Ecolochem, Inc. v. Southern California Edison Co., 227 F.3d 1361 (Fed. Cir. 2000).

Facts:

Ecolochem owned two patents directed to methods of demineralization and deoxygenation of water. Ecolochem developed the underlying technology while contracting its water purification and supply services to Southern California Edison Company. Edison at the time was constructing its own water purification facility. Ecolochem filed suit against Edison upon completion of the project, alleging that Edison’s facility infringed Ecolochem’s patents. The district court granted partial summary judgment in favor of Edison and held that the claims of the two patents were invalid as either anticipated or obvious.

On appeal, the Court of Appeals for the Federal Circuit reversed and remanded for retrial, holding that disputed issues of material fact remained pertaining to evidence of secondary indicia of nonobviousness presented by Ecolochem.

Following a bench trial on remand, the district court found that Edison had willfully infringed Ecolochem’s patents. The court also found, however, that the infringed claims were invalid as obvious in light of a combination of prior art including references that taught the use of mixed-bed ion exchange resins. Ecolochem appealed the finding of invalidity regarding the claims of the ‘411 patent but did not assert the other patent on appeal.

Issues:

1. Whether process patent claims are anticipated by prior art articles or by a scientist’s public presentation if the entire process is not fully described in any one reference.

2. Whether an invention that combines two known elements is obvious when nothing in the prior art as a whole suggests, teaches, or motivates one of ordinary skill in the art to make the combination.

3. Whether evidence of secondary considerations can rebut a prima facie case of obviousness and raise a genuine issue of fact that requires a remand for trial of the issue.

Holding:

1. No. Prior art references that do not expressly teach each and every element of the process described in a patent do not anticipate the patent.

2. No. Obviousness cannot be established by combining the teachings of the prior art unless the prior art contains a teaching, suggestion or motivation to combine.

3. Yes. Evidence of secondary indicia of nonobviousness may raise a material issue of fact necessitating a remand for trial on the issue.

Discussion:

The Court of Appeals for the Federal Circuit reviewed de novo the district court’s finding that the claims were obvious and invalid. The court noted that the prior art taught the use of hydrogen to deoxygenate water but did not teach the deoxygenation of water using hydrazine with mixed-bed ion exchange resins. With the exception of claim 20, the court reversed the district court’s finding that Ecolochem’s claims were anticipated by a scientist’s public presentation because a key part of the claimed process had been omitted from the presentation. The court found that the presentation included every limitation of claim 20 and affirmed the district court’s finding of invalidity regarding that claim.

The court held that the combination of two prior art references does not render patent claims obvious absent a teaching, suggestion, or motivation to combine the information and where there was evidence of teaching away in the prior art. Here, the court held that the prior art taught away from the mixed-bed ion exchange process and that the claims were therefore not obvious in light of secondary indicia of nonobviousness.

The Federal Circuit considered evidence of secondary indicia of nonobviousness offered by Ecolochem to overcome a prima facie showing of obviousness for claim 20 and affirmed the district court’s determination that the claim was obvious. The court reasoned that the lack of evidence of copying by others in addition to evidence that showed that Ecolochem’s process was not developed in response to a “long felt need” pointed more strongly toward a finding of obviousness than commercial success and teaching away supported the opposite conclusion.

Disposition:

Affirmed with regard to the district court’s finding that claim 20 was invalid, reversed with respect to all of the other claims, and remanded for a determination of damages to Ecolochem for infringement of the remaining valid claims.

Tags: anticipation, Cases, Cases, court, fpost, intellectual property, law, lawsuit, litigation, obviousness, Patent, trial, TSM test

3D Systems, Inc. v. Aarotech Labs., Inc., No. 97-1514, 1998 U.S. App. Lexis 28583, 160 F.3d 1373, 48 U.S.P.Q.2d (BNA) 1773 (Fed. Cir. Nov. 12, 1998).

Facts:

3D Systems filed a patent infringement suit against Aarotech, Aaroflex, and Young in the Central District of California. The defendants moved to dismiss for lack of personal jurisdiction. The district court granted the motion and dismissed the claims against all of the defendants, finding that the plaintiff had not established the elements for personal jurisdiction under the Ninth Circuit’s due process test.

Aarotech, the parent corporation of Aaroflex, was incorporated in Oklahoma and had its principle place of business in Virginia but had taken no actions in the state of California.

Aaroflex, a subsidiary of Aarotech, was incorporated in West Virginia and had its principle place of business in Virginia. As of the date of the district court’s decision, Aaroflex had sold a total of five machines, none of which had been shipped, and none of which had been sold in California. Promotional materials had been distributed in California, however.

Young was the President and Chairman of the Board of Aaroflex and the CEO of both Aaarotech and Aaaroflex and resided in Washington, DC.

Issue:

1) What personal jurisdiction law does the Federal Circuit apply – its own or that of the lower court?
2) Were Aaroflex’s promotional materials and price quotations offers for sale under 35 U.S.C. § 271(a), despite stating that they were not an offer for sale until executed by recipient?

Holding:

1) The Federal Circuit applies its own personal jurisdiction law, deferring to the state’s highest court’s interpretation of the state’s long arm statute.
2) Yes. Using the conceptualization of “offer to sell” under federal law and not the law of the state, the promotional materials were an offer for sale.

Discussion:

The Federal Circuit applied the Akro test for minimum contacts (see Akro Corp. v. Luker, 45 F.3d 1541, 1545-46, 33 U.S.P.Q.2d 1505, 1508-09 (Fed. Cir. 1995)). The three prongs of the Akro test are:

1) whether the defendant purposefully directed its activities at the forum,
2) whether the claim arises out of or relates to those activities, and
3) whether an assertion of personal jurisdiction is reasonable and fair.

Whether the second prong had been satisfied depended on whether the promotional materials constituted an offer for sale. The Federal Circuit held that “offer to sell” under 35 USC § 271 was intended to prevent potential infringers from generating interest in an infringing product to the detriment of the patentee. The Federal Circuit held that the promotional materials constituted offers for sale and that minimum contacts had been established, and that therefore the district court had had personal jurisdiction over Aaroflex. See International Shoe Co. v. Washington.

Disposition:

Affirmed-in-part as to the district court’s finding that it lacked personal jurisdiction over Aarotech and Young, reversed-in-part as to the district court’s finding that it lacked personal jurisdiction over Aaroflex, and remanded.

Tags: 35 usc 271, Cases, Cases, law, Patent, patents, personal jurisdiction

In re Brana, 51 F.3d 1560 (Fed. Cir. 1995).

Facts:

Brana filed a patent application directed to antitumor compounds. The compounds were very similar to other known antitumor compounds but had not been tested in human subjects. The known compounds had been evaluated using a computer test that was used to identify compounds as candidates for further testing by the National Cancer Institute. The National Cancer Institute then performed in vitro tests for antitumor activity against human tumor cells, and in vivo tests for efficacy against two lymphatic leukemias in mice. The patent application pointed out the similarity between the claimed compounds to the known antitumor compounds and demonstrated the cytotoxicity of the compounds against human tumor cells in vitro.

The examiner rejected the application on the grounds that the application failed to specify a specific disease against which the compounds were effective, and because the test results were insufficient to establish that there was a reasonable expectation that the compounds had a practical utility. On appeal, the Board of Patent Appeals and Interferences affirmed the examiner’s rejection.

Issue: The issue is what the applicant must prove regarding the practical utility or usefulness of pharmaceutical inventions.

Holding: The court held that while the examiner’s rejection and the Board of Patent Appeals and Interferences decision appeared to be based on the issue of whether the compounds had a practical utility, the real issue pertained to the requirements for patentability under 35 USC 112 p 1. The court considered two issues.

Specific Utility:

The first basis for the Board’s decision was that the application had failed to disclose that the compounds were active against a specific disease and that one of ordinary skill in the art would be unable to use the invention without undue experimentation. (See Hybritech Inc. v. Monoclonal Antibodies, Inc.)

The court held that the applicants’ favorable comparison to the compounds with known activity implicitly asserted that the claimed compounds were highly effective against lymphocytic leukemia and therefore useful. In light of the comparison to the known compounds, the court held that the specification alleged a sufficiently specific use. The court held that while the tumors were man made, they nevertheless represented real tumors and it was unnecessary to wait for them to occur naturally.

Utility:

The Board also affirmed the rejection of the claims on the basis that even if the specification disclosed a specific utility, the application did not prove that the claimed compounds are useful. The court held that the PTO has the initial burden to make a prima facie showing that the invention lacks utility. The PTO must challenge the application’s presumptively correct utility disclosed in the application. Only after the PTO has provided evidence that one of ordinary skill in the art would reasonably doubt the asserted utility does the burden shift to the applicant to provide evidence sufficient to convince such a person of the invention’s asserted utility. The court found that the PTO failed to make a prima facie showing that the invention lacked the asserted utility and that the applicants should not have been required to substantiate their disclosure to avoid the rejection. The court also found that even if the PTO had meet this initial burden, the applicants submitted sufficient evidence to convince one of skill in the art of the asserted utility. The court noted that the requirements to obtain the approval to market a drug are not the same as the requirements to obtain a patent. The court stated that

[u]sefulness in patent law, and in particular in the context of pharmacological inventions, necessarily includes the expectation of further research and development. The stage at which an invention in this field becomes useful is well before it is ready to be administered to humans. Were we to require Phase II testing in order to prove utility, the associated costs would prevent many companies from obtaining patent protection on promising new inventions, thereby eliminating an incentive to pursue, through research and development, potential cures in many crucial areas such as the treatment of cancer.

The court also reaffirmed that proof of an alleged pharmaceutical property for a compound through statistically significant tests using standard laboratory animals is sufficient to establish utility. Namely, one who has taught the public that a compound exhibits some desirable pharmaceutical property in a standard laboratory animal has made a significant and useful contribution to the art, even though it may eventually appear that the compound is without value in the treatment of humans. (See In re Krimmel.)

Disposition: Reversed.

Tags: 35 USC 112, case, Cases, Cases, chemical, drug, law, Patent, pharmaceutical, utility