Case Summary : CAFC Alert

The disclosure-dedication doctrine applies at limitation level, not at embodiment level

| May 27, 2020

Eagle Pharmaceutical Inc. v. Slayback Pharm LLC

May 8, 2020

O’Malley (Opinion author), Reyna, and Chen

Summary
The Federal Circuit affirmed the district court’s holding that the disclosure-dedication doctrine applies here to bar application of the doctrine of equivalents and, accordingly, the Slayback’s generic products do not infringe the Eagle’s four patents.
Details
Slayback filed new drug application (“NDA”) for a generic version of Eagle’s branded bendamustine product, BELRAPZO®. Bendamustine is used to treat chronic lymphocytic leukemia and indolent B-cell non-Hodgkin lymphoma. Eagle sued Slayback for infringing four patents in the District Court for the District of Delaware. Eagle’s four asserted patents share essentially the same written description. One of the four patents is U.S. Patent No. 9,572,796 (“the ’796 patent”), which has a representative claim 1 as shown below:

1. A non-aqueous liquid composition comprising: bendamustine, or a pharmaceutically acceptable salt thereof;
a pharmaceutically acceptable fluid comprising a mixture of polyethylene glycol and propylene glycol, wherein the ratio of polyethylene glycol to propylene glycol in the pharmaceutically acceptable fluid is from about 95:5 to about 50:50; and
a stabilizing amount of an antioxidant;
. . . .

In the district court, Slayback conceded that its generic product literally infringes all limitations of claim 1 except for the “pharmaceutically acceptable fluid” limitation. Slayback uses ethanol instead of propylene glycol (PG) in its generic product. Eagle argued that the ethanol in Slayback’s product is insubstantially different from the propylene PG in the claimed composition and, accordingly, Slayback’s product infringes under the doctrine of equivalents.
Slayback moved for a judgment of non-infringement on the pleadings under Federal Rule of Civil Procedure 12(c). Slayback argued that the disclosure-dedication doctrine barred Eagle’s claim of infringement under the doctrine of equivalents because the asserted patents disclose, but do not claim, ethanol as an alternative solvent to PG. Eagle counter-argued that the disclosure-dedication doctrine does not apply here because the asserted patents do not disclose ethanol as an alternative to PG for the claimed embodiment that contains an antioxidant. In fact, the specification only discloses ethanol when discussing unclaimed embodiments that contain chloride salt. Specifically, the asserted patents disclose three distinct “categories” of bendamustine formulations: (i) chloride salt formulations; (ii) antioxidant formulations; and (iii) dimethyl sulfoxide (“DMSO”) formulations. The specification only discloses ethanol as an alternative to PG when discussing the unclaimed chloride salt formulations; and it never discloses ethanol as an alternative to PG when discussing the claimed antioxidant formulations. Eagle also submitted an expert declaration from Dr. Mansoor Amiji in support of its opposition. Nevertheless, the district court held for Slayback because the asserted specification expressly and repeatedly identifies “ethanol” as an alternative “pharmaceutically acceptable fluid” to PG.
The federal circuit affirms the district court’s holding. The disclosure-dedication doctrine does not require the specification to disclose the allegedly dedicated subject matter in an embodiment that exactly matches the claimed embodiment. Instead, the disclosure-dedication doctrine requires only that the specification disclose the unclaimed matter as an alternative to the relevant claim limitation. That is, the disclosure-dedication doctrine requires disclosure of alternatives only at limitation level, not at embodiment level. In this case, the asserted patents disclose ethanol as an alternative to PG in the “pharmaceutically acceptable fluid” claim limitation. The specification repeatedly identifies—without qualification—ethanol as an alternative pharmaceutically acceptable fluid. Aside from the description of certain exemplary embodiments, nothing in the specification suggests that these repeated disclosures of ethanol are limited to certain formulations, or that they cannot extend to the claimed formulation.
Eagle also challenges the district court’s decision from the procedural grounds. Eagle argues that the district court erred by resolving that factual dispute at the pleading’s stage without drawing all reasonable inferences in Eagle’s favor. The federal circuit held that the district court has discretion to consider evidence outside the complaint for purposes of deciding whether to accept that evidence and convert the motion into one for summary judgment. In this case, the district court decided that Eagle was trying to fabricate a factual dispute and Slayback is entitled to judgment in its favor as a matter of law.

Take away

  1. The disclosure-dedication doctrine applies at limitation level, not at embodiment level.
  2. A patent drafter should be careful that the scopes of claims are consistent with the disclosure of specification to avoid inadvertent disclosure-dedication.

PETITION DENIED: AI MACHINE CANNOT BE LISTED AS AN INVENTOR

| May 21, 2020

In re Application of Application No. 16/524,350 (“Devices and Methods for Attracting Enhanced Attention”)

April 27, 2020

Robert W. Bahr (Deputy Commissioner for Patent Examination Policy)

Summary:

The PTO denied a petition to vacate a Notice to File Missing Parts of Nonprovisional Application because an AI machine cannot be listed as an inventor based on the relevant patent statutes, case laws from the Federal Circuit, and the relevant sections in the MPEP.  The PTO did not find the petitioner’s policy arguments persuasive. 

Details:

            This application was filed on July 29, 2019.  Its Application data sheet (ADS) included a single inventor with the given name “DABUS[1]” and the family name “Invention generated by artificial intelligence.”  The ADS identified the Applicant as the Assignee “Stephen L. Thaler.”  Also, a substitute statement (in lieu of declaration) executed by Mr. Thaler was submitted, and an assignment document executed by Mr. Thaler on behalf of both DABUS and himself was submitted.  Finally, an “Inventorship Statement,” which stated that the invention was conceived by “DABUS” and it should be named as the inventor, was also submitted.

            Afterward, the PTO issued a first Notice to File Missing Parts on August 8, 2019, which indicated that the ADS “does not identify each inventor by his or her legal name,” and an surcharge of $80 is due for late submission of the inventor’s oath or declaration.

            Mr. Thaler filed a petition on August 29, 2019, requesting supervisory review of the first Notice. 

            The PTO issued a second Notice to File Missing Parts on December 13, 2019.  The PTO dismissed the petition filed on August 29, 2019 in a decision issued on December 17, 2019.

            Mr. Thaler filed a second petition on January 20, 2020, requesting reconsideration of the decision issued on December 17, 2019.

Relevant Statutes cited by the PTO

            35 U.S.C. §100(f):

The term “inventor” means the individual or, if a joint invention, the individuals collectively who invented or discovered the subject matter of the invention.

            35 U.S.C. §100(g):

The terms “joint inventor” and “coinventor” mean any 1 of the individuals who invented or discovered the subject matter of a joint invention.

            35 U.S.C. §101:

Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.

            35 U.S.C. §115(a):

An application for patent that is filed under section 111 (a) or commences the national stage under section 371 shall include, or be amended to include, the name of the inventor for any invention claimed in the application. Except as otherwise provided in this section, each individual who is the inventor or a joint inventor of a claimed invention in an application for patent shall execute an oath or declaration in connection with the application

            35 U.S.C. §115(b):

An oath or declaration under subsection (a) shall contain statements that … such individual believes himself or herself to be the original inventor or an original joint inventor of a claimed invention in the application.

            35 U.S.C. §115(h)(1):

Any person making a statement required under this section may withdraw, replace, or otherwise correct the statement at any time.

The PTO’s reasoning

            Citing the above statutes, the PTO found that the patent statutes preclude the petitioner’s broad interpretation that an “inventor” could be construed to cover machines.  That is, the PTO asserted that such broad interpretation could contradict the plain reading of the patent statutes.

            The PTO also cited the case law from the Federal Circuit to dismiss the petitioner’s argument.  For example, in Univ. of Utah v. Max-Planck-Gesellschajt zur Forderung der Wissenschajten e. V (734 F.3d 1315 (Fed. Cir. 2013), the CAFC held that a state could not be an inventor.  In Beech Aircraft Corp. v. EDO Corp. (990 F.2d 1237 (Fed. Cir. 1993), the CAFC held that “only natural persons can be ‘inventor.’”

            Furthermore, the PTO cited the relevant sections in the MPEP to support their position.  The PTO indicated that the MPEP defines “conception” as “the complete performance of the mental part of the inventive act” and it is “the formation in the mind of the inventor of a definite and permanent idea of the complete and operative invention as it is thereafter to be applied in practice.”  The PTO asserted that the use of terms such as “mental” and “mind” indicates that conception must be performed by a natural person.

            The PTO rejected the petitioner’s argument that the PTO should take into account the position adopted by the EPO and the UKIPO that DABUS created the invention, but DABUS cannot be named as the inventor.  The PTO indicated that the EPO and the UKIPO are interpreting and enforcing their own laws. 

            The PTO also rejected the petitioner’s argument that inventorship should not be a substantial condition for the grant of patents by arguing that “inventorship has long been a condition for patentability.”  The PTO rejected the notion that the granting of a patent for an invention that covers a machine does not mean that the patent statutes allow that machined to be listed as an inventor in another patent application.

            Finally, the petitioner provided some policy considerations to support his position: (1) this would incentivize innovation using AI systems, (2) would reduce the improper naming of persons as inventor who do not qualify as inventors, and (3) would inform the public of the actual inventors of an invention.  The PTO rejected the petitioner’s policy considerations by arguing that they do not overcome the plain language of the patent statutes. 

Takeaway:

  • At this point, it appears that it is not possible to list an AI machine as an inventor in the U.S. patent applications.  The EPO reached a similar decision in December.  It is known that the Japanese Patent Act and the Korean Patent Act do not include an explicit definition of an inventor.  Also, the Chinese State Council called for “better IP protections to promote AI.”
  • Congress needs to work on this issue because the patent system is in place to incentive innovation in technology, and eventually, increase investment for more jobs.
  • A lack of patent protection for inventions developed by AI would decrease investment in the development and use of AI.
  • However, there is a concern, among other things, that the PTO may not be able to deal with situations where AI created enormous amount of prior arts to be reviewed by the Examiners.
  • Human programmer of AI or the one who defined the task of AI machine could be listed as the named inventor. 

[1] DABUS stands for “Device for Autonomous Bootstrapping of Unified Sentience.”  Mr. Thaler asserts that DABUS is a creativity machine programmed as a series of neural networks that have been trained with general information in the field of endeavor to independently create invention.  In addition, Mr. Thaler asserts that this machine was “not created to solve any particular problem and not trained on any special data relevant to the instant invention.”  Furthermore, Mr. Thaler asserts that this machine recognized “the novelty and salience of the instant invention.”

Patent Term Extension under 35 U.S.C. §156 is Limited to the FDA-Approved Active Ingredient and Salts or Esters thereof—but not Metabolites or Compounds Sharing an Active Moiety

| May 13, 2020

Biogen International GmbH v. Banner Life Sciences

April 21, 2020

Lourie, Moore, and Chen. Opinion by Lourie

Summary

            In a case focusing on the meaning of a “product” under 35 U.S.C. §156, the CAFC concluded that the scope of patent term extension is limited to the FDA-approved active ingredient and salts or ester thereof, and does not more broadly include metabolites or other compounds sharing an active moiety with the approved product.  Thus, the extension of Biogen’s ‘001 patent does not include some other products within the scope of the claims, such as the metabolite MMF.

Details

Background and District Court holding

Biogen is the owner of U.S. Patent No. 7,619,001, which claims a method of treating multiple sclerosis.  Claim 1 is as follows: 

A method of treating multiple sclerosis comprising administering, to a patient in need of treatment for multiple sclerosis, an amount of a pharmaceutical preparation effective for treating multiple sclerosis, the pharmaceutical preparation comprising

at least one excipient or at least one carrier or at least one combination thereof; and

dimethyl fumarate, methyl hydrogen fumarate, or a combination thereof.

Biogen also holds the New Drug Application (NDA) for dimethyl fumarate (DMF).  This was approved by the FDA in 2013 and is marketed as Tecfidera® “for the treatment of patients with relapsing forms of multiple sclerosis” at a dose of 480 mg.

            DMF is a double ester which, upon administration to the patient, metabolizes into monomethyl fumarate (MMF) (another name for the claimed “methyl hydrogen fumarate”).  Both DMF and MMF are illustrated below. 

The ‘001 patent is was originally set to expire on April 1, 2018, but was awarded 818 days of patent term extension to June 20, 2020 under 35 U.S.C. 156 (not to be confused with patent term adjustment under 35 U.S.C. 154).  This compensated Biogen for the FDA review period of Tecfidera.  The question presented to the CAFC is whether MMF is covered by the 818-day PTE extension along with DMF.

            In 2018, Banner filed a “paper NDA” under 21 U.S.C. 355(b)(2) to market a drug having MMF as the active ingredient.  Banner could rely on Biogen’s clinical data to show safety and efficacy, and only had to demonstrate bioequivalence.   Biogen then sued Banner for infringement. 

            In reply, Banner argued that the PTE under §156 was limited to uses including the approved product:  DMF and its salts or esters, and did not include MMF.  The relevant portions of §156 are presented below:

(a) The term of a patent which claims a product, a method of using a product, or a method of manufacturing a product shall be extended in accordance with this section from the original expiration date of the patent, which shall include any patent term adjustment granted under section 154(b),…

(b) Except as provided in subsection (d)(5)(F), the rights derived from any patent the term of which is extended under this section shall during the period during which the term of the patent is extended—….

(2) in the case of a patent which claims a method of using a product, be limited to any use claimed by the patent and approved for the product—

(A) before the expiration of the term of the patent—

(i) under any provision of law under which an applicable regulatory review occurred, and

(ii) under the provision of law under which any regulatory review described in paragraph (1), (4), or (5) of subsection (g) occurred, and

(B) on or after the expiration of the regulatory review period upon which the extension of the patent was based; and….

(f) For purposes of this section:

(1) The term “product” means:

(A) A drug product…..

(2) The term “drug product” means the active ingredient of—

(A) a new drug, antibiotic drug, or human biological product…including any salt or ester of the active ingredient, as a single entity or in combination with another active ingredient.

Meanwhile, Biogen argued that §156(b)(2) does not limit the PTE to uses of the approved product, but rather to all products within the scope of the claim.  Additionally, Biogen argued that “product” of §156 should be more broadly interpreted as any compound that shares the “active moiety” with the approved product.  The district court sided with Banner.

CAFC

            First, the CAFC noted that the purpose of §156 PTE is to compensate a patent owner for regulatory delays, and that this is limited to one patent per approved product.  The court also noted that §156 defines the scope of the product as “the active ingredient of…a new drug…including any salt or ester of the active ingredient.”

Biogen cited Pfizer Inc. v. Dr. Reddy’s Labs, Ltd. 359 F.3d 1361 (Fed. Cir. 2004) to support the position that that “product” under §156 should be interpreted more broadly, especially where “a later applicant’s patentably indistinct drug product…relies on the patentee’s clinical data.”  The CAFC did not accept this argument.  In Pfizer, the question was whether an extension for amlodipine included amlodipine maleate.  However, the CAFC concluded that amlodipine maleate in Pfizer was included under the extension because amlodipine maleate is a salt of the active ingredient (amlodipine), and not because these two compounds share an “active moiety.”  On the other hand, in this case, MMF is not a salt or ester of DMF.  Rather, MMF is a de-esterified form of DMF.  The CAFC’s comments regarding clinical data were provided in Pfizer merely to clarify the purpose of §156(f) and provide context.

The parties also cited to Glaxo Ops. UK Ltd. v. Quigg, 894 F.2d 392 (Fed. Cir. 1990).  However, the CAFC concluded that this case was not pertinent to the present issue.  Glaxo involved an approved product having cerufoxime as its active ingredient and a second approved product having cerufoxime axetil as its active ingredient, cerufoxime axetil being an ester of cerufoxime.  In Glaxo, the question was not whether cerufoxime axetil should be included in an extension for cerufoxime, but rather whether cerufoxime axetil was eligible for its own separate PTE.  Since this is not the issue in the present case, the CAFC side-stepped Glaxo.    

Additionally, Biogen cited to PhotoCure ASA v. Kappos, 603 F.3d 1372 (Fed. Cir. 2004).  In PhotoCure, the CAFC indicated that a new ester could be separately patentable.  However, the CAFC indicated that PhotoCure presented a similar situation as Glaxo:  a separate extension for a new ester.

Thus, the CAFC held that the definition of “product” according to §156 is the “active ingredient ….including any salt or ester of the active ingredient.”  This is not necessarily the same as “active moiety.”  As such, “product” only means the active ingredient designated on the FDA approved label, and changes resulting in a salt or ester.  However, “product” does not include metabolites of the active ingredient, or de-esterified forms thereof.  Here, MMF is a de-esterified metabolite of DMF, rather than a salt of DMF.

Next, Biogen argued that, unlike §156(b)(1), §156(b)(2) does not limit the extension to approved uses of the approved product, but only to approved uses of any approved product.  However, the CAFC dismissed this by holding that the approved product in this case is DMF, not MMF, and that it would not make sense for an extension to apply to a different product for which the NDA holder was never subjected to review.

Finally, Biogen argued that the Banner infringes under the doctrine of the equivalents.  However, the CAFC dismissed this argument on that basis that a product or process cannot logically infringe an extended claim under equivalents if it is statutorily not included in the §156 extension.

Take Away

Unlike patent term adjustment under §154, which covers the full scope of the patent, patent term extension under §156 is limited in scope to a product having the active ingredient granted regulatory approval by the FDA.  The “product” will be narrowly interpreted as the approved active ingredient, as well as salts and esters thereof.  As such, patent term extension under §156 is not so broad to cover metabolites and other compounds which share an active moiety with the approved drug.

Interestingly, this case was decided near in time to an important IPR involving the same drug.  In February, the PTAB sided with Biogen in a challenge to U.S. Patent No. 8,399,514 by Mylan Pharmaceuticals.  The ‘514 patent was very similar to the claims of the ‘001 patent, but recited oral administration and a specific dosage.  The PTAB indicated that the dosage was not obvious from the prior art and thus confirmed the validity of the valuable ‘514 patent.  The ‘514 patent is the last unexpired patent in the family covering Tecfidera, and is set to expire in 2028. 

Additionally, upon the CAFC’s decision, the FDA granted final approval on April 30 to Banner’s MMF-based drug, which will be marketed as Bafiertam ®.

The Federal Circuit declined to be bound by the 2019 Revised Patent Subject Matter Eligibility Guidance by the Patent Office, but affirmed the Board’s conclusion of the ineligibility, which relied on the Guidance

| May 7, 2020

In re Rudy

April 24, 2020

Prost, Chief Judge, O’Malley and Taranto. Court opinion by Prost.

Summary

The Federal Circuit declined to be bound by the 2019 Revised Patent Subject Matter Eligibility Guidance by the Patent Office, and instead followed the Supreme Court’s Alice/Mayo framework, and the Federal Circuit’s interpretation and application thereof. However, the Federal Circuit unanimously affirmed the Board’ affirmance of the Examiner’s rejection of claims 34, 35, 37, 38, 40, and 45–49 of the ’360 application as patent-ineligible under 35 U.S.C. § 101, which was fully relied on the Office Guidance.

Details

I. background

United States Patent Application No. 07/425,360 (“the ’360 application”), filed by Christopher Rudy on October 21, 1989 (before the signing of the 1994 Uruguay Round Agreements Act), is entitled “Eyeless, Knotless, Colorable and/or Translucent/Transparent Fishing Hooks with Associatable Apparatus and Methods.” After a lengthy prosecution of more than twenty years, including numerous amendments and petitions, four Board appeals, and a previous trip to the Federal Circuit where the obviousness of all claims then on appeal was affirmed (In re Rudy, 558 F. App’x. 1011 (Fed. Cir. 2014) (non-precedential)), claim 34, which the Board considered illustrative, reads as follows:

34. A method for fishing comprising steps of

(1) observing clarity of water to be fished to deter- mine whether the water is clear, stained, or muddy,

(2) measuring light transmittance at a depth in the water where a fishing hook is to be placed, and then

(3) selecting a colored or colorless quality of the fishing hook to be used by matching the observed water conditions ((1) and (2)) with a color or colorless quality which has been previously determined to be less attractive under said conditions than has undergone those pointed out by the following correlation for fish-attractive non-fluorescent colors:

The Patent Trial and Appeal Board (“Board”) affirmed the Examiner’s rejection of claims 34, 35, 37, 38, 40, and 45–49 of the ’360 application in the last Board appeal. The Board conducted its analysis under a dual framework for patent eligibility, purporting to apply both 1) “the two-step framework described in Mayo [Collaborative Ser- vices v. Prometheus Laboratories, Inc., 566 U.S. 66 (2012)] and Alice [Corp. v. CLS Bank International, 573 U.S. 208 (2014)],” and 2) the 2019 Revised Patent Subject Matter Eligibility Guidance, 84 Fed. Reg. 50 (Jan. 7, 2019) (“Office Guidance”), published by the United States Patent and Trademark Office (“Patent Office”). Specifically, the Board concluded “[u]nder the first step of the Alice/Mayo framework and Step 2A, Prong 1, of [the] Office Guidelines” that claim 34 is directed to the abstract idea of “select[ing] a colored or colorless quality of a fishing hook based on observed and measured water conditions, which is a concept performed in the human mind.” The Board went on to conclude that “[u]nder the second step in the Alice/Mayo framework, and Step 2B of the 2019 Revised Guidance, we determine that the claim limitations, taken individually or as an ordered combination, do not amount to significantly more than” the abstract idea.

Mr. Rudy timely appealed, challenging both the Board’s reliance on the Office Guidance, and the Board’s ultimate conclusion that the claims are not patent eligible.

II. The Federal Circuit

The Federal Circuit unanimously affirmed the Board’ affirmance of the Examiner’s rejection of claims 34, 35, 37, 38, 40, and 45–49 of the ’360 application.

1. Office Guidance vs. Case Law

Mr. Rudy contended that the Board “misapplied or refused to apply . . . case law” in its subject matter eligibility analysis and committed legal error by instead applying the Office Guidance “as if it were prevailing law.”

The Federal Circuit agreed with Mr. Rudy, stating: “[w]e are not[] bound by the Office Guidance, which cannot modify or supplant the Supreme Court’s law regarding patent eligibility, or our interpretation and application thereof.” Interestingly, the Federal cited a non-precedential opinion to support its position: “As we have previously explained:

While we greatly respect the PTO’s expertise on all matters relating to patentability, including patent eligibility, we are not bound by its guidance. And, especially regarding the issue of patent eligibility and the efforts of the courts to determine the distinction between claims directed to [judicial exceptions] and those directed to patent-eligible ap- plications of those [exceptions], we are mindful of the need for consistent application of our case law.

Cleveland Clinic Found. v. True Health Diagnostics LLC, 760 F. App’x. 1013, 1020 (Fed. Cir. 2019) (non-precedential). ”

In conclusion, the Federal Circuit declared: “[t]o the extent the Office Guidance contradicts or does not fully accord with our caselaw, it is our caselaw, and the Supreme Court precedent it is based upon, that must control.”

2. Subject Matter Eligibility of Rudy’s Case

The Federal Circuit concluded that although a portion of the Board’s analysis is framed as a recitation of the Office Guidance, the Board’s reasoning and conclusion for Rudy’s case are nevertheless fully in accord with the relevant caselaw in this particular case.

To determine whether a patent claim is ineligible subject matter, the U.S. Supreme Court has established a two-step Alice/Mayo framework. In Step One, courts must determine whether the claims at issue are directed to a patent-ineligible concept such as an abstract idea. Alice, 573 U.S. at 208. In Step Two, if the claims are directed to an abstract idea, the courts must “consider the elements of each claim both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application.” Id. To transform an abstract idea into a patent-eligible application, the claims must do “more than simply stat[e] the abstract idea while adding the words ‘apply it.’” Id. at 221. At each step, the claims are considered as a whole. See id. at 218 n.3, 225.

a. Step One

With respect to claim 34, the Federal Circuit concluded, as the Board did, that the claim is directed to the abstract idea of selecting a fishing hook based on observed water conditions. Specifically, the Federal Circuit compared claim 34 with Elec. Power Grp., and reasoned that claim 34 requires nothing more than collecting information (water clarity and light transmittance) and analyzing that information (by applying the chart included in the claim), which collectively amount to the abstract idea of selecting a fishing hook based on the observed water conditions. See Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353–54 (Fed. Cir. 2016) (the Federal Circuit held in the computer context that “collecting information” and “analyzing” that information are within the realm of abstract ideas.).

The Federal Circuit disagreed with Mr. Rudy’s contention that claim 34’s preamble, “a method for fishing,” is a substantive claim limitation such that each claim requires actually attempting to catch a fish by placing the selected fishing hook in the water. The Federal Circuit reasoned that such an “additional limitation,” even if that were true, would not alter the conclusion because the character of claim 34 as a whole remains directed to an abstract idea.

The Federal Circuit also disagreed with Mr. Rudy’s contention that claim 34 is not directed to an abstract idea both because fishing “is a practical technological field . . . recognized by the PTO” and because he contends that observing light transmittance is unlikely to be performed mentally. Regarding the “practical technological field,” the Court reasoned that the undisputed fact that an applicant can obtain subject-matter eligible claims in the field of fishing is irrelevant to the fact that the claims currently before the Court are not eligible. Regarding the unlikeliness of the mental performance, the Court pointed our that the plain language of the claims encompasses such mental determination.

The Federal Circuit further rejected Mr. Rudy’s contention that, relying on the machine-or-transformation test, practicing claim 34 “acts upon or transforms fish” by transforming “freely swimming fish to hooked and landed fish” or by transforming a fishing hook “from one not having a target fish on it to one dressed with a fish when a successful strike ensues.” The Court declined to decide in this case whether the transformation from free fish to hooked fish is the type of transformation discussed in Bilski v. Kappos, 561 U.S. 593, 604 (2010) and its predecessor cases. Instead, the Court stated that claim 34 does not actually recite or require the purported transformation that Mr. Rudy relies upon because, as Mr. Rudy’s explained, “landing a fish is never a sure thing. Many an angler has gone fishing and returned empty handed.”

b. Step Two

In the Step Two Analysis, the Court concluded that claim 34 fails to recite an inventive concept at step two of the Alice/Mayo test, and is thus not patent eligible under 35 U.S.C. § 101 because the three elements of the claim (observing water clarity, measuring light transmittance, and selecting the color of the hook to be used), either individually or as an ordered combination, do not amount to “‘significantly more than a patent upon the ineligible concept itself.’” The argument in the Step Two Analysis appears somewhat cursory.

c. The Remaining Claims

The Federal Circuit concluded that claim 38, the only other independent claim on appeal, is not patent-eligible as well.

Claim 38 begins with a method that is substantively identical to claim 34, but includes a slightly different chart for selecting the fishing hook color, and further includes only one additional limitation, which recites: “wherein the fishing hook used is disintegrated from but is otherwise connectable to a fishing lure or other tackle and has a shaft portion, a bend portion connected to the shaft portion, and a barb or point at the terminus of the bend, and wherein the fishing hook used is made of a suitable material, which permits transmittance of light therethrough and is colored to colorless in nature.”

The Court stated that the slightly different substance of claim 38’s chart does not render it patent eligible because the substance of claim 34’s hook color chart was not the basis of the eligibility determination. The Court further stated that its step-one analysis of claim 34 is equally applicable to claim 38 because, as described above, this limitation does not change the fact that the character of the claim, as a whole, is directed to an abstract idea.

The Court also affirmed the Board’s conclusions that dependent claims 35, 37, and 40 are not patent eligible, as each recites the physical attributes of the connection between the fishing hook and the fishing lure in ways not meaningfully distinct from claim 38.

The Court further affirm the Board’s conclusions regarding claims 45–49, which differ from the previously discussed claims only in that they mandate a specific color of fishing hook, which neither changes the character of the claims as a whole, nor provides an inventive concept distinct from the abstract idea itself.

Takeaway

· The case demonstrates that courts still stick to the comparative approach in Alice step one, instead of defining or categorizing the “abstract idea.” This approach is notably in contrast with that of the Patent Office, which follows the Office Guidance, dividing Alice step one into two inquiries: (i) evaluate whether the claim recites a judicial exception; and (ii) evaluate whether the judicial exception is integrated into a practical application if the claim recites a judicial exception.

· To be on the safe side for the purpose of drafting a patent specification including claim(s), which is robust to an invalidity defense under  35 U.S.C. § 101, the Supreme Court’s law regarding patent eligibility, and the Federal Circuit’s interpretation and application thereof, not the Office Guidance, shall be relied on.

When there is competing evidence as to whether a prior art reference is a proper primary reference, an invalidity decision cannot be made as a matter of law at summary judgment

| April 29, 2020

Spigen Korea Co., Ltd. v. Ultraproof, Inc., et al.

April 17, 2020

Newman, Lourie, Reyna (Opinion by Reyna; Dissent by Lourie)

Summary

Spigen Korea Co., Ltd. (“Spigen”) sued Ultraproof, Inc. (“Ultraproof”) for infringement of its multiple patents directed to designs for cellular phone cases.  The district court held that as a matter of law, Spigen’s design patents were obvious over prior art references, and granted Ultraproof’s motion for summary judgment of invalidity.  However, based on the competing evidence presented by the parties, the United States Court of Appeals for the Federal Circuit (the “CAFC”) reversed and remanded, holding that a reasonable factfinder could conclude that a genuine dispute of material fact exists as to whether the primary reference was proper.

原告Spigen社は、自身の所有する複数の携帯電話ケースに関する意匠特許を被告Ultraproof社が侵害しているとして、提訴した。地裁は、原告の意匠特許は、先行技術文献により自明であるとして、裁判官は被告のサマリージャッジメントの申し立てを容認した。しかしながら、連邦控訴巡回裁判所(CAFC)は、双方の提示している証拠には「重要な事実についての真の争い(genuine dispute of material fact)」があるとして、地裁の判決を覆し、事件を差し戻した。

Details

            Spigen is the owner of U.S. Design Patent Nos. D771,607 (“the ’607 patent”), D775,620 (“the ’620 patent”), and D776,648 (“the ’648 patent”) (collectively the “Spigen Design Patents”), each of which claims a cellular phone case.  Figures 3-5 of the ’607 patent are as shown below:

The ’620 patent disclaims certain elements shown in the ’607 patent, and Figures 3-5 of the ’620 patent are shown below:

Finally, the ’648 patent disclaims most of the elements present in the ’620 patent and the ’607 patent, Figures 3-5 of which are shown below:

On February 13, 2017, Spigen sued Ultraproof for infringement of Spigen Design Patents in the United States District Court for the Central District of California.  Ultraproof filed a motion for summary judgment of invalidity of Spigen Design Patents, arguing that the Spigen Design Patents were obvious as a matter of law in view of a primary reference, U.S. Design Patent No. D729,218 (“the ’218 patent”) and a secondary reference, U.S. Design Patent No. D772,209 (“the ’209 patent”).  Spigen opposed the motion arguing that 1) the Spigen Design Patents were not rendered obvious by the primary and secondary reference as a matter of law; and 2) various underlying factual disputes precluded summary judgment.  The district court held that as a matter of law, the Spigen Design Patents were obvious over the ’218 patent and the ’209 patent, and granted summary judgment of invalidity in favor of Ultraproof.  Ultraproof then moved for attorneys’ fees, which the district court denied.  Spigen appealed the district court’s obviousness determination, and Ultraproof cross-appealed the denial of attorneys’ fees.

On appeal, Spigen presented several arguments as to why the district court’s grant of summary judgment should be reversed.  First, Spigen argued that there is a material factual dispute over whether the ’218 patent is a proper primary reference that precludes summary judgment.  The CAFC agreed.  The CAFC explained, citing Titan Tire Corp. v. Case New Holland, Inc., 566 F.3d 1372, 1380-81 (Fed. Cir. 2009) (quoting Durling v. Spectrum Furniture Co., 101 F.3d 100, 103 (Fed. Cir. 1996)) that the ultimate inquiry for obviousness “is whether the claimed design would have been obvious to a designer of ordinary skill who designs articles of the type involved,” which is a question of law based on underlying factual findings.  Whether a prior art design qualifies as a “primary reference” is an underlying factual issue.  The CAFC went on to explain that a “primary reference” is a single reference that creates “basically the same” visual impression, and for a design to be “basically the same,” the designs at issue cannot have “substantial differences in the[ir] overall visual appearance[s].”  Apple, Inc. v. Samsung Elecs. Co., 678 F.3d 1314, 1330 (Fed. Cir. 2012).  A trial court must deny summary judgment if based on the evidence before the court, a reasonable jury could find in favor of the non-moving party.  Here, the district court errored in finding that the ’218 patent was “basically the same” as the Spigen Design Patents despite there being “slight differences,” as a reasonable factfinder could find otherwise.

Spigen’s expert testified that the Spigen Design Patents and the ’218 patent are not “at all similar, let alone ‘basically the same.’”  Spigen’s expert noted that the ’218 patent has the following features that are different from the Spigen Design Patents:

  • unusually broad front and rear chamfers and side surfaces
  • substantially wider surface
  • lack of any outer shell-like feature or parting lines
  • lack of an aperture on its rear side
  • presence of small triangular elements illustrated on its chamfers

In contrast, Ultraproof argued that the ’218 patent was “basically the same” because of the presence of the following features:

  • a generally rectangular appearance with rounded corners
  • a prominent rear chamfer and front chamfer
  • elongated buttons corresponding to the location of the buttons of the underlying phone

Ultraproof stated that the only differences were the “circular cutout in the upper third of the back surface and the horizontal parting lines on the back and side surfaces.”

Based on the competing evidence in the record, the CAFC found that a reasonable factfinder could conclude that the ’218 patent and the Spigen Design Patents are not basically the same.  T

The CAFC determined that a genuine dispute of material fact exists as to whether the ’218 patent is a proper primary reference, and therefore, reversed the district court’s grant of summary judgment of invalidity and remanded the case for further proceedings.

Takeaway

When there is competing evidence in the record, the determination of whether a prior art reference creates “basically the same” visual impression, and therefore a proper primary reference, is a matter that cannot be decided at summary judgment.

A Patent Claim Is Not Indefinite If the Patent Informs the Relevant Skilled Artisan about the Invention’s Scope with Reasonable Certainty

| April 23, 2020

NEVRO CORP. v. BOSTON SCIENTIFIC

April 9, 2020

Before MOORE, TARANTO, and CHEN, Circuit Judges. MOORE, Circuit Judge

中文标题

权利要求的不确定性判定

中文摘要

内夫罗公司(Nevro)起诉波士顿科学公司和波士顿科学神经调节公司(合称波士顿科学)侵犯了内夫罗公司的七项专利。 内夫罗公司对地方法院的专利无效判决提出上诉。根据专利说明书及其申请历史,联邦巡回法院认定“paresthesia-free,” “configured to,” “means for generating,” 和 “therapy signal” 等术语并未使内夫罗公司的权利要求产生不确定性,因此撤销专利无效判决并发回重审。

小结

  • 仅因其为功能用语或仅通过专利权利的诠释不能将功能性语言判定为不确定。
  • 功能性语言的确定性重要体现在专利说明书中需要有解释或支持功能术语的相关结构,特别是侧重方法的专利申请,如果这些申请中存在着系统或设备的权利要求, 而这些系统或设备权利要求由方法的权利要求转化而来,对系统或设备的必要描述是需要的。1
  • 不确定性的判定标准存在于是否权利要求通过说明书和申请历史以合理的确定性向本领域技术人员告知了本发明的范围。

1:许多专利申请通常使用诸如“模块”(module)和“单元”(unit)的术语,并将方法权利要求转换为系统或设备的权利要求。但是,在说明书中如果没有相关的结构说明,由于不确定性,通常这些权利要求会被拒绝。因此,专利说明书中有必要对“模块”或“单元”进行必要的描述,例如电子、通讯及软件类的专利申请,可添加一些与通用处理器,集成芯片或现场可编程门阵列有关的描述,以定义“模块”或“单元”并描述相关功能。

Summary

       Nevro Corporation (Nevro) sued Boston Scientific Corporation and Boston Scientific Neuromodulation Corporation (collectively, Boston Scientific) for infringement of eighteen claims across seven patents. Nevro Corporation appealed the district court’s judgment of invalidity. The Federal Circuit found that the terms “paresthesia-free,” “configured to,” “means for generating,” and “therapy signal” are not rendering the asserted claims indefinite in view of the specifications and prosecution history, vacating and remanding the district court’s judgment of claim invalidity.

Background

       Nevro owns seven patents having method and system claims directed to high-frequency spinal cord stimulation therapy for inhibiting an individual pain. Nevro sued Boston Scientific in the Northern District of California for patent infringement related to U.S. Patent Nos. 8,359,102; 8,712,533; 8,768,472; 8,792,988; 9,327,125; 9,333,357; and 9,480,842.

       In a joint claim construction and summary judgment order, the district court held twelve claims invalid as indefinite. Though six asserted claims survived and were found definite, the district court granted Boston Scientific noninfringement. On appeal, the Federal Circuit concluded the district court erred in holding indefinite the claims reciting the terms “paresthesia-free,” “configured to,” and “means for generating.” The Federal Circuit also found the district court erred in its construction of the term “therapy signal,” though determined not indefinite by the district court. The Federal Circuit, therefore, vacated and remanded the district court’s judgment of invalidity of claims 7, 12, 35, 37 and 58 of the ’533 patent, claims 18, 34 and 55 of the ’125 patent, claims 5 and 34 of the ’357 patent and claims 1 and 22 of the ’842 patent.

Discussion

I. “paresthesia-free”

       Several of Nevro’s asserted claims relate to methods and systems comprising a means for generating therapy signals that are “paresthesia-free.” Claim 18 of the ’125 patent and Claim 1 of the ’472 patent recite as follow:

18.  A spinal cord modulation system for reducing or eliminating pain in a patient, the system comprising:

means for generating a paresthesia-free therapy signal with a signal frequency in a range from 1.5 kHz to 100 kHz; and 

means for delivering the therapy signal to the patient’s spinal cord at a vertebral level of from T9 to T12, wherein the means for delivering the therapy signal is at least partially implantable.

1.    A method for alleviating patient pain or discomfort, without relying on paresthesia or tingling to mask the patient’s sensation of the pain, comprising:

implanting a percutaneous lead in the patient’s epidural space, wherein the percutaneous lead includes at least one electrode, and wherein implanting the percutaneous lead includes positioning the at least one electrode proximate to a target location in the patient’s spinal cord region and outside the sacral region;

implanting a signal generator in the patient; electrically coupling the percutaneous lead to the signal generator; and

programming the signal generator to generate and deliver an electrical therapy signal to the spinal cord region, via the at least one electrode, wherein at least a portion of the electrical therapy signal is at a frequency in a frequency range of from about 2,500 Hz to about 100,000 Hz.

       The district court presented its findings based on extrinsic evidence that “[a]lthough the parameters that would result in a signal that does not create paresthesia may vary between patients, a skilled artisan would be able to quickly determine whether a signal creates paresthesia for any given patient.” While holding that the term “paresthesia-free” does not render the method claims indefinite, the district court held indefiniteness regarding the asserted system and device claims. The Federal Circuit disagreed the indefiniteness holdings because the test of indefiniteness should be simply based on whether a claim “inform[s] those skilled in the art about the scope of the invention with reasonable certainty.” The Federal Circuit states that the district court applied the wrong legal standard and the test for indefiniteness is not whether infringement of the claim must be determined on a case-by-case basis.

       The Federal Circuit states that “paresthesia-free,” a functional term defined by what it does rather than what it is, does not inherently render it indefinite. Furthermore, the Federal Circuit instructs that

i. functional language can “promote[] definiteness because it helps bound the scope of the claims by specifying the operations that the [claimed invention] must undertake.” Cox Commc’ns, 838 F.3d at 1232.

ii. the ambiguity inherent in functional terms may be resolved where the patent “provides a general guideline and examples sufficient to enable a person of ordinary skill in the art to determine the scope of the claims.”  Enzo Biochem. Inc. v. Applera Corp., 599 F.3d 1325, 1335 (Fed. Cir. 2010).

II. “configured to”

Nevro’s asserted claim 1 of the ’842 patent relates to a spinal cord modulation system, which recites:

1.  A spinal cord modulation system comprising: 

a signal generator configured to generate a therapy signal having a frequency of 10 kHz, an amplitude up to 6 mA, and pluses having a pulse width between 30 microseconds and 35 microseconds; and

an implantable signal delivery device electrically coupleable to the signal generator and configured to be implanted within a patient’s epidural space to deliver the therapy signal from the signal generator the patient’s spinal cord.

       The district court held indefiniteness because it determined that “configured to” is susceptible to meaning one of two constructions: “(1) the signal generator, as a matter of hardware and firmware, has the capacity to generate the described electrical signals (either without further programing or after further programming by the clinical programming software); or (2) the signal generator has been programmed by the clinical programmer to generate the described electrical signals.”

       The Federal Circuit pointed out that “the test [of indefiniteness] is not merely whether a claim is susceptible to differing interpretations” because “such a test would render nearly every claim term indefinite so long as a party could manufacture a plausible construction.” Further, the Federal Circuit states that the test for indefiniteness is whether the claims, viewed in light of the specification and prosecution history, “inform those skilled in the art about the scope of the invention with reasonable certainty.”  Nautilus, 572 U.S. at 910. (emphasis added).

       The specifications of the asserted patents and prosecution history, indeed, help Nevro win the argument on “configured” means. Nevro’s asserted patents not only recites that “the system is configured and programmed to,” but also Nevro agreed with the examiner that “configured” means “programmed” as opposed to “programmable.” The limitation specifies the interpretation of the term “configured” and leads to this favorable decision towards Nevro. The “programmed” and “programmable” may sound similar. However, “programmable” would be appliable to a general machine, since any general signal generator would have the capacity to generate the described signals. The term “programmed” sets out its specific settings of the signal generator and limits such broad interpretation.

III. “means for generating”

       Several asserted claims of the ‘125 patent recite “means for generating,” in which claim 18 recites as follow:

18.  A spinal cord modulation system for reducing or eliminating pain in a patient, the system comprising:

means for generating a paresthesia-free therapy signal with a signal frequency in a range from 1.5 kHz to 100 kHz; and

means for delivering the therapy signal to the patient’s spinal cord at a vertebral level of from T9 to T12, wherein the means for delivering the therapy signal is at least partially implantable.

       Nevro argued that the specification discloses a signal generator as the structure. The Federal Circuit agreed with Nevro and explained the difference comparing a general-purpose computer or processor. If the identified structure is a general-purpose computer or processor, it does require a specific algorithm. A signal or pulse generator is not considered as a general-purpose computer or processor, since it has the structure for the claimed “generating” function. Further, “the specification teaches how to configure the signal generators to generate and deliver the claimed signals using the recited parameters, clearly linking the structure to the recited function.” Hence, the Federal Circuit held that the district court erred in holding indefinite claims with the terms “means for generating.”

       The terms such as “module” and “unit” are commonly used in many patent applications to convert method claims to system or device claims in electronic applications. However, without structural description in the specification, such claims are usually rejected due to indefiniteness. Hence, some may add some description related to general-purpose processors, integrated chips, or field-programmable gate arrays to define the “module” or “unit” and describe the functions.

IV. “therapy signal”

       The Federal Circuit agreed that claims reciting a “therapy signal” are not indefinite, but held that the district court incorrectly construed the term. The Federal Circuit reiterated the context of the specification and prosecution history for understanding the words of a claim. It stated that “[t]he words of a claim are generally given their ordinary and customary meaning as understood by a person of ordinary skill in the art when read in the context of the specification and prosecution history.”  Thorner v. Sony Comput. Entm’t Am. LLC, 669 F.3d 1362, 1365 (Fed. Cir. 2012). 

       Boston Scientific argued that the asserted claims reciting a “therapy signal” are indefinite because “two signals with the same set of characteristics (e.g., frequency, amplitude, and pulse width) may result in therapy in one patient and no therapy in another.”  The Federal Circuit noted that “the fact that a signal does not provide pain relief in all circumstances does not render the claims indefinite.” Geneva, 349 F.3d at 1384.

Takeaway

  • Functional language won’t be held indefinite simply for that reason or simply by interpreted in the claims.
  • It is of importance to describe a related structure to support the functional terms in the specification, especially for applications having system or device claims converted from method claims.
  • The test for indefiniteness is whether the claims, viewed in light of the specification and prosecution history, “inform those skilled in the art about the scope of the invention with reasonable certainty.” Nautilus, 572 U.S. at 910.

For Biotech, “Method of Preparation” Claims May Survive §101

| April 15, 2020

Illumina, Inc. v. Ariosa Diagnostics, Inc.

March 17, 2020

Lourie, Moore, and Reyna (Opinion by Lourie; Dissent by Reyna)

Summary

In a patent infringement litigation between the same parties that were involved in the earlier case, Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371 (Fed. Cir. 2015) (diagnostic patent deemed patent ineligible under 35 U.S.C. §101), the United States Court of Appeals for the Federal Circuit (“Federal Circuit”) found the claimed “method of preparation” of a fraction of cell-free fetal DNA (“cff-DNA”) enriched in fetal DNA to be patent eligible, reversing the district court’s grant of summary judgment of patent ineligibility.  A dissent by J. Reyna (author of the earlier Ariosa decision) asserts that there is nothing new and useful in the claims, other than the discovery that cff-DNA tends to be shorter than cell-free maternal DNA, and that use of known laboratory techniques and commercially available testing kits to isolate the naturally occurring shorter cff-DNA does not make the claims patent eligible.

Details

Illumina and Sequenom (collectively, “Illumina”) appealed a summary judgment ruling of patent ineligibility by the United States District Court for the Northern District of California.  The two patents at issue, USP 9,580,751 (the ‘751 patent) and USP 9,738,931 (the ‘931 patent), are unrelated to the diagnostic patent held ineligible in the 2015 Ariosa decision.  While the earlier litigated patent claimed a method for detecting the small fraction of cff-DNA in the plasma and serum of a pregnant woman that were previously discarded as medical waste, the present ‘751 and ‘931 patents claim methods for preparing a fraction of cff-DNA that is enriched in fetal DNA.  A problem with maternal plasma is that it was difficult, if not impossible, to determine fetal genetic markers (e.g., for certain diseases) because the proportion of circulatory extracellular fetal DNA in maternal plasma was tiny as compared to the majority of it (>90%) being circulatory extracellular maternal DNA. The inventor’s “surprising” discovery was that the majority of circulatory extracellular fetal DNA has a relatively small size of approximately 500 base pairs or less, as compared to the larger circulatory extracellular maternal DNA.  With this discovery, they developed the following claimed methods for preparing a DNA fraction that separated fetal DNA from maternal DNA from the maternal plasma and serum, to create a DNA fraction enriched with fetal DNA.

‘931 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 extracellular circulatory DNA fragments, and

                        (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).

‘751 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 Federal Circuit had consistently found diagnostic claims patent ineligible (as directed to natural phenomenon) (Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC, 927 F.3d 1333 (Fed. Cir. 2019); Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC, 915 F.3d 743 (Fed. Cir. 2019); Cleveland Clinic Found. v. True Health Diagnostics LLC, 859 F.3d 1352 (Fed. Cir. 2017)).  In contrast, the Federal Circuit had also held that method of treatment claims are patent eligible (Endo Pharm. Inc. v. Teva Pharm. USA, Inc., 919 F.3d 1347 (Fed. Cir. 2019); Natural Alternative Int’l, Inc. v. Creative Compounds, LLC, 918 F.3d 1338 (Fed. Cir. 2019); and Vanda Pharm. Inc. v. West-Ward Pharm. Int’l Ltd., 887 F.3d 1117 (Fed. Cir. 2018)).  However, this is not a diagnostic case, nor a method of treatment case.  This is a method of preparation case – which the Federal Circuit found to be patent eligible.

The natural phenomenon at issue is that cell-free fetal DNA tends to be shorter than cell-free maternal DNA in the mother’s bloodstream.  However, under the Alice/Mayo Step 1, the Federal Circuit held that these claims are not directed to a natural phenomenon.  Instead, the claims are directed to a method that utilizes that phenomenon.  The claimed method recites specific process steps – size discrimination and selective removal of DNA fragments above a specified size threshold.  These process steps change the composition of the normal maternal plasma or serum, creating a fetal DNA enriched mixture having a higher percentage of cff-DNA fraction different from the naturally occurring fraction in the normal mother’s blood.  “Thus, the process achieves more than simply observing that fetal DNA is shorter than maternal DNA or detecting the presence of that phenomenon.”

In distinguishing the earlier Ariosa case, the Federal Circuit stated, “the claims do not merely cover a method for detecting whether a cell-free DNA fragment is fetal or maternal based on its size.” 

In distinguishing the Supreme Court decision in Association for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576 (2013), the Federal Circuit noted that the “Supreme Court in Myriad expressly declined to extend its holding to method claims reciting a process used to isolate DNA” and that “in Myriad, the claims were ineligible because they covered a gene rather than a process for isolating it.”  Here, the method “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.”  This is the opposite of Myriad.

As for whether the techniques for size discrimination and selective removal of DNA fragments were well-known and conventional, those considerations are relevant to the Alice/Mayo Step 2 analysis, or to 102/103 issues – not for Alice/Mayo Step 1.  The majority concluded patent eligibility under Step 1 and did not proceed to Step 2.

J. Reyna’s dissent focused on the claims being directed to a natural phenomenon because the “only claimed advance is the discovery of that natural phenomenon.”  In particular, referring to a “string of cases reciting process claims” since 2016, the “directed to” inquiry under Alice/Mayo Step 1 asks “whether the ‘claimed advance’ of the patent ‘improves upon a technological process or is merely an ineligible concept.’” citing Athena, 915 F.3d at 750 and Genetic Techs., 818 F.3d at 1375.  “Here, the claimed advance is merely the inventors’ ‘surprising[]’ discovery of a natural phenomenon – that cff-DNA tends to be shorter than cell-free maternal DNA in a mother’s bloodstream.”  J. Reyna criticizes the majority for ignoring the “claimed advance” inquiry altogether.

Under the claimed advance inquiry, one looks to the written description.  Here, the written description identifies the use of well-known and commercially available tools/kits to perform the claimed method.  Checking for 300 and 500 base pairs using commercially available DNA size markers and kits does not constitute any “advance.”  There is no improvement in the underlying DNA processing technology, but for checking the natural phenomenon of sizes indicative of cff-DNA.

J. Reyna also criticized the majority’s “change in the composition of the mixture” justification.  “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.”  Here, one begins and ends with the same naturally occurring substances – cell-free fetal DNA and cell free maternal DNA.  There is no creation or alteration of any genetic information encoded in the cff-DNA.  Therefore, the claims are directed to a natural phenomenon under Alice/Mayo Step 1. 

J. Reyna also found no inventive concept under Alice/Mayo Step 2.

Take Away

  • Until there is an en banc rehearing or a Supreme Court review of this case, this case is an example of a patent eligible method of preparation claim.
  • For defendants, the “claimed advance” inquiry could help sink a claimed method under Alice/Mayo Step 1. 

FACEBOOK’S IPRs CAN’T FRIEND EACH OTHER

| April 10, 2020

FACEBOOK, INC. v. WINDY CITY INNOVATIONS, LLC.

March 18, 2020

Prost, Plager and O’Malley (Opinion by Prost)

SummaryPlaintiff/Patent Holder Windy Citysuccessfully cross-appealed against Facebook on the issue of improper joinder of IPRs under 35 U.S.C. § 315(c).  Facebook had filed IPRs within one year of Windy City’s District Court complaint and then joined later filed IPRs adding new claims. The PTAB had allowed the joinder.  The CAFC vacated the Board’s joinder finding that Facebook could not join their own already filed IPRs.

Background:

In June 2016, exactly one year after being served with Windy City’s complaint for infringement of four patents related to methods for communicating over a computer-based net-work, Facebook timely petitioned for inter partes review (“IPR”) of several claims of each patent. At that time, Windy City had not yet identified the specific claims it was asserting in the district court proceeding. The four patents totaled 830 claims. The Patent Trial and Appeal Board (“Board”) instituted IPRs of each patent.

In January 2017, after Windy City had identified the claims it was asserting in the district court litigation, Facebook filed two additional petitions for IPR of additional claims of two of the patents.  Facebook concurrently filed motions for joinder to the already instituted IPRs on those patents.    By the time of filing the new IPRs, the one-year time bar of §315(b) had passed.  The Board nonetheless instituted Facebook’s two new IPRs, and granted Facebook’s motions for joinder.

The Board agreed with Facebook that Windy City’s district court complaint generally asserting  the  “claims” of the asserted patents “cannot reasonably be considered  an  allegation  that  Petitioner  infringes  all  830  claims of the several patents asserted.”  The Board therefore found that Facebook could not have reasonably determined which claims were asserted against it within the one-year  time  bar.  Once Windy City identified the asserted claims after the one-year time bar, the  Board  found  that  Facebook did not delay in challenging the newly asserted claims  by  filing  the  second  petitions  with  the  motions  for joinder.

The Board found that Facebook had shown by a  preponderance  of  the  evidence  that  some  of  the  challenged  claims are unpatentable, many  of  these  claims  had only been challenged in the later filed and joined IPRs.  Facebook appealed and Windy City cross-appealed on the Board’s  obviousness  findings.   Further, Windy City also challenged the Board’s joinder decisions allowing Facebook to join its new IPRs to its existing  IPRs  and  to  include new claims in the joined proceedings.  Windy City’s cross-appeal on the joinder issue is addressed here.

Discussion:

In its cross-appeal, Windy City argued that the Board’s decisions granting joinder were improper on the basis that 35 U.S.C. § 315(c): (1) does not permit a person to be joined as a party to a proceeding in which it was already a party (“same-party” joinder); and (2) does not permit new issues to be added to an existing IPR through joinder (“new issue”  joinder),  including  issues  that  would  otherwise  be  time-barred.

Sections 315(b) and (c) recite:  

(b) Patent Owner’s Action. —An inter partes review may not be instituted if the petition requesting  the  proceeding  is  filed  more  than  1  year  after  the date on which the petitioner, real party in interest,  or  privy  of  the  petitioner  is  served  with  a  complaint alleging infringement of the patent.  The time limitation set forth in the preceding sentence shall not apply to a request for joinder under subsection (c).

(c)  Joinder. —If  the  Director  institutes  an  inter  partes review, the Director, in his or her discretion, may join as a party to that inter partes review any person who properly files a petition under section 311 that the Director, after receiving a preliminary response under section 313 or the expiration of the time  for  filing  such  a  response,  determines  warrants the institution of an inter partes review under section 314.

The CAFC noted that §315(b) articulates the time-bar for when an IPR “may not be instituted.” 35 U.S.C. §315(b). But §315(b) includes a specific exception to the time bar, namely “[t]he time limitation . . . shall not apply to a request for joinder under subsection (c).”

Regarding the propriety of Facebooks joinder, the Court held the plain language of §315(c) allows the  Director  “to  join  as  a  party  [to  an  already  instituted  IPR]  any  person”  who  meets  certain  requirements.    However, when the Board instituted Facebook’s later petitions and granted its joinder motions, the Board did not purport to  be  joining  anyone as a party.  Rather, the Board understood Facebook to be requesting that its later proceedings be joined to its earlier proceedings.  The CAFC concluded that the Boards interpretation of §315(c) was incorrect because their decision authorized two proceedings to be joined, rather than joining a person as a party to an existing proceeding.

Section 315(c) authorizes the Director to “join as a party to [an IPR] any person who” meets certain requirements, i.e., who properly files a petition the Director finds warrants the institution of an IPR under § 314. No part of § 315(c) provides the Director or the Board with the authority to put two proceedings together. That is the subject of § 315(d), which provides for “consolidation,” among other options, when “[m]ultiple proceedings” involving the patent are before the PTO.35 U.S.C. § 315.

The Court went on to explain that the clear and unambiguous language of § 315(c) confirms that it does not allow an existing party to be joined as a new party, noting that subsection (c) allows the Director to “join as a party to [an IPR] any person who” meets certain threshold requirements. They noted that it would be an extraordinary usage of the term “join as a party” to refer to persons who were already a party.  Finding the phrase “join as a party to a proceeding” on its face limits the range of “person[s]” covered to those who, in normal legal discourse, are capable of being joined as a party to a proceeding (a group further limited by the own-petition requirements), and an existing party to the proceeding is not so capable.

            Regarding the second issue raised by Windy City that the Joinder cannot include newly raised issues, the CAFC found the language in §315(c) does no more than authorize the Director to join 1) a person 2) as a party, 3) to an already instituted IPR. Finding this language does not authorize the joined party to bring new issues from its new proceeding into the existing proceeding, particularly when those new issues are other-wise time-barred.

            The Court noted that under the statute, the already-instituted IPR to which a person may join as a party is governed by its own petition and is  confined  to  the  claims  and  grounds  challenged in that petition.

            In reaching these conclusions, the Court did acknowledge the rock and hard place Facebook is left in.

            We do not disagree with Facebook that the result in this particular case may seem in tension with one of the AIA’s objectives for IPRs “to provide ‘quick and cost effective alternatives’ to litigation in the courts.” [Citations omitted] Indeed, it is fair to assume that when Congress imposed the one-year time bar of § 315(b), it did not explicitly contemplate a situation where an accused infringer had not yet ascertained which specific claims were being asserted against it in a district court proceeding before the end of the one-year time period. We also recognize that our analysis here may lead defendants, in some circumstances, to expend effort and expense in challenging claims that may ultimately never be asserted against them.

            However, the Court gave little remedy to bearing an enormous “effort and expense” of filing IPRs to 830 claims, asserting that they are bound by the unambiguous nature of the statute.

Petitioners who, like Facebook, are faced with an enormous number of asserted claims on the eve of the IPR filing deadline, are not without options. As a protective measure, filing petitions challenging hundreds of claims remains an available option for accused infringers who want to ensure that their IPRs will challenge each of the eventually asserted claims. An accused infringer is also not obligated to challenge every, or any, claim in an IPR. Accused infringers who are unable or unwilling to challenge every claim in petitions retain the ability to challenge the validity of the claims that are ultimately asserted in the district court. Accused infringers who wish to protect their option of proceeding with an IPR may, moreover, make different strategy choices in federal court so as to force an earlier narrowing or identification of asserted claims. Finally, no matter how valid, “policy considerations cannot create an ambiguity when the words on the page are clear.” SAS, 138 S. Ct. at 1358. That job is left to Congress and not to the courts.

            Hence, the CAFC concluded that the clear and unambiguous  language of §315(c) does not authorize same-party joinder, and also does not authorize joinder of new issues, including issues that would otherwise be time-barred. As a result, they vacated the Board’s decisions on all claims which were asserted in the later filed IPRs.

Take AwayA loop-hole between the one-year time bar, joinder statute for IPRs and District Court timing potentially gives a Plaintiff/Patent holder the ability to render an IPR more cost inefficient to a Defendant/Petitioner.  By not identifying the claims to be asserted within one year of filing a patent infringement complaint, the patent holder can place a large burden on filing an IPR.  Plaintiffs/Patent holders can strategize to assert infringement ambiguously to a prohibitive number of claims early in a District Court proceeding.  Defendants will need to attempt to counter such a strategy by requesting District Courts to force Plaintiffs to identify the specific claims which will be asserted within one year of filing the complaint.

When the Broadest Reasonable Interpretation (BRI) Becomes Unreasonable

| March 26, 2020

Kaken Pharmaceutical Co., Ltd., Bausch Health Companies Inc. v. Andrei Iancu, Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office

March 13, 2020

Before Newman, O’Malley, and Taranto (Opinion by Taranto)

U.S. patent practitioners constantly need to address use of the broadest reasonable interpretation (BRI) by Examiners during patent prosecution. During prosecution, arguments and amendments are typically presented to overcome prior art and become a part of the prosecution history along with the disclosure of the invention. This decision illustrates that definitions provided in the specification in conjunction with the prosecution history can potentially save a patent from a later challenge which invokes BRI. In this case, an erroneous claim construction of one claim limitation during an inter partes review caused the CAFC to reverse and remand back to the Patent Trial and Appeal Board (PTAB).  

U.S. patent No. 7,214,506 is directed a method for treating onychomycosis.  Claim 1 recites:

1. A method for treating a subject having onychomycosis wherein the method comprises topically administering to a nail of said subject having onychomycosis a therapeutically effective amount of an antifungal compound represented by the following formula:

wherein, Ar is a non-substituted phenyl group or a phenyl group substituted with 1 to 3 substituents selected from a halogen atom and trifluoromethyl group,

R1 and R2 are the same or different and are hydrogen atom, C1-6 alkyl group, a non-substituted aryl group, an aryl group substituted with 1 to 3 substituents selected from a halogen atom, trifluoromethyl group, nitro group and C1-16 alkyl group, C2-8 alkenyl group, C2-6 alkynyl group, or C7-12 aralkyl group,

m is 2 or 3,

n is 1 or 2,

X is nitrogen atom or CH, and

*1 and *2 mean an asymmetric carbon atom.

Acrux[1] had successfully obtained inter partes review of all claims of the ‘506 patent, with the Patent Trial and Appeal Board (PTAB) ultimately determining that all claims are unpatentable for obviousness (based on a set of three references in combination with another set of two references for six total grounds). The first set of three references teach a method of topically treating onychomycosis with various azole compounds while the second set teaches KP-103 (an azole compound within the scope of claim 1) as an effective antifungal agent.

Kaken had argued that the phrase “treating a subject having onychomycosis” means “treating the infection at least where it primarily resides in the keratinized nail plate and underlying nail bed.” Kaken argued that the ‘506 patent’s key innovation is a topical treatment that can easily penetrate the tough keratin in the nail plate. This construction was rejected by the PTAB as too narrow because of the express definition of onychomycosis as including superficial mycosis, and the express definition in the specification of “nail includes the tissue or skin around the nail plate, nail bed, and nail matrix.” The PTAB concluded that “treating onychomycosis” includes treating “superficial mycosis that involves the skin or visible mucosa.”

The nail plate is defined as the “horny appendage of the skin that is composed mainly of keratin” whereas the “eponychium and hyponychium” are “the skin structures surrounding the nail.”

The CAFC reversed the PTAB’s claim construction as unreasonable in light of the specification and prosecution history as the broadest reasonable interpretation of treating a subject having onychomycosis “is penetrating the nail plate to treat a fungal infection inside the nail plate or in the nail bed under it.”

The CAFC came to this conclusion based on the specification’s characterization of onychomycosis in a way which links three other crucial passages. In particular, after defining the terms “skin” and “nail” and characterizing “superficial mycosis”, the specification stated that onychomycosis is “a kind of the above-mentioned superficial mycosis, in the other word a disease which is caused by invading and proliferating in the nail of human or an animal.” Thus, the specification conveys that onychomycosis is a disease with two basic features (1) of a disease of the nail and (2) it is a kind of superficial mycosis. As such, the BRI of onychomycosis would not include invasion of any part of what is defined as the nail other than the nail plate or nail bed, such as skin in its ordinary sense. The PTAB’s inclusion of the eponychium and hyponychium is unreasonable as the specification defined that onychomycosis is a disease involving invasion of the nail.

Other parts of the specification explain that an effective topical treatment would need to penetrate the nail plate, and the ‘506 patent explained that known topical treatments were largely ineffective. The patent further contains as objects as good permeability, good retention capacity and conservation of high activity to indicate that treating an infection of skin surrounding the nail plate alone would not require all these properties.

The prosecution history also included statements overcoming prior art as providing “decisive support” for Kaken’s claim construction. Kaken’s statements, followed by the examiner’s statements, make clear the limits on a reasonable understanding of what Kaken was claiming. The exchange between the examiner and Kaken:

“would leave a skilled artisan with no reasonable uncertainty about the scope of the claim language in the respect at issue here. Kaken is bound by its arguments made to convince the examiner that claims 1 and 2 are patentable. See Standard Oil, 774 F.2d at 452. Thus, Kaken’s unambiguous statement that onychomycosis affects the nail plate, and the examiner’s concomitant action based on this statement, make clear that “treating onychomycosis” requires penetrating the nail plate to treat an infection inside the nail plate or in the nail bed under it.”

Since the PTAB relied upon an erroneous claim construction throughout its consideration of facts in its obviousness analysis, the CAFC vacated the PTAB’s decision and remanded.

Takeaways:

Intrinsic evidence in the specification can overcome an ordinary meaning in the art (extrinsic evidence).

Although an applicant desires a broad interpretation of patent claims, too broad of an interpretation can open the patent to attacks. As such, the prosecution history plays an important role.

Some past decisions have taught patent practitioners to avoid stating objects of the invention or discussion of prior art. However, stating objects and providing a discussion of prior art can be important for securing a proper claim construction, particularly in “crowded” art areas.


[1] Acrux withdrew from the appeal, and the Director intervened to defend the PTAB’s decision.

Post-Importation Activity can be used by the International Trade Commission for determining a violation of Section 337

| March 18, 2020

Comcast Corporation v. ITC and Rovi Corporation

March 2, 2020

Newman, Reyna and Hughes. Opinion by Newman

Summary:

Rovi Corporation (hereinafter “Rovi”) filed a Section 337 complaint with the ITC for infringement of U.S. Patent No. 8,006,263 (“the ‘263 patent”) and U.S. Patent No. 8,578,413 (“the ‘413 patent”) based on importation of Comcast’s X1 set-top box used in an infringing system. Arris Enterprises and Technicolor SA imported the devices for Comcast and were also named in the complaint. The ITC found that even though infringement of the patents does not occur until after importation and when the customer connects a mobile device to the X1 set-top box, the X1 set-top boxes are still considered “articles that infringe” under Section 337. The ITC also found that Comcast induced the infringement by providing guidance and instructions to customers on how to operate the system. Comcast did not dispute direct infringement by the customer or its induced infringement. Comcast argued that the X1 set-top boxes are not “articles that infringe” under Section 337 because the boxes do not infringe at the time of importation. The CAFC agreed with the ITC affirming that the X1 set-top boxes are “articles that infringe” and that Comcast is considered an importer under Section 337.

Details:

The patents at issue are to an interactive television program guide system for remote access to television programs. The claims require a remote program guide access device such as a mobile device that is connected to an interactive television program guide system over a remote access link so that users can remotely access the program guide system. Claim 1 of the ‘263 patent is provided.

1. A system for selecting television programs over a remote access link comprising an Internet communications path for recording, comprising:

a local interactive television program guide equipment on which a local interactive television program guide is implemented, wherein the local interactive television program guide equipment includes user television equipment located within a user’s home and the local interactive television program guide generates a display of one or more program listings for display on a display device at the user’s home; and

a remote program guide access device located outside of the user’s home on which a remote access interactive television program guide is implemented, wherein the remote program guide access device is a mobile device, and wherein the remote access interactive television program guide:

generates a display of a plurality of program listings for display on the remote program guide access device, wherein the display of the plurality of program listings is generated based on a user profile stored at a location remote from the remote program guide access device;

receives a selection of a program listing of the plurality of program listings in the display, wherein the selection identifies a television program corresponding to the selected program listing for recording by the local interactive television program guide; and

transmits a communication identifying the television program corresponding to the selected program listing from the remote access interactive television program guide to the local interactive television program guide over the Internet communications path;

wherein the local interactive television program guide receives the communication and records the television program corresponding to the selected program listing responsive to the communication using the local interactive television program guide equipment.

The ITC found that the X1 set-top boxes are imported by Arris and Technicolor, and that Comcast is sufficiently involved with the design, manufacture and importation of the accused products such that Comcast is an importer under Section 337. The ITC further found that Comcast’s customers directly infringe the patents through use of the X1 systems in the US and that Comcast induced that infringement because Comcast instructs, directs, or advises its customers on how to carry out direct infringement of the claims of the patents.

Regarding Arris and Technicolor, the ITC found that they do not directly infringe the asserted claims of the patents because they do not provide a “remote access device,” and they do not contributorily infringe because the set-top boxes have substantial non-infringing uses.

The ITC issued a limited exclusion order excluding importation of the X1 set-top boxes by Comcast, including importation by Arris and Technicolor on behalf of Comcast. Comcast, Arris and Technicolor appealed the ITC decision.

Motion to Dismiss Appeal

The CAFC first addressed a motion to dismiss the appeal by Comcast, Arris and Technicolor because the patents at issue have now expired. The ‘263 patent expired on September 18, 2019 and the ‘413 patent expired on July 16, 2019. Comcast argued that the appeal is moot because after expiration of a patent, the ITC’s limited exclusionary order has no further prospective effect.

The ITC and Rovi opposed the motion to dismiss because there are continuing issues and actions to which these decisions are relevant, “whereby appellate finality is warranted because there are ongoing ‘collateral consequences.’” There are two other ITC investigations on unexpired Rovi patents that involve the X1 set-top boxes and that these investigations are likely to be affected by the decisions on this appeal as they have similar issues of importation.

The CAFC stated that “a case may remain alive based on collateral consequences, which may be found in the prospect that a judgment will affect future litigation or administrative action” citing Hyosung TNS Inc. v. U.S. Int’l Trade Comm’n, 926 F.3d 1353, 1358. The additional pending cases involve unexpired patents related to the same X1 set-top boxes and “the issues on appeal concern the scope of Section 337 as a matter of statutory interpretation. The CAFC denied the motion to dismiss because there are sufficient collateral consequences to negate mootness.

Articles that Infringe

Comcast did not dispute direct infringement by its customers, and did not dispute that it induces infringement by its customers. Comcast argued that its conduct is not actionable under Section 337 because Comcast’s conduct “takes place entirely domestically, well after, and unrelated to, the article’s importation.” Comcast stated that the imported X1 set-top boxes are not “articles that infringe” because the boxes do not infringe the patents at the time of importation.

The statutory basis for Section 337 investigations relevant to this case is in 19 U.S.C. § 1337(a) which states:

(1) Subject to paragraph (2), the following are unlawful . . . .

(B) The importation into the United States, the sale for importation, or the sale within the United States after importation by the owner, importer, or consignee, of articles that—

(i) infringe a valid and enforceable United States patent . . . .

Comcast argued that the ITC’s authority is limited to excluding articles that infringe “at the time of importation.” The ITC and Rovi, citing Suprema, Inc. v. U.S. Int’l Trade Comm’n, 796 F.3d 1338 (Fed. Cir. 2015) (en banc), stated that imported articles can infringe in terms of Section 337, when infringement occurs after importation. The basis of the Suprema decision was that the statute defines as unlawful “the sale within the United States after importation … of articles that—(i) infringe. The CAFC cited the following passage from the Suprema Decision:

The statute thus distinguishes the unfair trade act of importation from infringement by defining as unfair the importation of an article that will infringe, i.e., be sold, “after importation.” Section 337(a)(1)(B)’s “sale . . . after importation” language confirms that the Commission is permitted to focus on post-importation activity to identify the completion of infringement.

Suprema, Inc. at 1349.

Comcast argued that based on the facts in Suprema, inducement liability must be attached to the imported article at the time of the article’s importation.  The imported X1 set-top boxes are incapable of infringement until the X1 set-top boxes are combined with Comcast’s domestic servers and its customers mobile devices. Comcast stated that any inducing conduct of articles that infringe occurs entirely after the boxes’ importation.

The CAFC stated that the ITC correctly held that Section 337 applies to articles that infringe after importation. The CAFC also cited the ITC decision which pointed out that Comcast designed the X1 set-top boxes to be used in an infringing manner, directed the manufacture overseas, and directed the importation. The ITC concluded that the inducing activity took place prior to importation, at importation, and after importation. The CAFC agreed with the ITC that X1 set-top boxes imported by and for Comcast for use by Comcast’s customers are “articles that infringe.”

Importer

Comcast argued that it is not an importer of the X1 set-top boxes because Arris or Technicolor are the actual importers, and because Comcast does not physically bring the boxes into the US and it does not exercise control over the importation process.

The CAFC agreed with the ITC that Comcast is an importer of the X1 set-top boxes under Section 337. The ITC found that Comcast is sufficiently involved in the importation of the X1 boxes that it satisfies the importation requirement. The ITC pointed out that the X1 boxes are particularly tailored for Comcast and they would not work with another cable operator’s system, Comcast is involved with the design, manufacture and importation of the X1 boxes, that Comcast controls the importation of the X1 boxes because Comcast provides Arris and Technicolor with technical documents so that the X1 boxes work as required by Comcast, and that the X1 boxes are designed only for Comcast. Comcast also restricts Arris from selling the products without Comcast’s permission. The ITC also found that Comcast directs Arris and Technicolor to deliver the accused products to Comcast delivery sites. The CAFC stated that the ITC’s findings are supported by substantial evidence.

Limited Exclusion Order

Arris and Technicolor argued that the limited exclusion order should not apply to them because they were found not to be infringers or contributory infringers. The ITC said that the exclusion order is within ITC’s discretion because the order is limited to importations “on behalf of Comcast” of articles whose intended use is to infringe the patents at issue. The CAFC agreed that the limited exclusion order is within the ITC’s discretion as “reasonably related to stopping the unlawful infringement.”

Comments

An importer of goods may not be able to avoid a Section 337 violation even though the goods do not infringe at the time of importation. Post-importation activity can be used to determine the completion of infringement. In this case, the X1 box itself does not infringe the patents at the time of importation. Customers infringe the patents only after a mobile device is connected to the system which is at the direction of Comcast.

Also, even if someone else imports the goods for you and you do not physically bring the goods into the US, you may still be considered an importer of the goods under Section 337 if you have a certain amount of control over the goods to be imported or the actual importation.

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