Chisum on Patents Case Reporter

Transcription

1 Release No. 85 October 2002 Also available on the Patent Practice Area Page on Route to: Chisum on Patents Case Reporter This Case Reporter reflects recent Federal Circuit decisions that will be included in the next release of Chisum on Patents Release 85 for Chisum on Patents brings the Federal Circuit Guide supplements in Volumes 11 to 14 current for decisions of the United States Supreme Court and the Court of Appeals for the Federal Circuit up to May Among the numerous important decisions are ones on: (1) claim interpretation, the doctrine of equivalents and prosecution history estoppel, (2) on sale bars (Section 102(b)), (3) written description of the invention and enablement (Section 112), (4) step-plus-function clauses (Section 112, paragraph 6), (5) obviousness, (6) prosecution laches, (7) Rule 11 obligations to investigate prior to filing an infringement suit, (8) bona fide purchaser defense, (9) damages for infringement, (10) interferences, (11) the repair defense, (12) practicing the prior art as an infringement defense, (13) design patents, and (14) preambles as claim limitations. SUPREME COURT DECISIONS: FESTO PROSECUTION HISTORY ESTOPPEL DOCTRINE OF EQUIVALENTS (1) ANY REQUIREMENT OF PATENT ACT. [A] narrowing amendment made to satisfy any requirement of the Patent Act may give rise to an estoppel. (2) AVOID PRIOR ART; COMPLY WITH SECTION 112. A patentee who narrows a claim as a condition for obtaining a patent disavows his claim to the broader subject matter, whether the amendment was made to avoid the prior art or to comply with 112. We must regard the patentee as having conceded an inability to claim the broader subject matter or at least as having abandoned his right to appeal a rejection. In either case estoppel may apply. (3) PRESUMED TO BE A GENERAL DISCLAIMER. A patentee s decision to narrow his claims through amendment may be presumed to be a general disclaimer of the territory between the original claim and the amended claim. (3) There are some cases... where the amendment cannot reasonably be viewed as surrendering a particular equivalent. (a) EQUIVALENT UNFORESEEABLE AT TIME OF APPLICATION. The equivalent may have been unforeseeable at the time of the application.... (b) RATIONALE UNDERLYING AMENDMENT. [T]he rationale underlying the amendment may bear no more than a tangential relation to the equivalent in question.... (c) REASON FOR NOT DESCRIBING INSUBSTANTIAL SUBSTITUTE. [T]here may be some other reason suggesting that the patentee could not reasonably be expected to have described the insubstantial substitute in question. Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., Ltd., 122 S. Ct. 1831, 62 USPQ2d 1705 (2002) NO FEDERAL CIRCUIT JURISDICTION BASED ON PATENT LAW COUNTERCLAIM (1) The Federal Circuit does not have appellate jurisdiction over a case in which the complaint does not allege a claim arising under federal patent law, but the answer contains a patent-law counterclaim. (a) Not all cases involving a patent-law claim fall within the Federal Circuit s jurisdiction. (b) WELL-ESTABLISHED BODY OF LAW. By limiting the Federal Circuit s jurisdiction to cases in which district courts would have jurisdiction under 1338, Congress referred to a well-established body of law that requires courts to consider whether a patent-law claim appears on the face of the plaintiff s well pleaded complaint.

2 (c) NO WELL-PLEADED-COMPLAINT-OR- COUNTERCLAIM RULE. [W]e decline to transform the longstanding well-pleaded- complaint rule into the well-pleaded-complaint-or-counterclaim.... (d) INTERPRETIVE NECROMANCY. It would be an unprecedented feat of interpretive necromancy to say that 1338(a) s arising under language means one thing (the well-pleaded- complaint rule) in its own right, but something quite different ([the patent owner s] complaint-or-counterclaim rule) when referred to by 1295(a)(1), which defines the Federal Circuit s appellate jurisdiction. (2) CONCURRING JUSTICE: CASES ON DISTRICT COURT RETENTION OF JURISDICTION OVER COUNTERCLAIM WHEN ORIGINAL CLAIM DISMISSED OR JURISDICTIONALLY DEFECT. Cases referred to by concurring Justice Stevens as well-reasoned precedent supporting the contrary conclusion, which were also cited by the Federal Circuit in Aerojet-General Corp. v. Machine Tool Works, Oerlikon- Buehrle Ltd., 895 F.2d 736 (C.A. Fed. 1990), simply address whether a district court can retain jurisdiction over a counterclaim if the complaint (or a claim therein) is dismissed or if a jurisdictional defect in the complaint is identified. (a) They do not even mention the well-pleadedcomplaint rule that the statutory phrase arising under invokes. (b) Nor do any of these cases interpret 1295(a)(1) or another statute conferring appellate jurisdiction with reference to the jurisdiction of the district court. (c) WELL-PLEADED, NOT WELL-TRIED, CASE. Thus, the cases... have no bearing on whether the phrase arising under can be interpreted differently in ascertaining the jurisdiction of the Federal Circuit than that of the district court. (3) CONCURRING JUSTICE: PATENT CLAIM ACTUALLY ADJUDICATED? Concurring, Justice Ginsburg contends that giv[ing] effect to Congress s intention to eliminate forum shopping and to advance uniformity in... patent law requires that the Federal Circuit have exclusive jurisdiction whenever a patent claim was actually adjudicated. (a) We rejected precisely this argument in Christianson, viz., the suggestion that the Federal Circuit s jurisdiction is fixed by reference to the case actually litigated. 486 U.S., at (b) We held that the Federal Circuit s jurisdiction, like that of the district court, is determined by reference to the well-pleaded complaint, not the well-tried case. (4) AMENDMENT (ACTUAL OR CONSTRUCTIVE) ADDING PATENT CLAIM. Like Christianson v. Colt Industries Operating Corp., 486 U.S. 800, (1988), this case does not call upon us to decide whether 2 October 2002 CHISUM ON PATENTS CASE REPORTER the Federal Circuit s jurisdiction is fixed with reference to the complaint as initially filed or whether an actual or constructive amendment to the complaint raising a patent-law claim can provide the foundation for the Federal Circuit s jurisdiction. (5) TRANSFER TO REGIONAL CIRCUIT. Because [plaintiff s] complaint did not include any claim based on patent law, we vacate the judgment of the Federal Circuit and remand the case with instructions to transfer the case to the Court of Appeals for the Tenth Circuit. See 28 U.S.C Holmes Group, Inc. v. Vornado Air Circulation Systems, Inc., 122 S.Ct. 1889, 62 USPQ2d 1801 (2002) FEDERAL CIRCUIT DECISIONS: CLAIM INTERPRETATION, DOCTRINE OF EQUIVALENTS AND PROSECUTION HISTORY ESTOPPEL DOCTRINE OF EQUIVALENTS DISCLOSED BUT UNCLAIMED SUBJECT MATTER DEDICATED TO PUBLIC (1) A patent claimed a structure, the claim requiring an aluminum substrate. U.S. Pat. No. 5,153,050. The patent s specification disclosed that aluminum was the preferred material for the substrate but that other materials, including steel could be used. An accused structure used a steel substrate. (a) MAXWELL (1996). As stated in Maxwell [v. J. Baker, Inc., 86 F.3d 1098, 39 USPQ2d 1001 (Fed. Cir. 1996)], when a patent drafter discloses but declines to claim subject matter, as in this case, this action dedicates that unclaimed subject matter to the public. (b) Application of the doctrine of equivalents to recapture subject matter deliberately left unclaimed would conflict with the primacy of the claims in defining the scope of the patentee s exclusive right. Sage Prods. Inc. v. Devon Indus., Inc., 126 F.3d 1420, 1424, 44 USPQ2d 1103, 1107 (Fed. Cir. 1997) (citing Warner-Jenkinson, 520 U.S. at 29); see also Conopco, Inc. v. May Dep t Stores Co., 46 F.3d 1556, 1562, 32 USPQ2d 1225, 1228 (Fed. Cir. 1994) ( The doctrine of equivalents cannot be used to erase meaningful structural and functional limitations of the claim on which the public is entitled to rely in avoiding infringement. (internal citations omitted)); Charles Greiner & Co. v. Mari-Med Mfg., Inc., 962 F.2d 1031, 1036 (Fed. Cir. 1992) ( Most important, however, a

3 court must, in applying the doctrine, avoid significant conflict with the fundamental principle that claims define the limits of patent protection. ). (c) AVOIDING PROSECUTION SCRUTINY. [A] patentee cannot narrowly claim an invention to avoid prosecution scrutiny by the PTO, and then, after patent issuance, use the doctrine of equivalents to establish infringement because the specification discloses equivalents. Such a result would merely encourage a patent applicant to present a broad disclosure in the specification of the application and file narrow claims, avoiding examination of broader claims that the applicant could have filed consistent with the specification. Maxwell, 86 F.3d at 1107 (citing Genentech, Inc. v. Wellcome Found. Ltd., 29 F.3d 1555, 1564, 31 USPQ2d 1161, 1167 (Fed. Cir. 1994)). By enforcing the Maxwell rule, the courts avoid the problem of extending the coverage of an exclusive right to encompass more than that properly examined by the PTO. Keystone Bridge Co. v. Phoenix Iron Co., 95 U.S. 274, 278 (1877) ( [T]he courts have no right to enlarge a patent beyond the scope of its claim as allowed by the Patent Office, or the appellate tribunal to which contested applications are referred. ). (d) YBM MAGNEX: MAXWELL LIMITED TO DISCLOSURE OF UNCLAIMED ALTERNATIVE DISTINCT ALTERNATIVE. [T]his court in YBM Magnex[, Inc. v. Int l Trade Comm n, 145 F.3d 1317, 46 USPQ2d 1843 (Fed. Cir. 1998),] purported to limit Maxwell to situations where a patent discloses an unclaimed alternative distinct from the claimed invention. (e) YBM MAGNEX (1998) OVERRULED. To the extent that YBM Magnex[, Inc. v. Int l Trade Comm n, 145 F.3d 1317, 46 USPQ2d 1843 (Fed. Cir. 1998),] conflicts with this holding, this en banc court now overrules that case. (f) GRAVER TANK (1950): NO DEDICATION; EQUIVALENT CLAIMED IN INVALID CLAIM. The Court s holding and the history of Graver II show that the patentee had not dedicated unclaimed subject matter to the public. In fact, the patentee had claimed the equivalent subject matter, even if the Court eventually held the relevant claims too broad. Graver Tank & Mfg. Co. v. Linde Air Prods. Co., 339 U.S. 605, 609 (1950). (g) OTHER REMEDIES. A patentee who inadvertently fails to claim disclosed subject matter... is not left without remedy. (i) REISSUE WITHIN TWO YEARS. Within two years from the grant of the original patent, a patentee may file a reissue application and attempt to enlarge the scope of the original claims to include the disclosed but previously unclaimed subject matter. 35 U.S.C. 251 (2000). (ii) CONTINUATION APPLICATION. In addition, a patentee can file a separate application claiming the disclosed subject matter under 35 U.S.C. 120 (2000) (allowing filing as a continuation application if filed before all applications in the chain issue). (iii) PATENTEE TAKES ADVANTAGE OF SECOND OPTION: SUBSEQUENT PATENTS WITH BROADER CLAIMS. The patentee in this case took advantage of the latter of the two options by filing two continuation applications that literally claim the relevant subject matter. These applications issued as U.S. Patent Nos. 5,725,937 (the 937 patent) and 5,674,596 (the 596 patent) on March 10, 1998 and October 7, 1997, respectively. Claims 3 and 6 of the 596 patent claim a metal substrate sheet, while independent claims of the 937 patent claim a sheet of stainless steel. (2) In this case, [the] patent specifically limited the claims to a sheet of aluminum and the aluminum sheet. The specification of the... patent, however, reads: While aluminum is currently the preferred material for the substrate, other metals, such as stainless steel or nickel alloys may be used.... Having disclosed without claiming the steel substrates, [the patent owner] cannot now invoke the doctrine of equivalents to extend its aluminum limitation to encompass steel. Thus, [the patent owner] cannot assert the doctrine of equivalents to cover the disclosed but unclaimed steel substrate. Johnson & Johnston Associates Inc. v. R.E. Service Co., Inc., 285 F.3d 1046, 62 USPQ2d 1046 (Fed. Cir. 2002) (en banc) DOCTRINE OF EQUIVALENTS SPECIFIC NUMERIC RANGES ARGUMENTS IN PROSECUTING A FIRST PATENT NOT ESTOPPEL AS TO A SECOND PATENT ON A DISTINCT INVENTION (1) NO PRECLUSION OF EQUIVALENCY. A district court erred in holding that a patent owner was precluded from asserting infringement under the doctrine of equivalents by estoppel, by the prior art, by the ban on claim limitation vitiation or by the use of specific numeric ranges. Because the district court improperly precluded plaintiffs from relying on the doctrine of equivalents to prove infringement, we vacate the judgment of noninfringement and remand for further proceedings in accordance with this opinion. CHISUM ON PATENTS CASE REPORTER October

4 (2) FIRST PATENT: CLAIMS ALLOWED AFTER ARGUMENT DISTINGUISHING PRIOR ART. A first patent by three inventors, including a Dr. Tanaka, disclosed and claimed a lung surfactant, which was based on the inventors discovery of beneficial properties of a composition (TA-546). The first patent s claims required, inter alia, a phospholipid content of % and a water content of %. The claims were initially rejected by an examiner as obvious in light of three prior art references. The claims were allowed only after the patent owner had argued that only... a material having composition claimed had certain properties. (3) SECOND PATENT: ALLOWED WITHOUT ARGUMENT OR AMENDMENT. A second patent was based on Dr. Tanaka s continued confirmatory studies of TA-546 and his discovery that its properties are enhanced by increasing the amount of free fatty acids to %. The first patent did not disclose the free fatty acid content of the TA-546, which was, in fact, less than 1.0%. The second patent was based on an independent application filed three months after the examiner had allowed the claims in the first patent. It was neither a continuation nor a continuation-in-part of the application leading to the first patent. Its claims required, inter alia, a phospholipid content of %, that is, below the first patent s maximum of 95.5%, and also a free fatty acid content of %. The examiner, who had also examined the first patent, allowed the claims of the second patent, finding no prior art that anticipated or rendered obvious the claims. (4) PRIOR LITIGATION ON FIRST PATENT: ESTOPPEL BY ARGUMENT. In a prior suit on the first patent, the Federal Circuit upheld a finding of non-infringement because the patent owner had not established the water content of an accused composition and thus had not show that the percentage of water limitation of the first patent s claims was met. The court stated that the patent owner s argument during prosecution was an unmistakable assertion... in support of patentability that estopped the patent owner from asserting that the water percentage limitation was irrelevant. Forest Laboratories, Inc. v. Abbott Laboratories, 239 F.3d 1305, 57 USPQ2d 1794 (Fed. Cir. 2001). (5) ACCUSED COMPOSITION WITH 94.5%: EQUIVALENT TO CLAIMED 90.7%? In a suit on the second patent, an accused composition had, according to the patent owner s tests, a phospholipid content of 91.8% or 94.5%. Because this was above the second patent s limitation of 90.7%, the patent owner conceded the absence of literal infringement but asserted infringement under the doctrine of equivalents. It presented an expert s testimony that a composition 4 October 2002 CHISUM ON PATENTS CASE REPORTER with 95% phospholipid would work exactly the same as the claimed composition and that a phospholipid content as high 99% would probably work. (6) The district court granted summary judgment of non-infringement, reasoning that the patent owner had, based on the prosecution history of first as well as the second patent, surrendered the right to claim compositions with more than 90% phospholipid content. (a) IMPROPER USE OF FIRST PATENT S PROSECUTION HISTORY TO LIMIT SECOND PATENT. The arguments used in prosecution of the first patent did not provide an estoppel precluding an assertion of equivalance of the second patent. (b) INSUFFICIENT RELATIONSHIP. [T]he relationship, if any, between the [second] and [first] patents is insufficient to render particular arguments made during prosecution of the [first] patent equally applicable to the claims of the [second] patent.... (c) COMMON ASSIGNEE AND INVENTOR; NO FORMAL RELATIONSHIP; PRESENTED AS INDEPENDENT INVENTIONS. The two patents are commonly owned, and the inventor of the [second] patent is one of the three inventors of the [first] patent. However, the second application was not filed as a continuation, continuation-in-part, or divisional application of the [first] application, the applications have no formal relationship, and they were presented to the patent office as patentably distinct inventions. The invention disclosed in the second patent was based on the continuing studies of the inventor. (7) PRIOR ART; HYPOTHETICAL CLAIM. In finding that a hypothetical claim that would literally encompass the accused composition would not have been patentable over the prior art first patent, the district court erred by focusing solely on the one expanded claim limitation, a hypothetical phopspholipid content of 94.5% instead of the claimed content of 90.7%. [A] hypothetical claim with an upper limit of 94.5% phospholipid continues to distinguish over the [first] patent for the same reason as the originally drafted claim: the addition of free fatty acids in the claimed range of 1.0%-27.7%. (8) NO VITIATION OF LIMITATION. A finding of infringement under the doctrine of equivalents would not vitiate the 90.7% phospholipid content limitation. The patent owner s expert did testify that a content as high as 99% would work, but he also testified that there is an upper limit. (9) SPECIFIC NUMERIC RANGES NO SURRENDER OF EQUIVALENCY. The district court erred by reasoning that the patent owner s use of specific percentage ranges precludes the patent owner from

5 relying on the doctrine of equivalents. Abbott Laboratories v. Dey, L.P., 287 F.3d 1097, 62 USPQ2d 1545 (Fed. Cir. 2002) CLAIM CHART: FAILURE TO INCLUDE DOCTRINE OF EQUIVALENTS IN CLAIM CHART REQUIRED BY LOCAL DISTRICT COURT RULE (1) A local rule of the Northern District of California, Civil Local Rule 16-9(a)(3), required a patent owner to state in a claim chart whether such infringement is claimed to be literal or under the doctrine of equivalents. Civ. L.R. 16-9(a)(3). A district court did not abuse its discretion by enforcing the Local Rule and precluding [the patent owner] from asserting infringement under the doctrine of equivalents when [the patent owner] did not include that theory in its claim chart. (2) PHILOSOPHY: CONSERVATIVE, AVOID SHIFTING SANDS APPROACH TO CLAIM CONSTRUCTION. As the district court noted, [u]nlike the liberal policy for amending pleadings, the philosophy behind amending claim charts [under Rule 16-9] is decidedly conservative and designed to prevent the shifting sands approach to claim construction. (3) GUIDELINES FOR MANAGING PATENT CASES. Furthermore, this court defers to the district court when interpreting and enforcing local rules so as not to frustrate local attempts to manage patent cases according to prescribed guidelines. Genentech, Inc. v. Amgen, Inc., 289 F.3d 761, 62 USPQ2d 1640 (Fed. Cir. 2002) ON SALE BARS SECTION 102(b) ON SALE BARS LICENSE CONVEYING RIGHT TO COMMERCIALIZE A PROCESS (1) A party s pre-critical date agreement granting a licensee the right to commercialize a process invention, including the right to use the process to make and sell products, did not constitute a barring sale under Section 102(b) absent evidence that the party or licensee either offered to actually perform the process commercially or offered to sell a product made using the process. (2) An applicant s claims concerned a process for preparing dialkyl peroxide. Before the critical date, the applicant s assignee, Redox, entered into an agreement with another company, Celanese, to share technology and coordinate research with the goal of designing and building a commercial plant capable of implementing the process to manufacture ethylene glycol. The agreement conferred on the licensee, Celanse, the right to operate plants and to sell the resultant products. (3) The PTO Board erred in holding that the agreement placed the invention on sale. (4) LICENSE GRANTING PATENT RIGHTS. [A] license that merely grants rights under a patent cannot per se trigger the application of the on-sale bar. (5) PRODUCT AND PROCESS. The Board... erred in failing to recognize the distinction between a claim to a product, device, or apparatus, all of which are tangible items, and a claim to a process, which consists of a series of acts or steps. (a) TANGIBLE ITEM: TRANSFER OF TITLE. A tangible item is on sale when, as we held in Group One, the transaction rises to the level of a commercial offer for sale under the Uniform Commercial Code. [Group One, Ltd. v. Hallmark Cards, Inc., 254 F.3d 1041, 1047, 59 USPQ2d 1121, 1126 (Fed. Cir. 2001).] When money changes hands as a result of the transfer of title to the tangible item, a sale normally has occurred. (b) PROCESS: ACTS, DOING SOMETHING. A process... is a different kind of invention; it consists of acts, rather than a tangible item. It consists of doing something, and therefore has to be carried out or performed. (c) PROCESS NOT SOLD. A process is thus not sold in the same sense as is a tangible item. (d) KNOW-HOW SOLD; BUYER ACQUIRES KNOWLEDGE AND FREEDOM TO CARRY OUT; NOT A SECTION 102(b) SALE. Know-how describing what the process consists of and how the process should be carried out may be sold in the sense that the buyer acquires knowledge of the process and obtains the freedom to carry it out pursuant to the terms of the transaction. However, such a transaction is not a sale of the invention within the meaning of 102(b) because the process has not been carried out or performed as a result of the transaction. (e) LICENSE TO PATENT COVERING PROCESS. The same applies to a license to a patent covering a process. (f) The Board in this case failed to recognize this distinction, and therefore erred in concluding that the license to the process under any future patents, and the accompanying description of that process, constituted a sale of the subject matter of those patents, viz., the process. (6) WHAT CONSTITUTES SALE OF A PROCESS? We cannot articulate in advance what would constitute a sale of a process in terms of the on-sale bar. CHISUM ON PATENTS CASE REPORTER October

6 (a) SALE OF PRODUCT MADE BY PROCESS BY PATENTEE OR LICENSEE. Surely a sale by the patentee or a licensee of the patent of a product made by the claimed process would constitute such a sale because that party is commercializing the patented process in the same sense as would occur when the sale of a tangible patented item takes place. See D.L. Auld Co. v. Chroma Graphics Corp., 714 F.2d 1144, , 219 USPQ 13, (Fed. Cir. 1983) (holding that a sale by a patentee or an assignee of a product made by a claimed method before the critical date results in a forfeiture of any right to a patent to that method, even though the sale of the product did not reveal anything about the method to the public); see also W.L. Gore & Assocs., Inc. v. Garlock, Inc., 721 F.2d 1540, 1550, 220 USPQ 303, 310 (Fed. Cir. 1983) (same). (b) Although D.L. Auld and W.L. Gore involved the forfeiture of patent rights due to sales by patentees or assignees, we see no reason why that rule should not equally apply to licensees of those parties. (c) ACTUALLY PERFORMING PROCESS FOR CONSIDERATION. Actually performing the process itself for consideration would similarly trigger the application of 102(b). See Scaltech, Inc. v. Retec/ Tetra, L.L.C., 269 F.3d 1321, 1328, 60 USPQ2d 1687, 1691 (Fed. Cir. 2001) (holding that a claim to a process for treating oil refinery waste was invalid under 102(b) because the patentee offered to perform the claimed process more than one year before filing for a patent). (d) These situations, however, are not before us. (e) LICENSING PROCESS WHEN DEVELOPMENT MUST OCCUR BEFORE COMMERCIALIZATION OF PROCESS. We hold only that licensing the invention, under which development of the claimed process would have to occur before the process is successfully commercialized, is not such a sale. (7) EXCLUSIVE OR NON-EXCLUSIVE. The fact that [a] license could potentially be exclusive or nonexclusive does not alter our analysis. Both types of licenses involve only rights under any future patent, and in neither case is a product of the claimed process actually offered for sale. In re Kollar, 286 F.3d 1326, 62 USPQ2d 1425 (Fed. Cir. 2002) ON SALE BAR FAILURE TO CONSTRUE CLAIMS (1) A district court erred by granting summary judgment that pre-critical date offers to sell a device 6 October 2002 CHISUM ON PATENTS CASE REPORTER invalidated independent and dependent claims in two patents. First, it did not construe the limitations of the claims. Second, it did not apply the claims as construed to the alleged invalidating device. Third, it failed to analyze separately the validity of dependent claims, which added limitations to the patents independent claims. (a) [A] court may not invalidate the claims of a patent without construing the disputed limitations of the claims and applying them to the allegedly invalidating acts. See Scaltech [Inc. v. Retec/Tetra, L.L.C., 178 F.3d 1378, 1383, 51 USPQ2d 1055, 1058 (Fed. Cir. 1999)] (emphasizing that the invalidating act must be within the scope of the claim). Otherwise,... the decision invalidating the patent becomes effectively unreviewable. (b) The court s evaluation must recognize the statutory presumption of validity and the need for facts supporting a conclusion of invalidity by clear and convincing evidence. (c) NO CONCESSION ON APPLICATION OF CLAIMS. [A]doption by the court of a patentee s claim construction does not constitute a concession of the correctness of the court s application of those claims to the alleged invalidating acts. (2) DEPENDENT CLAIMS. [A]n independent evaluation [of dependent claims] is necessary because dependent claims necessarily add limitations to the claims from which they depend and may therefore not be subject to the same asserted grounds of invalidity. Dana Corp. v. American Axle & Mfg., Inc., 279 F.3d 137, 61 USPQ2d 1609 (Fed. Cir. 2002) ON SALE EXPERIMENTAL USE EXCEPTION (1) A district court erred in granting summary judgment that a patent was invalid because of a pre-critical date sale of the patented invention. There were disputed material fact issues on whether the sale was for experimental use. (a) The invention was a floating dock. One of the inventors installed a prototype of the dock at his own marina on a river. A friend offered to buy an embodiment of the dock to be installed at a camp across the river. Prior to the critical date, the inventors sold the dock to the friend at a price below the eventual market price, installed it for free, and provided free equipment. The inventors inspected the camp dock structure on a number of occasions. The camp location experienced ore boat traffic and more turbulent river flow than the

7 marina location. After the camp location dock installation, the inventors modified one feature of the invention, the shape of pylons, from a rectangular shape to a frustoconical shape. (b) An accused infringer established a prima facie case that the patent was invalid because of an on-sale bar, but the patent owner put forth evidence that the sale of the embodiment of the invention was experimental, including evidence that (i) the buyer, not the inventors, initiated the sale, (ii) the buyer did not pay full market price, (iii) the inventors provided installation and equipment for free, (iv) the inventors visited the buyer s premises on several occasions, (v) the inventors made free repairs, (vi) there was a need to test the invention for durability under the conditions at the buyer s premises, and (vii) the inventors changed a feature of the embodiment sold to the buyer (the shape of the pylons). (c) DURABILITY. In Manville Sales Corp. v. Paramount Sys. Inc., 917 F.2d 544, 550, 16 USPQ2d 1587, 1592 (Fed. Cir. 1990), this court permitted the inventor to test the invention for durability during winter although claims did not expressly mention durability or severe weather conditions. Instead this court reasoned that the nature of the invention (luminaires) required durability so that the claims reference to the subject matter placed that topic within the proper frame of experimentation. (2) NO CONFLICT WITH READY FOR PATENTING PRONG; REDUCTION TO PRACTICE. [T]he Supreme Court and this court apply the experimental use negation without conflict with the ready for patenting prong of the [Pfaff] new on-sale bar test. (3) PFAFF (1998): TWO-PART TEST. In Pfaff v. Wells Elecs., Inc., 525 U.S. 55 (1998), the Supreme Court recently set forth a two-part test for application of the on-sale bar. (a) The bar applies when an invention is both the subject of a commercial offer for sale and ready for patenting before the critical date. (b) The Supreme Court also explained that the second condition ready for patenting may be satisfied in at least two ways: by proof of reduction to practice before the critical date; or by proof that prior to the critical date the inventor had prepared drawings or other descriptions of the invention that were sufficiently specific to enable a person skilled in the art to practice the invention. (c) PRIOR FEDERAL CIRCUIT TEST: TOTALITY OF THE CIRCUMSTANCES. Before the Supreme Court s decision in Pfaff, this court used a multifactor, totality of the circumstances test to enforce the on-sale bar. See, e.g., Micro Chem., Inc. v. Great Plains Chem. Co., 103 F.3d 1538, 1544, 41 USPQ2d 1238, 1243 (Fed. Cir. 1997) ( all of the circumstances surrounding the sale or offer to sell, including the stage of development of the invention and the nature of the invention, must be considered and weighed against the policies underlying section 102(b) ). (d) UNNECESSARILY VAGUE. In Pfaff, the Supreme Court determined that the totality of circumstances test was unnecessarily vague and seriously undermine[d] the interest in certainty. Pfaff, 525 U.S. at 66 & n. 11. (e) Therefore, this court now follows the Supreme Court s two-part test without balancing various policies according to the totality of the circumstances. Weatherchem Corp. v. J.L. Clark, Inc., 163 F.3d 1326, 1333, 49 USPQ2d 1001, 1006 (Fed. Cir. 1998). (4) EXPERIMENTAL USE AS NEGATION OF SECTION 102(b) BAR, NOT FREE-STANDING DOCTRINAL EXCEPTION. This court has repeatedly stressed that evidence of experimental use does not give rise to a freestanding doctrinal exception to statutory bars, but instead operates to negate application of section 102(b).... Because adequate proof of experimentation negates a statutory bar, the focus remains throughout the inquiry on application of the statutory bar itself. (5) EFFECT OF PFAFF ON PROOF OF EXPERIMENTAL USE. This focus on the requirements for a statutory bar... could raise questions about the effect of the Supreme Court s recent clarifications of the standards for a statutory bar on the proof of experimentation adequate to negate the bar. (a) EXPRESS PRESERVATION. In Pfaff, the Supreme Court expressly preserved the experimental use or sale negation of the section 102 bars: Nevertheless, an inventor who seeks to perfect his discovery may conduct extensive testing without losing his right to obtain a patent for his invention even if such testing occurs in the public eye. The law has long recognized the distinction between inventions put to experimental use and products sold commercially. Pfaff, 525 U.S. at 64. (b) Experimentation evidence includes tests needed to convince [the inventor] that the invention is capable of performing its intended purpose in its intended environment. Gould Inc. v. United States, 217 Ct. Cl. 167, 579 F.2d 571, 583, 198 USPQ 156, 167 (1978); Kolmes v. World Fibers Corp., 107 F.3d 1534, 1540, 41 USPQ2d 1829, 1833 (Fed. Cir. 1997) ( testing was... required in such an environment in order to ensure that the invention would work for its intended purpose ). (c) Indeed in Pfaff, the Supreme Court reiterated its guidance in City of Elizabeth v. American Nicholson Pavement Co., 97 U.S. 126, 137, 24 L.Ed (1877), that an inventor does not inappropriately delay filing by a bona fide effort to bring his invention to perfection, or CHISUM ON PATENTS CASE REPORTER October

8 to ascertain whether it will answer the purpose intended. Pfaff, 525 U.S. at (d) [T]he Supreme Court acknowledged that a litigant may show readiness for patenting with evidence of reduction to practice. Like evidence of experimentation sufficient to negate a bar, reduction to practice involves proof that an invention will work for its intended purpose. Scott v. Finney, 34 F.3d 1058, 1061, 32 USPQ2d 1115 (Fed. Cir. 1994). Even beyond this overlap of the experimental use negation and the ready for patenting standard, however, the Supreme Court explicitly preserved proof of experimentation as a negation of statutory bars. (6) LINN, CONCURRING. While I concur both in the conclusion reached and in the reasoning expressed in the majority opinion, I write to express my additional views on the experimental use doctrine.... (a) The experimental use doctrine permits an inventor to conduct testing to refine his invention without losing the right to obtain a patent, even if such testing occurs in the public eye. Pfaff v. Wells Electronics, Inc., 525 U.S. 55, 64, 48 USPQ2d 1641, 1645 (1998). (i) EXCEPTION. The experimental use doctrine arose as an exception to the traditional rule that an inventor loses the right to a patent if he puts the invention in public use or on sale before filing a patent application. Id., quoting Pennock v. Dialogue, 27 U.S. (2 Pet.) 1, 24, 7 L.Ed. 327 (1829) ( [h]is voluntary act or acquiescence in the public sale and use is an abandonment of his right. ). (ii) Congress codified the traditional rule as the public use and on-sale statutory bars of 35 U.S.C. 102(b) and included in the statutory scheme a one-year grace period. (iii) SURVIVAL AS COMMON LAW EXCEPTION. The experimental use doctrine survived as a common law exception to those statutory bars. Pfaff, 525 U.S. at 64-65, 48 USPQ2d at (iv) ELIZABETH (1877): PURPOSE: EXPERIMENTAL, NOT COMMERCIAL. The experimental use exception preserved the right to a patent if the purpose of a use made of an invention outside the one-year grace period was experimental as opposed to commercial: It is sometimes said that an inventor acquires an undue advantage over the public by delaying to take out a patent, inasmuch as he thereby preserves the monopoly to himself for a longer period than is allowed by the policy of the law; but this cannot be said with justice when the delay is occasioned by a bona fide effort to bring his invention to perfection, or to ascertain whether it will answer the purpose intended. His monopoly only continues for the allotted period, in any event; and it is the interest of the public, as well as himself, that the 8 October 2002 CHISUM ON PATENTS CASE REPORTER invention should be perfect and properly tested, before a patent is granted for it. Any attempt to use it for a profit, and not by way of experiment, for a longer period than two years before the application, would deprive the inventor of his right to a patent. Elizabeth v. Am. Nicholson Pavement Co., 97 U.S. 126, 137 (1877). (v) REFORMULATED AS NEGATION. The experimental use exception was, over time, reformulated as experimental use negation of the statutory bar of 102(b), in which the burden of persuasion does not shift at any time to the patentee. See TP Labs., Inc. v. Prof l Positioners, Inc., 724 F.2d 965, 971, 220 USPQ 577, 582 (Fed. Cir. 1984) ( it is incorrect to impose on the patent owner... the burden of proving that a public use was experimental. These are not two separable issues. It is incorrect to ask: Was it public use? and then Was it experimental? Rather, the court is faced with a single issue: Was it public use under 102(b)? ). A totality of the circumstances test was used to determine whether the use was experimental or commercial in character. See Western Marine Electronics, Inc. v. Furuno Elec. Co., 764 F.2d 840, 845, 226 USPQ 334, (Fed. Cir. 1985) ( the court will want to consider the totality of the circumstances relating to the character and extent of commercial activities,... along with the character and extent of bona fide experimentation ). However, the totality of the circumstances test was discredited by the Supreme Court, and, with respect to the on-sale bar, replaced with a two-part test. Pfaff, 525 U.S. at & n. 11, 48 USPQ2d at & n. 11. (b) PFAFF. The test announced by the Supreme Court in Pfaff set forth two conditions for application of the on-sale bar: [f]irst, the product must be the subject of a commercial offer for sale.... Second, the invention must be ready for patenting. (i) SECOND PRONG. The Supreme Court explained that the second prong is satisfied by either (a) proof of reduction to practice before the critical date, or (b) proof that prior to the critical date the inventor had prepared drawings or other descriptions of the invention that were sufficiently specific to enable a person skilled in the art to practice the invention. (ii) FIRST PRONG: CHARACTERISTICS OF INDIVIDUAL TRANSACTION. The first prong of the Pfaff test focuses on the commercial characteristics, if any, of the individual transaction. (iii) A resolution of the first prong depends on an objective assessment of the facts surrounding the transaction. The inventor s subjective intent to experiment is not sufficient. See Paragon Podiatry Lab., Inc. v. KLM Labs., Inc., 984 F.2d 1182, 1186, 25 USPQ2d 1561, 1564 (Fed. Cir. 1993) (citing TP Labs.,

9 724 F.2d at 972, 220 USPQ at 583 ( the expression by an inventor of his subjective intent to experiment, particularly after institution of litigation, is generally of minimal value )). (iv) SECOND PRONG: STAGE OF DEVELOPMENT. In contrast, the second prong focuses on the invention as a whole, implicating the invention s stage of development. It is only after the development of the invention has progressed to the stage where it is ready for patenting, that the second prong of the Pfaff test can be said to be satisfied. (c) PRE-PFAFF: REDUCTION PRACTICE CENTRAL FOCUS OF BOTH ON SALE BAR AND EXPERIMENTAL USE NEGATION. Before Pfaff, reduction to practice was a central focus of both the on-sale bar and experimental use negation thereof. See, e.g., Seal-Flex, Inc. v. Athletic Track & Court Constr., 98 F.3d 1318, 1324, 40 USPQ2d 1450, 1454 (Fed. Cir. 1996). (i) SYMMETRY AND SIMPLICITY. The coincidence of reduction to practice as a focal point for both aspects brought a symmetry, and often a simplicity, to the analysis. (A) EXPERIMENTAL USE UP TO, BUT NOT AFTER, REDUCTION TO PRACTICE. An invention could be the subject of an experimental use anytime up to reduction to practice. RCA Corp. v. Data Gen. Corp., 887 F.2d 1056, 1061, 12 USPQ2d 1449, 1453 (Fed. Cir. 1989). Once reduced to practice, the invention could not be the subject of an experiment that would negate an on-sale bar. Atlantic Thermoplastics Co., Inc. v. Faytex Corp., 5 F.3d 1477, 1480, 28 USPQ2d 1343, 1346 (Fed. Cir. 1993). (B) Conversely, an invention seldom would trigger an on-sale bar prior to the time it was reduced to practice. (ii) DISTINCTION BETWEEN EXPERIMENTAL STAGE AND EXPERIMENTAL PURPOSE: ACADEMIC? Because events that might be experimental in nature were only those occurring prior to the time the invention in question was reduced to practice, i.e., only during the experimental stage leading up to a reduction to practice, the distinction between a sale made for experimental purposes and a sale made during the experimental stage of an invention s development was often more academic than real. (d) TRANSITIONAL EVENTS CHANGE. After Pfaff, the coincidence of the transitional event of reduction to practice as a focal point for both the on-sale bar and the experimental use doctrine changed. (i) What Pfaff made clear is that the triggering event for an on-sale bar is not reduction to practice, but the advancement of the invention to the stage where it is ready for patenting. (ii) SYMMETRY DISAPPEARS. Because nothing in Pfaff altered the transitional significance of reduction to practice for experimental use negation, the heretofore complementary nature of the two tests and the symmetry that such congruence brought to the analytical framework disappeared. (iii) Traversing this new landscape now demands in each case a careful examination of the purpose of the use contemplated in a potentially barring sale, not merely that the invention then may be in an experimental stage, and signals a shift in focus from the second prong to the first in evaluating experimental use negation. (iv) PFAFF: NO CHANGE IN EXPERIMENTAL USE EXCEPTION. Pfaff changed the test for when an onsale bar is triggered, but it did not change the experimental use doctrine or the timing or nature of events giving rise to an experimental use exception. The law has long recognized the distinction between inventions put to experimental use and products sold commercially.... The Supreme Court stated that application of the on-sale bar of 102(b) continues to turn on whether the inventor s use of the invention was commercial or experimental.... In particular, the Court discussed the experimental use doctrine in connection with the first part of the Pfaff test in evaluating whether the invention was the subject of a commercial offer for sale: The experimental use doctrine, for example, has not generated concerns about indefiniteness, and we perceive no reason why unmanageable uncertainty should attend a rule that measures the application of the on-sale bar of 102(b) against the date when an invention that is ready for patenting is first marketed commercially. In this case... there is no question that the sale was commercial rather than experimental in character. (e) NATURE OF USE, NOT POSTURE OF INVENTION S OVERALL DEVELOPMENT. It bears repeating that what is important to an assessment of the commercial versus experimental significance of a sale is not necessarily the posture of the invention s overall development, but the nature or purpose of the particular use to which the invention that is the subject of that sale is to be put. See Manville Sales Corp. v. Paramount Sys., Inc., 917 F.2d 544, 550, 16 USPQ2d 1587, 1592 (Fed. Cir. 1990) ( a sale that is primarily for experimental purposes, as opposed to commercial exploitation, does not raise an on sale bar ); U.S. Envt l Prods., Inc. v. Westall, 911 F.2d 713, 716, 15 USPQ2d 1898, 1901 (Fed. Cir. 1990) ( [a] section 102(b) bar is avoided if the primary purpose of the sale was experimental ); Barmag Barmer Maschinenfabrik AG v. Murata Mach., Ltd., 731 F.2d 831, 839, 221 USPQ CHISUM ON PATENTS CASE REPORTER October

10 561, 567 (Fed. Cir. 1984) (quoting In re Theis, 610 F.2d 786, 793, 204 USPQ 188, 194 (CCPA 1979) ( [t]he experimental exception applies only if the commercial exploitation is merely incidental to the primary purpose of experimentation to perfect the invention )). (f) FIRST PRONG: NOT WHETHER INVENTION IS IN EXPERIMENTAL STAGE. Thus, the question posed by the experimental use doctrine, assessed under the first prong of the two-part on-sale bar test of Pfaff, is not whether the invention was under development, subject to testing, or otherwise still in its experimental stage at the time of the asserted sale. Instead, the question is whether the transaction constituting the sale was not incidental to the primary purpose of experimentation, i.e., whether the primary purpose of the inventor at the time of the sale, as determined from an objective evaluation of the facts surrounding the transaction, was to conduct experimentation. Scaltech, Inc. v. Retec/ Tetra, L.L.C., 178 F.3d 1378, 1384 n. 1, 51 USPQ2d 1055, 1059 n. 1 (Fed. Cir. 1999). (g) NO EXPERIMENTAL USE AFTER REDUCTION TO PRACTICE. [O]nce the invention is reduced to practice, there can be no experimental use negation. Zacharin v. United States, 213 F.3d 1366, 1369, 55 USPQ2d 1047, 1050 (Fed. Cir. 2000); RCA Corp., 887 F.2d at 1061, 12 USPQ2d at But up to that point, regardless of the stage of development of the invention, and quite apart from the possible satisfaction of the second prong of the Pfaff test, the inventor is free to experiment, test, and otherwise engage in activities to determine if the invention is suitable for its intended purpose and thus satisfactorily complete. (h) CLAIM-BY-CLAIM EVALUATION. Furthermore, because the statutory bar of 102(b) is evaluated on a claim-by-claim basis, the fact that an additional feature covered in a dependent claim may result from the sale of an invention covered in a parent claim does not mean that the parent claim may escape a statutory bar based on that sale. See Lough v. Brunswick Corp., 86 F.3d 1113, 1122 n. 5, 39 USPQ2d 1100, 1107 n. 5 (Fed. Cir. 1996) ( [e]ach claim of the patent must be considered individually when evaluating a public use bar. ). (i) VARIETY OF FACTORS. In determining whether a use is commercial versus experimental, this court has considered a variety of factors relevant to the first part of the Pfaff test, including: (1) the necessity for public testing, (2) the amount of control over the experiment retained by the inventor, (3) the nature of the invention, (4) the length of the test period, (5) whether payment was made, (6) whether there was a secrecy obligation, (7) whether records of the experiment were kept, (8) who conducted the experiment, and (9) the degree of commercial exploitation during testing. See Baker 10 October 2002 CHISUM ON PATENTS CASE REPORTER Oil Tools, Inc. v. Geo Vann, Inc., 828 F.2d 1558, 1564, 4 USPQ2d 1210, 1214 (Fed. Cir. 1987). We have also considered: (10) whether the invention reasonably requires evaluation under actual conditions of use, (11) whether testing was systematically performed, (12) whether the inventor continually monitored the invention during testing, and (13) the nature of contacts made with potential customers. See Seal- Flex, 98 F.3d at 1323, 40 USPQ2d at (j) While the Supreme Court in Pfaff discarded the totality of the circumstances test for determining the existence of an on-sale bar, 525 U.S. at 66 n. 11, 48 USPQ2d at 1646 n. 11, nothing in the Supreme Court s opinion suggests that a weighing of the factual submissions of the parties, particularly on the first prong of the Pfaff test, is precluded. See Weatherchem Corp. v. J.L. Clark, Inc., 163 F.3d 1326, , 49 USPQ2d 1001, 1007 (Fed. Cir. 1998) (weighing facts in applying Pfaff ). To the contrary, the balancing of such facts lies at the heart of what has been termed experimental use negation. See TP Labs., 724 F.2d at 971, 220 USPQ at 582. EZ Dock, Inc. v. Schafer Systems, Inc., 276 F.3d 1347, 61 USPQ2d 189 (Fed. Cir. 2002) SECTION 112 WRITTEN DESCRIPTION OF THE INVENTION ENABLEMENT WRITTEN DESCRIPTION NO ESSENTIAL ELEMENTS TEST CREATED BY GENTRY GALLERY (1998). (1) DRAWINGS. Drawings constitute an adequate description if they describe what is claimed and convey to those of skill in the art that the patentee actually invented what is claimed. Vas-Cath Inc. v. Mahurkar, 935 F.2d 1555, 1563, 19 USPQ2d 1111, 1116 (Fed. Cir. 1991). (2) A statement in Gentry Gallery, Inc. v. Berkline Corp., 134 F.3d 1473, 45 USPQ2d 1498 (Fed. Cir. 1998), to wit, that an inventor considered a feature to be an essential element of his invention and, therefore that his original disclosure serves to limit the permissible breadth of his after-drafted claims, did not announce a new `essential element test mandating an inquiry into what an inventor considers to be essential to his invention and requiring that the claims incorporate those elements. (a) Use of particular language explaining a decision does not necessarily create a new legal test. Rather, in

11 Gentry, we applied and merely expounded upon the unremarkable proposition that a broad claim is invalid when the entirety of the specification clearly indicates that the invention is of a much narrower scope. Id. ( [C]laims may be no broader than the supporting disclosure. ). (b) In Gentry, [t]here was no description or support whatever for the feature, a control, being located anywhere other than on a console. Therefore, a claim was invalid because the location of the control was not limited to the console. (3) A patent concerned a subsea well head. In the written description of the priority application, a workover port was described as extending between two plugs. A first patent issued with a claim requiring the port to extend between the two plugs. In an accused infringer s device, the port extended above the two plugs. The patent owner filed a continuation application and obtained a patent that required that the port extend above a hanger structure, the bottom plug being on top of the hanger structure. Unlike Gentry, the patent s figures show the work port as above the hanger. (4) ONE DRAWING SUPPORTING TWO DESCRIPTIONS. The fact that the same drawing also shows [the work port] between the plugs does not vitiate its disclosure above the tubing hanger. Both descriptions are supported by the same drawing. (5) CLAIM INVENTION IN MORE THAN ONE WAY. An inventor is entitled to claim his invention in more than one way. Cooper Cameron Corp. v. Kvaerner Oilfield Products, Inc., 291 F.3d 1317, 62 USPQ2d 1846 (Fed. Cir. 2002) ENABLEMENT GENETICALLY TOMATO. MODIFIED (1) An applicant s 1986 application did not provide an enabling disclosure of an invention at issue in an interference, which concerned tomato plants genetically modified with a bacterial crystal protein gene. (2) EMBODIMENT: TRANSFORMED TOBACCO PLANTS; OTHER PLANTS, INCLUDING TOMATO, LISTED. The 1986 application described plants transformed with genes that encode the crystal protein. It listed 94 kinds of plants recommended for transformation, including a tomato plant, but it set forth as embodiments only transformed tobacco plants. (3) ERROR IN COUNT CONSTRUCTION. The PTO Board erred in construing the interference s count, which required a tomato plant transformed to comprise a full length Bacillus thuringiensis crystal protein gene capable of encoding a Bacillus thuringiensis crystal protein of about 130 kd under control of a promoter such that said gene is expressible in said plant in amounts insecticidal to Lepidopteran insects. (a) PROTEIN: SIZE VARIATION; MOLECULAR WEIGHT. The crystal protein produced by expression of the gene may vary in size. A protoxin form has a molecular weight of about 130 kd; the activated toxin form has a molecular weight of about 67 kd. (b) The Board erred in construing Count 1 by requiring the insecticidal effect of the transformed tomato plants of the count to be attributable solely to sufficient amounts of the 130 kd Bt crystal protein protoxin. (c) It is sufficient that the crystal protein that produces the insecticidal effects in the plants of the count be the result of the expression of the full length crystal protein gene; the size of the resulting protein is immaterial. (4) FACTUAL FINDINGS ON ENABLEMENT. Despite its error in count construction, the Board s factual findings... on the question of whether [the applicant s 1986 application] would have enabled persons skilled in the art to make and use the transformed tomato plants of the count as of the filing date of the application are supported by substantial evidence. (a) APPLICANT S ARGUMENT RESPONDING TO OPPONENT S EXPERIMENTAL EVIDENCE ON APPLICANT S TOBACCO EXAMPLE. Supporting a finding that the applicant s disclosure of a transformed tobacco plant did not enable a transformed tomato plant was the applicant s own argument that his opponent s experiments attacking the applicant s tobacco example were invalid because the opponent used a completely different strain of tobacco. If, as applicant argued, expression is not consistent among strains of a single species (tobacco), one skilled in the art would not have expected consistency between different species (tobacco and tomato). (b) PRIOR ART REFERENCES SHOWING UNPREDICTABILITY; INVITATIONS TO EXPERIMENT. Several prior art references showed that the transformation of plants with bacterial toxin genes and the expression of such genes created problems apart from those general to the expression of foreign genes in plants. The references involved the expression of full and truncated genes in tobacco and constituted invitation[s] to experiment rather than a report of success. (c) EXPERT TESTIMONY; EXPERIMENTAL EVIDENCE; INFLUENCE OF KNOWLEDGE ACQUIRED AFTER FILING DATE. The Board found that the applicant s CHISUM ON PATENTS CASE REPORTER October