Recent U.S. case law on ( in )validity

1. Recent U.S. case law on (in)validity C5 6th International Freedom to Operate ForumLondon, April 20, 2009 Daniel M. Becker

2. Cases reviewed: statutory bases C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

3. Cases reviewed: other, non-statutory, considerations C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

4. § 102(b) • In re Gleave (Fed. Cir. March 26, 2009) • holding: reaffirming existing case law, the Federal Circuit held that a prior art reference does not need to disclose a utility in order to anticipate a later claim to the prior-disclosed compound • holding: a list of species, no matter how great the number of entries, is a disclosure of each of the individually listed species; such list is not properly analogized to a genus of compounds that is combinatorially defined by a chemical framework having multiple positions that are independently substitutable from separate lists (R1, R2, R3, . . . ) C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

5. § 102(b) • In re Gleave • appealed claim: 1. A bispecific antisense oligonucleotide, wherein substantially all of the oligonucleotide is complementary to a portion of a gene encoding human IGFBP-2 and substantially all of the oligodeoxynucleotide is also complementary to a gene encoding human IGFBP-5, and wherein the oligodeoxynucleotide is of sufficient length to act as an antisense inhibitor of human IGFBP-2 and human IGFBP-5. • claim construction: claim 1 does not require antisense activity: “the claims at issue merely require [that] the oligonucleotides . . . be ‘of sufficient length to act as an antisense inhibitor.’” • the prior art: C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

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7. § 102(b) • In re Gleave • the doctrinal tension • to anticipate, a prior art reference must enable one of ordinary skill in the prior art to make and use the invention • this requirement flows directly from the public policy that a patent cannot be permitted to withdraw from the public that which was earlier in the public’s possession; black letter law • Gleave argued that the prior art fails to anticipate because it does not enable use of the antisense oligonucleotides • the standards for judging “enablement” of a prior art reference differ from those required to enable a claim • In re Hafner (CCPA 1969) • Novo Nordisk Pharms., Inc., v. Bio-Tech Gen. Corp. (Fed. Cir. 2005) • Rasmusson v. SmithKline Beecham Corp. (Fed. Cir. 2005) (method of treatment!) C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

8. § 102(b) • In re Gleave • the court’s reasoning: • the court (properly) distinguished claims drawn to compositions of matter from those drawn to methods of use • for method claims, “the ‘make’ requirement becomes, in effect, a ‘use’ requirement” • for compositions of matter, “a reference satisfies the enablement requirement of §102(b) by showing that one of skill in the art would know how to make” • “Greave’s claims are to compositions of matter – oligonucleotides – and therefore a reference satisfies the enablement requirement of §102(b) by showing that one of skill in the art would know how to make the relevant sequences disclosed in [the prior art reference].” C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

9. § 102(b) • In re Gleave • take home lesson: in silico genomic and proteomic data that have been accessioned into databases (“ink, formed into strings of letters, without inventive thought and without placing the public in possession of anything new”) (including electronically filed sequence listings) provide a universe of potential prior art that may be useful for invalidating claims in more recently issued patents claiming nucleic acids as compounds per se – antisense, SiRNA, miRNA, etc. C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

10. § 103 • In re Kubin (Fed. Cir. April 3, 2009) (Rader) • holding: cloning of the protein antigen recognized by a prior art monoclonal antibody, using art-established expression cloning techniques and the prior art antibody itself for clone selection and validation, where the prior art taught the importance of the antigen and also prophetically taught that the antigen could be isolated using such antibody and standard techniques, held obvious, notwithstanding the fact that claims were drawn to compositions of matter with structural limitations (sequence) that could not be predicted a priori. • holding: continued reliance on In re Deuel (Fed. Cir. 1995) is no longer tenable C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

11. § 103 • In re Kubin • holding: “obvious-to-try” affirmed as a viable obviousness rationale, even in the so-called “unpredictable arts”; the “obvious-to-try” analytical approach of In re O’Farrell (Fed. Cir. 1988) is explicitly and particularly reaffirmed: • “This court in O’Farrell ... observed that an obviousness finding was appropriate where the prior art ‘contained detailed enabling methodology for practicing the claimed invention, a suggestion to modify the prior art to practice the claimed invention, and evidence suggesting that it would be successful.’ Responding to concerns about uncertainty in the prior art influencing the purported success of the claimed combination, this court stated: ‘[o]bviousness does not require absolute predictability of success . . . all that is required is a reasonable expectation of success.’” (emphasis added by Kubin court) C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

12. § 103 • In re Kubin • the appealed claim: • the structural limitation: • Specification: “The NAIL polypeptide comprises a signal peptide (amino acids 1 – 21 of SEQ ID NO:2), and extracellular domain (amino acids 22-221 of SEQ ID NO:2), a transmembrane domain (amino acids 222-245 of SEQ ID NO:2), and a cytoplasmic domain (amino acids 246-365 of SEQ ID NO:2).” C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

13. § 103 • In re Kubin • the appealed claim: • the functional “limitation”: • court: C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

14. § 103 • In re Kubin • the prior art: * * * * * * C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

15. § 103 • In re Kubin • the court’s reasoning: C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

16. § 103 • In re Kubin • the court’s reasoning: C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

17. § 103 • In re Kubin • take home lesson: in assessing the obviousness of claims, it is critical to determine, at the most abstract level, what the inventors’ real contribution to the art was: • “The record in this case shows that [the prior art reference] did not explicitly supply an amino acid sequence for NAIL or a polynucleotide sequence for the NAIL gene. In that sense, Kubin and Goodwin’s disclosure represents some minor advance in the art. But granting patent protection to advances that would occur in the ordinary course without real innovation retards progress. Were it otherwise patents might stifle, rather than promote, the progress of useful arts.” (quoting KSR) • take home lesson:absent an unexpected technical challenge or unexpected result that is clearly embodied in an affirmative claim limitation, any claimed molecular biology “invention” that could have been made by any of hundreds of undistinguished and undistinguishable labs, should be vulnerable for obviousness C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

18. § 103 • In re Kubin • take home lesson: claim limitations drawn to inherent structural features, such as (i) nucleic acid or protein sequences, (ii) bioinformatically-predicted protein domains (intracellular domain, transmembrane domain, extracellular domain, hydrophilic domains, dimerization domains, etc.), (iii) amino acid sequences of antibody V regions or CDRs, should be viewed critically, and can at times be discounted as adding little, if anything, to the nonobviousness of the claims, even if those inherent structures could not have been predicted a priori • take home lesson:beware the tendency to reduce case law precedent to short sound bites, believing the holding somehow to be immutable (In re Deuel; In re Bell) • take home lesson: Judge Rader is among the most biotech- and patent-friendly of the Federal Circuit judges; this decision is unlikely to be an outlier. C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

19. § 112, ¶ 1, written description • Ariad Pharms., Inc. v. Eli Lilly & Co. (Fed. Cir. April 3, 2009) • holding: the specification must describe compounds suitable for performing claimed methods, even when the claims do not themselves explicitly recite use of a compound • holding: reaffirming existing case law, the Federal Circuit held that the adequacy of written description is determined as of the effective filing date accorded to the claim (i.e., as of “the filing date sought” by the patentee) • holding: reaffirming existing case law, the Federal Circuit reaffirmed that the written description must be commensurate in scope with the invention claimed: claims must not “overreach the scope of the inventor’s contribution to the field of art as described in the patent specification.” C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

20. § 112, ¶ 1, written description • Ariad v. Eli Lilly Ariad claim: Univ. of Rochester claim*: *Univ. of Rochester v. G.D. Searle & Co. (Fed. Cir. 2004) C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

21. § 112, ¶ 1, written description • Ariad v. Eli Lilly • court’s reasoning:“Ariad attempts to categorically distinguish Rochester, Fiers, and [Regents of UC v.] Eli Lilly, because in those cases, the claims explicitly included the non-described compositions .... Ariad’s attempt to distinguish these cases is unavailing. Regardless of whether the asserted claims recite a compound, Ariad still must describe some way of performing the claimed methods.... [T]o satisfy the written description requirement for the asserted claims, the specification must demonstrate that Ariad possessed the claimed methods by sufficiently disclosing molecules capable of reducing NF-κB activity....” C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

22. § 112, ¶ 1, written description • Ariad v. Eli Lilly • effect of “(in)effective” filing date • Because Ariad had sought the earliest possible effective filing date to avoid express and inherent anticipation, and written description “is determined as of the filing date – April 21, 1989 in this case – evidence of what one of ordinary skill in the art knew in 1990 or 1991 cannot provide substantial evidence to the jury that the asserted claims were supported by adequate written description.” C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

23. § 112, ¶ 1, written description • Ariad v. Eli Lilly • take home lesson: do not reflexively assume that invalidity contentions are best served by denying the patentee its earliest claimed filing date • take home lesson: critically assess the timewise relevance of any evidence that the patentee proffered during prosecution to support adequacy of written description • take home lesson: in assessing the adequacy of written description, assess at the most abstract level what the inventors’ real contribution to the art was, because “the scope of the right to exclude must not overreach the scope of the inventor’s contribution to the field of art as described in the patent specification” C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

24. § 112, ¶ 2 • Halliburton Energy Svcs. v. M-I LLC (Fed. Cir. 2008) • holding: even when the patentee can articulate a definition supported by the specification, claims are indefinite if the scope of the claim varies depending on factors external to claim C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

25. § 112, ¶ 2 • Halliburton Energy • claim: 1. A method for conducting a drilling operation in a subterranean formation using a fragile gel drilling fluid comprising: (a) an invert emulsion base; (b) one or more thinners; (c) one or more emulsifiers; and (d) one or more weighting agents, wherein said operation includes running casing in a borehole. • patentee’s proffered construction of “fragile gel”: (i) easily transitions to a liquid state upon introduction of force; and (ii) at rest, is capable of suspending drill cuttings and weighting materials; and (iii) contains no organophilic clay . . . . C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

26. § 112, ¶ 2 • Halliburton Energy • the court’s reasoning: “[U]nder Halliburton’s proposed construction in this case, an artisan would not know from one well to the next whether a certain drilling fluid was within the scope of the claims because a wide variety of factors could affect adequacy (formation geology, wellbore size, depth, angle, etc.). In other words, a given fluid might be adequate to suspend drill cuttings in some formations and/or well configurations, whereas in others it would not be. When a proposed construction requires that an artisan make a separate infringement determination for every set of circumstances in which the composition may be used, and when such determinations are likely to result in differing outcomes (sometimes infringing and sometimes not), that construction is likely to be indefinite.” C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

27. § 112, ¶ 2 • Halliburton Energy • the decision explicitly reaffirms Geneva Pharms. v. GlaxoSmithKline (Fed. Cir. 2003) • claims tosynergistically effective amountin the combination of amoxicillin and clavulanic acid (Augmentin) held indefinite because “a given embodiment would simultaneously infringe and not infringe the claims, depending on the particular bacteria chosen for analysis.” C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

28. § 112, ¶ 2 • Halliburton Energy • take home lesson: long considered an unlikely basis for invalidating claims, given the requirement that a claim be “insolubly ambiguous” and “not amenable to construction” to be held to be indefinite, the Federal Circuit has recently reinvigorated this basis for challenging claim validity • take home lesson: look for express or implied reference to conditions and events external to the claim; if the same embodiment would both fall within the scope and infringe, and outside the scope and not infringe, depending on externalities, claims may be indefinite • take home lesson: analogously, look for a test or measurement required by the claim (e.g., “binds to the same antigenic epitope”), without the specification setting forth a single defining assay C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

29. Obviousness-type double patenting • Pfizer, Inc. v. TevaPharmaceuticals USA, Inc. (Fed. Cir. 2008) • holding: the protection against obviousness-type double patenting provided by 35 USC § 121 applies only to patents that later-issue from true divisional applications, i.e, applications filed in response to, and consonant with, a restriction requirement; section 121 does not apply to shield continuations-in-part (CIPs) C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

30. Obviousness-type double patenting • Pfizer v. Teva • background • obviousness-type double patenting is a judicially-created doctrine designed to prevent unjustified time-wise extension of right to exclude • the doctrine prohibits a patentee “from obtaining an extension of the right to exclude through claims in a later patent that are not patentably distinct from claims in a commonly owned earlier patent” • compare the claimsof the later-issued patentto the claimsof the earlier-issued patent • later claims are not patentably distinct if: • later claims anticipated by the claims of the prior-issued patent • later claims obvious over the claims of the prior-issued patent • later claimed subject matter overlaps prior claims, with both earlier and later claims reading on the preferred embodiment (Schneller-type) • later patent separately claims the earlier claimed invention’s utility C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

31. Obviousness-type double patenting • Pfizer v. Teva • background • obviousness-type double patenting can be cured by disclaiming the terminal portion of the term of the second patent that extends beyond that of the first • and there is a “safe harbor”: 35 U.S.C. § 121 fully protects a later issued patent from obviousness-type double patenting where the later claims issue from a divisional application “filed as a result of,” and with claims fully consonant with, a restriction requirement that was applied in the prosecution of the earlier-issued patent • the Federal Circuit has construed Section 121 broadly to provide a safe harbor for later-issued patents over earlier-issued patents if the two “patents [are] similarly derived from the same restriction requirement.” C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

32. Obviousness-type double patenting • Pfizer v. Teva • holding: Pfizer’s later Celebrex patent, which issued from a CIP of an application in which the restriction requirement was made, is not entitled to protection under § 121 • “We conclude that the protection afforded by section 121 to applications (or patents issued therefrom) filed as a result of a restriction requirement is limited to divisional applications. . . . Here, the [later-issued] . . patent, was filed as a CIP and not a divisional application. We hold that section 121 does not apply. . . . “ C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

33. Obviousness-type double patenting • Pfizer v. Teva • take home lesson: U.S. patents identified as an FTO concern should not be assessed in isolation, but rather in the context of their respective families; the family relationships should be critically assessed by detailed de novo review of the file wrappers to determine the actual genealogical relationships • take home lesson: obviousness-type double patenting is a cognizable basis for ex parte and inter partes reexamination, In re Lonardo (Fed. Cir. 1997) (basis for the Cabilly II reexam); although the defect is curable by the patentee’s filing of a terminal disclaimer, the filing of a TD may be all that is needed to clear FTO; example… C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

34. Obviousness-type double patenting C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

35. Reexam • In re Swanson (Fed. Cir. 2008) • holding: a substantial new question of patentability (“SNQ”) sufficient to support a request for reexamination can be presented by a reference that was previously considered and appliedin a rejection during prosecution, if the “particular question of patentability presented by the reference” in the reexam request differs from that the question of patentability presented during prosecution • holding: a substantial new question of patentability (“SNQ”) sufficient to support a request for reexamination can be presented by a reference that was previously considered by a district court during infringement litigation C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

36. Reexam • In re Swanson • background: 2002 amendment to 35 U.S.C. § 303 explicitly overturned the Federal Circuit’s earlier holding in In re Portola Packaging (Fed. Cir. 1997), that the presumption of administrative correctness precludes the finding of an SNQ over art cited during prosecution: C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

37. Reexam • In re Swanson • case facts: the particularreference at issue, Deutsch, was considered during initial examination, where it was applied as a secondary reference for rejecting various claims as obvious. In the reexam request, the reference was asserted to anticipate various of the claims. • court’s reasoning: “In light of the extremely limited purpose for which the examiner considered Deutsch in the initial examination, the Board is correct that the issue of whether Deutsch anticipates the method disclosed in claims 22, 23, and 25 was a substantial new question of patentability, never before addressed by the PTO.” C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

38. Reexam • In re Swanson • case facts: the particularreference at issue, Deutsch, was considered during infringement litigation, at the end of which the jury returned a verdict that the patentee had failed to prove by clear and convincing evidence that the claims were anticipated, obvious, or otherwise invalid. The Federal Circuit affirmed that judgment in a first appeal. • court’s reasoning: two differences in standards as between proceedings in district court and in the USPTO permit the same art to present a substantial new question of patentability, even though unsuccessfully asserted during prior litigation: (i) in district court, the statutory presumption of validity applies, requiring that the defendant prove invalidity by clear and convincing evidence, whereas in administrative proceedings, a lower preponderance standard applies; and (ii) in the USPTO, claims are given their broadest reasonable interpretation consistent with the specification, whereas during litigation, the court construes the claims to ascertain their objective scope C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

39. Reexam • In re Swanson • take home lesson: in assessing whether reexam is available as an option to clear FTO (either to be threatened during license negotiations with the patentee, and/or to be undertaken to invalidate relevant claims), it is critical during review of the prosecution history to identify with particularity the exact nature of the rejections levied during prosecution, and to assess whether those rejections were the best possible rejections to be made over the art of record • take home lesson: do not discount the usefulness in invalidity challenges of art made of record during prosecution C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity

40. 2440 W. El Camino Real Mountain View, CA 94040 +1 650 813 4874 (direct) +1 650 813 4800 (main) +1 650 283 2606 (mobile) +1 650 813 4848 (FAX) daniel.becker@dechert.com C5 6th International Forum on Freedom to Operate: Recent U.S. case law on (in)validity