Fresh From the Bench: Precedential Patent Cases From the Federal Circuit
In Shire, the panel rejects defendant’s attempt to read “consisting of” as though the claims read “consisting essentially of.”
While we normally limit our comments to precedential opinions, given the dearth of precedential rulings in the past two weeks I can’t help but comment on the Circuit’s recent Apple v. Samsung decision. Here, the Circuit remands the case back to the district court to decide how to apply the design patent statute’s “article of manufacture” language to the smart phone wars.
Shire Development v. Watson, Fed. Cir. Case 2016-1785 (Feb 10, 2017)
The panel reverses a determination of infringement of a patent directed to controlled-release oral composition of mesalamine used to treat inflammatory bowel diseases, concluding that Watson’s ANDA product does not satisfy the Markush group requirements of the claims. In doing so, the Circuit rejects Shire’s argument that its evidence overcomes the “strong presumption” that a claim element excludes ingredients not specified in the claim when the phrase “consisting of” or “consists of” is used in the claim.
When a matrix is hydrophilic, it readily dissolves in water. Conversely, when a matrix is lipophilic, it resists dissolving in water. The claims at issue recite in pertinent part:
Controlled release oral pharmaceutical compositions, containing as an active ingredient 5-amino-salicylic acid, comprising: a) an inner lipophilic matrix consisting of substances selected from the group consisting of [components listed], and wherein the active ingredient is dispersed both in the lipophilic matrix and in the hydrophilic matrix; (b) an outer hydrophilic matrix wherein the lipophilic matrix is dispersed, and said outer hydrophilic matrix consists of compounds selected from the group consisting of [components listed]. (emphasis added)
The district court determined that Watson’s ANDA product satisfied the Markush limitations because the excipients falling outside the respective Markush groups were “unrelated” to the invention since they did not drive the water-affinity property of their respective matrices.
The panel first notes that claim limitations using the phrase “consisting of,” or “consists of,” to characterize the matrix, and “consisting of” to define the groups, “create a very strong presumption that that claim element is closed and therefore excludes any elements, steps, or ingredients not specified in the claim.” Overcoming this presumption requires “the specification and prosecution history” to “unmistakably manifest an alternative meaning.” The panel noted the 2004 Norian Circuit case that found the strong presumption to be overcome where a defendant added a spatula to a chemical kit to repair teeth and bones, because the spatula had no interaction with the claimed chemicals.
In the present case, Watson’s ANDA product included additional compositions, some of which are hydrophilic and others of which are lipophilic. The district court found that Watson infringed because the component outside of the Markush group—i.e., the lipophilic magnesium stearate in the hydrophilic outer matrix—is unrelated to the invention. However, the panel disagrees. According to the opinion, the invention is a multimatrix system that relies on the hydrophilic and lipophilic characteristics of the matrices to release mesalamine in the colon in a sustained and uniform manner. When the outer, hydrophilic matrix interacts with a person’s digestive fluids, the matrix creates a swollen barrier preventing aqueous solution from reaching the inner, lipophilic matrix. This delay permits the product to proceed through the digestive system until the water breaks apart the outer matrix, releasing the lipophilic granules. Here, the district court concluded that the magnesium stearate is overwhelmed by the hydrophilic properties of the sodium starch glycolate, and credited expert testimony that the hydrophilic sodium starch glycolate is more potent than the mag stearate when outside the granules.
The district court found that the magnesium stearate exerted lipophilic influence in the outer matrix. According to the opinion, no one has suggested that magnesium stearate, when in the outer matrix, is neither lipophilic nor hydrophilic. Thus, the panel concludes that the magnesium stearate retains its lipophilic character in the extragranular space. Accordingly, the magnesium stearate structurally and functionally relates to the invention, and its presence in the outer matrix violates the “consisting of” requirement of the claims.
Again according to the opinion, Norian did not restrict “related” components to only those that advance or are intended to advance a Markush group’s allegedly inventive elements, which would in effect equate the scope of a Markush group’s “consisting of” language with either “comprising” or “consisting essentially of.”
Apple v. Samsung, Fed. Cir. Case Nos. 2014-1335, 2015-1029 (February 7, 2017)
On remand from the Supreme Court to determine how the “article of manufacture” language from 35 U.S.C. § 289 applies in the present case in which certain Samsung Galaxy smart phones were found to infringe Apple’s design patents, a panel of the Circuit punts, and simply remands the case to the district court. It will be recalled that the Supreme Court ruled that the “article of manufacture” might be something other than the entire device when the device includes multiple components. However, the Court did not weigh in on what the article or manufacture might be in the present case.
Apple asked the Circuit to affirm the $400 million design patent infringement award because Samsung never asserted that the relevant “article of manufacture” was anything other than Samsung’s entire phones. Samsung argued that the Circuit should remand for a new trial on damages.
Because the parties dispute what jury instructions the trial record supports, the panel rules that the district court is in a better position to evaluate the parties’ arguments and determine what additional proceedings, if any, are necessary. In the words of Chief Judge Prost: “If the court determines that a new damages trial is necessary, it will have the opportunity to set forth a test for identifying the relevant article of manufacture for purposes of § 289, and to apply that test to this case.” Presumably, if it determines that a new trial is not necessary, it will have accepted Apple’s argument that the relevant article of manufacture has already been determined to be the entire smart phone.