Latest Federal Court Cases, 05/11/20
PATENT CASE OF THE WEEK
Eagle Pharmaceuticals Inc. v. Slayback Pharma LLC, Appeal No. 2019-1924 (Fed. Cir. May 8, 2020)
This week’s Case of the Week features an appeal from the United States District Court for the District of Delaware, in which the Federal Circuit addresses issues relating to the dedication-disclosure doctrine in connection with the doctrine of equivalents. As background, Eagle Pharmaceuticals, Inc. (“Eagle”) sued Slayback Pharma (“Slayback”) for infringement of four patents that cover its brand name bendamustine pharmaceutical product, Belrapzo®. The patents-in-suit share essentially the same written description and independent claim limitations, which all cover a non-aqueous liquid pharmaceutical composition comprising bendamustine and, as relevant to this appeal, a pharmaceutically acceptable fluid containing propylene glycol (“PG”), among other things.
Eagle’s infringement claims stemmed from Slayback’s new drug application (“NDA”) for a generic version of Belrapzo®. Slayback’s generic product contains ethanol rather than the claimed propylene glycol in its “pharmaceutically acceptable fluid.” However, Eagle argued that Slayback, who had already conceded that its generic product literally infringed all other claim limitations, infringed that remaining limitation under the doctrine of equivalents because the ethanol in Slayback’s generic product is insubstantially different from the claimed PG.
The district court entered a judgment of non-infringement on the pleadings, finding that the dedication-disclosure doctrine—which applies when a patent drafter discloses but declines to claim subject matter—barred Eagle’s claims by preventing Eagle from recapturing subject matter that it disclaimed: namely, a formulation including ethanol. Eagle appealed on two grounds. First, Eagle argued that the district court erred in concluding that the asserted patents disclose, but do not claim, ethanol, and therefore dedicated ethanol to the public. Second, Eagle argued that the district court improperly applied the dedication-disclosure doctrine at the pleadings stage despite there being a factual dispute and without drawing all inferences in Eagle’s favor.
As to the first argument, Eagle contended that the asserted patents disclose three categories of bendamustine formulations—chloride salt, antioxidant, and dimethyl sulfoxide—and as such, a skilled artisan would recognize that each category works in different ways and has different ingredients. Thus, because the specification only discloses ethanol as an alternative to PG when discussing unclaimed chloride salt formulations, a skilled artisan would not have understood the specification to teach ethanol as an alternative to PG in the claimed antioxidant formulation.
The Court disagreed, explaining that the dedication-disclosure doctrine does not require the specification to disclose the subject matter allegedly disclosed to the public in an embodiment that exactly matches the claimed embodiment. Rather, the doctrine only requires that the specification disclose the unclaimed subject matter as an alternative to the relevant claim limitation. Here, the Court found that Eagle dedicated the ethanol equivalent to the public because the patents’ specification repeatedly identifies, without qualification, ethanol as an alternative pharmaceutically acceptable fluid. Nothing in the specification suggests that ethanol should be limited to a certain formulation or that the disclosure of ethanol did not apply to the claimed formulation. Moreover, the claim limitation at issue has only one stated purpose: that the fluid be pharmaceutically acceptable. Since the specification repeatedly discloses ethanol as serving that purpose, the Court held that the asserted patents indeed dedicated ethanol to the public by disclosing, but not claiming, it as an alternative to PG. As such, the Court affirmed the district court’s judgment of non-infringement.
As to Eagle’s second ground—a procedural one—Eagle asserted that a factual dispute existed at the time the district court entered its judgment of non-infringement on the pleadings, but that the court erred by resolving that factual dispute without drawing all reasonable inferences in Eagle’s favor. Specifically, Eagle argued that the district court did not accept its expert’s testimony—the only testimony on the subject—that a skilled artisan would not have understood ethanol to be an alternative to PG in the formulation. The Court disagreed, finding no error in the district court’s decision to set aside the expert testimony and grant judgment of non-infringement on the pleadings. The Court explained that application of the dedication-disclosure doctrine is a question of law, and that the district court did not err in concluding that the patents themselves provided sufficient context to decide such a question.
The Court thus affirmed the district court’s judgment of non-infringement on the pleadings.
The opinion can be found here.
ALSO THIS WEEK
Ciena Corporation v. Oyster Optics, LLC, Appeal No. 2019-2117 (Fed. Cir. May 5, 2020)
In a January 28, 2020 decision made precedential this week, the Federal Circuit held that an IPR petitioner cannot invoke the Federal Circuit’s holding in Arthrex to appeal the constitutionality of a PTAB final written decision. Ciena filed an IPR. The PTAB upheld the patentability of the claims in a final written decision. Ciena then appealed and argued that the final written decision should be vacated given that the PTAB panel was unconstitutionally appointed, citing Arthrex.
The Federal Circuit rejected the argument: “The problem with Ciena’s request is that, unlike the patent owner in Arthrex, Ciena requested that the Board adjudicate its petition. It, thus, affirmatively sought a ruling from the Board members, regardless of how they were appointed. Ciena was content to have the assigned Board judges adjudicate its invalidity challenges until the Board ruled against it. Under those circumstances, we find that Ciena has forfeited its Appointments Clause challenge.”
As a result of this decision, now precedential, Arthrex-type challenges to the constitutionality of PTAB judges are reserved solely for patent owners.
The opinion can be found here.
Caterpillar Paving Products Inc. v. Wirtgen America, Inc., Appeal No. 2020-1261 (Fed. Cir. May 6, 2020)
In a second precedential order issued this week in the aftermath of the Arthrex case, the Federal Circuit rejected a motion to vacate a PTAB decision, holding that the Arthrex decision was inapplicable. The final written decision in this IPR issued shortly before the Federal Circuit’s opinion in Arthrex. The Court held that the constitutional defects of the PTAB panel had been cured by the Arthrex decision as of the time the final written decision in the IPR issued, such that the panel and its decision were constitutional under the Appointments Clause. Caterpillar argued that “even if the panel members became constitutional immediately prior to issuing the final written decision, that does not cure a year’s worth of constitutional violations influencing the Board’s thinking and conclusions.” The Court rejected that argument, citing reasoning provided in the Arthrex decision.
The opinion can be found here.
Uber Technologies, Inc. v. X One, Inc., Appeal No. 2019-1164 (Fed. Cir. May 5, 2020)
On appeal from an inter partes review, the Federal Circuit reversed the Patent Trial and Appeal Board’s non-obviousness determination as to a limitation of the challenged claims. The claims were generally directed to exchanging location information between mobile devices, and at issue was whether the prior art rendered obvious a limitation directed to a server with software to transmit a map with plotted locations to a user. One prior art reference taught “terminal-side plotting” of the recited location information on a map on a user’s mobile device, and another reference taught “server-side plotting” of location information, as required by the limitation at issue. The Patent Trial and Appeal Board had found that combining the prior art represented impermissible hindsight, and the Federal Circuit disagreed. Because “terminal-side plotting” and “server-side plotting” were both predictable variations well-known in the art at the time of invention, the Court found that a person of ordinary skill in the art would have been presented with a simple design choice between those alternatives, with good reasons to pursue either. As such, the Court reversed the Board’s determination that the limitation was not obvious in view of the prior art, and remanded for consideration of remaining limitations of the claims.
Opinion can be found here.