Fresh From the Bench: Precedential Patent Cases From the Federal Circuit

by Schwabe, Williamson & Wyatt PC

Schwabe, Williamson & Wyatt PC

In EmeraChem v Volkswagen the Circuit reverses a determination of obviousness because the ‎Board did not provide the patentee with an adequate opportunity to address a prior art reference ‎that formed a principal basis for its obviousness ruling. The Circuit affirms the invalidation of ‎three Cleveland Clinic patents in Cleveland Clinic Foundation v. ‎True Health, ruling that claims ‎directed to diagnostic tests merely recite laws of nature.‎ In Outdry v. Geox, the Circuit affirms a ‎Board holding that claims of Outdry’s patent directed to methods for ‎waterproofing leather ‎would have been obvious.‎

Thanks to my colleagues Ian Griswold, Martin Garthwaite and Jeff Marlink for helping with this ‎report.‎


EmeraChem v. Volkswagen, Fed. Cir. Case 2016-1984 (June 15, 2017)‎

In affirming in part and reversing in part, the Circuit rules that the Administrative Procedure Act ‎requires that the patentee be given an opportunity to respond to arguments the Board makes in ‎cancelling claims directed to exhaust treatment catalysts used in diesel engines. ‎

EmeraChem presented two arguments on appeal. First, EmeraChem argued that one of the cited ‎references (Campbell) did not qualify as prior art under 35 U.S.C. § 102(e) because it was not ‎invented “by another.” Of the four inventors listed in the Campbell reference, two of the ‎inventors (including Campbell) were also listed as inventors in the patent in question. ‎EmeraChem’s argument relies on a declaration of Campbell stating that the two common ‎inventors are the sole inventors of the portions of the Campbell reference used for the ‎obviousness rejection of the claims.‎

The Circuit notes that, for a prior art reference to be disqualified under ‎§‎ 102(e), an ‎uncorroborated declaration by an interested party is insufficient to show that portions of the ‎reference relied on as prior art and the claims in question represent the work of a common ‎inventive entity. For example, EmeraChem did not call on the non-common inventors to testify ‎as to the credibility of the declaration, and the declaration was made at least twenty years after ‎the time of conception.

Regarding EmeraChem’s second argument, as to sufficient notice, EmeraChem asserts that ‎adequate notice was not provided for one of the references (Stiles) being used to challenge ‎claims 3, 16, and 20 for obviousness. In particular, EmeraChem asserts that Volkswagen’s ‎pleading did not indicate that Stiles was being used to challenge the obviousness for those claims ‎and, therefore, EmeraChem did not have an opportunity to respond to the grounds of the ‎obviousness challenge.‎

While Volkswagen’s pleading included a general statement that all the claims were challenged ‎over a list of references including Stiles, Volkswagen’s claim chart detailing the rejections of ‎each of the claims did not indicate that Stiles was being used to challenge claims 3, 16, and 20. ‎Further, the Circuit notes that the Board’s Institution Decision included a claim-by-claim listing ‎of the specific prior art references for which it was instituting review, and Stiles was not listed as ‎being used for the review of those claims. Based on these reasons, the Circuit finds that ‎EmeraChem was not provided with sufficient notice and the opportunity to respond. ‎

Read the full opinion

The Cleveland Clinic Foundation v. True Health Diagnostics LLC, Fed. Cir. Case 2016-1766 ‎‎(June 16, ‎‎2017)‎

The Circuit affirms the invalidation of three Cleveland Clinic Foundation patents directed to ‎diagnostic tests to detect the presence of an ‎enzyme the body releases when there is arterial ‎‎damage, ruling that the claims merely recite laws of nature. The panel also upholds the lower ‎court’s dismissal of claims of contributory or induced infringement as to a fourth patent for a ‎treatment method involving administration of a lipid-lowering agent.‎

In keeping with its recent cases, the Circuit finds that the claims recite the relationship between ‎MPO levels in the bloodstream and the risk of having or developing cardiovascular disease ‎without anything more that would render the claims patent-eligible. The “determining” steps in ‎the claims call for determining the MPO mass or activity level from the blood sample by ‎whatever method the user chooses, and well known techniques existed for these “determining” ‎steps. The process steps merely inform those “interested in the subject about the correlations that ‎the researchers discovered.” ‎

Citing its Ariosa Diagnostics v. Sequenom case, the Circuit emphasizes the difference between ‎inventions that cover diagnosing or observing natural phenomena, which aren’t patentable, and ‎patents on new techniques that harness those observations. The opinion distinguishes the claims ‎at issue from those in Rapid Litigation Management v. CellzDirect, where the patent didn’t cover ‎just observations about the ability of liver cells to survive freeze-thaw cycles, but instead ‎disclosed new and useful laboratory techniques for preserving the cells. This leaves open a very ‎narrow door for the patentability of diagnostics patents.‎

The fourth patent in suit builds upon the three diagnostic patents but requires “administering a ‎lipid lowering agent to the selected human patient.” The panel agrees with the lower court that ‎the Foundation fails to state a claim for contributory infringement because it did not identify any ‎‎“material or apparatus” sold by True Health. Moreover, the manner in which defendant reports ‎the results of the service it provides does not constitute a “material or apparatus” for purposes of ‎a contributory infringement claim. With respect to induced infringement claim, the Foundation ‎alleges no facts that suggest any connection between True Health and doctors that may prescribe ‎lipid lowering drugs, and thus falls short of showing “specific intent and action” to induce ‎infringement. ‎

Read the full opinion

Outdry v. Geox, Fed. Cir. Case 2016-1769 (June 16, 2017)‎

The Circuit affirms a Board holding that claims of Outdry’s patent directed to methods for ‎waterproofing leather would have been obvious, ruling that the Board sufficiently articulated ‎why a person of ordinary skill in waterproofing leather would be motivated to combine the prior ‎art. Also, the motivation supported by the record and found by the Board need not, according to ‎the opinion, be the same ‎motivation articulated in the patent for making the claimed combination. ‎Finally, the panel agrees with the Board as to the broadest reasonable interpretation of “directly ‎pressing,” and holds that the preamble clause “process for waterproofing leather” is not a separate ‎limitation.‎

Regarding claim construction of the term “directly pressing,” the Circuit agrees with Geox that ‎the specification does not suggest that the process must form a uniform, sealed sheet of ‎waterproof leather because the specification does not disclose a required degree of contact ‎between the membrane and the leather in the regions that are between dots of adhesive. ‎

As to the preamble phrase “process for waterproofing leather,” the panel rules that this is not a ‎separate limitation that must be disclosed in the prior art in order to support the Board’s ‎obviousness determination. According to the opinion, satisfaction of the claimed steps in the ‎body of the claim necessarily results in satisfying a “process for waterproofing leather.”‎

Comment: In its opinion the panel attempted to distinguish many other Circuit decisions in the ‎past year that the Circuit has remanded based on the Board failing to follow KSR’s admonition ‎that the basis for the motivation to combine must be explained. See In re Van Os, 844 F.3d 1359 ‎‎(Fed. Cir. 2017)‎; Rovalma v. Bohler-Edelstahl, Fed. Cir. Case 2016-2233 (May 11, 2017)‎; ‎PersonalWeb Tech. v. Apple, 848 F.3d 987 (Fed. Cir. 2017); Icon Health & Fitness v. Strava, 849 ‎F.3d 1034 (Fed. Cir. 2017); ‎In re NuVasive, 842 F.3d 1376 (Fed. Cir. 2016); Apple v. Samsung, ‎‎839 F.3d 1034 (Fed. Cir. 2016) (en banc).and In re Warsaw ‎Orthopedic, 832 F.3d 1327 (Fed. ‎Cir. 2016).

Read the full opinion

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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