Plausible and specific factual allegations of inventive claims are enough to survive a motion to dismiss for Patent Ineligible Subject Matter

Andrew Melick | July 22, 2019

Cellspin Soft, Inc. v. Fitbit, Inc.

June 25, 2019

Lourie, O’Malley, and Taranto

Summary:

 Cellspin sued Fitbit and nine other defendants for infringement of various claims of four different patents relating to connecting a data capture device such as a digital camera to a mobile device. Fitbit filed a motion to dismiss under Rule 12(b)(6) because the asserted claims of all of the patents are to patent ineligible subject matter under § 101. The district court granted the motion to dismiss and Cellspin appealed to the CAFC. The CAFC agreed with the district court that the claims recite an abstract idea under step one of the Alice test. However, under step two of the Alice test, the CAFC stated that Cellspin made “specific, plausible factual allegations about why aspects of its claimed inventions were not conventional,” and that “the district court erred by not accepting those allegations as true.” Thus, the CAFC vacated the district court decision and remanded.

Details:

Cellspin sued Fitbit and nine other defendants for infringement of several claims of four different patents. The four patents are U.S. Patent Nos. 8,738,794; 8,892,752; 9,258,698; and 9,749,847. These patents share the same specification and relate to connecting a data capture device such as a digital camera, to a mobile device so that a user can automatically publish content from the data capture device to a website.

According to the ‘794 patent, prior art devices had to transfer their content from the digital capture device to a personal computer using a memory stick or cable. The ‘794 patent teaches using a short-range wireless communication protocol such as bluetooth to automatically or with minimal user intervention transfer and upload data from a data capture device to a mobile device.  The mobile device can then automatically or with minimal user intervention publish the content on websites.

Claim 1 of the ‘794 patent recites:

1. A method for acquiring and transferring data from a Bluetooth enabled data capture device to one or more web services via a Bluetooth enabled mobile device, the method comprising:

providing a software module on the Bluetooth enabled data capture device;

providing a software module on the Bluetooth enabled mobile device;

establishing a paired connection between the Bluetooth enabled data capture device and the Bluetooth enabled mobile device;

acquiring new data in the Bluetooth enabled data capture device, wherein new data is data acquired after the paired connection is established;

detecting and signaling the new data for transfer to the Bluetooth enabled mobile device, wherein detecting and signaling the new data for transfer comprises:

determining the existence of new data for transfer, by the software module on the Bluetooth enabled data capture device; and

sending a data signal to the Bluetooth enabled mobile device, corresponding to existence of new data, by the software module on the Bluetooth enabled data capture device automatically, over the established paired Bluetooth connection, wherein the software module on the Bluetooth enabled mobile device listens for the data signal sent from the Bluetooth enabled data capture device, wherein if permitted by the software module on the Bluetooth enabled data capture device, the data signal sent to the Bluetooth enabled mobile device comprises a data signal and one or more portions of the new data;

transferring the new data from the Bluetooth enabled data capture device to the Bluetooth enabled mobile device automatically over the paired Bluetooth connection by the software module on the Bluetooth enabled data capture device;

receiving, at the Bluetooth enabled mobile device, the new data from the Bluetooth enabled data capture device;

applying, using the software module on the Bluetooth enabled mobile device, a user identifier to the new data for each destination web service, wherein each user identifier uniquely identifies a particular user of the web service;

transferring the new data received by the Bluetooth enabled mobile device along with a user identifier to the one or more web services, using the software module on the Bluetooth enabled mobile device;

receiving, at the one or more web services, the new data and user identifier from the Bluetooth enabled mobile device, wherein the one or more web services receive the transferred new data corresponding to a user identifier; and

making available, at the one or more web services, the new data received from the Bluetooth enabled mobile device for public or private consumption over the internet, wherein one or more portions of the new data correspond to a particular user identifier.

The opinion highlighted as relevant that claim 1 requires establishing a paired connection between the data capture device and the mobile device before data is transmitted between the two. The other claims from the other patents recite small variations of claim 1 of the ‘794 patent.

Nine defendants filed a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) and one defendant filed a motion to dismiss under Federal Rule of Civil Procedure 12(c). The motions argued that the asserted patents are ineligible under § 101. The district court granted the motions to dismiss stating that all of the asserted claims from all of the asserted patents are to ineligible subject matter under § 101.

CAFC – Step One Analysis

Cellspin argued that the claims are directed to improving internet-capable data capture devices and mobile networks and that its claims recite technological improvements because the claims describe improving data capture devices by allowing even “internet-incapable” capture devices to transfer newly captured data to the internet via an internet capable mobile device.

The CAFC characterized the claims as “drawn to the idea of capturing and transmitting data from one device to another.” And the CAFC stated that they have “consistently held that similar claims reciting the collection, transfer, and publishing of data are directed to an abstract idea,” and that these cases “compel the conclusion that the asserted claims are directed to an abstract idea as well.” The CAFC further stated that the patents acknowledge that users could already transfer data from a data capture device (even an internet-incapable device) to a website using a cable connected to a PC, and that the patents provided a way to automate this transfer. Thus, the CAFC concluded that the district court correctly held that the asserted claims are to an abstract idea.

CAFC – Step Two Analysis

Cellspin argued that the claimed invention was unconventional. They described the prior art devices as including a capture device with built-in wireless internet, but that these devices were inferior because at the time of the patent priority date, these combined devices were bulky, expensive in terms of hardware and expensive in terms of requiring an extra or separate cellular service for the data capture device. Cellspin stated that its device was unconventional in that it separated the steps of capturing and publishing the data by separate devices linked by a wireless, paired connection. This invention allowed for the data capture device to serve one core function of capturing data without the need to incorporate other hardware and software components for storing data and publishing on the internet. And one mobile device with one data plan can be used to control several data capture devices.

Cellspin further argued that its specific ordered combination of elements was inventive because Cellspin’s claimed device requires establishing a paired connection between the mobile device and the data capture device before data is transmitted, whereas the prior art data capture device forwarded data to a mobile device as captured regardless of whether the mobile device is capable of receiving the data, i.e. whether the mobile device is on and whether the mobile device is near the data capture device. Cellspin also argued that its use of HTTP transfers of data received over a paired connection to web services was non-existent prior to its invention.

The district court stated that Cellspin failed to cite support in the patent specifications for its allegations regarding the inventive concepts and benefits of its invention. However, the CAFC stated that in the Aatrix case (Aatrix Software Inc. v. Green Shades Software, Inc., 882 F.3d 1121 (Fed. Cir. 2018)), they repeatedly cited allegations in the complaint to conclude that the disputed claims were potentially inventive. The CAFC stated:

While we do not read Aatrix to say that any allegation about inventiveness, wholly divorced from the claims or the specification, defeats a motion to dismiss, plausible and specific factual allegations that aspects of the claims are inventive are sufficient. Id. As long as what makes the claims inventive is recited by the claims, the specification need not expressly list all the reasons why this claimed structure is unconventional.

The CAFC stated that in this case, Cellspin made “specific, plausible factual allegations about why aspects of its claimed inventions were not conventional,” and that “the district court erred by not accepting those allegations as true.”

The district court also did not give weight to Cellspins’ allegations because Cellspin relied on Berkheimer (Berkheimer v. HP Inc., 881 F.3d 1360 (Fed. Cir. 2018)), which was distinguished by the district court because the Berkheimer case dealt with a motion for summary judgment. But the CAFC stated that the district court’s conclusion cannot be reconciled with the Aatrix case and stated:

The district court thus further erred by ignoring the principle, implicit in Berkheimer and explicit in Aatrix, that factual disputes about whether an aspect of the claims is inventive may preclude dismissal at the pleadings stage under § 101.

The CAFC further stated that Cellspin did more than just label certain techniques as inventive; Cellspin pointed to evidence suggesting that these techniques had not been implemented in the same way. The CAFC concluded that Cellspin sufficiently alleged that they claimed significantly more than the idea of capturing, transferring or publishing data, and thus the district court erred by granting the motion to dismiss.

Attorney Fees

The CAFC also commented on the district court’s decision to award attorney fees to the defendant. The district court awarded attorney fees to the defendants because the district court deemed the case exceptional due to actions by Cellspin. But since the CAFC found that the district court erred in granting the motions to dismiss, the CAFC vacated the award of attorney fees. But the CAFC went further to point out errors by the district court in determining the case to be exceptional.

The CAFC faulted the district court for not presuming that the issued patents are eligible. The CAFC stated that issued patents are not only presumed to be valid but also presumed to be patent eligible. In citing Berkheimer, the CAFC stated that underlying facts regarding whether a claim element or combination is well-understood or routine must be proven by clear and convincing evidence.

Comments

A patent owner as a plaintiff in an infringement suit can defend against a motion to dismiss by providing “specific, plausible factual allegations” about why aspects of the claimed invention were not conventional. Explicit description in the specification providing reasons why the claimed invention is unconventional is not required as long as the claim recites what makes the claim inventive. Also, this case states that underlying facts regarding ineligibility must be proven by clear and convincing evidence.

Even though this case states that explicit description in the specification regarding why the invention is unconventional is not required, patent applicants should consider including a description in the specification regarding why the invention or certain aspects of the invention are unconventional to make their patents stronger.  

The Federal Circuit Affirms PTAB’s Obvious Determination Against German-Based Non-Practicing Entity, Papst Licensing GMBH & Co., Based on Both Issue Preclusion and Lack of Merit

Stephen Parker | July 19, 2019

Papst Licensing GMBH & Co. v. Samsung

May 23, 2019

Dyk, Taranto, and Chen. Opinion by Taranto

Summary

            German-based non-practicing entity Papst Licensing GMBH & Co. is the owner of U.S. Patent No. 9,189,437 entitled “Analog Data Generating and Processing Device Having a Multi-Use Automatic Processor.”  The ‘437 patent issued in 2015 and claims priority to an original application filed in 1999 through continuation applications, and is one of a family of at least seven patents based on the same specification and/or priority that have been asserted in litigations by Papst against various entities to seek licenses.  Here, Samsung successfully brought an Inter Parties Review (IPR) proceeding before the Patent & Trademark Appeal Board (PTAB) in which the PTAB held that claims of the ‘437 were invalid as obvious over prior art.   Papst appealed the PTAB’s decision, and, on appeal, the Federal Circuit affirmed the PTAB’s decision based on both issue preclusion and obviousness.

Details

Procedural Background

German-based non-practicing entity Papst Licensing GMBH & Co. (“Papst”) is the owner of U.S. Patent No. 9,189,437 entitled “Analog Data Generating and Processing Device Having a Multi-Use Automatic Processor.”  The ‘437 patent issued in 2015 and claims priority to an original application filed in 1999 through continuation applications, and is one of a family of at least seven patents based on the same specification and/or priority that have been asserted in litigations by Papst against various companies to seek licenses.  In response to such litigations, various combinations of companies filed numerous petitions for Inter Partes Review (IPR) to review many claims of the family of patents.   In this case, Samsung successfully initiated an IPR proceeding before the Patent & Trademark Appeal Board (PTAB) in which the PTAB held that claims of the ‘437 were invalid as obvious over prior art. 

Factual Background

            The patent at issue on appeal is U.S. Patent No. 9,189,437 is entitled “Analog Data Generating and Processing Device Having a Multi-Use Automatic Processor.”  The specification describes an interface device for communication between a data device (on one side of the interface) and a host computer (on the other).  The interface device achieves high data transfer rates, without the need for a user-installed driver specific to the interface device, by using fast drivers that are already standard on the host computer for data transfer, such as a hard-drive driver.   In short, the interface device sends signals to the host device that the interface device is an input/output device for which the host already has such a driver – i.e., such that the host device perceives the interface device to actually be that other input/output device.

            For reference, claim 1of the ‘437 patent is shown below:

1. An analog data generating and processing de-vice (ADGPD), comprising:

an input/output (i/o) port;

a program memory;

a data storage memory;

a processor operatively interfaced with the i/o port, the program memory and the data storage memory;

wherein the processor is adapted to implement a data generation process by which analog data is acquired from each respective analog acquisition channel of a plurality of independent analog acquisition channels, the analog data from each respective channel is digitized, coupled into the processor, and is processed by the processor, and the processed and digitized analog data is stored in the data storage memory as at least one file of digitized analog data;

wherein the processor also is adapted to be involved in an automatic recognition process of a host computer in which, when the i/o port is operatively interfaced with a multi-purpose interface of the host computer, the processor executes at least one instruction set stored in the program memory and thereby causes at least one parameter identifying the analog data generating and processing device, independent of analog data source, as a digital storage device instead of an analog data generating and processing device to be automatically sent through the i/o port and to the multi-purpose interface of the computer (a) without requiring any end user to load any software onto the computer at any time and (b) without requiring any end user to interact with the computer to set up a file system in the ADGPD at any time, wherein the at least one parameter is consistent with the ADGPD being responsive to commands is-sued from a customary device driver;

            wherein the at least one parameter provides information to the computer about file transfer characteristics of the ADGPD; and

            wherein the processor is further adapted to be involved in an automatic file transfer process in which, when the i/o port is operatively interfaced with the multi-purpose interface of the computer, and after the at least one parameter has been sent from the i/o port to the multi-purpose interface of the computer, the processor executes at least one other instruction set stored in the program memory to thereby cause the at least one file of digitized analog data acquired from at least one of the plurality of analog acquisition channels to be transferred to the computer using the customary device driver for the digital storage device while causing the analog data generating and processing device to appear to the computer as if it were the digital storage device without requiring any user-loaded file transfer enabling software to be loaded on or in-stalled in the computer at any time.

a. The Board’s IPR Decision Related to the ‘437 Patent

Before the PTAB, the board held that the relevant claims of the ‘437 – claims 1-38 and 43-45 – were invalid as obvious over U.S. Patent No. 5,758,081 (Aytac), a publication setting forth standards for SCSI interfaces (discussed in the ‘081 patent) and “admitted” prior art described in the ‘437 patent.

The Aytac patent describes connecting a personal computer to an interface device that would in turn connect to (and switch between) various other devices, such as a scanner, fax machine, or telephone.  The interface device includes the “CaTbox,” which is connected to a PC via SCSI cable, and to a telecommunications switch.

In its determination of obviousness, the Board adopted a claim construction that is central to Papst’s appeal.  In particular, claim 1 of the ‘437 patent requires an automatic recognition process to occur “without requiring any end user to load any software onto the computer at any time” and an automatic file transfer process to occur “without requiring any user-loaded file transfer enabling software to be loaded on or installed in the computer at any time.”

The Board interpreted the “without requiring” limitations to mean “without requiring the end user to install or load specific drivers or software for the ADGPD beyond that included in the operating system, BIOS, or drivers for a multi-purpose interface or SCSI interface.”   In adopting that construction, among those that can be required to be installed for the processes to occur, relying on the specification and claims as making clear that the invention contemplates use of SCSI drivers to carry out the processes.

The Board also rejected Papst’s contention that “the ‘without requiring’ limitations prohibit an end user from installing or loading other drivers.”

b. The Board’s IPR Decision Related to the ‘144 Patent

With respect to another U.S. Patent in Papst’s family of patents – i.e., U.S. Patent No. 8,966,144, which is based on the same specification as the ‘437 patent – the PTAB had issued a similar IPR decision, in which the same claim limitations of “without requiring …” were similarly interpreted as in the present board decision and in which the claim limitation was similarly found to be obvious over the same prior art as applied in the present board decision. 

Following the PTAB decision related to the ‘144 patent, Papst appealed the decision to the Federal Circuit.  However, on the eve before oral arguments, Papst voluntarily dismissed its appeal, whereby the PTAB’s decision related to the ‘144 patent became final.

Discussion

           On appeal, the Federal Circuit affirmed the PTAB’s decision based on both issue preclusion and obviousness.

  1.  Issue Preclusion

            The Federal Circuit explained that “[t]he Supreme Court has made clear that, under specified conditions, a tribunal’s resolution of an issue that is only one part of an ultimate legal claim can preclude the loser on that issue from later contesting, or continuing to contest, the same issue in a separate case.  Thus:

subject to certain well-known exceptions, the general rule is that “[w]hen an issue of fact or law is actually litigated and determined by a valid and final judgment, and the determination is essential to the judgment, the determination is conclusive in a subsequent action between the parties, whether on the same or a different claim.”

The Federal Circuit noted that “we have held that the same is true of an IPR proceeding before the Patent Trial and Appeal Board, so that the issue preclusion doctrine can apply in this court to the Patent Trial and Appeal Board’s decision in an IPR once it becomes final.”

The well-known exception, noted by the Federal Circuit, involved that: the court recognizes that “[i]ssue preclusion may be in-apt if ‘the amount in controversy in the first action [was] so small in relation to the amount in controversy in the second that preclusion would be plainly unfair.”

However, the Federal Circuit emphasized that that was not the case here, and, the court also emphasized that, in the ‘144 case Papst even brought the litigation through to the eve of oral argument, which highlights that that was not the case.  Notably, the Federal Circuit also emphasizes that:  “More generally, given the heavy burdens that Papst placed on its adversaries, the Board, and this court by waiting so long to abandon defense of the ’144 patent and ’746 patent claims, Papst’s course of action leaves it without a meaningful basis to argue for systemic efficiencies as a possible reason for an exception to issue preclusion.

With respect to issue preclusion, the Federal Circuit explained that the Board in the ’144 patent decisionresolved the same claim construction issue in the same way as the Board in the present IPR.  It characterized “the issue in dispute” as “center[ing] on whether the ‘without requiring’ limitations prohibit an end user from installing or loading other drivers.”   Moreover, the Federal Circuit also explained that “the Board also ruled that use of SCSI software does not violate the ‘without requiring’ limitations, because the patent clearly showed that such software may be used,” and that “[t]hat ruling was not just materially identical to the Board’s claim construction ruling in this case; it also was essential to the Board’s ultimate determination, which depended on finding that the installation of CATSYNC, as disclosed in Aytac, was not prohibited by the ’144 patent’s “without requiring” limitation and that Aytac taught that the transfer process could be performed with SCSI software.”

            Thus, the Federal Circuit held that issue preclusion applied in this case related to the ‘437 patent.

  • Obviousness

            On appeal, Papst presents two arguments that are addressed by the Federal Circuit  First, Papst argues that the board improperly construed the limitation “without requiring” as meaning that the claimed processes can take place with SCSI software (or other multi-purpose interface soft-ware or software included in the operating system or BIOS)..  Second, Papst argues that the board improperly concluded that Aytac teaches an automatic file transfer that can take place with only the SCSI drivers, without the assistance of user-added CATSYNC software.

            With respect to the obviousness evaluation, the Federal Circuit found the Board’s conclusion regarding the construction of the “without requiring” limitations of the ‘437 patent to be correct based on the “ordinary meaning” of the words employed.  The Federal Circuit explained that “[t]o state that a process can take place “without requiring” a particular action or component is, by the words’ ordinary meaning as confirmed in Celsis In Vitro, to state simply that the process can occur even though the action or component is not present; it is not to forbid the presence of the particular action or component.”

            In addition, the Federal Circuit also agreed with the Board’s conclusion that SCSI interface software was permitted software in the claim construction because of the description in the specification of the ‘437 patent.  The Federal Circuit expressed that:  “The specification is decisive.  Reflecting the recognition that SCSI interfaces were ‘present on most host devices or laptops’ at the time” and that “the specification explains that the invention  contemplates use of SCSI software.”

            Moreover, the Federal Circuit agreed that the “Board’s finding that a relevant skilled artisan would understand that the Aytac’s CaTbox can perform an automatic file transfer using SCSI without the CATSYNC software that Papst says is required, ” noting that Samsung’s expert Dr. Reynolds testified that only the SCSI protocol and the ASPI drivers are needed to transfer a file in Aytac, similar to the function of the ’437 patent.

            Thus, the Federal Circuit affirmed the board’s determinations of obviousness related to the ‘437 patent.

Takeaway

When asserting patent infringement of multiple similar patents in a patent family, there is an increased risk of facing issue preclusion issues.

There is a Standing to Defend Your Expired Patent Even If an Infringement Suit Has Been Settled

Sung-Hoon Kim | July 8, 2019

Sony Corp. v. Iancu

Summary:

The CAFC vacated the PTAB’s decision, in which the PTAB found that the limitation “reproducing means” is not computer-implemented and does not require an algorithm because this limitation should have been construed as computer-implemented and that the corresponding structure is a synthesizer and controller that performs the algorithm described in the specification.  In addition, the CAFC found that there is a standing to appeal to defend an expired patent because the CAFC’s decision would have a consequence on any infringement that took place during the life of the patent.

Details:

Sony is the owner of U.S. Patent No. 6,097,676 (“the ’676 patent”) and appeals the PTAB’s decision in IPR, in which the PTAB found claims 5 and 8 of the ’676 patent unpatentable as obvious.

The ’676 patent:

            The ’676 patent is directed to an information recording medium that can store audio data having multiple channels and a reproducing device that can select which channel to play based on a default code or value stored in a memory.  This reproducing device has (1) storing means for storing the audio information, (2) reading means for reading codes associated with the audio information, and (3) reproducing means for reproducing the audio information based on the default code or value.

            Claim 5 of the ’676 patent recites:

5.         An information reproducing device for reproducing an information recording medium in which audio data of plural channels are multiplexedly recorded, the information reproducing device comprising:

storing means for storing a default value for designating one of the plural channels to be reproduced; and

reproducing means for reproducing the audio data of the channel designated by the default value stored in the storing means; and

wherein a plurality of voice data, each voice data having similar contents translated into different languages are multiplexedly recorded as audio data of plural channels; and a default value for designating the voice data corresponding to one of the different languages is stored in the storing means.

            Claim 8 recites the same features as claim 5 with some additional features.

The PTAB:

            The PTAB instituted IPR as to claims 5 and 8 of the ’676 patent.  The issue during IPR was whether the “reproducing means” was computer-implemented and required an algorithm.

            On September, 2017, the PTAB issued a final decision, where the claims were found to be unpatentable as obvious over the Yoshio reference.  The PTAB construed the “reproducing means” has a means-plus-function limitation, and found that its corresponding structure is a controller and a synthesizer, or the equivalents.  Furthermore, the PTAB found that this limitation is not computer-implemented and does not require an algorithm because a controller and a synthesizer are hardware elements.

The CAFC:

            The CAFC agreed with Sony’s argument that the “reproducing means” requires an algorithm to carry out the claimed function.

            The CAFC held that:

“In cases involving a computer-implemented invention in which the inventor has invoked means-plus-function claiming, this court has consistently required that the structure disclosed in the specification be more than simply a general purpose computer or microprocessor.Aristocrat Techs. Austl. Pty Ltd. v. Int’l Game Tech., 521 F.3d 1328, 1333 (Fed. Cir. 2008). For means-plus-function claims “in which the disclosed structure is a computer, or microprocessor, programmed to carry out an algorithm,” we have held that “the disclosed structure is not the general purpose computer, but rather the special purpose computer programmed to perform the disclosed algorithm.WMS Gaming, Inc. v. Int’l Game Tech., 184 F.3d 1339, 1349 (Fed. Cir. 1999).

The specification of the ’676 patent discloses that “[i]n reproducing such a recording medium by using the reproducing device of the present invention, the processing as shown in FIG. 16 is executed.”  In fact, Fig. 16 discloses an algorithm in the form of a flowchart.

Therefore, the CAFC held that the “reproducing means” of claims 5 and 8 of the ’676 patent should be construed as computer-implemented and that the corresponding structure is a synthesizer and controller that performs the algorithm described in the specification.

Accordingly, the CAFC vacated the PTAB’s decision and remand for further consideration of whether the Yoshio reference discloses a synthesizer and controller that performs the algorithm described in the specification, or equivalent, and whether the claims would have been obvious over the Yoshio reference.

Standing to Appeal:

The ’676 patent was expired in August 2017.  Petitioners have elected not to participate in the appeal before the CAFC.  The parties have settled the district court infringement suit involving this patent. 

Is there a standing to appeal?

Majority: YES because

  • The parties to this appeal remain adverse and none has suggested the lack of an Article III case or controversy.
  • The PTO argues that the PTAB’s decision should be affirmed.
  • Sony argues that the PTAB’s decision should be reversed and the claims should be patentable.
  • The CAFC’s decision would have a consequence on any infringement that took place during the life of the ’676 patent (past damages subject to the 6-year limitation and the owner of an expired patent can license the rights or transfer title to an expired patent).

Dissenting: NO because

  • No private and public interest (patent expired, petitioner declined to defend its victory, and infringement suit has been settled).
  •  No hint or possibility of present or future case or controversy by both parties and the PTO.

Takeaway:

  • Even if the patent has expired, the patentee has a standing to appeal before the CAFC to dispute the PTAB’s final decision.
  • An algorithm described in the specification for means-plus-function language helped the patentee with a narrow claim construction.

Satisfying Written Description When Therapeutic Effectiveness is Claimed

Bernadette McGann | June 26, 2019

Nuvo Pharmaceuticals v. Dr. Reddy’s Laboratories

Summary

            The CAFC reversed and dismissed a holding by the District Court that the claims of the ‘907 and the ‘285 patents had adequate written description regarding the efficacy of an uncoated PPI.  The CAFC states that it not necessary to prove that a claimed pharmaceutical compound actually achieves a certain result.  However, if the claim recites said result, then there must be sufficient support in the specification.  Herein, the claims were held invalid because the therapeutic effectiveness of uncoated PPI, which was recited in the claims, was not supported by the specification. 

Details

The use of a non-steroidal anti-inflammatory drug (hereinafter “NSAID”), such as aspirin, can cause gastrointestinal problems, and thus, some patients are prescribed an acid inhibitor, such as proton pump inhibitor (PPI), to be taken with said NSAID.  However, even this combination therapy may be problematic.  That is, if the PPI has not taken affect before the administration of the NSAID then gastrointestinal problems may still occur. 

The U.S. Patent Nos. 6,926,907 (hereinafter “the ‘907 patent”) and 8,557,285 (hereinafter “the ’285 patent”) are directed towards a coordinated release drug formulation comprising an acid inhibitor/PPI and a NSAID.  The coordinated release drug allows for an acid inhibitor to work before the release of the NSAID and thereby minimizes potential gastrointestinal problems.  The ‘285 patent is a related patent of the ‘907 patent and both share a specification.  Claim 1 of the ‘907 patent and claim 1 of the ‘285 patent are presented below:

Claim 1 of the ’907 patent:

1. A pharmaceutical composition in unit dosage form suitable for oral administration to a patient, comprising:

(a) an acid inhibitor present in an amount effective to raise the gastric pH of said patient to at least 3.5 upon the administration of one or more of said unit dosage forms;

(b) a non-steroidal anti-inflammatory drug (NSAID) in an amount effective to reduce or eliminate pain or inflammation in said patient upon administration of one or more of said unit dosage forms;

and wherein said unit dosage form provides for coordinated release such that:

i) said NSAID is surrounded by a coating that, upon ingestion of said unit dosage form by said patient, prevents the release of essentially any NSAID from said dosage form unless the pH of the surrounding medium is 3.5 or higher;

ii) at least a portion of said acid inhibitor is not surrounded by an enteric coating and, upon ingestion of said unit dosage form by said patient, is released regardless of whether the pH of the surrounding medium is below 3.5 or above 3.5.

(emphasis added)

Claim 1 of the ’285 patent:

1. A pharmaceutical composition in unit dosage form comprising therapeutically effective amounts of:

(a) esomeprazole, wherein at least a portion of said esomeprazole is not surrounded by an enteric coating; and

(b) naproxen surrounded by a coating that inhibits its release from said unit dosage form unless said dosage form is in a medium with a pH of 3.5 or higher;

wherein said unit dosage form provides for release of said esomeprazole such that upon introduction of said unit dosage form into a medium, at least a portion of said esomeprazole is released regardless of the pH of the medium.

(emphasis added)

Nuvo, who owns the ‘907 and ‘285 patents, make and sells Vimovo, which is the commercial embodiment of the patents.  The patented drug achieves a coordinated release of the acid inhibitor and the NSAID in a single tablet. The core of the tablet is NSAID, which is coated so as to prevent its release before the pH has increased to a desired level, and an acid inhibitor, like PPI, on the outside of the coating, that actively works to increase the pH to said desired level.  The PPI is uncoated.  The specifications discloses methods for preparing and making the claimed drug formulations and provides examples of the structure and ingredients of the drug formulations but does not disclose any experimental data demonstrating the therapeutic effectiveness of any amount of uncoated PPI and coated NSAID in a single dosage form.  Id. at 6.  The specification discloses that coated PPIs avoid destruction by stomach acid but may not work quickly enough and the specification does not have any disclosure regarding the effectiveness of uncoated PPIs being able to raise pH.  The inventor of the ‘907 and ‘285 patents recognized that an uncoated PPI is at greater risk of being destroyed by stomach acid, which would undermine the effectiveness of the PPI, but contemplated that uncoated PPI would allow for immediate release into a patient’s stomach and achieve an increase in pH level. 

Dr. Reddy’s Laboratories, Inc., Mylan Pharmaceuticals, and Lupin Pharmaceuticals (hereinafter “the Generics”) submitted an Abbreviated New Drug Applications (ANDAs) to the U.S. Food and Drug Administration seeking approval to sell a generic version of Vimovo.  Dr. Reddy’s submitted a second ANDA wherein the product would contain a small amount of uncoated NSAID on the outermost layer of the tablet, which is separate from the coated-core-NSAID.

Nuvo sued the Generics in the U.S. District Court for the District of New Jersey, in order to prevent the Generics from entering the market upon approval of the ANDAs, alleging all ANDAs products would infringe the ‘907 and ‘285 patents.  The Generics stipulated to infringement, except for Dr. Reddy’s second ANDA product, and then countered that the ‘907 and ‘285 patents were invalid for obviousness, lack of enablement and inadequate written description. 

The District Court granted Dr. Reddy’s motion for summary judgment of noninfringment of the ‘907 patent with regards to the second ANDA product.  A bench trail was held regarding the validity of the ‘907 patent, the ‘285 patent, and whether the second ANDA product by Dr. Reddy infringed the ‘285 patent.  It was concluded that the claims were not obvious over the prior art “because it was nonobvious to use a PPI to prevent NSAID-related gastric injury, and persons of ordinary skill in the art were discouraged by the prior art from using uncoated PPI and would not have reasonably expected it to work.”  Id. at 8.  It was also held that the claims of both patents were enabled and there was sufficient written description.  The District Court held that the second ANDA by Dr. Reddy infringes the claims of the ‘285 patent. 

At the District Court, the Generics argued that, “if they lose on their obviousness contention, then the claims lack written description support for the claimed effectiveness of uncoated PPI because ordinarily skilled artisans would not have expected it to work and the specification provides no experimental data or analytical reasoning showing the inventor possessed an effective uncoated PPI.”  Id. at 9.  Nuvo countered that “experimental data and an explanation of why an invention works are not required, the specification adequately describes using uncoated PPI, and its effectiveness is necessarily inherent in the described formulation.”  Id. at 9.  The District Court rejected Nuvo’s argument that effectiveness does not need to be described because effectiveness is inherent.  The District Court acknowledged that the specification of the ‘907 and ‘285 patents did not describe efficacy of uncoated PPI.  However, the District Court did conclude that there was sufficient written description because “the specification described the immediate release of uncoated PPI and the potential disadvantages of coated PPI, namely that enteric-coated PPI sometimes works too slowly to raise the intragastric pH. The district court did not explain why the mere disclosure of immediate release uncoated PPI, coupled with the known disadvantages of coated PPI, is relevant to the therapeutic effectiveness of uncoated PPI, which the patent itself recognized as problematic for efficacy due to its potential for destruction by stomach acid.”  Id. at 10.  The Generics appeal the written description ruling and Nuvo cross-appeals the District Court grant of summary judgment of noninfringement.  Based solely on the written description issue regarding the claim language of “efficacy”, the CAFC reversed the appeal and dismissed the cross-appeal.  

Before the CAFC, the Generics argued that the patents claim uncoated PPI that raises the gastric pH to at least 3.5, but that in view of the District Court’s holding, as part of the obviousness analysis, a skilled artisan would not have expected uncoated PPI to be effective to raise gastric pH, and that the specification of the patents fails to disclose the effectiveness of uncoated PPI.  Id. at 12.  Nuvo argued that “the claims do not require any particular degree of efficacy of the uncoated PPI itself, it is enough that the specification discloses making and using drug formulations containing effective amounts of PPI and NSAID, and experimental data and additional explanations demonstrating the invention works are unnecessary.”  Id. at 12.  The CAFC held that the District Court’s analysis does not support its conclusion of adequate written description and gave a review of the record to establish that the clear error standard has been met. “A written description finding is review for a clear error.” Id. at 11.

First, the CACF rejected Nuvo’s argument that the claims do not recite an efficacy requirement for uncoated PPI.  As noted above, claim 1 of the ‘907 patent discloses “an acid inhibitor present in an amount effective to raise the gastric pH of said patient to at least 3.5” and claim 1 of the ‘285 patent discloses “therapeutically effective amounts of (a) esomeprazole….”  The CAFC held that the claims of both patents require an amount of uncoated PPI effective to raise the gastric pH to at least 3.5.  Id. at 14. Further, the CAFC noted that Nuvo’s argument, which is an attempt to “either recharacterizing the written description dispute or rewriting the claim language”, is being presented for the first time on appeal and is thus forfeited.  The CAFC held that, before the District Court, the parties characterized that “claims require a therapeutically effective amount of uncoated PPI that would raise the gastric pH to at least 3.5”, that this understanding was “a fair reading of the claim language” and this understanding will not be altered in the appeal.  Id. at 16.

Next, Nuvo argued that the expert testimony of Dr. Williams identified four portions of the specification that provided written description support.  The Generics argued that the noted portions only disclose typical dosage amounts of uncoated PPI, the use of uncoated PPI in a drug formulation and did not discuss or explain efficacy of uncoated PPI.  The CAFC agreed with the Generics.  “We have expressly rejected the “argument that the written description requirement … is necessarily met as a matter of law because the claim language appears in ipsis verbis in the specification.” Enzo Biochem, Inc. v. GenProbe Inc., 323 F.3d 956, 968 (Fed. Cir. 2002).”  Id. at 18.  The CAFC noted that the case law does not requirement experimental data to establish effectiveness or an explanation of how or why a claimed composition will be effective.  Id. at 18.  Nevertheless, the CAFC held that the “record evidence demonstrates that a person of ordinary skill in the art would not have known or understood that uncoated PPI is effective.”  Id. at 18.  The CAFC held that the specification is fatally flawed since the “the specification provides nothing more than the mere claim that uncoated PPI might work, even though persons of ordinary skill in the art would not have thought it would work….  It does not demonstrate that the inventor possessed more than a mere wish or hope that uncoated PPI would work, and thus it does not demonstrate that he actually invented what he claimed: an amount of uncoated PPI that is effective to raise the gastric pH to at least 3.5”  Id. at 19.  The inventor’s own testimony confirms this holding.  At trial, the inventor admitted “that he only had a ‘general concept of coordinated delivery with acid inhibition’ using uncoated PPI at the time he filed his first patent application.”  Id. at 19. 

Lastly, Nuvo argued that the written description requirement was satisfied due to the disclosure of how to make and use the claimed invention and accept that therapeutic effectiveness of uncoated PPI is a matter of inherency.  Id. at 20 and 21.  The Generics argued that Nuvo’s assertion did not satisfy written description but would only satisfy the enablement requirement, which is a separate and distinct requirement.  Nuvo cited Alcon Research Ltd. v. Barr Laboratories, Inc., 745 F.3d 1180 (Fed. Cir. 2014) for support but the CAFC quickly dismissed this and noted that the factual circumstances of Alcon were “markedly different”.  Id. at 22.  In Alcon, the patent reference presented example formulations and disclosed data showing stability testing of the claimed invention.  Further, the CAFC stated that only “under a narrow set circumstance” would inherency satisfy the written description requirement.  Nuvo cited Allergan to support their argument that the claimed efficacy of uncoated PPI is necessarily inherent in the specification’s explicit disclosure of methods for making and using drug formulations containing uncoated PPI.  The CAFC agreed with the Generics that the factual circumstances of Allergan are not applicable to the present case.  In Allergan, the parties did not dispute the therapeutic efficacy of the claimed formulation and the specification in Allergan presented experimental results that established a trend in clinical effectiveness. 

Based on the specific facts of certain cases, it is unnecessary to prove that a claimed pharmaceutical compound actually achieves a certain result. But when the inventor expressly claims that result, our case law provides that that result must be supported by adequate disclosure in the specification. In this case, the inventor chose to claim the therapeutic effectiveness of uncoated PPI, but he did not adequately describe the efficacy of uncoated PPI so as to demonstrate to ordinarily skilled artisans that he possessed and actually invented what he claimed. And the evidence demonstrates that a person of ordinary skill in the art reading the specification would not have otherwise recognized, based on the disclosure of a formulation containing uncoated PPI, that it would be efficacious because he or she would not have expected uncoated PPI to raise gastric pH. Under those facts, the patent claims are invalid for lack of adequate written description pursuant to § 112, ¶ 1.

(emphasis added).  Id. at 24. 

The CAFC holds that the ‘907 patent and the ‘285 patent invalid for lack of adequate written description with regards to the claimed effectiveness of uncoated PPI.  The CAFC did not address the other issues on appeal and cross-appeal. 

Takeaway

  • Before filing an application, one may consider identifying the written description support in the specification for each individual feature of a claim  
    • Given the narrow set of circumstances, try not to rely upon inherency to satisfy written description
  • If possible, include experimental data of drug formulations
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