In USPTO v. Bilski, U.S. Supreme Court confronted us with a “fuzzy” composite of opinions about the standard for patent-eligibility under 35 U.S.C. § 101. See Through the Fuzzy Bilski Looking Glass: The Meaning of Patent-Eligible under 35 U.S.C. § 101 where I noted five key “takeaways” from those composite opinions, including what to make of Justice Scalia joining the Opinion of the Court except for Part II B-2 and C-2. The Federal Circuit is also not immune from composite opinions that make you scratch your head as to what the final ruling is. See Ariad Pharmaceuticals, Inc. v. Eli Lilly & Company where an en banc ruling by the Federal Circuit on whether there is a separate “written description” requirement under 35 U.S.C. § 112, first paragraph, spawned (in addition to the Opinion of the Court), four additional concurring and dissenting-in-part opinions. In affirming the judgment of the district court “by an equally divided court,” the recently issued Marine Polymer Technologies, Inc. v. Hemcon, Inc. case requires yet some more figuring about another “muddled” Federal Circuit en banc decision.
The “muddle” that became the en banc decision in Marine Polymer revolved around two primary questions: (1) the meaning of the claim term “biocompatible”; and (2) when does “intervening rights” apply to reexamined claims? See CAFC: Intervening Rights for Claims Unamended During Reexam* where I discussed both of these questions in the Federal Circuit panel decision in Marine Polymer. In the en banc decision, and by a 5 “yea” to 5 “nay” vote (with Judges Moore and O’Malley not taking part), the Federal Circuit deadlocked over the district court’s interpretation of “biocompatible” to mean “low variability, high purity, and no detectable biological reactivity as determined by biological reactivity as determined by biocompatibility tests.” In jurisprudential parlance, such a “tie vote” means the district court interpretation prevails by default.
On September 26, 2011, the a three-judge-panel of the United States Court of Appeals for the Federal Circuit issued a ruling in Marine Polymer Technologies, Inc. v. HemCon, Inc., which found intervening rights due to certain patent claims due to the fact that Marine Polymer made arguments about claim language during reexamination, but without actually amending the claims. See Marine Polymer vacated opinion. On January 20, 2012, the full Federal Circuit decided to hear this case en banc and ordered that the original panel decision be vacated and the appeal reinstated. No additional briefing by the parties was requested, but on January 26, 2012, the Federal Circuit issued an Order allowing amicus briefs to be filed on or before February 10, 2012. On February 10, 2012 the Biotechnology Industry Organization and Pharmaceutical Research and Manufacturers of America filed a joint Amici Curiae Brief supporting the appellee and seeking affirmance of the district court decision.
Before getting into the arguments made by the Bio/Pharma brief, let’s go over the now vacated original panel decision to set the table.
Companies accused of patent infringement are increasingly looking at patent reexamination at the Patent Office as an attractive avenue for challenging the patent’s validity. Reexamination offers a number of well-known advantages as a forum for such validity challenges over District Court, among them the absence of a presumption of validity and a lower burden of proof. Less well-known, however, is the potential for reexamination to eliminate an accused infringer’s liability for past damages – even if the PTO confirms the validity of a patent in reexamination, the accused infringer might be entitled to “intervening rights,” effectively eliminating past damages, if the patent owner amends its claims to distinguish its invention over the prior art. Even when the patent owner succeeds in the reexamination, if it also amends its claims, it can lose its right to collect damages for infringement occurring prior to the end of the reexamination.
This possibility of “intervening rights” received a big boost last week with the CAFC’s decision in Marine Polymer Techs. v. HemCon, finding that such rights may be created even without an amendment of the claims if the patent owner presents arguments in reexamination that “effectively amend” the claims.
CAFC Rules “Intervening Rights” May Be Based on Arguments Even Though Claims Unamended During Reexamination.
I like writing about esoteric patent law topics and the question of “intervening rights” in reexaminations/reissues is one of the more esoteric. See my 1998 JPTOS article entitledIntervening Rights: A Potential Hidden Trap for Reexamined Patent. The case of Marine Polymer Technologies, Inc. v. HemCon, Inc. is one of those rare instances in this esoteric area of patent law where the Federal Circuit announced a new “wrinkle” on when “intervening rights” apply in reexamination. Unfortunately, the rule announced by the majority in Marine Polymer Technologies (“intervening rights” apply to unamended claims based on statements made during reexamination) is squarely in conflict with the express language of 35 U.S.C. § 307(b), as Judge Lourie’s dissent vigorously (and more importantly, correctly) points out.
Last week, on November 18, 2010, the United States Court of Appeals for the Federal Circuit granted a stay to HemCon, Inc., which will prevent implementation of the injunction issued against it and in favor of Marine Polymer Technologies, Inc. The stay will remain in effect during the pendency of HemCon’s appeal to the Federal Circuit. The stay issued by the Federal Circuit will allow the adjudicated infringing bandages sold by HemCon to continue to be supplied to the United States Military.
The permanent injunction had been awarded by the United States Federal District Court for the District of New Hampshire, and relates to U.S. Patent No. 6,864,245, for Biocompatible poly-?-1?4-N-acetylglucosamine. In essence, the ’245 patent relates to a polymer of high molecular weight that is free of proteins and substantially free of organic and inorganic contaminants. The biodegradable barriers of the invention include p-GlcNAc based materials used for temporary barriers which become resorbed by the body. Products that prevent the formation of surgical adhesions, stop bleeding, and promote wound healing are contemplated by the ’245 patent.