Tuesday, May 19, 2015

Should Claim Construction be a Matter of Law?

Cobalt Pharmaceuticals Co v Bayer Inc / drospirenone (NOC) 2015 FCA 116 Stratas JA: Pelletier, Webb JJA aff’g 2013 FC 1061 Hughes J (blogged here and here)
            2,382,426 / drospirenone / YAZ

In Cobalt / Drospirenone the FCA held that “[t]he Federal Court’s construction of the patent is to be reviewed on the basis of correctness” [12]. However, Stratas and Webb JA went on to argue at some length, in obiter comments, that it would make more sense to apply a deferential standard [16]-[24]. (Pelletier JA did not join in this potion of the decision; he did not disagree with the comments, but rather expressed no opinion on the basis that it was not necessary to do so for the disposition of the appeal [105]).

Stratas JA pointed out that “a court nearly always reads a patent through goggles supplied by the experts whom the judge considers to be credible and accurate,” and “[o]ften the experts’ testimony stretches beyond opinion evidence and goes into factual matters within their knowledge that are relevant to the construction exercise” [17], [18]. As is well-recognized, if an inquiry is heavily fact dependent, this militates in favour of a deferential standard of review [18], [20].

These are compelling arguments against reviewing claims construction on a correctness standard. I also agree with Stratas JA’s observation that “doctrine of comity among judges will ensure there is sufficient consistency and certainty in the meaning of patents” [21]. But I don’t think these points, valid though they are, lead to the conclusion that a generally deferential standard of review should apply. In principle at least, the problem of claim construction is a mixed question of fact and law. Ideally, the trial judge would use the testimony of the experts to educate herself as to the meaning of all the technical terms, and then, armed with that knowledge, would construe the claim herself. The first aspect of the inquiry is factual, while the second is legal. It would follow that in principle the mixed standard – deferential review except for extricable legal questions, which are reviewed for correctness – should be applied. This is the standard which applies in obviousness and utility for example, as Stratas JA notes [48], [55]. Stratas JA appealed to Sattva Capital 2014 SCC 53, for the proposition that “even legal documents may be subject to review on a deferential standard” [24]. Indeed, Sattva Capital does illustrate that legal documents are not necessarily reviewed on a correctness standard, but to be precise, the SCC held that a mixed standard of review was applicable to the contract in question [53].

I don’t think I am disagreeing with Stratas JA in suggesting that the appropriate standard is mixed standard. While he repeatedly referred to “a deferential approach” [20] or “a deferential standard” [24], or “according deference” [22], his comments were mainly directed at showing why a pure correctness standard was problematic, and in referring to “a” deferential standard, he appears to have intended to capture any standard more deferential than correctness. This is directly implied by his reference to both Sattva Capital and the USSC decision in Teva v Sandoz as endorsing a deferential standard, as both of those cases endorse a mixed standard.

In any event, even if a mixed standard is applicable in principle, can it really be applied in practice? Stratas JA made this point by asking rhetorically, “How are appellate judges supposed to cleave off those aspects of claim construction that flow from the trial judge’s appreciation of expert evidence from the words of the claim per se?” [20]. It seems to me that the answer is yes, sometimes they can. This is illustrated by Stratas JA’s own decision in Cobalt / Drospirenone. While he argued that a deferential standard would be preferable, he recognized that review for correctness is settled law, and correctness is the standard he actually applied [25].

The claim of the ‘426 patent in question, Claim 31, was to “drospirenone particles” [27] and the question was whether this should be construed as being limited to micronized particles [28]. In making the argument that it should be so limited, Cobalt pointed to references to micronized form in several points in the specification. In rejecting Cobalt’s argument, Stratas J noted that “Patents are not to be construed in a tendentious way. Rather, we must examine the patent as a whole construing the language of the claims with due regard to the inventor’s purpose through the eyes of the skilled reader: Whirlpool, [2000 SCC 67]” [31]. This, it seems to me, is a point of law, as is indicated by the fact that Stratas JA cited the authority of Whirlpool as support. He also noted that while some of the claims did explicitly claim “micronized drospirenone particles,” others, including the claim at issue, were not so limited [37]. Had the inventors intended to limit Claim 31 to micronized particles, they would have done so explicitly, as they did in other claims. This is not a question of what “micronized” means, or anything else which is informed by technical expertise, but is rather a matter of general grammar and interpretative principles, which are more squarely within the expertise of a judge than a technical expert. Similarly, Stratas JA pointed to a passage in the specification stating that “Instead of providing the drospirenone in micronized form, it is possible to [use other techniques to promote rapid dissolution]” [35]. To explicitly give micronized form as but one alternative in the specification supports the view that not all of the claims are restricted to micronized form. One can come to this conclusion without knowing what “micronized” means. Without getting into the niceties of whether these are all strictly extricable questions of law, at least they are questions which are squarely within the expertise of a judge, rather than a technical expert.

This distinction is important because the law / fact question goes not only to the standard of appellate review, but also to the role of the trial judge in the construction of the patent. Indeed, the statement by the SCC that is cited as authority for the correctness standard – “claims construction is a matter of law for the judge” – goes to the latter point (Whirlpool [61], cited at [12]). The full passage is as follows:

The appellants object that the "vane" controversy ought to have been foreclosed by the Agreed Statement of Facts where the parties agreed that the appellants' flex vane machine infringed the '803 patent subject to the removable sleeve issue. However, claims construction is a matter of law for the judge, and he was quite entitled to adopt a construction of the claims that differed from that put forward by the parties.

In the question of whether Claim 31 was restricted to micronized particles, it would no doubt be possible for a trial judge to decide this matter purely as a question of fact by considering the evidence of expert witnesses. But this would require the expert witness to testify eg that a skilled person would in fact construe the claims by looking to the patent as a whole with due regard to the inventor’s purpose, and that a skilled person would note that some claims did use this language, and would therefore infer that the claims that were not so restricted were broader, and so on. And another expert would no doubt testify to the contrary. The trial judge would likely then decide that the evidence of the expert who advanced grammatically peculiar interpretations was to be discounted. But if the trial judge could and should discount the evidence of an expert who testifies to an ungrammatical reading for the reason that the reading is ungrammatical, it is more straightforward for the trial judge to simply say directly she can consider matters of grammatical reading herself, without evidence from technology experts. That, it seems to me, is the gist of the SCC statement in Whirlpool.

In summary, Stratas JA has given strong reasons not to review claim construction on a pure correctness standard, but there is a stronger argument for a mixed standard than for a wholly deferential standard. Stratas JA’s comments were directly primarily to the problems with the correctness standard, and I do not see his remarks as ruling out the mixed standard.

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