Less Heightened Standard for the Nexus Requirement regarding the Licenses Offered as Objective Indicia of Nonobviousness
Sung-Hoon Kim | June 18, 2025
Case Name: ANCORA TECHNOLOGIES, INC. v. ROKU, INC., VIZIO, INC., NINTENDO CO., LTD., NINTENDO OF AMERICA INC.
Date of Decision: June 16, 2025
Panel: Lourie (author), Reyna, and Hughes
Summary:
The CAFC held that unlike products, actual licenses to the subject patent do not demand the same heightened standard as products. The CAFC held that licenses to the challenged patent do not require a nexus with respect to the specific claims at issue, and that nexus case law does not require that a particular patent be the only patent being licensed or the sole motivation for entering into a license. Therefore, the CAFC vacated and remanded for the PTAB to reconsider the nexus requirement regarding the licenses offered as objective indicia of nonobviousness for Ancora’s patent.
Details:
Ancora owns U.S. Patent No. 6,411,941 (“’941 patent), which is directed to the restriction of unauthorized use of licensed software programs on computers by preventing hackers from copying a software program that was licensed for use on a computer.
This patent describes a method of restricting use of a licensed software program on a computer that has at least two “non-volatile memory areas” (inside BIOS module) and one volatile area.
At issue are claims 1-3, 6-14, and 16 of the ’941 patent, and claim 1 is an independent claim. Independent claim 1 reads:
1. A method of restricting software operation within a license for use with a computer including an erasable, non-volatile memory area of a BIOS of the computer, and a volatile memory area; the method comprising the steps of:
selecting a program residing in the volatile memory,
using an agent to set up a verification structure in the erasable, non-volatile memory of the BIOS, the verification structure accommodating data that includes at least one license record,
verifying the program using at least the verification structure from the erasable non-volatile memory of the BIOS, and
acting on the program according to the verification.
PTAB
In 2021, Nintendo Co., Ltd. and Nintendo of America, Inc. (collectively, “Nintendo”) and Roku, Inc. and VIZIO, Inc. (collectively, “Roku”) filed petitions for IPR of the ’941 patent.
In 2023, the PTAB issued two final written decisions finding that claims 1-3, 6-14, and 16 are unpatentable as obvious over Hellman, Chou, and a third prior art.
In each decision, the PTAB construed the claim term “agent” as “a software program or routine.” Based on this construction, the PTAB determined that the challenged claims of the ’941 patent are unpatentable as obvious.
Ancora appealed both decisions.
CAFC
Ancora raised three issues on appeal.
First, Ancora argued that the PTAB erred in construing the claim term “agent.”
Second, Ancora argued that, even if the PTAB correctly construed the term “agent,” the PTAB nonetheless erred in determining obviousness under 35 U.S.C. § 103 based on a combination of Hellman and Chou.
Third, Ancora argued that the PTAB erred in its analysis of secondary considerations of nonobviousness.
With regard to the first issue, Ancora argued that the “agent” should be construed as a software program or routine limited to use at the OS-level and that excludes hardware.
However, the CAFC disagreed with Ancora’s argument because neither the patent nor prosecution history provide a clear disclaimer that “agent” must be limited to exclude hardware.
With regard to the second issue, Ancora argued that (i) the combination of Hellman and Chou is inoperable; (ii) the PTAB’s determination of obviousness based on this combination is erroneous because a person of ordinary skill in the art would not be motivated to combine their teachings because they are redundant; and (iii) the PTAB’s determination of obviousness is also erroneous because Hellman’s memory address H is not a “verification structure.”
However, the CAFC disagreed with Ancora’s arguments.
With regard to the third issue, the PTAB determined that Ancora failed to establish a sufficient nexus between the claimed invention and evidence of two objective indicia of nonobviousness: industry praise and licensing.
Nexus: “[T]o be accorded substantial weight in the obviousness analysis, the evidence of secondary considerations must have a ‘nexus’ to the claims, i.e., there must be a legally and factually sufficient connection between the evidence and the patented invention.” Henny Penny Corp. v. Frymaster LLC, 938 F.3d 1324, 1332 (Fed. Cir. 2019)
With regard to industry praise, the PTAB considered Ancora’s evidence of a “joint press release” from American Megatrends Inc. (“AMI”) and Ancora that directly named the ’941 patent, and an agreement, in which AMI would offer products using the patent.
After reviewing this industry praise, the PTAB found that this praise was directed to “more broadly to the ’941 patent itself,” but not specifically to “the challenged claims.”
The CAFC agreed with the PTAB’s determination and held that the PTAB did not clearly err in finding that Ancora did not link up their products to the challenged claims.
With regard to licensing, the PTAB found that Ancora failed to show a nexus between the challenged claims and two licenses[1] that Ancora entered into with other parties during settlements in other cases. Also, the PTAB did not consider a third license, which Ancora entered into with another party during settlement.
This time, the CAFC agreed with Ancora because the PTAB incorrectly applied a strict nexus standard for license evidence.
The CAFC held that unlike products, actual licenses to the subject patent do not demand the same heightened standard as products. In other words, the CAFC held that licenses to the challenged patent do not require a nexus with respect to the specific claims at issue, and that nexus case law does not require that a particular patent be the only patent being licensed or the sole motivation for entering into a license.
Therefore, the CAFC held that the PTAB applied an improperly heightened nexus standard and concluded that the PTAB’s findings constituted legal error and were not supported by substantial evidence.
Accordingly, the CAFC vacated and remanded for the PTAB to reconsider the nexus requirement regarding the licenses offered as objective indicia of nonobviousness.
Takeaway:
- Unlike products, actual licenses to the subject patent do not demand the same heightened standard as products with regard to the nexus requirement regarding the licenses offered as objective indicia of nonobviousness.
- In other words, the licenses to the challenged patent do not require a nexus with respect to the specific claims at issue, and that nexus case law does not require that a particular patent be the only patent being licensed or the sole motivation for entering into a license.
[1] The ’941 patent was the only patent identified in the first license agreement.
Federal Circuit’s Question of First Impression on the Patent Eligibility of Machine Learning
John Kong | May 22, 2025
Case Name: : Recentive Analytics, Inc. v. Fox Corp.
Date of Decision: April 18, 2025
Before: Dyk, Prost, Goldberg
Summary:
In this precedential opinion, the Federal Circuit addressed “a question of first impression: whether claims that do no more than apply established methods of machine learning to a new data environment are patent eligible.” The court held that claiming the application of generic machine learning techniques in a new environment or new field of use, without specific improvements to the machine learning techniques or models themselves, is not patent eligible subject matter.
Procedural History:
Recentive sued Fox for patent infringement. The district court granted Fox’s motion to dismiss the case for failure to state a claim due to the patents being ineligible under 35 USC §101. Recentive appealed.
Background:
Recentive asserted two groups of patents. One group of “Machine Learning Training” patents include USP Nos. 11,386,367, 11,537,960. Another group of “Network Map” patents include USP Nos. 10,911,811 and 10,958,957.
Claim 1 of the ‘367 patent below is representative of the Machine Learning Training patents.
1. A computer-implemented method of dynamically generating an event schedule, the method comprising:
receiving one or more event parameters for series of live events, wherein the one or more event parameters comprise at least one of venue availability, venue locations, proposed ticket prices, performer fees, venue fees, scheduled performances by one or more performers, or any combination thereof;
receiving one or more event target features associated with the series of live events, wherein the one or more event target features comprise at least one of event attendance, event profit, event revenue, event expenses, or any combination thereof;
providing the one or more event parameters and the one or more event target features to a machine learning (ML) model, wherein the ML model is at least one of a neural network ML model and a support vector ML model;
iteratively training the ML model to identify relationships between different event parameters and the one or more event target features using historical data corresponding to one or more previous series of live events, wherein such iterative training improves the accuracy of the ML model;
receiving, from a user, one or more user-specific event parameters for a future series of live events to be held in a plurality of geographic regions;
receiving, from the user, one or more user-specific event weights representing one or more prioritized event target features associated with the future series of live events;
providing the one or more user-specific event parameters and the one or more user-specific event weights to the trained ML model;
generating, via the trained ML model, a schedule for the future series of live events that is optimized relative to the one or more prioritized event target features;
detecting a real-time change to the one or more user-specific event parameters;
providing the real-time change to the trained ML model to improve the accuracy of the trained ML model; and
updating, via the trained ML model, the schedule for the future series of live events such that the schedule remains optimized relative to the one or more prioritized event target features in view of the real-time change to the one or more user-specific event parameters.
The Machine Learning Training patents relate to the scheduling of live events and involve “the unique application of machine learning to generate customized algorithms, based on training the machine learning model, that can then be used to automatically create … event schedules that are updated in real-time.”
Claim 1 of the ‘811 patent below is representative of the Network Map patents.
1. A computer-implemented method for dynamically generating a network map, the method comprising:
receiving a schedule for a first plurality of live events scheduled to start at a first time and a second plurality of live events scheduled to start at a second time;
generating, based on the schedule, a network map mapping the first plurality of live events and the second plurality of live events to a plurality of television stations for a plurality of cities,
wherein each station from the plurality of stations corresponds to a respective city from the plurality of cities,
wherein the network map identifies for each station (i) a first live event from the first plurality of live events that will be displayed at the first time and (ii) a second live event from the second plurality of live events that will be displayed at the second time, and
wherein generating the network map comprises using a machine learning technique to optimize an overall television rating across the first plurality of live events and the second plurality of live events;
automatically updating the network map on demand and in real time based on a change to at least one of (i) the schedule and (ii) underlying criteria,
wherein updating the network map comprises updating the mapping of the first plurality of live events and the second plurality of live events to the plurality of television stations; and
using the network map to determine for each station (i) the first live event from the first plurality of live events that will be displayed at the first time and (ii) the second live event from the second plurality of live events that will be displayed at the second time.
The Network Map patents relate to the creation of network maps for broadcasters, which, prior to computers, was done by humans to determine the types of content to be displayed on particular channels at various times. The Network Map patents use training data and user-provided target features, such as overall ratings for the NFL for particular stations, markets, or audience, to generate optimized network maps.
However, Recentive acknowledged that they do not claim the machine learning technique itself and that any machine learning technique may be employed. Rather, the claims use iterative training on its machine learning model with “different event parameters and … event target features” provided by users to “identify relationships within the data.” But, Recentive also acknowledged that “[t]he process of training the machine learning model[] … is required for any machine learning model” “and then the algorithm is actually updated and improved over time based on the input” or training.
Under Alice Step 1, the district court found that the patents were “directed to the abstract ideas of producing network maps and event schedules… using known generic mathematical techniques.” Under Alice Step 2, the claims are not directed to any inventive concept “because the machine learning limitations were no more than ‘broad, functionally described, well-known techniques.’”
Decision:
At Alice step 1, the court examines the “focus of the claimed advance over the prior art.” Here, by Recentive’s own representations, iterative training or dynamic adjustment based on real-time user-specified parameters are “incident to the very nature of machine learning.” Recentive argues that its claims “unearth ‘useful patterns’ that had previously been buried in the data, unrecognizable to humans.” However, Recentive itself acknowledged that its patents do not claim any specific improvements in mathematical algorithms used or improvements to the machine learning itself. Neither does the specification describe any improvements in machine learning. The court did not find any “specific implementation of a solution to a problem in the software arts.” Instead, the court found that “the only thing the claims disclose about the use of machine learning is that machine learning is used in a new environment…event scheduling and the creation of network maps.” And, the court had long recognized that “[a]n abstract idea does not become nonabstract by limiting the invention to a particular field of use or technological environment.”
At Alice step 2, the court did not find any “inventive concept” that would amount to something “significantly more” than the abstract idea itself of generating event schedules and network maps through application of machine learning.
Nevertheless, the court acknowledged that “machine learning is a burgeoning and increasingly important field and may lead to patent-eligible improvements in technology.” But, it concludes that “we hold only that patents that do no more than claim the application of generic machine learning to new data environments, without disclosing improvements to the machine learning models to be applied, are patent ineligible under §101.”
Takeaways:
The court’s decision in this “question of first impression” comes as no surprise. Just using machine learning, or for that matter, any other “tool” of artificial intelligence, such as neural networks, AI models, etc., “in new data environments” is not enough to confer patent eligibility. There must be some claimed and disclosed “improvement” in “software arts” or some other technology.
This decision aligns with the recent USPTO AI examples issued July 2024. For instance, USPTO Example 47, claim 2 and Example 48 were ineligible because the mere “use of” a neural network or trained model is just the mere use of a tool/computer, a general link to a technical field, a mere “apply it” feature – all of which are not meaningful limitations for Alice steps 1 and 2 (as reflected in the USPTO Step 2A, Prong 2 and Step 2B analysis in these examples).
Of more interest is the follow-up exploration into the boundaries of patent eligibility for the “improvements” in such AI-related fields. The July 2024 USPTO AI Examples provided some examples for eligible AI-related subject matter where features in a specific technological field are used/impacted/created via the use of the neural network or trained model that leads to some improvement in that specific technological field. This included USPTO Example 47 claim 3’s dropping of potentially malicious packets and blocking of future traffic from the detected source address, which reflected an improvement in the technical field of network intrusion detection by using the information (source address of malicious packets) to enhance security by taking claimed proactive measures to remediate the danger. Other examples of eligible claims reciting AI features leading to improvements in some underlying technology include USPTO Example 48, claims 2 and 3 (speech signal processing). Of course, these are clear cut examples of eligible AI subject matter. We hope to see more Federal Circuit decisions addressing the more grey areas involving AI techniques.
For instance, Recentive tried to argue that that its claims “unearth ‘useful patterns’ that had previously been buried in the data, unrecognizable to humans.” Recentive also focused on the claimed iterative training as conferring patent eligibility. Perhaps an argument could be made that a specific new way for how to train the machine learning model using selected specific data improved the iterative training procedure that would otherwise apply using existing techniques. This, of course, would require a carefully drafted specification spelling out what an existing iterative training might entail, and then, how this new iterative training would improve the accuracy of the model. Again, what does the specification say about the “focus of the claimed advance over the prior art?” If the “focus” is on the new way to perform the iterative training, perhaps the claims might have survived §101.
This is also reminiscent of USPTO Example 39, reciting the creation of first and second training sets and the training of a neural network in first and second stages with those respective training sets. USPTO Example 39 is an example of an eligible claim involving the training of a neural network for facial detection. One key aspect of Example 39 is that it described how prior methods of facial detection using neural networks suffered from an inability to robustly detect human faces in images when the NN was trained with a set of facial and non-facial images. Example 39, instead, focused on expanded training sets of facial images. Under USPTO Step 2A, Prong 1, the “training” in USPTO Example 39 was simply deemed not to fall into any judicial exception category and the claim was deemed patent eligible because no judicial exception was recited.
Contrast, however, with USPTO Example 47, claim 2, where “training” was deemed to fall into the category of math, and the claim was deemed ineligible. One distinction between these two examples is that USPTO Example 39 focused on “how” the “training” led to improvements over the prior training techniques. Such a focus did not exist in Recentive’s case. But, when it is the first time applying AI in “a new data environment,” a next question might be whether there is a way to describe deficiencies in using existing training techniques that would be overcome with newly created sets of training data or a new specific way of changing existing training procedures to improve a desired outcome. This is just one example of a grey area where more Federal Circuit decisions on eligibility would be helpful. Nevertheless, the guidance is clear – spell out the “improvement” in technology in the specification and claim the features that result in that improvement.
Indefiniteness and Means-Plus-Function: Fintiv v. PayPal
Bo Xiao | May 7, 2025
Case Name: FINTIV, INC., v. PAYPAL HOLDINGS, INC.
Decided: : April 30, 2025
Before: PROST, TARANTO, and STARK, Circuit Judges.
Summary
The Federal Circuit affirmed the Western District of Texas’s ruling that invalidated Fintiv, Inc.’s asserted claims against PayPal Holdings, Inc. on the basis of indefiniteness under 35 U.S.C. § 112 ¶ 6. The court held that Fintiv’s “payment handler” claim terms lacked sufficient structural disclosure and were therefore indefinite.
Background
Fintiv sued PayPal for patent infringement, asserting U.S. Patent Nos. 9,892,386; 11,120,413; 9,208,488; and 10,438,196. These patents relate to cloud-based transaction systems, described variously as “mobile wallet platforms” or “electronic payment systems.” The claims at issue recited a “payment handler” or “payment handler service” configured to use APIs of various payment processors or to expose a common API for interacting with them.
The ’386 and ’413 patents share a common specification, as do the ’488 and ’196 patents. The specifications of all four asserted patents are substantially similar. The key terms at issue in the case are the “payment handler” terms. These terms appear in the asserted claims as follows:
- ’386 patent, claims 1–3:
“a payment handler service operable to use [application programming interfaces (“APIs”)] of different payment processors including one or more APIs of banks, credit and debit cards processors, bill payment processors.” - ’413 patent, claim 1 (and similarly in claim 2):
“a payment handler configured to use APIs of different payment processors including one or more APIs of banks, credit and debit cards processors, and bill payment processors.” - ’488 patent, claim 1, and ’196 patent, claim 1:
“a payment handler that exposes a common API for interacting with different payment processors.”
After claim construction, the district court concluded that the “payment handler” terms were means-plus-function terms invoking § 112 ¶ 6 (pre-AIA, now § 112(f) in the AIA), and that the patents failed to disclose sufficient corresponding structures. All four patents are based on two provisional applications filed in 2011, and therefore fall under pre-AIA. The court held the claims indefinite and entered final judgment. Fintiv appealed.
Discussion
The central issue was whether the “payment handler” terms invoked § 112 ¶ 6. Although the claims did not use the word “means,” the district court held that the terms described functions without reciting sufficient structure. It found that words like “handler” and “service” were merely generic labels akin to the term “module.” The court emphasized that the surrounding claim language, including terms like “operable to” and “configured to,” described functions without imparting structure.
Fintiv argued that the term “payment handler” would be recognized by a person of ordinary skill in the art (POSA) as referring to a known type of structure, citing examples such as the Internet Open Trading Protocol (IOTP). Although Fintiv presented this as evidence of structural meaning, the court agreed with the district court and found that the term “handler” alone, and the “payment handler” terms as a whole, do not provide any structure for performing the claimed functions.
Fintiv also argued that the claim language defines the inputs, outputs, and operation of the payment handler. However, the court found that the claims and the specification, including the figures, do not provide sufficiently definite structure for the inputs, outputs, connections, or operation of the payment handler. Instead, the specification merely repeats the claim language without offering additional technical detail.
After determining that the payment handler terms were subject to § 112 ¶ 6, the court examined whether the patents disclosed corresponding structure for performing the claimed functions. Both the district court and the Federal Circuit found that the patents repeated the functional claim language without explaining how the functions were actually implemented.
Fintiv contended that the patents described a two-step algorithm: wrapping APIs and exposing a common API. The court rejected this, concluding that these so-called steps were nothing more than functional restatements and lacked the specificity required to inform a POSA how to perform the claimed functions. Without a disclosed algorithm or identifiable structure, the claims were held indefinite.
Technical Commentary
This case sets a high bar for software related patent applications, which would impose stringent requirements for disclosing functional models that serve specific design roles within a system. The court found the “payment handler” terms indefinite due to a lack of structural disclosure; however, this conclusion might be open to technical debate from a computer science perspective.
“Payment handler” alone may appear generic, but when tied to APIs as described in the claims, it might not be merely generic. Instead, it may reflect a specific design pattern commonly used in software architecture for implementing a handler component. In computer science, the use of APIs to abstract and manage interactions with multiple external systems is a well-known and standardized design pattern. The concept of “wrapping” APIs to unify interfaces across various systems has been widely practiced since at least the early 2000s. An API focuses on how code is organized and modularized, not on how internal tasks are executed algorithmically.
Courts have emphasized that when a general purpose processor performs a claimed function, the patent must disclose the underlying algorithm. However, in many software systems, APIs are part of a broader architectural design. When the API’s behavior is well-understood or supported by flowcharts or system diagrams showing data flows, this combination can be sufficient to convey structure for the system.
In this case, the court found the specification and figures insufficient to support the “payment handler” terms. However, the ’413 patent includes 23 interaction diagrams (Figs. 20A–22J), all illustrating interactions involving the payment handler. These figures provide multiple examples showing how the payment handler receives inputs and passes outputs. When read in context, the diagrams function as a software design guide that outlines system behavior and integration of modular components.
The claims are directed to a system, and within that system, the API is a defined component that plays its role in structuring and enabling its functionality. In this context, the API itself serves as a structural component of the overall system.
Expecting the specification to disclose an algorithm for such a structural component may not reflect how software systems are typically designed or understood by those skilled in the art. If a detailed claim analysis were to show that the system can perform its essential inventive function without requiring an algorithmic disclosure for the API, it would be arguable whether the term “payment handler” should be deemed indefinite.
Takeaways
- If a software claim recites only functional terms without disclosing how the function is performed, it may be at risk of being found indefinite for lack of supporting structure.
CAFC Affirms Prosecution Disclaimer and Non-Infringement in ANDA Case
Fumika Ogawa | April 23, 2025
Case Name: AZURITY PHARMACEUTICALS, INC. v. ALKEM LABORATORIES LTD.
Decided: April 8, 2025
Before: MOORE, Chief Judge, CHEN, Circuit Judge, and MURPHY, District Judge. Opinion by Murphy.
Summary
The CAFC affirmed prosecution disclaimer and non-infringement in ANDA litigation, where the patentee’s sweeping disclaimer in the patent’s parent application applies to the continuation patent claims, despite the patentee’s belated efforts to take back disclaimer statements in a later, related application and to revise the scope of disclaimer to exclude the ANDA product.
Details
Azurity sued Alkem in the district court for an ANDA-induced infringement of certain claims of Azurity’s U.S. Patent No. 10,959,948 (“the ’948 patent”), directed to liquid vancomycin formulations for oral administration. The asserted claims use a close-ended “consisting of” transition and do not list propylene glycol, whereas Alkem’s ANDA product contains propylene glycol both as a co-solvent and as a component of the grape flavoring agent.
The district court found non-infringement where Alkem’s ANDA product contained propylene glycol, and Azurity, through prosecution history, had disclaimed any presence of propylene glycol from the patented formulations, with the disclaimer not overcome by certain language in the parties’ pretrial stipulation. At issue in the appeal are: (1) whether there was a clear and unmistakable disclaimer, (2) whether the stipulation precluded such disclaimer, and (3) whether the district court erred in finding no infringement. The CAFC addressed the issues in turn.
- Prosecution disclaimer
The CAFC went through prosecution history of Azurity’s relevant patent family.
The ’948 patent issued from application No. 16/941,400 (“the ’400 application”), which is a continuation of application No. 15/126,059 (“the ’059 application”). The ’059 application had been repeatedly rejected over a prior art reference Palepu which disclosed “a polar solvent including propylene glycol.” Throughout the prosecution, Azurity had made repeated attempts, through amendments and remarks, to distinguish over Palepu based on the absence of propylene glycol in the claimed invention.
Specifically, Azurity initially sought distinction using a negative limitation in some claims such as “wherein the oral liquid solution does not comprise a propylene glycol,” or introducing the close-ended “consisting of” language in other claims, such as “[a] liquid solution comprising a carrier consisting of” certain ingredients excepting propylene glycol. Both approaches failed as the Examiner found the negative limitation as lacking written description and the “consisting of” limitation with the preceding “comprising” transition as being indefinite. The §112 issues eventually forced Azurity to adopt the close-ended transition “consisting of” excluding unrecited propylene glycol from the claimed formulation, an amendment which led to allowance of the ’059 application. The claim amendments were accompanied by applicant’s repeated arguments, including a Rule 132 declaration by Azurity’s officer, emphasizing the claims’ lack of propylene glycol as a key distinction over Palelu. The Examiner expressly allowed the claims based on this exclusion.
The “consisting of” transition omitting propylene glycol was inherited by the ’400 application, which was allowed without rejection and resulted in the ’948 patent claims. For example, representative claim 5 recites a liquid formulation “consisting of: a buffering agent [selected from a recited group of buffering agents], water, a sweetener, a preservative [selected from a recited group of preservatives], vancomycin hydrochloride, and flavoring agent” (emphasis added), along with certain properties of the formulation.
Aside from the ’059 application, Azurity’s patent family includes No. 16/892,421 (“the ’421 application”)—the ’400 application’s grand-nephew claiming priority from the ’059 application. In the ’421 application, Azurity—after Alkem’s submission of Paragraph IV notice letter—apparently attempted to retract the disclaimer by stating: “For the record, Applicant did not disclaim propylene glycol when submitting the arguments in [the ’059 application], and reserves the right to claim propylene glycol in the instant and future cases in this patent family.”
Based upon the prosecution history, the CAFC found that Azurity clearly and unmistakably disclaimed any presence of propylene glycol from the ’948 patent. The CAFC was unpersuaded by Azurity’s non-disclaimer arguments including: (a) its “for the record” remarks made in the ’421 application are also relevant to the disclaimer analysis; and (b) the disclaimer of propylene glycol applies only to “the carrier” and not to “the flavoring agent.”
As for the “for the record” argument, the CAFC distinguished over the precedents where statements in the prosecution histories of patents from a common ancestor application may be relevant for claim interpretation in the related, later-issued patents. Here, the ’421 application and the ’400 application were prosecuted in parallel; there is no direct lineage from the ’421 application to the ’400 application; and the remarks at issue post-dated allowance of the asserted patent. To be consistent with the public notice function of the prosecution history, Azurity is barred from recanting its earlier disclaimer by the later, unilateral statement in the related application.
As for the “carrier” distinction, the CAFC pointed to the ’059 prosecution history where Azurity abandoned the “solution comprising a carrier consisting of” limitation in favor of the “consisting of” transition. While the CAFC acknowledged Azurity’s current argument that Palepu disclosed propylene glycol “only as a carrier” as opposed to a flavoring agent, such a distinction was never made during prosecution. “Just as the echo matches the shout,” the CAFC noted that the disclaimer scope is defined by the arguments as made, not as later refined.
- Pretrial stipulation
Azurity contended that a joint pretrial stipulation—stating that “suitable flavoring agents for use in the Asserted Claims include flavoring agents with or without propylene glycol”—precluded the application of the disclaimer. To Azurity, the stipulation would define the scope of “infringing flavoring agents” so that Alkem—with its product containing propylene glycol as part of the flavoring agent—could not rely on the disclaimer of propylene glycol, whereas Alkem argued that the stipulation was to simply clarify the general scope of the relevant flavoring agents in the field.
The CAFC sided with Alkem for several reasons. First, Azurity’s interpretation conflicted with another part of the stipulation stating that “Alkem does not dispute infringement except that it ‘contends that it does not infringe the Asserted Claims due to [the] presence of propylene glycol in Alkem’s ANDA Products.” Second, the disputed stipulation is set forth in a manner different from the rest of the undisputed facts each of which refers to meeting a limitation of any claim. Third, the disputed stipulation originated from Azurity’s concession over claim construction, admitting “that the plain and ordinary meaning of the claim term ‘flavoring agent’ includes flavoring agents without propylene glycol.” Based on the circumstances, the CAFC concluded that the stipulation does not preclude the disclaimer.
- The district court’s finding of non-infringement
After affirming the prosecution disclaimer and the pretrial stipulation, the CAFC found no error in the district court’s finding of non-infringement. The CAFC indicated that the existence of the prosecution history was a decisive factor. Absent the comprehensive disclaimer of any propylene glycol—either as an individual ingredient or as a concomitant of flavoring agent—Azurity may have had a colorable argument that propylene glycol would affect the flavoring of the product, and that propylene glycol and grape flavoring—both included in Alkem’s ANDA product—collectively are a flavoring agent, so as to read on the claimed “flavoring agent” while concurrently meeting the exclusion of “propylene glycol.” But the disclaimer precluded such a position.
Takeaways
This case underscores the lasting impact of prosecution history on claim scope, from an ancestor application to its descendent patent. Applicant cannot walk back a disclaimer in later, related applications—particularly those not in direct lineage. Also, in distinguishing prior art, care must be taken to avoid a broad, sweeping argument which could unknowingly over-restrict the claim scope to assert infringement.
