AMGEN INC. et al. v. APOTEX INC. et al. 827 F. 3d 1052 (Fed. Cir. 2016) Notice Requirements for Biosimilar Applicants under the Biologics Price Competition and Innovation Act

May 21st, 2017 by Thomas J Germinario

I. STATUTORY BACKGROUND 

The Biologics Price Competition and Innovation Act of 2009 (the “BPCIA”, 42 U.S.C. §262) authorizes a generic drug manufacturer to gain FDA approval for a product sufficiently similar to a previously licensed “reference product” by demonstrating, among other things, that its product is “biosimilar” to the reference product. The statute provides that the biosimilar product application may not be submitted until four years after the reference product was first licensed, and that the biosimilar product license may not become effective until twelve years after the reference product’s licensing date.

Subsection 262(l) of the BPCIA sets forth a detailed procedure for resolving potential patent infringement issues before the biosimilar generic product is commercially marketed. Under paragraph (2)(A), within 20 days after the FDA notifies the biosimilar applicant that its application has been accepted for review, the applicant can give notice to the reference product sponsor, initiating a series of informational exchanges designed to narrow the scope of potential infringement litigation.

While these procedures relieve the biosimilar applicant of defending numerous infringement claims prior to getting its FDA license, they can also defer resolution of some claims until after licensure. Congress recognized that certain infringement issues may not become ripe for adjudication until after FDA approval, when the biosimilar product, its therapeutic uses, and its manufacturing processes become fixed. Therefore, it provided in paragraph (8)(A) of the BPCIA that the biosimilar applicant shall provide notice to the reference product sponsor not later than 180 days prior to the first commercial marketing of the FDA-licensed biosimilar product. This 180 day window affords time to the reference product sponsor to consider the need for further infringement claims not yet resolved by the (2)(A) process, and it also gives the courts time to review such claims without the pressure of imminent marketing of the generic product.

 II. AMGEN v. SANDOZ

In Amgen Inc. v. Sandoz Inc, 794 F.3d 1347 (Fed. Cir. 2015), the Federal Circuit had held that the commercial-marketing provision of paragraph 8(A) is mandatory, with the 180-day period beginning only upon post-licensure notice, and that an injunction was proper to enforce the provision against Sandoz, a biosimilar-product applicant that had entirely skipped the paragraph (2)(A) statutory process of information exchange and patent litigation channeling.

The court held that the (8)(A) notice must be given after FDA licensure of the biosimilar product, and that pre-licensure notices are of no legal effect for purposes of (8)(A). It explained that the statutory 180- day period runs from licensure, “at which time the product, its therapeutic uses, and its manufacturing processes are fixed” by licensure. Id. at 1358. The purpose, the court explained, is to “provide a defined statutory window during which the court and the parties can fairly assess the parties’ rights prior to the launch of the biosimilar product,” the alternative being rushed decision-making about requesting or issuing a preliminary injunction. Id. at 1360.

The court concluded that (8)(A) is “mandatory”: “A question exists . . . concerning whether the ‘shall’ provision in [(8)(A)] is mandatory. We conclude that it is.” Id. at 1359. The court added that (8)(A) is “a standalone notice provision,” not dependent on the earlier information-exchange provisions. Id. at 1359–60. The biosimilar applicant Sandoz had not provided notice of FDA review under (2)(A).

III. AMGEN v. APOTEX in District Court

In October 2014, Apotex filed a biologics license application with the FDA under the BPCIA and listed Amgen’s Neulasta® as the reference product. In December 2014, the FDA accepted Apotex’s application for review, and Apotex notified Amgen of the application in accordance with (2)(A), thereby initiating the statutory patent litigation channeling procedure. In April 2015, Apotex sent a letter to Amgen purporting to serve as notice of future commercial marketing of its generic product pursuant to (8)(A), although it lacked an FDA license at that time.

Amgen filed a motion in October 2015 asking the District Court to issue a preliminary injunction that would require Apotex to provide an (8)(A) notice if and when it receives a license and to delay any commercial marketing for 180 days from that notice. The parties stipulated that Amgen would be irreparably harmed if Apotex entered the market without giving the requested 180 days’ notice, the balance of the hardships favored Amgen, and the public interest favored the issuance of an injunction. The decision whether to grant the preliminary injunction motion, therefore, turned on Amgen’s likelihood of success on the legal question presented: whether the (8)(A) notice requirement is a mandatory and enforceable by injunction as to a biosimilar applicant (Apotex in this case) that, unlike Sandoz in Amgen v. Sandoz, gave the (2)(A) notice to launch the infringement information-exchange process.

The District Court granted a preliminary injunction, noting that “[t]he [BPCIA] is intended to provide an orderly process for evaluating patent claims in the context of biosimilar products.” J.A. 6. In particular, the (8)(A) notice-of-commercial-marketing requirement “‘provides a defined statutory window during which the court and the parties can fairly assess the parties’ rights prior to the launch of the biosimilar product.’” Id. (quoting Amgen v. Sandoz, 794 F.3d at 1358). The court concluded: “That defined statutory window exists for all biosimilar products that obtain FDA licenses, regardless of whether the [biosimilar] applicant complies with § 262(l)(2) [paragraph (2)(A)].” Id. The court disagreed with Apotex’s contention that this conclusion should be rejected in order to avoid adding 180 days to the BPCIA’s 12-year exclusivity period for reference product sponsors. J.A. 7. The court also disagreed with Apotex’s contention that paragraph (9) establishes, as the exclusive remedy for failure to provide the (8)(A) notice of commercial marketing, a declaratory judgment on the patent-law merits of the patents at issue, regardless how rushed the litigation of those issues might be without the 180 days’ notice. Id.

IV. AMGEN v. APOTEX in the Federal Circuit

On appeal, the Federal Circuit agreed with the District Court that the fact that Apotex gave a (2)(A) notice was not a legally material distinction between its situation and that of Sandoz in Amgen v. Sandoz. The (8)(A) requirement of 180 days’ post-licensure notice before commercial marketing, the Court concluded, is a mandatory one enforceable by injunction, whether or not a (2)(A) notice was given.

The Court noted that paragraph (8)(A) provides that “[t]he subsection (k) [biosimilar] applicant shall provide notice to the reference product sponsor not later than 180 days before the date of the first commercial marketing of the biological product licensed under subsection (k).” § 262(l)(8)(A) (emphasis added). They observed that the word “shall” generally indicates that the directive is mandatory, and that they had ruled in Amgen v. Sandoz that this language is, indeed, “mandatory,” and that the scope of their earlier ruling was not restricted to circumstances when no (2)(A)-notice is given by the biosimilar applicant. 827 F.3d at 1061.

The Federal Circuit held that Amgen v. Sandoz likewise disposed of Apotex’s argument that giving (8)(A) its plain meaning would effectively extend, by six months, the 12-year exclusivity period given to a reference product sponsor by the BPCIA. They noted that the statute by its terms establishes the 12-year date only as an earliest date on which a biosimilar license can take effect. The Court reasoned that, even when market entry is delayed under (8)(A) by a total of 12 years plus 180 days after the reference product’s licensure, the result is consistent with the BPCIA.

Moreover, they noted, it’s implicit in the BPCIA that any such delay beyond 12 years should occur less frequently as time goes by. Although there would be some exclusivity periods beyond 12 years in the early years of the BPCIA, because biosimilars are still being introduced for reference products licensed before the Act was adopted in 2010, as time passes, an increasing percentage of the reference products will be licensed after 2010. For these more recent products, a biosimilar product applicant, entitled to file an application four years after licensure of the reference product, can seek approval long before the 12-year exclusivity period ends. In such circumstances, the Court found no reason that the FDA could not issue a license before the end of the exclusivity period and deem the license to take effect on the 12-year date—a possibility suggested by the BPCIA’s reference to when the FDA approval may “be made effective.” They read (8)(A) as allowing the 180-day notice of commercial marketing to be sent as soon as the license issues, even if it is not yet effective, because it is at the time of the license that “the product, its therapeutic uses, and its manufacturing processes are fixed.”

The Court further noted that the evident purpose of (8)(A) covers applicants that file (2)(A) notices as well as those that do not. As they had explained in Amgen v. Sandoz, the purpose is to ensure that, starting from when the applicant’s product, uses, and processes are fixed by the FDA license, the necessary decision-making regarding further patent litigation is not conducted under time pressure that will impair its fairness and accuracy. At a minimum, the reference product sponsor needs time to make a decision about seeking relief based on yet-to-be-litigated patents, and a district court needs time for parties to prepare for complex litigation. The 180-day period gives the reference product sponsor time to assess its infringement position for the final FDA-approved product as related to yet-to-be-litigated patents. And if further infringement litigation ensues, the 180-day window affords the parties and the district court the time for adjudicating such matters without the rush attending requests for emergent relief against immediate market entry. The Court noted that “the Act’s legislative history confirms the aim to avoid the uncertainties and deficiencies associated with a process in which requests for temporary restraining orders and preliminary injunctions are presented and adjudicated on short notice.” Id. at 1061-1063

The Court then proceeded to reject Apotex’s final argument that the BPCIA makes a declaratory judgment action the exclusive remedy for violation of (8)(A). Apotex argued that the only remedy for an applicant’s failure to give the reference product sponsor the 180-day period for post-licensure litigation decision-making is a declaratory-judgment action on a patent—which the Act permits if the applicant fails to complete any one of the BPCIA’s several procedural steps. The Court found that such exclusivity does not appear explicitly in the Act, nor can it be logically inferred from the purpose of the (8)(A) notice provision. In particular, they noted, relegating a reference product sponsor to a patent-merits declaratory-judgment action would introduce the very problem of rushed decision-making as to the patent merits that it is (8)(A)’s purpose to avoid. Id. at 1063-1065

Noncompliance with (8)(A) can occur by the biosimilar applicant either entering the market without giving a post-licensure notice or giving a notice and then entering the market before 180 days have passed. In either event, a reference product sponsor is not likely to know that the applicant will fail to provide the actual 180-day commercial-marketing notice required by (8)(A) until the applicant begins commercial marketing or declares its intention to begin such marketing imminently.

“The reference product sponsor will have to race to court for immediate relief to avoid irreparable harm from market entry, and the parties and the court, in dealing with a request for a temporary restraining order or a preliminary injunction, will engage in precisely the hurried motion practice that (8)(A) is designed to replace by ensuring a defined amount of time for pre-launch litigation.” Id. at 1065

The Court therefore concluded that “declaratory judgment as a remedy is so gross a mismatch for the (8)(A) right that it cannot fairly be treated, in the absence of any statutory language so stating, as the exclusive remedy for (8)(A)’s violation.” Id.

The Federal Circuit rejected Apotex’s exclusivity inference, because it would implicitly render (8)(A) neither mandatory nor standalone and would engender the very problems of rushed litigation that (8)(A) was enacted to avoid. They held that any inference that Congress rendered unavailable direct injunctive enforcement of (8)(A)’s plain terms is unwarranted.

In conclusion the Court held that a biosimilar applicant must provide a reference product sponsor with 180 days’ post-licensure notice before commercial marketing begins, regardless of whether the applicant provided the (2)(A) notice of FDA review. Id. at 1066

V. CONCLUSION

As the Federal Circuit observed, the type of problem faced by Apotex in this case will diminish with time, as newer reference products gain FDA approval after the 2010 adoption of the BPCIA, given the 8-year period between when the biosimilar product sponsor can apply for FDA approval and when the reference product’s exclusivity period expires. In the meantime, however, biosimilar applicants under the BPCIA are well advised to follow the Court’s suggestion by seeking early issuance of an FDA license to take effect on the 12-year date, since the Act pegs the beginning of the (8)(A) 180-day notice period to the date of issuance of an FDA license issuance rather than its effective date.

Failure to Satisfy Section 112: H-W Technology, L.C. v. Overstock.com, Section 112 Invalidity Of The ‘955 Patent Claims and Practice Takeaways (Parts 4 and 5)

April 10th, 2015 by Thomas J Germinario

Section 112 Invalidity Of The ‘955 Patent Claims

A. Claim 9

Claim 9 of the ‘955 patent as approved by the PTO for issuance, reads as follows:

A method for performing contextual searches on an Internet Phone (IP) phone comprising the steps of:

  • receiving a command to perform a contextual search;
  • receiving search criteria from a user of said IP phone;
  • submitting said search criteria to a server coupled to said IP phone; and
  • receiving from said server a list of merchants matching said search criteria and information regarding each of said merchants in said list;
  • wherein said user completes a transaction with at least one of said merchants listed without the need to generate a voice call;
  • wherein said information received by said user comprises a variety of offers, wherein said user selected one of said variety of offers associated with said one of said merchants listed, wherein said selected offer is transmitted to said one of said merchants listed electronically;
  • and wherein said user’s contact and payment information is not transmitted to said one of said merchants listed, wherein said user’s contact and payment information is available to said one of said merchants listed. (emphasis added)

However, as issued, Claim 9 omitted the method step set out in boldface type. Claim 9, uncorrected, fails to delineate the no-call feature as intended by Plaintiff and approved by the PTO. Therefore, the District Court reasoned, Claim 9 does not “adequately perform [its] function of notifying the public of the patentee’s right to exclude,” citing Solomon v. Kimberly-Clark Corp., 216 F.3d 1372, 1379 (Fed. Cir. 2000)); and Allen Engineering Corp. v. Bartell Industries, Inc., 299 F.3d 1336, 1349 (Fed. Cir. 2002) (holding that when the plain language of the claims are inconsistent with the specification, the claims are invalid for not properly claiming what the inventor regards as his invention).

Read the rest of this entry »

Failure to Satisfy Section 112: H-W Technology, L.C. v. Overstock.com, Procedural Background and Indefiniteness Under Section 112 (Parts 2 and 3)

April 10th, 2015 by Thomas J Germinario

Procedural Background

We’re talking about H-W Technology, L.C. v. Overstock.com., Inc., 111 USPQ 2nd 1727 (Fed. Cir. July 11, 2014). Plaintiff H-W Technology (“H-W”) appealed from an order of the U.S. District Court for the Northern District of Texas granting summary judgment in favor of Defendant Overstock.com (“Overstock”). In its appeal, H-W challenged the District Court’s holding that claims 9 and 17 of its U.S. Patent No. 7,525,955 (“’955 patent”) are indefinite and therefore invalid under Section 112.

The ‘955 patent is directed to an app that enables a smartphone to receive offers from merchants and to complete transactions without having to generate a voice call. It contains 24 patent claims, consisting of three independent claims (Claims 1, 9, and 17) and 21 dependent claims.

In March 2012, Plaintiff filed this patent infringement action, and Defendant filed a counterclaim seeking a declaration that the ‘955 patent is invalid and unenforceable. In October 2012, Overstock notified H-W that claim 9, as issued, was missing a limitation. H-W obtained a certificate of correction from the PTO in May 2013 and subsequently submitted it to the District Court. In the meantime, the parties had completed their summary judgment and claim construction briefing. A few months later, the District Court construed the claims and granted summary judgment of invalidity, holding that claims 9 and 17 are indefinite. H-W Tech., LC v. Overstock.com. Inc., 973 F. Supp. 2d 689, 690 (N.D. Tex. 2013).

Indefiniteness Under Section 112

Under Section 112, paragraph 2 of the Patent Act, a claim must “particularly point out and distinctly claim the subject matter which the applicant regards as his invention,” or else, it’s indefinite and invalid. Halliburton Energy Servs., Inc. v. M-I LLC, 514 F.3d 1244, 1249 (Fed. Cir. 2008). The definiteness requirement of Section 112, paragraph 2 is intended to ensure that the claims “provide clear warning to others as to what constitutes infringement of the patent” Chisum on Patents, § 8.03, at 8-14 (2000).

A claim is presumed valid and is therefore only indefinite if it is “insolubly ambiguous, and no narrowing construction can properly be adopted.” Exxon Research & Eng’g v. U.S., 265 F.3d 1371, 1375 (Fed. Cir. 2001). Whether a claim is indefinite and therefore invalid is a question of law for the court. Amtel Corp. v. Info Storage Devices, Inc., 198 F.3d 1374, 1378 (Fed. Cir. 1999). However, “[t]o the extent there are any factual findings upon which a trial court’s indefiniteness conclusion depends, they must be proven by the challenger by clear and convincing evidence.” Technology Licensing Corp. v. Videotek, Inc., 545 F.3d 1316, 1338 (Fed. Cir. 2008).

A. Correction of Errors in Claims

“It is not [a court’s] function to rewrite claims to preserve their validity.” Allen Engineering, Corp., 299 F.3d 1336, 1349. While courts cannot “rewrite claims to correct material errors”, Energizer Holdings, Inc. v. Int’l Trade Comm’n, 435 F.3d 1366, 1370 (Fed. Cir. 2006), they do have the authority to correct “obvious minor typographical and clerical errors in patents.” Novo Indus., L.P. v. Micro Molds Corp., 350 F.3d 1348, 1357 (Fed. Cir. 2003). An error is correctable by a district court only where “the error is evident from the face of the patent.” Novo Indus., L.P., 350 F.3d at 1357. Even then, “[a] district court can correct a patent only if (1) the correction is not subject to reasonable debate based on consideration of the claim language and the specification and (2) the prosecution history does not suggest a different interpretation of the claims.” Id.

B. The Effect of a Certificate of Correction

Certificates of correction are governed by 35 U.S.C. § 254, which states:

Whenever a mistake in a patent, incurred through the fault of the Patent and Trademark Office, is clearly disclosed by the records of the Office, the Director may issue a certificate of correction… Every such patent, together with such certificate, shall have the same effect and operation in law on the trial of actions for causes thereafter arising as if the same had been originally issued in such corrected form. (Emphasis added)

Based on the plain language of the statute, Federal Circuit has specifically held that “the certificate of correction is only effective for causes of action arising after it was issued.” Sw. Software, Inc. v. Harlequin Inc., 226 F.3d 1280, 1294–95 (Fed. Cir. 2000).

Failure to Satisfy Section 112: H-W Technology, L.C. v. Overstock.com, Introduction (Part 1)

April 10th, 2015 by Thomas J Germinario

Section 112 rejections are the bane of patent practitioners. We’re more comfortable, though by no means happy, with Section 102 and 103 rejections, because those involve judgment calls and interpretations, against which we can always make our counter-arguments. But a finding of failure to satisfy Section 112 amounts to an admonition that something essential is missing from our application – indeed, the most essential element – the disclosure of the invention itself.

Section 112 deficiencies are difficult enough to deal with when the fault is our own. But, as a reminder that things could always be worse, consider the following scenario. Your claims as written do satisfy Section 112, your patent is issued, and sometime later you file an enforcement action against an infringer. After a few months, your adversary informs you that one of the claims you are asserting against his client was misprinted by the Patent Office in issuing the patent, and that the misprint deleted a material claim limitation. That means your claim is invalid and unenforceable, your adversary argues.

Basic notions of fairness and equity would lead you to believe initially that your client should not be penalized for something that was totally not its fault or yours. After all, in this case the absence of the deleted language was not obvious from reading the claims, and the trial court should surely recognize the error and correct it. But the trial court, citing valid precedent, holds that it’s precisely the non-evident nature of the error that precludes judicial correction of the claim. It’s just one of those situations in which strict adherence to the logic of the law leads to an illogical outcome. So it turns out that the less likely it would have been for you to detect the printing error upon reviewing the issued patent, the more likely you will be denied relief to correct the error.

Nevertheless, you remain undaunted in the face of this bizarre turn of events and petition the Patent Office to issue a certificate of correction, which you duly submit to the court. But the court ignores it, ruling that your restored claim can only be asserted in a cause of action arising after the certificate was issued, and hence it has no effect in your pending lawsuit. Becoming desperate at this point, you reach out for one last lifeline and ask the court to enforce the claim as erroneously issued. Completing the Catch-22 script, the court then holds that, because the issued claim omits a material limitation and the omission is not evident on the face of the patent, the uncorrected claim fails to satisfy Section 112 and cannot be asserted.

And so, due to a printing error by the Patent Office – one that was not even evident on the face of the patent – you forfeit the right to enforce your claim against an infringer. Admittedly, the foregoing set of facts represents a “perfect storm” unlikely to recur too often. Yet this case raises a number of warning flags that all of us would do well to recognize.

A Reliable Intellectual Property Outsource For Non-IP Law Firms

January 11th, 2015 by Thomas J Germinario

What do you do when one of your clients calls with an intellectual property question?

It’s probably happened to you more than a few times already. A valued client calls, and he or she is looking to patent an invention, register a trademark, or copyright some software. The volume of IP matters that come to your firm doesn’t justify hiring an IP partner. So all you can do is refer your client to an IP attorney who has no connection with your firm and is not accountable to you for the type of service he/she provides to your client. Your IP attorney referral may be just a name you pulled out of a professional publication or website. But your client is looking to you to place them in the hands of someone you can vouch for, someone who will treat them the way you would if you were handling the matter yourself. The goodwill and trust that you’ve spent years cultivating with your client is on the line here — yet you have absolutely no control of the situation. There must be a better way to handle these situations.

Doesn’t it make more sense to establish a regular IP outsource for your firm?

Instead of a series of blind IP referrals, wouldn’t it be better to have an experienced practitioner “on call” to serve your clients’ IP needs? Ideally, such a practitioner would keep you “in the loop”, reporting back to you on the progress of the IP matter and conferring with you on issues that may have repercussions on other legal matters your firm is handling for the client. Ideally, such a practitioner would be working for you as well as for your client, so that the quality of his IP services reflects favorably on your firm and reinforces your firm’s bond with the client. Obviously, a referral outsource to a large firm with an IP practice doesn’t fit the bill here, because the large firm mentality will inevitably come to envision your client becoming their client. And, as the hierarchy of the large firm takes control of the matter, you will be relegated to the back seat, like it or not.

So where do you find an IP outsource that’s truly accountable to your firm?

If you’re looking to fill a niche, look for something that’s specifically tailored to fit that niche. The IP practice of Thomas J. Germinario has been purposefully structured to fit seamlessly into any small-to-medium-sized general law practice and provide the functional equivalent of an in-house IP partner. The Germinario firm is looking for more than referrals from your firm — we are looking for a relationship in which we become an extension of your firm in IP matters, and you become our “go to” for matters within your practice areas.

What sort of practitioner should you be looking for in an IP outsource?

If your clients were huge multi-national corporations with massive patent portfolios, you’d have your own in-house IP department. Since you don’t, your clients are individuals and small-to-medium-sized businesses that have occasional IP involvement. So you want a practitioner whose approach to IP issues is geared to the needs of clients who are not major players in the IP arena. For such clients, cost and time are important factors. Big pharmaceutical companies are prepared to spend millions over decades in efforts to expand their patent claims to the marginal disadvantage of their competitors. The small inventor does not need, nor can they afford, this type of patent prosecution. They need their patent to issue quickly, at minimal cost, and give them basic protection against “knock-offs” and “work-arounds” of their product. The firm of Thomas J. Germinario has perfected a “streamlined” patent prosecution methodology specifically geared to the individuals and small-to-medium-sized businesses. Our methods lead to patent issuance is as little as six months. With other IP firms, your clients will see their patent applications become mired in a bewildering morass of procedural maneuvers which may extend patent prosecution over many years and transform their invention into a veritable “money pit”. Tragically, many small inventors are financially overwhelmed by this process and are forced to abandon their inventions before a patent issues.

Which IP credentials are most important to your clients?

In order to provide a full range of IP services, the practitioner should be licensed to practice before the U.S. Patent and Trademark Office. Experience in patent, trademark and copyright prosecution is also an important credential. Thomas J. Germinario is a licensed Patent Attorney (Reg. No. 52,939) who has been practicing IP law for over 20 years. He has extensive experience over that time period in patent prosecution as well as trademark and copyright registration. His patent prosecution experience encompasses varied inventions in the mechanical, electrical/electronic, chemical, medical, software and computer fields. Mr. Germinario is a licensed Professional Engineer who is able to provide inventors with legal guidance which is informed by his technical expertise. He is also an experienced litigator who can effectively enforce your clients’ IP rights and defend them against infringement actions.

How do you arrange for the firm of Thomas J. Germinario to become your firm’s IP outsource?

It’s as simple as picking up the phone or emailing Thomas J. Germinario using the contact information below. If you have a client in immediate need of IP services, a consultation can be arranged at your firm’s offices or ours. If a general discussion of future IP needs is more in order, an informal meeting can be arranged at your convenience.

Tripping over the On Sale Bar

November 23rd, 2014 by Thomas J Germinario

The last thing a business needs is to invest heavily in obtaining a patent on a product, only to see the patent invalidated when they attempt to enforce it against an infringer. Because of a statutory provision commonly known as the “on sale bar”, this can happen if a business is not extremely careful about engaging in commercial transactions involving their new product prior to filing a patent application. And the task of avoiding the on sale bar has become even more problematic since the advent of the Leahy-Smith America Invents Act (AIA), which added language to the provision that is yet to be definitively interpreted by the courts.

Let’s first consider the pre-AIA version of the on sale bar, 35 USC §102(b), which applies to any US patent application filed before March 16, 2013. It bars patenting any invention that was “in public use or on sale in this country, more than one year prior to the date of application for patent in the United States.” As interpreted by the US Supreme Court, the pre-AIA on sale bar involves a two part test: (1) the invention must be the subject of a commercial offer for sale, and (2) the invention must be ready for patenting. Under Federal Circuit Court rulings, moreover, a commercial offer for sale sufficient to create an on sale bar can include sales between a supplier and a manufacturer. So if a US business has designed a new product and places a purchase order with its supplier for an initial production run, the one-year clock begins to run as of the date the purchase order is confirmed by the supplier. And this remains true even for a foreign supplier, as long as the product is delivered to the US.

With respect to the second prong of the pre-AIA on sale bar test, Federal Circuit decisions hold that an invention can be considered “ready for patenting” if it is either (a) reduced to practice, or (b) depicted in drawings and/or specifications sufficient to enable a skilled person to practice the invention. An invention is “reduced to practice” when a working prototype is made. Therefore, an initial production run of a product, no matter how small, will satisfy the test of being “ready of patenting”, unless the products are used only for experimental purposes.

For patent applications filed on or after March 16, 2013, the post-AIA version of the on sale bar, 35 USC §102(b) applies. The new provision bars patenting any invention which, more than one year prior to the effective filing date, was “in public use, on sale, or otherwise available to the public.” I have added italics to indicate the newly added phrase, which, as of this writing, the courts have yet to interpret. The problem is that the new language can either be read as expanding the class of events that will give rise to an on sale bar or constricting it. Although some commentators have suggested that the post-AIA on sale bar applies only to sales to the public, as opposed to sales from a supplier to a manufacturer, that reading cannot be assumed at this point.

Until the courts speak definitively on the scope of the post-AIA on sale bar, the best practice for businesses to follow is file a patent application, even if only a provisional one, before engaging in any type of commercial transaction that could be interpreted as a sale.

Keeping Tabs on the Competition’s Patent Filings

November 22nd, 2014 by Thomas J Germinario

Here’s a real nightmare scenario, but one which actually happened to one my clients recently. They’d been manufacturing and selling a product line for almost a decade, but were shocked to learn that one of their competitors had pending patent applications which, if approved, would give them exclusive rights to the product design. “What can we do to prevent these patents from issuing?!” was the client’s somewhat panicked email inquiry to me.

While the patent statutes and rules provide for pre-issuance opposition to the grant of a patent, the protest must either be initiated before the patent application is published or with the express consent of the applicant. This presents something of a quandary, since a patent application is not publically accessible until it’s published, usually 18 months after filing. On the other hand, waiting until after a competitor’s patent issues to challenge its validity is not a good option for many businesses, since post-issuance review often involves lengthy and costly trial litigation.

I advised my client to consider the more cost effective approach of preparing a pre-issuance Third Party Submission under 37 CFR §1290. This provision allows a third party, that is, someone other than the patent applicant, to submit documents to the patent examiner reviewing a pending application. Submissions may include any patents, published patent applications, or other printed publications that are potentially relevant to the examination of the application. Accompanying the submission must be an explanation of how each document relates to the claims made in the patent application. Since the window for making a Third Party Submission can close six months after the application is published, a certain amount of vigilance is required in monitoring the competition’s patent filings.

Printed publications eligible for submission under this procedure include non-patent publications, such as internet web pages. Fortunately for my client, they had a long-standing website that described their product line in some detail. But we also needed to submit evidence that this website was published before the filing date of the competitor’s patent application. For that purpose, we referred to a web archive to retrieve the client’s archived web page predating the application filing. By the way, the most comprehensive web archive goes by the name of the “Wayback Machine”, borrowed from the vintage cartoon series “Mr. Peabody’s Improbable History”.

Thomas Jefferson reputedly once observed that the price of liberty is eternal vigilance. Something like eternal vigilance is also vital to any business that doesn’t want to see its profitable product lines shut down by a competitor’s patent activity. The cost of retaining patent counsel to help monitor the competition’s patent filings can be small compared to the potential downside of remaining oblivious.

Interpretation of the Safe Harbor Provision (JPPCLE): Judge Lourie’s Concurrence (Part 3)

November 20th, 2014 by Thomas J Germinario

The following was presented at the Joint Patent Practice Seminar, April 2014. Read part 1 here and part 2 here.

Restriction vs Election of Species

While Circuit Judge Alan Lourie – coincidentally our luncheon speaker today – agreed with the majority’s conclusion in denying Safe Harbor status to the Janzen patent, he remarks that “the majority opinion overcomplicates the analysis of this appeal and improperly commingles restriction practice with election of species practice”. By focusing strictly on the clear lines of demarcation set down by the device-method restriction requirements of the parent and grandparent applications, the concurring opinion avoids the morass of the majority’s “multi-level” consonance approach.

In the parent application that preceded both the Janzen patent and the ’498 sibling patent, the patent examiner, beyond making a restriction requirement, also required an election of species from what were referred to as patentably distinct species A, B, and C, stating “the claims shall be restricted if no generic claim is finally held to be allowable. Currently no claims are generic.” Such a requirement for election of species is not the same as a restriction requirement. It is tentative and its consequences are avoidable by the applicant obtaining the allowability of a generic claim encompassing the various species or by filing separate applications to pursue the nonelected subject matter. In my view, the district court and the majority err in even considering the effect of the requirement for election of species in this case.

Judge Lourie aptly notes that, pursuant to 37 C.F.R. §1.146, a species election is not equivalent to a restriction requirement. An election of species is provisional and subject to the allowance of a linking generic claim, which would result in rejoinder of the non-elected claims.   Consequently, the majority’s “multi-level” consonance analysis lays down a maze of demarcation lines that can shift during the course of the prosecution of the restricted patent. Under such an erratic reckoning, the Harbor is anything but safe.

A Word to the Wise

Practitioners would be well advised not to extend the majority reasoning beyond the facts of this case, as it’s likely to prove intractably cumbersome, particularly in situations in which viable generic claims are in play in the restricted applications. Over time, a series of decisions distinguishing St. Jude will likely evolve the Safe Harbor doctrine closer to the version propounded in Judge Lourie’s concurring opinion.

Interpretation of the Safe Harbor Provision (JPPCLE): Drawing Lines Of Demarcation (Part 2)

November 20th, 2014 by Thomas J Germinario

The following was presented at the Joint Patent Practice Seminar, April 2014. Read part 1 here.

1. Lineage and Consonance

Patent jargon is full of colorful genealogical metaphors; and so we have patent “families”, “parent” and “child” applications, and even “lineage”. Since, in the biological sense, none of us can choose our lineage, we consider it unfair for any of us to suffer prejudice because of it. And a very similar ethical sensibility applies to the Safe Harbor doctrine. Since the patentee cannot control the lineage of a patent resulting from a restriction requirement, the sanctions of double patenting should not apply. In one of its few glimmers of lucidity, the otherwise turbid verbiage of the Safe Harbor provision speaks to applications filed “as a result of” a restriction requirement. Interpreting this pregnant phrase, the seminal court rulings hold that patents issued “as a result of” a restriction requirement can’t be cited as references against each other for double patenting purposes. These decisions have developed a logical framework for the Safe Harbor based on a lineal relationship between the “restricted” application, the “reference” application, and the “challenged” application.

If the first pier of the judicially restructured Harbor is “lineage”, the second pier is something called “consonance”. Not only must the “restricted”, “reference” and “challenged” applications all share a common lineage, but they must all honor the lines of demarcation drawn by the original restriction requirement. While acknowledging that consonance was the “most challenging issue” in the St. Jude case, the trial court nevertheless stumbled over the complex lines of demarcation imposed by both restriction and species election requirements. Let’s see if we can understand why.

2. Multi-Level Consonance?

St. Jude Medical was seeking enforcement against Access Closure of the Janzen patent (7,008,439), which taught a particular device for plugging a vascular puncture, as well as an associated method. The jury at trial had found that Janzen’s claims were not patentably distinct from those of another St. Jude patent (5,725,498), which was a “sibling” of the Janzen patent. On that basis, the jury found that the Janzen claims were potentially invalid for obviousness-type double-patenting over the “sibling” patent, subject to the trial court’s determination of the applicability of the Safe Harbor provision. Janzen and its sibling were both continuations of a common parent (5,830,130), which issued on an application filed as a divisional of a grandparent (5,391,183).

In both the grandparent and parent applications, a restriction was imposed between two groups of claims: Group I, drawn to devices for plugging vascular punctures, and Group II, drawn to methods for plugging vascular punctures. Along with the restriction requirements came a requirement for election between three apparatus species, designated as A, B and C. In the grandparent and parent applications, St. Jude elected Group I (device) and Species B. The Janzen patent was issued with both device (Group I) and method (Group II) claims involving a Species C apparatus.

Access Closure argued that the relevant line of demarcation established in the parent and grandparent applications was between Groups I and II, devices and methods, and that Janzen claims, by straddling that line, were not entitled to Safe Harbor protection. On its side, St. Jude propounded a novel theory of “multi-level” consonance, according to which the requirement to elect species – and even sub-species and sub-sub-species – gives rise to multiple layers of “non-elected subject matter”, all of which is fair game for subsequent divisional and continuation applications. In this reckoning, the lines of demarcation merge into a hopelessly convoluted matrix from which double-patenting-exempt applications can proliferate almost endlessly.

Surprisingly, both the District Court and the Fed Circuit majority bought into this Byzantine approach. Their respective consonance analyses differed, leading to reversal of the District Court’s judgment in favor St. Jude, only because the Fed Circuit interpreted the scope of the sibling patent claims more broadly, as extending across methods (Group II) pertaining to all three apparatus species. The Fed Circuit outcome retains a measure of rationality only because they, somewhat arbitrarily, limit the application of their “multi-level” consonance methodology to the election of species, and not also to sub- and sub-sub-species, as St. Jude urges in its brief. Logical consistency in this misguided dispensation would actually have resulted in as many as 240 potential protected divisional categories1 – enough to float an armada of applications into the Safe Harbor!

Part 3: Judge Lourie’s Concurrence »


1 In the parent and grandparent applications, election was required among 3 species, 8 sub-species and 5 sub-sub-species, thus engendering, along with the two restriction groups, 240 possible combinations.

Interpretation of the Safe Harbor Provision (JPPCLE): Policy Background (Part 1)

November 20th, 2014 by Thomas J Germinario

The following was presented at the Joint Patent Practice Seminar, April 2014

1. Competing Doctrines: Double Patenting vs Restriction

According to the religious lore of Catholicism, St. Jude is regarded as the patron of difficult cases. He certainly lives up to his reputation in the case of St. Jude Medical, Inc. et al. v. Access Cloture, Inc., decided by the Federal Circuit on last year’s 9-11 anniversary.

The Fed Circuit had the unenviable task of grappling with the so-called “Safe Harbor” provision of 35 U.S.C. §121. The Safe Harbor provision, the Court observes with tongue-in-cheek, is “not a model of clarity”. In fact, it’s an example of one of those interminable sentences that could only have been penned by someone steeped in the discipline of patent claims drafting.  It reads as follows:

A patent issuing on an application with respect to which a requirement for restriction under this section has been made, or on an application filed as a result of such a requirement, shall not be used as a reference either in the Patent and Trademark Office or in the courts against a divisional application or against the original application or any patent issued on either of them if the divisional application is filed before the issuance of the patent on the other application.

Short of invoking the Saint’s miraculous intervention, a bit of background on the genesis of this provision is definitely in order here if we are to set a course for the Safe Harbor through the fog of its cryptic prose. Enacted as part of the 1952 Patent Act, it was intended to reconcile a conflict between two fundamental principles of patent law: that there shall be only one patent per invention, and that there shall be only one invention per patent. These two principles express themselves, respectively, in the doctrines pertaining to double patenting and claims restriction practice.

2. Safe Harbor as Collision Insurance

Each of these two competing doctrines has its own equity-based policy underpinnings. On one hand, the proscription against double patenting aims at preventing the over-extension of patent protection by filing successive applications based on obvious variants of the same invention. On the other hand, the imposition of restriction requirements ensures that claims for patentably distinct inventions are prosecuted in separate applications. In a perfect world, these two policies would never clash, but in the real world – as all of us are painfully aware – patent examiners and judges are fallible, and their opinions on what are or are not patentably distinct inventions are apt to differ.

By way of example, an examiner requires that the applicant elect between claims 1-10 and claims 11-20, based on his/her non-appealable judgment that they are directed to two different inventions. The applicant dutifully elects claims 1-10 and then files a divisional application based on claims 11-20. Patents issue on both applications, but in subsequent infringement litigation, the defense of invalidity based on double patenting is raised, and the court concludes that the two groups of claims are not patentably distinct. Despite having steered its applications on the only course allowed by the PTO, the patentee suffers a collision that sinks its claims and works a forfeiture of its rights.

To prevent such manifest injustices, Congress saw fit to create the Safe Harbor, in which restriction-driven divisional applications and their progeny would not encounter the perils of double patenting on the open sea. But the compass of the Harbor needs to be carefully circumscribed, lest it become a channel for by-passing the double patenting proscription altogether. In the St. Jude appeal, the Fed Circuit had the opportunity to set out some marker buoys to better define the limits of the Harbor. Let’s consider how they went about doing that.

Part 2: Drawing Lines of Demarcation »

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