IP Update, Vol. 15, No. 12, December 2012

Edited by Paul Devinsky and Rita Weeks

Patents / Preliminary Injunction

Federal Circuit Rules It's Own Standards Apply When Considering Preliminary Injunctions

by Roozbeh Gorgin

Addressing the issue of preliminary injunction standards in patent cases, the U.S. Court of Appeals for the Federal Circuit concluded that when it comes to determining whether a preliminary injunction should be issued in patent cases, the Federal Circuit's preliminary injunction standards apply, rather than those of the regional circuit in which the district court hearing the patent case sits. Revision Military Inc. v. Balboa Manufacturing Co., Case No. 11-1628 (Fed. Cir., Nov. 27, 2012) (Newman, J.).

Revision Military filed a patent infringement case in the U.S. District Court for the District of Vermont (part of the U.S. Court of Appeals for the Second Circuit), alleging that Balboa Manufacturing's new "Bravo" design protective goggles (also called "Bobster Bravo") copied and infringed Revision's "Bullet Ant" goggles covered by design patents. After the suit was filed, Revision moved for a preliminary injunction, seeking to enjoin Balboa from making and selling the Bobster Bravo goggles while the litigation was pending. In denying Revision's preliminary injunction motion the district court applied the Second Circuit's heightened standard of proof of likelihood of success on the merits, instead of the Federal Circuit standard for consideration of whether to impose such relief. Revision appealed.

The Federal Circuit, in reversing the district court's decision, held that the trial court should have used the standard articulated by the Federal Circuit:

"With respect to the applicable standard, the Federal Circuit has explained that a preliminary injunction enjoining patent infringement . . . 'involves substantive matters unique to patent law and, therefore, is governed by the law of this court . . .'"

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"Substantive matters of patent infringement are unique to patent law, and thus the estimated likelihood of success in establishing infringement is governed by Federal Circuit law," the panel said. "Revision need not meet the Second Circuit's heightened 'clear or substantial likelihood' standard, but rather the Federal Circuit's standard of whether success is more likely than not."

Practice Note: By indicating that preliminary injunction issues related to patent cases are "a patent specific issue," an interesting question is whether the Federal Circuit's ruling here is conflict with the Supreme Court's guidance in eBay v. MercExchange, a case in which the Supreme Court considered whether the test for injunctive relief for patent infringement should be treated differently than it is treated in other areas of law, and ultimately ruled that it should not.

Patents / Enablement

Preliminary Testing of Medical Devices in Animals Enables Their Use in Humans

by Atabak Royaee, Ph.D.

The U.S. Court of Appeals for the Federal Circuit concluded the claims of a patent directed to a medical device for implementation into humans were enabled by animal tests or in vitro data where human testing is inappropriate. Edwards Lifesciences AG v. CoreValve, Inc., Case No. 11-1215; -1257 (Fed. Cir., Nov. 13, 2012) (Newman, J.).

Edwards sued CoreValve in district court for infringement of a patent directed to a prosthetic device called a "transcatheter heart valve." The valve is mounted on a collapsible stent and implanted in the heart by a balloon catheter, thereby avoiding open heart surgery and its associated risks.

CoreValve challenged the validity of the patent for lack of enablement based on the undisputed fact that at the time the patent application was filed, the stent/valve prosthesis had been implanted only in pigs and that testing in pigs did not enable use in humans. CoreValve pointed out that the various experimental implants in pigs were not always successful and that design changes were made after the patent application was filed.

Edwards did not deny that more developmental work was required at the time of filing. One of the co-inventors had stated, in a contemporaneous report, that "questions such as size reduction, material and design optimization, and stent valve sterilization, remain unsolved," and that "much more work had to be done before anybody ever even contemplated using this for a human." Edwards' expert witness testified that at the time the patent application was filed, it was a device to perform testing on and not a device to move in and treat patients.

Nonetheless, the jury found for Edwards, and the lower court found the patent was enabled. CoreValue appealed.

The Federal Circuit affirmed. Citing the Manual of Patent Examining Procedure, the Court explained that it has long been recognized that when experimentation on human subjects is inappropriate, as in the testing and development of drugs and medical devices, the enablement requirement may be met by animal tests or in vitro data. The Court confirmed this general rule, which has been elaborated in various situations.

To determine whether the subject matter claimed required undue experimentation, the Court considered the In re Wands factors. The Court reasoned that there was evidence that the stent/valve prosthetic device was successfully implanted in pigs, that pigs were a standard experimental animal for heart valve research, and that witnesses for both sides discussed the vascular anatomies of pigs and the established use of porcine valves in humans.

As such, the Court concluded that substantial evidence supported the jury verdict that invalidity on the ground of non-enablement had not been proved by clear and convincing evidence.

Patents / Obviousness

Rare Finding of Non-Obviousness Based Solely on Secondary Considerations

by Donna M. Haynes

Addressing the validity and infringement of two patents, the U.S. Court of Appeals for the Federal Circuit reversed a lower court judgment as a matter of law (JMOL) that the patented invention was invalid and not infringed, reinstating a jury's $15 million damages award. Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc., Case No. 11-1555 (Fed. Cir., Nov. 15, 2012) (Moore, J.).

The two Transocean patents related to a deepwater drilling vessel having "dual-activity" technology. The dual-activity technology permits simultaneous drilling and finishing operations by the concurrent use of two cooperating advancing stations, thereby improving operational efficiency. The defendant, Maersk, entered into a contract with Statoil, offering for sale a deepwater drilling vessel having Transocean's dual-activity technology. The contract contained an option-to-modify clause pending the outcome of unrelated district court litigation involving the patents-in-suit. Maersk modified the vessel to avoid infringement of the claims before delivering it to Statoil.

On remand from a prior Federal Circuit decision finding that Maersk had presented a prima facie case of obviousness, a jury found that Transocean's evidence of secondary considerations of non-obviousness was sufficient to overcome the prima facie case. The jury found that Transocean's patents were valid and infringed by Maersk's offer for sale, awarding $15 million in damages. The district court then granted Maersk's JMOL. The district court held that Transocean's patents were invalid, that Maersk did not infringe and that Transocean was not entitled to damages.

On appeal, the Federal Circuit began by reasserting its prior holding that Maersk presented a prima facie case of obviousness. It then went on to explain that "[t]he establishment of a prima facie case ... is not a conclusion on the ultimate issue of obviousness ... [and] evidence rising out of the so-called 'secondary considerations' must always when present be considered en route to a determination of obviousness." The Court held that when evaluating such secondary considerations, the strength of the prima facie showing of non-obviousness may be examined.

The Federal Circuit recognized that it has not often found objective evidence sufficient to overcome a prima facie case of obviousness. Here however, Transocean presented, and the jury found credible, seven distinct factors supporting non-obviousness—commercial success, industry praise, unexpected results, copying, industry skepticism, licensing and long-felt but unsolved need. The Federal Circuit agreed, concluding that Transocean had presented substantial evidence to support the jury finding. As such, the Court stated that Transocean established precisely the sort of case where the objective evidence establishes that an invention appearing to have been obvious in light of the prior art was not.

Analyzing the jury finding of infringement, the Federal Circuit held that Maersk's offer for sale of an infringing drilling rig to Statoil was an act of direct infringement and reinstated the jury's $15 million damages award. According to the Court, although Maersk did not, in the end, deliver an infringing rig to Statoil, it nonetheless infringed by offering a dual-activity rig for sale.

The Federal Circuit also reversed the district court's grant of JMOL that the asserted patent claims were not enabled and the district court's grant of Maersk's motion for a new trial.

Patents / Inventorship

Section 256 Inventorship Claim Does Not Accrue Until the Patent Issues

by D. Jeremy Harrison

Addressing challenges to inventorship under 35 U.S.C. § 256, the U.S. Court of Appeals for the Federal Circuit reversed a district court's grant of summary judgment that a claim for inventorship was barred by laches, finding that a claim for correction of inventorship does not accrue until the patent issues. Hor v. Chu, Case No. 211-1540 (Fed. Cir., Nov. 14, 2012) (Prost, J.) (Reyna, J., concurring).

Defendant Ching-Wu Chu, a professor of physics at the University of Houston, and plaintiffs Pei-Herng Hor and Ruling Meng worked together at the University of Houston...