Federal Circuit Appeals

In two recent decisions, both issued on February 4, 2022, the United States Court of Appeals for the Federal Circuit (the “CAFC”) erased two huge patent damages awards because the underlying expert opinion on damages was untethered to the specific facts of each case.

On February 8, 2022, U.S. District Court Judge Maryellen Noreika of the United States District Court for the District of Delaware granted the plaintiff’s motion to exclude defendant’s expert testimony for being “based on an erroneous legal theory” in a suit alleging defendants’ proposed generic Abbreviated New Drug Application (“ANDA”) product would infringe Exela’s patents under the Hatch-Waxman Act. Judge Noreika’s decision in this case reinforces the Federal Circuit’s holding in Sunovion and serves as a reminder that ANDA product infringement is primarily assessed by comparing the asserted claims with the ANDA specification, rather than other ANDA submission materials further describing the ANDA product.

The Federal Circuit decision in Uniloc USA, Inc. et al. v. Apple, Inc., where a 2-1 panel ruled that the district court had abused its discretion by refusing to seal certain patent-licensing documents provided by plaintiffs, Uniloc USA, Inc. and Uniloc Luxembourg, S.A., demonstrates the Federal Circuit’s recognition of the importance of keeping certain patent licensing and other trade secret materials confidential.

The Federal Circuit recently provided strategic guidance for defending software claims against Alice challenges that claims recite ineligible patent subject matter under 35 U.S.C. § 101. In Mentone Solutions LLC v. Digi International Inc., defendants alleged that representative claim 5 of U.S. Patent No. 6,952,413, directed towards allocating data channels using shifted uplink status flags in cellular mobile stations, claimed only an abstract idea. The District Court agreed and dismissed. On appeal, the Federal Circuit reversed, holding that claim 5 is not directed to an abstract idea because the claim improved the functionality of a computer.

Earlier this month, in Novartis Pharms. Corp., Inc. v. Accord Healthcare, Inc., et al., No. 2021-1070, the Federal Circuit issued a helpful decision concerning the not-often-discussed written description requirement. The panel specifically addressed whether sufficient written description can exist for claim limitations that are not explicitly or directly disclosed in the specification (including negative claim limitations). This new ruling provides patent owners with a useful guide for successfully navigating similar written description challenges in patent infringement cases. For example, Patent Owners seeking to combat written description requirement challenges should proffer expert witnesses who can clearly articulate how they understand the patent description in relation to the claims and what portions of that description support the same.

On November 5, 2021, the U.S. Court of Appeals for the Federal Circuit in Celgene Corp. v. Mylan Pharmaceuticals Inc., Case No. 21-1154, affirmed a decision from the District Court of New Jersey dismissing a suit brought by Celgene Corporation (“Celgene”) under Rule 12(b)(6) for improper venue as to defendants Mylan Pharmaceuticals Inc. (“MPI”) and Mylan Inc. and for the failure to state a claim against defendant Mylan N.V. Celgene had brought suit after MPI submitted an ANDA seeking approval to market a generic version of the drug Pomalyst used to treat multiple myeloma. In assessing venue, the court held that it was MPI’s ANDA submission to the U.S. Food and Drug Administration (“FDA”), and not the sending of a notice letter to Celgene in New Jersey, that was the artificial act of infringement pursuant to the Hatch-Waxman Act. The district court thus held, and the Federal Circuit affirmed, that venue in New Jersey was improper.

On Monday, the Supreme Court denied TCL Communication’s certiorari petition, without comment, appealing the Federal Circuit’s ruling that the essentiality of a patent claim is a question for the jury rather than judges to resolve during claim construction.  The denial of cert by the Supreme Court cements the Federal Circuit ruling which made proving infringement of standard essential patents easier by allowing reliance on the standard to show such infringement. 

The Federal Circuit in Apple Inc. v. Qualcomm Incorporated handed down a decision on April 7, 2021 that provides guidance on the determination of standing for patent licensees who wish to contest the validity of a patent or patents in a licensed portfolio.

The Federal Circuit’s recent Uniloc 2017 v. Facebook Inc. decision is a mixed bag of good and bad news for both patent owners and inter partes review petitioners.  On the plus side for patent owners (but not for petitioners), the Federal Circuit determined that the so-called “No Appeal” provision does not necessarily apply to 35 U.S.C. § 315(e)(1), and, therefore, a patent owner may still appeal a Patent Trial and Appeal Board determination that a petitioner is not estopped from maintaining an IPR under § 315(e)(1). 

On January 28, 2021, the Federal Circuit affirmed the general principle that the mere fact of copying by an accused infringer is insufficient to rebut a charge of obviousness (L’Oreal USA, Inc. v. Olaplex, Inc.; appeal from PGR2018-00025; non-precedential). 

It is now over 10 years since the Bilski decision was handed down by the United States Supreme Court.  In that decision and several other decisions that followed (i.e., Mayo, Myriad, and Alice), the Supreme Court pronounced patent claims directed to abstract ideas not eligible for patent protection.

In Network-1 Techs., Inc. v. Hewlett-Packard, No. 18-2338, the Federal Circuit reversed and vacated multiple aspects of the district court’s final judgment holding that Hewlett-Packard (HP) did not infringe U.S. Patent No. 6,218,930 (“the ’930 patent”) disclosing an apparatus and method for remotely powering Ethernet compatible equipment.

In XY, LLC v. Trans Ova Genetics, LC (Case 2019-1789, issued July 31, 2020), the Federal Circuit provided another example of a life sciences method claim avoiding patent ineligibility under the Alice framework at step one, altogether avoiding the “inventive concept” analysis under step two. 

Last month, in a precedential decision, the Federal Circuit vacated-in-part and remanded the Patent Trial and Appeal Board’s (“Board”) obviousness determination regarding Alacritech’s computer networking patent because the Board failed to adequately explain its findings for three of the challenged claims.

The Federal Circuit yesterday, in a decision likely to be celebrated by holders of standard essential patents (“SEPs”), found that it is appropriate for the jury to decide essentiality of a patent, rather than the judge during claim construction.  This decision in Godo Kaisha IP Bridge I v. TCL Commc’n Tech. Holdings Ltd. also approved of the use of the standard as evidence of infringement where it was established that the accused products are standard compliant. 

Yesterday we discussed the Federal Circuit’s decision in Uniloc 2017 LLC v. Hulu, LLC  confirming the Board’s authority to review contingent substitute claims after the original claims have been held invalid by a federal court.  Today we cover the panel’s ruling that the Board can use any patentability requirement to evaluate and reject proposed substitute claims in an IPR, notwithstanding that originally-petitioned claims in such proceedings can only be challenged under §§ 102 and 103 based on prior patents and printed publications.

Last week a Federal Circuit panel in Uniloc 2017 LLC v. Hulu, LLC issued an important decision regarding inter partes review (IPR) before the Patent Trial and Appeal Board on two questions concerning contingent motions to amend—(i) whether the Office has statutory authority to review the patentability of substitute claims after a final federal-court judgement of invalidity of those claims and, if yes, (ii) whether that review of patentability may include analyzing the substitute claims for patent eligibility under 35 U.S.C. § 101. 

Entities with patent-related relationships with state universities scored a victory under the rarely implicated (at least for patent practitioners) doctrine of sovereign immunity.  For patent holders, sovereign immunity comes into play when a state actor, for example a state university, enters contracts related to patents, such as in Gensetix v. Baylor College of Medicine. 

Recently, in Packet Intelligence LLC v. NetScout Sys., Inc., No 19-2041 (July 14, 2020), the Court of Appeals for the Federal Circuit reversed a jury verdict of $3.5 million in pre-suit damages and vacated the trial court’s enhancement of that award because licensees of the asserted patents failed to properly mark allegedly patent practicing products.

Recent oral arguments at the Fed Circuit suggest that the U.S. may be taking steps which would enhance its attractiveness for SEP patent holders looking to resolve licensing disputes.  The Federal Circuit heard oral argument on Monday, July 6th, in Godo Kaisha IP Bridge I v. TCL Commc’n Tech. Holdings Ltd., No. 19-2215, that may pave an easier path for owners of standard essential patents (“SEPs”) to prove literal infringement of products that comply with that standard.