A System is Not a Method (Unless §101 is Involved)

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In Jazz Pharmaceuticals, Inc., v. Avadel CNS Pharmaceuticals, LLC, [2023-1186] (February 24, 2023) the Federal Circuit lifted its stay on an injunction directing Jazz to take measures to delist U.S. Patent 8,731,963 from the FDA’s orange book, and affirmed the district court’s decision.

Claim 1 of the ‘963 patent was directed to “A computer-implemented system for treatment of a narcoleptic patient with a prescription drug that has a potential for misuse, abuse or diversion.”  Claim 6, the other claim at issue, was dependent on claim 1.  Under the Hatch-Waxman Act (21 U.S.C. § 355(b)(1)(A)(viii)), when a drug developer files an NDA, information on each patent “for which a claim of patent infringement could reasonably be asserted” must be submitted to the FDA if the patent claims either (i) the drug submitted for approval, or a formulation or composition thereof, or (ii) “a method of using such drug for which approval is sought or has been granted in the application.”

Avadel responded to Jazz’s infringement assertions with a counterclaim seeking delisting of the ’963 patent for failure to claim a drug or method of use. In evaluating the counterclaim, the district court found that, as a matter of claim construction, the ’963 patent claims a system and thus does not claim an approved method of use. The district court subsequently ordered Jazz to ask the FDA to delist the ’963 patent.  Jazz filed a notice of appeal and moved the district court to stay the injunction pending appeal, when the district court denied the stay, the Federal Circuit extended the stay until it could evaluate the issue on the merits.

The district court determined that the ’963 patent claims recited systems, not methods. Jazz contends that the word “system” as it appears in the ’963 patent claims is, essentially, a synonym for “method.” But, the Federal Circuit noted, method claims require the performance of steps; claims that describe physical components of a whole are system, or apparatus, claims.  The Federal Circuit said that the fact that the claimed systems can be used in the course of treating patients suffering from narcolepsy did not alter the fact that these are system claims.  It therefore found that the claims of the ’963 patent were properly construed by the district court as system claims, not method claims.

Jazz contended that FDA regulations which describes listing patents that “claim conditions of use,” yields a broader definition of “method” than permitted by the language of patent law and that this broader definition encompasses the claims of the ’963 patent.  Jazz argued that since prescribers were bound to follow the system in treating patients with narcolepsy. The Federal Circuit said that Jazz misread the

regulation describing method-of-use patents. The regulations do not broaden the term “method” such that reciting a condition of use turns a system patent into a listable method-of-use patent. Rather, this regulation narrows that category of listable patents to those that (1) claim methods of use, wherein (2) those methods of use are directly relevant to the NDA in question.

The Federal Circuit thus affirmed the district court, and lifted the stay, restarting the 14-day period for compliance prescribed by 21 C.F.R. § 314.53(f)(2)(i) to be within 14 days of its

decision. Although not directly relevant, it is interesting to note that the Federal Circuit approves treating apparatus claims like method claims in §101 eligibility analysis.  Too bad that that reasoning didn’t work for Jazz.

Mardi Gras 2023

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From masks to beads, patents protect a number products for celebrating Mardi Gras, including:

U.S. Patent No. 4,864,663 protects an integral costume mask and display headgears, suitable for Mardi Gras celebrations:

U.S. Patent No. 5,135,390, protects a Flambeau Torch:

U.S. Patent No. 5,219,069 protects a chainable Plastic Coin Holder for collecting Mardi Gras coins:

U.S. Patent No. 5,787,508 protects a Decorative Mask Assembly suitable for Mardi Gras celebrations:

U.S. Patent No. 5,896,756 discloses a Soft Necklace suitable for throwing at Mardi Gras:

U.S. Patent No. 6,296,364 discloses a Lighted Bead Necklace, suitable for wearing at Mardi Gras:

U.S. Patent No. 6,578,981 discloses another version of a Lighted Bead Necklace suitable for wearing at Mardi Gras:

U.S. Patent No. 6,991,141 discloses Methods of Producing and Treating Twisted Beads for Mardi Gra celebrations:

U.S. Patent No. 8,672,169 protects a Novelty Cup with Jewelry for your Mardi Gras libations:

U.S. Patent No. D611117 protects a Mardi Gras Doubloon Fishing Lure:

U.S. Patent No. 8,082,753 protects Beverage Bead for holding your Mardi Gras hurricane:

Presidents Day 2023

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U.S. Patent No. 5,288,076 turns presidential election into a game (funny how patents imitate life):

U.S. Patent No. 2536 protects the appearance of an Andrew Jackson medal:

U.S. Patent No. 3274 protects the appearance of a Design for a Clock Case, featuring Abraham Lincoln.

U.S. Patent No. 2983 protects the appearance of a sculpture of Abraham Lincoln and his Council of War:

U.S. Patent No. 6071 protects the appearance of a medal featuring President Grant (and Senator H. Wilson:

U.S. Patent No. 8581 protects the design of a medal featuring a tree with eighteen
branches representing the eighteen administrations, which are indicated by the names of the
Presidents of the United States:

U.S. Patent No. D8593 protects the appearance of a flag with the names of the first eighteen presidents:

U.S. Patent No. 169085 protects a Revolving Game Apparatus, featuring the first eighteen presidents:

U.S. Patent No. D9239 protects the appearance of a badge with the images of George Washington and Ulysses Grant.

U.S. Patent No. 9418 protects the design for a charm, medal, or badge that features the image of Rutherford B. Hayes, and William A. Wheeler:

U.S. Patent No. D9482 protects the design of a shirt with the images of Rutherford B. Hayes and William A, Wheeler.

A Court Can Only Enjoin Public Accusations of Infringement if They Are Objectively Baseless

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In Lite-Netics, LLC v. Nu Tsai Capital, LLC, [2023-1146] (February 17, 2023), the Federal Circuit vacated a preliminary injunction against Lite-Netics patent-related speech, holding that the district court abused its discretion.

Lite-Netics brought a patent-infringement action against HBL, and sent two notices,
one before filing suit and one after, to its customers (some of which were also HBL customers), informing them of allegedly infringing competitors in the market and stating Lite-Netics’s intent to enforce its patent rights. HBL counterclaimed for several state-law torts, and moved for a temporary restraining order and a preliminary injunction, based on two of the state law counterclaims, which the district court granted.

Lite-Netics owns multiple patents on magnetic holiday string lights. HBL, a former customer of Lite-Netics, also sells holiday string lights.

Lite-Netics owns multiple patents on magnetic holiday string lights. HBL, a former customer of Lite-Netics, also sells holiday string lights. Lite-Netics send a notice to the trade that Lite-Netics’s magnetic string lights were protected by U.S. Patent Nos. 7,549,779 and 8,128,264; that other companies were attempting to “copy” Lite-Netics’s patented products; that Lite-Netics had filed a patent infringement lawsuit against HBL to stop it from making and selling infringing products; and that Lite-Netics was also considering including any known company using or reselling the HBL products as co-defendants in this lawsuit.

The district court addressed (1) the likelihood of HBL’s success on the merits of its tortious-interference and defamation claims; (2) the likelihood of irreparable injury
to HBL without the injunction; (3) the balance of equities; and (4) the public interest.

In considering the first factor, the court recognized that state-law tort claims based on the communication of patent rights, such as HBL’s tortious-interference and defamation claims, “are preempted by federal patent laws, unless the claimant can show that the patent holder acted in bad faith.” However the district court concluded that HBL’s state-law tort claims were not preempted here, centrally because it held that Lite-Netics’s infringement allegations were so clearly meritless that their assertion was in bad faith. On that basis, the court ruled that HBL would likely succeed on its tortious-interference and defamation claims
and that the preliminary injunction should issue, because the non-merits preliminary-injunction considerations favored issuance.

The Federal Circuit has held that federal patent law preempts state law tort liability for a patentholder’s good faith conduct in communications asserting infringement of its patent and
warning about potential litigation. Thus, the Federal Circuit said that HBL’s state-law claims
here thus can survive federal preemption only to the extent that those claims are based on a showing of ‘bad faith’ action in asserting infringement. The requirement of a showing of bad faith as prerequisite to applying state tort law to speech about infringement rests partly on First Amendment principles. Thus, a bad faith standard cannot be satisfied in the absence of a showing that the claims asserted were objectively baseless, and a patent-infringement allegation is objectively baseless only if no reasonable litigant could realistically expect
success on the merits.

Lite-Netics argued on appeal that the district court erred in finding its infringement allegations concerning the ’779 patent, and its application to both accused products, to be objectively baseless, and the Federal Circuit agreed. Because there was an objectively reasonable basis for many of Lite-Netics’s infringement allegations, the district court abused its discretion in finding that Lite-Netics could not have “realistically expect[ed] success on the merits” and, therefore, acted in bad faith.

The Federal Circuit noted that the preliminary injunction was to a large extent based on three legal conclusions with respect to Lite-Netics’s assertion of the ’779 patent, but concluded that Lite-Netics’s position on all three of those disputes has not been shown, at this stage of the litigation, namely before full claim-construction proceedings or possible expert reports on infringement), to be objectively baseless. That conclusion requires vacatur of the preliminary injunction, without finally resolving the underlying disputes about claim construction, prosecution history estoppel, or other issues.

Storing and Displaying Video is an Abstract Idea

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In Hawk Technology Systems, LLC v. Castle Retail, LLC, [2022-1222] (February 17, 2022), the Federal Circuit affirmed the dismissal of the suit because the asserted patent claims of U.S. Patent No. 10,499,091 on a method of viewing multiple simultaneously displayed and
stored video images on a remote viewing device of a video surveillance system were directed to ineligible subject matter and therefore invalid under 35 U.S.C. § 101.

The district court concluded that the ’091 patent claims were directed to the abstract idea of “storing and displaying video,” and the Federal Circuit agreed, noting that the claims are similar to those it has found to be directed to abstract ideas. The Court noted that in Adaptive Streaming Inc. v. Netflix, Inc., 836 F. App’x 900, 903 (Fed. Cir. 2020), it held that “encoding and decoding image data and . . . converting formats, including when data is received from one medium and sent along through another, are by themselves abstract
ideas.”

While Hawk characterized its invention as a solution to a technical problem in multi-format digital video product systems, the Federal Circuit pointed out that even a specification full of technical details about a physical invention may nonetheless conclude with claims that claim
nothing more than the broad law or abstract idea underlying the claims. The claims fail to recite a specific solution to make the alleged improvement— conserving bandwidth while preserving quality—“concrete” and at most recite abstract data manipulation.

At Alice step two, the Federal Circuit said that the district court found that the claims, “read in light of the specification, do not show a technological improvement in video storage and display because the limitations can be implemented using generic computer elements,” and that the “specification and claims do not explain or show how the monitoring and storage is improved, except by using already existing computer and camera technology,” and thus the claims failed at Alice step two. The Federal Circuit agreed.

Again, Hawk argued that the claims recite an inventive solution, but the Federal Circuit said that even if the claims achieved the purported solution, they only use generic functional language to do so and require nothing other than conventional computer and network components operating according to their ordinary functions. The Federal Circuit said that it recognize that the claims include “parameters,” but the claims fail to specify precisely what the parameters are and the parameters at most concern abstract data manipulation image formatting and compression.

The Federal Circuit therefore found that the ’091 patent claims fail to transform the abstract idea into something more and thus fail Alice step two. The Court that held that the ’091 patent is patent ineligible because its claims are directed to an abstract idea and fail to
transform that abstract idea into patent-eligible subject matter.

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Functional Medical Device Demonstrated at Trade Show Trigged On Sale Bar of pre-AIA 102(b)

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In Minerva Surgical, Inc. v. Hologic, Inc., [2021-2246] (February 15, 2023), the Federal Circuit affirmed summary judgment that the asserted claims of U.S. Patent No. 9,186,208 on surgical devices for a procedure called endometrial ablation were anticipated under the public use bar of pre-AIA 35 U.S.C. § 102(b).

The Federal Circuit first pointed out that the patented technology was “in public use” because, before the critical date, Minerva disclosed fifteen devices having the technology at AAAGL 2009, an industry related event dubbed “the Super Bowl of [the] industry” by one of the inventors. Minerva’s disclosure of these devices spanned several days and included Minerva showcasing them at a booth, in meetings with interested parties, and in a technical presentation, and a brochure. Minerva did not disclose the devices under any confidentiality obligations, despite the commercial nature of the event. The Federal Circuit said that an invention is in public use if it is shown to or used by an individual other than the inventor under no limitation, restriction, or obligation of confidentiality.

The Federal Circuit then pointed out that at the time of the public use, the technology
was “ready for patenting.” Specifically, Minerva had created working prototypes and enabling technical documents describing the claimed technology. The Federal Circuit said that “ready for patenting can be shown in at least two ways: (1) a reduction to practice before the critical date; (2) or proof that before the critical date the inventor had prepared drawings or other descriptions of the invention sufficiently specific to enable a person or ordinary skill in the art to practice the invention.

Minerva raised three reasons why the invention was not in public use at the AAGL 2009″ First, Minerva argued that it “merely displayed” the device. The Federal Circuit rejected this, noting that the device was actually demonstrated with a transparent uterine model. The Federal Circuit distinguished Motionless Keyboard relied upon by Minerva, because that case involved a visual view of the device without any disclosure of the claimed technology,and finding that Minerva’s disclosure went “well beyond” the disclosure in Motionless Keyboard. Second, Minerva argued that there was no disclosure of the claimed invention. The Federal Circuit rejected the contention that the public had to actually handle the device, saying that all is required is that the public understood the invention, and the feedback collected from the AAGL 2009 showed that Minerva allowed knowledgeable individuals to scrutinize the invention enough to recognize and understand the technology Minerva later sought to patent. Third, Minerva argued that the invention was not “ready for patenting” because Minerva was still making improvements. The Federal Circuit rejected this for two reasons: (1) Minerva reduced the invention to practice and (2) Minerva had enabling documentation describing the invention.

The Federal Circuit then concluded that district court thus correctly granted summary judgment of invalidity because there are no genuine factual disputes, and defendants are entitled to judgment as a matter of law that the asserted claims are anticipated under
the public use bar of § 102(b).

Happy Valentine’s Day 2023 – Ten Patents to Set the Mood

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The U.S. patent collection has patents for every occasion, and Valentine’s Day is no exception. Here are ten patents to set mood for the day:

U.S. Patent No. 1,248,916 provides a paper decoration for your festivities.
U.S. Patent No. 1,353,709 provides a heart-shaped token (and a corny poem).

U.S. Patent No. 2,101,592 provides a novelty display, adaptable to many occasions, including Valentine’s Day.
U.S. Patent No. PP 645 provides a carnation that the invention claims is particularly adapted for Valentine’s Day
U.S. Patent No. 2,726,397 provides an apron with a replaceable applique, including one perfect for Valentine’s Day.
U.S. Patent No. 3,016,178 provides the definitive box for Valentine’s Day treats.
U.S. Patent No. 3,139,231 provides a symbolic tear string envelope or package, perfect for that sentimental Valentine’s Day card.
U.S> Patent No. 3,610,510 provides a plastic heart shaped box perfect for that Valentine’s Day gift.
U.S. Patent No. 5,035,391 provides a heart shaped balloon anchor for your lighter-than air Valentine’s Day gift.
U.S. Patent No. 5,561,928 provides a collapsible greeting display perfect for Valentine’s Day.

The Canons of Claim Construction Showed that the District Court was Half Right and Half Wrong

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In SSI Technologies, LLC v, Dongguan Zhengyang Electronic Mechanical Ltd., [2021-2345, 2022-1039] (February 13, 2023) the Federal Circuit affirmed in part, reversed in part, vacated in part, and remanded the district court’s grant of summary judgment to DZEM on SSI’s infringement
claims, dismissal of DZEM’s invalidity counterclaims, and granted summary judgment to SSI on the tortious interference counterclaim.

SSI has asserted U.S. Patent Nos. 8,733,153 and 9,535,038, generally directed to sensors for determining the characteristics of fluid in a container, such as a fuel tank.against DZEM. this case.

The dispute in the district court regarding the ’153 patent turned mainly on the limitation in claim 1 that recites a controller configured to determine whether a contaminant exists in the
fluid based on the temperature of the fluid, a time period from when the sound wave is produced to when the echo is detected, and at least one of the group of a) whether a measured volume is out of range and b) a dilution of the fluid is detected while the measured volume of the fluid decreases. The district court construed the second item of the Markush group in that limitation, “a dilution of the fluid is detected while the measured volume of the fluid decreases,” to require that the contaminant determination actually consider the measured volume of the fluid. This construction was based upon the district court’s determination that amendments to the claim during prosecution was designed to incorporate the error-detection capability recited in the specification.

The Federal Circuit agreed with the district court, noting that the language “measured volume” in the claim requires that the volume of the liquid in the tank must be determined and considered as part of the contamination analysis recited in claim 1. The Court pointed out that a claim construction that gives meaning to all the terms of the claim is preferred over
one that does not do so. Thus the Federal Circuit affirmed summary judgment of non-infringement as to the ‘153 patent.

With respect to the ’038 patent, the dispute in the district court turned mainly on the district court’s construction of the term “filter” and its application of that construction in its infringement analysis. The district court adopted DZEM’s proposed construction of “filter,”
construing the term to mean “a porous structure defining openings, and configured to remove impurities larger than said openings from a liquid or gas passing through the
structure.” Since the DZEM device had a non-porous cover, the court found no infringement.

The Federal Circuit disagreed with the district court construction of filter. The Court said that the specification of the ’038 patent contains no requirement regarding the size of the filter openings. The Federal Circuit conceded that each embodiment disclosed in the ’038 patent contains a mesh filter, which has very small openings, but stated that the scope of a claim is not ordinarily limited to preferred embodiments or specific examples in the specification. The Court said that while the specific embodiments of the filters disclosed in the ’038 patent specification contain small holes, the general references to a “filter” in the specification are quite broad and do not reflect an intent to limit the term “filter” to the disclosed embodiments. In particular the reference to use of the mesh was limited to “some embodiments.” The Federal Circuit concluded that as long as the openings in the filter are small enough to prevent at least some gas bubbles from entering the sensing area, the openings need
not be smaller than any particular maximum size.

In light of this construction, the Federal Circuit vacated the grant of summary judgment of the ‘038 patent in its entirety, and remanded for further proceedings.

On the grant of summary judgment to SSI on DZEM’s tortious interference
counterclaim, the Federal Circuit said that in order to assert a claim “that a patent
holder has engaged in wrongful conduct by asserting claims of patent infringement,” the plaintiff “must establish that the claims of infringement were objectively baseless.” The Federal Circuit said that the district court held that SSI’s infringement claims were not objectively baseless, and that it discerned no error in that conclusion, pointing to SSI’s expert report regarding infringement as evidence that the suit was not objectively baseless. The Court said that the existence of an expert opinion can be evidence that a party’s position is not unreasonable, even if there is conflicting expert testimony in the record. DZEM was required to establish by clear and convincing evidence that SSI’s infringement suit was objectively baseless, but it failed to introduce any evidence of objective baselessness. Thus, the Federal Circuit affirmed the district court’s grant of summary
judgment to SSI on the tortious interference counterclaim.

Isolating Naturally Occurring Nicotinamide Riboside Did Not Make the Composition Patentable

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In Chromadex, Inc. v. Elysium Health, Inc., [2022-1116] (February 13, 2023), the Federal Circuit affirmed the grant of summary judgment that the asserted claims of U.S. Patent No. 8,197,807 on dietary supplements containing isolated nicotinamide riboside are directed to unpatentable subject matter.

The district court construed several claim terms including “isolated nicotinamide riboside” to mean “nicotinamide riboside that is separated or substantially free from at least some other components associated with the source of nicotinamide riboside.” The district court concluded that the claims were directed to a natural phenomenon, namely, “compositions
comprising isolated nicotinamide riboside, a naturally occurring vitamin present in cow milk.”

The only difference between at least one embodiment within the scope of the claim and natural milk is that the NR in the former is isolated. The asserted claims do not have characteristics markedly different from milk. Both the claimed compositions and milk “increase NAD+ biosynthesis upon oral administration.

The Federal Circuit noted that the claims cover several different composition embodiments, some of which are structurally different from milk. However, the claims also encompass—as both parties agree—at least one embodiment that covers milk, except that the NR element is “isolated.” Because the claims are broad enough to encompass a product of nature, it is invalid under § 101.

Chromadex argud that the claims, in fact, possess markedly different characteristics that render them patent-eligible. Chromadex bases this argument on two main points: (1) “NR is found in milk in only trace amounts,” i.e., one part per million; and (2) “what little NR is found in milk is not bioavailable” because it is bound to the lactalbumin whey protein. However, the Federal Circuit found this argument unpersuasive first because the claims do not require that the NR, specifically, increase NAD+, and milk increases NAD+ biosynthesis (albeit because it contains tryptophan rather than because of the trace amounts of NR), but that is the only therapeutic effect that the claims require. Second, the claims simply do not reflect the distinctions Chromadex relied upon: they do not require any specific quantity of isolated NR, and the district court’s construction for “isolated [NR],” which Appellants do not challenge on appeal, does not require that the NR be separated from the lactalbumin whey protein but only from “some of the other components associated with the source of [NR].”

The Federal Circuit said that the act of isolating the NR by itself, no matter how difficult or brilliant it may have been (although the specification makes clear that it was conventional), similarly does not turn an otherwise patent-ineligible product of nature into a patentable invention.

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Statute 2 Desperate Patent Owner 0

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CyWee Group Ltd. v. Google LLC, [2020-1565, 2020-1567] (February 8, 2023), the Federal Circuit affirmed the USPTO’s Director’s decision not to rehear two Final Written Decision determining that all of the challenged claims in CyWee’s patents were unpatentable.

CyWee also argued that the Board’s institution decisions and final written decisions were untimely. According to CyWee, it was not enough that the Board instituted the IPRs within the statutorily required three months of receiving CyWee’s preliminary responses. Nor was it enough that the Board issued its final written decisions within the time the statute contemplates (i.e., one year from institution, plus in this case an additional one month due to joinder). CyWee argued that not only must the Director be able to review institution decisions and final written decisions, she also must perform (or have the opportunity to perform) such a review within the statutory deadlines applicable to those decisions.

The Federal Circuit made short work of finding CyWee’s arguments “meritless,” noting that the statutory provisions setting specific deadlines for institution decisions and final written decisions say nothing of deadlines for any further Director review of those decisions. The Federal Circuit said that the Director properly delegated authority to institute proceedings to the Board, and said that if the Board makes that determination within the § 314(b) deadline and here (as it did) —the institution decision is timely, notwithstanding the possibility that the Director may later revisit that decision.

Similarly, with respect to the final written decision, Director properly delegated authority to the Board to extend the one year deadline for a Final Written Decision in the case of joinder. The Federal Circuit said that delegation to the Board of the authority to decide on institution without a mechanism for parties to subsequently request Director review does not present Appointments Clause problems.