While the impact of Alice Corp. v. CLS Bank International1 on early case strategy has been explored extensively, few commentators have addressed how Alice may impact jury trials.
This article seeks to address this issue, including how Alice provides a separate invalidity defense that bypasses certain patent-friendly validity doctrines, such as motivation to combine and the secondary considerations of nonobviousness and how practitioners might tailor jury instructions, verdict forms, and trial evidence when an Alice defense will be presented to the jury.
Background: Alice and Berkheimer
In a progression of seminal opinions culminating in Alice Corp. Pty. Ltd. v. CLS Bank International, the U.S. Supreme Court rejuvenated the often-ignored defense of patent ineligibility under Section 101. Courts and patent practitioners have attempted to apply the Supreme Court's guidance in litigation, with one notable consequence being the prevalence of early patent ineligibility motions under Rule 12 of the Federal Rules of Civil Procedure.
But often overlooked in the discussions about the impact of Alice is how patent ineligibility can affect the nature and outcome of patent trials. While this consideration is immediately relevant to practitioners heading to trial, it should also influence overall case strategy, including each side's initial evaluation of the likelihood of success, discovery strategy, expert theories and development of litigation themes.
The Alice test for patent ineligibility has two parts. First, courts determine whether the claim at issue is directed to patent ineligible subject matter — a law of nature, natural phenomenon or abstract idea.2 Second, courts evaluate whether the claim recites an inventive concept, such that it covers more than just ineligible subject matter and "well-understood, routine, and conventional" activity.3 This article focuses primarily on Alice Step 2.
Although the Alice test is formulated in simple terms, commentators, legislators and even sitting U.S. Court of Appeals for the Federal Circuit judges have argued that the Alice inquiry addresses questions best left to other provisions of the Patent Act, such as Sections 102, 103 and 112.4 Indeed, because "groundbreaking, innovative, or even brilliant discovery does not by itself satisfy the § 101 inquiry," patent ineligibility provides an independent avenue for invalidating patents that otherwise pass muster under the rigorous legal tests of Sections 102, 103 and 112.5
Courts and practitioners also have struggled with whether the Alice test is purely legal or involves underlying factual questions. The Federal Circuit clarified this point in Berkheimer v. HP Inc., holding that "whether a claim element or combination of elements is well-understood, routine and conventional to a skilled artisan in the relevant field is a question of fact."6 Thus, at least Alice Step 2 involves underlying factual questions.7
In addition to impacting early case strategy, Alice defenses can have a case-altering impact at trial.8 This impact is best illustrated by comparing the Alice test to obviousness under Section 103. An invention is invalid for obviousness if "the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains."9
While the terms "well-understood, routine, and conventional" for Alice Step 2 may appear nearly synonymous with "obvious" in common parlance, the Alice inquiry need not delve into such issues as:
- The requirement that the scope and content of the prior art teach each and every element of the claim at issue;10
- Motivation to combine;11
- The doctrine of analogous prior art;12 and
- The secondary considerations of nonobviousness.13
That is, the Alice test need not involve a detailed limitation-by-limitation analysis of the prior art or an examination of the nuanced factual issues underlying motivation to combine. Nor does the Alice test depend on the teachings of any specific prior art reference, let alone address whether a reference is analogous prior art.
Further, the Alice test does not trigger the secondary considerations of nonobviousness, such as commercial success, praise and teaching away, which can salvage the validity of a prima facie obvious patent claim. Thus, the Alice test avoids many of the patent-friendly doctrines underlying other invalidity defenses, including those guiding the analysis of obviousness under Section 103.
Moreover, as a separate and independent defense, Alice allows for additional instructions from the judge calling the validity of the patents into doubt. Alice's terminology — e.g., well-understood, routine and conventional — provides three nearly analogous conception expressions for jurors to latch on to. Patent eligibility instructions also tend to be succinct and squarely focusing on the well-understood, routine and conventional inquiry, which again favors defendants.
By contrast, other types of invalidity instructions — particularly those for obviousness under Section 103 — tend to be long and complex because they must reflect the associated burden-shifting tests, such as motivation-to-combine and the secondary considerations.
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1 Alice Corp. v. CLS Bank Int'l, 573 U.S. 208 (2014).
2 Alice, 573 U.S. at 217.
3 Id. at 225 (citing Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 72-72 (2012)).
4 Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC, 927 F.3d 1333, 1335 (Fed. Cir. 2019) (Lourie, J., concurring in the denial of rehearing en banc); id. at 1337 (Hughes, J., concurring); id. (Dyk, J., concurring); id. at 1344 (Chen, J., concurring); id. at 1352 (Moore, J., concurring); id. at 1363 (Newman, J., dissenting); id. at 1370 (Stoll, J., dissenting); id. at 1371 (O'Malley, J., dissenting); Am. Axle & Mfg., Inc. v. Neapco Holdings LLC, 939 F.3d 1355, 1369 (Fed. Cir. 2019) (Moore, J., dissenting); Sens. Chris Coons, (D-Del.) & Thom Tillis (R-N.C.) What Coons And Tillis Learned At Patent Reform Hearings, Law360 (June 21, 2019, 8:10 PM EDT), https://www.law360.com/articles/1171672; Ryan Davis, Kappos Calls for Abolition Of Section 101 Of Patent Act, Law360 (Apr. 12, 2016, 4:32 PM EDT), https://www.law360.com/articles/783604.
5 Ass'n. for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 591 (2013).
6 Berkheimer v. HP Inc., 881 F.3d 1360, 1368 (Fed Cir. 2018). See Aatrix Software, Inc. v. Green Shades Software, Inc., 890 F.3d 1354, 1355-57 (Fed. Cir. 2018) (Moore, J., concurring in denial of rehearing en banc).
7 See Search & Social Media Partners v. Facebook, Inc., No 17-cv-1120-LPS, 2019 WL 581616, at *7 (D. Del. Feb. 13, 2019) ("Aatrix and Berkheimer perhaps place new emphasis on the reality that Alice Step 2 can involve factual disputes, but that too is not a change in the law.").
8 The author represented the defendant in C. R. Bard, Inc. v. AngioDynamics, Inc., No. 1:15-cv-000218 (D. Del.), where patent ineligibility was litigated at the pleading stage and through trial. Because the district court dismissed the case on the fourth day of trial for, inter alia, patent ineligibility, this issue was not given to the jury.
9 35 U.S.C. § 103(a); see Proctor & Gamble Co. v. Teva Pharms. USA, Inc., 566 F.3d 989, 994 (Fed. Cir. 2009).
10 KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398, 417-18 (2007).
11 Id. at 418-21; Arctic Cat Inc. v. Bombardier Recreational Prods. Inc., 876 F.3d 1350, 1362-63 (Fed. Cir. 2017).
12 In re Pagliaro, 657 F.2d 1219, 1224 (C.C.P.A. 1981).
13 Transocean Offshore Deepwater Drilling, Inc. v. Maersk Drilling USA, Inc., 699 F.3d 1340, 1349 (Fed. Cir. 2012).
Originally published by Law360
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