Wednesday, July 31, 2019

Infringement of Use Claim by Manufacture

Eli Lilly Canada Inc v Apotex Inc 2019 FC 884 Tabib J
            2,226,784 / 2,371,684 / 2,379,948 / tadalafil

This procedural decision raises the question of whether a claim in the form of “a composition for use in the treatment of” a disorder can be infringed by manufacture of the composition intended for treatment of the disorder, even if the composition is not actually used. The broader question is the extent to which relatively subtle differences in claim structure can result in substantive differences in what constitutes infringement.

Lilly’s 784 patent has claims of the general form “a composition for the treatment of ED comprising tadalafil.” Lilly won in NOC proceedings against various generics based on its 784 patent, which were therefore prohibited from obtaining an NOC until its expiry. When the 784 patent did expire, several generics received their NOC and immediately launched. Lilly brought an action for infringement based on several patents, including the 784 patent, even though no product was sold until after the 784 patent expired.

In this motion Lilly sought leave to amend to add an allegation that the generics infringed by reason of the manufacture, import and stockpiling of tadalafil for the treatment of ED prior to the expiry of the 784 Patent [13]. The defendant generics opposed the amendment. None of them sold or could sell their product in Canada until the expiry of the ‘784 patent, so the question is whether manufacture and stockpiling could constitute infringement of a claim of this type. The generics argued in effect that because the 784 patent is a “use” patent, they could only infringe by inducement, and since direct infringement is an element of inducement, and there was no actual use, and therefore no direct infringement, prior to the expiry of the 784 patent and launch of the generic product, it followed that there could be no infringement by manufacture and stockpiling [18]. While the issue arose because of the particular facts, the question is of more general significance, because if Lilly is right, a claim to a composition for treatment of a disorder can be directly infringed by manufacture for that purpose, without the need to establish use.

Tabib J rejected the defendants’ argument. She noted the potential distinction between claims of the form “a composition for use in the treatment of” and those drafted as “use of a composition in the treatment of” [23]. The former claim is arguably a claim to the composition itself, which might therefore be infringed by manufacture and stockpiling. Without going through the cases reviewed by Tabib J, her conclusion that it is reasonably arguable that a claim to “a composition for use” is a composition claim [33], strikes me as clearly correct. With that said, there is merit to the basic argument made by the generics, that both types of claim are really directed to a second medical use. If the substance of the invention is the same, it would seem to be undesirable that idiosyncratic differences in claim structure could lead to substantive differences in outcome. But maybe the answer to that is that claim to “use of a composition in the treatment of” should also be infringed by manufacture for purpose of the claimed use.

In the end, Tabib J allowed the amendment by Lilly, subject to bifurcation to address scheduling issues.

Wednesday, July 24, 2019

Claim Construction Not Applied in Infringement Analysis

Evolution Technologies Inc v Human Care Canada Inc 2019 FCA 209 Laskin JA: Dawson, Stratas JJA rev’g 2018 FC 1302 supplementary reasons 2018 FC 1304 Elliott J
            2,492,392

At trial, Elliott J held that Human Care’s 392 patent related to “rollators” – a “walker” with wheels, primarily used to assist the elderly with mobility issues – was valid and infringed by Evolution Tech: see here. The FCA has now reversed, on the basis that Elliott J erred in law because her finding of infringement was not based on the construction she had arrived at in the claim construction analysis [4], [24], and there was no evidence to support a finding of infringement on the basis of that construction [26]. The FCA accordingly held that infringement was not established, and allowed the appeal. Evolution had relied in part on the prosecution history, invoking the recently enacted subsection 53.1(1) of the Act [3], but this played no part in the FCA’s reasoning.

Thursday, July 18, 2019

Revised Paper on Overbreadth In Canadian Patent Law

I have just posted a revised version of my draft paper on Overbreadth In Canadian Patent Law. In the earlier version I had somehow overlooked Apotex v AstraZeneca 2017 FCA 9, a key FCA decision on the “roads to Brighton” problem. That section of the paper is re-written, but my overall conclusions are not changed; on the contrary, Apotex v AstraZeneca strengthens my view that overbreadth is not required as an independent ground of invalidity

Wednesday, July 17, 2019

Claims May Be Construed with Reference to the Entire Specification

Tetra Tech EBA Inc v Georgetown Rail Equipment Co 2019 FCA 203 Dawson JA: Pelletier, Webb JJA rev’g Georgetown Rail Equipment Co v Rail Radar Inc 2018 FC 70 Fothergill J
             2,572,082 / 2,766,249

In Georgetown Rail v Rail Radar (blogged here), Fothergill J held that Georgetown’s 082 and 249 patents were valid and infringed by Tetra Tech EBA Inc, dismissing the main validity attack, that was based on obviousness. The FCA has now reversed.

The appeal relating to the 249 patent turned on claim construction. The FCA reversed Forthergill J on claim construction, presumably applying a correctness standard,given that claim construction is a matter of law [89]. In NOVA v Dow 2016 FCA 216 [15] the FCA suggested that in some circumstances, particularly where claim constructions turns on the trial judge’s assessment of expert evidence concerning the meaning of terms used in the claims, trial judges might be given “some leeway” in claim construction. Dawson JA made no reference to this quasi-deferential standard, but her decision is not inconsistent with it. In this case, the disputed construction did not turn on an appreciation of expert evidence, but rather on the interplay between the disclosure and claims; that is, a quintessentially judicial function of interpreting a written document. The obviousness of the claims alleged to have been infringed followed straightforwardly from the new claim construction [125]-[130].

A controversial point related to claim construction is whether having recourse to the disclosure as an aid to construing the claims is always permissible, or is permissible only if the claims are ambiguous when read on their own: see here and here. Dawson JA did not directly address the controversy, but she began her analysis by remarking (my emphasis):

[104] I begin the construction exercise with the Patent’s disclosure, mindful that while claims may be construed with reference to the entire specification, the disclosure may not be used to enlarge or contract the scope of a claim as written.

This passing remark strikes me as a succinct statement of the correct approach. It is always permissible to construe claims with reference to the disclosure, but it is never permissible to use the disclosure to change the scope of the claims, once the claims have been construed in light of the disclosure. (That is, absent any invocation of essential elements or Actavis-style expanded protection.) The line between construing the claim in light of the disclosure and importing limitations from the disclosure into the claims may sometimes be a bit blurry, but the law is full of lines that are sometimes blurry. This particular distinction strikes me as conceptually sound and easy enough to apply in most cases.

The appeal relating to the 082 patent turned on obviousness, with the key point being that the common general knowledge must be taken into account in assessing obviousness [13]. This, of course, does not represent new law.

The patents related to an automated system and method for inspecting railroad track using a laser and camera to collect information about the railroad track, plus a processor to analyze the information according to a specified algorithm: FC [16], [31]. The individual components were known and there was no suggestion of inventive ingenuity in adapting those components to implement the algorithm: FC [146]. One of the problems addressed by the 082 patent was identifying “plate cut” which occurs when a tie plate, which fastens the rail to the wooden crosstie, cuts into the crosstie as a result of the vibration of the passing trains. Fothergill J noted that all of the components and technology used by the claimed invention were known in the prior art, but “none of the prior art identifies plate cut or rail seat abrasion as problems to be solved, or suggests solutions similar to those disclosed by the 082 and 249 Patents”: FC [146]. However, as Dawson JA emphasized, this statement was based on the six items of prior art that were submitted in Tetra’s expert report, and did not consider whether those elements were found in the common general knowledge as accepted by Fothergill J: FCA [60], [62]. So, plate cut itself was well known in the prior art, and indeed was required to understand the undefined term “sunken plate” (a plate that has sunk into the tie through plate cut) used in the patent itself [18], so it must have been obvious to identify plate cut as a problem [66]. There was also a problem in how to identify plate cut, because plate cut is hidden when viewed from above since it occurs under the tie plate. The 082 patent solved this problem by comparing the height of the crosstie with the height of the tie plate [67]. But, as Dawson JA noted, “This was the very measurement human inspectors took when trying to identify plate cut” [68]; Georgetown’s own expert testified to that effect [70]. Thus the method of identifying plate cut was known in the prior art, and Forthergill J had found that there was nothing inventive in the way that that known solution was implemented by the automated system.

The strength of these points is illustrated by Georgetown’s strained response, that “although defects such as plate cut and rail seat abrasion were defects known to ‘railway people’, these defects were not held by the Court to be within the common general knowledge of the person skilled in the art” [22]. That is, the problem and solution adopted by the patent would not have been obvious to a person such as myself, wholly ignorant of railways. But Dawson JA had no difficulty in dismissing this argument, both in light of Fothergill J’s express findings regarding the common general knowledge, and in light of the general principle that “[t]he identification of the ordinary person skilled in the art should be consistent with the specification of the patent” [26].

Forthergill J’s failure to address obviousness in light of the common general knowledge was an error of law [63]. The principle applied by the FCA is well established and the decision does not reflect any change in the law.

Wednesday, July 10, 2019

Patent Remedies and Complex Products: Toward a Global Consensus

I’m very pleased to announce the release by Cambridge Univ. Press of Patent Remedies and Complex Products: Toward a Global Consensus (Brad Biddle, Jorge L. Contreras, Brian J. Love & Norman V. Siebrasse eds., Cambridge Univ. Press 2019). Here is the description:

Through a collaboration among twenty legal scholars from eleven countries in North America, Europe and Asia, Patent Remedies and Complex Products presents an international consensus on the use of patent remedies for complex products such as smartphones, computer networks and the Internet of Things. It covers the application of both monetary remedies like reasonable royalties, lost profits, and enhanced damages, as well as injunctive relief. Readers will also learn about the effect of competition laws and agreements to license standards-essential patents on terms that are 'fair, reasonable and non-discriminatory' (FRAND) on patent remedies. Where national values and policy make consensus difficult, contributors discuss the nature and direction of further research required to resolve disagreements.

The book is the work of the project on International Patent Remedies for Complex Products (INPRECOMP), which brought together the aforementioned twenty scholars for two workshops, plus innumerable rounds of collaborative work in drafting the individual chapters. At the second workshop, a panel of prominent judges and practitioners with experience in complex products litigation provided feedback on a draft version of the work, and the book is aimed not only at academics but also lawyers, judges, and other professionals involved in the global patent system.

Patent Remedies and Complex Products is available in print from Amazon or direct from Cambridge U Pr and also in an open-access version which provides the full text in pdf and html for free download and viewing.

The project was managed through the Center for Law, Science and Innovation (CLSI) at Arizona State University's Sandra Day O'Connor College of Law and primarily funded by a gift to CLSI from Intel.

While I’m on the subject of patent remedies for complex products, I’ll mention my book chapter with Professor Tom Cotter, "Judicially Determined FRAND Royalties," in Jorge L Contreas (ed), The Cambridge Handbook of Technical Standardization Law: Competition, Antitrust, and Patents (Cambridge University Press, 2017), Chapter 23. It is a comprehensive review of the basis for calculation of FRAND royalties in all the cases that were decided by the time it was written (which still includes most of the leading cases), and I suggest it would be of interest to any lawyer involved in FRAND royalty litigation