Patent Docs

Conference & CLE Calendar

October 21, 2018

October 23, 2018 – "The State of 'Printed Publication' Prior Art Case Law: Practical Considerations for Patent Holders and Patent Challengers" (Strafford) – 1:00 to 2:30 pm (EDT)

October 24, 2018 – Biopharma Patent Law (McDonnell Boehnen Hulbert & Berghoff LLP and Patent Docs) – 9:30 am to 1:00 pm, Cambridge, MA

October 24, 2018 – "Preparing 'Diagnose & Treat' Patent Claims to be Valid and Enforceable" (Technology Transfer Tactics) – 1:00 to 2:00 pm (ET)

October 24, 2018 – "How to Analyze Federal Circuit Opinions on Patent Law" (LexisNexis) – 3:30 to 4:30 pm (ET), Washington, DC

October 24, 2018 – "Crisis Management for IP Lawyers & Their Clients — Trade Secrets and Reputation Risk Management" (Intellectual Property Law Association of Chicago Trade Secret and Unfair Competition Committee) – 3:00 to 4:00 pm (CT), Chicago, IL

October 30, 2018 – "Obviousness Standard: Leveraging Latest PTO and Court Guidance — Overcoming Challenges of Obviousness and Attacks on Patent Validity" (Strafford) – 1:00 to 2:30 pm (EDT)

October 30, 2018 – European biotech patent law update (D Young & Co) – 5:00 am, 8:00 am, and 1:00 pm (EDT)

October 30, 2018 – "University Technology Transfer and Licensing Agreements — Determining Type of Transfer Agreement to Use, Structuring Key Provisions, Overcoming Unique Challenges" (Strafford) – 1:00 to 2:30 pm (EDT)
Webinar on Obviousness Standard

October 20, 2018

Strafford will be offering a webinar entitled "Obviousness Standard: Leveraging Latest PTO and Court Guidance — Overcoming Challenges of Obviousness and Attacks on Patent Validity" on October 30, 2018 from 1:00 to 2:30 pm (EDT). William R. Reid and Jon L. Schuchardt of Dilworth IP will provide patent counsel with guidance on the evolving obviousness standard, including how the Federal Circuit's treatment of obviousness issues is changing, and how the Patent Trial and Appeal Board (PTAB) handles obviousness in the increasingly popular inter partes review (IPR) proceedings. The webinar will review the following issues:

• How have recent Federal Circuit decisions impacted application of the obviousness standard?
• What level of "unexpected results" is needed to demonstrate patentability?
• How can practitioners leverage recent decisions in which the Federal Circuit has insisted upon more thorough, reasoned explanations of the PTO's obviousness conclusions?
• What strategies should patentees and petitioners employ to prevail on obviousness assertions in an IPR proceeding, and how will those strategies fare at the Federal Circuit?

The registration fee for the webcast is $297. Those interested in registering for the webinar, can do so here.
European Biotech Patent Law Webinar

October 20, 2018

D Young & Co will be offering its next European biotech patent law update on October 30, 2018. The webinar will be offered at three times: 5:00 am, 8:00 am, and 1:00 pm (EDT). D Young & Co European Patent Attorneys Simon O'Brien and Matthew Caines will provide an essential update and live Q&A on EPO biotechnology case law.

While there is no fee to participate, attendees must register in advance. Those wishing to register can do so here.
Webinar on University Technology Transfer and Licensing Agreements

October 20, 2018

Strafford will be offering a webinar entitled "University Technology Transfer and Licensing Agreements — Determining Type of Transfer Agreement to Use, Structuring Key Provisions, Overcoming Unique Challenges" on October 30, 2018 from 1:00 to 2:30 pm (EDT). Heather Meeker of O'Melveny & Myers LLP; Christopher Reed, Intellectual Property Officer, UC Santa Cruz; and Sean D. Solberg of Davis Brown Koehn Shors & Roberts will guide counsel for drafting university technology transfer and licensing agreements, and discuss key clauses in the contracts and best practices for negotiating the agreements and avoiding pitfalls unique to the university context. The webinar will review the following issues:

• Key provisions to include in university technology transfer and licensing agreements
• Managing unique challenges that arise when contracting with university personnel
• Tactics to resolve commonly disputed issues during the negotiation of technology transfer and licensing agreements

The registration fee for the webcast is $297. Those interested in registering for the webinar, can do so here.
PTAB Life Sciences Report

October 18, 2018

By Bryan Helwig —

About the PTAB Life Sciences Report: We will periodically report on developments at the PTAB involving life sciences patents.

Eli Lilly and Company v. Teva Pharmaceuticals International GmbH

PTAB Petition: IPR2018-01710; filed September 28, 2018. View Petition here.

Patent at Issue: U.S. Patent No. 8,586,045, ″Methods of using anti-CGRP antagonist antibodies″ describes methods for preventing or treating CGRP associated disorders including headaches and hot flashes by administering an anti-CGRP antagonist antibody. Antagonist antibody G1 and antibodies derived from G1 directed to CGRP are also described in the patent.

Background: Petitioner claims that by the time Teva filed its first application in November 2005, the CGRP pathway was a clinically validated target for treating migraines. Further, Petitioner asserts that a published, double-blind, placebo-controlled clinical trial by Olesen et al. that associated CGRP blockade with migraine relief was not before the USPTO during examination of the '045 patent. Petitioner asserts that the ′045 patent is available for IPR based on Teva's assertions to the USPTO that it is entitled to a pre-AIA filing date of November 14, 2005.

Related Matters:
• On October 24, 2017, Teva filed declaratory judgment action, that Lilly's investigational drug galcanezumab infringed U.S. Patent Nos. 8,586,045; 8,597,649; 9,266,951; 9,340,614; and 9,346,881.
• On February 6, 2018, Teva filed another declaratory action, seeking a declaration that Lilly's product will infringe U.S. Patent Nos. 9,884,907 and 9,884,908. A week later, Teva amended its complaint in the second-filed action to incorporate U.S. Patent Nos. 9,890,210 and 9,890,211.
• On September 27, 2018, the District Court dismissed Teva's Amended Complaints in both declaratory judgment actions. Later that day, Teva filed a third action for patent infringement for the same patents. The patents in the litigations purport to claim priority to the same U.S. provisional application as the '045 patent.
• On August 8, 2018, Lilly filed petitions for inter partes review against U.S. Patent Nos. 9,340,614; 9,266,951; 9,346,881; 9,890,210; 9,890,211; and 8,597,649. These petitions are pending before the Board as IPR2018-01422, IPR2018-01423, IPR2018-01424, IPR2018-01425, IPR2018-01426, and IPR2018-01427, respectively.
• Lilly filed PGR2018-01711 against Teva Pharmaceuticals on October 1, 2018, against U.S. Patent No. 9,884,907, ″Methods for treating headache using antagonist antibodies directed against calcitonin gene-related peptide″. View Petition here.

Hubei Grand Life Science and Technology Co. v. Vitaworks IP, LLC

PTAB Petition: IPR2018-01766; filed September 28, 2018. View Petition here.

Patent at Issue: U.S. Patent No. 9,428,450, ″Process for producing taurine from alkali taurinates″ is directed at a process for producing taurine from alkali ditaurinate or alkali tritaurinate, or their mixture, comprising the conversion of alkali ditaurinate to dialkali ditaurinate or alkali tritaurinate to trialkali tritaurinate, or their mixture, the ammonolysis reaction of ammonia added to a solution of dialkali ditaurinate or trialkali tritaurinate, or their mixture, to yield alkali taurinate, removing excess ammonia from the foregoing and neutralizing alkali taurinates with an acid to form a crystalline suspension of taurine, and recovering taurine by means of solid-liquid separation.

Background: Petitioner challenges claims 1 and 3-7 of the ′450 patent. Petitioner claims that patent claims are directed to a method of industrial taurine synthesis that is neither innovative nor novel. Rather, Petitioner claims that the synthesis of taurine through ammonolysis of an isethionate salt has been known for at least 80-plus years. Further, the Petitioner claims that the identity of the byproducts has also been known for decades and, that it is known that the byproducts, can convert to and from alkali taurinate through an equilibrium reaction. The Petitioner also asserts that the other claim limitations are simply recitations of basic organic synthesis techniques that are known in the art.

Related Matters:
The ′450 patent is subject to pending U.S. District Court litigations in the District of New Jersey:
• Vitaworks IP, LLC v. Qianjiang Yongan Pharmaceutical Co., No. 2:17-cv-06849-CCC-MF; filed Sept. 6, 2017; and
• Vitaworks, LLC v. Qianjiang Yongan Pharmaceutical Co., No. 2:16-cv-05321-CCC-MF; filed Aug. 31, 2016.
• Petitioner filed IPR2018-01767 on September 28, 2108 against U.S. Patent No. 9,428,451, ″Cyclic process for the production of taurine from alkali isethionate".
• Petitioner filed IPR2018-01768 on September 28, 2018 against U.S. Patent No. 9,573,890, ″Process for producing taurine″.

Adello Biologics, LLC v. Amgen Inc.

PTAB Petition: PGR2019-00001; filed October 01, 2018. View Petition here.

Patent at Issue: U.S. Patent No. 9,856,287, ″Refolding proteins using a chemically controlled redox state″ describes a method of refolding proteins expressed in non-mammalian cells present in concentrations of 2.0 g/L or higher. The method comprises identifying the thiol pair ratio and the redox buffer strength to achieve conditions under which efficient folding at concentrations of 2.0 g/L or higher is achieved and can be employed over a range of volumes, including commercial scale.

Background: Petitioner asserts that claims 1-30 of the ′287 patent recite methods of refolding proteins expressed in a nonmammalian expression system by a simple two-step process: (1) contacting the proteins with a buffer having certain characteristics, and (2) incubating the mixture of the proteins and buffer. Petitioner claims that that it is more likely than not that each of the challenged claims is unpatentable for failing to satisfy the written description and enablement requirements, unpatentable as indefinite, and unpatentable as anticipated and rendered obvious by the prior art.

Related Matters:
• The ′287 patent claims priority to U.S. Patent No. 8,952,138. Claims 1-17 and 19-24 of the ′138 patent were found unpatentable by the PTAB on February 15, 2018.

Genome & Co. v. University of Chicago

PTAB Petition: PGR2019-00002; filed October 02, 2018. View Petition here.

Patent at Issue: U.S. Patent No. 9,855,302, ″Treatment of cancer by manipulation of commensal microflora″ describes methods of treatment and/or prevention of cancer by manipulation of commensal microflora. In particular, the amount, identity, presence, and/or ratio of microflora (e.g., gut microflora) in a subject is manipulated to facilitate one or more co-treatments.

Background: Petitioner seeks PGR and cancellation of claims 1–29 of the ′302 patent. Petitioner assets that the claims cover methods of treating any and all cancers in a human subject by co-administering the combination of any and all immune checkpoint inhibitors and any and all species of Bifidobacterium. The Petitioner further asserts that the disclosure of the ′302 patent provides a list of over 165 types of cancer, tens of "immune checkpoint inhibitors," including any protein or protein fragment that binds to an immune checkpoint protein, and 36 different genera of Bifidobacterium, including "Bifidobacterium sp" including any yet to be discovered species of Bifidobacterium. In contrast, the Petitioner notes that the actual experimental evidence reported in the ′302 patent does not support the claims.

Medtronic, Inc. v. Board of Regents, University of Texas System

PTAB Petition: IPR2019-00037; filed October 9, 2018. View Petition here.

Patent at Issue: U.S. Patent No. 6,596,296, ″Drug releasing biodegradable fiber implant" is directed at tissue engineering compositions and methods wherein three-dimensional matrices for growing cells are prepared for in vitro and in vivo use. The matrices comprise biodegradable polymer fibers capable of the controlled delivery of therapeutic agents. The spatial and temporal distribution of released therapeutic agents is controlled by use of defined nonhomogeneous patterns of therapeutic

Background: Petitioner challenges claims 1-7, 10, 11, 16, 20-23, 25, 26, 31, and 32 of the ′296 patent. Petitioner asserts that the challenged claims recite a composition of a biodegradable polymer fiber composed of two distinct phases that are immiscible, where one of the phases includes a therapeutic agent. Petitioner asserts that this type of fiber was known well before the claimed effective filing date of the ′296 patent. Petitioner cites art from the 1990s using different types of biodegradable polymers for delivering different types of drugs as being well known to those skilled in the art.

Medtronic, Inc. v. Board of Regents, University of Texas System

PTAB Petition: IPR2019-00038; filed October 9, 2018. View Petition here.

Patent at Issue: U.S. Patent No. 7,033,603, ″Drug releasing biodegradable fiber for delivery of therapeutics″ is directed at fiber compositions comprising gels or hydrogels. The invention further relates to the composition of a gel or hydrogel loaded biodegradable fiber and methods of fabricating such fibers. The patent further describes tissue engineering and drug-delivery compositions and methods wherein three-dimensional matrices for growing cells for in vitro and in vivo use. Finally, the patent describes methods of manipulating the rate of therapeutic agent release by changing both the biodegradable polymer properties as well as altering the properties of the incorporated gel or hydrogel.

Background: Petitioner challenges claims 1, 2, 4–6, 11–13, 15–19, 21, 22, 24–26, and 31–33 of the ′603 patent. Petitioner challenges that drug-delivery fibers, including those using biodegradable polymers, gels, and hydrogels, were well known before the claimed effective filing date of the '603 patent. Petitioner asserts that the challenged claims are anticipated under 35 U.S.C. § 102(a), (b), and (e) and rendered obvious under 35 U.S.C. § 103(a).
Data Engine Technologies LLC v. Google LLC (Fed. Cir 2018)

October 17, 2018

By Michael Borella —

Data Engine Technologies (DET) filed an infringement suit against Google in the District of Delaware contending infringement of U.S. Patent Nos. 5,590,259, 5,784,545, 6,282,551, and 5,303,146. Google responded with a Rule 12(c) motion arguing that the patents are directed to patent-ineligible subject matter under 35 U.S.C. § 101. The District Court agreed and invalidated the patents. DET appealed.

In Alice Corp. v. CLS Bank Int'l, the Supreme Court set forth a two-part test to determine whether claims are directed to patent-eligible subject matter under § 101. One must first decide whether the claim at hand is directed to a judicially-excluded law of nature, a natural phenomenon, or an abstract idea. If so, then one must further decide whether any element or combination of elements in the claim is sufficient to ensure that the claim amounts to significantly more than the judicial exclusion. But generic computer implementation of an otherwise abstract process does not qualify as "significantly more," nor will elements that are well-understood, routine, and conventional lift the claim over the § 101 hurdle.

For purposes of the Alice analysis, the Federal Circuit divided the patents into two groups: the '259, '545, and '551 patents in one and the '146 patent in the other.

The Tab Patents

The patents of the first group are directed to tabbed interfaces in spreadsheets. With priority dates going back to 1992, these patents allege improvements over spreadsheets (at the time) that did not use tabbed interfaces. In the words of the Court:

In contrast to conventional electronic spreadsheets, the method claimed in the Tab Patents includes user-familiar objects, i.e., paradigms of real-world objects which the user already knows how to use such as notebook tabs. In this manner, complexities of the system are hidden under ordinary, everyday object metaphors, providing a highly intuitive interface—one in which advanced features (e.g., three-dimensionality) are easily learned.

In essence, the invention involves tabs familiar to anyone who has used a modern spreadsheet such as Microsoft Excel.

According to the patents, this interface has several advantages. Notably, "instead of finding information by scrolling different parts of a large spreadsheet, or by invoking multiple windows of a conventional three-dimensional spreadsheet, the present invention allows the user to simply and conveniently 'flip through' several pages of the notebook to rapidly locate information of interest."

In what may have been a determinative move, DET submitted several articles from popular magazines (e.g., PC World and InfoWorld) at the time of the invention lauding the advantages of new spreadsheet software packages that used tabs. The articles noted that managing the complexity of large spreadsheets had long been a problem for users, and existing, non-tabbed spreadsheets would have data and results distributed in an unorganized fashion. The introduction of tabbing elegantly solved this problem.

Claim 12 of the '259 patent, which was one of the representative claims, recites:

12. In an electronic spreadsheet system for storing and manipulating information, a computer-implemented method of representing a three-dimensional spreadsheet on a screen display, the method comprising:
    displaying on said screen display a first spreadsheet page from a plurality of spreadsheet pages, each of said spreadsheet pages comprising an array of information cells arranged in row and column format, at least some of said information cells storing user-supplied information and formulas operative on said user-supplied information, each of said information cells being uniquely identified by a spreadsheet page identifier, a column identifier, and a row identifier;
    while displaying said first spreadsheet page, displaying a row of spreadsheet page identifiers along one side of said first spreadsheet page, each said spreadsheet page identifier being displayed as an image of a notebook tab on said screen display and indicating a single respective spreadsheet page, wherein at least one spreadsheet page identifier of said displayed row of spreadsheet page identifiers comprises at least one user-settable identifying character;
    receiving user input for requesting display of a second spreadsheet page in response to selection with an input device of a spreadsheet page identifier for said second spreadsheet page;
    in response to said receiving user input step, displaying said second spreadsheet page on said screen display in a manner so as to obscure said first spreadsheet page from display while continuing to display at least a portion of said row of spreadsheet page identifiers; and
    receiving user input for entering a formula in a cell on said second spreadsheet page, said formula including a cell reference to a particular cell on another of said spreadsheet pages having a particular spreadsheet page identifier comprising at least one user-supplied identifying character, said cell reference comprising said at least one user-supplied identifying character for said particular spreadsheet page identifier together with said column identifier and said row identifier for said particular cell.

Claim 1 of the '551 patent recites:

1. In an electronic spreadsheet for processing alphanumeric information, said . . . electronic spreadsheet comprising a three-dimensional spreadsheet operative in a digital computer and including a plurality of cells for entering data and formulas, a method for organizing the three-dimensional spreadsheet comprising:
    partitioning said plurality of cells into a plurality of two-dimensional cell matrices so that each of the two-dimensional cell matrices can be presented to a user as a spreadsheet page;
    associating each of the cell matrices with a user-settable page identifier which serves as a unique identifier for said each cell matrix;
    creating in a first cell of a first page at least one formula referencing a second cell of a second page said formula including the user-settable page identifier for the second page; and
    storing said first and second pages of the plurality of cell matrices such that they appear to the user as being stored within a single file.

Starting with claim 12, the Court quickly concluded that the invention therein was "directed to a specific method for navigating through three-dimensional electronic spreadsheets" rather than an abstract idea. Relying on the teachings of the specification that prior art spreadsheet technology was not user-friendly, the Court found that the claimed method "provides a specific solution to then-existing technological problems" that were unique to computers. Particularly, the tabbed interface offers "a highly intuitive, user-friendly interface with familiar notebook tabs for navigating the three-dimensional worksheet environment." The Court also seemed persuaded by the contemporaneous article lauding the benefits of the tabbed interface.

The Court made analogies to claims found patent-eligible in Core Wireless Licensing S.A.R.L. v. LG Elecs., Inc. Notably, "claim 12 recites a 'specific' and 'particular' manner of navigating a three-dimensional spreadsheet that improves the efficient functioning of computers." Another analogy was made to the patent-eligible claims of Trading Technologies International, Inc. v. CQG, Inc. where "a specific, structured graphical user interface paired with a prescribed functionality directly related to the graphical user interface's structure that is addressed to and resolves a specifically identified problem in the prior state of the art."

Google argued that claim 12 was directed to no more than organizing and presenting information. But the cases that Google relied upon (Affinity Labs of Texas, LLC v. DirecTV, LLC, Intellectual Ventures I LLC v. Capital One Financial Corp., and Intellectual Ventures I LLC v. Erie Indemnity Co.) all involved claims that were functional in nature, described an outcome rather than specific steps that can be taken to achieve that outcome, and/or lacked a non-abstract improvement to computer technology. The Court also distinguished claim 12 over those of Electric Power Group, LLC v. Alstom S.A., noting that this claim was directed to a specific improvement to how computers operate rather than just collecting, organizing, and displaying data.

Google also argued that humans have long-used tabs to organize information in notebooks, binders, and so on. The Court responded:

We agree that tabs existed outside the context of electronic spreadsheets prior to the claimed invention. It is not enough, however, to merely trace the invention to some real-world analogy. The eligibility question is not whether anyone has ever used tabs to organize information. That question is reserved for §§ 102 and 103. The question of abstraction is whether the claim is "directed to" the abstract idea itself. We must consider the claim as a whole to determine whether the claim is directed to an abstract idea or something more. Google fails to appreciate the functional improvement achieved by the specifically recited notebook tabs in the claimed methods. The notebook appearance of the tabs was specifically chosen by the inventors because it is easily identified by users. The tabs are not merely labeled buttons or other generic icons. DET has disclaimed as much. Rather, the notebook tabs are specific structures within the three-dimensional spreadsheet environment that allow a user to avoid the burdensome task of navigating through spreadsheets in separate windows using arbitrary commands.

Consequently, the Court found claim 12 not directed to an abstract idea, and that the second step of the Alice test was not necessary. Thus, all claims of the '259 and '545 patents were deemed patent-eligible.

In contrast, claim 1 of the '551 patent was struck down under § 101. When compared to claim 12, this claim "generically recites associating each of the cell matrices with a user-settable page identifier and does not recite the specific implementation of a notebook tab interface." Therefore, claim 1 is "not limited to the specific technical solution and improvement in electronic spreadsheet functionality that rendered representative claim 12 of the '259 patent eligible . . . [i]nstead, claim 1 . . . covers any means for identifying electronic spreadsheet pages."

Declaring claim 1 abstract due to this rationale, the Court moved on the second step of Alice — the search for an inventive concept in the additional elements of the claim that renders the claim significantly more than abstract. Ultimately, the Court found that the elements of "partitioning cells to be presented as a spreadsheet, referencing in one cell of a page a formula referencing a second page, and saving the pages such that they appear as being stored as one file . . . merely recite the method of implementing the abstract idea itself."

Accordingly, the Court held that claim 1 did not meet the requirements of § 101, and was therefore patent-ineligible. But the remaining asserted claims of the '551 patent were upheld based on the reasoning applied to claim 12 of the '259 patent.

The '146 Patent

The '146 patent is "directed to methods that allow electronic spreadsheet users to track their changes." In the prior art, spreadsheets "provided little or no tools for creating and managing such a multitude of [what-if] scenarios." This resulted in users having to "resort to manually creating separate copies of the underlying model, with the user responsible for tracking any modifications made in the various copies."

The solution provided by the '146 patent is "an electronic spreadsheet system having a preferred interface and methods for creating and tracking various versions or 'scenarios' of a data model." The invention "includes tools for specifying a 'capture area,' that is, a specific set of information cells to be tracked and an Identify Scenario tool for automatically determining changes between a captured parent or baseline model and a new scenario."

Claim 1 of the '146 patent recites:

1. In an electronic spreadsheet system for modeling user-specified information in a data model comprising a plurality of information cells, a method for automatically tracking different versions of the data model, the method comprising:
    (a) specifying a base set of information cells for the system to track changes;
    (b) creating a new version of the data model by modifying at least one information cell from the specified base set; and
    (c) automatically determining cells of the data model which have changed by comparing cells in the new version against corresponding ones in the base set.

The Court rapidly concluded that the claim was "directed to the abstract idea of collecting spreadsheet data, recognizing changes to spreadsheet data, and storing information about the changes" because "[t]he concept of manually tracking modifications across multiple sheets is an abstract idea." Further, the Court found that the claimed invention does not improve spreadsheet technology in a specific, non-abstract fashion. Moving on to step two of Alice, the Court stated that there was nothing more in the claims aside from "simply stating the abstract idea while adding the words 'apply it.'"

Thus, all asserted claims of the '146 patent were invalid under § 101.

Analysis

If the goal is to obtain further insight into the where the line is drawn between inventions that are eligible and ineligible under § 101, this case is not the best place to start. But let's give it a try.

The valid claims explicitly recited navigation of a tabbed spreadsheet interface, were relatively narrow and specific in doing so, and were supported by statements in their specification regarding the technological problems solved thereby. This latter point was bolstered by extrinsic evidence from contemporaneous publications. On the other hand, the invalid claims were broader and not specific to navigating a tabbed interface. Despite evidence that all claims under review were directed to an improvement in spreadsheet technology, the claims ultimately found invalid were viewed by the Court as conceptual rather than concrete, most likely due to their relative lack of detail.

Also, this case further raises issues of how to differentiate between the analyses of §§ 101, 102, and 103 — particularly, the role of prior art in the § 101 inquiry. The Court wrote that "[t]he eligibility question is not whether anyone has ever used tabs to organize information . . . [t]hat question is reserved for §§ 102 and 103," and "[t]he question of abstraction is whether the claim is directed to the abstract idea itself." But the Court's conclusion that some of the claims were valid seemed to be heavily based on how these claims recited an improvement over the prior art of the time. The Federal Circuit remains schizophrenic regarding this matter.

Data Engine Technologies LLC v. Google LLC (Fed. Cir 2018)
Panel: Circuit Judges Reyna, Bryson, and Stoll
Opinion by Circuit Judge Stoll
Canada Legalizes Cannabis, Time to Re-evaluate Your Canna-IP Protection?

October 17, 2018

By George "Trey" Lyons, III, Nicole Grimm, and Brett Scott —

This morning, Canada became the second country in the world to legalize cannabis across the board.[1] As much of the world wonders what will become of this "national experiment," many of us in the IP industry contemplate the impact Canada's legal landscape will have on canna-IP rights, both in the U.S. and abroad. As we've noted in other posts and articles, cannabis innovators and companies should do all that they can to protect their IP in this burgeoning market and evolving legal landscape.[2] Other companies have certainly done so, and will continue to do so, particularly in light of continuing international acceptance and protection.[3] Economy breeds innovation, and the seismic step forward by our neighbor to the north today will certainly have effects on strategies for protecting these rights going forward. And, who knows, here's to hoping it may have broader impacts on cannabis legalization and protection in the U.S., in spite of those who continue to oppose these efforts.[4]

[1] Canada has authorized medicinal cannabis usage since 2001, but today legalized both full recreational and cultivation usages. For context, Uruguay was the first country to legalize all three usages—albeit with different limitations than those enacted in Canada.

[2]See, e.g., "Protect Your IP," Cannabis Business Times, available at http://www.cannabisbusinesstimes.com/article/protect-your-ip/.

[3] See, e.g., "Biotech Institute's Growing Patent Portfolio — U.S. Patent No. 9,095,554 and the Path Forward", Patent Docs, available at http://www.patentdocs.org/2017/11/biotech-institutes-growing-patent-portfolio-us-patent-no-9095554-and-the-path-forward.html; "Considerations for Canna-Patent Owners and Applicants in Light of Insys Development Co. v. GW Pharma Ltd.", Patent Docs, available at http://www.patentdocs.org/2018/05/considerations-for-canna-patent-owners-and-applicants-in-light-of-insys-development-co-v-gw-pharm-lt.html;

[4] See, e.g., "Sessions's War on the Cole Memo and the New Frontier for the Canna-IP Industry", Patent Docs, available at http://www.patentdocs.org/2018/01/sessionss-war-on-the-cole-memo-and-the-new-frontier-for-the-canna-ip-industry.html.
Ex parte Bolivar (PTAB 2018)

October 16, 2018

PTAB Affirms Patent Eligibility of Claims for Using Dwell Time to Rank Search Results

By James Korenchan —

In a decision issued last month, the Patent Trial and Appeal Board of the U.S. Patent and Trademark Office reversed the final rejection of all pending claims in U.S. Application No. 12/814,020, for which the real party in interest is eBay.

The claims at issue are directed to methods and systems for managing how search results are ranked and presented to a user of a trading or e-commerce application. The application aims to balance the desires of buyers, sellers, and intermediaries, to best present "items" (i.e., products and services) that are being offered for sale, to increase the chances that a "transaction" (e.g., a sale) involving such items will occur. To accomplish this, the claimed invention involves ranking listings based at least in part on "dwell time" — that is, the amount of time that the user spends interacting with or viewing a webpage containing information about a listing of an item for sale. More particularly, dwell time refers to the time that elapses between when the user navigates to such a page from a display of search results and when the user navigates away from the page.

The claims had been rejected under 35 U.S.C. § 101 as being directed to an abstract idea. Representative claim 18 is shown below. The other independent claims (a system and CRM) recite similar limitations.

18. A method comprising:
    identifying a plurality of listings stored in a listing database as search results;
    determining, using a processor, a respective dwell time associated with each of the plurality of listings, the dwell time based on an elapsed amount of time one or more users view a page describing the listing, and the dwell time associated with a likelihood o f a transaction occurring with respect to the listing; and
    ranking the listings composing the identified plurality of listings based at least in part on the respective dwell time associated with each of the plurality of listings.

The bulk of the Examiner's position analogized the claims to advertising, at one point calling the claims a "business model for advertising on the web." More particularly, the Examiner cited the Federal Circuit's decisions in Cyberfone and Digitech, arguing that the claims are directed to the abstract idea of "organizing search listings, a type of advertising, ranked by the time that a user views the advertisement" or, put simply, "sales and marketing actions or behaviors." The Examiner also argued that claims recite generic computer functionality and do not recite any limitations that would add significantly more than the alleged abstract idea.

In the briefing, the Appellants attempted to argue that the Examiner did not establish a prima facie case of patent-ineligibility, but the Board disagreed. The Appellants also argued that the claims are directed not to advertising, but rather to a "specific way in which relevant search result can be identified and ranked" (i.e., using dwell time), and thus provide an improvement to computer technology similar to patent-eligible claims in cases such as DDR Holdings. The Board agreed with this argument, particularly noting the recited use of dwell time and how the invention, similar to that in DDR Holdings, addresses an "Internet-centric challenge":

We determine claim 1 is directed not only to the "business idea" of organizing (ranking) search results, but claim 1 also is directed to the use of dwell time, which is an Internet-centric challenge. . . . Thus, just as in DDR Holdings, here Appellants' claim 1 is not directed to an abstract idea because it does "not merely recite the performance of some business practice known from the pre-Internet world along with the requirement to perform it on the Internet." Claim 1 is not directed to an abstract idea because it "is necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks."

(citations omitted)

The Board thus reversed the Examiner's rejections.

While welcome, this decision is further evidence of the Board's inconsistent patent-eligibility determinations. One could imagine a different panel reaching the opposite decision. Still, the bar for patent-eligible improvements to computer technology is often set too high, and this decision is a refreshing entry that lowered the bar.

Another thing worth noting: the Examiner's rejection here appeared to lack a great deal of substance, yet the Board did not agree as much. For example, the Appellants repeatedly pointed out in their briefings and responses that the Examiner did not attempt to articulate why the claims are similar to Cyberfone and Digitech. Less substantive § 101 rejections weren't all that uncommon years ago (and occur a bit too often even today), but it is still a bit surprising that the Board dismissed the Appellants' arguments to this point despite so matter-of-factly reaching a conclusion of patent-eligibility in this short decision.

Ex parte Bolivar (PTAB 2018)
Panel: Administrative Patent Judges Strauss, Barry, and Bennett
Decision on Appeal by Administrative Patent Judge Barry
Supernus Pharmaceuticals, Inc. v. TWi Pharmaceuticals, Inc. (Fed. Cir. 2018)

October 14, 2018

By Donald Zuhn —

Last month, in Supernus Pharmaceuticals, Inc. v. TWi Pharmaceuticals, Inc., the Federal Circuit affirmed a decision by the U.S. District Court for the District of New Jersey finding that U.S. Patent Nos. 7,722,898; 7,910,131; and 8,821,930 were not invalid and would be infringed by Defendants-Appellants TWi Pharmaceuticals, Inc. and TWi International LLC, DBA TWi Pharmaceuticals. The '898, '131, and '930 patents are owned by Plaintiff-Appellee Supernus Pharmaceuticals, Inc.

Seeking approval to market generic versions of Oxtellar XR®, an oxcarbazepine extended-release tablet for treatment of partial epilepsy seizures in adults and children over the age of six, TWi filed an Abbreviated New Drug Application (ANDA) with the FDA. In response to that filing, Supernus brought an action for infringement of the '898, '131, and '930 patents, and TWi counterclaimed for invalidity.

The '898, '131, and '930 patents share a common specification, which discloses that twice daily, immediate release formulations of oxcarbazepine were known in the art, but were disadvantageous because they require multiple daily administrations and can result in increased side effects. Sustained release formulations were therefore preferred, but according to the common specification, such formulations were difficult to achieve because oxcarbazepine is poorly soluble in water. The asserted patents provide controlled-release oxcarbazepine formulations for once-a-day administration by (1) using matrix polymers that comprise a homogeneous matrix structure, and (2) incorporating a combination of solubility-enhancing excipients and/or release-promoting agents into the formulations to enhance the bioavailability of oxcarbazepine and its derivatives. Claim 1 of the '898 patent recites:

1. A pharmaceutical formulation for once-a-day administration of oxcarbazepine comprising a homogeneous matrix comprising:
    (a) oxcarbazepine;
    (b) a matrix-forming polymer selected from the group consisting of cellulosic polymers, alginates, gums, cross-linked polyacrylic acid, carageenan, polyvinyl pyrrolidone, polyethylene oxides, and polyvinyl alcohol;
    (c) at least one agent that enhances the solubility of oxcarbazepine selected from the group consisting of surface active agents, complexing agents, cyclodextrins, pH modifying agents, and hydration promoting agents; and
    (d) at least one release promoting agent comprising a polymer having pH-dependent solubility selected from the group consisting of cellulose acetate phthalate, cellulose acetate succinate, methylcellulose phthalate, ethylhydroxycellulose phthalate, polyvinylacetate phthalate, polyvinylbutyrate acetate, vinyl acetate-maleic anhydride copolymer, styrene-maleic mono-ester copolymer, and Eudragit L100-55 (Methacrylic Acid-Ethyl Acrylate Copolymer (1:1)), and methyl acrylate-methacrylic acid copolymers.

The claim limitations at issue on appeal are shown in bold-italics.

At trial, the District Court held a Markman hearing and construed (1) the claim term "at least one agent that enhances the solubility of oxcarbazepine" (referred to by the Federal Circuit as the "solubility agent limitation") as "an agent, other than oxcarbazepine, that enhances the solubility of oxcarbazepine, which agent cannot also serve as the sole matrix-forming polymer in 1(b) or the sole release promoting agent in 1(d) in claim 1," and (2) the claim term "homogeneous matrix" as a "matrix in which the ingredients or constituents are uniformly dispersed." In between the Markman hearing and a bench trial, the District Court decided a related case, Supernus Pharms., Inc. v. Actavis Inc. (D.N.J. Feb. 5, 2016), which involved the same plaintiff and asserted patents, but different defendants and accused products. In that case, the District Court determined that the asserted patents were not invalid and would be infringed. Following the bench trial in the instant case, the District Court determined that the asserted patents were not invalid and would be infringed by TWi's proposed oxcarbazepine extended-release tablets, and that the homogeneous matrix limitation was not indefinite and did not lack adequate written description support in the common specification.

On appeal, TWi argued that the District Court erred (1) by giving its decision in Supernus Pharms., Inc. v. Actavis Inc. de facto preclusive effect in the instant case, (2) in concluding that the proposed tablets would infringe the solubility agent and homogeneous matrix limitations, and (3) in finding the asserted patents not invalid as indefinite or for lack of written description. With respect to TWi's first argument, the Federal Circuit determined that the District Court did not give its decision in Actavis de facto preclusive effect, agreeing with Supernus that "the district court made express findings based on the record presented in this litigation and relied on Actavis only to the extent that the records were similar or the parties had agreed to be bound by a subsidiary conclusion from Actavis." The Federal Circuit also disagreed with TWi's argument that the District Court improperly relied on results from tests that were admitted as evidence in Actavis, but not in the instant case, finding that "[t]o the contrary, the district court made only a passing reference to the Oxtellar XR® tests, and based its infringement determination solely on tests and evidence admitted in this litigation" (citation omitted).

With respect to TWi's second argument, the opinion notes that TWi contended that its tablets could not satisfy the solubility agent limitation because the common specification, at Table 1, characterizes a formulation that contains the accused agent in TWi's tablets, but not a release-promoting agent, as a "non-enhanced" formulation. In particular, TWi pointed to disclosure in the common specification stating that "improvements were made to the formulations by incorporating solubility enhancers and/or release-promoting excipients (such formulation[s] are referred to as enhanced formulations)" (emphasis in opinion), and arguing that the term "and/or" in this statement means "and" or "or". Supernus, however, argued that in the context of the common specification, "and/or" means solely "and," and the District Court sided with Supernus on the issue. The Federal Circuit agreed with Supernus and the District Court, reading "enhanced" formulations, in the context of the common specification, to require both a "combination of solubility and release promoters." In particular, the Federal Circuit noted that "the common specification describes the presence of both a solubility agent and a release-promoting agent as essential to formulating an 'enhanced' formulation" (emphasis in opinion).

TWi also argued that the District Court failed to apply its own construction of the solubility agent limitation, which the District Court agreed implicitly required that the solubility agent enhance solubility by more than a de minimis amount. The Federal Circuit, however, noted that "the district court did not use the magic words 'de minimis,'" and instead "found, consistent with expert testimony, that the patents do not require any specific amount of enhancement and that the accused agent enhanced solubility by a statistically significant amount." "That TWi disagrees with the district court's assessment that a statistically significant increase satisfies the claim limitation as construed," the opinion explains, "is not grounds for error."

Regarding the homogeneous matrix limitation, TWi argued that the District Court changed its construction of that term from a "matrix in which the ingredients or constituents are uniformly dispersed," as construed in the Court's Markman order, to "no localization of constituents," as stated in the Court's post-trial decision. The Federal Circuit, however, concluded that the "district court did not change the construction of the term in its post-trial decision, but rather clarified what was already inherent in its construction, as permitted." More specifically, the Federal Circuit explained that:

[T]he district court stated, the term "was added to the claims to distinguish Supernus's invention, which has all four matrix components in the tablet core, from the prior art references, which contained certain matrix constituents solely in the coating, which the Patent Examiner viewed to be part of the matrix." Thus, the district court clarified that inherent in its construction of "homogeneous matrix" is this understanding that, where the degree of uniformity is irrelevant, "uniformly dispersed" necessarily implicates an absence of localization [citations omitted].

As for TWi's third argument, the Federal Circuit determined that the District Court did not err in finding that the "homogeneous matrix" limitation was not indefinite and did not lack written description support.

The Federal Circuit therefore affirmed the District Court's decision that that the asserted patents were not invalid and would be infringed by TWi's proposed tablets.

Supernus Pharmaceuticals, Inc. v. TWi Pharmaceuticals, Inc. (Fed. Cir. 2018)
Nonprecedential disposition
Panel: Circuit Judges O'Malley, Clevenger, and Stoll
Opinion by Circuit Judge O'Malley
PTAB Adopts Litigation Standards for Claim Construction in AIA Proceedings

October 11, 2018

By Josh Rich —

Under a new PTO administrative rule published today, the PTAB will apply the same claim construction standards in IPRs, PGRs, and CBMs filed on November 13, 2018 or later as would apply in litigation. 83 Fed. Reg. 51340 (Oct. 11, 2018). The PTAB will also consider claim construction decisions from litigation (whether from courts or the U.S. International Trade Commission) in construing claims in AIA proceedings. The new rule abandons the PTO's former approach of using the broadest reasonable interpretation ("BRI") in claim construction, and thereby reflects a continuing move from considering AIA proceedings analogous to prosecution to considering them analogous — or part of — the litigation process.

Currently, the PTAB uses the BRI to construe claims in the vast majority of AIA proceedings, the only exceptions being in cases where the patent has expired or is expiring imminently.[1] In doing so, it has treated the AIA proceedings as analogous to a continuation of prosecution (in which claims are given their broadest reasonable interpretation throughout the process). That approach makes sense in the historical context of AIA proceedings, given that it allows the PTO to use the same approach across almost all cases before it, AIA proceedings are to supplement — not reargue — issues that were presented during pre-issuance prosecution, and AIA proceedings share many similarities with prosecution (including limited ability to address the counterparty's claim construction arguments). Furthermore, the ability to amend claims during such proceedings provides a "safety valve" for an inopportune, overbroad claim construction.

However, practice has shown that parties are treating AIA proceedings like an aspect of litigation rather than a continuation of prosecution. A 2016 article cited repeatedly in the PTO's rule indicates that 86.8% of patents involved in AIA proceedings were also the subject of litigation or ITC investigations, and the PTO assumed that the pattern was continuing to date.[2] That is, AIA proceedings have been considered one front in an adversarial war rather than independent actions to ensure that patents had been properly granted. Furthermore, the differing claim construction standards in the different actions created at least the impression — if not the reality — that parties could leverage the differing standards to argue two inconsistent claim constructions in different fora, leading to inefficiency, lack of uniformity, and potential unfair outcomes.[3] In that context, it makes sense to use the same approach in all aspects of the disputes and to allow claim construction in one part of the dispute to inform claim construction in the other parts.

The standard used for claim construction in litigation, and soon AIA proceedings, is that discussed in Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc), and its progeny. Under that approach,

[C]laim construction begins with the language of the claims. Phillips, 415 F.3d at 1312-14. The "words of a claim are generally given their ordinary and customary meaning," which is "the meaning that the term would have to a person of ordinary skill in the art in question at the time of the invention, i.e., as of the effective filing date of the patent application." Id. at 1312-13. The specification is "the single best guide to the meaning of a disputed term and . . . acts as a dictionary when it expressly defines terms used in the claims or when it defines terms by implication." Id. at 1321 (internal quotation marks omitted). Although the prosecution history "often lacks the clarity of the specification and thus is less useful for claim construction purposes," it is another source of intrinsic evidence that can "inform the meaning of the claim language by demonstrating how the inventor understood the invention and whether the inventor limited the invention in the course of prosecution, making the claim scope narrower than it would otherwise be." Id. at 1317. Extrinsic evidence, such as expert testimony and dictionaries, may be useful in educating the court regarding the field of the invention or helping determine what a person of ordinary skill in the art would understand claim terms to mean. Id. at 1318-19. However, extrinsic evidence in general is viewed as less reliable than intrinsic evidence. Id.

83 Fed. Reg. at 51343.

Notably, the new rule recognizes — and adopts — the canon of construction that claims will be construed, if possible, to preserve their validity. Id. Phillips asserted that the doctrine is "of limited utility" and should be limited to cases in which "the court concludes, after applying all the available tools of claim construction, that the claim is still ambiguous." Id. (citing Phillips, 415 F.3d at 1328, 1327). Setting aside the propriety of using such a canon of construction in litigation (as opposed to finding the claims indefinite), the decision to import it into AIA proceedings is significantly more troubling. A patent owner may amend ambiguous claims in AIA proceedings, an option not available in litigation. But just as fundamentally, it seems improper for the PTAB to put its "thumb on the scale" in favor of validity when the validity of the claims is the underlying issue.

On the other hand, the wholesale adoption of the Phillips standard for claim construction provides a clear benefit: court and ITC claim constructions will be directly relevant to AIA proceedings, and vice versa. While the outcome of the claim construction process was previously generally the same under either standard, it technically involved different legal standards. See 83 Fed. Reg. at 51348 (citing, inter alia, In re CSB-System Int'l, Inc., 832 F.3d 1335, 1341 (Fed. Cir. 2016)). That distinction led the PTAB to ignore litigation-based constructions and courts to sometimes ignore PTAB decisions. See id. at 51342 (citing Automated Packaging Sys., Inc. v. Free Flow Packaging Int'l, Inc., No. 18-cv-00356, 2018 WL 3659014, at *3 (N.D. Cal. Aug. 2, 2018); JDS Techs., Inc. v. Avigilion USA Corp., No. 15-cv-10385, 2017 WL 4248855, at *6 (E.D. Mich. Jul. 25, 2017)). Now, the decisions in the two types of fora will be directly relevant to one another, increasing efficiency and decreasing cost. And because the rule specifically indicates that "[a]ny prior claim construction determination concerning a term of the claim in a civil action, or a proceeding before the [ITC], that is timely made of record in the . . . proceeding will be considered," the chance of inconsistent decisions will be greatly lessened. See 83 Fed. Reg. at 51345.

The change from BRI to the Phillips standard in claim construction in AIA proceedings will create more uniformity between those proceedings and litigation. At the same time, there are some potential downsides and difficulties. But for those parties who want to proceed under the BRI, the clock is ticking and their petitions must be filed within 30 days.

[1] In proceedings involving expired or soon-to-expire patents, the PTAB was already using the same standard as is used in litigation. See 83 Fed. Reg. at 51341 (citing Wasica Fin. GmbH v. Cont’l Auto. Sys., Inc., 853 F.3d 1272, 1279 (Fed. Cir. 2017)). In such cases, there is no practical way to amend the claims to avoid a finding of invalidity, so there is less reason to consider the proceedings similar to prosecution.

[2] See 83 Fed. Reg. at 51342 (citing Saurabh Vishnubhakat et al., Strategic Decision Making in Dual PTAB and District Court Proceedings, 31 Berkeley Tech. L.J. 45 (2016)), 51344.

[3] See 83 Fed. Reg. at 51343 (citing, inter alia, PPC Broadband, Inc. v. Corning Optical Comm’ns RF, LLC, 815 F.3d 734, 740-42 (Fed. Cir. 2016)); see also 83 Fed. Reg. at 51342 (citing Niky R. Bagley, Treatment of PTAB Claim Construction Decisions: Aspiring to Consistency and Predictability, 32 Berkeley Tech. L.J. 315 (2018); Kevin Greenleaf et al., How Different are the Boradest Reasonable Interpretation and Phillips Claim Construction Standards 15 (2018); and Laura E. Dolbow, A Distinction Without a Difference: Convergence in Claim Construction Standards, 70 Vand. L. Rev. 1071 (2017)).

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