United States: Federal Circuit Provides Guidance On Divided Infringement, Inducement Of Infringement, And Indefiniteness

Last Updated: January 20 2017
Article by Allen M. Sokal

Patent owners will applaud the Federal Circuit's latest pronouncement on divided infringement, inducement of infringement, and claim definiteness under 35 U.S.C. § 112. Eli Lilly & Co. v. Teva Parenteral Medicines, Inc., Appeal No. 2015-2067 (Fed. Cir. Jan. 12, 2017). On all three issues, the opinion, authored by Chief Judge Prost and joined by Circuit Judges Newman and Dyk, explains in language that patent owners will celebrate why several generic pharmaceutical manufacturers are liable to the innovator manufacturer, Eli Lilly, for infringement.

The patented invention, a method for treating certain types of lung cancer and mesothelioma, in practice is performed by both a physician and a patient. Specifically, to prevent serious side effects of the chemotherapy drug pemetrexed, the method requires pretreatment with two common vitamins: folic acid and vitamin B12. The defendants filed abbreviated new drug applications (ANDAs) with the FDA, including the required labeling mimicking the approved drug's labeling with instructions for physicians, and Paragraph IV certifications alleging that Lilly's patent is invalid and would not be infringed. Although the physician administers the vitamin B12 and pemetrexed, the physician, in accordance with the labeling, instructs the patient to administer the folic acid before the physician administers the pemetrexed. 

Asserted claim 12 is representative:

An improved method for administering pemetrexed disodium to a patient in need of chemotherapeutic treatment, wherein the improvement comprises:

a) administration of between about 350 µg and about 1000 µg of folic acid prior to the first administration of pemetrexed disodium;

b) administration of about 500 µg to about 1500 µg of vitamin B12, prior to the first administration of pemetrexed disodium; and

c) administration of pemetrexed disodium.

Slip op. at 4-5 (emphasis added by the court).

Regarding the issue of infringement, Lilly had two hurdles to clear. First, it had to prove inducement of infringement by the defendants. And second, since one cannot be liable for inducing infringement in the absence of direct infringement, Limelight Networks, Inc. v. Akamai Techs., Inc., 134 S. Ct. 2111 (2014), Lilly had to prove direct infringement by the actor the defendants induced to infringe. The district court had found that Lilly cleared both hurdles, and the Federal Circuit agreed.


The appellate court first addressed direct infringement by the physician. Since the patient performed the step of administering folic acid, the question, one of fact, was whether substantial evidence supported the jury's finding that the patient's performance of that claimed step was sufficiently attributable to the physician that the physician was responsible for direct infringement. The en banc court had unanimously ruled in Akamai Techs, Inc. v. Limelight Networks, Inc., 797 F.3d 1020 (Fed. Cir. 2015), that a single entity is responsible for another's performance of claimed steps if (1) the entity "directs or controls" the other's performance or (2) the entity and the other constitute "a joint enterprise." Id. at 1022. In this case, only the first prong of that test was at issue. Slip op. at 9.

Overruling earlier cases on divided infringement, the Akamai court broadened the requirement for directing or controlling another's performance from solely an agency or contractual relationship by concluding that "liability under § 271(a) can also be found when an alleged infringer conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a patented method and establishes the manner or timing of that performance." Id. at 1023 (citing Metro-Goldwin-Mayer Studios Inc. v. Grokster, Ltd., 545 U.S., 930 (2005)). But in fact, Limelight, the alleged infringer, had a contractual relationship with its customers who performed steps of the claimed method. Thus, the question remained how far Akamai's new test reaches.

The opinion in Lilly suggests that the court is prepared to extend liability for divided infringement even further than the two-prong test it announced in Akamai. Specifically, in Akamai, the court introduced its application of its new two-prong test to the facts of that case as follows:

Today we outline the governing legal framework for direct infringement and address the facts presented by this case. In the future, other factual scenarios may arise which warrant attributing others' performance of method steps to a single actor. Going forward, principles of attribution are to be considered in the context of the particular facts presented.

797 F.3d at 1023. In Lilly, however, the court quoted that language in a way that provides a   broader interpretation than the original seems to require:

In addition to this two-prong test, we observed that, "[i]n the future, other factual scenarios may arise which warrant attributing others' performance of method steps to a single actor. Going forward, principles of attribution are to be considered in the context of the particular facts presented."

Slip op. at 9 (quoting 797 F.3d at 1023). Thus, the court may not look kindly on those who attempt to avoid liability for infringing method claims by dividing performance of the claimed method in a way that appears calculated to avoid Akamai's two-prong test.

The court in Lilly had no difficulty affirming the district court's finding of direct infringement by the physician. The defendants' labeling provided that the physician would condition the benefit of administration of pemetrexed upon the patient's first administering folic acid. The Physician Prescribing Information in the defendants' labeling emphasized that physicians should instruct patients on dosage and scheduling of taking folic acid, and the Patient Information informed patients that physicians might withhold treatment. Lilly's expert witness reinforced the criticality of following those instructions. That evidence satisfied also the physician's establishing the manner or timing of the patient's performance under the Akamai test. The court rejected the defendants' argument that that was "mere guidance or instruction . . . insufficient to show 'conditioning' . . . . [T]he evidence regarding the critical nature of folic acid pretreatment and physicians' practices support a finding that physicians cross the line from merely guiding or instructing patients to take folic acid to conditioning pemetrexed treatment on their administration of folic acid." Slip op. at 12. The court similarly rejected the defendants' arguments that conditioning requires double-checking another's performance or making threats, or imposing a legal obligation as in Akamai. Id. at 13.

In concluding its discussion of divided infringement, the court again hinted that an even broader test than Akamai's two-prong test might apply in the future. "We leave to another day what other scenarios also satisfy the 'direction or control' requirement. The two-prong test that we set forth in Akamai V is applicable to the facts of this case and resolves the existence of underlying direct infringement." Id. at 15.


The court next addressed whether the district court clearly erred in finding that the defendants induced physicians to infringe, noting that Lilly had the burden of proving the defendants' specific intent and action to induce infringement. Id. Relying again on the defendants' labeling, the court upheld that finding. The court reasoned that the instructions in the labeling satisfied the requirement for encouraging, recommending, or promoting the physicians' infringement. Id. at 16. Because the instructions were clear regarding the claimed method, they sufficiently evidenced the defendants' specific intent to induce infringement, regardless of whether some physicians might not follow the instructions. But the court observed that vague instructions, requiring one to go beyond the label to understand allegedly implicit encouragement, would not suffice. Id. at 17. The court concluded, "[i]n sum, evidence that the product labeling that Defendants seek would inevitably lead some physicians to infringe establishes the requisite intent for inducement." Id. at 18.


The court's ruling on indefiniteness, applying the more lenient standard for proving the defense the Supreme Court announced in Nautilus, Inc. v. Biosig instruments, Inc., 134 S. Ct. 2120 (2014), leans toward the stricter standard that Nautilus overruled. The court observed that under 35 U.S.C. § 112, claims read in view of the intrinsic evidence must inform those of ordinary skill in the art about the scope of the invention with reasonable certainty, a question of law that the court reviews de novo. Slip op. at 19. The court further observed, however, that it reviews "subsidiary factual determinations made by the district court based on extrinsic evidence for clear error." Id. at 20.

The evidence demonstrated some ambiguity regarding the construction of "vitamin B12." It had two meanings in the art–cyanocobalamin and also a class of compounds including cyanocobalamin–and the patent's written description used the term both ways. Id. But based on expert testimony (extrinsic evidence) that "vitamin B12" refers to cyanocobalamin when prescribed in the medical field, the court affirmed the district court's holding that the claims were not invalid.

The defendants relied on additional evidence, however, of indefiniteness. Claim 1, which Lilly did not assert, reads as follows:

  1. A method of administering pemetrexed disodium to a patient in need thereof comprising administering an effective amount of folic acid and an effective amount of a methylmalonic acid lowering agent followed by administering an effective amount of pemetrexed disodium, wherein

the methylmalonic acid lowering agent is selected from the group consisting of vitamin B12, hydroxycobalamin, cyano-10-chlorocobalamin, aquocobalamin perchlorate, aquo-10-cobalamin perchlorate, azidocobalamin, cobalamin, cyanocobalamin, or chlorocobalamin.

Id. at 22 (emphasis added). The defendants argued that if vitamin B12 means cyanocobalamin, the Markush group, a methylmalonic acid lowering agent, lists the same compound twice. Id. But the court reasoned that although it has in some instances construed claim terms to avoid redundancy, in this instance doing so would violate the doctrine of claim differentiation. Id. at 23. Specifically, because claim 2, which depends on claim 1, requires that the methylmalonic acid lowering agent is vitamin B12, claim 2 would not further limit claim 1 if "vitamin B12" referred to a class of compounds rather than cyanocobalamin. "[F]aced with an interpretation that would read redundancy into claim 1 and another that would violate the doctrine of claim differentiation, we hold that the claims here support the former result over the latter." Id.

On all three issues discussed above, patent owners will want to rely on this case.  Regarding indefiniteness, however, a safer course would be to define in the patent's written description all claim terms that could possibly be deemed ambiguous rather than create ambiguity with conflicting definitions.

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