Federal Circuit Review - September 2021

| Irfan LateefDaniel Kiang

September 2021 Federal circuit Newsletter (Japanese)

September 2021 Federal Circuit Newsletter (Chinese)


Arguments to the Patent Office That Contradict Information Submitted to the FDA Support an Inference of Deceptive Intent

In Belcher Pharmaceuticals v. Hospira, Inc., Appeal No. 20-1799, the Federal Circuit held that a patentee committed inequitable conduct by advancing an argument during patent prosecution that contradicted the patentee’s prior arguments and evidence submitted to the FDA.

Belcher Pharmaceuticals, through its Chief Science Officer, Mr. Rubin, sought and received approval from the FDA for a drug formulation of l-epinephrine.  To obtain this approval, Belcher relied on prior literature that described the well-known effects of a 2.8 to 3.3 pH range on the racemization of l‑epinephrine.

Mr. Rubin later helped prosecute a patent application for Belcher’s drug formulation.  To distinguish prior art that described a similar formulation with a pH range of 2.2 to 5.0, Belcher argued that a range of 2.8 to 3.3 was “unexpectedly found to be critical” by the inventor for reducing racemization.  Accepting this argument, the USPTO issued a patent to Belcher.

Belcher asserted its patent against Hospira in an infringement suit under the Hatch-Waxman Act.  Hospira argued that the patent was unenforceable due to inequitable conduct.  The district court agreed, finding that Mr. Rubin had failed to disclose prior art references that were but-for material to patentability because they disclosed the allegedly unexpected pH range.  The court also found that Mr. Rubin was aware of these references, and their disclosure of the claimed pH range, due to his work on the FDA approval of Belcher’s drug formulation.  Thus, Belcher’s patent was unenforceable.  Belcher appealed.

Belcher argued on appeal that Rubin believed the references he withheld from the Patent Office were irrelevant because they failed to disclose certain features other than the claimed pH range.  The Federal Circuit found no clear error in the district court’s finding that this excuse was implausible and not credible in view of the record evidence.  The Federal Circuit thus affirmed the district court’s judgment of unenforceability.



The Location of Witnesses and Relevant Evidence Still Reigns Supreme in Venue Decisions

In In Re: Juniper Networks, Inc., Appeal No. 21-160, the Federal Circuit held that a party’s general presence in a forum is an insufficient reason to deny transfer when the majority of witnesses and relevant evidence are in the desired venue.

WSOU Investments LLC (“Brazos”) sued Juniper in W.D. Tex. for patent infringement. Juniper moved to transfer venue to N.D. Cal. under 28 U.S.C. § 1404(a) based on the fact that its headquarters and relevant operations are in Sunnyvale, CA and its argument that Brazos conducted little to no business in W.D. Tex. Specifically, Juniper argued that Brazos described itself as a “patent assertion entity,” had only recently opened an office in W.D. Tex., had only one of its officers in Texas, had two of its officers, its CEO, and its president in California, and that the agreement assigning to Brazos much of its patent portfolio listed a California address for Brazos. Brazos countered that it had two employees in the W.D. Tex. office and Juniper had a small office in W.D. Tex. as well. However, Juniper represented that its Texas office had no involvement with the accused products and that office was closed shortly after the action was filed.

Judge Albright denied the motion for transfer, finding Jupiter failed to “sufficiently differentiate[]” exactly where relevant documents were located, neither party claimed witnesses were unwilling to testify, the convenience of witnesses is entitled to little weight given the parties’ control over their witnesses, both parties had business in W.D. Tex., Juniper failed to show the accused product development occurred entirely in the N.D. Cal., and the W.D. Tex. would reach trial more quickly than the N.D. Cal.

The Federal Circuit vacated Judge Albright’s Order, finding an abuse of discretion, and directed transfer to N.D. Cal. under 28 U.S.C. § 1404(a). The Federal Circuit reaffirmed that the convenience of witnesses, whether party witnesses or not, is “probably the single most important factor” in the analysis, and in this case 11 witnesses were in N.D. Cal. while only one was in W.D. Tex. The Court also held Juniper’s general presence in W.D. Tex. was not enough to establish a local interest when the majority of the relevant evidence was in N.D. Cal., the fact that some evidence might be in neither forum does not weigh against transfer, and Brazos’s presence in W.D. Tex. appeared recent, “relatively insubstantial,” and looked like forum shopping. Finally, the Court held that court congestion, not aggressive scheduling, was a relevant, though speculative, consideration, but W.D. Tex. and N.D. Cal. showed no significant differences in time-to-trial statistics, and as a patent assertion entity Brazos did not have a threatened market position requiring quick resolution.



Serial Post-Grant Review Filings and the Limits of PTO Discretion Under §325(d)

In In Re: Vivint, Inc., Appeal No. 20-1992, the Federal Circuit held that even when a request for ex parte reexamination raises a substantial new question of patentability, the Patent Office can exercise its discretion to deny the request under 35 USC § 325(d) where the petitioner has engaged in a pattern of filing “similar, serial challenges to the same patent.”

Accused patent infringer filed a request for ex parte reexamination of Vivint’s patent after the Patent Office had previously denied institution of’s three petitions for inter partes review of the same patent.  The Patent Office denied the third IPR petition because it reflected’s “undesirable, incremental petitioning” practice of using prior Board decisions as a roadmap to correct past deficiencies.  Although’s subsequent reexamination request largely “repackaged” arguments from its third IPR petition, the Patent Office ordered reexamination.  The examiner ultimately rejected all claims, and Vivint appealed to the Board.  The Board affirmed.  Vivint appealed to the Federal Circuit.

The Federal Circuit vacated and remanded with instructions for the Patent Office to dismiss the reexamination.  The Federal Circuit agreed with the Board that’s “repackaged” arguments raised a “substantial new question of patentability” as required under 35 U.S.C. § 303(a).  The Federal Circuit held that a question of patentability is new until it has been considered and decided on the merits.  Because the Patent Office denied the third IPR petition based on’s abusive filing practices, the arguments in that petition were never addressed on the merits.

Nonetheless, the Federal Circuit held that the Patent Office abused its discretion and acted arbitrarily and capriciously by ordering reexamination of Vivint’s patent.  Under § 325(d), the Patent Office has discretion to deny a petition for IPR or a request for reexamination where “the same or substantially the same prior art or arguments previously were presented to the Office.”  The Federal Circuit determined that the Patent Office implicitly exercised this discretion when it declined to institute the third IPR petition based on’s “similar, serial challenges to the same patent.”  The Federal Circuit held that, in light of that decision, it was arbitrary and capricious for the Patent Office to subsequently grant the same petitioner’s “nearly identical reexamination request.”    

The Federal Circuit emphasized that its ruling is narrow and does not stand for a blanket bar on reexamination where a particular challenger has engaged in improper serial filing.  The Federal Circuit noted that “there can be a public interest in reexamination that goes beyond the interest, or propriety of behavior, of a particular challenger.”  This public interest, the court explained, is reflected in the Director’s authority under § 303(a) to launch a reexamination “[o]n his own initiative.”  Such authority, however, was not at issue in the present case.