IP News

The Limited Applicability of the 'Tangential Relation' Exception

In Cross Medical Prods., Inc. v. Medtronic Sofamor Danek, Inc., No. 05-1415, the alleged infringer appealed a district court ruling that it infringed claim 5 of U.S. Patent 5,474,555 ('the '555 patent') under the doctrine of equivalents even though the patentee narrowed the claim during prosecution.

In 2003, Cross Medical sued Medtronic for infringement of the '555 patent, which is directed to polyaxial screws for the internal fixation of the spine. Following the district court's grant of Cross Medical's motions for partial summary judgment on validity and infringement of claim 5, Medtronic immediately appealed, despite ongoing proceedings at the district court. While the first appeal was pending, Medtronic redesigned its polyaxial screws in an attempt to avoid infringement. Specifically, Medtronic relied on a narrowing amendment made during prosecution.

As originally filed, one element of claim 5 required a 'seat means including a vertical axis and first threads.' The claim was rejected, however, for lack of antecedent basis and lack of support in the specification, for obviousness type double patenting, and for anticipation. In response, the applicant amended the claim to recite (in part): 'seat means including a vertical axis and first threads which extend in the direction of said vertical axis toward said lower bone interface to a depth below the diameter of the rod when it is in the rod receiving channel.' The applicant also amended the specification to address the 35 U.S.C. '112 '1 rejection.

The district court found that Medtronic's new screw had threads that terminated above the rod diameter and thus did not literally infringe claim 5. However, the district court still found infringement under the doctrine of equivalents' function-way-result test. In so holding, the district court rejected Medtronic's prosecution history estoppel argument, opining that the amendment was to adequately describe and enable the invention, not to avoid prior art, and therefore 'the rationale [for the amendment] was no more than tangentially related to Medtronic's new screw design ' ' Medtronic then filed a second appeal based upon the district court's finding of infringement of the redesigned screws.

With regard to the redesigned screws, the Federal Circuit reversed and remanded, holding that prosecution history estoppel barred application of the doctrine of equivalents. The court opined that the tangential relation criterion is very narrow, that it focuses on the patentee's objectively apparent reason for the narrowing amendment, and that the reason 'should be discernible from the prosecution history of record.' Applying that standard, the Cross Medical court found that the prosecution history of the '555 patent shows a narrowing amendment 'contains the equivalent in question.' Further, the court determined that the accused equivalent did not capture the aspect of the invention relating to the amendment (i.e., threads extending to a depth below the top of the stabilizer').

The Federal Circuit similarly rejected the patentee's alternative argument that the alleged equivalent was 'unforeseeable at the time of the amendment.' The court determined that the use of an 'undercut or recess' (as was found in the redesigned screw) was an old and well-known fundamental of basic machining that was entirely foreseeable.

Judge Randall Ray Rader issued a concurring opinion in which he emphasized the narrowness of the tangential relation principle. Judge Rader expressed his distaste for the principle altogether stating that, 'by its nature, [it] undermines principles of public notice.'

Federal Circuit Finds Declaratory Judgment Jurisdiction

In Teva Pharms., Inc. v. Novartis Pharms. Corp., No. 06-1181, the Federal Circuit reversed the district court's dismissal of Teva's declaratory judgment action. Novartis holds a New Drug Application ('NDA') for three strengths of the drug Famvir'. Concurrently with its NDA filing, Novartis listed five patents in the FDA's Orange Book ' one of which ('the '937 patent') ' covered the active ingredient in Famvir' and the others which covered therapeutic uses of the same. In 2004, Teva filed an Abbreviated New Drug Application ('ANDA') with the FDA in which it certified that its drug did not infringe any of the five Novartis Famvir' Orange Book patents, and that the patents were invalid. Novartis then brought an infringement suit against Teva on the '937 patent alone and did not include the related therapeutic use patents. After Novartis filed suit, Teva brought a declaratory judgment action on the four remaining method patents to establish 'patent certainty,' which is provided for under a 2003 amendment to the ANDA statute and allows an ANDA applicant to bring a civil suit for a declaratory judgment if the NDA holder does not bring an infringement suit within 45 days after receiving notice of an ANDA certification. The district court granted Novartis' motion to dismiss for lack of subject matter jurisdiction, opining that under prior Federal Circuit precedent, Teva had failed to establish a reasonable apprehension of imminent suit on the four remaining patents. The instant appeal followed.

Applying the recent Supreme Court case, Medimmune, Inc. v. Genentech, Inc., 127 S. Ct. 764 (2007), the Federal Circuit reversed the district court's dismissal of Teva's declaratory judgment suit. The Federal Circuit held that its 'two part reasonable-apprehension-of-suit test,' which required: 1) an explicit threat or other action by the patentee, which creates a reasonable apprehension on the part of the declaratory plaintiff that it will face an infringement suit, and 2) present activity which could constitute infringement or concrete steps taken with the intent to conduct such an activity, no longer applied. Rather, the Teva court noted that in Medimmune, the Supreme Court disagreed with the 'reasonable apprehension of imminent suit' test and reaffirmed that the 'actual controversy' requirement in the Declaratory Judgment Act is the same as the 'Cases' and 'Controversies' requirement in Article III. The Federal Circuit therefore followed Medimmune's teaching to look at 'all the circumstances' to determine whether Teva has a justiciable Article III controversy.

Applying the 'all the circumstances' test, the court ruled that Teva has an 'injury in fact' (the only Article III requirement in dispute) and therefore has a justiciable Article III controversy. The court opined that by suing under 35 U.S.C. '271(e)(2)(A) on Teva's single act of infringement (the filing of an ANDA application), Novartis placed into actual dispute the soundness of Teva's ANDA and Teva's ability to secure approval of the ANDA. Further, Novartis was not precluded from pursuing additional infringement suits (even outside the 45-day statutory window). The court concluded that this continued threat of litigation was a present injury creating a justiciable controversy giving rise to declaratory judgment jurisdiction.

Viacom Sues YouTube for Copyright Infringement

On March 13, 2007, Viacom filed a complaint in the Southern District of New York, Viacom Int'l, Inc. v. Youtube, Inc., No. 07-2103, alleging that YouTube and its parent Google are liable for direct copyright infringement based upon the public performance, display, and reproduction of Viacom's copyrighted works. The complaint further alleges that YouTube is liable for inducement of copyright infringement by running its Web site with the object of promoting YouTube users to infringe plaintiff's copyrights. The complaint further alleges that YouTube's enablement of the direct infringement by YouTube users constitutes contributory infringement. Finally, Viacom asserts that YouTube is vicariously liable for the infringing acts of YouTube users, alleging that YouTube has the right and ability to supervise YouTube users' infringing conduct and to prevent YouTube users from infringing plaintiffs' copyrighted audiovisual works. Viacom is seeking $1 billion in damages. The case could have far-reaching implications regarding a Web site's duty to police its site for copyrighted content.

Matt Berkowitz is an associate in the New York office of Kenyon & Kenyon LLP. He can be reached at 212-908-6462.

The Limited Applicability of the 'Tangential Relation' Exception

In Cross Medical Prods., Inc. v. Medtronic Sofamor Danek, Inc., No. 05-1415, the alleged infringer appealed a district court ruling that it infringed claim 5 of U.S. Patent 5,474,555 ('the '555 patent') under the doctrine of equivalents even though the patentee narrowed the claim during prosecution.

In 2003, Cross Medical sued Medtronic for infringement of the '555 patent, which is directed to polyaxial screws for the internal fixation of the spine. Following the district court's grant of Cross Medical's motions for partial summary judgment on validity and infringement of claim 5, Medtronic immediately appealed, despite ongoing proceedings at the district court. While the first appeal was pending, Medtronic redesigned its polyaxial screws in an attempt to avoid infringement. Specifically, Medtronic relied on a narrowing amendment made during prosecution.

As originally filed, one element of claim 5 required a 'seat means including a vertical axis and first threads.' The claim was rejected, however, for lack of antecedent basis and lack of support in the specification, for obviousness type double patenting, and for anticipation. In response, the applicant amended the claim to recite (in part): 'seat means including a vertical axis and first threads which extend in the direction of said vertical axis toward said lower bone interface to a depth below the diameter of the rod when it is in the rod receiving channel.' The applicant also amended the specification to address the 35 U.S.C. '112 '1 rejection.

The district court found that Medtronic's new screw had threads that terminated above the rod diameter and thus did not literally infringe claim 5. However, the district court still found infringement under the doctrine of equivalents' function-way-result test. In so holding, the district court rejected Medtronic's prosecution history estoppel argument, opining that the amendment was to adequately describe and enable the invention, not to avoid prior art, and therefore 'the rationale [for the amendment] was no more than tangentially related to Medtronic's new screw design ' ' Medtronic then filed a second appeal based upon the district court's finding of infringement of the redesigned screws.

With regard to the redesigned screws, the Federal Circuit reversed and remanded, holding that prosecution history estoppel barred application of the doctrine of equivalents. The court opined that the tangential relation criterion is very narrow, that it focuses on the patentee's objectively apparent reason for the narrowing amendment, and that the reason 'should be discernible from the prosecution history of record.' Applying that standard, the Cross Medical court found that the prosecution history of the '555 patent shows a narrowing amendment 'contains the equivalent in question.' Further, the court determined that the accused equivalent did not capture the aspect of the invention relating to the amendment (i.e., threads extending to a depth below the top of the stabilizer').

The Federal Circuit similarly rejected the patentee's alternative argument that the alleged equivalent was 'unforeseeable at the time of the amendment.' The court determined that the use of an 'undercut or recess' (as was found in the redesigned screw) was an old and well-known fundamental of basic machining that was entirely foreseeable.

Judge Randall Ray Rader issued a concurring opinion in which he emphasized the narrowness of the tangential relation principle. Judge Rader expressed his distaste for the principle altogether stating that, 'by its nature, [it] undermines principles of public notice.'

Federal Circuit Finds Declaratory Judgment Jurisdiction

In Teva Pharms., Inc. v. Novartis Pharms. Corp., No. 06-1181, the Federal Circuit reversed the district court's dismissal of Teva's declaratory judgment action. Novartis holds a New Drug Application ('NDA') for three strengths of the drug Famvir'. Concurrently with its NDA filing, Novartis listed five patents in the FDA's Orange Book ' one of which ('the '937 patent') ' covered the active ingredient in Famvir' and the others which covered therapeutic uses of the same. In 2004, Teva filed an Abbreviated New Drug Application ('ANDA') with the FDA in which it certified that its drug did not infringe any of the five Novartis Famvir' Orange Book patents, and that the patents were invalid. Novartis then brought an infringement suit against Teva on the '937 patent alone and did not include the related therapeutic use patents. After Novartis filed suit, Teva brought a declaratory judgment action on the four remaining method patents to establish 'patent certainty,' which is provided for under a 2003 amendment to the ANDA statute and allows an ANDA applicant to bring a civil suit for a declaratory judgment if the NDA holder does not bring an infringement suit within 45 days after receiving notice of an ANDA certification. The district court granted Novartis' motion to dismiss for lack of subject matter jurisdiction, opining that under prior Federal Circuit precedent, Teva had failed to establish a reasonable apprehension of imminent suit on the four remaining patents. The instant appeal followed.

Applying the recent Supreme Court case, Medimmune, Inc. v. Genentech, Inc. , 127 S. Ct. 764 (2007), the Federal Circuit reversed the district court's dismissal of Teva's declaratory judgment suit. The Federal Circuit held that its 'two part reasonable-apprehension-of-suit test,' which required: 1) an explicit threat or other action by the patentee, which creates a reasonable apprehension on the part of the declaratory plaintiff that it will face an infringement suit, and 2) present activity which could constitute infringement or concrete steps taken with the intent to conduct such an activity, no longer applied. Rather, the Teva court noted that in Medimmune, the Supreme Court disagreed with the 'reasonable apprehension of imminent suit' test and reaffirmed that the 'actual controversy' requirement in the Declaratory Judgment Act is the same as the 'Cases' and 'Controversies' requirement in Article III. The Federal Circuit therefore followed Medimmune's teaching to look at 'all the circumstances' to determine whether Teva has a justiciable Article III controversy.

Applying the 'all the circumstances' test, the court ruled that Teva has an 'injury in fact' (the only Article III requirement in dispute) and therefore has a justiciable Article III controversy. The court opined that by suing under 35 U.S.C. '271(e)(2)(A) on Teva's single act of infringement (the filing of an ANDA application), Novartis placed into actual dispute the soundness of Teva's ANDA and Teva's ability to secure approval of the ANDA. Further, Novartis was not precluded from pursuing additional infringement suits (even outside the 45-day statutory window). The court concluded that this continued threat of litigation was a present injury creating a justiciable controversy giving rise to declaratory judgment jurisdiction.

Viacom Sues YouTube for Copyright Infringement

On March 13, 2007, Viacom filed a complaint in the Southern District of New York, Viacom Int'l, Inc. v. Youtube, Inc., No. 07-2103, alleging that YouTube and its parent Google are liable for direct copyright infringement based upon the public performance, display, and reproduction of Viacom's copyrighted works. The complaint further alleges that YouTube is liable for inducement of copyright infringement by running its Web site with the object of promoting YouTube users to infringe plaintiff's copyrights. The complaint further alleges that YouTube's enablement of the direct infringement by YouTube users constitutes contributory infringement. Finally, Viacom asserts that YouTube is vicariously liable for the infringing acts of YouTube users, alleging that YouTube has the right and ability to supervise YouTube users' infringing conduct and to prevent YouTube users from infringing plaintiffs' copyrighted audiovisual works. Viacom is seeking $1 billion in damages. The case could have far-reaching implications regarding a Web site's duty to police its site for copyrighted content.

Matt Berkowitz is an associate in the New York office of Kenyon & Kenyon LLP. He can be reached at 212-908-6462.