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  • CLE on Patent Eligibility, Prior Art and Obviousness

    PLI #1Practising Law Institute (PLI) will be offering a seminar entitled: "Patent Eligibility, Prior Art and Obviousness 2015: Current Trends in Sections 101, 102 and 103" on June 15, 2015 in San Francisco, CA.  The seminar will also be webcast.  The seminar includes not only the important touchstones of prior art and obviousness, but also patent eligibility post-Alice.  PLI faculty will provide predictions about what will happen during a patent's enforcement period now that the U.S. Supreme Court has taken an interest in the patent system, and give practical tips as to how best to find clarity where there often isn't any.  The seminar will address the following topics:

    • The moving target of 101: A closer look at the Supreme Court and PTO Guidelines;
    • Dates and timelines of 102: Is there a "grace period"?
    • What does "effective filing date" mean from a global perspective?
    • A review of the universe of KSR and 103;
    • Impact of proper and improper benefit claims on the prior art date of a reference and the effective filing date of the application being examined; and
    • Applying 101 and 103 guidance after Myriad, Mayo, Alice and KSR retrospectively.

    PLI faculty will offer presentations on the following topics:

    • Overview of the Program 101, 102, and 103 from now to the advice horizon
    • Section 102: Inside and outside the PTO — the AIA and the future
    •  KSR and 103: Tools you can use?
    • 35 USC 103 and the CAFC
    • The Concept of Old 102(e) Recast as New 102 (a)(2) as Implemented by New 102(d): Effects of Priority Under 119, 120, 121, 365

    The registration fee for the seminar or webcast is $1,695.  Those interested in registering, can do so here.

  • OIP Technologies, Inc. v. Amazon.com, Inc. (Fed. Cir. 2015)

    By Michael Borella —

    AmazonIn its first substantive application of Alice v. CLS Bank in 2015, the Federal Circuit has once again shot down claims for not meeting the patent-eligibility requirements of 35 U.S.C. § 101.

    In 2012, OIP sued Amazon in the Northern District of California, alleging infringement of U.S. Patent No. 7,970,713.  The District Court granted Amazon's motion for judgment on the pleadings, finding that the '713 patent is not directed to patent-eligible subject matter, as the claims "merely use a general-purpose computer to implement the abstract idea of price optimization."  Judges Taranto, Mayer, and Hughes heard the appeal.

    Claim 1 of the '713 patent recites:

    A method of pricing a product for sale, the method comprising:
        testing each price of a plurality of prices by sending a first set of electronic messages over a network to devices;
        wherein said electronic messages include offers of said product;
        wherein said offers are to be presented to potential customers of said product to allow said potential customers to purchase said product for the prices included in said offers;
        wherein the devices are programmed to communicate offer terms, including the prices contained in the messages received by the devices;
        wherein the devices are programmed to receive offers for the product based on the offer terms;
        wherein the devices are not configured to fulfill orders by providing the product;
        wherein each price of said plurality of prices is used in the offer associated with at least one electronic message in said first set of electronic messages;
        gathering, within a machine-readable medium, statistics generated during said testing about how the potential customers responded to the offers, wherein the statistics include number of sales of the product made at each of the plurality of prices;
        using a computerized system to read said statistics from said machine-readable medium and to automatically determine, based on said statistics, an estimated outcome of using each of the plurality of prices for the product;
        selecting a price at which to sell said product based on the estimated outcome determined by said computerized system; and
        sending a second set of electronic messages over the network, wherein the second set of electronic messages include offers, to be presented to potential customers, of said product at said selected price.

    In short, the '713 patent claims a computer-implemented method for testing the uptake of various different prices for a product, determining which of these prices resulted in a desirable outcome (e.g., highest number of sales or highest profitability), and then using this price for future sales of the product.

    According to the '713 patent, "traditionally merchandisers manually determine prices based on their qualitative knowledge of the items, pricing experience, and other business policies . . . [i]n setting the price of a particular good, the merchandiser estimates the shape of a demand curve for a particular product based on, for example, the good itself, the brand strength, market conditions, seasons, and past sales."  But, "the merchandiser is slow to react to changing market conditions, resulting in an imperfect pricing model where the merchandiser often is not charging an optimal price that maximizes profit."  A purported advantage of the invention is that it "helps vendors automatically reach better pricing decisions through automatic estimation and measurement of actual demand to select prices."

    After noting that § 101 issues are matters of law reviewed de novo, the Federal Circuit set forth the two-prong patent-eligibility test of Alice.  The first prong is to determine whether the claims are directed to a patent-ineligible law of nature, natural phenomenon, or abstract idea.  If so, the second prong is to determine whether any additional claim elements transform the claim into a patent-eligible application that amounts to significantly more than the ineligible concept itself.

    The Court noted that "[c]laim 1 broadly recites a method of pricing a product for sale," and that "[t]his concept of offer based pricing is similar to other fundamental economic concepts found to be abstract ideas by the Supreme Court and this court."  Further, "that the claims do not preempt all price optimization or may be limited to price optimization in the e-commerce setting do not make them any less abstract."

    Turning to the second prong, the Court found that, beyond this abstract idea, "the claims merely recite well-understood, routine conventional activities, either by requiring conventional computer activities or routine data-gathering steps."  Additionally, the Court indicated that "the claims are exceptionally broad and the computer implementation limitations do little to limit their scope" and that "the specification makes clear that this programming and the related computer hardware refers to any sequence of instructions designed for execution on a computer system."  Also swaying the Court's opinion was its belief that "relying on a computer to perform routine tasks more quickly or more accurately is insufficient to render a claim patent eligible."

    On this basis, the Court concluded that the claims did not meet the requirements of § 101, and affirmed the District Court.

    Judge Mayer wrote separately to reiterate his previously-expressed view (see I/P Engine, Inc. v. AOL Inc. (Aug 2014) and Ultramercial Inc. v. Hulu LLC (Nov. 2014)) that patent-eligibility should be addressed at the outset of a case, for example, in the pleadings as was done by Amazon.  Particularly, he contended that doing so "not only conserves scarce judicial resources and spares litigants the staggering costs associated with discovery and protracted claim construction litigation, it also works to stem the tide of vexatious suits brought by the owners of vague and overbroad business method patents."  But then he went on to state that the Supreme Court has instructed that § 101 is to be resolved at the first opportunity.

    As we have noted previously, Judge Mayer is taking liberties with his interpretation of the Supreme Court's position.  No Supreme Court cases (or Federal Circuit cases for that matter) actually go as far as stating that § 101 determinations must be made early in litigation.  These cases may suggest the § 101 inquiry should take place before §§ 102 and 103 examination, but they do not state that this is a requirement.

    And for good reason.  Unfortunately, the Alice test is often decided on vague notions of whether a claim is "too abstract," "too broad," or whether it resembles those reviewed in Alice and Bilski v. Kappos.  Use of this "walks like a duck" criteria allows courts, as well as the Patent and Trademark Office, to strip patentees of their property rights without discovery, claim construction, or determination of ordinary skill in the art.  No doubt, Judge Mayer's proposal would reduce the size of courts' dockets, and probably result in some "bad" patents being invalidated.  All patents challenged under § 101, however, would be at risk of being thrown out with the bathwater.

    OIP Technologies, Inc. v. Amazon.com, Inc. (Fed. Cir. 2015)
    Panel: Circuit Judges Taranto, Mayer, and Hughes
    Opinion by Circuit Judge Hughes; concurring opinion by Circuit Judge Mayer

  • News from Abroad: Pravastatin Sodium Case, Japan Product-by-Process Claiming Practice: Supreme Court Overrules the Grand Panel of the IP High Court

    By Dr. Shoichi Okuyama* —

    Japan FlagProduct-by-process claim drafting and interpretation practice were greatly modified by the Pravastatin Sodium Case decisions (Japan Supreme Court, June 5, 2015, Second Petty Bench, case Nos. 2012(ju)1204 and 2012(ju)2658).  Japan's highest court reversed the Grand Panel of the IP High Court; two points were emphasized in the opinion of the Court:

    Products made by a Different Process Infringe the Claim:  "[E]ven if a patent claim concerning a product invention recites the manufacturing process of a product, the technical scope of the patented invention should be determined to cover products that have the same structure and characteristics, etc., as those of the product made in accordance with the manufacturing process."

    Product-by-Process Claims When Only Way to Define Product:  "[W]hen patent claims concerning a product invention recite the manufacturing process of a product, the claims would satisfy the requirement [that] "the invention be clear" according to Article 36(6)(ii), Patent Act, only if circumstances exist under which it is impossible or utterly impractical to directly identify the structure or characteristics of the product at the time of filing."

    An analysis follows, with more expansive extracts from the Supreme Court opinion at the end of this paper.

    The Supreme Court Lipase Decision (1991):  The Supreme Court in this decision recognized the importance of the public notice function of patent claims.  Citing the Lipase Decision, the Court in the Pravastatin Sodium Case reiterated the public notice function of patent claims.  In the earlier Lipase Decision the Supreme Court rejected the idea of reading a limitation from the specification into pending claims.  The Tokyo High Court (now IP High Court) read "lipase" in the claim as the species "Ra lipase" because all examples in the specification in the context of the patent examination proceedings were for Ra lipase.  The Lipase Decision was an appeal from a JPO decision to reject the application.

    The Supreme Court stated that:

    When the patentability requirements according to Article 29(1) and (2), Patent Act are examined; that is, the novelty and inventive step of an invention found in a patent application, the gist of the invention in the application has to be determined in order for the invention to be compared with prior art defined in Article 29(1).  Unless special circumstances exist, this determination of the gist has to be made based on the recitations in the claims.  Only if special circumstances exist such as when the technical meaning of a recitation in the claim cannot be understood without ambiguities, or when it is apparently clear that such recitation is an error with reference to the detailed descriptions of the invention in the specification, it is permitted to refer to the detailed description of the invention in the specification.

    The Supreme Court has thus apparently Justice Yamamoto's sharply worded Concurrence once again rejected the idea of differentiating the scope of a patent claim based on circumstances or conditions that exist outside the claim.

    Justice Yamamoto's Sharply Worded Concurrence:  Justice Yamamoto, who started his career as a bureaucrat at the Ministry of International Trade and Industry (now the Ministry of Economy, Trade and Industry), concurred with the Judgement but criticized the majority opinion.

    Supreme Court Reference to American Court decisions:  In the supporting opinion, Justice Chiba discussed the en banc decision of the Federal Circuit in Abbott Labs. v. Sandoz, Inc. (2009), and the Nautilus United States Supreme Court decision.

    Implications for Product-by-Process Claiming:  Under these new Supreme Court decisions, the Japan Patent Office now has to examine patent applications containing product-by-process claims to determine whether or not any circumstances exist under which it was impossible or utterly impractical to directly identify the structure or characteristics of the product at the time of filing.  The burden rests on the applicant to show to show such circumstances existed as of the filing date.  It is generally not easy to show that something is impossible to accomplish while it may be easier to show the contrary.  Also, the applicant may have to make sure that the structures or characteristics of, say, antibiotics, microorganisms or modified cells are described in detail in the patent application, although claims identifying such structures or characteristics may be more difficult to understand.

    Questioning the Validity of Existing Patents:  The validity of existing patents that have product-by-process limitations in the claims may have to be questioned.

    * * *

    Pravastatin Sodium Case
    Case No. 2012 (ju) 1204
    Patent infringement case demanding injunction
    June 5, 2015
    Ruling of the Second Petty Bench

    Excerpts from the opinion**

    Judgement

    The original decision is reversed.

    The case is remanded to the Intellectual Property High Court.

    Reason

    Concerning the first, second, fourth, and fifth points raised in the Petition for Acceptance of Final Appeal by appeal attorney Kiyoshi Kamiya.

    1        In the present case, the appellant, who has a patent including a so-called product-by-process claim which recites the manufacturing process of a product with the patent being granted on a product invention, asked for an injunction on the manufacture and sale of pharmaceutical products the appellee produces and the disposal of such products, because the appellee's pharmaceutical products allegedly infringe on the appellant's patent.  The appellee asserts, for example, that such pharmaceutical products does not fall under the technical scope of the patented invention of the appellant.  An issue in dispute is how the technical scope of a patented invention should be determined when the manufacturing process is recited in a patent claim directed to a product invention.

    2        Summary of the original court decision and determined facts are as follows.

    (1) The present patent
    The appellant has a patent on an invention entitled "Pravastatin sodium substantially free of pravastatin lactone and epi-pravastatin, and compositions containing same," (patent No. 3,737,801, and the number of claims is nine. Hereinafter, it is called "the subject patent.")

    (2) The present invention
    Claim 1 of the claims of the patent (hereinafter referred to as "the subject claim.") is as follows (hereinafter referred to as "the present invention").
    "Pravastatin in which the mixing amount of the pravastatin lactone is less than 0.5 wt%, pravastatin sodium contamination of epiprava is less than 0.2% by weight, prepared by a process comprising the following steps:
        a) forming a concentrated organic solution of pravastatin;
        b) precipitating pravastatin as an ammonium salt thereof;
        c) purifying the ammonium salt by recrystallization;
        d) transposing the ammonium salt to the pravastatin sodium; and
        e) isolating pravastatin sodium."

    (3) The appellee's product

    A. The appellee manufactures and sells pravastatin Na salt tablets 10mg of the drug "KH" (formerly known as pravastatin Na salt tablets 10mg "Merck", hereinafter referred to as "the appellee product".).

    B. The appellee's product contains pravastatin sodium that has less than 0.5 wt% of mixed pravastatin lactone and less than 0.2 wt% of mixed epiprava.  Its method of manufacture, at least, does not involve "a) forming a concentrated organic solution of pravastatin" recited in the subject claim.

    3        The original decision made determinations as follows and dismissed the demand of the appellant.

    (1) The technical scope of a patented invention, when the manufacturing process of a product is recited in patent claims directed a product invention, the technical scope of such invention should be limited to products manufactured according to the manufacturing process described in the claim, unless there exist circumstances in which it is impossible or difficult at the time of filing to directly identify the product by its structure or characteristics.

    (2) Since no such circumstances as in (1) above exist for the present invention, the technical scope of the present invention should be limited to those produced by the production process.  The process for making the appellee's product does not involve at least "a) forming a concentrated organic solution of pravastatin" recited in the subject claim, the appellee's products do not fall within the technical scope of the present invention.

    4        However, we cannot accept the criteria indicated in 3(1) above discussed in the original decision, and we cannot accept the determination made on the basis of such criteria discussed in 3(2) above.  The reasons for this are as follows:

    (1) The claims attached to the application has the function of defining the technical scope of the patented invention based on what is described in the claims (Article 70(1), Patent Act), and also determining the gist of the invention in the patent application for which examination of patentability requirements such as those prescribed in Article 29 of the same Act is carried out based on what is in the claims (Supreme Court decision of March 8, 1991, Case No. 1987(gyotsu), the ruling of the Second Petty Bench, published in Minshu, Vol. 45, No. 3, page 123).  While patents are granted on product inventions, method inventions, and inventions of processes for producing products, when a patent is granted on a product invention, the effect of the patent covers products that have the same structure and characteristics, etc. as those of the patented product without any regards to the manufacturing process.

    Therefore, even if a patent claim concerning a product invention recites the manufacturing process of a product, the technical scope of the patented invention should be determined to cover products that have the same structure and characteristics, etc., as those of the product made in accordance with the manufacturing process.

    (2)  By the way, according to Article 36(6)(ii), Patent Act, recitations in the claims have to satisfy the requirement that "the invention be clear".  The patent system is to provide protection over inventions for patentees by granting patents that are monopolistic rights to those who disclosed inventions, and encourage the utilization of inventions by letting third parties know of patented inventions, for the purpose of encouraging inventions, and thereby contributing to the development of industry (Article 1, Patent Act).  We understand that the requirement of clarity of the invention in the claims according to Article 36(6)(ii) is provided for this purpose.  In view of this, in every case where the manufacturing process of a product is described in a patented claim directed to a product invention, if the effect of the patent is determined in such a manner that the technical scope of a patented invention is determined to cover products that have the same structure and characteristics, etc. as those of the product made in accordance with the manufacturing process, it is problematic in that third party interests may possibly be unjustifiably prejudiced.  In other words, if the manufacturing process is recited in a patented claim directed to a product invention, it is generally unclear what structures or characteristics of the product are represented by the manufacturing process, or it is unclear whether the technical scope of the claim directed to a product invention is limited to products manufactured by the manufacturing process.  The reader of such recitation in the claims cannot clearly understand the content of the invention, and it makes unpredictable what scope of monopoly the proprietor has.  This is not entirely appropriate.

    On the other hand, in patent claims directed to a patent for a product invention, such product is ordinarily identified by clearly reciting its structure and characteristics in a direct manner.  However, depending on the nature, property or the like of the product, it may be technically impossible to analyze its structure or characteristics at the time of filing, or it may require an outrageously large economic expenditure or time to carry out work necessary to identify.  In view of the nature of patent applications which requires speed, etc., there may be cases where it is not practical to require applicants such identification.  Therefore, it should be made possible to recite a manufacturing process in a claim directed to a product invention.  If the above-mentioned circumstances exist, third party interests would not be unjustifiably harmed even if the technical scope of the patented invention is determined to be products that have the same structure and characteristics, etc. as those of the product made by such manufacturing process.

    As we have discussed above, when patent claims concerning a product invention recite the manufacturing process of a product, the claims would satisfy the requirement of "the invention be clear" according to Article 36(6)(ii), Patent Act, only if circumstances exist under which it is impossible or utterly impractical to directly identify the structure or characteristics of the product at the time of filing.

    5        Differing from the above, the judgement in the original decision, which says that when the manufacturing process of a product is recited in the claims, while generally allowing such recitation in the claims, the technical scope of the patented invention should be determined to be limited, as a rule, to products manufactured according to the manufacturing process described in the claim, contains a clear violation of law which affects the conclusion of the decision.  The drift of the arguments is reasoned, and the original decision has to be reversed.  Then, the case is remanded to the original court, so that in accordance with what is discussed in this decision, proceedings should be completed concerning whether the recitation in the claims satisfies the requirement of "the invention be clear" and allowable when the circumstances discussed in section 4(2) above exist, and the technical scope of the invention should be determined.

    Thus, in the opinion of the justices unanimously, it is ruled as in the Judgment.  In addition, Justice Katsumi Chiba has a supporting opinion[1], and Justice Tsuneyuki Yamamoto has an opinion[2].

     — The rest of the decision has not been translated —

     

    * Patent Attorney with Okuyama & Sasajima
     
    ** This is a tentative English Translation of the Majority Opinion of the Supreme Court of Japan in Case No. 2012(ju)1204 as published on the web site of the Supreme Court (Supporting Opinion by Justice Katsumi Chiba and Opinion by Justice Tsuneyuki Yamamoto are not included. Underlining is shown as it appears in the decision.)

    [1] Justice Chiba explained the majority opinion (about 5 pages) in greater detail in a lengthy discussion (about 8 pages).

    [2] Concurring in judgement

  • A Sea Change for IPRs? — Part II

    By Grantland Drutchas —

    House of Representatives SealYesterday, we reported on the inter partes review (IPR)-specific provisions of the Managers Amendment to the PATENT ACT bil, which was passed last week by the Senate Judiciary Committee (see also "Senate Judiciary Committee Passes PATENT Act").

    On June 9th, in the House of Representatives, Rep. Bob Goodlatte submitted an "Amendment in the Nature of a Substitute to H.R. 9" for his INNOVATION ACT bill.  This bill does not comport fully with the Senate bill, but the amendment does include tweaks to the Litigation Reform proposals in his prior bill (see "Rep. Goodlatte Introduces His Patent Reform Bill (Again)" and "Rep. Goodlatte Introduces His Patent Reform Bill (Again) — Part II"), and a couple of the IPR/PGR-related provisions of the PATENT ACT Manager's Amendment addressed in our report yesterday.  It also contains a couple of new IPR/PGR provisions, relating to consideration of due process rights in implementing IPR/PGR regulations and requiring that a petitioner certify that it has engaged in hedging or demanded payment from the patent owner.

    Note that the Goodlatte Innovation Act bill introduced on February 5, 2015 already included one of the Standards and Burden of Proof provisions of the Senate bill — requiring the Phillips' ordinary and customary claim construction standard to be applied as opposed to the broadest reasonable interpretation.  It also required that the PTAB consider any prior claim construction by a Court.

    Thus, the new IPR/PGR provisions introduced by amendment in the Goodlatte bill are as follows:

    EVIDENCE:
    Allows the Preliminary Response to Petition for an IPR or PGR to include affidavits or declarations of supporting evidence and opinions.  Also allows the Commissioner to accept a reply by the Petitioner to any new issues raised in the response [similar to the Senate bill].

    CONSIDERATION OF DUE PROCESS:
    Requires the Director in implementing any regulations regarding IPRs and PGRs to consider the effect of those regulations on due process of the patent owner [new provision].

    PEITIONER CERTIFICATION:
    Precludes review unless the petitioner certifies: (1) that it does not own a financial instrument designed to hedge or offset any decrease in market or equity value of the patent owner or an affiliate, and (2) that it has not demanded payment from the patent owner in exchange for foregoing filing an IPR/PGR (unless the petitioner or real party in interest has been sued or charged with infringement under patent)  [new provision].

    Patent Docs will provide more information on amendments to the Innovation Act in a subsequent post.

  • A Sea Change for IPRs?

    Late-Breaking Section 11 Regarding IPRs Part of the PATENT Act Approved by Senate Judiciary Committee

    By Grantland Drutchas —

    Washington - Capitol #3As reported here last week, the Senate Judiciary Committee passed the PATENT Act bill, with a Managers Amendment that includes several IPR-specific provisions.

    With this Amendment, the PATENT Act now has two major components:  changes to IPRs to help counterbalance the Litigation Reform efforts.  It seems to signal a compromise brewing among moderate forces in the various camps — the Pharma sector might accept Litigation Reform if there are fixes to the IPR regime.  And the Tech sector might accept changes to the IPR regime if there are further improvements to Litigation Reform.

    The primary IPR provisions with the Manager's Amendment to the PATENT Act are as follows:

    EVIDENCE:
    Concern:  The petitioner could put in declarations, affidavits, etc., but the patent holder is limited to attorney arguments in response to the petition.  This is an issue of fairness, particularly where witness credibility or fact issues arise.

    Managers' Amendment (pp. 42-43):  The patent owner can put in affidavits or declarations of supporting evidence and opinions in its preliminary response.  The petitioner may seek leave to file a reply to respond to new issues raised in the preliminary response.

    REVIEW BASED ON SAME EVIDENCE AS CONSIDERED BY COURTS:
    Concern:  In some cases where the PTAB has taken on review after the district court, it has addressed the same evidence as the district court.  The PTAB has actually cited the different standards of review as a basis for granting a petition.  As a result, there have been requests to amend so that if courts considered the same or substantially the same evidence, the PTAB must give deference to district court decision.

    Managers' Amendment (Section 11, pp. 43-44):  The PTAB should consider the interests of justice — whether the same or substantially the same evidence has been involved in a court proceeding.

    STANDARDS AND BURDEN OF PROOF:
    Concern:  Differing standards in PTAB trials from district court litigation have made the PTAB look like a death squad.  Many, especially in the pharmaceutical and biotech sectors, have requested that the PTAB apply uniform standards as the district courts — 3 prongs: 
1) Phillips' ordinary and customary claim construction standard to be applied as opposed to broadest reasonable interpretation, 2) clear and convincing evidence invalidity standard to be applied, and 
3) presumption of validity to be applied throughout the course of proceedings.

    Managers' Amendment (Section 11, pp. 48, 50):  District Court Philips standard and presumption of validity (1 and 3 only).  Clear and convincing evidence not in amendment and burden is still the same (preponderance).  It is not clear how a presumption would be applied if the standard is not clear and convincing evidence.

    ABILITY TO AMEND CLAIMS:
    Concern:  Lack of a real opportunity to amend — combined with broadest reasonable interpretation, this makes PTAB trials particularly problematic.  Amendment has only been permitted in a handful of IPRs to date.

    Managers' Amendment (Section 11, pp. 55-56):  Regulations to be promulgated that allow substitute claims under certain conditions.  Also, currently permits challenger to argue "unpatentability" — not clear whether challenger can raise 112 arguments against amended claim.

    INSTITUTION:
    Concern:  Merits panel having the same composition decides on the institution of the petition and then resolves final decision –- viewed as stacked against patent holder because the same group that made the initial decision to institute may be pre-disposed regarding patentability in reaching a final decision.

    Managers' Amendment (Section 11, p. 57):  No more than one decision maker can overlap with merits panel; regulations may prescribe that a different group than the PTAB make the decision to institute altogether.

  • Court Report

            By Sherri Oslick —

    Gavel About Court Report:  Each week we will report briefly on recently filed biotech and pharma cases.

    Idenix Pharmaceuticals LLC et al. v. Gilead Pharmasset LLC
    1:15-cv-00416; filed May 21, 2015 in the District Court of Delaware

    • Plaintiffs:  Idenix Pharmaceuticals LLC; Universita Degli Studi di Cagliari; Centre National de la Recherche Scientifique; Universite de Montpellier
    • Defendant:  Gilead Pharmasset LLC

    Review of the decision of the Patent Trial and Appeal Board awarding priority of invention to Gilead between U.S. Patent Application Serial No. 11/854,218 ("Modified Fluorinated Nucleoside Analogues," filed September 12, 2007), assigned to Gilead, and U.S. Patent No. 7,608,600 ("Modified 2' and 3'-Nucleoside Prodrugs for Treating Flaviviridae Infections," issued October 27, 2009), assigned to plaintiffs.  View the complaint here.

    Sanofi et al. v. Lupin Atlantis Holdings SA et al.
    1:15-cv-00415; filed May 21, 2015 in the District Court of Delaware

    • Plaintiffs:  Sanofi; Sanofi-Aventis US LLC
    • Defendants:  Lupin Atlantis Holdings SA; Lupin Ltd.; Lupin Pharmaceuticals Inc.

    Infringement of U.S. Patent Nos. 8,318,800 ("Solid Pharmaceutical Compositions Containing Benzofuran Derivatives," issued November 27, 2012) and 8,410,167 ("Use of Dronedarone for the Preparation of a Medicament for Use in the Prevention of Cardiovascular Hospitalization or of Mortality," issued April 2, 2013) following a Paragraph IV certification as part of Lupin's filing of an ANDA to manufacture a generic version of Sanofi's Multaq® (dronedarone, used to reduce the risk of hospitalization for atrial fibrillation in patients in sinus rhythm with a history of paroxysmal or persistent atrial fibrillation).  View the complaint here.

    Horizon Pharma Ireland Ltd. et al. v. IGI Laboratories, Inc.
    1:15-cv-03508; filed May 21, 2015 in the District Court of New Jersey

    • Plaintiffs:  Horizon Pharma Ireland Ltd.; HZNP Ltd.; Horizon Pharma USA, Inc.
    • Defendant:  IGI Laboratories, Inc.

    Infringement of U.S. Patent Nos. 8,217,078 ("Treatment of Pain with Topical Diclofenac," issued July 10, 2012), 8,252,838 ("Diclofenac Topical Formulation," issued August 28, 2012), 8,546,450 ("Treatment of Pain with Topical Diclofenac," issued October 1, 2013), 8,563,613 ("Diclofenac Topical Formulation," issued October 22, 2013), 8,618,164 ("Treatment of Pain with Topical Diclofenac," issued December 31, 2013), and 8,871,809 ("Diclofenac Topical Formulation," issued October 28, 2014) following a Paragraph IV certification as part of IGI's filing of an ANDA to manufacture a generic version of Horizon's Pennsaid® (diclofenac sodium topical solution, used for the treatment of signs and symptoms of osteoarthritis of the knee(s)).  View the complaint here.

    Kowa Co., Ltd. et al. v. Lupin Ltd. et al.
    1:15-cv-03935; filed May 21, 2015 in the Southern District of New York

    • Plaintiffs:  Kowa Co., Ltd.; Kowa Pharmaceuticals America, Inc.; Nissan Chemical Industries, Ltd.
    • Defendants:  Lupin Ltd.; Lupin Pharmaceuticals, Inc.

    Infringement of U.S. Patent No. 8,557,993 ("Crystalline Forms of Pitavastatin Calcium," issued October 15, 2013) following a Paragraph IV certification as part of Lupin's filing of an ANDA to manufacture a generic version of Kowa's Livalo® (pitavastatin, used as an adjunctive therapy to diet to reduce elevated total cholesterol, lowdensity lipoprotein cholesterol, apolipoprotein B, triglycerides, and to increase high-density lipoprotein cholesterol).  View the complaint here.

    Merck & CIE et al. v. Lupin Ltd. et al.
    1:15-cv-01472; filed May 21, 2015 in the District Court of Maryland

    • Plaintiffs:  Merck & Cie; Bayer Pharma AG; Bayer HealthCare Pharmaceuticals Inc.
    • Defendants:  Lupin Ltd.; Lupin Pharmaceuticals, Inc.

    Merck & Cie et al. v. Lupin Ltd. et al.
    1:15-cv-00407; filed May 20, 2015 in the District Court of Delaware

    • Plaintiffs:  Merck & Cie; Bayer Pharma AG; Bayer HealthCare Pharmaceuticals Inc.
    • Defendants:  Lupin Ltd.; Lupin Pharmaceuticals, Inc.

    The complaints in these cases are substantially identical.  Infringement of U.S. Patent No. 6,441,168 ("Stable Crystalline Salts of 5-methyltetrahydrofolic Acid," issued August 27, 2002), licensed to Bayer, following a Paragraph IV certification as part of Lupin's filing of an ANDA to manufacture a generic version of Bayer's Safyral® (drospirenone, 17α-ethinyl estradiol, and levomefolate calcium, used for oral contraception).  View the Delaware complaint here.

    Eli Lilly and Company et al. v. HEC Pharm USA, Inc. et al.
    1:15-cv-00792; filed May 20, 2014 in the Southern District of Indiana

    • Plaintiffs:  Eli Lilly and Company; Daiichi Sankyo Co., Ltd.; Daiichi Sankyo, Inc.; Ube Industries, Ltd.
    • Defendants:  HEC Pharm USA, INC.; HEC Pharm Co., Ltd.

    Infringement of certain of U.S. Patent Nos. 8,404,703 ("Medicinal Compositions Containing Aspirin," issued March 26, 2013) and 8,569,325 ("Method of Treatment with Coadministration of Aspirin and Prasugrel," issued October 29, 2013) following a Paragraph IV certification as part of HEC's filing of an ANDA to manufacture a generic version of Lilly's Effient® (prasugrel hydrochloride, to be used in combination with aspirin for the reduction of thrombotic cardiovascular events in certain patients with acute coronary syndrome (ACS) who are to be managed with percutaneous coronary intervention).  View the complaint here.

    Gilead Sciences Inc. et al. v. AbbVie Inc.
    1:15-cv-00399; filed May 19, 2015 in the District Court of Delaware

    • Plaintiffs:  Gilead Sciences Inc.; Gilead Sciences Ireland Unlimited Co.
    • Defendant:  AbbVie Inc.

    Declaratory judgment of invalidity of U.S. Patent No. 9,034,832 ("Solid Compositions," issued May 19, 2015), allegedly covering Gilead's formulation and use of its Harvoni® product (Sofosbuvir and Sofosbuvir, used to treat Hepatitis C Virus).  View the complaint here.


    Cephalon Inc. v. Apotex Inc. et al.
    1:15-cv-00404; filed May 19, 2015 in the District Court of Delaware

    • Plaintiff:  Cephalon Inc.
    • Defendants:  Apotex Inc.; Apotex Corp.

    Infringement of U.S. Patent Nos. 8,445,524 ("Solid Forms of Bendamustine Hydrochloride," issued May 21, 2013) and 8,436,190 ("Bendamustine Pharmaceutical Compositions," issued May 7, 2013), 8,609,863 (same title, issued December 17, 2013), and 8,791,270 (same title, issued July 29, 2014), 8,669,279 ("Solid Forms of Bendamustine Hydrochloride," issued March 11, 2014), 8,883,836 (same title, issued November 11, 2014), and 8,895,756 ("Bendamustine Pharmaceutical Compositions," issued November 25, 2014) following a Paragraph IV certification as part of Apotex's filing of an ANDA to manufacture a generic version of Cephalon's Treanda® (bendamustine hydrochloride, used to treat chronic lymphocytic leukemia and non-Hodgkin's lymphoma).  View the complaint here.

  • Amgen v. Sandoz — Federal Circuit Oral Argument

    By Andrew Williams —

    Federal Circuit SealThe Federal Circuit heard oral arguments in the Amgen v. Sandoz case on Wednesday, June 3, 2015.  The three judges on the panel were Judge Newman, Judge Lourie, and Judge Chen.  This case is on appeal from the U.S. District Court for the Northern District of California, where Judge Seeborg denied Amgen's motion for a partial judgement on the pleadings and for a preliminary injunction.

    One of the main issues on appeal was whether the disclosure and patent exchange provisions (the so-called "patent dance") of the Biologics Price Competition and Innovation Act ("BPCIA") is mandatory or whether either party can opt out of the requirements and settle for the remedy specified in the statute.  As a reminder, the patent dance kicks off with the disclosure of the biosimilar application, as well as the process of manufacture, by the subsection (k) applicant.  The statute at subsection (l)(2) reads:

    (2) SUBSECTION (k) APPLICATION INFORMATION.—Not later than 20 days after the Secretary notifies the subsection (k) [biosimilar] applicant that the application has been accepted for review, the subsection (k) applicant—
        (A) shall provide to the reference product sponsor a copy of the application submitted to the Secretary under subsection (k), and such other information that describes the process or processes used to manufacture the biological product that is the subject of such application; and
        (B) may provide to the reference product sponsor additional information requested by or on behalf of the reference product sponsor. [emphasis added]

    42 U.S.C. § 262(l)(2).  The panel wasted no time in cutting to the chase, when Judge Lourie interrupted counsel for Amgen almost at the outset, noting "[w]hat you are going to tell us . . . is that 'shall' means 'shall' — in fact it means 'must.'"  This has, of course, been Amgen's position since it was first notified that Sandoz did not intend to participate in this disclosure process.

    Sandoz, for its part, has maintained that the use of the term "shall" does not mean that a biosimilar applicant must provide a copy of its application in every instance, but only if it wishes to partake in the benefits of the patent dance.  Judge Newman has a different take on that question — it was not whether to partake in this particular subpart of the BPCIA, but rather whether to partake in the entirety of the BPCIA process — including the abbreviated approval process:

    If you want my data — if you want to be a (k) applicant, which I gather Sandoz has done, right — has used the data, hasn't gone through their own clinical trials or all the rest of it — then this is what you "shall" do.  You don't have to use the Amgen data, you can create your own, then you are home free.

    While counsel for Sandoz disagreed, Judge Newman continued:

    But why isn't it the question — if you have a statute, this integrated statute, there were — from the record it looks as if there were extensive hearings, tradeoffs, debates, connections with the pros and cons of Hatch Waxman for biosimilars — and here we have a complicated statute and you say only some of it counts.

    Of course, it is unfortunately not as simple as saying that this is an "integrated statute."  Instead, once you start looking at the entirety of the statute, it gets a lot more complicated.  As Judge Lourie noted — the BPCIA should win the "Pulitzer prize for complexity or uncertainty."  The patent dance is outlined in subsection (l)(2)-(6) of the statute, whereas subsection (l)(9)(c) purports to provide a remedy should the biosimilar applicant not disclose the requisite information:

    If a subsection (k) applicant fails to provide the application and information required under paragraph (2)(A), the reference product sponsor, but not the subsection (k) applicant, may bring an action under section 2201 of Title 28, for a declaration of infringement, validity, or enforceability of any patent that claims the biological product or a use of the biological product.

    42 U.S.C. § 262(l)(9)(C).  Sandoz has maintained that because the remedy is already provided for in the statute, the subsection (k) applicant is free to disregard the seemingly mandatory disclosure provision, provided it is willing to accept the consequences.

    Judge Chen clearly struggled with trying to reconcile the statute as a whole.  On the one hand, he had one of the most quoted lines of the hearing:  "I don't see through the language or the structure of (l) where there's a hint that it's a 'choose-your-own-adventure' situation for the (k) applicant."  However, Judge Chen ran that thought to its logical conclusion, noting that even if the provision is determined to be mandatory, you might end up in the same situation — with the patent infringement remedy outlined by the statute.

    To this point, Amgen presented a compelling, yet somewhat buried, response.  If § 262(l)(9)(C) were meant to be the exclusive remedy for non-compliance with the disclosure provision, the biosimilar applicant would be put into a much better position than it would have been otherwise.  The statute envisions and anticipates patent litigation with regard to methods of manufacturing the biosimilar drug product — indeed it is one of the specified types of information that must be disclosed by the subsection (k) applicant.  However, if the biosimilar applicant refuses to "dance," § 262(l)(9)(C) only allows for a DJ action with respect to patents covering the biological product or the uses thereof (apparently in a nod to the Hatch Waxman statute).  And this is to say nothing of the problem that, without the disclosure of the recited information, the reference product sponsor will have difficulty knowing with certainty just which patents are being infringed.  With the biosimilar applicant facing such overwhelming incentives, it will likely be the rare situation where it will choose to make the appropriate disclosures and initiate the patent dance.

    Part of the problem, as Judge Chen noted, is that there is really nothing tying subsection (l) to subsection (k).  Instead, activities involving the FDA fall under subsection (k), while matters involving the resolution of patent infringement claims fall under subsection (l).  Congress could have done a better job ensuring that progress of the application before the FDA could not continue (or at least be substantially delayed) unless the subsection (k) applicant participated in the patent dance.  Indeed, Amgen was rebuffed when it requested that the FDA require biosimilar applicants to "certify" compliance with the subsection (l) disclosure requirements (see "Amgen Receives No Help from the FDA — A Biosimilar Update").  A possible solution would be for the Federal Circuit to fashion some remedy that would leave the statute intact, but provide for the ability of district courts to enjoin the FDA if biosimilar applicants are non-compliant.

    The other main issue argued before the Court was whether Sandoz's Notice of Commercial Marketing was effective when it was made shortly after the application was accepted, as opposed to making it after the application was approved.  The questioning from the three judges seemed to suggest that the statute did not make sense unless the Notice was provided after the latter, or post-approval notice.  For example Judge Chen suggested that:  "it sounds a little nonsensical to say that that is an appropriate form of Notice of Commercial Marketing when you don't have any clue on whether your application will ever get approved," much less when.  He used the term "aspirational" to refer to such notice just after acceptance.  Nevertheless, the question was raised by the Court whether setting the "Notice" date after application approval would inappropriately extend the exclusivity period of the reference product sponsor — at least in situations like this for Amgen.

    The Court did ask what remedy Amgen was seeking on appeal.  It is important to note that this is a somewhat atypical case, in which Amgen's composition-of-matter patent has already expired, and the data exclusivity period is well beyond the 14 years contemplated by the statute.  Nevertheless, everyone appeared to be in agreement that any decision needed to be applicable not only to this case, but to all more "typical" cases that might arise.  Amgen asked that it be put back in the position it would have been if Sandoz had complied with the statute at the outset.  It also stressed that it did not want a "windfall."  However, as for the particulars, it simply asked the Court to rule in Amgen's favor and remand to the District Court to fashion the appropriate remedy.

    There was one particularly troubling tangential comment by Judge Newman, at least from the perspective of Hatch Waxman litigation.  While discussing the artificial act of infringement related to the BPCIA, or 35 U.S.C. § 271(e)(2)(c)(ii), Judge Newman inquired whether it was correct that the comparable provision for Hatch Waxman, 35 U.S.C. § 271(e)(2)(a), set the act of infringement as the certification pursuant to paragraph IV.  Counsel for Amgen correctly noted that the statute only mentions the submission of the ANDA application, and is silent as to the paragraph IV certification.  However, this issue has already been addressed by the Federal Circuit in the Astra Zeneca v. Apotex case, where it concluded that, in order to establish subject matter jurisdiction pursuant to § 1338(a), nothing more than alleging infringement by the filing of an ANDA was required (see "AstraZeneca Pharmaceuticals LP v. Apotex Corp. (Fed. Cir. 2012)").  Moreover, almost every jurisdiction that has now considered this question has determined that a paragraph IV certification is not a prerequisite for jurisdiction under 271(e)(2).  In fact, at least two jurisdictions that at one point had come to the opposite conclusion (the Northern District of Illinois and the District of New Jersey), have since conformed to this majority position.  We can only hope that this case does not include some dicta on the subject that could create uncertainty moving forward.

    We will continue to monitor this case for any unusual development, and we will of course report on the outcome of this appeal in due course.

  • Conference & CLE Calendar

    CalendarJune 4, 2015 – "Litigating Inducement and Willfulness after Commil and Akamai" (Intellectual Property Owners Association) – 2:00 to 3:00 pm (ET)

    June 9, 2015 – "Claim Construction Caselaw Update: Mechanical & Chemical Arts" (American Intellectual Property Law Association) – 12:30 to 2:00 pm (Eastern)

    June 9, 2015 – Patent Quality Chat webinar series — Clarity of the Record – noon to 1:00 pm (EDT)

    June 9, 2015 – European biotech patent law update (D Young & Co) – 4:00 am, 7:00 am, and 12:00 pm (EDT)

    June 9-10, 2015 – Due Diligence Summit for Life Sciences*** (ExL Events) – Boston, MA

    June 10, 2015 – "Past, Present, and Future of Post-Grant Proceedings at the PTAB" (American Intellectual Property Law Association) – 12:30 – 2:00 pm (Eastern)

    June 15-17, 2015 – Fundamentals of Patent Prosecution 2015: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) – New York, NY

    June 15-18, 2015 – BIO International Convention (Biotechnology Industry Organization) – Philadelphia, PA

    June 18, 2015 – "Patent Infringement Letters: Considerations and Best Practices for Senders and Recipients — Patent Holder Strategies for Leveraging Letters and Avoiding DJ Actions; Defense and Response Strategies for Alleged Infringers" (Strafford) – 1:00 to 2:30 pm (EDT)

    June 23, 2015 – "Practical Patent Prosecution Strategies and Considerations" (American Bar Association (ABA) Center for Professional Development, Section of Intellectual Property Law, and Young Lawyers Division) – 1:00 to 2:30 pm (ET)

    June 25, 2015 – "Patent Inventorship: Best Practices for Determination and Correction" (Strafford) – 1:00 to 2:30 pm (EDT)

    July 8-10, 2015 – Fundamentals of Patent Prosecution 2015: A Boot Camp for Claim Drafting & Amendment Writing (Practising Law Institute) – San Francisco, CA

    July 14, 2015 – Patent Quality Chat webinar series – Face-to-face Examiner Interviews: A Demonstration of USPTO Tools – noon to 1:00 pm (EDT)

    August 11, 2015 – Patent Quality Chat webinar series – Measuring Patent Quality – noon to 1:00 pm (EDT)

    August 12-14, 2015 – Advanced Patent Law Seminar (Chisum Patent Academy) – Seattle, WA

    ***Patent Docs is a media partner of this conference or CLE

  • IPO Webinar on Litigating Inducement and Willfulness

    IPO #2The Intellectual Property Owners Association (IPO) will offer a one-hour webinar entitled "Litigating Inducement and Willfulness after Commil and Akamai" on June 4, 2015 from 2:00 to 3:00 pm (ET).  Paul Berghoff of McDonnell Boehnen Hulbert & Berghoff LLP, Steven Moore of Kilpatrick Townsend & Stockton, and Frank Nuzzi of Siemens Corporation will consider where the law surrounding the inducement of patent infringement stands now and give their thoughts on questions such as:

    • Does Commil increase the value of opinions of counsel for non-infringement?  The opinion states that a "reasonable" reading of the patent that results in non-infringement can be a defense to inducement.
    • How will Commil be used in cases involving willfulness?
    • Will patentees succeed in arguing that a good-faith belief in invalidity should not be a defense to willfulness?
    • Is the next step for the issue of divided infringement at the Federal Circuit or at the U.S. Supreme Court?
    • What strategy should litigants or potential litigants follow in the meantime?

    The registration fee for the webinar is $130 (government and academic rates are available upon request).  Those interested in registering for the webinar can do so here.

  • European Biotech Patent Law Webinar

    D Young & CoD Young & Co will be offering its next European biotech patent law update on June 9, 2015.  The 45-minute webinar will be offered at three times: 4:00 am, 7:00 am, and 12:00 pm (EDT).  D Young & Co European Patent Attorney Simon O'Brien 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.