Patent Docs: Claim Construction

Claim Construction

September 03, 2019

iNO Therapeutics LLC v. Praxair Distribution Inc. (Fed. Cir. 2019)

Albert Einstein once famously (albeit perhaps apocryphally) said that "[c]ompound interest is the most powerful force in the universe." Not to contradict the creator of 20th Century physics, but it is just as likely that the most powerful force in the universe is the power of unintended consequences. The Federal Circuit illustrated this power in its recent decision in iNo Therapeutics LLC v. Praxair Distribution Inc. with regard to Justice Breyer's exhortation, in his Mayo Collaborative Serv. Inc. v. Prometheus Laboratories opinion, regarding the need to beware of "interpreting patent statutes in ways that make patent eligibility 'depend simply on the draftsman's art' without reference to the 'principles underlying the prohibition against patents for [natural laws],'" citing Flook v. Parker.

Plaintiffs iNO Therapeutics, LLC, Mallinckrodt Hospital Products Inc., and Mallinckrodt Hospital Products IP Inc. asserted U.S. Patent Nos. 8,282,966; 8,293,284; 8,795,741; 8,431,163; and 8,846,112, which the opinion "collectively [termed the] 'heart failure patents' or 'HF patents'" against Praxair Distribution Inc. and Praxair Inc. Plaintiffs also asserted U.S. Patent Nos. 8,573,209; 8,776,794; 8,776,795; 9,265,911; and 9,295,802 which the opinion "collectively [termed the] 'delivery system infrared patents' or 'DSIR patents'" and which were directed to devices for administering nitric oxide gas. As explained in the opinion, inhaled nitric oxide (iNO) gas had been "used to treat infants experiencing hypoxic respiratory failure" since at least the early 1990's. However, in certain cases this treatment results in increased pulmonary edema for infants having a congenital defect, left ventricular hypertrophy. The patents-in-suit were directed to methods and a gas delivery device to ameliorate this side-effect, as exemplified by the following claims:

The '741 patent:

1. A method of treating patients who are candidates for inhaled nitric oxide treatment, which method reduces the risk that inhalation of nitric oxide gas will induce an increase in pulmonary capillary wedge pressure (PCWP) leading to pulmonary edema in neonatal patients with hypoxic respiratory failure, the method comprising:
    (a) identifying a plurality of term or near-term neonatal patients who have hypoxic respiratory failure and are candidates for 20 ppm inhaled nitric oxide treatment;
    (b) determining that a first patient of the plurality does not have left ventricular dysfunction;
    (c) determining that a second patient of the plurality has left ventricular dysfunction, so is at particular risk of increased PCWP leading to pulmonary edema upon treatment with inhaled nitric oxide;
    (d) administering 20 ppm inhaled nitric oxide treatment to the first patient; and
    (e) excluding the second patient from treatment with inhaled nitric oxide, based on the determination that the second patient has left ventricular dysfunction, so is at particular risk of increased PCWP leading to pulmonary edema upon treatment with inhaled nitric oxide.

The '794 patent:

1. A gas delivery device comprising:
    a gas source to provide therapy gas comprising nitric oxide;
    a valve attachable to the gas source, the valve including an inlet and an outlet in fluid communication and a valve actuator to open or close the valve to allow the gas through the valve to a control module that delivers the therapy gas comprising nitric oxide in an amount effective to treat or prevent hypoxic respiratory failure; and
    a circuit including:
    a memory to store gas data comprising one or more of gas identification, gas expiration date and gas concentration; and
    a processor and a transceiver in communication with the memory to send and receive signals to communicate the gas data to the control module that controls gas delivery to a subject and to verify one or more of the gas identification, the gas concentration and that the gas is not expired.

(where the italicized limitations are relevant to the Court's decision). The opinion also notes that the Court had earlier affirmed the PTAB's invalidation of the '112 patent in inter partes review (see "Praxair Distribution, Inc. v. Mallinckrodt Hospital Products IP Ltd. (Fed. Cir. 2018)").

The District Court held the claims of the HF patents to be directed to patent-ineligible subject matter under 35 U.S.C. § 101, and that Praxair did not infringe the claims of the DSIR patents. Mallinckrodt appealed.

The Federal Circuit affirmed-in-part, vacated-in-part, and remanded, in an opinion by Chief Judge Prost joined by Judge Dyk; Judge Newman concurred in part and dissented in part (but the thrust of her opinion dissented from the majority's routine and now conventional, but not capable of being well-understood, affirmance that the claims were not eligible for patenting under § 101). The Court applied its now well-worn (and unnecessarily expansive) interpretation of the Supreme Court's Mayo/Alice test in affirming the District Court. Dissecting the claims in furtherance of its patent-invalidating efforts, the panel majority first states that:

It is undisputed that treatment of infants experiencing hypoxic respiratory failure with iNO gas has existed for decades. The inventors observed an adverse event that iNO gas causes for certain patients. The patent claim does no more than add an instruction to withhold iNO treatment from the identified patients; it does not recite giving any affirmative treatment for the iNO-excluded group, and so it covers a method in which, for the iNO-excluded patients, the body's natural processes are simply allowed to take place. Consequently, the claim here is directed to the natural phenomenon. The claim, apart from the natural phenomenon itself, involves only well-understood, routine, and conventional steps. For the reasons below, claim 1 of the '741 patent fails to recite eligible subject matter.

What follows is the majority's justification for this conclusion. The natural phenomenon is "undisputed" (because the majority defines it as such), the majority saying "[a] neonate patient's body will react to iNO gas in a certain way depending on whether or not the patient has a congenital heart condition called LVD," followed by a recitation of the consequences thereof. The panel majority then parsed the claim language to find that the claims are "directed to" an observation of the natural phenomenon they have defined, because the exclusion (from treatment) step "merely restates the natural law" (nature it seems providing a caregiver who can give the gas as well as knowing without benefit of the invention when to refrain from giving it). According to the majority:

Properly understood, this added step [characterized by Mallinckrodt as an "exclusion" step] is simply an instruction not to act. In effect, the claim is directed to detecting the presence of LVD in a patient and then doing nothing but leaving the natural processes taking place in the body alone for the group of LVD patients. Accordingly, the claim is directed to the natural phenomenon.

And to avoid any correspondence with Vanda Pharmaceuticals Inc. v. West-Ward Pharmaceuticals International Ltd., 887 F.3d 1117 (Fed. Cir. 2018), the majority asserted:

Indeed, Mallinckrodt cannot dispute that the patented method does not propose a new way of treating LVD patients that leverages this discovery (e.g., by titrating the iNO dose). Instead, the claim simply requires that the patient not be treated with iNO. This is significant because a claim not to treat—i.e., not to disturb these naturally-occurring physiological processes within the LVD patient's body—risks monopolizing the natural processes themselves.

And returning to the opinion's theme:

A closer look at the claim language as a whole confirms that the focus of the invention is not on a new way of actually treating the underlying condition of hypoxic respiratory failure. Nor does it recite a way of reducing the risk of pulmonary edema while providing some level of treatment to those patients. Rather, the focus of the invention is screening for a particular adverse condition that, once identified, requires iNO treatment be withheld. A treatment step of administering a prior art dosage is also present. But that step is plainly not the focus of the claimed invention. Mallinckrodt concedes this step is not innovative. Mallinckrodt does not point to "any innovation other than its [purported] discovery of the natural law," citing Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC, 915 F.3d 743, 750 (Fed. Cir. 2019).

The opinion also cites Nat. Alternatives Int'l, Inc. v. Creative Compounds, LLC, 918 F.3d 1338 (Fed. Cir. 2019), and Endo Pharm. Inc. v. Teva Pharm. USA, Inc., 919 F.3d 1347 (Fed. Cir. 2019), in support of the majority's distinction between these claims and what it considers "method of treatment" claims. The panel further distinguished these claims from the patent-eligible claims in Rapid Litigation Management Ltd. v. CellzDirect, Inc., 827 F.3d 1042 (Fed. Cir. 2016) (a decision also written by the Chief), again on the grounds of "a careful reading of the claim language" in those claims and these.

With regard to the second step of the Mayo/Alice test, the panel majority rejected Mallinckrodt's argument that the claims possess an "inventive concept." Following their wont, the majority found nothing sufficiently novel to warrant satisfaction of the second step inquiry. It is a tribute to the essential blurring of statutory lines engendered by Justice Breyer's Mayo decision (but much less understandable or forgivable when the nation's "patent court" does so) that the discussion revolves expressly on lack of novelty in performing the eligibility analysis ("This would be quite a different case if the inventors had invented a new way of titrating the dose" and, citing the District Court (which doesn't take a putatively specialized appellate court to do), "Plaintiffs cannot seriously contend that it is a new practice to exclude certain patients from treatment with a drug when those patients are at an increased risk of experiencing negative side effects from the drug"). Understandably, the majority took frank recourse to what they perceive to be the parallels between these claims and the claims in Mayo to support their decision. And the majority characterized as a "red herring" Mallinckrodt's contentions that their claims do not entirely preempt the putative natural phenomenon, surprising in view of the role preemption plays in justifying the Supreme Court's eligibility requirements in the first place.

The majority's consideration of infringement of the DSIR patents is more legally conventional, involving Mallinckrodt's disagreement with the District Court's construction of the term "verify" in the phrase "verify one or more of the gas identification, the gas concentration and that the gas is not expired." The majority correctly noted that the District Court didn't formally construe the word, giving it its plain and ordinary meaning. The opinion characterizes this argument as Mallinckrodt "attempt[ing] to undo its loss on infringement by redrawing the metes and bounds of the claim" and finds this effort "unavailing."

Providing one basis for Judge Newman to agree with her colleagues, the opinion reversed a "technical error" by the District Court and remanded for correction of the Court's "clerical error" (specifically, issuing a "blanket" judgment on all the claims of the asserted patents rather than limiting it to the asserted claims).

Judge Newman's dissent is directed to the eligibility portion of the decision. In her view, the inventors observed a natural phenomenon and then developed a treatment method that took advantage of that observation to avoid adverse events. "The method that is described and claimed does not exist in nature; it was designed by and is administered by humans" in her view. Procedurally, Judge Newman faults her colleagues because:

The majority improperly separates the claims into old and new steps, describes some claim steps as a "natural phenomenon" and some steps as "well-understood, routine, and conventional steps," and avoids the requirement that a claimed invention is considered as a whole.

And "[t]oday's change of law adds to the inconsistency and unpredictability of this area of patent-supported innovation." In Judge Newman's view "the majority's ruling conflicts with extensive precedent" (which she extensively cites) as well as "the national interest":

The majority [states that] "we emphasize the narrowness of our holding today, which is limited to the particular claims at issue and is driven by the particular circumstances here." This disclaimer appears at the end of a lengthy exposition, whose wide-ranging pronouncements of law and policy are not tied to narrow circumstances or claims. The persistent theme of the majority's analysis is that if a claim contains limitations that concern human physiology, ineligibility arises under section 101, whether or not the claimed method of medical treatment meets the requirement of patentability.

The majority's broad pronouncement of ineligibility of medical treatment that relates to human physiology not only contravenes precedent, but contravenes the national interest in achieving new methods of medical treatment with the assistance of the patent incentive.

Reaching back more than two centuries, Judge Newman reminds her colleagues that patents do not function to "impede scientific and technologic advance," citing Whittemore v. Cutter, 29 F. Cas. 1120, 1121 (C.C.D. Mass. 1813), based on common law and statutory research exemptions, citing her dissent in Integra Lifesciences I, Ltd. v. Merck KGaA, 331 F.3d 860, 875 (Fed. Cir. 2003), and Giles Sutherland Rich in Principles of Patentability, 28 Geo. Wash. L. Rev. 393, 400 (1960) ("It should never be forgotten that patented inventions are published and become a part of the technical literature. This publication itself promotes progress in the useful arts and it is the prospect of patent rights which induces disclosure and the issuance of the patent which makes it available.")

Returning to the majority's blessedly non-precedential opinion, it will bring cold comfort to patent-divested patentees, as well as being somewhat ironic that the upshot of the opinion leads patent prosecutors to the inevitable conclusion that the Federal Circuit is counseling exactly what Justice Breyer cautioned against in Mayo, that we should beware of the clever draftsman who attempts (or worse, succeeds) in obtaining claims that are enforceable and pass the patent eligibility test that the Federal Circuit has crafted, based predominantly on such claim-drafting cleverness. This is not the first time that this has been the outcome of the Federal Circuit's patent eligibility jurisprudence. For example, in In re Roslyn, Judge Dyk's opinion held patent-ineligible claims to Dolly the sheep which was, after all, just a sheep (notwithstanding being a sheep unlike any sheep that had ever lived). But a careful review of that opinion leads ineluctably to the conclusion that, had the draftsman been clever enough (or prescient enough to realize before the fact the quantum and quality of cleverness required) to have claimed a flock of genetically identical sheep, the Court's objections to patent ineligibility would have perforce fallen, because it would be undeniable that flocks of genetically identical sheep do not occur in nature. This state of affairs is frankly Byzantine and antithetical to Congress's purpose (uniformity and predictability in U.S. patent law) for creating the Federal Circuit, as well as being contrary to the principles of clarity and the creation of "bright line rules" that arguably prompted the Supreme Court to begin its heightened scrutiny of the Court and its opinions (if not philosophy). The Federal Circuit's current path is contrary to the idea that patent claims should be readily understandable to well-intended business people and frank (or in current parlance, "efficient") infringers alike and also contrary to the Founders' attitudes regarding patenting as a way to encourage disclosure of new inventions for the public good. Having such a path will give little relief to those who have lost patent rights under the current regime, but at least it provides a way for inventors to obtain patent-eligible claims no matter what other branches of government do in addressing this issue. Innovation, especially in the diagnostic and life sciences arts, requires no more and is entitled to no less.

iNO Therapeutics LLC v. Praxair Distribution Inc. (Fed. Cir. 2019)
Nonprecedential disposition
Panel: Chief Judge Prost and Circuit Judges Newman and Dyk
Opinion by Chief Judge Prost; opinion concurring in part and dissenting in part by Circuit Judge Newman

Posted at 11:59 PM in Claim Construction, Federal Circuit, Patentable Subject Matter | Permalink | Comments (3)

July 23, 2019

Mayne Pharma Int'l v. Merck Sharp & Dohme Corp. (Fed. Cir. 2019)

By Kevin E. Noonan --

The Federal Circuit continued its explication of the circumstances wherein an inter partes review petition is time-barred under 35 U.S.C. § 315(b) in Mayne Pharma Int'l v. Merck Sharp & Dohme Corp., decided earlier this month, and as a bonus, illustrated how including disclosure in a specification for completeness and expanded claim scope can result in an invalidated claim when that scope unnecessarily encompasses the prior art.

The case arose as an appeal from the decision of the Patent Trial and Appeal Board (PTAB) in inter partes review of U.S. Patent No. 6,881,745 that claims 2, 6, and 9-14 are invalid as anticipated or obvious. The '745 patent claims pharmaceutical formulations of azole antifungal drugs having the distinguishing feature that they are almost insoluble in water. This limits their therapeutic effectiveness because it results in poor bioavailability inter alia due to low absorption. The claims of the '745 patent are directed to formulations having improved bioavailability; claim 9 is representative:

A pharmaceutical composition, consisting essentially of:
    about 100 mg of an azole antifungal drug; and
    one or more polymer[s] having acidic functional groups; and
    optionally one or more additional ingredients selected from the group consisting of a disintegrant, a diluent, a filler, an inert solid carrier, an inert solid matrix, a lubricant, a glidant, a colouring agent, a pigment, a flavour, water, ammonia, an alkaline agent, and methylene chloride,
    wherein in vivo the composition provides a mean CMAX of at least 100 ng/ml, after administration in the fasted state.

(where the italicized claim terms are relevant for the issues before the Court). Claims 6, 12, 13, and 14 further require a mean area under the curve (AUC) value of at least 800 ng-h/ml. Although the Board instituted on three grounds, Mayne Pharma cancelled claims 1, 3, 5, and 6, rendering one of the grounds moot. The remaining grounds decided by the PTAB were: 1) that claims 2, 6, 9, 11, 12, and 14 were anticipated by a scientific journal article to Kai, and 2) that these claims and claims 10 and 13 were obvious over the combination of Kai with two additional references (PCT Publication No. WO 98/00113 and European Patent Application No. EP 1027866). Mayne appealed, arguing: 1) that the PTAB had erred because the IPR was time barred under § 315(b), and 2) by not limiting the claims to non-toxic embodiments of the claimed formulations.

The Federal Circuit affirmed, in an opinion by Judge Lourie, joined by Judges Dyk and O'Malley. The circumstances surrounding Mayne Pharma's assertion of the § 315(b) time bar were that the real party in interest was Merck & Co. instead of Merck Sharp & Dohme Corp. (relevant because of earlier litigation outside the one-year limit for instituting an IPR after a complaint alleging patent infringement lawsuit has been served). Mayne Pharma raised this issue throughout the proceedings before the PTAB, starting at the institution phase and throughout the review proceedings. The Board eventually acquiesced, but refused to change the petition filing date, on the grounds that this would both "promote[] the core functions" from the PTAB Trial Practice Guide as well as "serv[ing] the interests of justice." Mayne Pharma argued that the PTAB's own rules, specifically 37 C.F.R. § 42.104, permitted amendments to the petition without penalty regarding the filing date only for "clerical or typographical mistakes," which was not the case here. Merck argued that the issue was beyond the scope of Federal Circuit review under § 314(d) and consistent with the Supreme Court's decision in Cuozzo Speed Technologies, LLC v. Lee, 136 S. Ct. 2131 (2016). In the alternative, Merck argued that the Board ruled within the scope of its discretion in deciding not to alter the petition filing date when adding MCI as the real party in interest. The issue is sufficiently important to the PTAB that the PTO intervened in the appeal in support of Merck's position.

The panel decided that there was no need to address the appealability issue because the § 314(d) bar is not a jurisdictional issue. And in any event, the panel opined that the Board "committed no reversible error" and thus appealability is not an issue. On the merits, the Federal Circuit made reference to the Trial Practice Guide for the purpose of identifying the real party in interest, which is to "identify[] conflicts and assure[] proper application of statutory estoppel." The Board properly found (according to the panel opinion) that there was no evidence of "bad faith, or prejudice to a patent owner caused by the delay," or "intentional concealment, . . . bad faith on MSD's part, [an] attempt to circumvent the estoppel rules, or any other material benefit to it in its delay," permitting amendment to the identify of the real party in interest was "in the interest of justice under § 42.5(c)(3)." After citing the provisions of the Leahy-Smith America Invents Act granting the PTO the discretion to promulgate rules to effectuate Congressional intent regarding inter partes review, and the principles regarding proper judicial deference to administrative agency rulemaking pursuant to Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), the panel affirmed the Board's decision based on the "interests of justice." These interests would not be promoted, in the Court's opinion, by "unwinding the proceedings" and reversing the Board's decision. And the Court further found that the primacy of § 42.104(c) purported by Mayne Pharma in support of reversing the Board was inconsistent with the Board having expressly determined that a petitioner could change the real party in interest without changing the petition filing date in Elekta Inc. v. Varian Med. Sys., Inc., No. IPR 2015-01401, 2015 WL 9898990, at *5 (P.T.A.B. Dec. 31, 2015), and Lumentum Holdings, Inc. v. Capella Photonics, Inc., No. IPR2015-00739, 2016 WL 2736005, at *3 (P.T.A.B. Mar. 4, 2016), as well as the Court's own precedent, citing Wi-Fi One, LLC v. Broadcom Corp., 878 F.3d 1364 (Fed. Cir. 2018).

Turning to the merits of the Board's invalidation decision, the panel noted that the Board had given the claims their broadest reasonable interpretation regarding the term "pharmaceutical composition." Specifically, under this construction the Board considered both toxic and substantially non-toxic embodiments of azole antifungal drugs. Mayne argued that their proffered construction was consistent with the parameters for the claimed formulations set forth in the "wherein" clauses of the challenged claims (referring to the pharmacokinetic characteristics of the claimed formulations in humans). The Board had based its construction on the presence in the specification of toxic azole antifungal drugs such as saperconazole as well as (relatively) non-toxic azole antifungal drugs such as itraconazole. And the "wherein" clauses were not limiting because their effect on claim scope was to limit the claims to "in vivo" applications, which could encompass administration to animals as well as human beings.

Applying this construction to Merck's anticipation and obviousness contentions, the Board found that Kai disclosed all the elements of the claimed formulation as administered to beagle dogs. Regarding the obviousness case, the Board found sufficient motivation to combine the cited references, and a reasonable expectation of success. Finally, the Board considered and rejected secondary considerations of non-obviousness asserted by Mayne Pharma.

The Federal Circuit also affirmed this portion of the Board's decision, applying the substantial evidence standard to the factual portions of the decision and reviewing claim construction de novo. The panel agreed that the claims were not limited to non-toxic azole antifungal formulations, despite the modifier in the claims that these were "pharmaceutical" compositions based on (in hindsight, ill-advised) language in the specification. In view of this language, and the panel's understanding that "few pharmaceuticals are free of toxic effects in some circumstances and dosages," the Federal Circuit found no basis to import a limitation of non-toxicity into the claim. The opinion also credits the Board's understanding that extrinsic evidence supports the Board's construction. Similarly, the panel affirmed the Board's construction not to be limited to administration to humans, in the face of a rather creative argument by Mayne Pharma that "in vivo" applies to plants as well as animals, and the pharmacokinetic properties recited in the claims are "irrelevant" to plants. The Board's construction was consistent with the broadest reasonable interpretation of these claims, according to the opinion, based again on the express language in the specification. The correctness of the Board's claim construction being the only bases for error asserted by Mayne Pharma, the Federal Circuit affirmed the Board's invalidation of the claims of the '745 patent.

Mayne Pharma Int'l v. Merck Sharp & Dohme Corp. (Fed. Cir. 2019)
Panel: Circuit Judges Lourie, Dyk, and O'Malley
Opinion by Circuit Judge Lourie

Posted at 09:58 PM in Claim Construction, Federal Circuit, Novelty, Obviousness, Post-Grant Proceedings | Permalink | Comments (0)

May 14, 2019

IBM Corp. v. Iancu (Fed. Cir. 2019)

Federal Circuit Reverses Board in Two IPR Decisions

By Joseph Herndon --

In International Business Machines Corp. (IBM) v. Iancu, the Federal Circuit found that the Board's interpretation of key claim limitations was incorrect resulting in the Board's decisions having errors.

IBM owns U.S. Patent No. 7,631,346, entitled "Method and System for a Runtime User Account Creation Operation Within a Single-Sign-On Process in a Federated Computing Environment." At the behest of several private companies (who have settled and are not parties here), the U.S. Patent and Trademark Office, acting as delegee of the USPTO Director, instituted two related inter partes reviews (IPRs) of various claims of the '346 patent. In the first IPR, the Board found that claims 1, 3, 12, 14, 15, and 18 are unpatentable because they are anticipated by Japanese Publication No. Tokkai 2004-302907A (Sunada). In the second IPR, the Board found that claims 1, 3, 12, 13, 15, and 18 are unpatentable because they are anticipated by U.S. Patent No. 7,680,819 (Mellmer).

The Federal Circuit vacated and remanded the Sunada IPR decision as being based on an incorrect claim construction of the "federated computing environment" limitation of all claims at issue. In the Mellmer IPR decision, the same claim construction error was found to be present, but did not affect the Federal Circuit's holding to reverse the Board's decision.

The '346 Patent

The specification explains that enterprises try to give their users the benefit of being able to gain access to multiple applications without regard to authentication barriers that protect each particular system supporting those applications. A user might assume that once he or she has been authenticated by some computer system, the authentication should be valid throughout the user's working session, or at least for a particular period of time, without regard to the various computer architecture boundaries that are almost invisible to the user. Among the techniques used to do so are "single-sign-on" (SSO) processes, which aim to require of a user only one authentication process during a particular user session.

The specification explains that user expectations about ease of access are coming to extend beyond the systems within an enterprise to Internet domains of different enterprises so that users can jump from interacting with an application on one Internet domain to another application on another domain without regard to the authentication barriers that protect each particular domain. Thus, to reduce the costs of user management and to improve interoperability among enterprises, federated computing spaces have been created.

The specification then defines the term "federated" as being based on a cooperative relationship among enterprises that falls short of the unitary control available within an enterprise. As enterprises move to support federated business interactions, these enterprises should provide a user experience that reflects the increased cooperation between two businesses. In particular, a user may authenticate to one party that acts as an identity provider and then single-sign-on to a federated business partner.

Claim 1 of the '346 patent recites:

1. A method for managing user authentication within a distributed data processing system, wherein a first system and a second system interact within a federated computing environment and support single-sign-on operations in order to provide access to protected resources, at least one of the first system and the second system comprising a processor, the method comprising:
    triggering a single-sign-on operation on behalf of the user in order to obtain access to a protected resource that is hosted by the second system, wherein the second system requires a user account for the user to complete the single-sign-on operation prior to providing access to the protected resource;
    receiving from the first system at the second system an identifier associated with the user; and
    creating a user account for the user at the second system based at least in part on the received identifier associated with the user after triggering the single-sign-on operation but before generating at the second system a response for accessing the protected resource, wherein the created user account supports single-sign-on operations between the first system and the second system on behalf of the user.

IPR Claim Construction

The disputes here focuses on the "federated computing environment" and "single-sign-on" claim limitations. The Board and the parties agreed that both phrases are limiting, even though the first appears only in the preamble.

The Board recognized that both IBM and the private companies that requested the IPRs ("Petitioner") agreed about what a "federated computing environment" means: "a 'loosely coupled affiliation of enterprises which adhere to certain standards of interoperability; the federation provides a mechanism for trust among those enterprises with respect to certain computational operations for the users within the federation.'"

But, surprisingly, the Board rejected the parties' agreed-on construction "that the scope of the term is limited to an affiliation of enterprises." The Board did so even while recognizing the specification passage stating that "[a] federation is a loosely coupled affiliation of enterprises . . . ." Despite that passage, the Board concluded that a federated computing environment is not limited to enterprises, such as organizations, institutions, etc.

Alternatively, the Board construed "federated computing environment" to mean an environment having a loosely coupled affiliation of entities that adhere to certain standards of interoperability; the federation provides a mechanism for trust among those entities with respect to certain computational operations for the users within the federation. That construction replaces "enterprises" with "entities."

The Board was then able to find that claim element met in Sunada, and the key significance of that replacement is that, under the Board's construction, "two computer systems (or entities) within a single enterprise could disclose a 'federated computer environment.'"

The Federal Circuit concluded that the Board's construction is not reasonable in light of the specification. In the key specification passage quoted above, which is on its face definitional, the patent states that a "federation" is "a loosely coupled affiliation of enterprises." Nothing in the specification contradicts the passage's plain meaning. In fact, the specification describes that a federation is a set of distinct entities, such as enterprises, organizations, institutions, etc., that cooperate to provide a single-sign-on, ease-of-use experience to a user.

The Federal Circuit found that a "system," referring to just the physical equipment and not who controls it or deals with customers in providing access to it, is not of the same type as "enterprises, organizations, institutions."

IPR Decisions

Thus, the Board's final written decision in the Sunada IPR was vacated and remanded for the Board to determine in the first instance whether, under the correct claim construction, Sunada anticipates the claims at issue in that IPR.

With respect to the Mellmer IPR, the Federal Circuit reversed the finding of anticipation. The relevant claim limitation of the '346 patent requires "triggering a single-sign-on operation on behalf of the user in order to obtain access to a protected resource that is hosted by the second system." The Board construed "single-sign-on operation" to mean "a process by which a user is authenticated at a first entity and subsequently not required to perform another authentication before accessing a protected resource at a second entity."

It is undisputed that, under those definitions, a user performs an authentication when the user takes an action that provides credentials, or that plays a role in launching a provision of credentials on the user's behalf, to obtain access to resources. Thus, a "single-sign-on operation" is one that does not require the user to take such action to gain access to a second entity's resources after the user has been authenticated with a first entity.

The Mellmer patent describes a basic architecture for managing digital identity information in a network, such as the Internet. Mellmer teaches techniques for securely logging in to multiple sites with a single password and doing so from any machine on the network. More particularly, Mellmer describes a "DigitalMe" system that, for a user with a DigitalMe ID, eases access to various independent websites (DigitalMe partners) that participate in the system.

The issue here is whether a particular part of the described system requires a second user authentication action to gain access to a DigitalMe partner's resources.

The Federal Circuit found that the Board unreasonably viewed Mellmer and took a login scenario in isolation and out of context. Once the focus was properly widened to understand the whole set of options and scenarios shown, substantial evidence did not support a finding that there is no user action triggering an authentication at the target site.

The Board did not cite, and the Director has not cited, anything in Mellmer that would support a contrary finding. Nor was there any basis for discrediting the testimony of IBM's expert, which was grounded solidly in consideration of the full passages relevant to understanding the entire scenario. The Federal Circuit therefore found that Mellmer does not teach the single-sign-on limitation of the claims at issue in the IPR. Thus, despite the incorrect claim interpretation, that interpretation did not change the finding that Mellmer does not anticipate the claims. The Board's decision in the Mellmer IPR was therefore reversed.

IBM Corp. v. Iancu (Fed. Cir. 2019)
Nonprecedential disposition
Panel: Circuit Judges Moore, Taranto, and Chen
Opinion by Circuit Judge Taranto

Posted at 10:15 PM in Claim Construction, Federal Circuit, Novelty | Permalink | Comments (0)

May 12, 2019

Amgen Inc. v. Sandoz Inc. (Fed. Cir. 2019)

By Kevin E. Noonan --

The latest chapter in the long-running dispute between Amgen and Sandoz over Sandoz's Zarxio® biosimilar to Amgen's Neupogen® biologic drug came to a close last week when the Federal Circuit affirmed grant of summary judgment against Amgen in Amgen Inc. v. Sandoz Inc.

To recap, Amgen's Neupogen® product (filgrastim) is "a recombinant analog of granulocyte-colony stimulating factor ('G-CSF'), a naturally-occurring human glycoprotein that stimulates the production of neutrophils and stem cells and their release into the bloodstream." It is used to treat patients with a deficiency of white blood cells (neutropenia), typically caused by treatment with certain cancer chemotherapeutic agents. In 2014, Sandoz filed an abbreviated biologic license application (aBLA) under the provisions of § 351(k) of the Public Health Service Act (42 U.S.C. § 262(k)) for approval of its Zarxio® biosimilar. However, Sandoz refused to comply with provisions of the Biologic Price Control and Innovation Act (BPCIA) requiring a biosimilar applicant to disclose its application and any relevant manufacturing information to reference product sponsor Amgen. Amgen brought suit but the District Court denied Amgen's motion for preliminary injunction, ruling that such disclosure was not mandatory (see "Gotta Dance? Apparently Not -- A Biosimilar Update"). Amgen appealed to the Federal Circuit, who in a fractured decision agreed with Sandoz (see "Amgen v. Sandoz" and "Federal Circuit Decides Amgen v. Sandoz (in an opinion that will make neither party happy)"). The Supreme Court granted certiorari and also agreed with Sandoz (see "Sandoz Inc. v. Amgen Inc. (2017)"). And upon remand to the Federal Circuit, Amgen lost any chance of obtaining an injunction on the ground that the state law claims (unfair competition among them) asserted by Amgen were preempted by the BPCIA, which contained no provision for an injunction under these circumstances. During this time, the FDA had approved Zarxio® and Sandoz was marketing the Neupogen® biosimilar (see "Sandoz' NEUPOGEN® Biosimilar Now on the Market").

Amgen pursued its patent case on the merits, asserting U.S. Patent Nos. 6,162,427 and 8,940,878. The '427 patent is directed to methods for treating patients in need of peripheral stem cell transplantation; Amgen asserted claim 1 in the District Court action:

1. A method of treating a disease requiring peripheral stem cell transplantation in a patient in need of such treatment, comprising
administering to the patient a hematopoietic stem cell mobilizing-effective amount of G-CSF; and
thereafter administering to the patient a disease treating-effective amount of at least one chemotherapeutic agent.

The '878 patent is directed at protein purification methods using adsorbent chromatography; claim 7 was at issue before the District Court:

7. A method of purifying a protein expressed in a non-native limited solubility form in a non-mammalian expression system comprising:
    (a) expressing a protein in a non-native limited solubility form in a non-mammalian cell;
    (b) lysing a non-mammalian cell;
    (c) solubilizing the expressed protein in a solubilization solution comprising one or more of the following:
        (i) a denaturant;
        (ii) a reductant; and
        (iii) a surfactant;
    (d) forming a refold solution comprising the solubilization solution and a refold buffer, the refold buffer comprising one or more of the following:
        (i) a denaturant;
        (ii) an aggregation suppressor;
        (iii) a protein stabilizer; and
        (iv) a redox component;
    (e) directly applying the refold solution to a separation matrix under conditions suitable for the protein to associate with the matrix;
    (f) washing the separation matrix; and
    (g) eluting the protein from the separation matrix, wherein the separation matrix is a non-affinity resin selected from the group consisting of ion exchange, mixed mode, and a hydrophobic interaction resin.

Central to the issues on appeal was the District Court's claim construction, where the Court construed "disease treating-effective amount of at least one chemotherapeutic agent" in claim 1 of the '427 patent to be limited to "[a]n amount sufficient to treat a disease for which at least one chemotherapeutic agent is prescribed," rejecting Amgen's asserted construction that the amount must be merely sufficient to mobilize stem cells regardless of its effect on the underlying disease. Under this construction, Amgen stipulated Sandoz did not infringe claim 1 of the '427 patent pending appeal to the Federal Circuit.

The District Court construed the terms relating to the "washing" and "eluting" steps of the method claimed in the '878 patent (specifically, subparts (f) and (g)) as being separate steps that required the washing step to be performed before the eluting step. Again, under this construction Amgen conceded it could not prevail on infringement because Sandoz performed these steps concurrently with step (e) (regarding application of the refolding solution). This appeal followed.

The Federal Circuit affirmed, in an opinion by Judge Lourie joined by Judges O'Malley and Reyna. Regarding construction of the claims of the '878 patent, the panel credited Sandoz's argument that the claim "logically requires a series of steps," citing (as did Sandoz) Mformation Technologies, Inc. v. Research in Motion Ltd., 764 F.3d 1392, 1398–1400 (Fed. Cir. 2014) ("a process claim is properly limited to a certain order of steps 'when the claim language, as a matter of logic or grammar, requires that the steps be performed in the order written, or the specification directly or implicitly requires' an order of steps"). The Federal Circuit, like the District Court, rejected Amgen's argument that washing and eluting could be performed simultaneously, for example, under circumstances where "washing may occur toward the bottom of the matrix at the same time that elution occurs toward the top." The Court's reasoning was based in part on the ordered (and sequentially lettered) steps (a) through (g), which "logically" implies they be performed in sequence. This ordered performance of the steps was also consistent with how the process was described in the specification.

Having determined that the District Court's construction was correct as a matter of law (and thus that Sandoz process did not literally infringe claim 7 of the '878 patent), the Federal Circuit then considered infringement under the doctrine of equivalents. Using language that arguably was at least in part responsible for energizing the Supreme Court to review more closely the Federal Circuit's stewardship of the Court's patent jurisprudence (inter alia, in Warner-Jenkinson v. Hilton Davis Chemical Co. and Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co. almost a generation ago), the panel dismissed Amgen's doctrine of equivalents argument saying "[t]he doctrine of equivalents applies only in exceptional cases and is not 'simply the second prong of every infringement charge, regularly available to extend protection beyond the scope of the claims,'" citing its pre-Warner Jenkinson precedent in London v. Carson Pirie Scott & Co., 946 F.2d 1534, 1538 (Fed. Cir. 1991). More correctly (and less provocatively), the panel based its decision on the sound reasoning that "Sandoz does not infringe claim 7 under the doctrine of equivalents because its one-step, one-solution purification process works in a substantially different way from the claimed three-step, three-solution process" recited in Amgen's claims.

The opinion also rejected Amgen's argument that the District Court abused its discretion in not denying or postponing summary judgment under Federal Rule of Civil Procedure 56(d) because Sandoz "intends" (undisputedly), sometime in an uncertain future, to change its purification protocol to (perhaps) an infringing one but has provided neither Amgen nor the FDA with details of its plans. As the Court held in Sunovion Pharm., Inc. v. Teva Pharm. USA, Inc., 731 F.3d 1271, 1279–80 (Fed. Cir. 2013), while district courts cannot ignore amendments to ANDA or aBLA applications in determining whether there is (artificial) infringement under § 271(e)(2), they also have "a broad mandate to render a 'just, speedy, and inexpensive' decision," citing In re Micron Tech., Inc., 875 F.3d 1091, 1100 (Fed. Cir. 2017) (quoting Dietz v. Bouldin, 136 S. Ct. 1885, 1891 (2016)). The opinion discounted Amgen's argument that failure to postpone judgment would deny them of a remedy if Sandoz changed its process to an infringing one, on the grounds that Amgen could pursue a remedy for infringement to the extent that principles of res judicata and collateral estoppel were not violated, citing Bayer AG v. Biovail Corp., 279 F.3d 1340, 1349–50 (Fed. Cir. 2002). Under the circumstances before the Court in this case (particularly because the possible changes Sandoz might make would still not result in an infringing process), the Federal Circuit held the District Court did not abuse its discretion in declining to postpone entry of summary judgment. This aspect of the decision highlights a disparity in information first encountered when Sandoz refused to disclose either its aBLA or manufacturing information under Paragraph 2 of the BPCIA (42 U.S.C. § 262 (l)(2)). The District Court (expressly), the Federal Circuit, and the Supreme Court evinced their presumption that all requisite information could be obtained during discovery in an ensuing lawsuit (disregarding the disadvantage their interpretation of the statute propagated regarding which patent(s) a reference product sponsor such as Amgen should sue on in the absence of this information). Again, here, the Federal Circuit presumes that Amgen will be able to obtain the information necessary to file a well-pleaded complaint in the event Sandoz begins practicing an infringing version of its purification method, without addressing Amgen's argument that there is a possibility that they will not have and will not be able to obtain the information, under circumstances where the Court had at least some leverage to obtain binding representations from Sandoz that this information would be made available should that time come.

Turning to the '427 patent, the panel also affirmed the District Court's construction of the term "disease treating-effective amount of at least one chemotherapeutic agent" to be limited to "[a]n amount sufficient to treat a disease for which at least one chemotherapeutic agent is prescribed." The Federal Circuit rejected Amgen's argument that the amount need not be effective to treat the underlying disease but only be sufficient to mobilize stem cells in blood or bone marrow. The opinion based this construction on the preamble ("A method of treating a disease") and (according to the Court) "neither the claim nor the specification lends support to Amgen's interpretation." Under Amgen's construction, the claim would encompass activities directed solely at mobilizing stem cells, which would require the "disease treatment" to correspond to stem cell mobilization per se. There is no basis for this interpretation in the panel's view, and thus the Court affirmed the District Court's grant of summary judgment.

Amgen Inc. v. Sandoz Inc. (Fed. Cir. 2019)
Panel: Circuit Judges Lourie, O'Malley, and Reyna
Opinion by Circuit Judge Lourie

Posted at 10:13 PM in Claim Construction, Federal Circuit, Infringement - Literal or DOE | Permalink | Comments (1)

January 06, 2019

November 21, 2018

Acceleration Bay, LLC v. Activision Blizzard Inc. (Fed. Cir. 2018)

What is a Printed Publication for Prior Art Purposes?

By Joseph Herndon --

Patent owner Acceleration Bay, LLC ("Acceleration") appealed the final written decisions of the Patent Trial and Appeal Board holding unpatentable claims of U.S. Patent Nos. 6,829,634; 6,701,344; and 6,714,966. Activision Blizzard, Inc., Electronic Arts Inc., Take-Two Interactive Software, Inc., 2k Sports, Inc., and Rockstar Games, Inc. (collectively, "Blizzard") cross-appealed portions of the Board's decisions holding that the Lin article is not a printed publication under 35 U.S.C. § 102(a), among other issues.

Here, we look at the determination of features in a "preamble" as being limitations of the claim, as well as, requirements of an article being considered a printed publication for prior art purposes.

The patents at issue are directed to a broadcast technique in which a broadcast channel overlays a point-to-point communications network. The communications network consists of a graph of point-to-point connections between host computers or "nodes," through which the broadcast channel is implemented.

Blizzard filed six inter partes review ("IPR") petitions—two for each of the '344, '966, and '634 patents—based principally on two different prior art references: one set of IPRs challenged claims based on the Shoubridge article alone or combined with a prior art book Direct-Play ("Shoubridge IPRs"), and another set of IPRs challenged claims based on the Lin article alone or combined with DirectPlay ("Lin IPRs").

The Board instituted an IPR on each petition, on many of the grounds and claims raised, and rendered six final decisions. In the Shoubridge IPRs, the Board determined many claims to be unpatentable, and in the Lin IPRs, the Board concluded that Lin is not a printed publication under 35 U.S.C. § 102(a) and thus determined Blizzard failed to show the challenged claims are unpatentable over Lin.

Shoubridge IPRs

Acceleration appealed portions of the Board's decisions in the Shoubridge IPRs. Claim 1 of the '966 patent is representative of the claim construction disputes in Acceleration's appeal (emphases added):

1. A computer network for providing an information delivery service for a plurality of participants, each participant having connections to at least three neighbor participants, wherein an originating participant sends data to the other participants by sending the data through each of its connections to its neighbor participants and wherein each participant sends data that it receives from a neighbor participant to its other neighbor participants, further wherein the network is m-regular, where m is the exact number of neighbor participants of each participant and further wherein the number of participants is at least two greater than m thus resulting in a non-complete graph.

Claim 1 of the '344 patent is very similar and begins "1. A computer network for providing a game environment for a plurality of participants, ...".

Acceleration argued that the terms "game environment" and "information delivery service," appearing in the '344 and '966 patents, respectively, should have been given patentable weight despite appearing in the preambles because they provide structure for the remainder of the claims. Acceleration alternatively argues that these terms appear in the body of the claims because there is no transition phrase denoting a preamble.

Regarding the latter argument, the Federal Circuit responded that Acceleration's poor claim drafting will not be an excuse for it to infuse confusion into its claim scope, and simply concluded that "game environment" and "information delivery service" are part of the preamble of the claims.

The Federal Circuit noted that there is no beneficial purpose to be served by failing to include a transition word in a claim to clearly delineate the claim's preamble from the body, and it "caution[ed] patentees against doing so."

Then, because the terms at issue appear in preambles, it must be determined whether the terms are limitations. General case law indicates that a preamble limits the invention if it recites essential structure or steps, or is necessary to give life, meaning, and vitality to the claim.

The Federal Circuit agreed with the Board that the claim terms "game environment" and "information delivery service" are non-limiting because they merely describe intended uses for what is otherwise a structurally complete invention. They do not impart any structure into or serve as antecedents for the claims at issue. Instead, they simply provide an intended use for what is otherwise a claim for a network.

Lin IPRs

Blizzard cross-appealed many portions of the Board's decisions in the Lin IPRs, and here we only discuss the issue of whether Lin is a printed publication under § 102(a).

Whether a reference qualifies as a printed publication under § 102 is a legal conclusion based on underlying fact findings. One such fact question is public accessibility. Because there are many ways in which a reference may be disseminated to the interested public, public accessibility has been called the touchstone in determining whether a reference constitutes a printed publication.

Case law has indicated that a reference is considered publicly accessible if it was disseminated or otherwise made available to the extent that persons interested and ordinarily skilled in the subject matter or art, exercising reasonable diligence, can locate it.

The Board found that Lin was not publicly accessible before the critical date.

Based on the testimony of Glenn Little, a Systems Administrator at the Computer Science and Engineering ("CSE") department of the University of California, San Diego ("UCSD"), the Board found that Lin had been uploaded to the CSE Technical Reports Library's website as of November 23, 1999, which is not challenged on appeal. As the Board explained, according to Mr. Little, "the CSE department regularly maintains electronic technical reports and records concerning those reports, and a staff member assigns a unique identifier to each report based on the year it was uploaded and the relative order it was uploaded in comparison to other papers."

The Board then noted that public accessibility requires more than technical accessibility. Because there was no evidence that Lin was disseminated to the public, the Board focused on whether an interested skilled artisan, using reasonable diligence, would have found Lin on the CSE Technical Reports Library website. The Board found that despite some indexing and search functionality on the website, Lin was not publicly accessible. It found the website allowed a user to view a list of technical reports indexed only by author or year and that there was no evidence as to how many reports were in the Library's database in 1999. The Board determined that at best, Blizzard's evidence suggests that an artisan might have located Lin by skimming through potentially hundreds of titles in the same year, with most containing unrelated subject matter, or by viewing all titles in the database listed by author, when the authors were not particularly well known. The Board also found the website's advanced search form to be deficient. It found that while the advanced search form appeared to allow a user to search keywords for author, title, and abstract fields, evidence demonstrated that functionality was not reliable. In sum, the Board determined that Blizzard had not shown sufficiently that the UCSD CSE Technical Reports Library was searchable or indexed in a meaningful way so that a person of ordinary skill in the art would have located Lin. The Board, therefore, concluded Lin is not a printed publication under § 102(a).

The Federal Circuit found no error in the Board's reasoning. Namely, the Federal Circuit found that substantial evidence supports the Board's findings that Lin was not publicly accessible, including that Lin was not indexed in a meaningful way and that the website's advanced search form was deficient. Mr. Little testified he does not know how the search works or how keywords are generated, that he never searched for Lin using the advanced search form, and that it was not the CSE department's practice to verify the advanced search capability for title and abstract when a new article was uploaded. Mr. Little also admitted it was possible the search function did not work.

Acceleration also presented evidence that a recent advanced search for keywords in the title and abstract of Lin failed to produce any results.

Blizzard argued these results are unauthenticated hearsay and are based on searches conducted years after the critical date, but Mr. Little testified that as to the website, "[i]t's pretty much the same, actually, between [1999] and now. We're running the same software." The Federal Circuit found no reason to discount the Board's weighing of the evidence. Substantial evidence was thus found to support the Board's finding that there was insufficient evidence of record to support a finding that a person of ordinary skill in the art in 1999 could have located Lin using the CSE Library website's search function.

The Federal Circuit thus distinguished a similar case: In re Lister, 583 F.3d 1307 (Fed. Cir. 2009). In Lister, a reasonably diligent researcher with access to a database that permits the searching of titles by keyword would be able to attempt several searches using a variety of keyword combinations, and thus, the manuscript at issue was publicly accessible as of the date it was included in databases that permitted keyword searching of titles.

The Federal Circuit noted that unlike in Lister, here the record supports the Board's finding that the CSE Library website's advanced search function did not successfully permit keyword searching of titles, a key feature in Lister. The Board's fact finding that, with available reports indexed only by author or year, Lin was not meaningfully indexed, was found to be supported by substantial evidence.

Blizzard argued that because Lin was indexed by title for a given year, author name, and unique sequence number, that was sufficient for public accessibility. But, the Federal Circuit stated that the test for public accessibility is not "has the reference been indexed?" Where indexing is concerned, whether online or in tangible media, the ultimate question has been whether the reference was available to the extent that persons interested and ordinarily skilled in the subject matter or art, exercising reasonable diligence, can locate it.

Here, the Board found that although Lin was indexed by author and year, it was not meaningfully indexed such that an interested artisan exercising reasonable diligence would have found it, which is a proper consideration under the Federal Circuit precedent. As such, the Federal Circuit found that Lin was not a printed publication under § 102.

Acceleration Bay, LLC v. Activision Blizzard Inc. (Fed. Cir. 2018)
Panel: Chief Judge Prost and Circuit Judges Moore and Reyna
Opinion by Circuit Judge Moore

Posted at 11:32 PM in Claim Construction, Federal Circuit, Novelty | Permalink | Comments (0)

August 30, 2017

In re McAward (PTAB 2017)

By Kevin E. Noonan --

Patent law can be apparently inconsistent, particularly where claim construction is concerned. For example, claim construction standards that apply in district court are not the same standards that the U.S. Patent and Trademark Office applies during examination; the rationale for the difference is a mixture of a patent having a presumption of validity that claims undergoing examination (or the various flavors of re-examination or review) do not, as well as the gatekeeping function of the Office in granting claims commensurate in scope with an applicant's disclosure.

Another area where there are differences between the Office and district courts is in applying the law of indefiniteness, i.e. determining whether claims satisfy the requirements of 35 U.S.C. § 112, second paragraph (renamed § 112(b) under the Leahy-Smith American Invents Act). The Supreme Court opined on the standard district courts should apply in Nautilus, Inc. v. Biosig Instruments, Inc., 572 U.S._, 134 S. Ct. 2120 (2014); in this precedential opinion, the Patent Trial and Appeal Board (PTAB) provided the Board's view on how the statute should be applied by the Office and the impact vel non of the Court's Nautilus decision on the Office with regard to the indefiniteness standard.

The claims of the application on appeal, U.S. Serial No. 13/435,655 to McAward et al., were directed to "water leakage detectors . . . which are easily connectable to flexible water hoses, and, can be coupled together to monitor leakage from hot and cold supplies." All claims were rejected; claim 1 being representative (with italics added):

1. A water detector comprising:
    a housing;
    flow connectors carried by the housing including a spin on female pipe connector at an inflow end and a spin-on male pipe connector on an outflow end;
    at least one water presence sensor carried by the housing;
    an electrically actuatable valve, carried by the housing, and having first and second states; and
    control circuits, carried by the housing, coupled to the sensor and valve, and, responsive to a leakage indicating signal from the sensor, the circuits actuate the valve causing it to change state wherein the control circuits detect flood conditions, shut off a malfunctioning water branch to a home appliance and communicate to a premises alarm communication device or home automation system via a wireless link and wherein the water detector is configured to be reliably installed by an untrained installer or a homeowner and to not require the services of a plumber or electrician to perform installation, thereby permitting widespread and cost effective adoption.

The italicized limitation was recited by the Examiner as being indefinite under 35 U.S.C. § 112, second paragraph. The Examiner asserted that the metes and bounds of this claim could not be understood by the person of ordinary skill in the art because "the claim language does not provide any structure to the apparatus or system that would allow it to be 'configured' to function as described in the claims."

This rejection was affirmed by the PTAB in a precedential decision in which the Board reaffirmed its application of the indefiniteness requirement in light of the Supreme Court's decision in Nautilus. In the opinion, the PTAB reiterates the PTO's role in having the initial burden of presenting a prima facie case of indefiniteness to reject claims on this basis, citing Hyatt v. Dudas, 492 F.3d 1365, 1369-70 (Fed. Cir. 2007), and In re Oetiker, 977 F.2d 1443, 1445 (Fed. Cir. 1992). This exercise requires claim construction (In re Zietz, 893 F.2d 319, 321-22 (Fed. Cir. 1989)) and that raised the issue of the claim construction standard the Office should use. The Board reiterated that the proper standard is the broadest reasonable interpretation (BRI) construction (In re Am. Acad. of Sci. Tech Ctr., 367 F.3d 1359, 1364 (Fed. Cir. 2004) (cited with approval in Phillips v. A WH Corp., 415 F.3d 1303, 1316 (Fed. Cir. 2005) (en banc)). Citing In re Packard, 751F.3d1307, 1311-12 (Fed. Cir. 2014) (per curiam), the opinion sets forth the rationale for this standard:

During prosecution, an examiner's indefiniteness rejection begins what is intended to be an interactive process in which the applicant has the opportunity to respond to the examiner by amending the claims or by providing evidence or explanation that shows why the claims are not indefinite.

This reasoning supports the Office's role in ensuring that the claims are "clear, unambiguous, and drafted as precisely as the art allows" so that "the rights afforded by patents [are] commensurate with the invention's contribution to the art," citing. Packard, 751 F.3d at 1313. Using BRI permits the Office to "fulfill this important role" according to the opinion, citing In re Buszard, 504 F.3d 1364, 1366 (Fed. Cir. 2007). An applicant has the opportunity to respond to such a rejection by amending claims to satisfy the § 112 requirements, citing In re Yamamoto, 740 F.2d 1569, 1571 (Fed. Cir. 1984) (and quoting In re Prater, 415 F.2d 1393, 1405 (CCPA 1969)). The Board further asserted that the Office's use of BRI was approved by the Supreme Court in Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2146 (2016), as being authorized under the Office's rulemaking authority. In Cuozzo, the Court's approval was grounded on the understanding that such a system protects the public by avoiding "overly broad claims" and "tying up too much knowledge."

And In re Morris, 127 F.3d 1048, 1054 (Fed. Cir. 1997), is consistent with this view:

We note that the patent drafter is in the best position to resolve the ambiguity in the patent claims, and it is highly desirable that patent examiners demand that applicants do so in appropriate circumstances so that the patent can be amended during prosecution rather than attempting to resolve the ambiguity in litigation.

Citing In re Packard, the opinion characterizes this regime as an approach that "fundamentally differs" from a court's role -- one that "effectively results in a lower threshold for ambiguity than a court's":

The different approaches to indefiniteness before the Office and the courts stem not from divergent interpretations of § 112, but from the distinct roles that the Office and the courts play in the patent system. The lower threshold makes good sense during patent examination because the patent record is in development and not fixed, the Office construes claims broadly during that period, and an applicant may freely amend claims.

Nautilus, which was decided after Packard, is not contrary: "We do not understand Nautilus, however, to mandate a change in the Office's approach to indefiniteness in patent-examination matters in which, as discussed above, the claims are interpreted under the broadest reasonable interpretation standard and an opportunity to amend the claims is afforded." The government's position has been consistent, in its amicus in Nautilus and in opposing a writ of certiorari in Packard.

The PTO standard from Packard controls: "[a] claim is indefinite when it contains words or phrases whose meaning is unclear." 751 F.3d at 1310, 1314. Put differently, "claims are required to be cast in clear-as opposed to ambiguous, vague, indefinite-terms":

[W]hen the USPTO has initially issued a well-grounded rejection that identifies ways in which language in a claim is ambiguous, vague, incoherent, opaque, or otherwise unclear in describing and defining the claimed invention, and thereafter the applicant fails to provide a satisfactory response, the USPTO can properly reject the claim as failing to meet the statutory requirements of § 112(b). MPEP § 2173.02(1).

In applying these principles, the Board found that the claims are indefinite because "the claim language attempts to further define the water detector's structure by the skill level required to install the water detector" rather than "further defining the water detector's structure," which the opinion terms "unusual." For this reason, the claim language "fails to provide adequate clarity to the required structure" because the skill level of "an untrained installer or a homeowner" is "ambiguous and vague." The definitions the Applicant argued on appeal for the meaning of the term were not found in the specification according to the Board's opinion, particular with regard to the knowledge or tools needed for installing the claimed water detector. As with many such indefiniteness problems, here the wide variability in skill levels among "an untrained installer or a homeowner" robbed the phrase of the clarity required by the statute. In addition, the Board found that the specification did not provide a basis for determining what the term "configured" meant in the context of the disputed limitation. These deficiencies extended to both the plumbing and electrical components of the claimed device according to the Board.

The Board also affirmed rejection of all pending claims on obviousness grounds, construing narrowly the terms determined to be indefinite where, even under such a construction the claims were found to be obvious.

Posted at 11:47 PM in Claim Construction, Definiteness, Patent Trial and Appeal Board | Permalink | Comments (6)

August 07, 2017

Enzo Biochem Inc. v. Applera Corp. (Fed. Cir. 2017)

By Donald Zuhn --

Last week, in Enzo Biochem Inc. v. Applera Corp., the Federal Circuit determined that the District Court for the District of Connecticut accurately interpreted the Federal Circuit's decision in Enzo Biochem, Inc. v. Applera Corp. (Enzo II), 780 F.3d 1149 (Fed. Cir. 2015), concerning the proper construction of the claims in U.S. Patent No. 5,449,767, and correctly analyzed the doctrine of equivalents argument of Plaintiffs-Appellants Enzo Biochem, Inc., Enzo Life Sciences, Inc., and Yale University ("Enzo"). The District Court had found that the Federal Circuit's decision in Enzo II applied to all of the claims in the '767 patent, and not just claim 1 as Enzo had asserted, and had rejected Enzo's argument that the claims covered direct detection (in addition to indirect detection) under the doctrine of equivalents. The Federal Circuit affirmed both determinations by the District Court.

The opinion begins by noting that the Federal Circuit had considered the infringement action between Enzo and Defendants-Appellees Applera Corp. and Tropix, Inc. ("Applera") on three separate occasions over thirteen years. The dispute began in 2004, when Enzo filed suit against Applera alleging infringement of six patents, including the '767 patent. The '767 patent is directed to the use of nucleotide probes to detect the presence of a particular DNA or RNA sequence in a sample or to identify an otherwise unknown DNA sequence. Such detection occurs via hybridization of the probes with the DNA or RNA sequence of interest, wherein hybridization of the probe and target sequence may be directly detected (by using a labeled probe) or indirectly detected (by using a secondary chemical agent that is bound to the labeled probe).

After a jury found that Applera infringed claims 1, 8, 67, 68, and 70 of the '767 patent, Applera appealed, arguing that the District Court had erred in construing the claims to only cover indirect detection. The Federal Circuit in Enzo II reversed, concluding that "the inventors were claiming only indirect detection," and therefore that the District Court had erred in construing the claims to cover both direct and indirect detection. On remand, the District Court granted Applera's motion for summary judgment of noninfringement, determining that Enzo II applied to all of the claims of the '767 patent and rejecting Enzo's doctrine of equivalents argument. Enzo appealed the District Court's judgment to the Federal Circuit.

With respect to Enzo's argument that the District Court incorrectly interpreted the Federal Circuit's decision in Enzo II as applying to all of the claims of the '767 patent, with Enzo asserting that Enzo II should only apply to claim 1, the panel concluded that:

[A]fter carefully parsing our decision, the district court correctly interpreted Enzo II. As the district court explained, Enzo II consistently refers to the "claims" at issue in that appeal, which extended beyond claim 1 to include claims 8, 67, 68, and 70. . . . For example, our opinion in Enzo II, after acknowledging that Enzo had asserted claims 1, 8, 67, 68, and 70, states that the district court "erred in its claim construction by finding that the claims at issue covered direct detection" [emphasis in original].

As for Enzo's argument that Applera infringed claims 1 and 8 under the doctrine of equivalents, the panel notes that "[t]he district court explained that the patent 'describes its method of indirect detection as a superior means of detection as compared to direct detection, with 'detection capacities equal to or greater than products which utilize' direct detection,'" and determined that "Enzo's attempt to reframe its infringement case under the doctrine of equivalents runs headfirst into our decision in Enzo II," where the Federal Circuit found that the claims covered only indirect detection. As a result, the opinion concludes that "Enzo's attempt to incorporate direct detection methods now through the doctrine of equivalents fails."

Finding that the District Court properly interpreted Enzo II as applying to all of the claims of the '767 patent, and further, that the District Court correctly held that Applera's accused products using direct detection did not infringe Enzo's '767 patent claiming indirect detection, the Federal Circuit affirmed the District Court's judgment.

Enzo Biochem Inc. v. Applera Corp. (Fed. Cir. 2017)
Nonprecedential disposition
Panel: Chief Judge Prost and Circuit Judges O'Malley and Wallach
Opinion by Circuit Judge O'Malley

Posted at 11:38 PM in Claim Construction, Infringement - Literal or DOE | Permalink | Comments (0)

July 16, 2017

Securus Technologies, Inc. v. Global Tel*Link Corp. (Fed. Cir. 2017)

By Michael Borella --

Over the last 18 months, the Federal Circuit has been quietly shoring up the non-obviousness provisions of 35 U.S.C. § 103 by enforcing the requirement that an obviousness argument entails making the full prima facie case. That is, in order to invalidate a claim over two or more prior art references, the challenger needs to (i) establish that all elements of the claim are either present in or suggested by the prior art, (ii) that one of ordinary skill in the art would be motivated to combine these references in a fashion that would result in the claimed invention, and (iii) had a reasonable expectation of success in doing so.

All too often, attacking these two final steps of the obviousness analysis are left out in a § 103 rebuttal. This is hardly surprising, given that many USPTO examiners seem to believe that merely stating that references could be combined (and perhaps providing a terse explanation of the reasons for doing so) is sufficient to establish the motivation prong of the prima facie case. During interviews and in written arguments, it is typically much easier to convince an examiner to withdraw a § 103 rejection by arguing that the references do not teach a particular claim element.

Before the Patent Trial and Appeal Board (PTAB) things can be different. PTAB judges are more open to rebuttals of the challenger's motivation to combine. Thus, patentees are more likely to emphasize such arguments. Nonetheless, the Federal Circuit has had to frequently correct the PTAB's misapplication of this nuance, especially of late (see "Personal Web Technologies, LLC v. Apple, Inc. (Fed. Cir. 2017)" as just one recent example). This case is an example of the Federal Circuit affirming a PTAB decision that "got it right" with respect to § 103.

Petitioner Securus appealed a final written decision from the PTAB in an inter partes review (IPR) of Global Tel*Link's U.S. Patent No. 7,853,243. The PTAB had ruled that Securus did not make out a proper prima facie case of obviousness.

The '243 patent "relates to a secure telephone call management system that can authenticate the identity of users seeking to make a telephone call from the inside of penal institutions or similar facilities." Particularly, the "system authenticates users before they attempt to make a phone call by requiring a user to first supply his or her pre-assigned personal identification number (PIN), as well as certain biometric data." The biometric data can be fingerprints, voiceprints, retinal scans, etc.

Claim 1 of the '243 patent recites:

1. A method for restricting access to a public telephone network using a telephone call management system, said method comprising the steps of:
    assigning a first identification number to each of a plurality of potential callers;
    recording a first voice print of at least one potential caller;
    storing said first voice print and said first identification number in a database;
    during each access attempt to said public telephone network by said potential caller:
    prompting said at least one potential caller to input a second identification number;
    recording a second voice print of said at least one potential caller;
    matching said first and second identification numbers;
    comparing said second voice print with said first voice print associated with said first identification number;
    granting said at least one potential caller access to said public telephone network to attempt to place a telephone call if said second voice print matches said first voice print;
    monitoring at least one conversation to detect the presence of a three-way call attempt; and
    recording at least one conversation between said at least one potential caller and a third-party remotely located from said at least one potential caller if said recording is permissible; and
    detecting the presence of predetermined keywords in audio of said at least one conversation.

Notably, the "during" step ends with a colon rather than a semicolon. This subtlety is easy to miss, but turned out to be important even if not determinative.

Securus argued that claim 1 was obvious over the combination of two references, Susen and Gainsboro. Susen "generally discloses the use of voice recognition to verify users before they can access a particular line on [a] PBX or mobile terminals," where "[v]oice recognition can be used in conjunction with PINs in the verification process." Gainsboro "addresses the problem of having employees of [penal] institutions review recorded phone calls for suspicious behavior." These phone calls are made by the inmate. Further, "[Gainsboro] includes automatic speech recognition (ASR) technology to existing telephone systems in these institutions so as to eliminate the need for these employees."

The Court first reviewed a claim construction dispute. Securus took the position that the "during" step only includes the immediately following "prompting" step, because the former ends with the colon as noted above and the later ends with a semicolon. The "recording" step and all following steps would not be part of this combined "during" step. In other words, Securus asserted that a proper construction of claim 1 would be:

In contrast, Global Tel*Link's proposed construction was that the "during" step incorporated the next five steps. This construction would read as follows:

                    * * *
    storing said first voice print and said first identification number in a database;
    during each access attempt to said public telephone network by said potential caller: prompting said at least one potential caller to input a second identification number; recording a second voice print of said at least one potential caller; recording a second voice print of said at least one potential caller; matching said first and second identification numbers; comparing said second voice print with said first voice print associated with said first identification number; granting said at least one potential caller access to said public telephone network to attempt to place a telephone call if said second voice print matches said first voice print;
    monitoring at least one conversation to detect the presence of a three-way call attempt; and
                    * * *

The PTAB adopted Global Tel*Link's construction and found that the relevant reference, Susen, did not disclose all of these steps. The Court agreed, noting that "the most natural reading of the [during] limitation is one that incorporates all the steps from the beginning of the attempt to access the telephone network to the end of that attempt," which includes all five elements following the "during" step. The Court found that this construction was logical and explicitly supported by the specification.

The PTAB also ruled that Securus "failed to explain why a person of ordinary skill in the art (skilled artisan) would combine Susen and Gainsboro to arrive at the claimed invention." Securus challenged this part of decision as well.

The Court set forth the controlling law, noting that "it is not enough to simply show that the prior art references disclose the claim limitations; in addition, it can be important to identify a reason that would have prompted the skilled artisan to combine the elements as the new invention does." Securus contended that since "[b]oth prior art patents are in the same field of telecommunications monitoring and control," one skilled in the art "would be motivated to combine Susen with Gainsboro to include monitoring said telephone call for a hook flash indicative of three-way calling."

The Court agreed with the PTAB, observing that "Securus' case against the patentability of the claimed invention amounts to mere conclusory statements, which fall short of some articulated reasoning with some rational underpinning to support the legal conclusion of obviousness" as required by § 103. Continuing, the Court wrote that "Securus failed to explain how or why the skilled artisan would combine the teachings of Susen, which are generally directed to authorizing telephone access through voice recognition in corporate settings, with the teachings of Gainsboro, which are generally directed to listening in on and reviewing phone conversations in penal settings, to arrive at the claimed invention." Moreover, "a broad characterization of Susen and Gainsboro as both falling within the same alleged field of telecommunications monitoring and control, without more, is not enough for Securus to meet its burden of presenting a sufficient rationale to support an obviousness conclusion . . . [s]uch short-cut logic would lead to the conclusion that any and all combinations of elements known in this broad field would automatically be obvious, without the need for any further analysis."

Consequently, the Court upheld the PTAB's decision that Securus did not meet its burden to establish that the claims were obvious.

There are two main take home points to this case. The most important one should be obvious (pun intended) -- when making obviousness contentions, a well-reasoned motivation to combine must be present. The second is that claim formatting matters. Especially in software claims where there are steps and sub-steps, it can be important to make sure the claim structure itself clearly spells out these relationships. Some practitioners use enumeration, others use indentation or other types of formatting. Both have their pros and cons. Here, Global Tel*Link was fortunate that the PTAB and the Court saw things its way. But patentees should not count on the proper structure being imposed on claims that might not be 100% clear on their face.

Securus Technologies, Inc. v. Global Tel*Link Corp. (Fed. Cir. 2017)
Nonprecedential disposition
Panel: Circuit Judges Newman, Chen, and Stoll
Opinion by Circuit Judge Chen

Posted at 10:16 PM in Claim Construction, Federal Circuit, Obviousness | Permalink | Comments (6)

July 03, 2017

Samsung Electronics Co. v. Straight Path IP Group, Inc. (Fed. Cir. 2017)

By Joseph Herndon --

In a nonprecedential decision, the Federal Circuit affirmed a decision by the Patent Trial and Appeal Board in inter partes review proceedings which upheld the patentability of claims due to construction of the claim term "is connected to the computer nework". Namely, Samsung Electronics as well as a number of other companies (Cisco Systems, Avaya, LG Electronics, Toshiba Corp., VIZIO, Hulu, and Verizon) appealed from final written decisions of the Patent Trial and Appeal Board in inter partes review proceedings of U.S. Patent Nos. 6,108,704 ('704 patent); 6,009,469 ('469 patent); and 6,131,121 ('121 patent). In its final written decisions, the Board upheld the validity of all instituted claims, and the Federal Circuit affirmed the Board's decision.

The '704 Patent

The '704 patent, entitled "Point-to-Point Internet Protocol," generally relates to establishing a point-to-point communication link. The '469 patent and the '121 patent are continuations-in-part of the '704 patent. The specifications for the three challenged patents are largely identical. The '469 patent, entitled "Graphic User Interface for Internet Telephony Application," and the '121 patent, entitled "Point-to-Point Computer Network Communication Utility Utilizing Dynamically Assigned Network Protocol Addresses," both relate to facilitating audio communications over computer networks. Each patent explains that a first processing unit automatically transmits its associated e-mail address and IP address to a connection server. The connection server stores the addresses in a database and, in so doing, establishes the first processing unit as an active on-line party available for communication. The first processing unit sends a query to the connection server, which searches the database to determine whether a second processing unit (e.g., callee) is active and on-line. If the callee is active and online, the connection server sends the IP address of the callee from the database to the first processing unit, i.e., performs a point-to-point Internet protocol communication. The first processing unit then directly establishes the point-to-point Internet communication with the callee using the retrieved IP address. Claim 1 of the '704 patent, which is representative of the claims at issue in this appeal, recites:

1. A computer program product for use with a computer system, the computer system executing a first process and operatively connectable to a second process and a server over a computer network, the computer program product comprising:
    a computer usable medium having program code embodied in the medium, the program code comprising:
        program code for transmitting to the server a network protocol address received by the first process following connection to the computer network;
        program code for transmitting, to the server, a query as to whether the second process is connected to the computer network;
        program code for receiving a network protocol address of the second process from the server, when the second process is connected to the computer network; and
        program code, responsive to the network protocol address of the second process, for establishing a point-to-point communication link between the first process and the second process over the computer network.

First Inter Partes Review

In an earlier-filed petition for inter partes review, another petitioner, Sipnet EU S.R.O., challenged claims of the '704 patent over the same prior art references that were at issue in this appeal. In the Sipnet IPR, the Board concluded that claim 1 of the '704 patent, among others, was unpatentable as anticipated by each of the prior art references. Straight Path appealed that decision on the grounds that the Sipnet Board misconstrued the claim term "is connected to the computer network" to mean "active and on-line at registration." Straight Path IP Grp., Inc. v. Sipnet EU S.R.O., 806 F.3d 1356, 1360 (Fed. Cir. 2015). The Federal Circuit rejected the Board's claim construction and construed "is connected to the computer network" to mean "is connected to the computer network at the time that the query is transmitted to the server."

In construing the disputed claim limitation, the Federal Circuit first looked to the plain meaning of the claim language and concluded that the present tense "is" in "is connected to the computer network" plainly says that the query transmitted to the server seeks to determine whether the second unit is connected at that time, i.e., connected at the time that the query is sent. The query does not seek to determine whether the device was connected or whether it is still registered as being connected even if that registration information is no longer accurate. Thus, the Federal Circuit concluded that the claim language is not satisfied by a query that asks only for registration information, regardless of its current accuracy.

The Federal Circuit concluded that the specification does not provide a basis for adopting a construction that contradicts the plain meaning of the claim language.

Second Inter Partes Review

Returning to the present case, Samsung et. al. requested inter partes review of claims of the '704 patent, as well as claims of the '469 patent and the '121 patent, and challenged the claims at issue under 35 U.S.C. § 103(a) over a combination of references. The two references at issue are the Microsoft Windows NT 3.5, TCP/IP User Guide (1994) ("WINS") and The Open Group, Technical Standard, Protocols For X/Open PC Interworking: SMB, Version 2.0 (1992) ("NetBIOS").

The Board found that WINS and NetBIOS both describe name server technology. In particular, NetBIOS is a software interface that allows applications on different computers to communicate within a computer network, such as a local area network or the Internet. The NetBIOS name service stores registered names in a database, and a name query transaction can be initiated by an end-node in an attempt to obtain the IP address associated with a NetBIOS name. If the NetBIOS Name Server has information regarding a queried node, the NetBIOS Name Server transmits a positive response. If the NetBIOS Name Server does not have information regarding a queried node, the NetBIOS Name Server transmits a negative response. Once the IP addresses have been found for a target name, a NetBIOS session service begins. The NetBIOS session service involves directed (point-to-point) communications.

WINS is an implementation of NetBIOS. When a computer's name is registered with the WINS server, the server accepts the entry with a timestamp, an incremental unique version number, and other information. Once a computer is registered with the WINS server as active and on-line, the WINS server maintains a database of names and addresses as active and on-line by (1) releasing names once a computer is shut down properly, and (2) requiring a renewal time period in which a computer must reregister.

In its final decision, the Board adopted the Federal Circuit's prior claim construction of the phrase "is connected to the computer network" and construed it to mean "is connected to the computer network at the time that the query is transmitted to the server." The Board determined that neither the WINS reference nor the NetBIOS reference discloses the claimed "is connected to the computer network" limitation. Accordingly, the Board concluded that Appellants failed to show by a preponderance of the evidence that any of the instituted claims reciting the limitation "connected to the network" (or the counterpart claim phrases) are unpatentable.

Samsung Appeal

On appeal, Samsung argued that the Board's application of the prior claim construction was impermissible as a matter of law because the Board added a limitation not found in the claim when it purportedly required that the prior art references demonstrate "perfect accuracy" when querying whether a process is connected to the computer network.

In particular, Samsung contended that the Board found that the prior art did not satisfy the disputed limitation only because of a possible circumstance in which the WINS database may no longer be accurate, and in which the name server may be incorrect.

But Straight Path argued that not only is the prior art not designed to keep track of current online status, it is not designed to check online status when responding to a query for a user's IP address.

The Federal Circuit agreed with Straight Path and found that the Board did not import an additional "perfect accuracy" limitation. The Federal Circuit found that neither reference tracks a user's online status. The Board determined that neither WINS nor NetBIOS will determine whether the second process is connected to the computer network at the time the query is transmitted to the server, i.e., whether a user is on-line at the relevant time.

This conclusion was considered to be supported by substantial evidence. The Board determined that the references disclose that the name servers have information that a process "was" connected to the computer network. But this does not meet the claim limitation. WINS and NetBIOS both disclose querying a name server for the registered address of the callee computer. This is not sufficient though. The Federal Circuit noted that a query that asks only for registration information, regardless of its current accuracy, will not satisfy the claim limitation.

The outcome here is somewhat surprising. The prior art appears to be very close, and one would imagine that during prosecution, such a rejection under 35 U.S.C. § 103 would most certainly be upheld by a patent examiner. Here, the subtle difference of when the status check is performed was enough to distinguish over the prior art, however.

Samsung Electronics Co. v. Straight Path IP Group, Inc. (Fed. Cir. 2017)
Nonprecedential disposition
Panel: Chief Judge Prost and Circuit Judges O'Malley and Wallach
Opinion by Chief Judge Prost

Posted at 11:13 PM in Claim Construction, Federal Circuit, Patent Trial and Appeal Board | Permalink | Comments (0)

May 08, 2017

Braintree Laboratories, Inc. v. Breckenridge Pharmaceutical, Inc. (Fed. Cir. 2017)

By Kevin E. Noonan --

The Federal Circuit's decision on Friday, in Braintree Laboratories, Inc. v. Breckenridge Pharmaceutical, Inc., illustrates the risks a litigant can take when agreeing to a stipulation in an effort at least to reduce litigation costs and issues presented at trial.

The case involved ANDA litigation over ANDA defendant Breckenridge Labs' generic version of Braintree's bowel preparation kit (SUPREP), sold to purge a patient's colon prior to inter alia colonoscopy. The formulation as sold by Braintree comprises "two six-ounce bottles of an aqueous hypertonic solution of potassium sulfate, magnesium sulfate, and sodium sulfate," which according to the FDA-approved label are filled to 16 ounces prior to consumption (which occurs once in the evening before the procedure and once the morning of a colonoscopy). Claim 15 of Braintree's patent in suit (U.S. Patent No. 6,946,149) is representative:

A composition for inducing purgation of the colon of a patient, the composition comprising from about 100 ml to about 500 ml of an aqueous hypertonic solution comprising an effective amount of Na₂SO₄, an effective amount of MgSO₄, and an effective amount of K₂SO₄, wherein the composition does not produce any clinically significant electrolyte shifts and does not include phosphate.

At issue was construction of the terms "purgation" and "from about 100 ml to about 500 ml." The former limitation was earlier construed in an unrelated litigation -- Braintree Laboratories, Inc. v. Novel Laboratories, Inc. -- where the Federal Circuit held that the term means "an evacuation of a copious amount of stool from the bowels after oral administration of the solution." This is relevant here because under this construction the two claim terms at issue are not contradictory (insofar as complete purging of the bowels is not achieved by ingesting only one bottle of the formulation, and both bottles together have a greater volume (946 mL) than the volumetric limitation permits).

Here, ANDA defendant Breckenridge stipulated that the construction of "purgation" in the Novel case would apply in this case (representing acquiescence to the reality that the Federal Circuit's construction in the Novel appeal would apply in any case). But Breckenridge's stipulation went further, wherein defendant agreed to be bound by any parts of the Novel opinion bearing on invalidity or non-infringement. As it turned out, the Novel decision did not address the volumetric limitations, and the District Court granted summary judgment that Breckenridge did not directly infringe nor induce infringement of the claims of the '149 patent, on two grounds. The first was that the term "from about 100 ml to about 500 ml" meant the entire volume ingested, which was incontestably greater (946 mL) than the recited 500 mL limit. Second, the District Court held that Breckenridge's label could not induce infringement under 35 U.S.C. § 271(e) because anything less than "full" colonic purging was not an approved use of the formulation. Braintree appealed.

The Federal Circuit reversed and remanded, in an opinion by Judge Moore, joined by Judges Newman and Wallach. The opinion rejects Breckenridge's view that the Novel opinion was not preclusive with regard to the volumetric limitation. In the panel's view, "[t]he meaning of the term 'from about 100 ml to about 500 ml' was necessarily connected to our construction of 'purgation.'" Novel had "intertwined" the two claim limitations in its noninfringement arguments, and the panel read the Court's earlier opinion to hold that "cleansing" (i.e., complete purgation), while recited as a goal expressly disclosed in the specification was not a claim limitation. The panel also read the Novel opinion to mean that "from about 100mL to about 500mL" was sufficient to induce purgation under the claims of the '149 patent. Citing the Novel opinion, this panel reminds the parties that:

Each of those half-dose sixteen ounce solutions has a total volume of 473 mL, which is within the range found in the asserted claims of the '149 patent, but Braintree concedes that neither dose accomplishes a full cleansing. Thus, Braintree's "one bottle" infringement theory asserts that one (half-dose) bottle of SUPREP, diluted with water to become a sixteen ounce solution, falls within the asserted claims. This infringement theory can prevail if purgation means the "evacuation of a copious amount of stool from the bowels after oral administration of the solution," which is something less than a full cleansing.

The Court also asserts that it is cognizant of the due process requirements, recited in Blonder-Tongue Labs., Inc. v. Univ. of Ill. Found., 402 U.S. 313, 329 (1971), that a party not be estopped by a claim construction decision where it is neither a party nor in privity with one. But Breckenridge stipulated that it would be bound by the Court's earlier decision. This stipulation foreclosed the District Court from construing the "from about 100mL to about 500mL" limitation otherwise.

With regard to the § 271(e) argument, the opinion also disagrees with the District Court's distinction between "purgation" and full colonic cleaning, based on the lower court's reading of the Novel decision. The panel says this case is unlike its earlier decisions, holding that an ANDA defendant's label could not induce infringement, based on the factual differences between those cases and this one. (The panel cited Warner-Lambert Co v. Apotex Corp., 316 F.3d 1348 (Fed. Cir. 2003); Allergan, Inc. v. Alcon Labs., Inc., 324 F.3d 1322 (Fed. Cir. 2003); and Bayer Schering Pharma AG v. Lupin, Ltd., 676 F.3d 1316, 1321 (Fed. Cir. 2012) in this regard.) In contrast with those cases, the Court states that "inducing purgation" is not a distinct use of the claimed formulation, because inducing purgation is just a means for achieving the desired result (inducing purgation of the colon of a patient) recited in the preamble of the '149 patent claims. And Breckenridge conceded that this is what its formulation was intended to do. Accordingly, the Court held that Breckenridge's generic formulation "recommends or suggests to physicians that the drug is safe and effective for administration to patients for the purposes of inducing [purgation]." This being the only FDA-approved use for Braintree's SUPREP, the Court held that a physician would understand that the generic label is also "safe and effective" for this use. Indeed, "[t]o hold otherwise would lead to the absurd result that a physician would understand Breckenridge's proposed product to be safe and effective for fully cleansing the colon, but not safe and effective at accomplishing a partial colon cleansing" according to the Court.

Due to Breckenridge's stipulations, that its proposed generic product would infringe the asserted claims of the '149 patent absent summary judgment, and that it would not raise defenses or counterclaims other than its noninfringement defense, the Court reversed and remanded with instructions that the District Court enter judgment in favor of Braintree. And the Court awarded Braintree its costs.

Braintree Laboratories, Inc. v. Breckenridge Pharmaceutical, Inc. (Fed. Cir. 2017)
Nonprecedential disposition
Panel: Circuit Judges Newman, Moore, and Wallach
Opinion by Circuit Judge Moore

Posted at 10:27 PM in Claim Construction, Federal Circuit, Patent Litigation | Permalink | Comments (0)

April 09, 2017

The Medicines Company v. Mylan, Inc. (Fed. Cir. 2017)

By Kevin E. Noonan --

The Federal Circuit returned to its consideration of the outcome in the District Court of The Medicines Company's ANDA litigation against Mylan and Bioniche Pharma over a proposed generic version of Medicines' bivalirudin drug (sold as Angiomax®), an anticoagulant used in heart surgery. In doing so, the Court focused on claim construction, basing its decision to reverse a finding of infringement under 35 U.S.C. § 271(e)(2) on differences with the District Court's claim construction.

The invention claimed in the patents-in-suit, U.S. Patent Nos. 7,582,727 and 7,598,343, can be appreciated by the following representative claims:

Claim 1 of the '727 patent:

1. Pharmaceutical batches of a drug product comprising bivalirudin (SEQ ID NO: 1: [Phe Pro Arg Pro Gly Gly Gly Gly Asn Gly Asp Phe Glu Glu Ile Pro Glu Glu Tyr Leu]) and a pharmaceutically acceptable carrier for use as an anticoagulant in a subject in need thereof, wherein the batches have a pH adjusted by a base, said pH is about 5-6 when reconstituted in an aqueous solution for injection, and wherein the batches have a maximum impurity level of Asp9-bivalirudin that does not exceed about 0.6% as measured by HPLC.

Claim 1 of the '343 patent:

1. Pharmaceutical batches of a drug product comprising bivalirudin ... prepared by a compounding process comprising:
    (i) dissolving bivalirudin in a solvent to form a first solution;
    (ii) efficiently mixing a pH-adjusting solution with the first solution to form a second solution, wherein the pH-adjusting solution comprises a pH-adjusting solution solvent; and
    (iii) removing the solvent and pH-adjusting solution solvent from the second solution;
    wherein the batches have a pH adjusted by a base, said pH is about 5-6 when reconstituted in an aqueous solution for injection, and wherein the batches have a maximum impurity level of Asp9-bivalirudin that does not exceed about 0.6% as measured by HPLC.

The patents-in-suit arose from Medicines' solution to production problems with the drug, which led to the production of a degradation product, Asp9 bivalirudin (caused by deamination of Asn9); in high enough concentrations (>1.5%) Asp9 bivalirudin contaminants were unacceptable (per FDA). Production of bivalirudin batches contaminated with high levels of Asp9 bivalirudin caused Medicines to shut down commercial production for more than a year. The company's attempts to produce formulations of the drug for commercial sale were unsuccessful, and led Medicines to develop certain ways of adjusting the pH that reduced the impurity levels to less than 0.6% and resulted in the '343 and '727 patents.

These patents were the subject of litigation between Medicines and Hospira, where coincidentally the same panel that rendered the instant decision determined that the claims were invalid under the on-sale bar of 35 U.S.C. § 102(b)(among other grounds) (see "The Medicines Company v. Hospira (Fed. Cir. 2015)"). The Federal Circuit thereafter vacated the panel opinion and reinstituted the appeal en banc, ordering the parties (and amici) to brief issues relating to the on-sale bar and its application to the relationship between Medicines and its contract manufacturer. The en banc court reversed the decision by the merits panel that the on-sale bar applied, in a unanimous court by Judge O'Malley (see "The Medicines Company v. Hospira, Inc. (Fed. Cir. 2016) (en banc)").

The Federal Circuit (which had dismissed Medicines' and Mylan's cross-appeals in view of the merit panel's decision in the Hospira case) then reinstated this appeal between Medicines and Mylan. The District Court had granted summary judgment of non-infringement to Mylan as to the claims of the '343 patent, based on Mylan's ANDA specifying methods for formulating that did not use the claimed "efficient mixing" limitation of that patent's claims. After a bench trial, the District Court had granted judgment in Medicines' favor, expressly because the '727 patent claims did not recite the "efficient mixing" limitation.

The Federal Circuit affirmed the District Court's summary judgment decision regarding the '343 patent claims, but reversed the judgment regarding the '727 patent claims, in an opinion by Judge Dyk joined by Judges Hughes and Wallach. The Court expressly based its decision on construction of the term "batches" in the '727 patent claims, which required the use of efficient mixing methods as disclosed in the specification shared in common by both patents. This specification defined "batches" as:

As used here, "batch" or "pharmaceutical batch" refers to material produced by a single execution of a compounding process of various embodiments of the present invention. "Batches" or "pharmaceutical batches" as defined herein may include a single batch, wherein the single batch is representative of all commercial batches (see generally, Manual of Policies and Procedures, Center for Drug Evaluation and Research, MAPP 5225.1, Guidance on the Packaging of Test Batches at 1), and wherein the levels of, for example, Asp9-bivalirudin, total impurities, and largest unknown impurity, and the reconstitution time represent levels for all potential batches made by said process. "Batches" may also include all batches prepared by a same compounding process.

The District Court construed the term "pharmaceutical batches" consistent with specification, to be either a single batch representative of all commercial batches "made by a compounding process" having consistent levels of all impurities (including Asp9-bivalirudin) or all batches made by the compounding process; the Federal Circuit opinion notes that the parties consented to this construction. With regard to the term "efficient mixing," the District Court based its construction on two examples in the common specification: one the "inefficient" mixing according to earlier Medicines' processes (Example 4), and the efficient process disclosed in the specifications (Example 5); the District Court further held that Medicines had disclaimed the old inefficient mixing process.

With regard to its review of claim construction, the opinion notes that claim construction here is reviewed as a matter of law because the District Court did not consider anything outside the intrinsic evidence, under the Supreme Court's Teva Pharmaceuticals v. Sandoz decision. The panel based its contrary decision on the District Court's failure to interpret the "batches" limitation to require efficient mixing for the claims of the '727 patent. The panel's rationale was that the "batches" limitation requires the claims to encompass only those having impurity levels less than 0.6%, and that this limitation cannot cover individual batches because it was undisputed that such batches were known in the prior art (i.e., batches Medicines made prior to the disruption that led to this invention). The opinion states: "[r]ather, properly construed, what the batches limitation requires is the use of a process that achieves batch consistency," expressly construing the "batches" claim limitation in view of the specification. "The batches limitation therefore requires a process that achieves consistency between batches produced from the 'same compounding process'—i.e., batch consistency," said the Court. Indeed, the panel viewed this consistency as being what distinguished these claims from the prior art (including Medicines' own prior methods and batches). Without tying the interpretation of the term "batches" to the disclosed more efficient methods, the opinion asserts that there would be no way of effectively deciding when and whether infringement would lie. The opinion foresees a need for "forward-looking assessments of whether future batches would infringe" (i.e., only after the batches were tested to determine the level of Asp9-bivalirudin levels). According to the opinion:

To illustrate, if a defendant using the same compounding process produced fifty batches each having an Asp9 level below 0.6 percent, each of those fifty batches would infringe. But the defendant would not know whether any of the batches infringed until all fifty batches had been produced because if even one of those batches was determined to have an Asp9 level higher than 0.6 percent, none of the batches would infringe.

In this regard, the opinion posits that such an interpretation would not provide the "reasonable certainty" required by Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120, 2129 (2014).

The opinion further found support for the Court's interpretation in the specification and prosecution history (particularly with regard to the claims patentability over inter alia the Medicines' own prior art).

Having determined that proper construction of the "batch" limitation required the use of a compounding process that achieves batch consistency, the opinion then turned to whether this compounding process must entail "efficient mixing." Evidence for this requirement the Court found in the specification, particularly disclosure that "pH-adjusting solution will be efficiently mixed," and that "[e]fficient mixing of the pH-adjusting solution . . . will minimize levels of Asp9-bivalirudin." Moreover, the Court states that the specification disclosed no other method capable of producing such batches with the necessary consistency (relating to the comparison between the methods disclosed in Examples 4 and 5). The opinion also asserted that the District Court's determination that Medicines disclaimed inefficient mixing was not inconsistent with its determination that what the claims required was efficient mixing.

The opinion also rejected Medicines' contention that this interpretation would make the claims of the '343 patent "superfluous" (more accurately, implicate double patenting) by noting there may be overlap between certain of the claims but that the more specific recitations in the '343 claims distinguished them from the '727 claims. The opinion also asserted that adopting Medicines' construction would potentially encompass the prior art, and thus impermissibly extending Medicines' "monopoly" beyond the invention disclosed in the common specification.

The Court then turned to what is meant by "efficient mixing." This term is explicitly defined in the common specification to mean "'mixing [that] is characterized by minimizing levels of Asp9-bivalirudin in the compounding solution,' i.e., below 0.6 percent Asp9-bivalirudin in the intermediate solution." The panel rejected this interpretation, insofar as "it does not accord with the linguistic formula used by the patentee to signal the designation of other defined terms—including 'batches.'" By this it appears the Court meant to distinguish between how this statement was phrased and how other terms were expressly defined, i.e., where "the defined term [is] in quotation marks, followed by the terms 'refers to' or 'as defined herein.'" The Court also rejected Medicines' assertion that its phrase was definitional on the basis that is was "a mere recitation of the results obtained" rather than constituting a definition of what "efficient mixing" is, according to the opinion. Using Medicines' definition "would expand the scope of 'efficient mixing' to cover any way of mixing that achieves a compounding solution having an Asp9 level of less than 0.6 percent" in violation of the written description requirement, said the panel, citing Ariad Pharms., Inc. v. Eli Lilly & Co., 598 F.3d 1336, 1352–53 (Fed. Cir. 2010) (en banc). The Court found no art-recognized definition of the term "efficient mixing," and the other portions of the specification Medicines' argued disclosed alternative methods were "vague and unhelpful" (and were not relied upon by the District Court or the parties). Finally, the opinion (relying with some irony on Medicines' criticism of the District Court for defining "efficient mixing" with regard to what it is not, i.e., prior art methods) notes that the skilled artisan would rely upon the methods recited in Example 5 to understand what efficient mixing is. In the Court's opinion, this Example is the only description of efficient mixing in the specification and not just an embodiment. According to the panel, this Example provides "a clear 'objective standard by which to measure the scope of the term.'"

The opinion concluded that, in order to infringe a batch must be compounded using a efficient mixing process according to Example 5 for claims of either the '727 and '343 patents.

There is some logic underlying this decision, but it can be understood if Medicines' views the Federal Circuit's logic as imposing a definition from the specification onto the claims, contrary to the claim construction rubric that limitations should not be incorporated from the specification into the claims. This aspect of the decision brings to mind District Court Judge Vaughn Walker's discussion of how vexatious this rule can be, as set forth his dissent in Medegen MMS, Inc. v. ICU Medical, Inc. (Fed. Cir. 2008):

The issues before the Court presented "a conundrum often faced by district courts when construing" claim terms, citing the "twin axioms" of claim construction that produced the conundrum: "[o]n the one hand, claims 'must be read in view of the specification'," citing Markman, while "[o]n the other hand, it is improper to read a limitation from the specification into the claims," citing Arlington Indus. Inc. v. Bridgeport Fittings, Inc. The problem with these axioms, according to Judge Walker, is that "the axioms themselves seldom provide an answer, but instead merely frame the question to be resolved."

"As a jurist more accustomed to working on the front lines of patent litigation than reviewing decisions from above, it is my experience that claim construction -- determining how one of ordinary skill in the art would understand the patent at the time of invention -- often requires making fact-like determinations not well suited to appellate review."

The Supreme Court's decision in Teva v. Sandoz reversed the Federal Circuit's practice of giving no deference to factual underpinnings of claim construction as set forth in Cybor Corp. v. FAS Technologies, Inc. The instant decision shows that while the problems attendant upon failure to give factual deference have been diminished they have not been overcome entirely.

The Medicines Company v. Mylan, Inc. (Fed. Cir. 2017)
Panel: Circuit Judges Dyk, Wallach, and Hughes
Opinion by Circuit Judge Dyk

Posted at 11:59 PM in Claim Construction, Federal Circuit | Permalink | Comments (0)

March 06, 2017

Los Angeles Biomedical Research Institute v. Eli Lilly & Co. (Fed. Cir. 2017); Eli Lilly & Co. v. Los Angeles Biomedical Research Institute (Fed. Cir. 2017)

By Kevin E. Noonan --

The Federal Circuit handed down two related opinions last week, Los Angeles Biomedical Research Institute v. Eli Lilly & Co. and Eli Lilly & Co. v. Los Angeles Biomedical Research Institute, one of which raised the question of whether (and when) it is appropriate for the Court to remand decisions of the Patent Trial and Review Board (PTAB) rendered under the post-grant provisions of the Leahy-Smith America Invents Act (AIA).

The case arose as an inter partes review (IPR) before the PTAB, wherein the Board held all claims of U.S. Patent No. 8,133,903 to be obvious. The claims were directed to methods for treating ("arresting or regressing") penile fibrosis. This condition has two forms: penile tunical fibrosis, where excess collagen builds up in the tunica albuginea (a membrane surrounding the corpora cavernosa, the chambers that fill with blood during an erection), and corporal tunica fibrosis, where excess collagen builds up in the corpora cavernosa itself. The claimed treatment is daily administration of type 5 phosphodiesterase (PDE5) inhibitors, said treatment being characterized as "long term" in the opinion. The class of PDE5 inhibitors includes drugs like sildenafil (Viagra^®) and tadalafil (Cialis^®), well-known erectile dysfunction treatments; while penile fibrosis can cause erectile dysfunction, the disease is distinct from other causes of ED.

Claim 1 of the '903 patent is representative:

1. A method comprising:
a) administering acyclicguanosine3',5'-monophosphate (cGMP) type 5 phosphodiesterase (PDE5) inhibitor according to a continuous long-term regimen to an individual with at least one of a penile tunical fibrosis and corporal tissue fibrosis; and
b) arresting or regressing the at least one of the penile tunical fibrosis and corporal tissue fibrosis, wherein the PDE- 5 inhibitor is administered at a dosage up to 1.5 mg/kg/day for not less than 45 days.

Eli Lilly petitioned for an IPR after the Los Angeles Biomedical Research Institute (LAB) sued for infringement over the company's marketing of Cialis^® for the treatment of penile fibrosis. The Board instituted an IPR on two grounds: anticipation (reviewed on appeal in a separate decision captioned Eli Lilly & Co. v. Los Angeles Biomedical Research Institute) and obviousness as reviewed in this opinion. The Board found the claims obvious based on teaching that PDE5 inhibitors can be used for treating ED (which the Board construed as including penile tunical fibrosis and corporal tissue fibrosis); that ED is a disease associated with aging and, inter alia, atherosclerosis (associated in turn according to the Board with corporal fibrosis), and that long term treatment (at least 45 days) with up to 1.5 mg/kg/day (~100 mg for an average-sized adult male) was effective for treating ED caused by "diabetes, atherosclerosis, smoking, hypertension, or a combination of such factors." The Board rejected LAB's contention that treatment with PDE5 was thought in the art to exacerbate rather than ameliorate penile fibrosis.

The Federal Circuit vacated and remanded, in an opinion by Judge Bryson joined by Judge Moore; Judge Newman concurred in part but dissented from the judgment. The Court first rejected LAB's claim of priority, based on failure to disclose dosages of up to 1.5 mg/kg/day in its the earliest-filed provisional application. This portion of the opinion considers whether disclosure regarding administration of PDE5 inhibitors to rats at a specific concentration (100 mg/L) would have been understood by a person having ordinary skill in the art to be equivalent to 1.5 mg/kg/day for an adult human male and the Court's opinion that it would not. Indeed, any such "knowledge" by a skilled person would have been based on speculation, which cannot satisfy the written description requirement according to the panel, citing Lockwood v. Am. Airlines, Inc., 107 F.3d 1565, 1572 (Fed. Cir. 1997) .

The panel then addressed the Board's claim construction, finding that the Board had "read out of the claim" the limitation of "an individual with at least one of penile tunical fibrosis and corporal tissue fibrosis" by interpreting that phrase to mean "an individual hav[ing] symptoms that may be associated with penile fibrosis, such as [erectile dysfunction], but not that the patient be specifically diagnosed as having penile tunical fibrosis or corporal tissue fibrosis." According to the opinion, the patent specification makes clear that "penile fibrosis may result in erectile dysfunction, but it may not" and "erectile dysfunction has alternative causes and may present without underlying penile fibrosis." The patent claims are directed to methods for treating penile fibrosis whether or not it results in the symptoms of erectile dysfunction, and thus the Board wrongly construed this term according to the opinion. The panel found support for its view on the correct claim construction of this term from the Court's decision in Rapoport v. Dement, 254 F.3d 1053 (Fed. Cir. 2001), where, analogously, claims for treating sleep apnea were not directed to treating the symptoms of sleep apnea. Accordingly, the Federal Circuit found that the Board had not adopted the broadest reasonable interpretation of the claims but rather an overbroad interpretation.

Similarly, the opinion rejected the Board's determination that the limitation "arresting or regressing the at least one of the penile tunical fibrosis and corporal tissue fibrosis" is entitled to no patentable weight, as being merely a statement of intended results of PDE5 inhibitor administration according to the claims. The opinion based this conclusion on the placement of the limitation in the structure of the claim, not as part of a preamble but as an affirmatively recited element. In addition, the Court found "[o]ther intrinsic evidence" (and thus appropriately subjected to de novo review) that distinguishes the phrase as it is used in these claims from situations where such limitations are present in preambles or "wherein" clauses; this conclusion is supported by examples of efficacy set forth in the specification.

The Court concluded its review of the Board's claim construction by rejecting LAB's contention that the claim term "continuous long-term regimen" adds an additional limitation regarding steady state plasma concentration or constant dosing level in vivo, because the argument was not supported by the intrinsic evidence from the specification or prosecution history or extrinsic evidence from expert testimony.

Turning to the Board's conclusion that the claims were obvious, the panel vacated the judgment based on its conclusions regarding the Board's improper claim construction. Specifically, while the Board found that it would have been obvious to combine the teachings of three prior art references to arrive at a method for treating ED, "[w]hat the Board did not do [] was to find that those references taught treating a patient with penile tunical fibrosis or corporal tissue fibrosis" nor that the references would have provided the skilled worker with a reasonable expectation of success for treating these conditions. The panel also found wanting reliance on references that taught "on-demand" dosing to support obviousness of claims that recited "long-term daily treatment" with PDE5 inhibitors.

The Board also erred in rejecting LAB's evidence that the prior art taught that long-term treatment with PDE5 inhibitors was thought to be detrimental because it would increase fibrosis by stimulating nitric oxide production as understood in the art.

Accordingly, the panel's ruling was that:

The question remains whether a person of skill in the art would have had a reason to combine [the three cited references] to treat penile fibrosis with a long-term regimen of a daily dosage of a PDE5 inhibitor, and would have had a reasonable expectation of success from doing so. Because the Board's obviousness analysis was based on an erroneous construction of the claim language and an overly broad interpretation of [one of the references], and because the Board did not address the record evidence summarized above, we remand for the Board to make new findings as to whether there was an apparent reason to combine the prior art references and whether that combination would have rendered obvious the long-term administration of PDE5 inhibitors to treat penile fibrosis.

The opinion also mandates that on remand the Board "make the findings necessary to determine whether the references render the 'arresting or regressing' limitation obvious, but affirmed the Board's finding that the dosage limitation ("up to 1.5 mg/kg/day for not less than 45 days") is disclosed in the prior art.

Judge Newman dissented because she believed the Board had established obviousness. In addition, however, she voiced her belief that remand was inappropriate and contrary to the IPR provisions of the AIA. In her view:

The America Invents Act was enacted to remedy the lack of expedition and to add predictability in infringement disputes, by assigning to an expert administrative tribunal and presumed expert federal court the resolution of some major patentability issues, with tight procedural rules and deadlines. It was expected that in the normal course questions of patentability under Section 102 and 103 would be reliably and speedily resolved. Implementing this policy, when we find analytic lapses by the PTAB, it appears that the statute contemplates that we will make the determination, on the record that was made at the Board. Indeed, the depth of briefing by the parties suggests that this was their understanding, too.

Remands are contrary to this understanding of the intent of Congress in enacting the IPR provisions of the AIA, and thus while Judge Newman does not believe remands are never appropriate, they should be rare.

In the companion case, the Federal Circuit affirmed the Board's determination that the asserted reference (International Publication No. WO 01/80860) did not anticipate the claims, because it did not disclose the limitation that PDE5 inhibitors be administered "at a dosage up to 1.5 mg/kg/day for not less than 45 days." While conceding that the reference might "suggest" long-term dosing, the panel held that such suggestion is not enough to satisfy the anticipation standard, citing AstraZeneca LP v. Apotex, Inc., 633 F.3d 1042, 1055 (Fed. Cir. 2010), in support of its interpretation.

Los Angeles Biomedical Research Institute v. Eli Lilly & Co. (Fed. Cir. 2017)
Panel: Circuit Judges Newman, Bryson, and Moore
Opinion by Circuit Bryson; opinion concurring in part, dissenting from the judgment by Circuit Judge Newman

Eli Lilly & Co. v. Los Angeles Biomedical Research Institute (Fed. Cir. 2017)
Panel: Circuit Judges Newman, Bryson, and Moore
Opinion by Circuit Judge Newman

Posted at 11:59 PM in Claim Construction, Federal Circuit, Novelty, Obviousness, Patent Trial and Appeal Board | Permalink | Comments (0)

February 14, 2017

Shire Development LLC v. Watson Pharmaceuticals Inc. (Fed. Cir. 2017)

By Kevin E. Noonan --

The Federal Circuit, in its third opinion involving ANDA litigation between these parties over Shire's LIALDA^® (mesalamine) product, has apparently brought this case to a close in generic drug maker Watson's favor, in a decision handed down last Friday.

The lawsuit involved Watson's ANDA filing seeking approval for a generic version of Shire's controlled-release oral pharmaceutical composition for the treatment of inflammatory bowel disease, Crohn's disease, and ulcerative colitis, sold by Shire under the brand name LIALDA®. Shire listed U.S. Patent No. 6,773,720 in the Orange Book having claims for its patented formulations of the active pharmaceutical ingredient mesalamine (5-amino salicylic acid). These formulations were characterized as having high concentrations (85-90% by weight) of the API. The formulations contain an "inner hydrophobic matrix" and an "outer hydrophilic matrix," as used in the following representative claims of the '720 patent:

1. Controlled-release oral pharmaceutical compositions containing as an active ingredient 5- amino-salicylic acid, comprising:
    a) an inner lipophilic matrix consisting of sub- stances selected from the group consisting of unsaturated and/or hydrogenated fatty acid, salts, esters or amides thereof, fatty acid mono-, di- or triglycerid[e]s, waxes, ceramides, and cholesterol derivatives with melting points below 90° C., and wherein the active ingredient is dispersed both in said the lipophilic matrix and in the hydrophilic matrix;
    b) an outer hydrophilic matrix wherein the lipophilic matrix is dispersed, and said outer hydrophilic matrix consists of compounds selected from the group consisting of polymers or copolymers of acrylic or methacrylic acid, alkylvinyl polymers, hydroxyalkyl celluloses, carboxyalkyl celluloses, polysaccharides, dextrins, pectins, starches and derivatives, alginic acid, and natural or synthetic gums;
    c) optionally other excipients;
    wherein the active ingredient is present in an amount of 80 to 95% by weight of the total composition, and wherein the active ingredient is dispersed both in the lipophilic matrix and in the hydrophilic matrix.

The claimed formulations provide the "sustained and uniform manner" by which the mesalamine API is released as the drug passes through the gut.

In the first trial on the merits, the District Court construed the term "inner hydrophobic matrix" to mean "a matrix including at least one lipophilic excipient, where the matrix is located within one or more substances," and construed "outer hydrophilic matrix" to mean "a matrix of at least one hydrophilic excipient, where the matrix is located outside the inner lipophilic matrix."

On appeal the Federal Circuit reversed, holding that these constructions did not comport with the "ordinary and customary" meanings of the claim terms because they were "impermissibly broad." Specifically, that panel held that the District Court had properly construed the term "matrix" in each instance as "a macroscopically homogeneous structure in all its volume," but disagreed with how the court construed "lipophilic matrix" to mean "a matrix that includes at least one lipophilic excipient." This error arose because the District Court's construction "focuse[d] on the lipophilic properties of an excipient in the matrix, rather than the properties of the matrix itself." That panel believed that the intrinsic evidence mandated a construction wherein lipophilicity (or, for that matter the hydrophilicity) is a characteristic of the matrix, not the excipient in the matrix, according to distinctions found in the specification.

Shire petitioned for certiorari and the Supreme Court vacated this decision and remanded to the Federal Circuit for reconsideration in view of the Court's intervening decision in Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc. In that case, the Court set forth the standard of Federal Circuit review of district courts' claim construction, changing the completely de novo standard of Fas v. Cybor to one wherein questions of law are to be reviewed de novo but factual determinations of a district court should be reviewed for clear error, i.e., giving deference to the district court's factual findings pursuant to Federal Rule of Civil Procedure 52(a)(6). Notably, this change was not mandated for cases where a district court relied solely on the intrinsic evidence (plain meaning of the claim language, the specification and the prosecution file history). On remand, the Federal Circuit saw fit not to change its earlier determination that the District Court had erred (based on its determination that the District Court had relied only on intrinsic evidence) and remanded the matter to the District Court for trial according to that panel's claim construction.

This appeal is the result of that trial, wherein the District Court again found infringement under 35 U.S.C. § 271(e)(2). And once again the Federal Circuit reversed, in an opinion by Judge Hughes, joined by Chief Judge Prost and Judge Taranto. In this opinion, the panel focused on the Markush groups recited in the claims ("selected from the group consisting of"; see Ex parte Markush, 1925 C.D. 126 (Comm'r Pat. 1925) and MPEP 803.02), which format the opinion noted was relevant to the opinion because, in its earlier claim construction they formed the basis for the Court's determination that "'the correct construction requires that the inner volume contain substances from the group described for the inner lipophilic matrix (which are all lipophilic substances), and that the outer volume separately contain substances from the group described for the outer hydrophilic matrix (which are all hydrophilic).'" The District Court here found that the presence of components of the lipophilic and hydrophilic matrices comprising Watson's formulation falling outside the scope of the Markush groups did not bar infringement because these components were "'unrelated' to the invention because they did not drive the water-affinity property of their respective matrices." In some instances, permitting unrelated components to be present in an invention claimed using Markush group language is permissible, according to the opinion, provided that these are related to "aspects unrelated to the invention," citing Norian Corp. v. Stryker Corp., 363 F.3d 1321, 1331 (Fed Cir. 2004). Here, however, Watson's formulation "does not facially satisfy the claim 1(b) Markush limitation," according to the opinion, because the extragranular space comprising the outer hydrophilic matrix contains lipophilic magnesium stearate, a component not recited in the claim 1(b) Markush group.

Specifically, the Federal Circuit rejected the District Court's distinction that "magnesium stearate in the extragranular space is overwhelmed by the hydrophilic properties of the sodium starch glycolate in the extragranular space" based in part on expert testimony that the hydrophilic "'sodium starch glycolate is more potent than the mag[nesium] stearate" when "outside" the granules.'" Indeed, the District Court found (and the Federal Circuit agreed) that magnesium stearate "retained its lipophilic character in the extragranular space" to the same extent that it exerted a lipophilic effect in granules. On that basis, the panel held that the compound "structurally and functionally" is related to the invention as claimed and thus violates the Markush group of claim 1(b), which does not recite magnesium stearate as a member thereof. In doing so, the panel rejected Shire's contention (adopted by the District Court) that magnesium stearate in Watson's formulation was used as a lubricant and not for its lipophilic properties and was not lipophilic enough to render the outer matrix lipophilic. According to the opinion, Norian did not impose a requirement that related components were only those that "advance or are intended to advance" the inventive elements recited in a Markush group, on the grounds that such a requirement would be equivalent to construing "consisting of" in the Markush language to have a scope of "comprising" or "consisting essentially of" (the latter phrasing being most closely related to the scope that Shire advanced in its claim construction arguments).

The Court remanded with directions to enter judgment of non-infringement, thus putting Watson in the position to be able to market its generic mesalamine formulation (the Hatch-Waxman 30-month stay having expired long ago). Shire may still appeal, either by requesting rehearing en banc or filing another certiorari petition. Insofar as the Federal Circuit's opinion is based on the District Court's factual findings (supported by expert testimony) cert. is not a foregone conclusion. It will depend on whether Shire can convince the Justices that the Federal Circuit has not minded the High Court's lessons regarding claim construction. Perhaps needing to delve into the minutiae of Markush claiming will be enough to deter the Court from revisiting this aspect of claim construction so soon after its Teva decision (similar to the Court refusing to grant cert. in the Sequenom case after its recent spate of diagnostic method claim cases). But this case provides a reminder of the tortured path litigants may need to take to get what presumably is a final outcome, and the uncertainty that persists until entry of a final judgment from which there is no further appeal.

Shire Development LLC v. Watson Pharmaceuticals Inc. (Fed. Cir. 2017)
Panel: Chief Judge Prost and Circuit Judges Taranto and Hughes
Opinion by Circuit Judge Hughes

Posted at 11:13 PM in Claim Construction, Federal Circuit | Permalink | Comments (1)

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