances, the Court held, precedent requires a showing that "the applicant has invented species sufficient to support a claim to the functionally-defined genus," citing Juno, or "structural features common to the members of the genus so that one of skill in the art can 'visualize or recognize' the members of the genus," citing Ariad Pharma. Inc. v. Eli Lilly & Co., 598 F.3d 1336, 1352 (Fed. Cir. 2010).  The opinion states that there is no dispute between the parties that the specification does not expressly disclose "structural features common to all UGT enzymes" having the recited function; in fact only 4 UGT enzymes are disclosed (UGT76G1, UGT91D2, UGT91D2e, and UGT91D11) and the specification further states that "the particular UDP-glucosyltransferase used in each reaction can either be the same or different, depending on the particular site on the steviol glycoside substrate where glucose is to be added."  Amino acid sequence comparisons, which had been sufficient to overcome a written description rejection before the Patent Office were not persuasive before the Court, based on an understanding that "[a]n enzyme's amino acid sequence does not necessarily predict the enzyme's activity (or functionality) and, therefore, testing is always required to determine the enzyme's activity (or functionality)," from which the Court concluded that "two enzymes with the similar sequences can have different functions and two enzymes with very different sequences can have the same function" (which, to be candid overstates what is a relatively weak biological rule of thumb).  But here, the Court found that a comparison of two of the disclosed UDP-glucosyltransferases (UGT76G1 and UGT91D2) did not disclose common structural features sufficient to satisfy the requirement for an adequate written description.  Finally, the District Court found that as of the filing date common structural features between different UDP-glucosyltransferases were not known in the art (and what features that were known were not universally associated with UDP-glucosyltransferase function).  Accordingly, the District Court granted Sweegen's motion that all asserted claims were invalid for failure to satisfy the written description requirement of 35 U.S.C. § 112(a).

The Court dismissed as moot a third ground of invalidity asserted by Sweegen, sounding in non-enablement.  However, in view of the District Court's rationale in its written description determination, and the recent trend at the Federal Circuit in applying the enablement standard in chemical, pharma, and biotechnology cases (see, e.g., Amgen Inc. v. Sanofi and Idenix Pharmaceuticals LLC v. Gilead Sciences Inc.) it is unlikely that PureCircle would have received any different outcome if the Court had considered this ground on the merits.

While the District Court's decision is likely to be followed by an appeal to the Federal Circuit, PureCircle should expect an uphill battle.  On the written description issue, as a question of fact the District Court is entitled to "clear error" deference which should prove difficult to overcome in view of the reasoning based on evidence cited in the opinion.  And no patentee having had their claims invalidated under Section 101 has had any reason to be sanguine on appeal for the past ten years (although the recent Solicitor General's amicus brief recommending the Supreme Court revisit the subject matter eligibility issue in Am. Axle & Mfg., Inc. v. Neapco Holdings LLC at least raises the possibility that there may be (perhaps just faint) hope for the standard to be reconsidered).

A Few Things that USPTO Could Do to Simplify Patent Prosecution

By Michael Borella --

The U.S. Patent and Trademark Office handles hundreds of thousands of patent applications per year, as well as various types of administrative patent proceedings.  While the USPTO has made incremental improvements in its examination practices and IT systems to streamline applicant workflows, there are a number of relatively small changes that it could employ to reduce applicant time and expense.  Both substantive and procedural, these changes would clarify certain aspects of examination while eliminating redundant paperwork.  The net outcome of these changes would be a reduction in cost for applicants -- namely, less time spent by patent attorneys, agents, and paralegals, leading to lower overall attorneys' fees.

The items below are not intended to be a comprehensive listing, and come with the caveat that there would be an upfront cost for the USPTO to make these changes.  Nonetheless, the cost savings, when amortized over millions of transactions per year, are likely to be significant.

1.  Explicitly provide the examiner's claim construction in Office actions

In order to evaluate an application's claims against the prior art and to determine whether they comply with other requirements (e.g., written description, enablement, and patent eligibility), the examiner is required to construe the claims -- to assign a meaning and scope to claim terms.

Nonetheless, it is rare for an examiner to provide their claim construction in an initial office action.  In many cases, the first opportunity that the applicant has to learn of the examiner's construction is in an interview or in a subsequent Office action.

This results in applicants and examiners talking past each other in office actions and responses.  All too often, the examiner has one construction in mind, and the applicant has another.  Until these parties at least become aware of the other's thinking, it may be difficult to progress the application.  In many examples, one or two Office action cycles could have been eliminated if the examiner's claim construction was readily available from the outset.

Therefore, each Office action should have a dedicated section in which the examiner provides a construction for any non-trivial claim terms to which the examiner is applying an interpretation beyond those terms' plain and ordinary meaning.  It should be recommended that the examiner construe all claim terms if possible, as doing so can only help accelerate prosecution.

In turn, the applicant would have an opportunity to, on a term-by-term basis, either accept the examiner's construction or rebut the examiner's construction with one of its own.  But at the very least, the applicant would have a better understanding of why the examiner finds certain prior art references to be relevant to the claims.

As they say, you cannot have a meaningful debate with someone unless you can agree on a common set of facts.

2.  Use claim charts to apply the prior art to claim elements

Current USPTO Office actions reject claims based on a narrative from the examiner.  These narratives are typically in paragraph form, providing a claim element, citations to sections of prior art references that are purportedly relevant to the element, and any further reasoning from the examiner.

This narrative form can be confusing to follow in the best of cases, as sometimes the examiner's reasoning is unclear or ambiguous.  But where it really breaks down is when the examiner uses two or more references against the same claim element.  Discussion of these references might be split across several different parts of the Office action, making it difficult for the applicant to grasp the examiner's logic.  Also, it is not uncommon for the application of the references to various parts of the claim element to be imprecise.

As an example, consider the claim element, "sorting the list of words in reverse alphabetical order."  Suppose that the examiner has concluded that disclosure within the Smith and Jones references render the element obvious.  In a traditional Office action, the examiner might write:

Smith discloses sorting a list of numbers in ascending order (para. 55-56, "The array may be sorted in various ways, such as in order from lowest to highest").

[ Several paragraphs later . . .]

Jones discloses reverse ordering of data (Fig 12, para. 132, "It should be understand that orderings of these elements can be ascending or descending.").

[ Several paragraphs later . . .]

Smith and Jones fail to explicitly disclose sorting a list of words.  However, one of ordinary skill in the art would understand that if numbers can be sorted in ascending or descending order, by analogy a list of words can also be sorted in alphabetical or reverse alphabetical order.

While the grounds of this example of examiner reasoning might be solid, the application of the references to the claim element requires that the applicant look in three different locations to understand the full extent of the examiner's position.

The same text appearing in a claim chart would be much more clear and concise.  An example follows:

This format puts all discussion of each claim element in one place, reducing the amount of effort and guesswork that goes into attaining understanding of an examiner's position.  Further, the claim chart format has the additional advantage of making it very easy to ensure that all claim elements are considered by the examiner.  It is not unusual for examiners to unintentionally miss a claim element, especially when the claim is complicated.  Also, this format prompts the examiner to provide their reasoning rather than just cite the prior art.

3.  Allow applicants to send calendar invites to examiners and to use popular conferencing tools

Currently, setting up examiner interviews can be a bit of a hassle.  The applicant needs to contact the examiner by phone, find a suitable time, and then prepare and send an interview agenda to the examiner.  All this for a telephone interview.  The USPTO supports video conferences with examiners, but only using WebEx and through a more onerous setup process.[1]

As we have learned in the last two-plus years of COVID, conferencing tools such as Teams and Zoom have become largely ubiquitous and are efficient and reliable ways of holding remote meetings.  Further, they support very simple screen sharing capabilities.  While it is understandable that some examiners might not have working camera setups, the applicant and examiner seeing each other is not required.[2]  It can be very helpful to just share a view of the applicant's specification and drawings, and/or the prior art documents.

In an ideal scenario, the examiner's email address would be printed in each Office action.  The applicant would then be able to send a Teams or Zoom calendar invite to the examiner.  The examiner would have the right to accept the invitation, propose an alternative time, or decline the video conference and fall back on a telephone interview.  During the call, screen sharing could be used to facilitate the discussion.

4.  Stop asking applicants to provide information that the USPTO already has

There are numerous filings that applicants make from time to time that require that the applicant provide information to the USPTO that is already in an application's file wrapper, or is otherwise in USPTO databases.

Requests for corrected filing receipts typically require that the applicant provide copies of edits to be made to the application's filing receipt as well as its application data sheet (ADS).  In some cases, these edits take the forms of manually adding text to a PDF document.  For simple changes, such as adding or removing an inventor or correcting a clerical error, only a single form should be required.  Likewise, any filing currently requiring a chain of title should not make the applicant inform the USPTO of the chain of title if it already exists in the application's file wrapper.

An even more onerous example is Information Disclosure Statement (IDS) forms that require that the applicant enter the patent number or application number, filing or publication date, and applicant or inventor of each cited US patent or application.  Doing so for a lengthy IDS is very time-consuming and error prone.

Since the USPTO has all of this information, the applicant should be able to enter just the patent number or application number into a web-based interface and let the USPTO's system fill out the rest.  Better yet, let the applicant put all of this information into a CSV or flat file and upload it to the USPTO's filing portal.  The portal can automatically fill in the required information and/or flag any errors.  Given that long IDSs can sometimes take several hours of paralegal and attorney time to complete and file, this change alone would go a long way toward making patent prosecution more affordable.

The USPTO's current web-based ADS form is an example of how the USPTO has the ability to auto-populate forms.  The same should be done for as many forms as possible.

5.  A few odd and ends

Finally, here are a few quick hits that round out the wish list.

The USPTO currently downsamples the resolution of drawings.  Why?  It is my understanding that the USPTO keeps the high-resolution versions somewhere for publication and printing purposes.  So why use inferior versions in PAIR?  In some cases, this can lead to objections to the drawings for lack of readability even though the submitted versions were readable.  Given today's storage, processing, and networking capacity, the rationale for such downsampling seems moot.

In appeals to the PTAB, there should be no new grounds for rejection in the examiner's answer.  Instead, if the examiner wishes to provide such new grounds, prosecution should be reopened and the examiner should do so in an Office action.  This would motivate examiners to more thoroughly consider how to use the prior art against the claims.  As an alternative, applicants could be given the opportunity to allow the appeal to continue to the PTAB when they wish to rebut the examiner's new grounds without reopening prosecution.

Finally, a very small nit.  Get rid of the 150-word limit on abstracts.  Since abstracts are usually just abridged versions of the broadest claim submitted, they do not serve much of a purpose anyhow.  Increasing this limit to, say, 250 or 300 words would make the transfer of the broadest claim into prose less likely to cause omission of any of that claim's features.

[1] The USPTO touts its Automated Interview Request (AIR) form for requesting interviews without first calling the examiner, but I have found that examiners often do not notice these requests and you end up having to follow it with a phone call anyway.

[2] The unwritten rule of video conferences these days is that no one should be forced to turn on their camera.