The PTAB Cannot Approve or Deny Certificates of Correction

In Honeywell International, Inc. v. Arkema Inc., Arkema France, Appeal Nos. 2018-1151, -1153, the Patent Trial and Appeal Board (“Board”) does not have the authority to determine when a Certificate of Correction is appropriate.

Arkema Inc. (“Arkema”) filed two petitions for post-grant review (“PGR”) of a patent recently issued to Honeywell International, Inc. (“Honeywell”). The petitions asserted that the priority applications listed on the patent did not provide written description support for the issued claims, and thus, Arkema argued that the patent was entitled to a later priority date, not the earlier priority date that would result if the priority chain supported the claims. The Board instituted the PGR proceedings. Honeywell claimed to have not realized that the lack of support stemmed from a mistake in the priority chain until it was preparing its Patent Owner Responses. Once Honeywell discovered the priority chain mistake, it requested permission to move for leave to request a Certificate of Correction from the Director of the PTO, to amend the priority chain. The Board rejected Honeywell’s request for leave, holding that the requirements for receiving a Certificate of Correction (35 USC § 255) were not met. Honeywell appealed the Board’s decision to the Federal Circuit.

The Federal Circuit concluded that the Board abused its discretion by assuming the authority delegated to the Director to determine when a Certificate of Correction is appropriate. While the Board is permitted to determine whether there is a sufficient basis to support the patent owner’s position that a mistake may be corrected, in the instant case, the Federal Circuit found that the Board had overstepped its authority by requiring Honeywell to “show the requirements of § 255 ha[d] been met” before granting leave to file the motion for the Board to cede its exclusive jurisdiction. Ultimately, the Federal Circuit vacated the Board’s final written decision and remanded the case to the Board, instructing them to authorize Honeywell to move to seek leave to petition the Director for a Certificate of Correction.

Result-Oriented Claims Based on Natural Laws Held Invalid Under § 101

In American Axle & Manufacturing, Inc. v. Neapco Holdings Llc, Appeal No. 2018-1763, mechanical method claims involving tuning automotive propshafts to dampen vibrations were directed to natural laws and patent ineligible under § 101.

American Axle & Manufacturing (“AAM”) sued Neapco for patent infringement. The patent covered methods of manufacturing driveline propeller shafts (“propshafts”) to dampen multiple types of vibration. For example, a representative independent claim required tuning a mass and stiffness of a propshaft liner to dampen both “shell mode” and “bending mode” vibrations. The parties filed cross-motions for summary judgment on the eligibility of the asserted claims under 35 U.S.C. § 101. The district court granted summary judgment of ineligibility, finding the claims directed to Hooke’s law and friction damping principles—laws of nature. AAM appealed.

The Federal Circuit agreed that the challenged claims were ineligible. Under Mayo/Alice step 1, AAM argued that tuning a liner to achieve the claimed vibration dampening was too complex to be adequately described by Hooke’s law. AAM also argued that liners had not previously been used to dampen bending mode vibrations. The Federal Circuit found that the claims recited desired results but not the specific tuning process used to achieve those results. Because the claims required no more than applying Hooke’s law (and possibly other natural laws) by trial and error to achieve the desired results, the Federal Circuit found the claims directed to a patent ineligible natural law. Turning to Mayo/Alice step 2, the Federal Circuit found that AAM’s alleged inventive concepts amounted to nothing significantly more than the desired results addressed at step 1. Even if those desired results were “new and unconventional,” the claims recited no specific way of achieving them other than “a conventional, unbounded trial-and-error process.” Thus, the Federal Circuit affirmed.

Judge Moore dissented, stating that she was “deeply troubled by the majority’s disregard for the second part of the Alice/Mayo test, its fact finding on appeal and its repeated misrepresentation of the record.”

“Consisting Essentially Of” and Indefiniteness

In Hznp Medicines Llc, Horizon Pharma Usa, Inc. v. Actavis Laboratories Ut, Inc., Appeal Nos. 2017-2149, -2152, -2153, -2202, -2203, -2206, claims using “consisting essentially of” were indefinite because the basic and novel properties of the invention were indefinite under Nautilus.

HZNP Medicines LLC and Horizon Pharma USA, Inc. (“Horizon”) had rights to multiple patents related to treatment of osteoarthritis with diclofenac. Actavis Laboratories UT, Inc. (“Actavis”) filed a Paragraph IV certification as part of an ANDA to market a generic version of Horizon’s PENNSAID 2% product, and Horizon filed an infringement suit. The district court found three terms in the patents indefinite, found no induced infringement in Actavis’s labelling, and entered summary judgment of invalidity and noninfringement for Actavis. One claim in the ’913 patent remained for trial, to which Actavis stipulated infringement if the claim was found nonobvious. The district court found that Actavis had not carried its burden to show obviousness and enjoined Actavis from use or sale of its ANDA product until the ’913 patent expired. Horizon appealed the indefiniteness determinations, while Actavis cross-appealed the finding of nonobviousness.

The district court found that a claim term discussing “impurity A” was indefinite, though Horizon argued a POSITA would know it was USP Diclofenac Related Compound A RS through knowledge of pharmacopeias. The Federal Circuit affirmed the district court’s rejection of that argument because the specification did not contain information that would tie “impurity A” to Compound A, such as the isolation procedures used. Because Horizon’s proposed construction of a second disputed phrase incorporated and relied upon “impurity A,” the Federal Circuit affirmed the district court’s holding this phrase must be indefinite as well.

The district court further found that various claims reciting formulations “consisting essentially of” various ingredients were indefinite. The Federal Circuit noted that “consisting essentially of” requires the listed components, but permits inclusion of additional non-listed components that do not materially affect the basic and novel properties of the invention. The Federal Circuit affirmed the district court’s determination that the Nautilus definiteness standard applied, in this case, to evaluating whether these basic and novel properties of the invention were definite.

The Federal Circuit then affirmed the district court’s finding that “better drying time,” one of the alleged basic and novel properties, was indefinite. The specification described both qualitative and quantitative tests for determining drying time, but the inventive embodiments did not consistently display better drying times at each measured time period. The Federal Circuit affirmed the district court’s holding that because this basic and novel property of the invention was indefinite, the “consisting essentially of” phrases were therefore indefinite.

The Federal Circuit also affirmed the district court’s holding that Actavis’s ANDA product labelling did not induce infringement, finding that the label permitted, but did not require all the steps claimed in Horizon’s method of use patents. Specifically, the claims required (1) applying the claimed product, (2) waiting for it to dry, and (3) applying a second product like sunscreen, insect repellant, or another medicated product. Actavis’s labelling merely instructed users to wait until the product was dry before doing anything like apply sunscreen, insect repellant, or cover with clothing.

The Federal Circuit rejected Actavis’s cross-appeal that challenged the district court’s holding that the claims were not obvious. The pharmaceutical components interacted in unpredictable and unexpected ways, precluding a conclusion that the 2% formulation was created through routine optimization.

Routine Experimentation Can Be “Undue Experimentation”

In Idenix Pharmaceuticals Llc V. Gilead Sciences Inc., Appeal No. 2018-1691, synthesizing and screening tens of thousands of compounds to identify those within the scope of the claims was found to be undue experimentation.

Idenix Pharmaceuticals and Universita Degli Studi Di Cagliari (collectively, “Idenix”) sued Gilead Sciences, Inc. for patent infringement, alleging that Gilead’s sofosbuvir drug product infringes Idenix’s patent claims directed to methods of treating hepatitis C virus (HCV). At the district court, Gilead argued that the claims are invalid under § 112 for failure to meet the written description and enablement requirements. The jury upheld the validity of the patent, and Gilead moved for JMOL on both grounds, which the district court granted only with respect to enablement.

In a split opinion, the Federal Circuit affirmed the invalidity of the claims for lack of enablement and reversed the district court’s denial of JMOL for lack of written description. Under the district court’s claim construction, the patent covers methods of administering nucleoside compounds with a particular structure (a methyl group at the 2' up position) and function (efficacy in treating HCV). The majority concluded that the claims are invalid for lack of enablement because at least tens of thousands, and possibly billions, of compounds meet the structural limitation, but a skilled artisan would not be able to identify the small subset that are also effective to treat HCV without synthesizing and screening each compound. The majority emphasized that, even accepting Idenix’s contention that synthesis and screening were routine, the degree of experimentation required to practice the full scope of the invention rendered the claims invalid.

The majority also held that the claims are invalid for lack of written description support. The specification discloses four examples of compounds with demonstrated efficacy against HCV and lists other potentially effective compounds. The majority concluded that this disclosure is not sufficient because the specification provides no meaningful guidance for identifying undisclosed compounds that meet the claim limitations. The majority placed significant emphasis on the fact that the compound in Gilead’s accused product is not included among the thousands of disclosed compounds.