Board Erred in Failing to Apply § 112, ¶ 6 to “Mechanical Control Assembly”

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In MTD Products Inc. v. Iancu, [2017-2292] (August 12, 2019), the Federal Circuit vacated the Board’s obviousness determination, finding that the Board erred in finding that the term “mechanical control assembly” was not a means-plus-function term governed by § 112, ¶ 6.

U.S. Patent No. 8,011,458 discloses a steering and driving system for zero turn radius (“ZTR”) vehicles. Both of the independent claims contain the phrase “mechanical control assembly.”

The “essential inquiry of whether a claim element invokes § 112, ¶ 6. is not merely the presence or absence of the word ‘means’ but whether the words of the claim are understood by persons of ordinary skill in the art to have a sufficiently definite meaning as the name for structure. One way to demonstrate that a claim limitation fails to recite sufficiently definite structure is to show that, although not employing the word “means,” the claim limitation uses a similar nonce word that can operate as a substitute for “means” in the context of § 112, para. 6.” Generic terms like “module,” “mechanism,” “element,” and “device” are commonly used as verbal con-structs that operate, like “means,” to claim a particular function rather than describe a sufficiently definite structure. Even if the claims recite a nonce term followed by functional language, other language in the claim might inform the structural character of the limitation-in-question or otherwise impart structure to the claim term.

In assessing whether the claim limitation is in means-plus-function format, we do not merely consider an introductory phrase (e.g., “mechanical control assembly”) in isolation, but look to the entire passage including functions performed by the introductory phrase. The ultimate question is whether the claim language, read in light of the specification, recites sufficiently definite structure to avoid § 112, ¶ 6.

The Federal Circuit agreed with the Board that the term “mechanical control assembly” is similar to other generic, black-box words that it has held to be nonce terms similar to “means” and subject to § 112, ¶ 6 because the term does not connote sufficiently definite structure to one of ordinary skill in the art. The Federal Circuit further agreed that the rest of the claim language of the disputed phrase is primarily, but not entirely, functional. However the Federal Circuit said that the Board erred when it relied on the specification’s description of a “ZTR control assembly” to conclude that the claim term “mechanical control assembly” had an established structural meaning. The fact that the specification discloses a structure corresponding to an asserted means-plus-function claim term does not necessarily mean that the claim term is understood by persons of ordinary skill in the art to connote a specific structure or a class of structures.

The Federal Circuit found that the Board’s analysis implied that so long as a claim term has corresponding structure in the specification, it is not a means-plus-function limitation. This view would leave § 112, ¶ 6 without any application, because any means-plus-function limitation that met the statutory requirements, i.e., which includes having corresponding structure in the specification, would end up not being a means-plus-function limitation at all.

The Federal Circuit also disagreed with the Board’s interpretation of the prosecution history, finding that arguing that a limitation connotes structure and has weight is not inconsistent with claiming in means-plus-function format since means-plus-function limitations connote structure.

Given the lack of any clear and undisputed statement foreclosing application of § 112, ¶ 6, we conclude that the Board erred in giving dispositive weight to the equivocal statements it cited in the prosecution history.

“Merely Tangential” Exception to Prosecution History Estoppel Saved “Inartful” Amendment from Barring Infringement by Equivalents

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In Eli Lilly and Co. v. Hospira, Inc., [2018-2126, 2018-2127] (August 9, 2019), the Federal Circuit reversed the district court’s finding of literal infringement in the Hospira Decision as clearly erroneous in light of the court’s claim construction of “administration of pemetrexed disodium,” but affirmed the district court’s finding of infringement under the doctrine of equivalents.

Lilly markets the compound pemetrexed in the form of a disodium salt as Alimta®, for treating certain types of non-small cell lung cancer and mesothelioma. This product was covered by U.S. Patent 7,772,209. Hospira and Dr. Reddy’s each filed ANDA applications to market competing

With respect to the finding of literal infringement, Hospira argued that it cannot literally infringe the claims of the ’209 patent because intravenous administration of pemetrexed ditromethamine dissolved in saline—a solution which contains pemetrexed and chloride anions alongside sodium and tromethamine cations—is not “administration of pemetrexed disodium.” The Federal Circuit agreed, finding that “[i]t was clearly erroneous for the district court to hold that the ‘administration of pemetrexed disodium’ step was met because Hospira’s pemetrexed ditromethamine product will be dissolved in saline before administration. A solution of pemetrexed and chloride anions and tromethamine and sodium cations can-not be deemed pemetrexed disodium simply because some assortment of the ions in the solution consists of pemetrexed and two sodium cations.” The Federal Circuit concluded that to literally practice the “administration of pemetrexed disodium” step under the district court’s claim construction, the pemetrexed disodium salt must be itself administered.

With respect to the Doctrine of Equivalaents, the main dispute was whether prosecution history estoppel prevented Lilly from claiming that the administration of pemetrexed ditromethamine was an infringing equivalent to administering pemetrexed disodium. During prosecution, Lilly amended the claims from “an antifolate” to “pemetrexed disodium.” Lilly conceded that this was a narrowing amendment, and that it was made for reasons of patentability. However, Lilly argued that the rationale of its amendment bore “no more than a tangential relation to the equivalent in question.”

Lilly argued that the district court properly held that the reason for its amendment was to distinguish pemetrexed from antifolates generally and that the different salt type is a merely tangential change with no consequence for pemetrexed’s administration or mechanism of action within the body. The Federal Circuit agreed with Lilly. Noting that “tangential” meant “touching lightly or in the most tenuous way,” the Federal Circuit said that the reason for the amendment was to distinguish methotrexate. Under these circumstances the particular type of salt to which pemetrexed is complexed relates only tenuously to the reason for the narrowing amendment, which was to avoid methotrexate . The Federal Circuit therefore held that Lilly’s amendment was merely tangential to pemetrexed ditromethamine because the prosecution history, in view of the ’209 patent itself, strongly indicates that the reason for the amendment was not to cede other, functionally identical, pemetrexed salts.

The Federal Circuit also found support in the prosecution record, noting that Lilly’s amendment, inartful though it might have been, was prudential in nature and did not need or intend to cede other pemetrexed salts. Because the references specifically mentioned pemetrexed the Federal Circuit saiad that narrowing “antifolate” to “pemetrexed disodium” could not possibly distinguish the art cited in the obviousness ground of rejection.

Lilly’s burden under Festo was to show that pemetrexed ditromethamine was “peripheral, or not directly relevant,” to its amendment, and the Federal Circuit concluded it had done so.

The Federal Circuit also rejected arguments that the disclosure-dedication rule prevented a finding of infringement under the docitrine of equivavlents, agreeing with Lilly that the ’209 patent does not disclose methods of treatment using pemetrexed ditromethamine, and, as a result, Lilly could not have dedicated such a method to the public.

Because neither prosecution history estoppel nor the disclosure-dedication rule bars Lilly from asserting infringement through equivalence, the Federal Circuit affirmed the judgement of infringement.

Infringement was a Matter of Degree

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In Cobalt Boats, LLC v. Brunswick Corp., [2018-1376] (May 30, 2019), the Federal Circuit, in a NON-PRECEDENTIAL decision, the Federal Circuit reversed district court judgment of nearly $5.4 million for willful infringement of U.S. Patent No. 8,375,880 on a swim step for boats.

The claims at issue required a step “capable of being rotated 180° between a stored position . . . and a deployed position.” It was undisputed that the accused boat step did not rotate 180°. The Federal Circuit began with the fact that while the parties disagreed on the claim construction, the court did adopted the patent owner’s position, holding that the “180 degrees” limitation should be given its “plain and ordinary meaning” and rejecting Brunswick’s proposed construction. The Federal Circuit observed that it is not appropriate to leave to the jury the task of resolving claim construction disputes.

The Federal Circuit found that the “180 degrees” limitation required that the step be capable of rotating at least 180 degrees, not merely “flipping over” as the patent owner contended. The Federal Circuit said that where a precise value is included in the claim without a term such as “about,” it interprets the claim language as imposing a strict numerical boundary, absent evidence that such a construction would be inconsistent with the intrinsic evidence. The Federal Circuit said the claim does not use “about,” which suggests that 180 degrees serves as a precise numerical boundary for the minimum rotation of the step, and the intrinsic evidence did not suggest a different construction. The Federal Circuit construed the 180 degrees limitation to require that the swim step be capable of rotating at least 180 degrees, which meant that a step that can rotate at most 179 degrees would not meet the limitation, while a step that can rotate 181 degrees would.

The Federal Circuit rejected the argument that the 180 limitation way merely a way of saying the steps flipped, noting that the claims also said that the steps flipped, so such a construction would make the 180 limitation redundant.

Based upon its construction of the 180 degree limitation, the Federal Circuit concluded that there was no literal infringement. With respect to infringement under the doctrine of equivalents, the Federal Circuit found that the claims were limited by prosecution history estoppel since the 180 degree limitation was added to obtain allowance of the claims. The Federal Circuit rejected the patent owners argument that estoppel did not apply since the limitation was added to overcome prior art that only rotated 90°, noting that the scope of disclaimer is measured by the difference between the original and the amended claims, not the difference be-tween the amended claims and the prior art that was avoided through the amendment, this is particularly true where the claims are amended to include a specific numeric boundary.

Reversing the finding of literal infringement and infringement under the doctrine of equivalents, the Federal Circuit reversed.

This case highlights the importance of having some wiggle room on numeric limitations in claims. Also the opinion is non-precedential, the Federal Circuit cited several cases illustrating the importance of Wiggle words, such as “about.” Jeneric/Pentron, Inc. v. Dillon Co., 205 F.3d 1377, 1381 (Fed. Cir. 2000); Pall Corp. v. Micron Separations, Inc., 66 F.3d 1211, 1217 (Fed. Cir. 1995);and Elekta Instrument S.A. v. O.U.R. Scientific International, Inc., 214 F.3d 1302 (Fed. Cir. 2000).

Lack of All Substantial Rights Deprived Plaintiff of Statutory Standing, But Not Article III Standing

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In Lone Star Silicon Innovations LLC. v. Nanya Technology Corporation, [2018-1581] (May 30, 2019), the Federal Circuit affirmed the district court’s determination that Lone Star did not own the patents in suit, but reversed the dismissal of the action, finding that the court should consider whether AMD, the patent owner, should have been joined.

The asserted patents were originally assigned to AMD, which later executed an agreement purporting to transfer “all right, title and interest” in the patents to Lone Star. The transfer agreement, however, imposed several limits on Lone Star, including that Lone Star agreed to only assert
the covered patents against entities specifically listed in the agreement. If Lone Star sued an unlisted entity, AMD had the right—without Lone Star’s approval—to sublicense the covered patents to the unlisted target. AMD could also prevent Lone Star from assigning the patents or allowing them to enter the public domain.

Lone Star sued entities who were listed in the transfer agreement, alleging that AMD transferred “all right, title, and interest” in the asserted patents to Lone Star. Nearly a year after filing, Lone Star finally produced the transfer agreement, which resulted in motions to dismiss, which the district court granted after concluding that Lone Star did not hold all substantial rights in the asserted patents.

The Federal Circuit agreed with the district court that, while Lone Star was given a number of rights in the transfer agreement, it was not given all substantial rights in the asserted patents. The Federal Circuit explained that the “ultimate task is not to tally the number of rights retained against those transferred.” The inquiry depends on the substance of what was granted rather than formalities or magic words.

Looking at the “totality” of the transfer agreement, the Federal Circuit focused on two salient rights: enforcement and alienation. Noting that Lone Star needed AMD consent to sue unlisted entities, and that Lone Star’s ability to transfer the patents was limited to assignees who agreed to be bound by the same terms and conditions, the Federal Circuit concluded that Lone Star did not have all substantial rights.

However the Federal Circuit found that the district court erred when it concluded that Lone Star did not have standing, noting the difference between statutory jurisdiction and subject matter jurisdiction. The Federal Circuit noted that its own precedent was at least partly responsible for this error, and pronounced it was bringing itself into accord with Lexmark and our sister circuits by concluding that whether a party possesses all substantial rights in a patent does not implicate standing or subject-matter jurisdiction. Accordingly, the Federal Circuit found that although Lone Star does not possess all substantial rights in the asserted patents its allegations still satisfy Article III.

Because it has standing, even if it lacks all substantial rights in the patents, Lone Star should be given an opportunity to join AMD as a necessary party before this case is dismissed, and the Federal Circuit agreed, finding the result compelled by FRCP 19(a)(2) (“If a person has not been joined as required, the court must order that the person be made a party”) and Federal Circuit precedent. The Federal Circuit vacated the district court’s dismissal and remanded with an instruction that it consider whether AMD must be joined here.

We Shall fight in the Fields and in the Streets, We Shall Fight in the Hills; We Shall Never Surrender.

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In Papst Licensing GmbH & Co. KG v. Samsung Electronics America, Inc., [2018-1777] (May 23, 2019), the Federal Circuit affirmed the PTAB’s determination that claims 1–38 and 43–45 of Papst’s U.S. Patent No. 9,189,437 are unpatentable for obviousness. The ‘437 patent, titled “Analog Data Generating and Processing Device Having a Multi-Use Automatic Processor” is directed to an interface device for communication between a data device (on one side of the inter-face) and a host computer (on the other).

The Federal Circuit noted that there were several other inter partes reviews and corresponding appeals relevant to this proceeding, in particular, six weeks before the Board rendered its ’437 Patent Decision, the Board rendered final written decisions in two other IPRs (requested by Samsung among other petitioners) involving two other Papst-owned patents (U.S. Patent Nos. 8,966,144 and 8,504,746) which share a specification with the ’437 patent and contain claim terms related to those involved in the the appeal. While Papst initially appealed those decisions, it later voluntarily dismissed those appeals, which had the effect of making those decisions final.

The Federal Circuit noted that it has held that issue preclusion doctrine can apply to the Patent Trial and Appeal Board’s decision in an IPR once it becomes final. While there is an exception to the preclusion doctrine where the prior matter was of disparately low value compared to the current proceeding, the Federal Circuit found that this did not apply because Papst fully litigated the prior case up to the eve or oral argument, and did not avail itself of the opportunity to simply disclaim the claims, if they were not worth fighting for.

Upon examining whether issue preclusion did in fact apply, the Federal Circuit noted that the Board’s ruling in the prior decision was not just materially identical to the Board’s claim construction ruling in the present case, it was essential to that determination. The Federal Circuit thus concluded that issue preclusion therefore applies to the only two issues properly preserved for and presented on appeal, and affirmed the Board’s decision on that basis.

The Federal Circuit gratuitously continued, however, to confirm that Papst’s would have failed on the merits, even apart from issue preclusion, finding substantial evidence supported the Board’s decision.

The clear lesson taught the Federal Circuit is that when dealing with multiple post grant proceedings on related patents — or at least patents with related claim elements — the parties must consider how the timing and manner of dropping portions of the proceedings might create issue preclusion. Winston Churchill once famously said:

We shall defend our island, whatever the cost may be, we shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and in the streets, we shall fight in the hills; we shall never surrender.

So, too, in patent disputes, sometimes, surrender is not an option.

Detailed Explanation and Corroboration Made “Sham Affidavit” Doctrine Inapplicable

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In Quest Integrity USA, LLC v. Cokebusters USA Inc., [2017-2423] (May 21, 2019), the Federal Circuit affirmed the judgment of invalidity as to claims 12, 24, and 33, of U.S. Patent No. 7,542,874 under the on sale bar of 102(b), reverse the judgment of invalidity as to claims 30 and 40, and remanded for further proceedings.

Cokebusters defended on the ground that the claims were invalid under 35 U.S.C. § 102(b) because there was a commercial sale of services that used the claimed methods, computer-readable media, and system more than one year before June 1, 2004, the date the application that led to the ’874 patent was filed in the United States. The basis for the on-sale bar defense was an offer by Quest itself to provide furnace tube inspection services to a client in the petrochemical industry. The district court agreed, and granted summary judgment of invalidity of claims 12, 24, and 33, and after discounting affidavits by Quest as “sham affidavits” also granted summary judgment as to claims 30 and 40.

The Federal Circuit noted that the parties agreed that the Norco Sale was “a commercial offer for sale” under § 102(b), and said that the fact that Quest did not sell its hardware or software (i.e., its method, computer-readable medium, or system) does not take Quest’s commercial activities outside the on-sale bar rule. Rather, Quest used its method, computer-readable medium, and system commercially to perform furnace inspection services and produce the Norco Reports for its customer. Sale of a product produced by performing a claimed process implicates the on sale bar. The same approach necessarily applies where a service is performed for compensation using a claimed computer-readable medium or system that generates a “product.” After concluding that all of the limitations in the claims were in fact met by the pre-critical date commercial activity, the Federal Circuit affirmed summary judgment with respect to claims
12, 24, and 33.

However as to claims 30 and 40, there was an additional limitation that the district court relied upon the testimony of a co-inventor to find was also present in the pre-critical date commercial activities. However Quest argued that there was a genuine issue of material fact that precluded summary judgment because there was also contrary evidence in the form of declarations by the same inventor, and a co-inventor contradicting the earlier deposition testimony, and explaining why the inventor Lorenzo had made an error. The district court rejected Quest’s arguments, concluding that the declarations were “sham affidavits” because they contradicted the earlier deposition testimony.

The Federal Circuit concluded that the declarations of cannot be dismissed as sham affidavits. First, the second co-inventor’s declaration did not contradict any earlier testimony that he gave. The general rule is that the sham affidavit doctrine allows a court to disregard an offsetting affidavit that is submitted in opposition to a motion for summary judgment when the affidavit contradicts the affiant’s prior deposition testimony, not another witness’s prior deposition testimony. The Federal Circuit also determined that it was error to disregard the first co-inventor’s declaration because it offered a detailed declaration in which he provided a “plausible explanation” why his deposition testimony was incorrect. (The co-inventor was shown only a portion of the source code that did not contain dated comments from after the critical date, indicating that the version he testified about was not in use prior to the critical date, and further the displays were inconsistent with the use of the code he was shown.).

The Federal Circuit said that the detailed explanation in the declaration and corroborating evidence took the declaration out of the sham affidavit doctrine. The Federal Circuit reversed summary judgment as to claims 30 and 40, and remanded.

The Written Description Must Provide More than A Mere Wish or Hope that the Invention Would Work

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In Nuvo Pharmaceuticals v. Dr. Reddy’s Laboratories Inc., [2017-2473, 2017-2481, 2017-2484, 2017-2486, 2017-2489, 2017-2491, 2017-2492, 2017-2493] (May 15, 2019), the Federal Circuit reversed the district court’s judgment that the asserted claims of U.S. Patent Nos. 6,926,907 and 8,557,285 were non-obvious, and adequately enabled and described.

Nuvo’s expert identified portions of the specification the he claimed supported the claims, but the Federal Circuit disagreed, noting that it has expressly rejected the “argument that the written description requirement is necessarily met as a matter of law because the claim language appears in ipsis verbis in the specification. the appearance of words in a specification or a claim, even an original claim, does not necessarily satisfy §112 because it may not both put others on notice of the scope of the claimed invention and demonstrate possession of that invention.

The Federal Circuit noted that experimental data demonstrating effectiveness is not required. Patent applications claiming new methods of treatment are usually supported by test results, but it is clear that testing need not be conducted by the inventor. The Federal Circuit also noted that a theory or explanation of how or why a claimed composition will be effective is also not required. Nor does the invention actually have to be reduced to practice. Nevertheless, the Federal Circuit found that the record evidence demonstrates that a person of ordinary skill in the art would not have known or understood the claimed invention.

The Federal Circuit said that in light of the fact that the specification provides nothing more than the mere claim that the invention might work, even though persons of ordinary skill in the art would not have thought it would work, the specification is fatally flawed. It does not demonstrate that the inventor possessed more than a mere wish or hope that the invention would work, and thus it does not demonstrate that he actually invented what he claimed.

The Federal Circuit said that teaching how to make and use an invention does not necessarily satisfy the written description requirement. The enablement requirement, which requires the specification to teach those skilled in the art how to make and use the claimed invention without undue experimentation, is separate and distinct from the written description requirement, which focuses on whether the specification notifies the public about the boundaries and scope of the claimed invention and shows that the inventor possessed all the aspects of the claimed invention.

The Federal Circuit concluded that the patent did not meet the written description requirement, and did not reach the question of enablement, or the patent owners appeal of summary judgment of non-infringement.

Patent’s Description Was Inconsistent with Patentee’s Claim Construction

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In BTG International Limited v. Amneal Pharmaceuticals LLC, [2019-1147, 2019-1148, 2019-1323, 2019-1324, 2019-1325] (May 14, 2019), in consolidated appeals from the District of New Jersey and the PTAB involving U.S. Patent No. 8,822,438, the Federal Circuit affirmed the PTAB’s Final Written Decision in one one of the IPRs, mooting the other appeals.

The ‘438 Patent is directed to methods and compositions for treating cancer. Appellants asserted that the PTAB erred by improperly construing the term “treatment” by not requiring prednisone to have an anti-cancer effect, and then relying on that incorrect construction to find that the asserted claims would have been obvious.

The Federal Circuit agreed with the PTAB’s construction, noting that the claims, specification, and prosecution history teach that treatment includes both anti-cancer effects and palliation or reduction in side effects. The claim required “a therapeutically effective amount,” which was defined in the specification as an amount “effective for treating a disease or disorder . . . such as cancer.” The specification further stated that a “therapeutic agent” may be either “an anti-cancer agent or a steroid.” The Federal Circuit pointed out that the use of “or” in between “anti-cancer agent” and “steroid” suggests that a steroid is not necessarily the same thing as an anti-cancer agent. The Federal Circuit added that if the patentee intended to limit “treating” and “therapeutic agents” to anti-cancer agents, the patentee neither would have identified steroids separately as an agent for reducing adverse side effects, nor described prednisone repeatedly in the specification as a steroid without mentioning any anti-cancer effect.

The Federal Circuit found that the PTAB correctly concluded that the Asserted Claims cover a therapy in which abiraterone has an anticancer effect, while prednisone either has its own anti-cancer effect or has a palliative/side-effect reduction effect.

Based upon this construction, the Federal Circuit found substantial evidence supported the PTAB’s determination of obviousness.

Because the specification is the single best guide to the meaning of claim terms, it is important that the use of the terms in the specification be consistent with the claim construction the patent owner wants.

Lack of Reasonable Expectation of Success Meant Claims Weren’t Obvious

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In Novartis Pharmaceuticals Corp. v. West-Ward Pharmaceuticals Int’l Ltd., [2018-1434] (May 13, 2019), the Federal Circuit affirmed the district court’s determination that claims 1–3 of U.S. Patent No. 8,410,131 for treating treat advanced renal cell carcinoma would not have been obvious in view of the prior art.

The Federal Circuit held that the district court erred in finding no motivation to combine the prior art references, but found no clear error in the district court’s finding that a person of ordinary skill would not have reasonably expected success, and thus agreed with the district court’s ultimate determination that the challenged claims would not have been obvious.

As to motivation to combine, the Federal Circuit noted that its case law does not require that a particular combination must be the preferred, or the most desirable, combination described in the prior art in order to provide motivation for the current invention. Thus it was improper to have required defendants to prove that a person of ordinary skill would have selected the claimed compound over the other prior art treatment methods in the reference.

However on the issue of reasonable expectation of success, the Federal Circuit agreed with the district court. In particular the district court relied upon on the prior art and expert testimony to support subsidiary findings that (1) the phase I data for a related compound had diminished weight, (2) the claimed compound had different pharmacological properties than the prior art compound, and (3) the molecular biology of advanced RCC was not completely understood. The Federal Circuit affirm the district court’s conclusion that claims 1–3 of the ’131 patent would not have been obvious in view of the asserted prior art