United States: Key Patent Law Decisions Of 2015

In this White Paper, we have attempted to identify and summarize what we believe to be the most significant United States Supreme Court and Federal Circuit cases of 2015. These decisions create important precedent that is likely to be encountered by patent law practitioners in 2016 and beyond.

2015 saw the Federal Circuit endeavor to apply the Supreme Court's new hybrid approach to appellate review of claim construction decisions. In the joint infringement context, 2015 also saw the Federal Circuit attempt to add certainty to the standard for infringement by multiple actors. Likewise, in the induced infringement context, the Supreme Court clarified the required mental state for a finding of inducement. There were also cases discussing remedies and attorneys' fees, issues that are familiar to every patent litigator. Other issues were less familiar, as in the Supreme Court's decision to uphold its half-century-old rule against allowing patent royalties beyond the term of a patent, or the Federal Circuit's decision to maintain the defense of laches.

Another set of important cases in 2015 dealt with administrative agencies and the roles they play in patent law. For example, several cases considered the substantive standards and jurisdiction of the International Trade Commission ("ITC") and the U.S. Patent and Trademark Office ("PTO"). These decisions indicate that the rules governing administrative review will continue to be beneficial for the petitioner, as the Federal Circuit limited courts' authority to review decisions to institute review and upheld the broad standards used for claim construction.

Finally, our White Paper discussing key 2014 cases noted the sharp uptick in the number of patent law cases the Supreme Court had agreed to hear in recent years.1 Between 2000 and 2014, the Supreme Court decided 39 patent-related cases, or an average of slightly less than three cases per year. That trend continued in 2015, as the Supreme Court decided three patent law cases.

2015: KEY PATENT LAW DECISIONS

The key decisions from 2015 encompassed a wide range of issues. Some broader themes that tie these cases together are highlighted below.

Appellate Review of Claim Construction

Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc., 789 F.3d 1335 (Fed. Cir. 2015). In January 2015, the Supreme Court handed down its decision in Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc.,2 holding that underlying factual disputes related to a district court's claim construction should be reviewed for clear error instead of de novo, as the Federal Circuit had long held. While this holding reflected a change in more than 20 years of the Federal Circuit's practice, during which de novo review of all aspects of claim construction decisions was the rule, in practice the new regime of appellate review has had only a marginal effect.

There is no better indicator of this than the Federal Circuit's treatment of the Teva decision on remand. A divided panel of the Federal Circuit stuck to its original view that the district court had erred in holding the term "molecular weight" definite.3 This decision was premised on claim construction: The district court had held that the term "molecular weight" (which in the abstract could refer to any of various types of molecular weight, including "number average," "weight average," and "peak average" molecular weight) actually referred to peak average molecular weight, based on expert testimony that peak average molecular weight was the only kind of molecular weight that could be obtained from the size-exclusion-chromatography data (a chromatogram and calibration curve) set forth in the patent's Example 1.4

The Federal Circuit agreed that the term "molecular weight" does "not have a plain meaning to one of skill in the art."5 And the majority upheld, as not clearly erroneous, "[t]he district court's determination about how a skilled artisan would understand the way in which [size-exclusion-chromatography]-generated chromatogram data reflects molecular weight."6 But the court said that it did not follow that the meaning of "molecular weight," as used in the claims, had to accord with this not clearly erroneous finding. The problem, according to the majority, was that a correct claim construction has to be one that a skilled artisan would give to the claim term—in the words of the Supreme Court's decision in Teva—"in the context of the specific patent claim under review." As the majority explained, "accepting these fact findings does not, as Teva suggests, mean that there now exists a presumption regarding the meaning of the claim term in the art in general or in the context of this patent."7

The context of the patent, including the prosecution history, highlighted the problem. Even though a skilled artisan might understand the meaning of "molecular weight" to be "peak average molecular weight" based on the data provided in Example 1, the patentee had also said, during prosecution of the patent (to overcome an examiner's rejection for indefiniteness), that "molecular weight" meant "weight average molecular weight." And this, the majority concluded, meant that "there is not reasonable certainty that molecular weight should be measured using [peak average molecular weight]."8

The majority was not willing to let the "weight average" representation in the intrinsic record be overcome by expert testimony or factual findings that this statement was scientifically erroneous. In the majority's view, it is the court's job, as a matter of law, to determine whether a proffered construction is consistent with the context provided by the entire patent, such that the document is internally coherent: "A party cannot transform into a factual matter the internal coherence and context assessment of the patent simply by having an expert offer an opinion on it."9 Thus, the majority held that the district court's not clearly erroneous findings still could not compensate for the absence of reasonable certainty in the intrinsic record, and the claim was indefinite.10

Senior Judge Mayer, who has historically urged deferential review of district courts' claim constructions, dissented. He would have found the claim term definite based on the district court's factual findings, giving those findings considerable deference in light of the evidence and testimony reviewed by the district court.11

The Federal Circuit had numerous occasions to apply Teva's hybrid approach to appellate review in 2015. In doing so, however, the court largely preserved for itself the de novo power to review district court claim constructions. Where a district court's claim construction is completed solely based on the intrinsic written patent record, then appellate review of course remains de novo. But even where clear-error review applies to certain factual findings made in the context of claim construction, this is not always the end of the inquiry—those factual findings, even if not clearly erroneous ones, also should be tested against the context of the patent and the intrinsic record. And, where the intrinsic record would yield a different or inconsistent conclusion, the factual findings may either yield to the internal coherence of the intrinsic record, or may—as was the case in Teva—demonstrate that the patent claim is indefinite.

Footnotes

1 See Nix & Castanias, " Key Patent Law Decisions of 2014."

2 135 S. Ct. 831 (2015).

3 See Teva Pharm. USA, Inc. v. Sandoz, Inc., 723 F.3d 1363 (Fed. Cir. 2013), vacated, Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S.Ct. 831 (2015).

4 789 F.3d 1335, 1338-39 (Fed. Cir. 2015).

5 Id. at 1345.

6 Id. at 1341-42.

7 Id. at 1342.

8 Id. at 1345.

9 Id. at 1342.

10 Id. at 1345.

11 Id. at 1345-49 (Mayer, J., dissenting).

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