Patent Law Practice Center

Federal Circuit confirms validity of patent for UCB’s Vimpat®

On May 23, 2018, the Federal Circuit issued a decision in UCB, Inc. v. Accord Healthcare, Inc. (Before Prost, C.J., Bryson, and Stoll, J.)(Opinion for the court, Stoll, J.), a case arising under the Hatch-Waxman Act. The Appellees UCB, Inc. et al own and/or license U.S. Patent No. RE38,551., titled Anticonvulsant enantiomeric amino acid derivatives. The ‘551 patent covers lacosamide, an anti-epileptic drug for the treatment of epilepsy and other central nervous system disorders. UCB holds New Drug Applications (“NDAs”) that cover its lacosamide anti-epileptic drug approved by the Food and Drug Administration (“FDA”) and marketed under the tradename Vimpat®. The ‘551 patent is listed in the FDA’s Approved Drug Products With Therapeutic Equivalence Evaluations (“Orange Book”) as covering Vimpat®.

Appellants were generic drug manufacturers who filed Abbreviated New Drug Applications (“ANDAs”), seeking approval for generic versions of Vimpat®. Pursuant to applicable Hatch-Waxman provisions, Appellants certified in their ANDAs that the ‘551 patent was invalid, unenforceable, or that their proposed generic lacosamide products would not infringe the ‘551 patent.

Consequently, as is their right under Hatch-Waxman, UCB sued Appellants for patent infringement in the United States District Court for the District of Delaware. Appellants stipulated to infringement of claims 9, 10, and 13 of the ‘551 patent but maintained that these claims are invalid for obviousness-type double patenting, obviousness, and anticipation.

Following a bench trial, the district court made exhaustive fact findings based on the trial evidence and concluded that the asserted claims of the ‘551 patent were not invalid. Appellants appealled that decision, arguing that the district court misapplied the legal standards for obviousness-type double patenting, obviousness, and anticipation, and that the prior art anticipates and/or renders the ‘551 patent obvious.

The Federal Circuit held that the district court applied the correct legal standards in its obviousness-type double patenting, obviousness, and anticipation analyses, and found no clear error in its underlying factual findings. As a result, the Federal Circuit affirmed the district court’s ultimate conclusion that the asserted claims were not invalid.

Apple, Samsung Settle Patent Litigation

On June 27, 2018, Apple and Samsung settled their patent dispute.

A dismissal filed in Delaware ended a small chapter of the Apple/Samsung patent war. The docket in that case included only 18 items and the case had been stayed since August 2011 after Samsung brought patent infringement claims against Apple to the U.S. International Trade Commission. The dismissal terminating the Northern California case ended the much more contentious portion of the patent battle between these two companies. The dismissal is the penultimate filing in that case which involved a total of 3,956 docket entries filed with the district court alone.

The Northern California dismissal had the result of denying as moot various motions filed by either Samsung or Apple which were still pending at the time that the parties entered into the settlement. These included a motion filed by Apple for supplemental damages, pre-judgment interest and post-judgment interest, which was filed only on June 7th. This motion followed the district court’s previous ruling that an award of supplemental damages was necessary to compensate Apple for infringing sales not considered by the jury. The calculation of the supplemental damages award took August 25th, 2012, as the date from which to begin the calculation; this date was the day after the first jury verdict was entered in the case. Apple’s entitlement to supplemental damages was reiterated by the district court after a damages retrial that occurred in 2013. Apple argued in its motion that Samsung had waived any right to challenge Apple’s entitlement to compensation for additional infringing sales and that Samsung had admitted to continuing to sell six infringing models after the August 2012 jury verdict.

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USAA Asserts Mobile Check Deposit Patents Against Wells Fargo

On June 7th, San Antonio, TX-based reciprocal inter-insurance exchange United Services Automobile Association (USAA) filed a lawsuit alleging claims of patent infringement against San Francisco, CA-based financial services multinational Wells Fargo. The complaint, filed in the Eastern District of Texas, involves the assertion of patents in the field of mobile financial services which, at first glance, appear as though they may face some rigorous validity challenges thanks to precedent set by the U.S. Supreme Court in its 2014 decision in Alice Corp. v. CLS Bank International.

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PTO Proposes to Eliminate BRI at PTAB

The USPTO recently announced proposed rulemaking that would change the prior policy of using the Broadest Reasonable Interpretation (“BRI”) standard for construing unexpired and proposed amended patent claims in PTAB proceedings under the America Invents Act and instead would use the Phillips claim construction standard. The new standard proposed by the USPTO is the same as the standard applied in Article III federal courts and International Trade Commission (“ITC”) proceedings, a change critics of the PTAB process have urged for many years in order to bring uniformity to post grant challenges across forums.

“Having AIA trial proceedings use the same claim construction standard that is applied in federal district courts and ITC proceedings also addresses the concern that potential unfairness could result from using an arguably broader standard in AIA trial proceedings,” the NPRM says. “Under the proposed approach, the Office would construe patent claims and proposed claims based on the record of the IPR, PGR, or CBM proceeding, taking into account the claim language itself, specification, and prosecution history pertaining to the patent. The Office would apply the principles that the Federal Circuit articulated in Phillips and its progeny.”

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PTAB Fails to Consider Arguments in Reply Brief

On Friday, June 1st, the Court of Appeals for the Federal Circuit issued a decision in In re: Durance striking down a decision by the Patent Trial and Appeal Board (PTAB) that affirmed a patent examiner’s obviousness rejection of a microwave vacuum-drying apparatus and associated method. The Federal Circuit panel consisting of Judges Alan Lourie, Jimmie Reyna and Raymond Chen determined that the PTAB erred in not considering arguments offered in the patent applicant’s reply brief, which were properly made in response to the examiner’s answer.

In September 2014, the examiner issued a final rejection, which rejected all 37 claims of the patent application on 35 U.S.C. § 103 for obviousness and 35 U.S.C. § 112 for not meeting the written description requirement and lack of enablement. The obviousness finding was based on two pieces of prior art: U.S. Patent No. 6442866, titled Method and Apparatus for Drying or Heat-Treating Products (“Wefers”) and issued in September 2002; and U.S. Patent Application No. 20050019209, titled Method and Device for Sterilizing Containers (“Burger”) and filed in July 2002. The examiner rejected most of the ‘895 patent applications claims after finding that Wefers disclosed every limitation of claim 1 except for the tumbling limitation, which was itself disclosed by Burger. The examiner rejected Durance’s argument that rotating the container to enhance tumbling of the organic material was not present in the Wefers and Burger combination; the examiner found that the organic material’s tumbling was an inherent function of all rotating containers. On the indefiniteness finding, the examiner found that the patent application’s specification did not meet the written description requirement under Section 112 because it did not discuss the rotational speed necessary to tumble the organic material.

After an examiner interview in December 2014, the examiner withdrew the rejection based on the Section 112 grounds but maintained the obviousness rejection based on Burger’s teaching of a transportation means rotating a container through a vacuum chamber from the inlet to the outlet. Durance appealed to the PTAB, arguing that Burger taught the application of plasma to the surface of containers and not the rotation of the containers to tumble the contents for balancing out the microwave radiation applied to the cylinders. Durance further argued that Wefers taught away from agitating products during transportation because it stressed the “gentle continual transport” needed to reduce maintenance expenses. The examiner answered this argument based on new grounds that there was no structural difference between Durance’s claimed invention and the combination of the prior art references. Although Durance argued that the examiner’s understanding of structural identity for rejection, which had never before been articulated, was extremely inaccurate as the claimed invention in the ‘895 patent application required the use of gears, not simply gravity. The PTAB sided with the examiner, finding that Durance’s arguments only addressed individual references and not the combination.

Durance appealed for rehearing by the PTAB, arguing that the Board erroneously ignored reply brief arguments related to the structural identity rejection. In not addressing arguments that the claimed structure is different than the Burger structure, the PTAB “misapprehend[ed] the law” on inherency by ignoring the argument that structural identity cannot be used to show that a method claim is inherently performed by a combination of prior art references. In denying the request for rehearing, the PTAB stated that it did not misapprehend the doctrine on inherency because it didn’t invoke that doctrine in affirming the examiner’s rejection. “In the interest of fairness,” the Board did consider Durance’s reply brief argument that the amount of material packed into the container affects whether the material would tumble, but the Board reiterated that it would not consider other reply brief arguments.

On appeal to the Federal Circuit, Durance argued that substantial evidence doesn’t support the PTAB’s finding that the combination of the prior art references taught the tumbling limitation either expressly or inherently. Durance also argued that the PTAB lacked substantial evidentiary support to show that a skilled artisan would modify Wefers to include the rotation feature disclosed by Burger.

In its discussion of the issues in the appeal, the Federal Circuit opined that “the Court is not confident in the Patent Office’s reasoning for its rejection of the Application” based upon the shifting arguments offered in the patent examiner’s rejections, as well as the PTAB’s argument on appeal that the Federal Circuit should find inherency in the first instance after the PTAB told Durance that inherency was never invoked. In analyzing 37 C.F.R. § 41.41(b), the relevant statute under which the PTAB waived Durance’s reply brief arguments, the Federal Circuit noted that the statute allows a patent owner to include responses to an examiner’s answer in a reply brief. Nothing in the statute bars the patent owner from addressing new arguments made by the examiner that were not articulated in the Final Office Action, the appellate court found.

The PTAB’s refusal to consider Durance’s reply brief arguments on structural dissimilarity between the patent application and the prior art references required vacating the agency’s decision and remanding the case back to the Board, the Federal Circuit held.