Patent Docs

Boehringer Ingelheim Pharmaceuticals Inc. v. Mylan Pharmaceuticals Inc. (Fed. Cir. 2020)

By Donald Zuhn –-

Last month, in Boehringer Ingelheim Pharmaceuticals Inc. v. Mylan Pharmaceuticals Inc., the Federal Circuit reversed a decision by the U.S. District Court for the District of New Jersey finding certain claims of U.S. Patent No. 8,853,156 to be directed to ineligible subject matter under 35 U.S.C. § 101, and remanded for further proceedings.  The Federal Circuit also affirmed the District Court's finding that the asserted claims of U.S. Patent Nos. 9,173,859 and 8,673,927 were invalid for obviousness and obviousness-type double patenting.

Plaintiffs-Appellants Boehringer Ingelheim Pharmaceuticals, Inc.; Boehringer Ingelheim International GmbH; Boehringer Ingelheim Corp.; and Boehringer Ingelheim Pharma GmgH & Co. KG ("Boehringer") filed suit against Defendants-Appellees Mylan Pharmaceuticals Inc.; Mylan Inc.; Mylan Laboratories, Ltd.; Aurobindo Pharma Ltd.; and Aurobindo Pharma USA, Inc. ("Mylan") for infringement of the '156, '859, and '927 patents.  The asserted patents relate to the treatment of type 2 diabetes mellitus with DPP-IV inhibitors such as linagliptin.  Mylan moved for partial summary judgment on the pleadings, alleging that claims 10-17, 24, and 25 of the '156 patent are directed to ineligible subject matter under 35 U.S.C. § 101.  The District Court granted Mylan's motion, finding that claims 10-17, 24, and 25 of the '156 patent are directed to the "abstract idea" of "administering the DPP-IV inhibitor to the targeted patient population," and that these claims fail to recite an inventive concept.

At trial, the District Court determined that claims 1, 14, 15, 20, and 21 of the '859 patent and claims 7, 9, 15, 17, 19, 25, and 26 of the '927 patent are invalid for obviousness-type double patenting in view of the claims of U.S. Patent No. 8,178,541, and invalid as obvious in view of U.S. Patent Application Publication No. 2004/0097510.  In particular, the District Court determined that because the claimed invention's doses of linagliptin in 2.5 mg and 5 mg fall within the '510 publication's disclosed range of 1–100 mg, there is a presumption of obviousness.  The District Court alternatively found that a person of ordinary skill in the art would have obtained the claimed dosages through routine experimentation.

In an opinion by Judge Moore, joined by Judges Dyk and Hughes, the Federal Circuit concluded that claims 10–17, 24 and 25 of the '156 patent are directed to patent eligible subject matter.  The opinion notes that the '156 patent relates to the treatment and/or prevention of metabolic diseases such as type 2 diabetes mellitus with DPP-IV inhibitors such as linagliptin in patients for whom normal metformin therapy is not appropriate, setting forth claims 1 and 10 of the '156 patent:

1.  A method of treating and/or preventing metabolic diseases in a patient for whom metformin therapy is inappropriate due to at least one contraindication against metformin comprising orally ad-ministering to the patient a DPP-IV inhibitor wherein the contraindication is selected from the group consisting of: renal disease, renal impairment or renal dysfunction, unstable or acute congestive heart failure, acute or chronic metabolic acidosis, and hereditary galactose intolerance.

10.  The method according to claim 1 wherein the metabolic disorder is type 2 diabetes mellitus and wherein the contraindication is renal disease, renal impairment or renal dysfunction, and wherein said DPP-4 inhibitor is used for said patient in the same dose as for a patient with normal renal function.

On appeal, Boehringer argued, echoing language from Vanda Pharmaceuticals Inc. v. West-Ward Pharmaceuticals International Ltd., 887 F.3d 1117 (Fed. Cir. 2018), that the claims are directed to a "method of treating a specific disease ([type 2 diabetes mellitus]) for specific patients (with renal impairment) using a specific compound (linagliptin) at specific doses (same dose in patients with renal impairment as in patients with normal renal function) to achieve a specific outcome."  Mylan argued that the claims are directed to the natural law that "certain DPP-IV inhibitors (including linagliptin) are metabolized by the liver rather than the kidney."

In finding claims 10–17, 24 and 25 of the '156 patent  to be patent eligible, the Federal Circuit determined that "consistent with this court's decision in Vanda Pharmaceuticals Inc. v. West-Ward Pharmaceuticals International Ltd., 887 F.3d 1117 (Fed. Cir. 2018), the claims are directed to a particular method of treatment under step one and are therefore patent eligible."  The Court explained that even though "certain DPP-IV inhibitors (including linagliptin) are metabolized by the liver rather than the kidney," this "does not make the claim 'directed to' that natural ability."  The panel also noted that because the claims are directed to a method of treatment at step one, the Court could "conclude [that] the claims are patent eligible and need not reach step two" under the two-step framework of Alice Corporation Pty. Ltd. v. CLS Bank International, 573 U.S. 208 (2014).  The Federal Circuit therefore reversed the District Court's grant of judgment on the pleadings of patent ineligibility and remanded to the District Court for further proceedings.

Turning to the District Court's finding that claims 1, 14, 15, 20, and 21 of the '859 patent and claims 7, 9, 15, 17, 19, 25, and 26 of the '927 patent were invalid for obviousness-type double patenting and invalid as obvious in view of the prior art, the opinion notes that the claims at issue relate to the treatment of type 2 diabetes mellitus with linagliptin in 2.5 or 5 mg doses, setting forth claim 14 of the '859 patent:

14.  An oral tablet formulation comprising 1-[(4-me-thyl-quinazolin-2-yl)methyl]-3-methyl-7-(2-butyn-1-yl)-8-(3-(R)-amino-piperidin-1-yl)-xanthine in an amount of 2.5 mg or 5 mg optionally in combination with metformin, and a pharmaceutically acceptable carrier or diluent.

and claim 7, which depends from claim 1, of the '927 patent as illustrative:

1.  A method of treating type II diabetes mellitus comprising administering to a patient in need thereof a pharmaceutically effective oral amount of 1-[(4-methyl-quinazolin-2-yl)-methyl]-3-methyl-7-(2-butyn-1-yl)-8-(3-(R)-amino-piperidin-1-yl)-xanthine, and a pharmaceutically effective amount of metformin, which is from 300 mg to 1000 mg once or twice a day, or delayed-release metformin in a dose of 500 mg to 1000 mg once or twice a day or 500 mg to 2000 mg once a day.

7.  The method according to claim 1, wherein the 1-[(4-methyl-quinazolin-2-yl)methyl]-3-methyl-7-(2-butyn-1-yl)-8-(3-(R)-amino-piperidin-1-yl)-xanthine is administered in an oral dosage of 2.5 mg or 5 mg.

On appeal, Boehringer argued that the District Court's conclusions of invalidity for obviousness-type double patenting and obviousness depended on its determination that the claimed dosages would have been obvious.  In affirming the District Court's findings of invalidity for obviousness-type double patenting and obviousness, the Federal Circuit concluded that the District Court's alternative finding (i.e., that a person of ordinary skill in the art would have obtained the claimed dosages through routine experimentation) is not clearly erroneous.  The Court therefore did not need to decide whether the District Court's presumption determination of obvious was correct.  The Federal Circuit thus affirmed the District Court's decision finding the asserted claims of the '859 and '927 patents to be invalid for obviousness and obviousness-type double patenting.

Boehringer Ingelheim Pharmaceuticals Inc. v. Mylan Pharmaceuticals Inc. (Fed. Cir. 2020)
Nonprecedential disposition
Panel: Circuit Judges Dyk, Moore, and Hughes
Opinion by Circuit Judge Moore

Naples Roundtable Requests PTAB to Make Decisions Precedential

The Naples Roundtable, a 501(c)(3) non-profit organization whose primary mission is to explore ways to improve and strengthen the U.S. patent system, will on Monday, March 23rd file a Request with the U.S. Patent and Trademark Office, to designate Ex parte Olson (Appeal 2017-006489), and Ex parte Fautz (Appeal 2019-000106) as precedential.  Both were designated "informative" on July 21, 2019.  In each case, the Patent Trial and Appeal Board reversed an Examiner's decision rejecting the claims in each application as being directed to patent-ineligible subject matter under 35 U.S.C. § 101 under the Supreme Court's Mayo/Alice jurisprudence.  The basis for the Board's decision reversing the Examiner in each case was the 2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019) (hereinafter "Guidance").

The Olson claims were directed to a catheter navigation system involving mathematical equations used in the claimed system and methods that reduced registration errors in a 3D imaging system resulting in improved catheter placement in a patient.  The Board found error in the Examiner's application of Revised Step 2A, 2nd Prong, wherein the claims recited additional limitations that applied the results of the mathematical formulae to achieve the claimed result, i.e., reduce errors in catheter placement by accounting for patient-specific non-linearities and inhomogeneities in catheter navigation, again finding similarities to how the Arrhenius equation was used in Diamond v. Diehr.

The Fautz claims were directed to magnetic resonance tomography (MRT) and methods for performing MRT using the apparatus and recited three mathematical formulae and four calculations that use those formulae.  As in Olson, the Board held that the Examiner improperly applied Revised Step 2A, 2nd Prong.

And in each case, the rationale for the Board's decision avoided having to consider Revised Step 2B, regarding whether the claim recited that ineluctable "something more" recited in the Revised Guidance.

The letter is signed by Gary Griswold, Naples Roundtable President; Kevin E. Noonan, Patent Docs author and MBHB Partner: Andrew Baluch, Naples Roundtable Amicus Committee Chair; and Teresa Summers, Naples Roundtable Treasurer.

Mallinckrodt Files Certiorari Petition in iNO v. Praxair

By Kevin E. Noonan --

Mallinckrodt filed a certiorari petition with the Supreme Court last week, over the Federal Circuit panel decision (by Chief Judge Prost joined by Judge Dyk; Judge Newman dissented on the issue before the Court in this petition) affirming dismissal of a suit by Mallinckrodt's subsidiary, iNO Pharmaceuticals, in iNO Therapeutics LLC v. Praxair Distribution Inc.  From the first sentence, the petition frames the issue as one of lower court confusion with the Supreme Court's subject matter eligibility jurisprudence:

In the years since this Court's decision in Mayo Collaborative Services LLC v. Prometheus Laboratories, Inc., 566 U.S. 66 (2012), the lower courts have struggled to apply the judicially-created exceptions to the subject matter that Congress declared eligible for patent protection in 35 U.S.C. § 101.

In addition to painting the Federal Circuit with a brush both familiar to and consistent with the Court's view on its appellate junior, the petition makes the characterization that "[t]here is no more pressing issue in patent law than resolving the uncertainty that has surrounded the judicial exceptions to §101."  To be honest, however, following these exhortations with a reiteration of the situation at the Federal Circuit, including the almost cri de coeur nature of the concurrences and dissents by Federal Circuit judges in Athena Diagnostics Inc. v. Mayo Collaborative Services LLC is likely to fall on deaf ears, having already done so when the Court denied Athena's cert petition.  The petition is perhaps on firmer ground when adding a reminder of the Government's views, from the Solicitor General in Hikma Pharm. USA Inc. v. Vanda Pharma. Inc. (see "Solicitor General Recommends That Supreme Court Deny Certiorari in Hikma Pharmaceuticals v. Vanda Pharmaceuticals"), because there the SG urged the Court to revisit its subject matter eligibility jurisprudence just not in that case (specifically stating (and quoted in this petition) that "further guidance from this Court is amply warranted" and should be provided "in a case where the current confusion has a material effect on the outcome of the Section 101 analysis).  This gives this petition the opportunity to affirmatively state that "[t]his is just such a case."

As a reminder, the case involved methods (and devices) for treating infants with inhaled nitric oxide gas; perhaps more accurately, the claims recited methods to identifying infants in respiratory distress who should not be administered the conventional iNO treatment, due inter alia to their having a congenital defect, left ventricular hypertrophy, which predisposed such infants to pulmonary edema.  Illustrative claims of the patents-in-suit* include:

Claim 1 of U.S. Patent No. 8,795,741:

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.

Claim 1 of U.S. Patent No. 8,776,794:

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 Federal Circuit's decision).

The District Court held/found that the claims of the HF patents (vide infra) were directed to patent-ineligible subject matter, and a divided panel of the Federal Circuit affirmed; the Court refused to rehear the decision en banc.

The petition terms method-of-treatment claims as "the one island of stability" in subject matter eligibility jurisprudence, which the decision below has disrupted by "extend[ing] the judicially created exceptions to the plain text of 35 U.S.C. §101 far beyond anything envisioned by this Court," characterizing the case as an opportunity for the Supreme Court to "rein in the Federal Circuit's runaway jurisprudence" on § 101 that "threatens innovation at the forefront of medical science."  The petition asserts three reasons why the Court should grant certiorari.  First, the decision below "heightens confusion" because it is contradictory to the "traditional understanding" (not upset by the Court's decision in Mayo) that method-of-treatment claims are eligible for patenting.  The petition illustrates this confusion by returning to statements made by most of the Federal Circuit judges in concurrences and dissents in Athena, as well as additional similar statements in Interval Licensing LLC v. AOL, Inc., 896 F.3d 1335, 1348 (Fed. Cir. 2018) by Judge Plager; Berkheimer v. HP Inc., 890 F.3d 1369, 1374 (Fed. Cir. 2018) by Judges Lourie and Newman; Smart Sys. Innovations, LLC v. Chicago Transit Auth., 873 F.3d 1364, 1377 (Fed. Cir. 2017) by Judge Linn; and Ariosa Diagnostic, Inc. v. Sequenom Inc., 788 F.3d 1371, 1381 (Fed. Cir. 2015) by Judge Linn; (where the combination of such citations may be effective to further illustrate this confusion).  The petition terms this an "extraordinary" "collective and consistent cry for help from the Federal Circuit" with evident justification.  The petition also cites such luminaries as former Chief Judge Paul Michel, in testimony before the Senate Subcommittee on Intellectual Property last June (see "Senate Subcommittee on Intellectual Property Holds Hearings on Proposed Revisions to 35 U.S.C. § 101"), public statements by current PTO Director Andrei Iancu and former Director David Kappos, testimony by practitioners and patent law groups (Including the American Bar Association and American Intellectual Property Lawyers Association), and legal scholars (including Mark Lemley and Christopher Holman), all asserting that the uncertainty created by inconsistent decisions by the Federal Circuit and district courts are harmful to innovation and the patent system.

The petition then turns to the potential for harm this decision poses, in disrupting the "island of stability" of patent eligibility for method-of-treatment claims, citing Natural Alternatives Int'l. Inc. v. Creative Compounds, LLC, 918 F.3d 1338 (Fed. Cir. 2019), and Endo Pharma. Inc. v. Teva Pharm. USA Inc., 919 F.3d 1347 (Fed. Cir. 2019), as well as Vanda.  This case "breaches that firewall" by holding for the first time that a method-of-treatment claim is patent ineligible.  The petition characterizes as the Federal Circuit "finess[ing] the point" by considering the claims to instruct inaction, which Petitioner counters by interpreting Mallinckrodt's claims as being directed to "an integrated treatment protocol" involving "selective action" (anticipating at least some of the argument Respondent can be expected to make).  And the evils this decision could occasion are not limited to such selective treatment claims, the petition asserting that this principle "could reach . . . manufacturing processes in which testing and predefined criteria are used to determine whether a step previously performed on all batches can be skipped in some instances, increasing efficiency . . .," this argument taking the issue outside the realm of diagnostics and illustrating the potential scope of the problem.

The petition next makes the bald assertion that "the Federal Circuit's decision is wrong."  And the basis for the statement is, first, that Congress spoke expansively in drafting Section 101 and the implicit judicial exceptions recognized by the Court are not as expansive as the Federal Circuit's decision below makes them.  The petition characterizes (properly) the claims in Mayo as being "an oddity" and accordingly, readily distinguishable from Mallinckrodt's claims (most easily by noting that the Mayo claims did not require any action on the part of a physician who had practiced the claimed method to determine whether the amount of administered drug was in the therapeutic range).  The Federal Circuit's mistake here was in disregarding this distinction and in failing to heed the Court's prescription that claims must be considered as a whole, citing (of course) Diamond v. Diehr, 450 U.S. 175, 188 (1981).  The petition also criticizes the decision below for attempting to distinguish the Vanda decision (noting that the author of this opinion dissented in that one), the deficiency in the attempt being crafting an "arbitrary distinction" between "treating and not treating" steps neither found or required by the statute or the Court's eligibility decisions (and further noting that the scope of the Vanda claims were even broader, wherein was claimed all dosages of the drug at 12 mg/day or less, while the claims here recited a "single, specific course of action," the petition reciting unclaimed, potential alternatives that reduced the scope of preemption).

The final reason the petition asserts supporting the Court's grant is the threat to personalized medicine, which Petitioner calls "the next frontier of medical research."  While compelling writing, such paeans to the coming beneficent future and the threat subject matter eligibility restrictions pose to it have become commonplace (due, at least in part, to the truth of these assertions), but frankly the Court has shown no tendency to be persuaded by them.  Perhaps this is due to the expected salvo of amicus briefing and legal and popular literature to the contrary, that patenting is a tax and an impediment to innovation, and perhaps it reflects the individual Justice's views on the proper place for patents involving medicine.  No matter how well written or how cogent the arguments made (here, by Seth Waxman, a preeminent Supreme Court advocate), it is hard to place much hope in any change of heart in this regard by the Court in this case.

Mylan will have an opportunity to file a responsive brief in due course, and the Court should it grant certiorari can be expected to hear argument in the Fall term (COVID-19 willing).

* The full list of claims asserted by iNO and Mallinckrodt include U.S. Patent Nos. 8,282,966; 8,293,284; 8,795,741; 8,431,163; and 8,846,112, collectively termed the "heart failure patents" or "HF patents," and U.S. Patent Nos. 8,573,209; 8,776,794; 8,776,795; 9,265,911; and 9,295,802, collectively termed the "delivery system infrared patents" or "DSIR patents."

Illumina, Inc. v. Ariosa Diagnostics, Inc. (Fed. Cir. 2020)

By Kevin E. Noonan --

The latest Federal Circuit decision on subject matter eligibility in the life sciences came down (by a divided court) in favor of eligibility, in Illumina, Inc. v. Ariosa Diagnostics, Inc.  The claims at issue fell into the third "bucket" of eligibility, being neither diagnostic method claims (always ineligible at the Federal Circuit) nor method of treatment claims (eligible, at least until the Supreme Court grants certiorari in the next iteration of Vanda Pharmaceuticals Inc. v. West-Ward Pharmaceuticals), but rather (as denoted in the majority opinion), method of preparation claims, a philosophical cousin to the claims in Rapid Litig. Mgmt. Ltd. v. CellzDirect, Inc.  And as an added bonus, Judge Reyna dissented in a manner that illustrates his thinking on patent eligibility of inventions involving natural phenomena (and natural products).

The case arose over U.S. Patent No. 9,580,751 (the '751 patent) and U.S. Patent No. 9,738,931 (the '931 patent), directed to the solution of an unexpected difficulty in detecting cell-free fetal DNA (cffDNA):

[T]he major proportion (generally >90%) of the extracellular DNA in the maternal circulation is derived from the mother.  This vast bulk of maternal circulatory extracellular DNA renders it difficult, if not impossible, to determine fetal genetic alternations [sic] . . . from the small amount of circulatory extracellular fetal DNA.

The inventors found that cffDNA was significantly smaller (300-500 bp) than the "interfering" maternal DNA, and thus using admittedly conventional techniques of size separation the cffDNA could be isolated and rendered detectable.

Illumina and Sequenom asserted claims 1, 2, 4, 5, 9, and 10 of the '751 patent and claims 1, 2, and 10–14 the '931 patent against Ariosa and Roche Diagnostics; the Court considered claim 1 from each patent to be representative:

'751 patent:

1.  A method for preparing a deoxyribonucleic acid (DNA) fraction from a pregnant human female useful for analyzing a genetic locus involved in a fetal chromosomal aberration, comprising:
    (a) extracting DNA from a substantially cell-free sample of blood plasma or blood serum of a pregnant human female to obtain extracellular circulatory fetal and maternal DNA fragments;
    (b) producing a fraction of the DNA extracted in (a) by:
        (i) size discrimination of
        (ii) selectively removing the DNA fragments greater than approximately 500 base pairs,
        wherein the DNA fraction after (b) comprises a plurality of genetic loci of the extracellular circulatory fetal and maternal DNA; and
    (c) analyzing a genetic locus in the fraction of DNA produced in (b).

'931 patent:

1.  A method, comprising:
    (a) extracting DNA comprising maternal and fetal DNA fragments from a substantially cell-free sample of blood plasma or blood serum of a pregnant human female;
    (b) producing a fraction of the DNA extracted in (a) by:
        (i) size discrimination of extracellular circulatory fetal and maternal DNA fragments, and
        (ii) selectively removing the DNA fragments greater than approximately 300 base pairs,
    wherein the DNA fraction after (b) comprises extracellular circulatory fetal and maternal DNA fragments of approximately 300 base pairs and less and a plurality of genetic loci of the extracellular circulatory fetal and maternal DNA fragments; and
    (c) analyzing DNA fragments in the fraction of DNA produced in (b).

The District Court on summary judgment held these claims and all asserted claims to be ineligible under 35 U.S.C. § 101 and the Supreme Court's Alice/Mayo test (see "Illumina, Inc. v. Ariosa Diagnostics, Inc. (N.D. Cal. 2018)"), and this appeal followed.

The Federal Circuit reversed, in an opinion by Judge Lourie joined by Judge Moore; Judge Reyna (the author of the Court's Ariosa Diagnostics Inc. v. Sequenom, Inc. decision) dissented.  Judge Lourie got right to the point, stating "[t]his is not a diagnostic case.  And it is not a method of treatment case.  It is a method of preparation case."  The opinion acknowledged the consistent precedent post-Mayo that diagnostic method claims are ineligible, and method of treatment claims are eligible, citing Judge Moore's dissent from denial of rehearing en banc in Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC ("Since Mayo, we have held every single diagnostic claim in every case before us ineligible."); the panel decision in Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC; Cleveland Clinic Found. v. True Health Diagnostics LLC, 859 F.3d 1352 (Fed. Cir. 2017); and Cleveland Clinic Found. v. True Health Diagnostics LLC.  The panel majority also recognized that the Court had consistently held method of treatment claims to be patent-eligible, citing Endo Pharm. Inc. v. Teva Pharm. USA, Inc.; Natural Alternatives Int'l, Inc. v. Creative Compounds, LLC; and, of course, Vanda Pharm. Inc.

The majority appreciated a distinction lost on the dissent:  "[h]ere, it is undisputed that the inventors of the '751 and '931 patents discovered a natural phenomenon.  But at step one of the Alice/Mayo test, 'it is not enough to merely identify a patent-ineligible concept underlying the claim; we must determine whether that patent-ineligible concept is what the claim is 'directed to," citing Rapid Litig. Mgmt. Ltd. v. CellzDirect, Inc.

The majority understood the natural phenomenon underlying the claimed invention to be "that cell-free fetal DNA tends to be shorter than cell-free maternal DNA in a mother's bloodstream" despite some apparent inconsistencies in how at least Roche enunciated its interpretation.  The critical question as understood by the majority was "whether the claims are 'directed to' that natural phenomenon."  The majority held that the claims were not directed to the natural phenomenon but rather were directed to "a patent-eligible method that utilizes it."  In support of this conclusion, Judge Lourie wrote regarding the specificities of the claims (albeit not the five specificities he identified in his Vanda opinion).  These include "specific process steps—size discriminating and selectively removing DNA fragments that are above a specified size threshold" that increased the relative amount of cffDNA in the processed sample compared to maternal DNA.  The claimed method "change[d] the composition of the mixture" and produced a DNA-containing fraction that was different from what naturally occurs in maternal blood.  This was what distinguished, for the majority, what was claimed from merely "observing that fetal DNA is shorter than maternal DNA or detecting the presence of that phenomenon."

The written description of the invention (upon which the dissent extensively relied to draw the opposite conclusion) supported this view, according to the opinion:

As described by the specification, the inventors used these concrete process steps, not merely to observe the presence of the phenomenon that fetal DNA is shorter than maternal DNA, but rather to exploit that discovery in a method for preparation of a mixture enriched in fetal DNA.

The panel majority distinguished the decision in Ariosa, where the claims were directed to a method "for detecting a paternally inherited nucleic acid" (claims 1 and 24) or a method "for performing a prenatal diagnosis" (claim 25).  The only steps recited in those claims were related to making more of the cffDNA by amplification, followed by a detecting or sequencing step.  As in Mayo, Athena, and Cleveland Clinic, the Sequenom claims were directed to detecting a natural phenomenon:  the Sequenom inventors "discovered that cell-free fetal DNA exists, and then obtained patent claims that covered only the knowledge that it exists and a method to see that it exists.  Those claims were thus ineligible."  In contrast, the claims at issue here were not directed to the correlation between cffDNA size and its "tendency" to be maternal or fetal in origin.  The claims at issue here is produced a fraction enriched in fetal DNA, which distinguished them from the invalid claims in Ariosa for the panel majority.

And regarding the effect the Supreme Court's AMP v. Myriad Genetics decision has on these claims, the majority states:

Thus, in Myriad, the claims were ineligible because they covered a gene rather than a process for isolating it.  Here, we encounter the opposite situation, i.e., the claims do not cover cell-free fetal DNA itself but rather a process for selective removal of non-fetal DNA to enrich a mixture in fetal DNA.  Thus, the Supreme Court's decision in Myriad is not on point.

With regard to the Cellzdirect precedent, the panel majority analogized by noting that those inventors did not "invent" hepatocytes, but rather invented a method for making preparations of them that relied on the hepatocytes natural ability to be subjected to multiple rounds of freezing and thawing unappreciated in the prior art.  For the majority, the '751 and '931 patents similarly do not claim (and the inventors do not assert they had invented) cffDNA or even the differential size distribution between maternal and fetal DNA in maternal blood.  The panel majority recognized that the inventors here relied on this natural phenomenon to invent a method of separating cffDNA into an enriched fraction by "physical process steps" that "selectively remove some maternal DNA in blood to produce a mixture enriched in fetal DNA."

The majority summarized its opinion as follows:

The inventors here patented methods of preparing a DNA fraction.  The claimed methods utilize the natural phenomenon that the inventors discovered by employing physical process steps to selectively remove larger fragments of cell-free DNA and thus enrich a mixture in cell-free fetal DNA.

Judge Reyna dissented, his dissent nicely setting forth the philosophical differences between the members of this Court (as well as the Supreme Court) for whom the eligibility/ineligibility dichotomy is categorical:  once a "natural phenomenon" is identified, the invention cannot be patented (despite Judge Reyna's protestations at the end of his dissent that "process claims that involve naturally occurring phenomena from beginning to end could be directed to patent eligible subject matter, but this is not such a case" -- there will never be such a case).

The dissent recites the conventional view that applying routine, well-understood, and conventional methods to a newly discovered natural phenomenon is enough, per se, to preclude patent eligibility.  What Judge Reyna continues to refuse to acknowledge (and he is not alone in this particular brand of short-sightedness) is that there is nothing routine, well understood, and conventional (and cannot be) in using old techniques in new ways.  Indeed, there would be very little patenting if the use of older technology could not be a part of innovation; after all, the goal of building a better mousetrap would be considerably more difficult if the existence of a mousetrap itself preluded patenting a better one.

Judge Reyna states that "the claims are directed to a natural phenomenon [because the] patents' only claimed advance is the discovery of that natural phenomenon," which for him categorically precludes patent eligibility.  Ignoring the fact that the claimed methods permit cffDNA to be detected, in his view "[t]he inventors discovered a natural phenomenon: that cffDNA tends to be shorter than cell-free maternal DNA in a mother's blood.  Other than the surprising discovery, nothing else in the specification or the record before us indicates there was anything new or useful about the claimed invention."  And he disregards the distinction drawn by the majority between "method of preparation" claims and method of treatment or diagnostic claims, stating that "[a] 'method of preparation case' is treated no differently than any other process claim under our law," not considering the differential treatment (even by Justice Breyer in Mayo) between cases like Parker v Flook and Diamond v Diehr.

Regarding the significance of the written description to the question of whether the claims are "directed to" a natural phenomenon, the dissent appears to assert that if the invention identifies or recites a natural phenomenon, it is per se directed to the natural phenomenon, wherein the written description supports ineligibility merely by identifying the natural phenomenon (and seemingly equating an invention "based on" a natural phenomenon with one that is directed to it):

If a written description highlights the discovery of a natural phenomenon—e.g., by describing the natural phenomenon as the only "surprising" or "unexpected" aspect of the invention or that the invention is "based on the discovery" of a natural law—the natural phenomenon likely constitutes the claimed advance" [citing Ariosa, Athena, and Cleveland Clinic].

(Somewhat annoyingly, the dissent consistently brackets the term "surprising" with quotation marks; a jurist doesn't need to agree that "surprisingness" is enough to confer patent eligibility, but there is nothing in the record to refute that the results were surprising to one of ordinary skill in the art, the only actor whose "surprise" at the discovery is legally relevant).

Touching sub silentio on how the Court has interpreted claims involving natural products after Myriad, the dissent further states that ineligibility is supported by "[t]he fact that the claimed method steps begin and end with a naturally occurring substance, as in Ariosa" and that "[t]he inventors did not create or alter any of the genetic information encoded in the cff-DNA in the claimed method steps," which seems on its face to be contrary to the Supreme Court's Diamond v Chakrabarty decision.  Nevertheless, Judge Reyna states:

Likewise, the claimed method here begins and ends with a naturally occurring substance.  The claimed method begins with extracting a sample of blood plasma or serum from a pregnant mother that consists wholly of various naturally occurring substances, including cff-DNA.  The claimed method separates those naturally occurring substances by size, leaving a "fraction" of the original sample that is predominantly cff-DNA.  The claimed method ends with analyzing the components of the "fraction," which contains cff-DNA.  The substances present throughout the process are naturally occurring substances, and the claimed method steps do not alter those substances [except, of course, by enriching them in the resulting fraction].  The claimed method is therefore directed to a natural phenomenon.

The dissent is also focused on whether the claims constitute an "advance" in the art (ignoring the "advance" that the invention permits cffDNA to be analyzed):

Where a written description identifies a technology as well-known or performed using commercially available tools or kits, that technology cannot logically constitute a claimed advance" [citing Ariosa, Athena  (identifying the claimed "immunological assay techniques [as] known per se in the art" and therefore not the claimed advance); and Cleveland Clinic (relying on the patent's disclosure of "commercially available testing kits" for detecting the natural law)].

There is an apparent difference between how the majority and the dissent consider the Court's CellzDirect precedent.  Judge Reyna appreciates as a distinction that, in Cellzdirect, "the inventors created a new and useful cryopreservation technique comprising multiple freeze-thaw cycles" that went beyond applying a known laboratory technique to a newly discovered natural phenomenon and, instead, created an entirely new laboratory technique."  The claim in the Cellzdirect case does not support this interpretation:

1.  A method of producing a desired preparation of multi-cryopreserved hepatocytes, said hepatocytes being capable of being frozen and thawed at least two times, and in which greater than 70% of the hepatocytes of said preparation are viable after the final thaw, said method comprising:
    (A) subjecting hepatocytes that have been frozen and thawed to density gradient fractionation to separate viable hepatocytes from non- viable hepatocytes,
    (B) recovering the separated viable hepatocytes, and
    (C) cryopreserving the recovered viable hepatocytes to thereby form said desired preparation of hepatocytes without requiring a density gradient step after thawing the hepatocytes for the second time, wherein the hepatocytes are not plated between the first and second cryopreservations, and wherein greater than 70% of the hepatocytes of said preparation are viable after the final thaw.

The only difference between conventional method of cryopreservation and the claimed invention was that the claims direct that conventional methods be performed twice.  It is ironic that this repetition is sufficient to distinguish the claims here under these circumstances.

The biggest risk of the philosophy enunciated in this dissent is this:

The Majority's reasoning is shortsighted.  A process that merely changes the composition of a sample of naturally occurring substances, without altering the naturally occurring substances themselves, is not patent eligible" [citing Genetic Techs. and Ariosa, both of which involved claims reciting PCR amplification of specific DNA sequences].

If this was ever to be the law it would preclude on patent eligibility grounds claims to any natural product that differed solely by its isolation and concentration, again seemingly contrary to Supreme Court precedent.

Illumina, Inc. v. Ariosa Diagnostics, Inc. (Fed. Cir. 2020)
Panel: Circuit Judges Lourie, Moore, and Reyna
Opinion by Circuit Judge Lourie; dissenting opinion by Circuit Judge Reyna

What is an Abstract Idea, Anyway?

By Michael Borella --

In 2014's Alice Corp. v. CLS Bank Int'l case, Justice Thomas famously wrote, "we need not labor to delimit the precise contours of the 'abstract ideas' category in this case."  Instead, he found the claims of patentee Alice to have "no meaningful distinction" under 35 U.S.C. § 101 from those the Court previously found ineligible in Bilski v. Kappos.

Since then, the abstract idea inquiry has been applied by the Federal Circuit over 100 times in various ways.  Initially, there was some hope that this category may be limited to financial transactions or certain types of computer-implemented business methods.  Not so.  Recently, network-controlled electric car charging stations and garage door openers were found to be abstract in ChargePoint, Inc. v. SemaConnect, Inc. and The Chamberlain Group, Inc. v. Techtronic Industries Co., respectively.  These inventions join a long list of those found too abstract for patenting, including claims for displaying advertisements in before content in a video distribution service, dynamic tabs on a user interface, administration of digital images, monitoring of an electrical power grid, and computer virus screening just to name a few.

Even with all of these appellate opinions, the legal definition of "abstract idea" remains remarkably elusive.  Notably, in Interval Licensing LLC v. AOL, Inc., Judge Plager of the Federal Circuit wrote, "a search for a definition of 'abstract ideas' in the cases on § 101 from the Supreme Court, as well as from this court, reveals that there is no single, succinct, usable definition anywhere available."  Last year, the U.S. Patent and Trademark Office (USPTO) published patent eligibility examination guidance that defined three classes of abstract idea (mental processes, mathematical concepts, and methods of organizing human activity).  This demonstrates that the USPTO is struggling to have its examining corps of thousands apply Alice consistently.  But the courts have not adopted the USPTO's view of the world, and the Federal Circuit has explicitly stated that it is not bound by the guidance.

Denying one a property right or taking one's granted property right away based on such ill-defined criteria seems suspicious if not straight from the mind of a genetically-engineering offspring of George Orwell, Franz Kafka, and Terry Gilliam.  And yet, here we are.

The Google dictionary definition of "abstract" is "existing in thought or as an idea but not having a physical or concrete existence."  But one cannot square such a definition with the case law.  Some of the claims in Alice were found abstract despite reciting physical, tangible computer hardware.  Indeed, pure software written in code is stored on a physical tangible medium, such as a disk drive, flash memory, CDROM, etc.  While thinking about software is abstract, the code and equipment that makes your computer display this article -- or do anything else for that matter –– is not.  The dictionary definition does not help us decode how the courts are applying § 101.

Instead, the abstract idea is an elaborate legal fiction that has little to do with the layperson's understanding of what might or might not be abstract.  Without being grounded in statute or plain meaning, it is not hard to see why patentees, patent attorneys, the USPTO, and federal judges remain unable to agree on whether certain types of inventions are eligible for patenting.  And this gray area covers many types of inventions that are not only at the bleeding edge of research, but also crucial to the U.S. economy and competitiveness.  Artificial intelligence, machine learning, data science, and quantum computing innovations are more difficult to patent due to Alice and its progeny.[1]

A Concise Definition

Can one synthesize the aforementioned 100-plus Federal Circuit decisions applying the abstract idea test and come to a more clear understanding of what this category entails?  A daunting task no doubt, but one that I will attempt to address (with a handful of caveats, of course).

Particularly, in view of post-Alice Federal Circuit case law:

a claim is not directed to an abstract idea if it includes at least one element that is a specific, technical improvement that is not found in the prior art.

Let's break this down by stating the converse -- a claim is directed to an abstract idea if all of its elements are non-specific, address a non-technical problem, or are known in the art.  Thus, in order for a claim to be successful under § 101, it should have three qualities:  specificity, a technical problem that it solves, and some degree of novelty.  I will address each of these notions in turn.

Specificity

In ruling the invention in McRO, Inc. v. Bandai Namco Games America Inc. eligible, the Federal Circuit used the word "specific" or "specifically" at least 15 times when referring to the claims.  Similar usage of "specific" as a root word can be found in Enfish LLC v. Microsoft Corp., Trading Techs Int'l v. CQG, Inc., and SRI Int'l Inc. v. Cisco Systems Inc. -- in each of these cases, claims were ruled eligible.  In contrast, the Court in Chamberlain lamented the lack of specificity of the claims under review, which -- as noted above -- were found ineligible.

An aspect of specificity is whether the claims recite an outcome or how to achieve that outcome.  Purely outcome-oriented claims often appear functional, indicating what the invention provides rather than how the invention provides it.  In Electric Power Group, LLC v. Alstom S.A., the Court found the claims therein ineligible due to their "defining a desirable information-based result and not [being] limited to inventive means of achieving the result."  Likewise, in Two-Way Media Ltd. v. Comcast Cable Communications, LLC, the Court criticized one of the claim's "result-based functional language."  Particularly, "[t]he claim requires the functional results of converting, routing, controlling, monitoring, and accumulating records, but does not sufficiently describe how to achieve these results in a non-abstract way."  It is not hard to find more examples of claims that have fallen due to lacking specificity regarding the steps needed to carry out the invention.

Indeed, there are five types of specificities that can appear in a claim.[2]  Ideally for § 101 purposes, a claim recites a specific function of a specific element that does something in a specific way to obtain a specific result and thus solve a specific problem.  Not all five specificities need be present in each claim, but the more of these specificities there are, the more likely the claim will survive an eligibility challenge.  Conversely, the fewer specificities in the claim, the more likely it will be found abstract.

If you are thinking that specificity of claim language should be handled by the definiteness, enablement, and written description requirements of § 112 you would not be wrong.  But one of the odd aspects of post-Alice case law is how the § 101 test has evolved to take on characteristics from the § 112 tests.  This evolution has not gone unnoticed at the Federal Circuit.  In American Axle & Mfg. v. Neapco Holdings LLC, Judge Moore wrote in dissent that the majority had applied an enablement test in the guise of eligibility.[3]

Addressing a Technical Problem

But claims require more than just specificity to be eligible.  There are numerous examples of narrow, specific claims that fell to a § 101 challenge, including those of Trading Techs. Int'l, Inc. v. IBG LLC ("[t]he claims are focused on providing information to traders in a way that helps them process information more quickly, not on improving computers or technology"),[4] Versata Development Group, Inc. v. SAP America, Inc. (a claim "akin to creating organizational management charts" fails to "solve a technical problem using a technical solution"), Shortridge v. Foundation Construction Payroll Service, LLC ("generating certified payroll records is an abstract business practice"), and SAP America, Inc. v. InvestPic, LLC ("Under the principles developed in interpreting § 101, patent law does not protect [an advance in mathematical techniques in finance], without more, no matter how groundbreaking the advance").  Thus, specificity will only get you so far and is not the complete answer to the § 101 riddle.

But Trading Techs, Versata, Shortridge, and SAP America all exhibit an unfavorable characteristic -- they are more directed to solving business problems rather than technical problems.  While there is no statutory notion in the U.S. that patents only protect solutions to technical problems, the America Invents Act did introduce the Covered Business Method Review process.  This, along with Alice, may have resulted in the Federal Circuit feeling like it has license to look askance at business methods, with the district courts and USPTO following.

What exactly is a difference between solving a technical problem versus a business problem?  For guidance, we can look to Europe and other jurisdictions where such a concept has been in place for years.  Along these lines of thinking, inventions exist on a spectrum from those addressing technical problems by improving the operation of machines (e.g., engine control, error correction coding of signals, multiprocessing), to those addressing the operation of a business (e.g., derivative trading, hedging risk analysis, ecommerce, and retail schemes).  The former is much more likely to be patentable than the latter.  In the middle, we have a gray area of inventions that improve human performance or life in general (e.g., film animation, desktop communication applications, video game avatar controls).  These inventions could go either way.

Indeed, the Federal Circuit has even found inventions that are claimed rather broadly to be eligible due to their technical nature.  In SRI, claims addressing a hierarchical network monitoring system were found rooted in computer technology in order to solve a specific problem arising in the realm of network computing.  Likewise, claims in Koninklijke KPN N.V. v. Gemalto M2M GmbH were also found eligible "because they are directed to a non-abstract improvement in an existing technological process."

Thales Visionix Inc. v. U.S. is a notable case in this category, where remarkably broad claims were found to be eligible because the accompanying specification explained in detail the technical improvement they provided.  But one should not conclude that specificity can be replaced by a technical improvement.  Claims with both fare better, and Thales may be an outlier.  A lengthy explanation of an invention's technical character in the specification (when argued properly) probably cannot hurt claims, but it will not guarantee success if the claims are outcome-oriented.

The USPTO's Patent Trial and Appeal Board (PTAB) seems to be taking the European approach.  Recently, the PTAB published a number of informational decisions applying the USPTO's latest examination guidance.  The outcomes of these cases break along the technical problem to a technical solution line.  An invention directed to optimizing the signal to noise ratio from reception coils of an magnetic resonance tomograph was found to meet the § 101 requirements, as was an invention focused on transforming the coordinate system of catheter navigation to the coordinate system of an external model or external image data.  On the other hand, software for selecting a golf club with a suitable loft angle and software for creating a life-cycle workflow for a project were found ineligible due to their addressing non-technical problems.

Nonetheless, the contours of the business method are somewhat malleable and in the eyes of the beholder.  There are instances of the Federal Circuit finding claims to be eligible where those claims are ostensibly business-oriented.  In Trading Techs Int'l v. CQG, Inc., the Court concluded that claims directed to a securities trading user interface was sufficiently technical because it solved existing problems in such interfaces.  In DDR Holdings, LLC v. Hotels.com L.P., the Court found that the claimed solution of "generating a composite web page that combines certain visual elements of a host website with content of a third-party merchant" to be technical and "necessarily rooted in computer technology," despite arguably addressing the business-oriented problem of retaining or increasing web site traffic.

Not in the Prior Art

Patent eligibility under § 101 was not intended to be a prior art test, but it has become one.  Despite Judge Moore's criticism of the Court's combining § 112 considerations into § 101, her opinion in Berkheimer v. HP Inc. introduces factual considerations of prior art under §§ 102 and 103 into part two of the Alice test (the search for an inventive concept where one must consider whether claim elements are well-understood, routine, and conventional).  But the cross-contamination of eligibility and prior art began before Berkheimer.  Indeed, comparisons between claimed inventions and prior art are found in a vast number of § 101 decisions including the aforementioned KPN, Chamberlain, Enfish, and McRO cases, as well as Cellspin Soft, Inc. v. Fitbit, Inc., Data Engine Technologies LLC v. Google LLC, Core Wireless Licensing S.A.R.L. v. LG Electronics, Inc., and Internet Patents Corp. v. Active Network, Inc., just to name a few.

The exact nature of this de facto prior art analysis under § 101 is unclear.  Not only does it impact the second part of the test but also the first part.  For example, in Chamberlain, the Court found the claims abstract after noting that the "only described difference between the prior art movable barrier operator systems and the claimed movable barrier operator system is that the status information about the system is communicated wirelessly" and that wireless communication is an abstract concept.  Rather than analyzing claims as a whole under part one as was set forth in Enfish and McRO, recent Federal Circuit cases appear to be dividing claims into elements within the prior art and those that are not.  The Court then only considers whether the non-prior-art elements are specific and technical enough to be more than an abstract idea.

But what if all of your claim elements are in the prior art, but your claims recite a combination that is not?  As noted, even though claims are supposed to be analyzed as a whole under part one of Alice and as an ordered combination under part two, these analyses get short shrift in practice.  In cases like Chamberlain and InvestPic, the Federal Circuit provided conclusory reasoning by using variations of the phrase "when considered as an ordered combination, the components of each claim add nothing that is not already present when the steps are considered separately."  This language is derived from Mayo, and similar wording regarding ordered combinations can be found in numerous district court and PTAB decisions.  Bottom line -- relying on claims being viewed as a whole or as an ordered combination is risky.

Analysis

To be clear, the definition I propose is not perfect, and is merely an attempt to fit a line through a messy set of data points.  Still, following this approach can provide a sense of how likely it is for your invention to avoid § 101 issues, or whether drafted claims should be edited or amended to become more clearly eligible.  While some of these factors might be able to be downplayed in certain situations, the more specific, technically-oriented, and novel your claimed invention, the higher the probability of a desirable outcome.

Notably, this definition is not the two-part Alice test.  There is no "directed to" or "inventive concept" inquiries.  In practice, the Alice test often effectively has only one part -- whether the claim is directed to a judicial exception.  In conducting this inquiry for the abstract idea category, one considers the claim's specificity, technical character, and whether it recites elements in the prior art.  Therefore, I posit that the definition proposed is a more coherent representation of the process actually carried out than the disparate articulations of Alice in the last five-and-a-half years of Federal Circuit case law.

[1] Medical diagnostics and genetic engineering are other high-value fields that suffer from the Supreme Court's rulings, though inventions in these areas are generally subject to the natural phenomenon or law of nature exceptions to eligibility, and are thus controlled by Mayo Collaborative Services v. Prometheus Labs., Inc. and Association for Molecular Pathology v. Myriad Genetics rather than just Alice.

[2] These five specificities are different but in the same spirit as those introduced by Judge Lourie in Vanda Pharmaceuticals v. West-Ward Pharmaceuticals.  In that case, he wrote "[a]t bottom, the claims here are directed to a specific method of treatment for specific patients using a specific compound at specific doses to achieve a specific outcome."

[3] Admittedly, the judicial exception in American Axle was a law of nature, but Judge Moore's general reasoning holds.

[4] There are multiple Federal Circuit cases with this heading, and the one decided April 30, 2019 is referred to here.

A Step-by-Step Approach to Patent Subject Matter Eligibility Reform

By Kevin E. Noonan --

There is a belief in some quarters that the most significant barrier to patent subject matter eligibility reform is an implacable opposition by companies in the high tech sector because those companies are convinced that the recent Supreme Court precedent (Bilski/Mayo/Alice) as interpreted by the Federal Circuit has resulted in a diminution in lawsuits by so-called "patent trolls," non-practicing entities who accumulate patents to be asserted against these companies.  Sitting in yet another patent conference, surrounded by some of the most erudite members of the patent community (judges and former judges, PTO officials current and past, distinguished patent lawyers and company IP counsel), discussing the current (parlous) state of affairs regarding patent subject matter eligibility and the inability (Federal Circuit, Congress) or unwillingness (Supreme Court) to find a solution, it is impossible not to think that the way the issue has been addressed is, at best, insufficient.  If indeed the issue cannot be resolved politically between the high tech and biotech/pharma shareholders, then it seems evident that this issue -- the attachment to the status quo by the high tech community because it serves their interests -- must be resolved before any solution to the problem for all other technologies becomes possible.

Past experience may provide an avenue for such a resolution.  In the 1990's, patent law was faced with claims directed to methods for performing eye surgery.  The patent, U.S. Patent No. 5,080,111 to Dr. Pallin, was being asserted (Pallin v. Singer, 1996 WL 274407 (D. Vt., Mar. 28, 1996)) against medical doctors and eye clinics and prompted swift Congressional action.  The measure that ultimately passed, introduced by Senator Bill Frist of Tennessee (himself a physician) was codified as 35 U.S.C. § 287(c):

35 U.S.C. 287 Limitation on damages and other remedies; marking and notice.

* * *

(c)(1) With respect to a medical practitioner's performance of a medical activity that constitutes an infringement under section 271(a) or (b) of this title, the provisions of sections 281, 283, 284, and 285 of this title shall not apply against the medical practitioner or against a related health care entity with respect to such medical activity.

 * * *

    (3) This subsection does not apply to the activities of any person, or employee or agent of such person (regardless of whether such person is a tax exempt organization under section 501(c) of the Internal Revenue Code), who is engaged in the commercial development, manufacture, sale, importation, or distribution of a machine, manufacture, or composition of matter or the provision of pharmacy or clinical laboratory services (other than clinical laboratory services provided in a physician's office), where such activities are:
        (A) directly related to the commercial development, manufacture, sale, importation, or distribution of a machine, manufacture, or composition of matter or the provision of pharmacy or clinical laboratory services (other than clinical laboratory services provided in a physician's office), and
        (B) regulated under the Federal Food, Drug, and Cosmetic Act, the Public Health Service Act, or the Clinical Laboratories Improvement Act.

The policy justification for the bill was, as eloquently expressed by Senator Frist, because "innovations in surgical and medical procedures do not require the midwifery of patent law."  As enacted, the bill reflects a carefully crafted ("narrowly tailored") balance between the concerns of the medical community and the patent community at large, particularly the biotechnology community.  For example, "biotechnology patents" are expressly excluded from the exemption; such patents are defined (under 35 U.S.C. § 103(b)) as "a process of genetically altering of inducing a single or multi-celled organism" or "cell fusion procedures yielding a cell line that expresses a specific protein" or "methods of using a product produced" by the above processes.  Also not exempt are individuals involved in the commercialization of "a machine, manufacture, or composition of matter" related to a medical activity.

If indeed one of the major impediments to patent subject matter eligibility reform today is the concerns of the high tech community that the current state of the law is what has reduced the plague of patent troll litigation against them (regardless of the justification for these concerns), perhaps Congress should consider amending the patent statute to contain a similar exclusion for such alleged troll activity:

It shall not be an act of infringement under section 271(a) or (b) of this title, and the provisions of sections 281, 283, 284, and 285 of this title shall not apply, to practice of a method claim wherein any limitation of said claim is recited and defined solely by its function, unless the method is practiced using a structural component corresponding to that function that is expressly disclosed in the patent specification, or equivalents thereof.

While not providing a blanket license to infringe such a statutory provision would go far along the path of immunizing the targets of "troll"-asserted patent litigation.  It would limit the scope of infringement for claims reciting functional limitations to the express contribution disclosed in the specification, or equivalents thereof (analytics for which are available for assessing the scope of claims reciting limitations falling within the scope of 35 U.S.C. § 112(f)).  It would provide an avenue for such claims to be practiced without infringement liability merely by exercising the marginal creativity needed to employ a step in the method using structural components not recited in the specification and different enough in structure not to be an equivalent to what the specification expressly discloses.  It would also provide statutory protection from infringement that would bring a measure of certainty to companies who purportedly find themselves as deep-pocket targets of non-practicing patentees or patent assertion entities.

Of course, nothing involving patent subject matter eligibility law is certain or easy.  But eliminating the complaints of one set of shareholders in such a way might clear the path for Congress to address the concerns of other members of the patenting community, where additional creative stratagems might be productively employed.  Like Rome, patent subject matter eligibility will not be built in a day, but by taking a step-by-step approach perhaps it may be possible in our lifetimes.

Pebble Tide LLC v. Arlo Technologies, Inc. (D. Del. 2020)

Claims Directed to Capture and Output of Digital Content Held Patent Ineligible

By James Korenchan --

A few weeks ago, the U.S. District Court for the District of Delaware granted Defendants' Rule 12 motions in three different cases, each naming Pebble Tide LLC (hereinafter, "Pebble") as Plaintiff.  The Defendants in the three cases were Arlo Technologies, Inc., Uniden America Corp., and Petcube, Inc.  In granting the Rule 12 motions, the Court found the claims of two asserted patents -- U.S. Patent Nos. 10,261,739 (the '739 patent) and 10,303,411 (the '411 patent) -- to be invalid as being patent ineligible under 35 U.S.C. § 101.

The asserted patents were in the same family and generally related to client-server interactions for capturing and outputting digital content, most notably in the context of printing.  The invention includes a system having an "information apparatus" (e.g., a smartphone having a digital camera, or another computing device that can capture digital content), a server, and a client device (e.g., a computing device for accessing digital content).  The patents state that the invention addresses a need in the art for users to be able to easily output information from information apparatuses to printers or other devices that output content, without having to depend on synchronizing with "stationary" computers such as desktop computers.  The invention also aims to output information to such devices without having to find and install device-dependent or other specific types of drivers, and without losing the original quality of captured content.  More particularly, the patents specifically note that, with the invention, "[u]nlike conventional output or printing, a user does not have to manually pre-install a device driver (e.g., printer driver) from a CD, floppy disk, or download the driver somewhere from a network," which "is well-suited for providing output capability to small and lower-cost mobile devices with limited memory space, power supply and processing capability to still be able to output or print to an output device."  The patents also note that with the invention, "hardware and software installation for static or permanent network connectivity may not be necessary for the output device."

The parties agreed that claim 1 of the '739 patent is representative of the two patents.  It recites:

1.  A system for outputting output data, comprising:
    an information apparatus that includes a digital capturing device for capturing digital content, at least one wireless communication module for wireless communication, and at least one processor, the at least one processor directs the at least one wireless communication module to:
        establish a wireless communication connection with one or more servers over a network that includes the Internet, the one or more servers being distinct devices from the information apparatus;
        transmit, over the wireless communication connection, a device object that includes device information related to the information apparatus, from the information apparatus to the one or more servers; and
        provide, over the wireless communication connection, the digital content captured by the digital capturing device of the information apparatus, from the information apparatus to the one or more servers;
    server software executable at the one or more servers, the one or more servers include at least a network communication interface for network communication, and the one or more servers include memory for storing at least part of the digital content received from the information apparatus;
    client software executable at a client device, the client device is a distinct device from the information apparatus and from the one or more servers, wherein the client device includes:
        one or more wireless communication units for wireless communication,
        an output device for outputting output data; and
        one or more processors for executing at least part of the client software, wherein the client software provides, via the one or more wireless communication units of the client device, one or more job objects to the one or more servers over the network, the one or more job objects including at least one of security information or identification information for accessing the one or more servers, and the one or more job objects further include subscription information for accessing the one or more servers;
    wherein the server software further:
        receives, via the at least one network communication interface, the digital content from the information apparatus;
        stores, in the memory of the one or more servers, at least part of the received digital content;
        generates, at the one or more servers, output data for output at the client device, the output data is related to at least part of the digital content received by the one or more servers from the information apparatus, and the generating of the output data is related, at least partly, to at least a portion of the device object received by the one or more servers from the information apparatus; and
        provides, via the at least one network communication interface of the one or more servers, at least part of the output data, from the one or more servers to the client device, for outputting at least part of the digital content received from the information apparatus, the providing of at least part of the output data is subsequent to the one or more servers having received the one or more job objects from the client software at the client device; and
    wherein the client software further:
        receives, via the one or more wireless communication units of the client device, at least part of the output data from the one or more servers, and the receiving of the at least part of the output data is subsequent to the client device having provided the one or more job objects to the one or more servers over the network; and
        outputs at least part of the output data, received at the client device, at the output device associated with the client device.

If you read this claim and found it to be a long-winded way of describing the storage, generation, and transmission of data, you aren't alone.

In Alice Corp. v. CLS Bank Int'l, the Supreme Court set forth a two-part test for determining whether a claim is directed to patent-eligible subject matter under § 101.  First, it must be determined whether the claim involves a judicially-excluded law of nature, a natural phenomenon, or an abstract idea.  If so, it must be determined whether the claim recites an inventive concept -- that is, an element or combination of elements that is sufficient to ensure that the claim is significantly more than the judicial exclusion.  But generic computer implementation of an otherwise abstract process does not qualify as significantly more, nor does an element or combination of elements that is well-understood, routine, and conventional.

In applying the first part of the Alice test, the Court deemed claim 1 to be directed to an abstract idea of "wirelessly outputting data from one device to another," citing Cellspin Soft, Inc. v. Fitbit, Inc. ("we have consistently held that similar claims reciting the collection, transfer and publishing of data are directed to an abstract idea") in support of this conclusion.  The Court also reached this conclusion based on the similarities between this claim and those held by the Federal Circuit to be abstract in ChargePoint, Inc. v. SemaConnect, Inc. ("abstract claims directed to transmitting data from one device to another").  The Court also found the claim to be lacking technical details, stating that both the claims and the patents' specification merely describe the recited components in functional terms.

Turning to second part of the Alice test, the Court shot down a variety of seemingly scattered attempts at Pebble arguing that the claims recite an inventive concept, even after considering some constructions that Pebble more-recently proposed.  For instance, the Court briefly dismissed Pebble's notions that the "information apparatus" (which the specification states "generally refer[s] to computing devices") or the interplay of the job object process and the device object process is inventive.

The main focus of the Court's discussion on part two was on whether the ordered combination of the conventional computer components and processes is an inventive concept.  Pebble unsuccessfully tried to analogize the combination of elements recited in claim 1 to the claims in Cellspin, which involved steps for acquiring and transferring data from a data capture device to a mobile device.  In response, the Court noted that:

[T]he claims use merely functional language and that nothing in the claims or the specification details how this purported combination achieved the touted results of solving the problem of widespread incompatibility between wireless devices and corresponding output devices.

Pebble was also unsuccessful in trying to analogize claim 1 to BASCOM Global Internet Services, Inc. v. AT&T Mobility LLC.  In BASCOM, the Federal Circuit found the plaintiff's ordered combination of claim elements to be inventive after the plaintiff had demonstrated that its claims recited a specific, discrete implementation of an abstract idea and that the patent itself describes how the claimed arrangement of elements is a technical improvement over the prior art.  By contrast, the Court here believed Pebble was not able to make such a demonstration:

When I asked Pebble Tide's counsel to identify where the asserted patents or complaints concretely describe a specific method that was unconventional, he was unable to do so....  In my view, this case is closer to the Two-Way Media decision of the Federal Circuit in 2017 where that Court held or found that a particular ordered combination of asserted limitations did not reveal an inventive concept because unlike in BASCOM, there, the claim used a conventional ordering of steps with conventional technology to achieve its desired results.

Thus, the Court found the claims of the asserted patents to be patent ineligible under § 101.  This case exemplifies patent-eligibly battles over lengthy claims that, despite their length, are supported by meager technical details and descriptions of improvements to computer technology.

Pebble Tide LLC v. Arlo Technologies, Inc. (D. Del. 2020)
Memorandum Order by District Judge Stark

CareDX, Inc. v. Natera, Inc. (D. Del. 2020)

By Kevin E. Noonan --

Ever since the Supreme Court's decision in Mayo Collaborative Services v. Prometheus Laboratories was handed down in 2012, diagnostic method claims have been routinely invalidated by the district courts and those decisions upheld by the Federal Circuit.  Indeed, in her recent dissent of the Court's denial of patentee's petition for rehearing en banc in Athena Diagnostics v. Mayo Collaborative Services, Judge Newman enumerated the six (now, seven including Athena) Federal Circuit decisions holding diagnostic method claims to be patent ineligible under Section 101.  In her dissent in Athena, Judge O'Malley noted that:

Since Mayo, every diagnostic claim to come before this court has been held ineligible.  While we believe that such claims should be eligible for patent protection, the majority of this court has definitively concluded that the Supreme Court prevents us from so holding.  No need to waste resources with additional en banc requests.  Your only hope lies with the Supreme Court or Congress.  I hope that they recognize the importance of these technologies, the benefits to society, and the market incentives for American business.  And, oh yes, that the statute clearly permits the eligibility of such inventions and that no judicially-created exception should have such a vast embrace.  It is neither a good idea, nor warranted by the statute.  I dissent.

A bleak prospect, to say the least.

But as Justice Breyer mentioned in Mayo, the Supreme Court's eligibility precedent has cautioned "against 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 Parker v. Flook, 437 U. S. 584, 593 (1978).  And yet, experience has shown time and again that adapting to the Court's shifting precedents requires competent draftsmen to use their experience and skill as draftsmen to capture for inventors claims to provide protection against expropriation by infringers.  See, e.g., Vanda Pharmaceuticals Inc. v. West-Ward Pharmaceuticals.

The latest example of creative drafting (including how the invention was described in the specification) is a recent decision (Report and Recommendation [to the District Court judge]), by Magistrate Judge Christopher J. Burke in the District of Delaware, who denied defendant's Rule 12(b)(6) motion (of ineligibility) in CareDX, Inc. v. Natera, Inc.  The case arose over the claims in U.S. Patent Application Nos. 8,703,652 and 9,845,497, directed to "methods to help predict the status or outcomes of transplant recipients through sequencing of cell-free nucleic acids ("cfDNA") found in the bodily fluids of a recipient." The rationale behind the invention is rejection of a transplanted organ in a recipient is accompanied by cell death, which releases donor-specific DNA into the recipient's bodily fluids.  Claim 1 of the '652 patent and claim 1 of the '497 patents are representative:

The '652 patent claim 1:

1.  A method for detecting transplant rejection, graft dysfunction, or organ failure, the method comprising:
    (a) providing a sample comprising cell-free nucleic acids from a subject who has received a transplant from a donor;
    (b) obtaining a genotype of donor-specific polymorphisms or a genotype of subject-specific polymorphisms, or obtaining both a genotype of donor-specific polymorphisms and subject-specific polymorphisms, to establish a polymorphism profile for detecting donor cell-free nucleic acids, wherein at least one single nucleotide polymorphism (SNP) is homozygous for the subject if the genotype comprises subject-specific polymorphisms comprising SNPs;
    (c) multiplex sequencing of the cell-free nucleic acids in the sample followed by analysis of the sequencing results using the polymorphism profile to detect donor cell-free nucleic acids and subject cell-free nucleic acids; and
    (d) diagnosing, predicting, or monitoring a transplant status or outcome of the subject who has received the transplant by determining a quantity of the donor cell-free nucleic acids based on the detection of the donor cell-free nucleic acids and subject cell-free nucleic acids by the multiplexed sequencing,
    wherein an increase in the quantity of the donor cell-free nucleic acids over time is indicative of transplant rejection, graft dysfunction or organ failure, and wherein sensitivity of the method is greater than 56% compared to sensitivity of current surveillance methods for cardiac allograft vasculopathy (CAV).

The '497 patent claim 1:

1.  A method of detecting donor-specific circulating cell-free nucleic acids in a solid organ transplant recipient, the method comprising:
    (a) genotyping a solid organ transplant donor to obtain a single nucleotide polymorphism (SNP) profile of the solid organ transplant donor;
    (b) genotyping a solid organ transplant recipient to obtain a SNP profile of the solid organ transplant recipient, wherein the solid organ transplant recipient is selected from the group consisting of: a kidney transplant, a heart transplant, a liver transplant, a pancreas transplant, a lung transplant, a skin transplant, and any combination thereof;
    (c) obtaining a biological sample from the solid organ transplant recipient after the solid organ transplant recipient has received the solid organ transplant from the solid organ transplant donor, wherein the biological sample is selected from the group consisting of blood, serum and plasma, and wherein the biological sample comprises circulating cell-free nucleic acids from the solid organ transplant; and
    (d) determining an amount of donor-specific circulating cell-free nucleic acids from the solid organ transplant in the biological sample by detecting a homozygous or a heterozygous SNP within the donor-specific circulating cell-free nucleic acids from the solid organ transplant in at least one assay,
    wherein the at least one assay comprises high-throughput sequencing or digital polymerase chain reaction (dPCR), and
    wherein the at least one assay detects the donor-specific circulating cell-free nucleic acids from the solid organ transplant when the donor-specific circulating cell-free nucleic acids make up at least 0.03% of the total circulating cell-free nucleic acids in the biological sample.

The Magistrate Judge resolved the issue of whether these claims were ineligible for patenting under 35 U.S.C. § 101 under the first step of the Supreme Court's test enunciated in Mayo and Alice Corp. v. CLS Bank Int'l.  Defendants argued (as they must) that the claims in the patents-in-suit were directed to one of the judicial exceptions (a natural phenomenon, specifically "the correlation between transplant rejection and the presence of naturally occurring [cfDNA] in the bodily fluids of transplant recipients").  The Magistrate, relying on Federal Circuit precedent permitting a court to consider the patent specification in determining "what a patent claim is really directed to at step one [of the Mayo/Alice test]" (Enfish LLC v. Microsoft Corp.) found that:

"[T]he patents' [related] specification repeatedly and consistently states that this basic 'correlation' between the presence of increased levels of donor-specific cfDNA and transplant rejection . . . – i.e., the thing that, according to Defendants, the asserted claims were purportedly 'directed to' – had already been well-known in the art for quite a long time.

The Magistrate's findings further explicated disclosure in the specification related to prior art efforts to use distinguishing markers from donor DNA (Y chromosome sequences from male donors in female recipient, or HLA antigens that differed between donors and recipients) and how those efforts had failed.

The Magistrate then raised this rhetorical question:  "How could it be the case that the 'basic thrust or 'character as a whole' or 'focus' of the purportedly representative claims of the patents is to a naturally-occurring correlation, when the patentee repeatedly states that this very correlation was already well-known in the art?  To ask the question is to answer it," according to the Magistrate, further stating "[i]t does not, in fact, make a lot of sense to think that the claims are directed to something the patent repeatedly says the claims are not directed to."  Relying further on the specification, the Magistrate credits the patentee for "tell[ing] us that what it thinks was really invented here . . . is something other than the correlation itself":

[T]he invention provides a universal approach to noninvasive detection of graft rejection in transplant patients which circumvents the potential problems of microchimerism from DNA from other foreign sources and is general for all organ recipients without consideration of gender.  In some embodiments, a genetic fingerprint is generated for the donor organ.  This approach allows for a reliable identification of sequences arising solely from the organ transplantation that can be made in a manner that is independent of the genders of donor and recipient.

The Magistrate concludes from his analysis that "what the inventors were focused on here was how to develop a new, more accurate and useful analytic method of determining whether significant amounts of cfDNA were present in a transplant recipient's body(so that one could then make use of the known correlation between that fact and indication of transplant rejection)" (emphasis in Report).

The Magistrate does not rely solely on these distinctions, however.  The Report goes on to identify the language in the claims reciting detection methods that are not "routine, conventional, and well-understood":  specifically, digital PC/high-throughout sequencing/ multiplex sequencing methods.  (In footnote 8, the Magistrate states that "the key point here for purposes of Alice's step one is that the claims appear to be 'directed to' these particular methods for detecting – and not to the fact or existence of the natural phenomenon itself" (emphasis in Report)).

Accordingly, the Magistrate concludes that Defendants failed to meet their burden and recommends that the District Court judge deny the motion; tellingly, the Magistrate cites the Federal Circuit's Rapid Litig. Mgmt. Ltd. v CellzDirect Inc. decision in supporting the distinctions he relied upon here in making his Recommendation.

As refreshing as this opinion is, the reality is that it is a Report and Recommendation and thus one that the District Court judge may not follow (and Defendants are sure to make a case that the Judge should not follow it).  The Magistrate Judge's description of how the draftsman disclosed the invention is reminiscent of the philosophy employed by judo practitioners, who use an opponent's mass and momentum to gain an advantage.  By acknowledging the conventionality of the natural phenomenon underlying the invention, the issue of what the claims were "directed to" under the Mayo/Alice analytical framework could be decided in their favor.  This is important, because the test is to be applied sequentially:  if a defendant cannot satisfy the first, "directed to" prong, a court should not have the occasion to address the second prong relating to whether the recited detection method(s) were "routine, conventional, and well-understood."  This approach also has the benefit of "grasping the nettle" of the tendency to blend other, prior art-related sections of the patent statute, thereby vitiating their effectiveness of blurring the statutory distinctions into a rhetorical mess.  It cannot be said that this approach is a universal one, but it illustrates the wisdom of never acquiescing to the current state of patent eligibility jurisprudence so long as artful drafting (specification and claims) can permit a patentee to prevail.

CareDX, Inc. v. Natera, Inc. (D. Del. 2020)
Report and Recommendation by Magistrate Judge Burke

The Zombie Apocalypse of Patent Eligibility Reform and a Possible Escape Route

By Michael Borella --

The hopes of anyone in favor of patent reform targeting 35 U.S.C § 101 have been official dashed -- or at least put on hold.  In an interview with the Intellectual Property Owner's association (IPO) last week, Senator Thom Tillis (at right), Chair of the Senate's Subcommittee on Intellectual Property, indicated that the body would not be completing its work on legislatively addressing patent eligibility.

Tillis stated that "[g]iven the reasonable concerns that have been expressed about the draft as well as the practical realities of the difficulty of passing legislation, absent stakeholder consensus I don't see a path forward for producing a bill—much less steering it to passage—in this Congress."  He suggested that the Subcommittee is not against reform, but that it needs to be provided with a clearer plan for next steps.  He would "encourage all stakeholders to work with Senator Coons and [him] to develop a consensus driven approach."  Indeed, it seems as if such an approach is a requirement for entry.  "If we're going to get anything done on this issue, everyone will have to compromise," he said.  "Anything less than that is dead on arrival."

This is in stark contrast to a joint statement released last year by Senators Tillis and Coons.  Just a few months ago, they wrote that "the U.S. patent system with regard to patent eligibility is broken and desperately needs to be repaired," and "[w]e feel confident that, working together, we can ensure that the United States patent system reclaims its reputation as the gold standard for promoting innovation."

But soon after this statement made the rounds, rumblings began about § 101 reform not happening.  Conspiratorial theories suggested that lobbyists from powerful and deep-pocketed parties had convinced the senators that it would not be in their best interests to continue their efforts.  But Senator Tillis chalks up the difficulties to disagreement and stubborness amongst the stakeholders.

Thus, patent legislation seems to be off the table for 2020.  The Subcommittee plans to look into other matters, such as copyright and counterfeiting.  This leaves us with eligibility reform in an undead state -- ostensibly alive but not currently breathing.

Despite members of all three branches of government acknowledging that § 101 is a significant problem as currently interpreted, two of those branches are not planning on addressing the issue further, and the third is trying but lacks the authority to make the substantial changes needed.

In January, the Supreme Court denied certiorari on eight § 101 petitions (five two weeks ago and three more last week), including several that were well-situated for appeal.  It seems clear that the Court is happy to let patent eligibility percolate in the Federal Circuit and district courts a while longer.

The U.S. Patent and Trademark Office (USPTO) has finally acknowledged the § 101 dilemma under Director Andrei Iancu, and it rolled out new patent eligibility guidance a little over a year ago.  But even after a recent update, problems remain, and the USPTO's efforts are the application of a band-aid on a patient needing surgery.  Moreover, fixing the § 101 quagmire should be the job of the courts (realizing that they made a mistake and that the blast radius of Alice v. CLS Bank and its progeny is much wider than is reasonable and continues to grow) or Congress (legislative overruling that line of cases).  But neither have stepped up.

At the core of the dispute is policy.  Do we want a broad and extensive patent law that encompasses software and business method inventions that largely process information, should these types of innovations be excluded from patenting, or is there a happy middle ground?

Ultimately, patent eligibility is a binary decision -- a claim is valid under § 101 or it is not.  On one side are stakeholders that believe the current interpretation of § 101 is so unworkably vague that it fails its public notice function; that is, from reading the statutes and case law, even a reasonably well-educated individual cannot determine whether certain types of inventions fall within the eligible or the ineligible bucket.  On the other side are those who consider the law to be just about right because it allows rapid dismissal of potentially specious infringement lawsuits.

Part of the problem with trying to find a compromise position between these two camps (arguably there are more than two camps, but the majority of patent professionals, patentees, and technologists will fall in one or the other) is that they each see § 101 as having a different purpose.  The pro-reform contingent views the statute as only defining what inventions and discoveries are or are not eligible for patenting, thus providing direction for applicants seeking to make difficult technological and financial investment decisions.  The anti-reform group views it as a tool to avoid costly litigation.

Both viewpoints have merit.  The reason for the clash, however, speaks to the ambiguity of the standard.  Applicants just don't know what might or might not be eligible with any degree of certainty, so they file and prosecute patent applications in the expected manner -- flirting around the edges of eligibility.  This results in the USPTO issuing some of these applications as patents, a few of which will be asserted.  The accused infringer, of course, usually wants to get out of court as quickly as possible, and is therefore motivated to contend that these patents are ineligible.  In this way, the interests have become tied together.  But this does not have to be the case.

A possible solution that addresses both concerns can be based on the following observation:  many if not most patent eligibility invalidations are based on the claims being broad, vague, or reciting elements well-known in the prior art.  In other words, § 101 has become a less sophisticated way of applying a conclusory §§ 102, 103, or 112 analysis.

If you accept that this is the case (and it is -- just look to ChargePoint v. SemaConnect, The Chamberlain Group v. Techtronic Industries, and American Axle v. Neapco Holdings) then here is a modest proposal:  (i) let § 101 reform happen, abrogating Alice, Mayo v. Prometheus, and essentially all § 101 jurisprudence since the 1952 Patent Act, so that there are no more ill-defined judicial exceptions, and (ii) allow rapid, limited-scope, pre-discovery motions for claim invalidity in district courts.

The first part of the proposal addresses the "what is eligible?" question by taking us back to a more cogent and predictable regime elucidated in Diamond v. Chakrabarty -- eligible inventions are "anything under the sun that is made by man."  The confusion and debate over § 101 will largely be a thing of the past, and we only need consider whether the claims are to a process, machine, article of manufacture, or composition of matter.

The second part tackles the situation where a plaintiff aggressively asserts a questionably-issued patent.  The reason for pushing this concern out of § 101 is based on the observation that most claims invalidated under § 101 are likely to be subject to prior art, enablement, or written description challenges (see the interpretation of Alice prong two in Berkheimer v. HP and Judge Moore's dissent in American Axle, for example).  Those not as vulnerable to non-§ 101 issues almost invariable should have been found eligible (see Ultramercial v. Hulu and most diagnostic method and graphical interface patents, for example).

A district court judge would have discretion allow these rapid, limited-scope, pre-discovery motions for invalidity under §§ 102, 103, and/or 112.  The defendant would be given one shot at any of these motions.  For prior-art-based contentions, the defendant gets to use only one reference or one combination of references, so long as the motivation to combine is straightforward and clear.  For written description or enablement contentions, the defendant gets one argument.  The level of skill in the art would need to be apparent on the record or otherwise clearly understood.

Since those in favor of the current murky state of § 101 often claim that there are many so-called "bad patents" that are clearly invalid, they get to put their money where their mouth is.  If a patent so clearly subject to invalidity, it should be almost trivial to find the prior art or make the § 112 arguments.

Of course, the contours of these motions would have to be fleshed out by the presiding judge on a case by case basis.  But if these non-§ 101, limited-scope invalidity contentions cannot be made, then the case should not be dismissed on the pleadings.

In sum, this proposal is an attempt to reduce and hopefully eliminate the practice under Alice of taking patent rights away from inventors and patentees based on conclusory reasoning and an incomplete view of what has been invented.

Perhaps Senator Tillis believes that Congress cannot act on § 101 reform because a proposed solution like this one may go beyond the scope of what Congress can legislate.  Courts have control over their dockets and it would likely be unconstitutional for the legislative branch to start telling district court judges how to manage their caseload.

In that case, maybe § 101 reform failed because it cannot succeed in its current form.  There very well may be no legislative compromise solution that makes all stakeholders in the patent-eligibility debate ready to sign on.  Instead, a more holistic approach requires a certain degree of effort and cooperation from all branches of government.  The USPTO needs to reduce the number of low-quality patents that it issues, while simultaneously not holding up high-quality inventions for years in prosecution.  Congress needs to return § 101 to its basics.  The courts need to refrain from killing off patents based on overgeneralizations and unfounded presumptions, while also allowing low-quality patents that slip through the USPTO to be invalidated without putting an undue burden on defendants.

Hopefully, all of the above would not end up being the patent law equivalent of pushing Jello uphill.

iLife Technologies, Inc. v. Nintendo of America, Inc. (N.D. Tex. 2020)

By Michael Borella --

With the eligibility rubric of Alice v. CLS Bank, an applicant/patentee must navigate a minefield of pre-issuance and post-issuance validity challenges under 35 U.S.C. § 101 in order to obtain and enforce a patent.

First, through clever drafting, the applicant must convince a U.S. Patent and Trademark Office (USPTO) examiner to not raise a § 101 rejection during prosecution.  If one is raised, the applicant has to persuade the examiner, through amendment or argument, to withdraw it.  If the examiner remains unpersuaded, an appeal to the USPTO's Patent Trial and Appeal Board (PTAB) must serve that function.  Failing that, appeals to the Federal Circuit (which applies a highly-unpredictable eligibility analysis) and even the Supreme Court (which has not found a patent eligible since 1981) are possible.  To be fair, it is unlikely that the high Court will grant certiorari on a § 101 issue these days, as we have recently seen.

Once issued, the patent might be able to be pulled back into the PTAB for a Post-Grant Review (PGR) or a Covered Business Method (CBM) Review.  In addition to that, enforcement proceedings in a district court can subject the patent to further invalidity challenges under § 101 on the pleadings and at summary judgment.  If the district court's § 101 decision is appealed, the patent then has to survive said eligibility analysis of the Federal Circuit, the decision of which could potentially be further appealed to the Supreme Court with said unlikely chance of being heard.

Only once these avenues have been exhausted can the patentee relax and use the surviving patent to enjoin a party from practicing the claimed invention or to seek damages therefrom without the specter of § 101 hanging over the proceedings (this specter is one of stock horror-movie fare -- pale complexion, chunks of missing flesh, sharp claws -- quite non-abstract, if you will).  And yes, the patent also has to be found novel, non-obvious, properly specified, and infringed.

Clearly, an entity seeking an enforceable patent to protect its innovations from copyists and free-riders has a few hurdles to overcome.  Perhaps this would not be a terrible conundrum if the law surrounding patent eligibility was clear.  But it is not.  Don't take my word for it -- read what others more knowledgeable and eloquent have written.

In any event, iLife sued Nintendo in the Northern District of Texas for allegedly infringing U.S. Patent No. 6,864,796.  At issue were the latter's Wii and Wii U motion control wands known as "Wiimotes".

As described by the Court:

The '796 patent generally discloses a system for evaluating body movement relative to an environment.  The system includes a sensor that detects dynamic and static accelerative phenomena of the body.  The sensor senses one or more absolute values, changes in value, or some combination of the same and generates an output signal to [a] processor.  The processor then evaluates the signal to determine whether the body is in an acceptable or unacceptable state.  The patent describes acceptable or unacceptable as within or beyond tolerance.

Regarding the patent, claim 1 was front and center in the accusation of infringment.  It recites:

A system within a communications device capable of evaluating movement of a body relative to an environment, said system comprising:
    a sensor, associable with said body, that senses dynamic and static accelerative phenomena of said body, and
    a processor, associated with said sensor, that processes said sensed dynamic and static accelerative phenomena as a function of at least one accelerative event characteristic to thereby determine whether said evaluated body movement is within environmental tolerance
    wherein said processor generates tolerance indicia in response to said determination; and
    wherein said communication device transmits said tolerance indicia.

The case went to trial and the jury found that Nintendo infringed claim 1, awarding iLife slightly over $10 million in damages.  The jury also found the patent to be not invalid on grounds of purportedly lacking adequate written description and enablement.

Nintendo moved for a judgment as a matter of law, arguing that claim 1 is invalid under § 101, indefinite, and lacks adequate written description and enablement.  We will focus on the eligibility dispute.

In Alice, the Supreme Court set forth a two-part test to determine whether claims are directed to patent-eligible subject matter under § 101.  One must first decide whether the claim at hand involves a judicially-excluded law of nature, a natural phenomenon, or an abstract idea.  If so, then one must further decide whether any element or combination of elements in the claim is sufficient to ensure that the claim amounts to significantly more than the judicial exclusion.  But elements or combinations of elements that are well-understood, routine, and conventional will not lift the claim over the § 101 hurdle.  While this inquiry is generally carried out as a matter of law, factual issues can come into play when determining whether something is well-understood, routine, and conventional.

Applying part one of Alice, the Court found that, not unlike the Federal Circuit decision of Electric Power Group v. Alstom S.A., claim 1 was "directed to the abstract idea of gathering, processing, and transmitting . . . information."  Further, the type of information at play -- dynamic and static accelerative phenomena -- did not render the claim any less abstract.  The Court also noted that "[n]othing in claim 1, understood in light of the specification, requires anything other than conventional sensors and processors performing conventional activities previously known to the industry."  Indeed, the Court cited to such an admission in the specification.

The Court also considered whether the claim involved an improvement to its recited hardware.  Ultimately, the Court concluded that it did not, finding that "the claim does not disclose any improvement in the sensor's ability to collect information, such as collecting previously unknown information or collecting information more accurately [and] it does not disclose some improvement in the processor itself, such as faster or more powerful processing."  Further, the claim "is not limited to any particular configuration of the components that results in a technological improvement . . . [i]nstead, the sensor and processor are merely tools to execute an abstract idea."

Finding claim 1 abstract, the Court moved on to part two of Alice.  Unsurprisingly, the claim fared poorly, with the Court rapidly concluding that "[t]here is no inventive concept in the claim elements, whether considered individually or as an ordered combination . . . [and it] does not add any meaningful limitations to the routine steps of data collection, analysis, and transmission using conventional computer components."

Particularly, "[c]laim 1 requires neither a new source or type of information nor a new method of measuring information [and] provides for an unspecified set of rules for analyzing sensor data, but discloses no further details on those rules, like how data might be evaluated for a child versus an adult."  The Court even used iLife's own claim construction argument that claim 1 "does not contain words requiring any special type of processing" against it.

iLife argued that, in its specification, "the claimed processor distinguishes between normal and abnormal accelerative events, and, when an abnormal event is identified, to indicate whether the abnormal event is tolerable, or within tolerance" as well as distinguishing "other physical characteristics, including temperature, pressure, force, sound, light, relative position, and the like."  But the Court observed that the claim itself does not contain these details or limitations, and therefore does not satisfy part two of the test.

Consequently, the Court ruled the '796 patent invalid under § 101 as a matter of law, effectively rendering the jury verdict moot.

For anyone following § 101 jurisprudence, a quick glance at claim 1 was probably enough to provide an educated guess for which way the Court was going to rule.  Recent § 101 opinions from the Federal Circuit have repeated found that claims lacking in technical detail -- ones that recite what an invention does rather than how the invention accomplishes its goals -- are generally abstract.  This is not the dictionary definition of the word "abstract," but instead a legal fiction that a concrete and tangible invention can be invalid if it is defined in terms of its outcome rather than the process used to achieve that outcome.

Despite there being no inkling of this notion in § 101 of the patent statute and questionable support in the Supreme Court's cases, the post-Alice Federal Circuit has morphed patent-eligibility into a game in which one must guess the level of detail required for an invention to cross over from "abstract" to "non-abstract."  If anything, such considerations are best addressed under §§ 102, 103, and 112 -- the parts of the statute where over-broad claim language can be considered in a more cogent fashion.  But with the Alice hammer all claims look like nails, so here we are.  And the § 101 minefield becomes even more hazardous.

iLife Technologies, Inc. v. Nintendo of America, Inc. (N.D. Tex. 2020)
Order by Chief Judge Lynn

U.S. Supreme Court on Eligibility: Nothing to See Here, Move Along

By Kevin E. Noonan --

The Supreme Court today entered orders denying certiorari in all five cases having petitions on subject matter eligibility, including Athena Diagnostics, Inc. v. Mayo Collaborative Services, LLC; Hikma Pharmaceuticals USA Inc. v. Vanda Pharmaceuticals Inc., and Berkheimer v. HP Inc.

It can only be concluded that the Court is comfortable with the state of diagnostic method patenting (i.e., it does not exist in the U.S.).  There are members of the Court who have expressed skepticism or outright hostility to such claims, fearing that they will inhibit the practice of medicine, as well as statements (some of dubious provenance) that diagnostic methods are unlike pharmaceuticals and don't need patents (mostly from legal academics and economists).  Although Bilski was a business method patent case, some of the Justices there seemed unimpressed with method claims more generally, and this prejudice may be affecting their certiorari behavior.  And there is the animus many of the Justices have voiced about the Federal Circuit over the past 15-20 years, which may have made the Court less inclined to come to their rescue.

Or maybe the Court believes that this decision (not to decide) will motivate Congress to change the law; after all, in Mayo, Justice Breyer said something along the lines of "if you disagree with us, go to Congress."  And genuinely, the Court may be facing up to the reality that, even if its concerns are real, the Justices don't have a solution to the problem, in which case Congress is the only answer.

What needs to be done (although it won't be) is for the PTO and courts to distinguish in individual cases the application of the Mayo/Alice cases to come to a determination of patent eligibility.  The Court can speak in generalities all it wants, but if pressed by advocates who point out the economic consequences of the recent jurisprudence there is a chance the Court will moderate its views.  After all, the Court certainly does not want the business section of the Wall Street Journal to run the headline "Supreme Court Destroys U.S. Industry, Public at Risk, Healthcare Costs Sure to Rise."

On the bright side, by denying cert. in Vanda, the Court kept alive the glimmer of hope that there is a way to draft enforceable claims related to diagnostics leading to real world therapeutic interventions, as well as in Berkheimer, which increases the burden on patent challengers and may inhibit plenary dismissal on eligibility grounds.

And in view of the Court's denial of certiorari in Regents of the University of Minnesota v. LSI Corp., maybe the Court believes that the other petitioners have more compelling interests in the Court's disposition of their cases than patentees have.  This sentiment would not be inconsistent with the Court's views on patent law enunciated in many cases over the past decade.

Top Five Stories of 2019

By Donald Zuhn –-

After reflecting upon the events of the past twelve months, Patent Docs presents its 13th annual list of top patent stories.  For 2019, we identified fifteen stories that were covered on Patent Docs last year that we believe had (or are likely to have) a significant impact on patent practitioners and applicants.  In previous posts, we counted down stories #15 to #11 and stories #10 to #6, and today we count down the top five stories of 2019.  As with our other lists (2018, 2017, 2016, 2015, 2014, 2013, 2012, 2011, 2010, 2009, 2008, and 2007), links to our coverage of these stories (as well as a few links to articles on related topics) have been provided in case you missed the articles the first time around or wish to go back and have another look.  As always, we love to hear from Patent Docs readers, so if you think we left something off the list or disagree with anything we included, please let us know.  In addition, we will be offering a live webinar on the "Top Patent Law Stories of 2019" on January 22, 2020 from 10:00 am to 11:15 am (CT).  Details regarding the webinar, which will focus on a handful of the most important stories on this year's list, can be found here.

5.  USPTO Updates Subject Matter Eligibility Guidance (Not Once, But Twice)

In January, the U.S. Patent and Trademark Office published updated examination guidance regarding the subject matter eligibility of inventions involving abstract ideas.  At first blush, the updated guidance does not appear to be a radical departure from substantive USPTO examination practice despite raising a few additional procedural hurdles that examiners are to overcome before rejecting claims under 35 U.S.C. § 101.  In October, the USPTO released an update to its January 2019 Subject Matter Eligibility Guidance, in which the Office sought to clarify issues brought up in public comments on the January Guidance.  The patent community will have to wait and see how the new guidance plays out in practice.  If anything, the additional procedural requirements introduced and the limiting of abstract ideas to only three categories is likely to favor applicants for at least some types of inventions.  It is unlikely, however, that any claims that could be found patent-eligible under previous examination procedures are suddenly going to be viewed as ineligible under the new guidance.

For information regarding this and other related topics, please see:

• "USPTO Subject Matter Eligibility October Update: Example 46," November 17, 2019
• "USPTO Publishes Update to Its Subject Matter Eligibility Guidance," October 17, 2019
• "The PTAB Goes to Europe: Four Recent Section 101 Decisions Designated as Informative," July 28, 2019
• "USPTO Presentation on Evaluating Computer-Implemented Functional Claiming under 35 U.S.C. § 112," June 18, 2019
• "USPTO on Patent Eligibility -- Examples 41 and 42," January 24, 2019
• "USPTO on Patent Eligibility -- Example 40," January 20, 2019
• "USPTO on Patent Eligibility -- Examples 38 & 39," January 15, 2019
• "USPTO on Patent Eligibility -- Example 37," January 14, 2019
• "USPTO Issues Updated Subject Matter Eligibility Guidance," January 7, 2019

4.  Post-grant Review of Pre-AIA Patents Constitutional -- USPTO Appointment of APJs at PTAB Unconstitutional

In July, the Federal Circuit in Celgene Corp. v. Peter affirmed a determination by the Patent Trial and Appeal Board (PTAB) that two patents owned by Celgene Corp. were invalid.  In rendering that decision, however, the Federal Circuit also addressed on the merits Celgene's argument that retroactive invalidation of its patents under the inter partes review (IPR) procedures introduced into U.S. patent law by the Leahy-Smith America Invents Act (AIA) is unconstitutional because its patents were granted before enactment of these IPR procedures and thus amounted to a taking under the Fifth Amendment.  The Federal Circuit based its decision that IPRs are not unconstitutional on the history, beginning in 1980, of Patent Office review of previously granted patents, which at least put patentees on notice that the Office could reconsider the validity of the patent grant.  This history made that grant contingent on there not being a successful post-grant challenge, and thus an IPR is nothing more than the latest iteration of such proceedings.

And then in October, the Federal Circuit in Arthrex, Inc. v. Smith & Nephew, Inc. determined that the way in which the U.S. Patent and Trademark Office has appointed administrative patent judges at the PTAB violates the Appointments Clause of the Constitution (Art. II, sec. 2, cl. 2).  According to the opinion, because administrative patent judges are principal officers they must be nominated by the President and confirmed by the Senate.

For information regarding this and other related topics, please see:

• "Federal Circuit Holds APJs Are Principal Officers," October 31, 2019
• "OSI Pharmaceuticals, LLC v. Apotex Inc. (Fed Cir. 2019)," October 8, 2019
• "Enzo Life Sciences, Inc. v. Becton, Dickinson and Co. (Fed. Cir. 2019)," August 21, 2019
• "Celgene Corp. v. Peter (Fed. Cir. 2019)," August 5, 2019

3.  Courts Continue to Address Question of Sovereign Immunity in Patent Cases

In April, the U.S. Supreme Court denied a petition for writ of certiorari by the St. Regis Mohawk Indian Tribe on the question (answered in the negative by the Patent Trial and Appeal Board (PTAB) of the U.S. Patent and Trademark Office and the Federal Circuit) of whether tribal sovereign immunity could protect the tribe from being named as a party in an inter partes review (IPR) proceeding after Allergan assigned to the tribe its patents in IPR.  Then in June, in Regents of the University of Minnesota v. LSI Corp., the Federal Circuit determined that State sovereign immunity does not preclude institution of IPR proceedings before the PTAB.  In September, the State of Minnesota filed a petition for certiorari, contending that the Federal Circuit erred in deciding that the University of Minnesota, as an "arm of the state," could not assert sovereign immunity against LSI Corp., which sought to have the PTAB institute an IPR against University-owned patents.  And last fall, the Federal Circuit in Board of Regents of the University of Texas System v. Boston Scientific Corp. refused to recognize the immunity as advanced by the State, in this case asserted over the question of proper venue.  Given the number of cases in which the issue of sovereign immunity in patent cases has been raised, this issue is likely to be selected again for our top stories list in 2020.

For information regarding this and other related topics, please see:

• "Board of Regents of the University of Texas System v. Boston Scientific Corp. (Fed. Cir. 2019)," September 19, 2019
• "State of Minnesota Petitions for Certiorari in Regents of University of Minnesota v. LSI Corp.," September 15, 2019
• "Regents of the University of Minnesota v. LSI Corp. (Fed. Cir. 2019)," June 16, 2019
• "Supreme Court to Revisit Abrogation of State Sovereign Immunity From IP Infringement," June 4, 2019
• "Supreme Court Denied Certiorari Writ by St. Regis Mohawk Indian Tribe in Restatis® IPR," April 15, 2019

2.  Federal Circuit Strikes Down Diagnostic Patent in Athena v. Mayo, But Cannot Find Consensus on Subject Matter Eligibility Solution

In February, in Athena Diagnostics, Inc. v. Mayo Collaborative Services, LLC, the Federal Circuit affirmed a District Court decision holding claims 6-9 of U.S. Patent No. 7,267,820 invalid under 35 U.S.C. § 101.  The '820 patent is directed to methods for diagnosing neurological disorders by detecting antibodies to a protein called muscle-specific tyrosine kinase (MuSK).  In July, the Federal Circuit issued a per curiam Order, denying a petition for rehearing en banc filed by Athena.  The per curiam Order was accompanied by eight opinions, four concurring in the denial of the petition and four dissenting in the denial of the petition.  The four concurring opinions were authored by Circuit Judges Lourie, Hughes, Dyk, and Chen, with Chief Judge Prost and Circuit Judges Reyna, Taranto, and Hughes joining in one of the concurrences and Circuit Judge Chen joining in one concurrence and several parts of another.  The four dissenting opinions were authored by Circuit Judges Moore, Newman, Stoll, and O'Malley, with Circuit Judges O'Malley and Stoll joining in one of the dissents and Circuit Judge Wallach joining in three of the dissents.  Thus, a total of seven members of the Court (Chief Judge Prost and Circuit Judges Lourie, Dyk, Reyna, Taranto, Chen, and Hughes) authored or joined opinions concurring in the denial, and a total of five members (Circuit Judges Newman, Moore, O'Malley, Wallach, and Stoll) authored or joined opinions dissenting in the denial.  The Federal Circuit had difficulty reaching a consensus on the solution to the problem of subject matter eligibility.  Some judges felt the Federal Circuit was bound by the Supreme Court's decision in Mayo, some hinted that the problem could only be solved by the Supreme Court or that the Federal Circuit would at least benefit from the Supreme Court's guidance, some thought the Federal Circuit could solve the problem by better distinguishing Mayo, and some thought Congress should step in to solve the problem.  Last fall, Athena filed a petition for a writ of certiorari in the case, requesting that the Supreme Court "provide much-needed guidance on the important question of the patent eligibility of medical diagnostic tests."  (In his brief in Hikma Pharmaceuticals USA Inc. v. Vanda Pharmaceuticals Inc., the Solicitor General suggested that the Supreme Court "should provide additional guidance in a case where the current confusion has a material effect on the outcome of the Section 101 analysis," offering as one example a case involving the patent eligibility of medical-diagnostic methods, and pointing in particular to Athena v. Mayo.)  The Supreme Court is scheduled to discuss Athena's petition at Conference on January 10, 2020.

For information regarding this and other related topics, please see:

• "Athena Diagnostics Seeks Supreme Court Review of Athena Diagnostics v. Mayo Collaborative Services," December 16, 2019
• "iNO Therapeutics LLC v. Praxair Distribution Inc. (Fed. Cir. 2019)," September 3, 2019
• "Genetic Veterinary Sciences, Inc. v. LABOKLIN GmbH (Fed. Cir. 2019)," August 22, 2019
• "Australia Reigns Supreme over U.S. in Patenting Diagnostic Methods," August 6, 2019
• "The Proper Role of the Federal Circuit," July 25, 2019
• "Athena Diagnostics v. Mayo Collaborative Services -- The Dissents," July 17, 2019
• "Athena Diagnostics v. Mayo Collaborative Services -- The Concurrences," July 14, 2019
• "Athena Diagnostics, Inc. v. Mayo Collaborative Services, LLC (Fed. Cir. 2019)," July 9, 2019
• "Invitation to Join Amicus Brief in Athena Diagnostics v. Mayo," April 11, 2019
• "Cleveland Clinic Foundation v. True Health Diagnostics LLC (Fed. Cir. 2019)," April 7, 2019
• "Athena Diagnostics, Inc. v. Mayo Collaborative Services, LLC (Fed. Cir. 2019)," February 12, 2019

1.  Supreme Court: Secret Sales Trigger On-sale Bar under AIA

In January, the Supreme Court addressed the question of whether Congress intended to change the status of "secret" sales so as not to trigger the on-sale bar of revised 35 U.S.C. § 102 of the Leahy-Smith America Invents Act (AIA) by adding the phrase "or otherwise known to the public."  The Federal Circuit had held that Congress had not done so, and the Supreme Court agreed.  The Court's decision, authored by Justice Thomas, was short (9 pages), unanimous (9-0), and issued quickly (handed down less than seven weeks after oral argument).  The Court recognized that it had "never addressed the precise question presented in this case," but voiced its opinion that "our precedents suggest that a sale or offer of sale need not make an invention available to the public."  The Court based its decision on the well-established principle that, under prior versions of § 102, "secret sales" could trigger the on-sale bar.  These cases were as recent as Pfaff v. Wells Electronics, Inc., 525 U.S. 55 (1998), and as ancient as a trio of 19th Century cases (Consolidated Fruit-Jar Co. v. Wright, 94 U.S. 92 (1877); Smith & Griggs Mfg. Co. v. Sprague, 123 U.S. 249 (1887); Elizabeth v. Pavement Co., 97 U.S. 126 (1878)).  The opinion credits the Federal Circuit with making "explicit what was implicit in our precedent" with regard to the on-sale bar, citing Special Devices, Inc. v. OEA, Inc., 270 F. 3d 1353 (2001), and Woodland Trust v. Flowertree Nursery, Inc., 148 F. 3d 1368 (1998), in support of its conclusion.  Based on this various precedent, the Court was able to reach the conclusion that Congress did not change what activities raised the on-sale bar, which includes secret sales, because there was insufficient evident of that intent.  The Court relied expressly on the Solicitor General's argument that "if 'on sale' had a settled meaning before the AIA was adopted, then adding the phrase 'or otherwise available to the public' to the statute 'would be a fairly oblique way of attempting to overturn' that 'settled body of law.'"  The Court pointed out that the catch-all phrase "otherwise available to the public" is better interpreted to capture "material that does not fit neatly into the statute's enumerated categories but is nevertheless meant to be covered."

For information regarding this and other related topics, please see:

• "Helsinn Healthcare S. A. v. Teva Pharmaceuticals USA, Inc. (2019)," January 22, 2019

Top Stories of 2019: #6 to #10

By Donald Zuhn –-

After reflecting upon the events of the past twelve months, Patent Docs presents its 13th annual list of top patent stories.  For 2019, we identified fifteen stories that were covered on Patent Docs last year that we believe had (or are likely to have) a significant impact on patent practitioners and applicants.  Yesterday, we counted down stories #15 to #11, and today, we count down stories #10 to #6, as we will work our way towards the top five stories of 2019.  As with our other lists (2018, 2017, 2016, 2015, 2014, 2013, 2012, 2011, 2010, 2009, 2008, and 2007), links to our coverage of these stories (as well as a few links to articles on related topics) have been provided in case you missed the articles the first time around or wish to go back and have another look.  As always, we love to hear from Patent Docs readers, so if you think we left something off the list or disagree with anything we included, please let us know.  In addition, we will be offering a live webinar on the "Top Patent Law Stories of 2019" on January 22, 2020 from 10:00 am to 11:15 am (CT).  Details regarding the webinar, which will focus on a handful of the most important stories on this year's list, can be found here.

10.  Federal Circuit Applies Doctrine of Equivalents (And Not Only in "Exceptional" Cases)

In May, the Federal Circuit dismissed Amgen's doctrine of equivalents argument in Amgen Inc. v. Sandoz Inc., stating that "[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 v. Hilton Davis Chemical Co. precedent in London v. Carson Pirie Scott & Co., 946 F.2d 1534, 1538 (Fed. Cir. 1991).  The Court based its decision on the 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.  Four months later, the Federal Circuit issued an order modifying its opinion to read:  "The 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.'"  In between its May decision and September order in Amgen, the Federal Circuit issued at least five decisions applying the doctrine of equivalents (and issued a sixth decision applying the doctrine in November).

The doctrine of equivalents is a Supreme Court-created patent doctrine that arose in Graver Tank & Mfg. Co. v. Linde Air Products Co., 339 U.S. 605 (1950) (an uncharacteristically pro-patent decision by the Court, the doctrine recognized that an "unscrupulous copyist" could practice a claimed invention without literal infringement in some circumstances, and as a consequence the patent right could be turned into a "hollow and useless thing").  The doctrine fell into disfavor at the Federal Circuit during the 1990's and arguably provided the first inkling to the Supreme Court that the Federal Circuit's patent jurisprudence would benefit from the Court's closer oversight.  In Warner-Jenkinson Co. v. Hilton Davis Chem. Co. and Festo v. Shoketsu Kinzoku Kogyo Kabushiki, the Supreme Court reiterated the vibrancy of the doctrine; nevertheless, its successful assertion has continued to decline.  Thus, the Federal Circuit's decision in UCB, Inc. v. Watson Laboratories Inc. in June, affirming a District Court's determination in ANDA litigation that the generic challenger's product infringed under the doctrine, was a welcome surprise.

For information regarding this and other related topics, please see:

• "Pharma Tech Solutions, Inc. v. Lifescan, Inc. (Fed. Cir. 2019)," November 27, 2019
• "Federal Circuit Issues Order Clarifying Status of Doctrine of Equivalents," September 5, 2019
• "Ajinomoto Co. v. International Trade Commission (Fed. Cir. 2019)," August 13, 2019
• "Eli Lilly & Co. v. Hospira, Inc. (Fed. Cir. 2019)," August 12, 2019
• "Amgen Inc. v. Coherus BioSciences Inc. (Fed. Cir. 2019)," August 11, 2019
• "Indivior Inc. v. Dr. Reddy's Laboratories, S.A. (Fed. Cir. 2019)," July 24, 2019
• "UCB, Inc. v. Watson Laboratories Inc. (Fed. Cir. 2019)," July 16, 2019
• "Amgen Inc. v. Sandoz Inc. (Fed. Cir. 2019)," May 12, 2019

9.  Federal Circuit Finds More Method of Treatment Patents Eligible

Following on the heels of its 2018 decision in Vanda Pharmaceuticals Inc. v. West-Ward Pharmaceuticals Int'l, the Federal Circuit issued two more decisions concerning the patent eligibility of method of treatment claims in 2019.  In Vanda, which made our Top Stories list last year (coming in at #12), the Federal Circuit affirmed a District Court decision finding that the claims of U.S. Patent No. 8,586,610, which are directed to methods of treating a patient suffering from schizophrenia with iloperidone, were not invalid under 35 U.S.C. § 101.  In April, the Federal Circuit decided Endo Pharmaceuticals Inc. v. Teva Pharmaceuticals USA, Inc., reversing a District Court decision holding the claims of U.S. Patent No. 8,808,737, which are directed to methods of using oxymorphone to treat pain in patients with impaired kidney function, to be ineligible under 35 U.S.C. § 101.  In reversing the District Court, the Federal Circuit determined that the asserted claims of the '737 patent were legally indistinguishable from the claims at issue in Vanda.  Only a few weeks earlier, the Federal Circuit decided Natural Alternatives International, Inc. v. Creative Compounds, LLC, reversing and remanding a District Court decision granting a motion for judgment on the pleadings that the asserted claims of six patents, which relate to the use of beta-alanine in dietary supplements to increase the anaerobic working capacity of muscle and other tissue, were not patent eligible.  The United States closed 2019 by filing a brief in response to a Supreme Court order inviting the Solicitor General to express the views of the United States on the petition for certiorari filed by Petitioners Hikma Pharmaceuticals USA Inc. and Hikma Pharmaceuticals International Ltd. (previously West-Ward Pharmaceuticals International Ltd.) in Hikma Pharmaceuticals USA Inc. v. Vanda Pharmaceuticals Inc.  The Solicitor General concluded that Vanda "is not an optimal vehicle for bringing greater clarity because the court of appeals majority arrived at the correct result," noting that "[i]n cases involving medical-diagnostic methods, by contrast, the Federal Circuit's recent decisions suggest that the court might well have reached different outcomes if it were not bound by the Mayo framework."  The Solicitor General therefore recommended that "[t]he Court should await a case in which lower courts' confusion about the proper application of Section 101 and this Court's precedents makes a practical difference."  The Supreme Court is scheduled to discuss Hikma's petition at Conference on January 10, 2020.

For information regarding this and other related topics, please see:

• "Solicitor General Recommends That Supreme Court Deny Certiorari in Hikma Pharmaceuticals v. Vanda Pharmaceuticals," December 8, 2019
• "Endo Pharmaceuticals Inc. v. Teva Pharmaceuticals USA, Inc. (Fed. Cir. 2019)," April 1, 2019
• "Natural Alternatives International, Inc. v. Creative Compounds, LLC (Fed. Cir. 2019)," March 19, 2019

8.  Supreme Court: Prevailing Applicants Not Liable for USPTO's Attorney's Fees

Last month, in Peter v. NantKwest, Inc., the Supreme Court considered whether the U.S. Patent and Trademark Office could compel an aggrieved applicant to pay its attorney's fees in a § 145 review, regardless of who wins or loses.  The Court unanimously rejected the USPTO's arguments.  In doing so, the Court bolstered the "American Rule" on attorney's fees and preserved § 145 proceedings as a financially viable option for review of adverse Patent Trial and Appeal Board (PTAB) decisions.  The decision expressly considered only patent reviews, but it also applies to analogous reviews of trademark decisions.  Thus, it has impact on cases far more broadly than just § 145 proceedings.

For information regarding this and other related topics, please see:

• "Peter v. NantKwest, Inc. (2019)," December 11, 2019
• "Peter v. NantKwest: PTO Faces Skeptical Justices over Assessment of Fees," October 7, 2019
• "Supreme Court Grants Certiorari in Iancu v. NantKwest, Inc.," March 4, 2019

7.  Supreme Court: Federal Government Cannot Petition for Review in AIA Post-grant Proceedings

In June, the Supreme Court determined in Return Mail, Inc. v. United States Postal Service that federal government agencies cannot avail themselves of America Invents Act (AIA) post-grant proceedings.  This decision was based on the Court's determination that the government is not a "person" as that term is used in relation to inter partes review (IPR), post-grant review (PGR), and covered business method (CBM) proceedings.  To parties accusing the federal government of infringing their patents, the decision means that they will be free of AIA post-grant challenges from the accused agency.

For information regarding this and other related topics, please see:

• "Return Mail, Inc. v. United States Postal Service (2019)," June 10, 2019
• "Supreme Court Hears Oral Argument in Return Mail v. U.S. Postal Service," February 19, 2019

6.  Congressional Effort to Reform § 101 Slows

In April, Senator Thom Tillis (R-NC), Chair of the Senate Judiciary Subcommittee on Intellectual Property, and Senator Chris Coons (D-DE), Ranking Member, joined by Representative Doug Collins (R-GA-9), Ranking Member of the House Judiciary Committee, and Representatives Hank Johnson (D-GA-4), and Steve Stivers (R-OH-15), released a "bipartisan, bicameral framework on Section 101 patent reform."  A month later, the group released a draft bill proposing significant changes to 35 U.S.C. § 101 and the law of patent eligibility.  The draft bill would completely eliminate the notion of a judicial exception to patent eligibility as well as clarify that the § 101 inquiry is separate from those of §§ 102, 103, and 112.  In other words, patentable subject matter under the draft bill would likely be as broad or even broader than the "anything under the sun that is made by man" language of Diamond v. Chakrabarty.  In June, the Senate Subcommittee on Intellectual Property held hearings on its proposal to revise 35 U.S.C. § 101, and in particular the draft bill that was released in May.  Chairman Tillis and Ranking Member Coons (with an occasional third senator in the room) heard testimony from forty-five individuals representing a broad swathe of patent expertise including industry executives and groups, inventors, a former Federal Circuit judge, former U.S. Patent and Trademark Office officials, and law professors.  Following those hearings, Senators Tillis and Coons released a statement regarding their takeaway from the hearings.  If anything, their statement reflected an understanding that the law needs to change, the Senators are committed to doing so, and that they still need to work out the details.  Despite the whirlwind of activity in April, May, and June, legislative progress has slowed since Senators Tillis and Coons released their statement at the end of June, and the patent community awaits the Senators' next move.

For information regarding this and other related topics, please see:

• "Biotech Prospects for Patent Reform," June 26, 2019
• "Senators Tillis and Coons Release Statement on Recent Patent Reform Hearings," June 26, 2019
• "Senate Subcommittee on Intellectual Property Holds Hearings on Proposed Revisions to 35 U.S.C. § 101," June 17, 2019
• "ACLU (Predictably) Opposes Patent Subject Matter Eligibility Proposal," June 3, 2019
• "Senate Proposal for Section 101 Reform: Effect on Biotech/Pharma Inventions," May 23, 2019
• "Congress Proposes Draft Bill to Change 35 U.S.C. § 101," May 23, 2019
• "Congress Releases Framework for Section 101 Reform," April 17, 2019
• "Law Review Article Advocates Supreme Court's Patent Eligibility Law is Unconstitutional," February 20, 2019

Top Stories of 2019: #11 to #15

By Donald Zuhn –-

After reflecting upon the events of the past twelve months, Patent Docs presents its 13th annual list of top patent stories.  For 2019, we identified fifteen stories that were covered on Patent Docs last year that we believe had (or are likely to have) a significant impact on patent practitioners and applicants.  Today, we count down stories #15 to #11, and in the coming week, we will work our way towards the top stories of 2019.  As with our other lists (2018, 2017, 2016, 2015, 2014, 2013, 2012, 2011, 2010, 2009, 2008, and 2007), links to our coverage of these stories (as well as a few links to articles on related topics) have been provided in case you missed the articles the first time around or wish to go back and have another look.  As always, we love to hear from Patent Docs readers, so if you think we left something off the list or disagree with anything we included, please let us know.  In addition, we will be offering a live webinar on the "Top Patent Law Stories of 2019" on January 22, 2020 from 10:00 am to 11:15 am (CT).  Details regarding the webinar, which will focus on a handful of the most important stories on this year's list, can be found here.

15.  USPTO Declares Interference Between Broad Institute and UC Berkeley over CRISPR Technology

In December 2015, the journal Science picked the CRISPR (clustered regularly interspaced short palindromic repeats) technology as its "Breakthrough of the Year," declaring that the technology had "matured into a molecular marvel."  Not surprisingly, CRISPR's status as breakthrough molecular marvel has resulted in a battle over who has the best patent position with respect to this technology.  In June, the U.S. Patent and Trademark Office declared an interference between patents (and an application) assigned to the Broad Institute, Inc., the Massachusetts Institute of Technology, and the President and Fellows of Harvard College and applications assigned to the Regents of the University of California, the University of Vienna, and Emmanuelle Charpentier.  If the new interference sounds to Patent Docs readers like deja vu all over again, it is and it isn't –– the strategy employed by UC Berkeley has induced the Office to address the issues of priority raised in the earlier interference between the parties.  The parties have filed a number of motions and responses to those motions, as evidenced by the links below, and Patent Docs will continue to cover the latest battle over the rights to this revolutionary genome engineering technology.

For information regarding this and other related topics, please see:

• "CRISPR Interference Update," December 26, 2019
• "Broad Files Reply Brief to Berkeley's Opposition to Substantive Motion No. 1," December 17, 2019
• "Berkeley Files Responsive Motion to Broad's Substantive Motion No. 2 in Interference," December 12, 2019
• "Berkeley Files Substantive Motion No. 2 to be Accorded Benefit to Earlier Priority Application in Interference," December 10, 2019
• "CRISPR Housekeeping," November 25, 2019
• "CRISPR Motions Day at the PTAB: Broad Files Its Substantive Motion No. 4," November 24, 2019
• "CRISPR Motions Day at the PTAB: Broad Files Its Substantive Motion No. 3," November 20, 2019
• "CRISPR Motions Day at the PTAB: Broad Files Its Substantive Motion No. 2," November 18, 2019
• "Berkeley Files Opposition to Broad's Substantive Motion No. 1 in Interference," November 10, 2019
• "Board Denies CVC Motion to Seal Priority Statement," November 4, 2019
• "Sigma-Aldrich Tries Again," October 27, 2019
• "University of California/Berkeley et al. Authorized to File Motion Opposed to Broad Substantive Motion No. 1," September 30, 2019
• "Broad Institute Takes Its Turn in Interference Motion Practice," September 24, 2019
• "CRISPR Interference: Motion Practice," September 11, 2019
• "PTAB Redeclares CRISPR Interference and Grants Leave for Some (But Not All) of Parties' Proposed Motions," August 29, 2019
• "University of California/Berkeley Granted Yet Another CRISPR Patent," August 25, 2019
• "CRISPR Interference Parties Propose Motions," August 1, 2019
• "Sigma-Aldrich Wants Its Piece of CRISPR Pie," July 21, 2019
• "New CRISPR Interference: The Details," July 8, 2019
• "CRISPR Battle Joined Again," July 1, 2019
• "Another U.S. Patent Issued for CRISPR," April 28, 2019
• "CRISPR Patent Watch," March 12, 2019

14.  Solicitor General: Berkheimer Not Appropriate Vehicle for Addressing Uncertainty Concerning § 101 Standards

Berkheimer v. HP Inc. was decided by the Federal Circuit in February 2018 and stands for -- in the words of Judge Moore -- "the unremarkable proposition that whether a claim element or combination of elements would have been well-understood, routine, and conventional to a skilled artisan in the relevant field at a particular point in time is a question of fact."  In September 2018, HP petitioned the Supreme Court for certiorari, and earlier this year, the Court requested that the Solicitor General file a brief expressing the views of the United States in this matter.  That brief arrived in December, and the Solicitor General expressed the opinion that the overall lack of clarity regarding the fundamental issues surrounding patent eligibility under 35 U.S.C. § 101 makes addressing the points of Berkheimer premature.  The Solicitor General began the brief by declaring that "this Court's recent decisions have fostered uncertainty concerning those substantive Section 101 standards," noting that the uncertainty lies mainly in the "the scope of the exceptions and the proper methodology for determining whether a particular patent implicates them."  Berkheimer being largely a procedural case, the Solicitor General suggests that it would not be the appropriate vehicle for addressing the more fundamental substantive questions, opining that HP's question "would be difficult to answer in any cogent manner while uncertainty about the substance of the Section 101 inquiry persists."  The Supreme Court is scheduled to discuss HP's petition at Conference on January 10, 2020.

For information regarding this and other related topics, please see:

• "Solicitor General Files Brief in Berkheimer v. HP," December 9, 2019

13.  Federal Circuit Revisits Safe Harbor Provisions of 35 U.S.C. § 271(e)(1)

The Federal Circuit has grappled with, divisively in some instances, the extent to which the safe harbor provisions of 35 U.S.C. § 271(e)(1) extend to activities that are not strictly for obtaining regulatory approval, such as post-approval quality testing and "stockpiling" product used for commercial purposes.  For example, in 2011, in Classen Immunotherapies, Inc. v. Biogen IDEC, then-Chief Judge Rader joined by Judge Newman held that "routine" post-approval submissions are outside the safe harbor (over a vigorous dissent by Judge Moore), whereas in 2012, in Momenta Pharmaceuticals, Inc. v. Amphastar Pharmaceuticals, Inc., the roles were reversed, with Judge Moore finding herself in the majority (with Judge Dyk), and then-Chief Judge Rader filing a dissent.  In December, the Federal Circuit revisited these issues in Amgen Inc. v. Hospira, Inc., in a decision authored by Judge Moore and joined by Judges Bryson and Chen.  The Federal Circuit affirmed the jury's decision that fourteen batches of Hospira's erythropoietin (EPO) were not protected under the § 271(e)(1) safe harbor, and that seven other batches were clearly made for purposes related to obtaining FDA approval and therefore were protected under the safe harbor.

For information regarding this and other related topics, please see:

• "Amgen Inc. v. Hospira, Inc. (Fed. Cir. 2019)," December 18, 2019

12.  Supreme Court on Preemption of State Tort Liability by Compliance with Federal Law and Regulations

In May, in Merck Sharp & Dohme Corp. v. Albrecht, the Supreme Court continued its explication of the balance between state law tort liability that can be imposed on drug makers and the extent to which this liability can be pre-empted by the drug maker's compliance with Federal laws and regulations, particularly those related to FDA approval.  In an opinion authored by Justice Breyer, the Court held that the pre-emption question is for a judge to decide, and not a jury.  The Court also found that pre-emption is limited to those circumstances where "it is 'impossible for a private party to comply with both state and federal requirements.'"  The Court also explained that the meaning of "clear evidence" (in the context of the evidence that the FDA would not have approved a manufacturer requested change to the label) to be "evidence that shows the court that the drug manufacturer fully informed the FDA of the justifications for the warning required by state law and that the FDA, in turn, informed the drug manufacturer that the FDA would not approve a change to the drug's label to include that warning."

For information regarding this and other related topics, please see:

• "Merck Sharp & Dohme Corp. v. Albrecht (2019)," May 27, 2019

11.  Federal Circuit: When "No Identifiable Efforts" Could Have Been Undertaken, Applicant Has Not Failed to Engage in Reasonable Efforts to Conclude Prosecution

In January, the Federal Circuit determined in Supernus Pharmaceuticals, Inc. v. Iancu that the U.S. Patent and Trademark Office had erred in calculating the Patent Term Adjustment (PTA) for Supernus' U.S. Patent No. 8,747,897.  In particular, the Court found that because there were "no identifiable efforts" that Supernus could have undertaken in the time period between the filing of an RCE during prosecution of the application that issued as the '897 patent and the mailing of an EPO notification of opposition for a European counterpart patent (which resulted in Supernus filing a supplemental Information Disclosure Statement), Supernus had not failed to engage in reasonable efforts to conclude prosecution (pursuant to 35 U.S.C. § 154(b)(2)(C)(i)) during that time period.  In October, the USPTO published a notice of proposed rulemaking in which the Office proposed certain revisions to the rules of practice concerning PTA in view of the Federal Circuit's Supernus decision.  In particular, the Office proposed revising the period of reduction of PTA for several provisions of 37 C.F.R. § 1.704, in which the period of reduction will correspond to "the period from the beginning to the end of the applicant's failure to engage in reasonable efforts to conclude prosecution" as opposed to the consequences to the Office of applicant's failure to engage in reasonable efforts to conclude prosecution.

For information regarding this and other related topics, please see:

• "USPTO Proposes Revisions to PTA Rules in View of Supernus v. Iancu," October 6, 2019
• "Intra-Cellular Therapies, Inc. v. Iancu (Fed. Cir. 2019)," September 26, 2019
• "Mayo Foundation for Medical Education and Research v. Iancu (Fed. Cir. 2019)," September 17, 2019
• "USPTO Issues Notice on Impact of Federal Circuit's Supernus Decision on PTA Procedures," May 29, 2019
• "Supernus Pharmaceuticals, Inc. v. Iancu (Fed. Cir. 2019)," January 27, 2019