IP News

Supreme Court Grants Certiorari Review of Obviousness Doctrine

On June 26, 2006, the U.S. Supreme Court granted certiorari and will review the decision in Teleflex, Inc. v. KSR Int'l Co., 119 F. App'x 282 (Fed. Cir. 2005). In Teleflex, the Federal Circuit vacated the grant of summary judgment, finding that the district court incorrectly applied its 'teaching-suggestion-motivation' test. According to the Fe-deral Circuit, the district court failed to make factual findings showing the ”specific understanding or principle within the knowledge of a skilled artisan that would have motivated one with no knowledge of [the] invention to make the combination in the manner claimed.” Id. at 289 (quoting In re Kotzab, 217 F.3d 1365, 1371 (Fed. Cir. 2000).

The question presented in KSR's petition was: 'Whether the Federal Circuit has erred in holding that a claimed invention cannot be held 'obvious,' and thus unpatentable under 35 U.S.C. '103(a), in the absence of some proven 'teaching, suggestion, or motivation' that would have led a person of ordinary skill in the art to combine the relevant prior art teachings in the manner claimed.'

Writ of Certiorari in Lab. Corp. Case Was 'Improvidently Granted'

On June 22, 2006, the U.S. Supreme Court determined the writ of certiorari in Lab. Corp. of Am. Holdings v. Metabolite Labs., Inc. was 'improvidently granted' after deciding in October 2005 to review the case. The question presented was: 'Whether a method patent setting forth an indefinite, undescribed, and non-enabling step directing a party simply to 'correlat[e]' test results can validly claim a monopoly over a basic scientific relationship used in medical treatment such that any doctor necessarily infringes the patent merely by thinking about the relationship after looking at a test result.'

This case involves claim 13 of U.S. Patent 4,940,658 ('the '658 patent'), which recites: '[a] method for detecting a deficiency of cobalamin or folate [B vitamins] in warm-blooded animals comprising the steps of: assaying a body fluid for an elevated level of total homocysteine; and correlating an elevated level of total homocysteine in said body fluid with a deficiency of cobalamin or folate.' Deficiencies in cobalamin and folate can cause illnesses such as vascular disease, cognitive dysfunction, birth defects, and cancer. Once detected, however, a deficiency can be treated with vitamin supplements.

Lab. Corp. claimed in its petition that, according to Metabolite's theory, 'every one of the thousands of doctors who orders one of the millions of homocysteine tests performed for patients nationwide necessarily infringes [the '658 patent] because the doctor looks at the test result and allegedly thinks that the result might indicate something about the existence or non-existence of a vitamin deficiency' (emphasis in original).

The five justices that voted to dismiss the appeal did so without issuing a decision. Justice Stephen Brey-er issued a dissenting opinion, joined by Justices John Paul Stevens and David Souter. The dissent recognized that Lab. Corp. had not alleged that the '658 patent was unpatentable under '101 of the Patent Act and that the Federal Circuit had not weighed in on this issue. Nonetheless, Justice Breyer argued that the Supreme Court should have decided the case because Lab. Corp. had, in essence, presented this argument to the lower courts, and because the issue had been fully briefed and argued.

After concluding that the patented process at issue was a 'natural phenomenon' and outside the scope of patent-eligible subject matter defined by '101 of the Patent Act, Justice Breyer argued that the public interest warranted a prompt decision in this case. According to the dissent:

[These] restrictions may inhibit doctors from using their best medical judgment; they may force doctors to spend unnecessary time and energy to enter into license agreements; they may divert resources from the medical task of health care to the legal task of searching patent files for similar simple correlations; they may raise the cost of healthcare while inhibiting its effective delivery.

Supreme Court Denies Cubatabaco's Petition in COHIBA Case

On June 19, 2006, the U.S. Supreme Court denied a petition to review the decision by the U.S. Court of Appeals for the Second Circuit in Empresa Cubana del Tabaco v. Culbro Corp., 399 F.3d 462 (2d Cir. 2005) (ruling that Cuban company was barred from acquiring U.S. trademark rights via 'famous marks' doctrine due to Cuban trade embargo). The Second Circuit's decision re-versed a ruling by the Southern District of New York, which found in favor of Cubatabaco on its trademark infringement claim.

The dispute in this case centers on the use of the COHIBA mark on
premium cigars. In the district court, Cubatabaco argued that it owned the COHIBA mark because General Cigar abandoned its COHIBA registration in 1987, and by that time, Cubatabaco's COHIBA mark was sufficiently well known so as to be protectable under the 'famous marks doctrine.' The district court agreed with Cubatabaco, even though Cubatabaco had never used its mark in the United States.

On appeal, the Second Circuit held that Cubatabaco could not obtain U.S. trademark rights because of the trade embargo. First, the court noted that the Embargo Regulations prohibit a 'broad range of transactions involving property in which a Cuban entity has an interest.' The regulations broadly define 'property' to include trademark rights. As such, the court found that Cubatabaco's acquisition of the COHIBA mark through the famous marks doctrine would constitute a prohibited transfer. Finally, the court found that Cubatabaco was not authorized to acquire the COHIBA mark by either a general or a specific license. Therefore, the court reversed the district court's finding of trademark infringement.

After the Supreme Court's decision, Cubatabaco announced that it will pursue its pending application for U.S. government permission to seek judicial protection from the Treasury Department's Office of Foreign Assets Control, which administers the blockade. In seeking U.S. permission, Cubatabaco will rely on the Paris Convention for the Protection of Industrial Property, which provides that the United States should honor 'famous marks' from foreign countries.

Federal Circuit Denies Petition for Rehearing in Apotex Case

On June 22, 2006, the Federal Circuit denied a petition to rehear en banc the decision in SmithKline Beecham Corp. v. Apotex Corp., 439 F.3d 1312 (Fed. Cir. 2006). The issue in Apotex was whether U.S. Patent 4,721,723 (the '723 patent) anticipated U.S. Patent 6,113,944 (the '944 patent). The '723 patent is a product patent claiming the paroxetine compound, the active ingredient in Paxil'. The '944 product-by-process patent claims paroxetine made by an allegedly novel process.

The district court ruled that the '944 patent was anticipated by the '723 patent, relying on Scripps Clinic & Research Foundation v. Genentech, Inc., 927 F.2d 1565 (Fed. Cir. 1991). The district court argued that Scripps held that the process steps in a product-by-process claim were not claim limitations. In so doing, the district court perceived a conflict between the decisions in Scripps and Atlantic Thermoplastics Co. v. Faytex Corp., 970 F.2d 834 (Fed. Cir. 1992) (process steps in a product-by-process claim are claim limitations). In Apotex, the Federal Circuit agreed with the district court and held that 'anticipation by an earlier product patent cannot be avoided by claiming the same product more narrowly in a product-process claim … While the process set forth in the product-by-process claim may be new, that novelty can only be captured by obtaining a process claim.' Id. at 1318-19. The Federal Circuit, however, did not address the Scripps and Atlantic Thermoplastics decisions.

Judges Pauline Newman, Randall Rader, and Arthur Gajarsa dissented from the decision to deny the rehearing petition. While first claiming that the decisions in Scripps and Atlantic Thermoplastics are not conflicting, Judge Newman stated: 'there has been enough misperception and casual misstatement [regarding product-by-process claims]' to warrant rehearing. In a separate opinion, Judge Rader stated: '[w]hether all the words in a product-by-process claim are limiting is a question that patent attorneys, trial courts, and apparently this court, still cannot confidently answer.' Judge Gajarsa joined both dissenting opinions.

Eric Agovino is an associate in the New York office of Kenyon & Kenyon LLP. He can be reached at 212-908-6858.

Supreme Court Grants Certiorari Review of Obviousness Doctrine

On June 26, 2006, the U.S. Supreme Court granted certiorari and will review the decision in Teleflex, Inc. v. KSR Int'l Co. , 119 F. App'x 282 (Fed. Cir. 2005). In Teleflex, the Federal Circuit vacated the grant of summary judgment, finding that the district court incorrectly applied its 'teaching-suggestion-motivation' test. According to the Fe-deral Circuit, the district court failed to make factual findings showing the ”specific understanding or principle within the knowledge of a skilled artisan that would have motivated one with no knowledge of [the] invention to make the combination in the manner claimed.” Id. at 289 (quoting In re Kotzab, 217 F.3d 1365, 1371 (Fed. Cir. 2000).

The question presented in KSR's petition was: 'Whether the Federal Circuit has erred in holding that a claimed invention cannot be held 'obvious,' and thus unpatentable under 35 U.S.C. '103(a), in the absence of some proven 'teaching, suggestion, or motivation' that would have led a person of ordinary skill in the art to combine the relevant prior art teachings in the manner claimed.'

Writ of Certiorari in Lab. Corp. Case Was 'Improvidently Granted'

On June 22, 2006, the U.S. Supreme Court determined the writ of certiorari in Lab. Corp. of Am. Holdings v. Metabolite Labs., Inc. was 'improvidently granted' after deciding in October 2005 to review the case. The question presented was: 'Whether a method patent setting forth an indefinite, undescribed, and non-enabling step directing a party simply to 'correlat[e]' test results can validly claim a monopoly over a basic scientific relationship used in medical treatment such that any doctor necessarily infringes the patent merely by thinking about the relationship after looking at a test result.'

This case involves claim 13 of U.S. Patent 4,940,658 ('the '658 patent'), which recites: '[a] method for detecting a deficiency of cobalamin or folate [B vitamins] in warm-blooded animals comprising the steps of: assaying a body fluid for an elevated level of total homocysteine; and correlating an elevated level of total homocysteine in said body fluid with a deficiency of cobalamin or folate.' Deficiencies in cobalamin and folate can cause illnesses such as vascular disease, cognitive dysfunction, birth defects, and cancer. Once detected, however, a deficiency can be treated with vitamin supplements.

Lab. Corp. claimed in its petition that, according to Metabolite's theory, 'every one of the thousands of doctors who orders one of the millions of homocysteine tests performed for patients nationwide necessarily infringes [the '658 patent] because the doctor looks at the test result and allegedly thinks that the result might indicate something about the existence or non-existence of a vitamin deficiency' (emphasis in original).

The five justices that voted to dismiss the appeal did so without issuing a decision. Justice Stephen Brey-er issued a dissenting opinion, joined by Justices John Paul Stevens and David Souter. The dissent recognized that Lab. Corp. had not alleged that the '658 patent was unpatentable under '101 of the Patent Act and that the Federal Circuit had not weighed in on this issue. Nonetheless, Justice Breyer argued that the Supreme Court should have decided the case because Lab. Corp. had, in essence, presented this argument to the lower courts, and because the issue had been fully briefed and argued.

After concluding that the patented process at issue was a 'natural phenomenon' and outside the scope of patent-eligible subject matter defined by '101 of the Patent Act, Justice Breyer argued that the public interest warranted a prompt decision in this case. According to the dissent:

[These] restrictions may inhibit doctors from using their best medical judgment; they may force doctors to spend unnecessary time and energy to enter into license agreements; they may divert resources from the medical task of health care to the legal task of searching patent files for similar simple correlations; they may raise the cost of healthcare while inhibiting its effective delivery.

Supreme Court Denies Cubatabaco's Petition in COHIBA Case

On June 19, 2006, the U.S. Supreme Court denied a petition to review the decision by the U.S. Court of Appeals for the Second Circuit in Empresa Cubana del Tabaco v. Culbro Corp. , 399 F.3d 462 (2d Cir. 2005) (ruling that Cuban company was barred from acquiring U.S. trademark rights via 'famous marks' doctrine due to Cuban trade embargo). The Second Circuit's decision re-versed a ruling by the Southern District of New York, which found in favor of Cubatabaco on its trademark infringement claim.

The dispute in this case centers on the use of the COHIBA mark on
premium cigars. In the district court, Cubatabaco argued that it owned the COHIBA mark because General Cigar abandoned its COHIBA registration in 1987, and by that time, Cubatabaco's COHIBA mark was sufficiently well known so as to be protectable under the 'famous marks doctrine.' The district court agreed with Cubatabaco, even though Cubatabaco had never used its mark in the United States.

On appeal, the Second Circuit held that Cubatabaco could not obtain U.S. trademark rights because of the trade embargo. First, the court noted that the Embargo Regulations prohibit a 'broad range of transactions involving property in which a Cuban entity has an interest.' The regulations broadly define 'property' to include trademark rights. As such, the court found that Cubatabaco's acquisition of the COHIBA mark through the famous marks doctrine would constitute a prohibited transfer. Finally, the court found that Cubatabaco was not authorized to acquire the COHIBA mark by either a general or a specific license. Therefore, the court reversed the district court's finding of trademark infringement.

After the Supreme Court's decision, Cubatabaco announced that it will pursue its pending application for U.S. government permission to seek judicial protection from the Treasury Department's Office of Foreign Assets Control, which administers the blockade. In seeking U.S. permission, Cubatabaco will rely on the Paris Convention for the Protection of Industrial Property, which provides that the United States should honor 'famous marks' from foreign countries.

Federal Circuit Denies Petition for Rehearing in Apotex Case

On June 22, 2006, the Federal Circuit denied a petition to rehear en banc the decision in SmithKline Beecham Corp. v. Apotex Corp. , 439 F.3d 1312 (Fed. Cir. 2006). The issue in Apotex was whether U.S. Patent 4,721,723 (the '723 patent) anticipated U.S. Patent 6,113,944 (the '944 patent). The '723 patent is a product patent claiming the paroxetine compound, the active ingredient in Paxil'. The '944 product-by-process patent claims paroxetine made by an allegedly novel process.

The district court ruled that the '944 patent was anticipated by the '723 patent, relying on Scripps Clinic & Research Foundation v. Genentech, Inc. , 927 F.2d 1565 (Fed. Cir. 1991). The district court argued that Scripps held that the process steps in a product-by-process claim were not claim limitations. In so doing, the district court perceived a conflict between the decisions in Scripps and Atlantic Thermoplastics Co. v. Faytex Corp. , 970 F.2d 834 (Fed. Cir. 1992) (process steps in a product-by-process claim are claim limitations). In Apotex, the Federal Circuit agreed with the district court and held that 'anticipation by an earlier product patent cannot be avoided by claiming the same product more narrowly in a product-process claim … While the process set forth in the product-by-process claim may be new, that novelty can only be captured by obtaining a process claim.' Id. at 1318-19. The Federal Circuit, however, did not address the Scripps and Atlantic Thermoplastics decisions.

Judges Pauline Newman, Randall Rader, and Arthur Gajarsa dissented from the decision to deny the rehearing petition. While first claiming that the decisions in Scripps and Atlantic Thermoplastics are not conflicting, Judge Newman stated: 'there has been enough misperception and casual misstatement [regarding product-by-process claims]' to warrant rehearing. In a separate opinion, Judge Rader stated: '[w]hether all the words in a product-by-process claim are limiting is a question that patent attorneys, trial courts, and apparently this court, still cannot confidently answer.' Judge Gajarsa joined both dissenting opinions.

Eric Agovino is an associate in the New York office of Kenyon & Kenyon LLP. He can be reached at 212-908-6858.