In Institut Pasteur v. Focarino, the Federal Circuit found that the obviousness determination by the USPTO Board of Patent Appeals and Interferences was not supported by substantial evidence, and rested on an “erroneous obviousness analysis.” It dismissed the appeal as to one patent, however, because it was amended during reexamination and expired during the pendency of the appeal.
The Patents at Issue
There were three Institut Pasteur patents at issue: U.S. 7,309,605; U.S. 6,610,545, and U.S. 6,833,252. As summarized by the court, the patents relate to “methods and tools for the site-directed insertion of genes into eukaryotic chromosomes.” For example, claim 7 of the ’545 patent recites:
7. A method for in vivo site directed genetic recombination in an organism comprising:
(a) providing a transgenic eukaryotic cell having at least one Group I intron encoded endonuclease recognition site inserted at a unique location in a chromosome;
(b) providing an expression vector that expresses said endonuclease in said transgenic cell;
(c) providing a plasmid comprising a gene of interest and a DNA sequence homologous to the sequence of the chromosome, allowing homologous recombination;
(d) transfecting said transgenic cell with said plasmid of step (c);
(e) expressing said endonuclease from said expression vector in said cell; and
(f) cleaving said at least one Group I intron encoded endonuclease recognition site with said endonuclease,
whereby said cleavage promotes the insertion of said gene of interest into said chromosome of said organism at a specific site by homologous recombination.
Dependent claims 10 and 12, at issue on appeal, recite yeast and mammalian cells, respectively.
Precision BioSciences had requested inter partes reexamination of the patents, and the USPTO examiner held some of the challenged claims obvious. The Board affirmed the rejections on appeal.
The ’605 Patent
The ’605 patent expired while the Federal Circuit appeal was pending. The court dismissed the appeal as to that patent as moot, explaining:
[T]he PTO may not issue the amended claim now that the patent has expired, as stated in applicable provisions of a PTO regulation, 37 C.F.R. § 1.530(j), (k). That rule follows from the relevant statutory provisions. Looking backward, if the claim were to issue on reexamination, Pasteur could not enforce it for the period before issuance of the reexamination certificate. That is because, for inter partes reexaminations under the pre-2013 version of 35 U.S.C. § 316(b) applicable here, as for reissues under 35 U.S.C. § 252, when a claim is substantively amended, the analysis of intervening rights after issuance … treats the amendment as raising an irrebuttable presumption that the original claim was materially flawed, so there can be no liability for acts of infringement before the amended claim issues.
The ’545 Patent
As framed in the Federal Circuit decision, the obviousness of claims 10 and 12 of the ’545 patent turned on the following issue:
[W]hether the relevant skilled artisan–after reading Quirk’s and Bell-Pedersen’s disclosure that a GIIE endonuclease can promote targeted gene transfer into non-chromosomal DNA in prokaryotic cells–would have expected that a GIIE endonuclease would successfully promote targeted gene transfer into the chromosomal DNA of eukaryotic cells, and thus had good reason to pursue that possibility.
The Federal Circuit analyzed the issue under its “reasonable expectation of success” test, noting that the Supreme Court’s discussion in KSR of “predictable solutions” and “anticipated success” was consistent with the Federal Circuit’s “longstanding” focus.
The court found factual and legal errors in the Board decision of obviousness.
Factually, the court found that “the Board erred in finding that two references in the prior art, Frey and Dujon, ‘showed that a GIIE endonuclease cleaved yeast chromosomal DNA when expressed in yeast cells.’ …. In fact, neither reference discloses a GIIE endonuclease cleaving yeast chromosomes while those chromosomes are in yeast cells.” The noted that “[t]he Board relied on its misreading of both references, and nothing more, to conclude that ‘one of ordinary skill in the art [had] a reasonable expectation that the teachings of Quirk and Bell-Pedersen could be successfully applied to yeast cells.’…. Because no other references identified by the Board show a GIIE endonuclease cleaving chromosomal DNA in a eukaryotic cell, its errors were highly material to whether the ’545 patent claims would have been obvious.”
Legally, the court found that “[t]he Board compounded its erroneous findings by ignoring teachings that targeting a GIIE endonuclease to chromosomal DNA in a living cell could be highly toxic to the cell.” As summarized by the court:
The sole prior-art reference identified by the Board that discloses such a method warns of such dangers: a 1990 article in Nucleic Acids Research specifically teaches that introducing a GIIE endonuclease could be “highly toxic” to the cell, which might not be able to repair double-stranded breaks in the chromosome using homologous recombination. …. Such a teaching counts significantly against finding a motivation to take the claimed steps with a reasonable expectation of success.
The court found that “[t]he Board’s disregard of the toxicity teaching was not harmless.” Moreover, “the Board identified no reason at all that a skilled artisan would have pursued a method toxic to cells.” Thus, [t]he Board … erred by disregarding evidence of toxicity of the method at issue.”
Summarizing its conclusions on this issue, the court acknowledged that “the prior art confirmed the great potential payoff” of the methods at issue, but emphasized that “knowledge of the goal does not render its achievement obvious.” The court reiterated that “obviousness generally requires that a skilled artisan have reasonably expected success in achieving that goal,” and emphasized that “the expectation-of-success analysis must match the highly desired goal, not switch to a different goal that may be a less challenging but also less worthwhile pursuit.”
Objective Indicia of Non-Obviousness
The court also found error in the Board’s failure to give weight to the evidence of substantial licensing as objective indicia of non-obviousness.
According to the court, the Board “rejected the evidence because ‘Dr. Choulika did not establish that the third parties specifically licensed the patent family to gain access to the subject matter claimed in the ’545 patent, rather than other technology described in the patent but not claimed or claimed in related patents.’” The court disagreed with the Board’s analysis, finding that “that theoretical possibility does not undermine the strong probative value of the licensing of the ’545 patent. The central success described in the patent is the one prior art hoped for and is captured in the claims at issue…. Pasteur’s licensing activities provide ‘probative and cogent evidence’ of non-obviousness of the claims at issue.”
The court therefore reversed the rejections of claims 10 and 12 of the ’545 patent. The issues surrounding the ’252 patent were similar, but because the ’252 patent claims required “less” than the ’545 patent claims, the court remanded that patent to the Board to determine whether there was sufficient motivation and expectation of success with regard to the specific methods claimed in the ’252 patent.
Challenging Board Decisions
As the court here noted, the Board’s factual determinations are reviewed under a “deferential” standard. Although challenging a Board decision on this basis can be an uphill battle, this case and other recent decisions overturning Board factual findings show that the Federal Circuit will reverse the Board if it cannot find substantial evidence to support the Board decision, or if the Board decision rests on legal errors.