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  • UIC Law Virtual Seminar on Women in IP

    UIC LawThe Center for Intellectual Property, Information & Privacy Law at the University of Illinois Chicago School of Law will be holding a virtual seminar entitled "Women in IP: Opportunities & Challenges" from 12:00 pm to 1:30 pm (CDT) on April 26, 2023.  The program will bring together speakers to discuss the opportunities and challenges of women working in the field of intellectual property law.

    Additional information about the program, including a list of speakers, can be found here.  While there is no fee for this event, those interested in registering for the event can do so here.

  • Webinar on Building a Biotech Patent Portfolio

    IPWatchdogIPWatchdog and CAS will be offering a webinar entitled "Strategies for Adding Value and Building a Strong Biotech Patent Portfolio" on April 27, 2023 at 12:00 pm (ET).  Matthew J. McBride of CAS IP Services; Amy Fix of Barnes & Thornburg; John Astor Cleveland, Jr. of Assembly Biosciences; and Gene Quinn of IPWatchdog, Inc. will discuss how R&D and IP teams can develop holistic approaches for driving IP value during R&D and discuss comprehensive patent and search strategies, from pinpointing the best opportunities for lead selection to ensuring freedom to operate ahead of clinical trials.  The panel will address the following topics:

    • How missing data slows research and creates missed opportunities,
    • Specific strategies for optimizing IP value at each stage of R&D,
    • Proven techniques for improving the quality and speed of preclinical studies,
    • Using all-in freedom to operate searches to pressure test patent claims,
    • Finding new IP value in data emerging during R&D, and
    • How continued analysis can and should lead to stronger claims during commercialization.

    There is no registration fee for this webinar.  However, those interested in registering for the webinar, should do so here.

  • Amgen Inc. v. Sandoz Inc. (Fed. Cir. 2023)

    By Kevin E. Noonan –

    Federal Circuit SealAn appellant's burden on appeal is never easy but it is particularly difficult when the questions at issue are based on factual evidence.  The appellate judiciary is loathe (generally) to second guess a district court judge on factual matters, in deference to the judge's experience in observing the demeanor of the witnesses and how the evidence is introduced, and rebutted on cross-examination by opposing counsel over the course of the trial.  These considerations were evident in the Federal Circuit's decision in Amgen Inc. v. Sandoz Inc.* in which the Court affirmed the decisions below based on the District Court's decisions on the facts.

    The case arose in ANDA litigation over Amgen's apremilast product ((+)-2-[1-(3-ethoxy-4-methoxyphenyl)-2-methylsulfonylethyl]-4-acetylaminoisoindoline-1,3-dione), a phosphodiesterase-4 ("PDE4") inhibitor, used for treating psoriasis and other related conditions and sold under the brand name Otezla®, having the structure:

    Image 1
    Importantly, this compound is "stereochemically pure" (as noted by the Court, meaning it is one of two possible enantiomers, usually analogized for the chemical novice as right-handed or lefthanded).  Three patents were at issue:  U.S. Patent No. 7,427,638 (the '638 patent, wherein Amgen asserted claims 3 and 6); U.S. Patent No. 7,893,101 (the '101 patent, wherein Amgen asserted claims 1 and 15); and U.S. Patent No. 10,092,541 (the '541 patent, wherein Amgen asserted claims 2, 19, and 21).  The asserted claims are as follows:

    The '638 patent (where the independent claims from which the asserted claims depend are set forth as they are in the opinion in italics);

    3.    The pharmaceutical composition [comprising stereomerically pure (+)-2-[1-(3- ethox 4-methoxyphenyl)-2-methylsulfonylethyl]-4- acetylaminoisoindoline-1,3-dione, or a pharmaceutically acceptable salt, solvate or hydrate, thereof; and a pharmaceutically acceptable carrier, excipient or diluent, wherein said pharmaceutical composition is suitable for parenteral, transdermal, mucosal, nasal, buccal, sublingual, or oral administration to a patient], wherein said pharmaceutical composition is suitable for oral administration to a patient.

    6.    The pharmaceutical composition [comprising stereomerically pure (+)-2-[1-(3- ethox 4-methoxyphenyl)-2- methylsulfonylethyl]-4- acetylaminoisoindoline-1,3-dione, or a pharmaceutically acceptable salt, solvate or hydrate, thereof; and a pharmaceutically acceptable carrier, excipient or diluent, wherein said pharmaceutical composition is suitable for parenteral, transdermal, mucosal, nasal, buccal, sublingual, or oral administration to a patient, wherein the amount of stereomerically pure (+)-2-[1-(3-ethoxy-4-methoxyphenyl)-2- methylsulfonylethyl]-4- acetylaminoisoindoline-1,3-dione is from 1 mg to 1000 mg, wherein the amount of stereomerically pure (+)-2-[1-(3-ethoxy-4- methoxyphenyl)-2-methylsulfonylethyl]-4- acetylaminoisoindoline-1,3-dione is from 5 mg to 500 mg], wherein the amount of stereomerically pure (+)-2-[1-(3-ethoxy-4- methoxyphenyl)-2-methylsulfonylethyl]-4- acetylaminoisoindoline-1,3-dione is from 10 mg to 200 mg.

    The '101 patent:

    1.    A Form B crystal form of the compound of Formula (I):

    Image 2
    which is enantiomerically pure, and which has an X-ray powder diffraction pattern comprising peaks at about 10.1, 13.5, 20.7, and 26.9 degrees 2θ.

    15.    A solid pharmaceutical composition comprising the crystal form of any one of claims 1 and 2 to 13.

    The '541 patent:

    2.    A method for treating a patient with stereomerically pure (+)-2-[1-(3-ethoxy-4- methoxyphenyl)-2-methylsulfonylethyl]-4- acetylaminoisoindoline-1,3-dione, wherein the patient is suffering from psoriasis, the method consisting of:
        (a) administering to the patient stereomerically pure (+)-2-[1-(3-ethoxy-4-methoxyphenyl)-2-methylsulfonylethyl]-4-acetylaminoisoindoline-1,3-dione in an initial titration dosing schedule consisting of
            (i) 10 mg in the morning on the first day of administration;
            (ii) 10 mg in the morning and 10 mg after noon on the second day of administration;
            (iii) 10 mg in the morning and 20 mg after noon on the third day of administration;
            (iv) 20 mg in the morning and 20 mg after noon on the fourth day of administration;
            (v) 20 mg in the morning and 30 mg after noon on the fifth day of administration; and
        (b) on the sixth and every subsequent day, administering to the patient 30 mg in the morning and 30 mg after noon of stereomerically pure (+)-2-[1-(3-ethoxy-4- methoxyphenyl)-2-methylsulfonylethyl]- 4-acetylaminoisoindoline-1,3-dione.

    19.    A method as in any one of claims 1–14, wherein the stereomerically pure (+)-2-[1-(3-ethoxy-4-methoxyphenyl)-2-methylsulfonylethyl]-4 acetylaminoisoindoline-1,3-dione comprises greater than about 98% by weight of the (+) isomer of 2-[1-(3-ethoxy-4-methoxyphenyl)-2-methylsulfonylethyl]-4-acetylaminoisoindoline-1,3-dione based on the total weight percent of 2-[1-(3-ethoxy-4-methoxyphenyl)-2-methylsulfonylethyl]-4-acetylaminoisoindoline-1,3-dione.

    21.    A method as in any one of claims 1–14, wherein the stereomerically pure (+)-2-[1-(3- ethoxy-4-methoxyphenyl)-2-methylsulfonylethyl]-4-acetylaminoisoindoline-1,3-dione is administered in tablet form.

    The District Court found that Sandoz failed to show by clear and convincing evidence that the asserted claims of the '638 nor '101 patents were invalid for obviousness but that it had established by clear and convincing evidence that the asserted claims of the '541 patent were invalid for obviousness.  Infringement was stipulated for all asserted claims.

    For the '638 patent, Sandoz proffered in support of its invalidity contentions U.S. Patent No. 6,020,358 and PCT Application No. WO 01/034606.  The '358 patent disclosed a racemic mixture of 2-[1-(3-ethoxy-4-methoxyphenyl)-2-methylsulfonylethyl]-4-acetylaminoisoindoline-1,3-dione wherein the (+) enantiomer is apremilast.  Both the '358 patent and '606 application teach that racemic mixtures (generally) can be resolved into their constituent enantiomers.  But the District Court held that Sandoz had not shown that this art provided a reason or motivation for the skilled artisan to resolve the enantiomers to produce apremilast, because there was no disclosure that the (+) enantiomer had the desirable properties exhibited by the drug.  Nor was the District Court convinced that the cited references would have produced in the skilled worker a reasonable expectation that the enantiomers could be successfully resolved even if there was a motivation to attempt to do so.  The District Court also considered the objective indicia (otherwise known as secondary considerations as designated in the Supreme Court's Graham v. John Deere Co. decision) of non-obviousness, in particular that "apremilast unexpectedly provided substantial improvement over previously known phosphodiesterase inhibitors in terms of both efficacy and tolerability."  In addition, the District Court found a nexus between these unexpected properties and the purified enantiomeric compounds recited in claims 3 and 6 of the '638 patent.  The District Court further found that there was a long-felt but unmet need for the claimed compound, which could be orally administered and not accompanied by "risks and barriers" attendant on other PDE4 inhibitors used in these treatments (with the necessary nexus between the compound and this consideration).  Similarly, the District Court found that others had tried and failed to develop other successful PDE4 inhibitors for such treatments, and that the commercial success of Otezla® supported a conclusion of non-obviousness.

    Turning to the '101 patent, Sandoz argued that this patent was not entitled to the priority date of March 20, 2002, which was the filing date of a provisional application that provided its earliest priority date, but rather should be limited to the filing date of the application from which the '101 patent arose.  This challenge was based on whether Example 2 of that priority application provided written description and enablement support for the asserted claims of the '101 patent.  In addition, Sandoz asserted that Amgen's predecessor in interest (Celgene) for the '101 patent had made representations in a corresponding European application that Example 2 produced another crystalline form of the compound (termed Form C) in addition to Form B claimed in the '101 patent.  The District Court found that the '101 patent was entitled to its earliest priority date.  In addition, the District Court held that with regard to Example 2, while not explicitly disclosing the final crystal form claimed in the '101 patent, the Court accepted the testimony of Amgen's expert that the Example 2 disclosure inherently produced Form B of the claimed compound supported by "thirteen third-party experiments that replicated the procedures in Example 2 [and] resulted in the crystalline Form B of apremilast."  As for the Form C question, the District Court was convinced by evidence that Form C required a toluene solvent to be produced and toluene was not disclosed as a solvent in the preparatory method disclosed in Example 2, chalking up any representations Celgene might have made regarding Form C to be "a mistake."  The District Court, finding that Sandoz's obviousness arguments required a finding that the asserted claims of the '101 patent were not entitled to its earliest priority date, held that Sandoz had not satisfied its burden for invalidating the asserted '101 patent claims.

    For the '541 patent, Sandoz asserted three prior art references:  Papp (Papp et al., Efficacy of apremilast in the treatment of moderate to severe psoriasis: a randomised controlled trial, 380 LANCET 738 (2012)); Schett (Georg Schett et al., Oral apremilast in the treatment of active psoriatic arthritis: results of a multicenter, randomized, double-blind, placebo-controlled study, 64 ARTHRITIS & RHEUMATOLOGY 3156 (2012)); and Pathan (Ejaz Pathan et al., Efficacy and safety of apremilast, an oral phosphodiesterase 4 inhibitor, in ankylosing spondylitis, 72 ANNALS OF RHEUMATIC DISEASES 1475 (2012)).  The Papp reference disclosed clinical trial data using a five-day dosing regimen for apremilast having these details:

    • Day 1: 10 mg first dose; 10 mg second dose
    • Day 2: 10 mg first dose; 10 mg second dose
    • Day 3: 20 mg first dose; 20 mg second dose
    • Day 4: 20 mg first dose; 20 mg second dose
    • Day 5: 30 mg first dose; 30 mg second dose

    The Schett reference also taught the results of a clinical trial, wherein apremilast was administered at 40 mg daily doses (either in single dose or two 20 mg dosages).  Regarding administration for treating psoriasis, this reference taught a "dose-escalation" protocol over the first seven days of treatment.  Finally, the Pathan reference also taught a dose-escalation protocol beginning with 10 mg twice daily, titrating to 20 mg every two days until a dose of 30 mg twice daily was achieved on day 5, for treating ankylosing spondylitis.  The District Court found that one of ordinary skill in the art would have been able to titrate apremilast administration as disclosed in these references and that this would have been a routine aspect of using a drug like apremilast for treating psoriasis.  On this basis the District Court found that the asserted claims of the '541 patent were invalid for obviousness.  Both Sandoz and Amgen appealed.

    The Federal Circuit affirmed all the District Court's findings in an opinion by Judge Lourie joined by Judges Cunningham and Stark.  The bases for Sandoz's appeal were that the District Court erred with regard to the '638 patent by failing to find motivation from the cited art and reasonable expectation of success regarding the (+) enantiomer that is apremilast.  For the '101 patent, Sandoz argued that the District Court erred in finding the '101 patent was entitled to priority to its earliest priority application and its March 20, 2002 filing date.  Sandoz's argument for the '638 patent was that the existence of a racemic mixture provided the motivation to resolve it, that there were methods known in the art to do so (specifically, "chiral chromatography"), that regulatory agencies were exerting "pressure" on pharmaceutical companies to do so and that the fact that apremilast is a thalidomide analogue would have "taught toward" resolving the racemic modification produced by the cited prior art.  Sandoz also argued that the District Court had "inappropriately relied" on testimony from Amgen's expert regarding his difficulties in isolating enantiomers (albeit not apremilast) on the question of whether undue experimentation would have been required to resolve the prior art racemic mixture.  Sandoz also asserted error because the District Court did not hold against Amgen statements in the '638 specification that methods for resolving the racemic mixture to produce apremilast were known in the art.  Further error arose according to Sandoz because the District Court excluded evidence that Celgene had represented to a foreign patent office that the cited '358 patent reference disclosed stereochemically pure apremilast.  Finally, Sandoz challenged the District Court's determinations regarding the secondary considerations of non-obviousness.

    The Federal Circuit rejected these assertions, finding no clear error in the District Court's determinations that Sandoz had not established by clear and convincing evidence that the prior art gave the skilled worker reason or motivation to resolved the racemic mixture produced in Example 12 of the cited '358 patent reference, or that the skilled worker would have had a reasonable expectation of success in so doing even if motivated to do so, or that the (+) enantiomer would have the desired properties it was shown to have in the '101 patent.  The panel's holding in this regard recognized the District Court's reliance on testimony from both parties' experts and its weighing thereof.  The opinion also held that the District Court did not err in not holding Amgen to the representations made by Celgene because as the opinion notes "Sandoz's own expert conceded that the formation of chiral salts was not a viable method for separating the Example 12 enantiomers contrary to the statement in the specification," using this testimony and the Court's recognition of "the unpredictable nature of resolving racemic mixtures and the district court's acceptance of Amgen's expert testimony as credible" to distinguish over PharmaStem Therapeutics, Inc. v. ViaCell, Inc., 491 F.3d 1342,1362 (Fed. Cir. 2007), asserted by Sandoz in support of its argument.  The panel also agreed that the District Court's consideration of the "strong" objective indicia of non-obviousness were not made in error, particularly in view of expert testimony regarding the 20-fold difference in potency between the racemic modification and the purified enantiomer (which, because the (+) and (+) enantiomers were present in a ratio of 50:50 in the racemic mixture was far greater than the "expected" doubling upon separation of the enantiomers).  (The Court noted in this regard that such conclusions were made on a fact-specific basis and that there was "no specific fold-difference that defines [non-obviousness].")  The opinion similarly reviewed and affirmed the District Court's findings concerning the other objective indicia.

    Turning to the '101 patent, the panel found no clear error in the District Court's determinations of whether that patent was properly entitled to the priority date of the earliest claimed priority document.  Sandoz argued that Amgen should not have been permitted to rely on inherent disclosure under circumstances where the priority document did not disclose the X-ray powder diffraction pattern that characterized Form B (apremilast) as claimed in the '101 patent (particularly because Celgene relied upon that pattern to distinguish the '101 claims over the prior art).  Sandoz also cited as error the District Court's disregard for Celgene's "affirmative admissions" regarding preparation of Form C crystalline apremilast using Example 2 in the priority document.'

    The Federal Circuit disagreed and affirmed the District Court's findings that Sandoz failed to establish by clear and convincing evidence that the asserted claims of the '101 patent were invalid for obviousness.  The panel cited the series of thirteen experiments proffered by Amgen showing that Example 2 of the priority document produced Form B apremilast and that Sandoz did not provide any evidence that Example 2 produced any other crystalline forms of the compound.  While recognizing that inherency imposed a strict standard, citing Bettcher Indus., Inc. v. Bunzl USA, Inc., 661 F.3d 629, 639 (Fed. Cir. 2011), the Court stated in its opinion that they did not need to reach the inherency question because Amgen had shown by its evidence, Sandoz's lack of any contrary evidence, and expert testimony that Example 2 of the priority provisional application produced Form B apremilast.  The panel also credited Amgen's distinction regarding Form C and the need for a toluene solvent to produce this crystal form as establishing without clear error that the absence of this reagent in Example 2 of the priority document precluded its presence in the apremilast produced using this method, regardless of any representations predecessor Celgene might have made to a foreign patent office.

    With regard to Amgen's grounds and arguments for appeal, that the District Court erred in finding the asserted claims of the '541 patent obvious based on the prior art dosing schedule, the Federal Circuit affirmed the District Court's affirmance of the finding that the asserted claims of the '541 patent were obvious.  The panel credited the District Court's reliance on expert testimony "establishing that it was well within a skilled artisan's ability to titrate an apremilast dose for a patient presenting with psoriasis and that doing so would have been a routine aspect of treating psoriasis" and that the claimed dosing regimen ("initiating treatment at 10 mg and increasing toward a 30 mg twice-daily target dose in 10 mg increments") would have been obvious over the cited art (Papp and Schett).  The opinion cites Genentech, Inc. v. Sandoz Inc., 55 F.4th 1368, 1376–77 (Fed. Cir. 2022), for the principle, applicable here, that "varying a dose in response to the occurrence of side effects is a well-known, standard medical practice that may well lead to a finding of obviousness" and thus found no clear error in the District Court's determination that the asserted claim of the '541 patent are obvious.

    The Court has addressed the question of whether prior art disclosing racemic mixtures of stereochemically distinct compounds can render obvious claims to purified enantiomers thereof.  See, for example, Aventis Pharma Deutschland GmbH v. Lupin, Ltd.; Sanofi-Synthelabo v. Apotex, Inc.; Mylan Pharmaceuticals Inc. v. Merck Sharp & Dohme Corp.; Trying to Understand What's Not Obvious about What's "Obvious to Try").  This decision is consistent with these earlier examples and illustrates the case-by-case nature of the exercise.

    * The caption is an abbreviation of the defendants, which included in addition to Sandoz Zydus Pharmaceuticals (USA) Inc. (a co-appellant) and Mankind Pharma Ltd., Torrent Pharmaceuticals Ltd., Glenmark Pharmaceuticals Limited, Macleods Pharmaceuticals Ltd., Msn Laboratories Private Ltd., Actavis LLC, Prinston Pharmaceutical Inc., Emcure Pharmaceuticals Ltd., Heritage Pharmaceuticals Inc., Aurobindo Pharma Ltd., Aurobindo Pharma USA, Inc., Annora Pharma Private Limited, Hetero USA, Inc., Cipla Limited, Alkem Laboratories Ltd., Dr. Reddy's Laboratories, Inc., Dr. Reddy's Laboratories, Ltd., Amneal Pharmaceuticals LLC, and Pharmascience  Inc., Defendants

    Amgen Inc. v. Sandoz Inc. (Fed. Cir. 2023)
    Panel: Circuit Judges Lourie, Cunningham, and Stark
    Opinion by Circuit Judge Lourie

  • The Copyright Office Issues Guidance Regarding Works Produced by Generative AI

    By Michael Borella —

    Copyright Office SealOn March 16, the Copyright Office published guidance in the Federal Register relating to works produced at least in part by generative artificial intelligence (AI).  This is the latest in a series of policy decisions and statements that the Office has made to applicants attempting to register such works.

    While AI has been a viable technology for decades, improvements in computer processing and storage capabilities of the last 15 years have enabled the rise of machine learning, a branch of AI in which a computer system can be trained on a large amount of data in order to "learn" underlying patterns within.  In many cases, these patterns are too subtle for a human to notice or require analysis of a massive data set in order to be perceived.  As an example, spam filters often use trained machine learning models to classify email messages as either spam or not spam.

    But generative AI takes machine learning to a whole new level.  In 2022, sophisticated generative AI tools were released to the public for the first time.  Rather than considering an observation of data and classifying it in some fashion, generative AI models can create new observations — particularly images (DALL-E 2, Stable Diffusion, and Midjourney) and text (ChatGPT) — from a user's textual prompt.

    The results can be simultaneously remarkable, startling, and disturbing.  But since the models were trained on existing works found on the Internet, they may exhibit some (or many) similarities with these previous works.  Thus, one issue is whether the output of generative AI is a derivative work or infringes upon the rights of a previous author.

    The purpose of this guidance, however, is to inform the public about the Office's current policy regarding "whether the material [the generative AI models] produce is protected by copyright, whether works consisting of both human-authored and AI-generated material may be registered, and what information should be provided to the Office by applicants seeking to register them."

    At one end of the spectrum, the Office has a long-held position that copyright can only be used to protect the products of human creativity.  Therefore, when presented in 2018 with an application for an image that was described as ''autonomously created by a computer algorithm running on a machine," the Office denied registration to the work as lacking a human author.  Last year, the Office initially registered a graphic novel in which the images were generated using Midjourney and then combined with human-authored text, but recently modified the registration to indicate "that the individual images themselves could not be protected by copyright."

    The guidance adds some color to the Office's decision making process regarding the human authorship question.  Particularly, the Office states:

    In the case of works containing AI-generated material, the Office will consider whether the AI contributions are the result of ''mechanical reproduction'' or instead of an author's ''own original mental conception, to which [the author] gave visible form.''  The answer will depend on the circumstances, particularly how the AI tool operates and how it was used to create the final work.  This is necessarily a case-by-case inquiry.

    As an example, if the human merely provided a prompt to the generative AI model and then the model goes on to produce "complex written, visual, or musical works in response," then the ''traditional elements of authorship are determined and executed by the technology—not the human user."  In that context, the Office notes that "prompts function more like instructions to a commissioned artist" who then makes the artistic decisions.

    But the Office recognizes that there can be a threshold amount of human creativity within a work that also contains the output of a generative AI model such that the work as a whole or parts thereof are registerable.  The Office provides examples such as where "a human may select or arrange AI-generated material in a sufficiently creative way" or that "an artist may modify material originally generated by AI technology to such a degree that the modifications meet the standard for copyright protection."  Nonetheless, in these hybrid cases the copyright protection will only extent to the human-authored aspects.

    With these principles in place, the Office goes on to provide procedural guidance to applicants seeking to register hybrid human / AI works.  Notably, they must "identify the author(s) and provide a brief statement . . . that describes the authorship that was contributed by a human."  For a work that "creatively arranges the human and non-human content," the applicant must "describe human-authored content created by the author and describe AI content generated by artificial intelligence."  Alternatively, the applicant can "provide a general statement that a work contains AI-generated material."  Then, the "Office will contact the applicant when the claim is reviewed and determine how to proceed."

    For existing applications that do not adhere to these guidelines, the Office requires that the applicants "contact the Copyright Office's Public Information Office and report that their application omitted the fact that the work contained AI-generated material."  This will be considered by the examiner when considering the application.

    To correct an existing registration, the applicant must submit a supplementary registration that describes "the original material that the human author contributed" and "disclaim the AI-generated material."  The Office will issue a supplementary registration certificate if there is sufficient human authorship.

    If an applicant fails to update such applications and registrations, the registrations may be cancelled.  Likewise, a court can disregard a registration if it was obtained through deceiving the Office regarding aspects of its authorship.

    Generative AI has proven to be a technologically and socially disruptive paradigm.  Individuals, businesses, and governments will likely be wrestling with its implications for years to come.  In the mean time, it is good to see the Copyright Office being proactive regarding hybrid authorship rather than letting these issues be addressed piecemeal in the courts.  Like many issues in copyright, the authorship inquiry is likely to be highly fact-sensitive and subject to few clear lines of demarcation.

  • Conference & CLE Calendar

    CalendarApril 18, 2023 – "Will SCOTUS Take a Second Arthrex Challenge? Are There Any Limits on USPTO Director Delegation of Duties?" (IPWatchdog and Triangle IP) – 12:00 pm (ET)

    April 18, 2023 – "Due Diligence Trends" (Wolters Kluwer) – 1:00 pm (ET)

    April 18 2023 – "Current Global IP Issues Through the Lens of IPO's Special 301 Comments" (The Intellectual Property Owners Association) – 2:00 pm to 3:00 pm (ET)

  • Webinar on Whether SCOTUS Will Take Second Arthrex Challenge

    IPWatchdogIPWatchdog and Triangle IP will be offering a webinar entitled "Will SCOTUS Take a Second Arthrex Challenge? Are There Any Limits on USPTO Director Delegation of Duties?" on April 18, 2023 at 12:00 pm (ET).  Robert Kry of MoloLamken LLP, who represented Arthrex; Joseph Matal of Haynes and Boone, LLP, who previously "performed the duties and functions" of the Director at the USPTO, and Gene Quinn of IPWatchdog, Inc. will discuss whether the Supreme Court will or should grant certiorari to decide whether the Federal Circuit's decision, in Arthrex II, holding that the Commissioner who was then "performing the functions and duties" of the Director by delegation violates the Appointments Clause, the FVRA, or the Constitution's separation of powers.  The panel will also tackle the fundamental question underpinning the Federal Circuit’s Arthrex II decision, namely the proper interpretation of the Federal Vacancies Reform Act (FVRA), whether all of the USPTO Director's functions and duties are delegable, and whether it was a "red herring" to compare the Supreme Court's Arthrex analysis to the signing of patents by those who were not legally "Acting Director" but were nevertheless vested with the powers of Director.

    There is no registration fee for this webinar.  However, those interested in registering for the webinar, should do so here.

  • Webinar on Due Diligence

    Wolters KluwerWolters Kluwer will be offering a free webinar on "Due Diligence Trends," on April 18, 2023 at 1:00 pm (ET).  Barbara M. Goodstein of Mayer Brown, Shane Hanna of Parsons Behle & Latimer, Dan Lias of CT Corporation, and Bart D. Wall of Bryan Cave Leighton Paisner will delve into key trends and case law that are impacting due diligence in 2023.

    Those interested in registering for the webinar can do so here.

  • IPO Webinar on Current Global IP Issues

    IPO #2The Intellectual Property Owners Association (IPO) will offer a one-hour webinar entitled "Current Global IP Issues Through the Lens of IPO's Special 301 Comments," on April 18 2023 from 2:00 pm to 3:00 pm (ET).  Steve W. Bauer, Retired, Medtronic, Inc.; Dean Harts of 3M Innovative Properties Co.; Sharon Reiche of Pfizer Inc.; and Bill Warren of Eversheds Sutherland, who were involved in the preparation of IPO's comments, will cover issues such as trade secret protection, counterfeiting, compulsory licenses, issues in IP enforcement, genetic resources and an overview of developments at multilateral organizations.

    There is no registration fee for the webinar.  However, those interested in attending the webinar should register here.

  • Arbutus Biopharma Corp. v. ModernaTx, Inc. (Fed. Cir. 2023)

    By Kevin E. Noonan –

    Federal Circuit Seal"This application claims priority to [properly identified earlier-filed application, the disclosure of which is expressly incorporated herein in its entirety" is a phrase commonly found in patents and patent applications as an attempt to bolster disclosure without burdening the specification unnecessarily.  Like many (most) stratagems, use of this phrase can give rise to unexpected (and unwanted) implications, as was noted in a Federal Circuit opinion affirming a decision by the Patent Trial and Appeal Board in inter partes review proceedings instituted at the behest of challenger ModernaTX that invalidated all claims of the challenged patent owned by Arbutus in Arbutus Biopharma Corp. v. ModernaTx, Inc.

    The subject matter of the challenged patent, No. 9,404,127, was stable nucleic acid lipid particles ("SNALP") that occur in two morphologies:2023-04-13 Image
    wherein the structure illustrated on the left is "lamellar" and the structure illustrated on the right is "non-lamellar"; the '127 patent claims are directed to the non-lamellar form.  This "morphology limitation" is dependent upon how the SNALP is made, which is in turn dependent upon the lipids used in making the SNALP and the process used.  With regard to the process SNALPS can be made by a Stepwise Dilution Method (SDM) or a Direct Dilution Method (DDM) and the formulations can have five different ratios for the composite lipids, with 1:62 and 1:57 being those relevant to the claims at issue and referring to a conjugated lipid and a cationic lipid, respectively.  Independent claim 1 was reproduced in the opinion as being representative:

    1.  A composition comprising:
        a plurality of nucleic acid-lipid particles, wherein each particle in the plurality of particles comprises:
            (a) a nucleic acid;
            (b) a cationic lipid;
            (c) a non-cationic lipid; and
            (d) a conjugated lipid that inhibits aggregation of particles, wherein at least about 95% of the     particles in the plurality of particles have a non-lamellar morphology (with this limitation being     the morphology limitation).

    The '127 patent issued from an application filed on March 9, 2015 that claimed priority to a provisional application filed on June 30, 2010 (making June 30, 2009 the critical date for novelty-destroying prior art).  The '127 patent incorporated by reference published U.S. Patent Application Publication Nos. 2007/0042031 ("the '031 application, for disclosure of DDM) and 2004/0142025 (for SDM and apparatuses therefor), these publications being indisputably in the prior art at the '127 patent's earliest claimed priority date.

    The PTAB held all claims of the challenged '127 patent to be invalid as being anticipated by U.S. Patent No. 8,058,069 ("the '069 patent"), which was filed on April 15, 2009 and claimed priority to a provisional application filed one year earlier (the Federal Circuit noting that the '127 patent did not claim priority to the '069 patent, even though these patents are commonly owned by Arbutus).  The basis for this decision was that the Board found that both patents:

    [A]re directed to the same purpose (providing SNALP, methods of making and delivering SNALP); disclose at least the 1:57 and 1:62 formulations; explain that SNALP can be formed by any method in the art including direct dilution, and direct the reader to rely on the '031 publication for details on using DDM.

    The '069 patent incorporated by reference several other patents that the Board held disclosed "several of the same disclosures and experiments" set forth in the '127 patent.

    The Board's decision focused on the claim 1(d) element (the morphology limitation) and whether it was inherently disclosed in the '069 patent.  The basis for Moderna's assertion of inherent anticipation was that the non-lamellar structure arose as a consequence of the composition of the SNALP and the method (DDM) used to produce it which the Board found convincing (despite expert testimony based on experimental evidence to the contrary), and Arbutus's concession that the specification of a continuation of the '069 patent disclosed the morphology limitation.  Accordingly, the Board held all claims of the '127 patent to be invalid for anticipation.  This appeal followed.

    The Federal Circuit affirmed in an opinion by Judge Reyna, joined by Judges Schall and Chen.  With regard to the question of incorporation by reference, the panel cited its precedent that "[w]hen a reference or material from various documents is incorporated, they are 'effectively part of the host document as if [they] were explicitly contained therein,'" Advanced Display Sys., Inc. v. Kent State Univ., 212 F.3d 1272, 1282 (Fed. Cir. 2000). The panel, like the Board, rejected Arbutus's arguments that the DDM process comprised "many parameters that could be varied" based on Arbutus's expert's concession that the '435 patent (a continuation of the '069 patent) also disclosed the morphology limitation.  In the circumstances before the Court, "the disclosure of the '069 patent and its incorporated references sufficiently demonstrate to a person skilled in the art how to make and use the claimed compositions, processed by DDM, that results in the Morphology Limitation."  The evidence before the Board satisfied the legal requirement for inherent anticipation that production of the claimed SNALPs was a "natural result flowing from" the disclosure in the prior art under SmithKline Beecham Corp. v. Apotex Corp., 403 F.3d 1331, 1343–44 (Fed. Cir. 2005).  Here, the panel asserts that "the '127 and '069 patents disclose the same formulations with 'almost identical wording,'" ("[t]he specificity of the disclosure in the '069 patent is the same as in the '127 patent") including the 1:57 and 1:62 formulation ratios (and that the other ratios disclosed and claimed in the '127 specification could be substituted without impacting the morphology limitation according to Arbutus's expert.  Both the '127 and '069 patents reference the '031 application for disclosure of the DDM method for producing SNALPs having the claimed morphology limitation with the challenged '127 patent incorporating by reference the '031 disclosure, which supported the Board's conclusion that the '127 patent discloses this method the same way it was disclosed in the prior art '031 application.  The opinion concludes that because the panel found no error in the factual question of whether the prior art taught "the same formulations and the same DDM" disclosed and claimed in the '127 patent the challenged claims were anticipated by the art and invalid.

    With regard to dependent claims directed to forms of the claimed SNALPs comprising mRNA (claim 3) or "fully encapsulated" nucleic acids (claim 8) were disclosed as formulations in the prior art.  The Court found SNALPs having specific three-dimensional structures (claim 9) to recite inherent properties of the SNALPs produced according to the cited art.  And regarding claims to percent ranges for the lipid components of the claimed SNALPs (claims 10-12), the Court relied on its precedent that "[w]hen a patent claims a chemical composition in terms of ranges and a single prior art reference discloses a composition that falls within each of the ranges, the range is anticipated, citing Titanium Metals Corp. of Am. v. Banner, 778 F.2d 775, 782 (Fed. Cir. 1985).  This disclosure arose in the cited prior art by incorporation by reference of U.S. Patent Application Publication No. 2006/0083780 (the "'780 publication"), U.S. Patent Application Publication No. 2004/0142025 (the "'025 publication"), and U.S. Patent No. 5,885,613 (the "'613 patent").

    While not dispositive, this decision is relevant to the on-going disputes between owners of lipid nanoparticle IP and vaccine makers over COVID 19 and other mRNA-based vaccines against other diseases (see "Pfizer and BioNTech Sued for Patent Infringement over mRNA Vaccine").

    Arbutus Biopharma Corp. v. ModernaTx, Inc. (Fed. Cir. 2023)
    Panel: Circuit Judges Reyna, Schall, and Chen
    Opinion by Circuit Judge Reyna

  • Will Artificial Intelligence Force Us to be Less Dumb about How We Evaluate Humans?

    By Michael Borella —

    Years ago, I was a proud parent when my children were invited to participate in an honors math program at their grade school.  But this initial delight turned to confusion, and eventually frustration.

    As just one example of why I was less than pleased with our school's pedagogy, one very highly emphasized part of the curriculum required that the kids memorize as many digits of pi as they could, with the minimum being 25.  Sure, they also learned how pi defined the ratio of a circle's circumference to its diameter and how to use it in simple algebra, but this memorization task was the focus of the unit, with the child who memorized the most digits (130 one year) winning special accolades.

    To me, this assignment missed the point.  Pi is a critical value in many aspects of science and engineering, and can be taught directly or indirectly in a number of compelling and fun ways involving wheels, pizza, spirographs, and so on.  And its importance in aviation and communications can at least be mentioned.

    But the focus was on committing those 25-plus digits to memory and being able to recite them on demand.  When I pointed out to the teachers that maybe — just maybe — this was not the best way to prepare children to have an appreciation for STEM fields, they looked at me like I was from another planet.  The curriculum was designed around what was easy to test (can the kid produce the 25 digits when asked?) rather than the harder-to-evaluate skills (does the kid know how and when to use pi to solve problems?) that are actually important when using math in the real world.[1] 

    Thus, when the news broke that OpenAI's GPT-4 large language model passed the uniform bar exam at the 90th percentile, I was less than impressed.  In fact, this outcome is completely unremarkable given that it was trained on billions of units of human text.

    The bar exam is a memorization exam.  Aspiring lawyers typically spend 10-12 weeks taking a bar exam review course, which involves committing massive amounts of legal rules and principles to memory, as well as learning how to write essays in a formulaic fashion (IRAC).  Then you sit for two days of testing in which you regurgitate as much as you can.  If you manage to score highly enough, you pass and become a licensed attorney.

    During the summer that I spent preparing, I remember at one point mentioning in frustration to my study partner that what the bar exam is actually testing is how much pain one is willing to accept to be a lawyer, and that rapping us across the knuckles a few times with a ruler would probably have the same effect.  Indeed, I know of individuals who graduated law school in the top ten percent of their class (in terms of GPA), failed the exam on their first try, later passed, and went on to be excellent attorneys.  Clearly, these folks were bright, but when speaking to them they attributed their failure (which was quite the source of shame) on not studying hard enough during bar review.  Let that sink in — top law students can fail to be licensed because they do not learn the mechanical proclivities of one specific exam.

    A recent paper from Professor Daniel Katz evaluates GPT-4's bar exam performance and states that "These findings document not just the rapid and remarkable advance of large language model performance generally, but also the potential for such models to support the delivery of legal services in society."[2]  The key word in this sentence is "potential" but even so this statement is misleading.

    GPT-4 scoring well on the bar exam is not because AI is achieving human levels of intelligence.  It is because the bar exam tests a human's ability to perform like a robot.  Missing from the bar exam are tests of executive function (e.g., staying organized, keeping to deadlines), soft skills (e.g., client interaction and counseling, interpersonal competencies), and law firm operation (e.g., finance, marketing, managing groups, how to be a good employer), all of which are more relevant to a lawyer's success than their ability to stuff facts into their brains.

    Indeed, it is now widely accepted that GPA is much more predictive of a student's ultimate success than standardized test scores.  This is because maintaining a high GPA requires more than the raw cognitive ability to do well on memorization-based exams — the aforementioned executive functioning and soft skills play a significant role.  Intellectual ability is important, but so is emotional intelligence.

    Turning to patent law, there might be one multiple choice question out of 200 addressing intellectual property on the typical year's bar exam.  So for us patent attorneys, the bar exam is measuring our ability to regurgitate law that we are unlikely to ever apply in practice.  To that point, the USPTO requires that we pass a separate patent bar exam.  Admittedly, it is also memorization-based, but at least it is open book.

    So, to the extent that Professor Katz is implying that GPT-4 or any other of the current generation of large language models can perform significant legal tasks, I have to disagree.  Large language models are tools that lawyers can employ, not unlike search engines or Wikipedia.  They may be able to carry out certain first-level research functions in place of a junior associate.  But when it comes to crafting creative legal strategies that guide clients through complex transactions, they are still far from the mark.

    Nonetheless, the strong performance of GPT-4 on memorization-based exams provides us with a golden opportunity to re-evaluate how we teach both children and law students.  If the goal is to turn out humans with skills that can be easily replaced by automation, then maintaining the status quo will get us there.  But we would be much better off by recognizing and embracing large language models, while remaining cognizant of their strengths and weaknesses.  Integrating these tools into a broad-spectrum education system with a flexible curriculum is much more likely to produce graduates who can adapt to the changing needs of the legal profession, or any other field for that matter.

    The modern education system is still based too much on a paradigm established in the 1800s, one in which an instructor lectures and the students passively receive their lessons.  Given that large language models can outperform most humans in these scenarios, we need to seriously consider changing the system to meet the demands of 21st century life.

    And for anyone who absolutely needs to know the first 25 digits of pi, don't worry because GPT has you covered:  "The first 25 digits of pi (π) are:  3.14159265358979323846264.  Note that pi is an irrational number, meaning that its decimal representation goes on infinitely without repeating."  Or, it almost has you covered, as the 25th digit is missing from its output.

    [1] To get a sense of how prevalent issues like this are in education, 60 years ago Nobel laureate physicist Richard Feynman was asked to help the state of California select math textbooks for its schools.  He wrote about the process, which is both humorous and disheartening.  From what I have seen, today’s textbooks are better than they were back then but still leave plenty of room for improvement . . . such as justifying why one needs a textbook, period.

    [2] Katz, Daniel Martin and Bommarito, Michael James and Gao, Shang and Arredondo, Pablo, GPT-4 Passes the Bar Exam (March 15, 2023).  Available at SSRN:  https://ssrn.com/abstract=4389233 or http://dx.doi.org/10.2139/ssrn.4389233.