Patent Case Summaries September 6, 2013

Federal Circuit Patent Case Summaries for the Week Ending September 6, 2013

The following is a summary of the precedential patent-related opinions issued by the Court of Appeals for the Federal Circuit for the week ending September 6, 2013. Mike Connor prepared this edition.    


Case Summaries

Claim Interpretation: Ordinary Meaning
Claim Interpretation: Intrinsic Evidence: Specification

Bayer Cropscience AG v. Dow Agrosciences LLC, No. 13-1002 (Fed. Cir. (D. Del.) Sept. 3, 2013). Opinion by Taranto, joined by Prost and Bryson.

The Federal Circuit affirmed the district court’s summary judgment of noninfringement on the basis that the patent owner’s infringement claim depended on an overly-broad and incorrect claim construction.

Bayer Cropscience AG (“Bayer”) owns U.S. Patent No. 6,153,401 (“the ’401 patent”), which is directed to genetically modifying plants to provide resistance to a commonly used herbicide, 2,4-dichlorophenoxyacetic acid (“2,4-D”). The inventors determined that bacteria could grow on 2,4-D and convert 2,4-D to 2,4-dichlorophenol (“2,4-DCP”), and they identified a gene in the bacteria coded for enzymes that catalyze 2,4-D into 2,4-DCP. The scientists believed at the time that the enzymatic reaction required oxygen, but were unsure what happened to one of the two oxygen atoms during the reaction. In keeping with common scientific belief at the time of the patent application in 1989, the specification characterized the enzymes as monooxygenases to describe where one of the two atoms ends up in water and the second is incorporated into a product. This belief was later proved wrong, as scientists eventually discovered in 1993 that the enzymes were dioxygenase because both atoms are incorporated into products other than water. Bayer knew of this discovery but did not alter the claims of the ’401 patent, which issued in 2000.

Dow Agrosciences LLC (“Dow”) produces genetically modified seeds that are resistant to 2,4-D and includes modified genes that code for enzymes that are dioxygenases. In December 2010, Bayer sued Dow and accused Dow’s seeds of infringing the ’401 patent. During trial, the district court construed “biological activity of 2,4-D monooxygenase” to mean the established scientific meaning of monooxygenase. Under this construction, the district court granted Dow summary judgment of noninfringement.

On appeal, the Federal Circuit reviewed the claim construction de novo and held that accepting Bayer’s arguments was problematic. Specifically, the Federal Circuit decided that the word “monooxygenase” has had a clear established meaning (i.e., an enzyme catalyzing a reaction in which one oxygen atom is incorporated into water, and the second oxygen atom is incorporated into the product). Nevertheless, Bayer attempted to define the phrase “2,4-D monooxygenase” as bringing about cleavage of the side chain of 2,4-D without requiring any additional limitations. However, the Federal Circuit determined that the specification of the ’401 patent did not describe or attempt to define “monooxygenase” in any different fashion than the accepted meaning in the scientific community.

Further, Bayer’s proposed construction of “monooxygenase” attempts to encompass a broad class of enzymes defined by their function of cleaving the side chain of 2,4-D, but the specification of the ’401 patent merely identified one gene sequence and the enzyme it encoded. The Appeals Court held that this broad construction is incorrect because the claim would not meet the written description requirement of 35 U.S.C. § 112. Because the Federal Circuit determined Bayer’s claim construction to be overly broad and unsupported by the specification, the Appeals Court affirmed the district court’s summary judgment of noninfringement. The Federal Circuit also noted that it need not go further than its rejection of Bayer’s claim construction, since Bayer had not timely argued that it can prevail without the adoption of its broad construction, and because an affirmative construction of the claims was not necessary in order to affirm the district court’s judgment. 

http://www.cafc.uscourts.gov/images/stories/opinions-orders/13-1002.Opinion.8-29-2013.1.PDF  

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Litigation Practice and Procedure: Procedure: Generally

Soverain Software LLC v. Newegg Inc., No. 11-1009 (Fed. Cir. (E.D. Tex.) Sept. 4, 2013). Per Curiam Opinion before Newman, Prost, and Reyna.

On a petition for rehearing, the Federal Circuit granted rehearing for the purpose of clarifying the court’s rulings with respect to Claims 34 and 35 of U.S. Patent No. 5,715,314 (“the ’314 patent”). In Soverain Software LLC v. Newegg, Inc., 705 F.3d 1333, 1337 (Fed. Cir. 2013), the court held that Claim 34 was representative of the “shopping cart” claims being litigated. Soverain Software LLC (“Soverain”) and Newegg, Inc. (“Newegg”) requested rehearing because the district court’s judgment referred to Claim 35 instead of Claim 34. The Federal Circuit granted rehearing and amended its judgment to indicate that Claim 34 is representative of claims including dependent Claim 35, and that Claim 35 is invalid for obviousness.

Claim 34 of the ’314 patent is directed to a network-based sales system that includes at least one buyer computer, at least one shopping cart computer, and a shopping cart database connected to the shopping cart computer. Further, Claim 34 requires that the buyer computer be connected to the shopping cart computer and that the buyer computer be programmed to receive requests from a user to add products to a shopping cart in a shopping cart database and send a plurality of messages to the shopping cart computer corresponding to the selected products. The shopping cart computer is configured to cause a payment message associated with the shopping cart to be created, and the buyer computer is configured to cause the payment message to be activated to initiate a payment transaction. Claim 35 further requires the shopping cart computer to cause the payment message to be created before the buyer computer causes the payment message to be activated.

During trial, the district court directed its obviousness analysis to the limitations in Claim 34. The district court also focused on infringement with respect to Claim 34, and did not discuss any limitations of Claim 35 with respect to obviousness or infringement. On appeal, the parties both focused their arguments on Claim 34. Claim 35 was not briefed on appeal, and the parties presented oral arguments directed towards Claim 34. On rehearing, Soverain did not provide any evidence in contradiction to Newegg’s expert witness, who had testified in district court that prior art disclosed a payment selection being created by a server before it was displayed. Because the parties provided no additional evidence as to whether a dispute exists on whether the element in Claim 35 is disclosed in the prior art, the Federal Circuit concluded that dependent Claim 35 is invalid on the grounds of obviousness along similar reasoning with respect to Claim 34, and the judgment was amended. 

http://www.cafc.uscourts.gov/images/stories/opinions-orders/11-1009.pdf  

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Character of a Patent: Statutory Subject Matter
Litigation Practice and Procedure: Prior Adjudication: Claim Preclusion (Res Judicata)

Accenture Global Services, GmbH, et al. v. Guidewire Software, Inc., No. 11-1486, (Fed. Cir. (D. Del.) Sept. 5, 2013). Opinion by Lourie, joined by Reyna. Dissenting opinion by Rader.

In affirming the district court’s summary judgment as to the invalidity of U.S. Patent No. 7,013,284 (“the ’284 patent”), the Federal Circuit held that a system claim that offers no meaningful limitations to a related method claim directed toward an abstract idea is invalid under 35 U.S.C. § 101. Further, the Federal Circuit held that implementing an abstract idea without including meaningful limitations does not transform an ineligible claim into a patent-eligible claim.

Accenture Global Services, GmbH and Accenture LLP (collectively “Accenture”) filed suit against Guidewire Software, Inc. (“Guidewire”) in district court for infringement of the ’284 patent. The ’284 patent includes a system claim (independent Claim 1) that is directed toward a system for generating tasks to be performed by an insurance organization, and a related method claim (independent Claim 8) directed towards a method for generating tasks to be performed by an insurance organization. Guidewire asserted that the ’284 patent was invalid under 35 U.S.C. § 101 on the basis that the claims are drawn to ineligible subject matter. After the Supreme Court issued its decision in Bilski v. Kappos, the district court allowed Guidewire to renew a motion for summary judgment and subsequently granted the motion finding the patent invalid under 35 U.S.C. § 101.

On appeal, the Federal Circuit affirmed the invalidity of the ’284 patent because the district court’s judgment that the method claims are invalid was not appealed by Accenture and because the system claims are also invalid. The Appeals Court determined that the system claims include no meaningful limitations over the ineligible method claim, and because the judgment as to the method claims was not appealed, the judgment is final and conclusive. Further, the Federal Circuit determined that the system claims should rise and fall together with the method claims because the system claims merely include minor differences in terminology but essentially require the performance of the same process.

The Federal Circuit also held that when no additional substantive limitations narrow or confine the claims from an abstract idea, the claims are invalid under 35 U.S.C. § 101. The Appeals Court determined that Accenture’s attempts to limit the abstract idea of generating tasks to be completed upon the occurrence of an event to a computer implementation or the insurance industry does not provide additional substantive limitations. Accordingly, the Federal Circuit affirmed the district court’s decision to grant summary judgment of invalidity under 35 U.S.C. § 101.

In a dissenting opinion, Chief Judge Rader stated that the majority incorrectly focuses on the framework proposed by the plurality opinion of the Federal Circuit in CLS Bank Int’l v. Alice Corp. instead of Supreme Court precedent and other precedent from the Federal Circuit. Chief Judge Rader also concluded that Accenture’s failure to appeal the invalidation of the method claims should not bar it from arguing that the elements contained within the method claims, which are also shared by the system claims, are directed toward patent-eligible subject matter. 

http://www.cafc.uscourts.gov/images/stories/opinions-orders/11-1486.Opinion.9-3-2013.1.PDF  

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Litigation Practice and Procedure: Courts: Choice of Law: Matters of Exclusive Federal Circuit Jurisdiction
Litigation Practice and Procedure: Jurisdiction: Subject Matter Jurisdiction

Wawrzynski v. H.J. Heinz Co., et al., No. 12-1624 (Fed. Cir. (W.D. Pa.) Sept. 6, 2013). Opinion by Plager, joined by Newman and Prost.

The Federal Circuit determined that it lacked jurisdiction over the merits of the appeal and therefore transferred the case to the United States Court of Appeals for the Third Circuit. Specifically, the Federal Circuit held that it lacked subject matter jurisdiction over state law claims alleged in the complaint because the complaint was not a well-pleaded complaint for patent infringement.

Mr. Wawrzynski is the owner of U.S. Patent No. 5,676,990 (“the ’990 patent”), which is directed towards a method for dipping and wiping a food article, such as a French fry, with a condiment, such as ketchup, in a specially designed condiment package. The food article exits the package such that excess condiment is wiped away from the food article. In March 2008, Mr. Wawrzynski sent H.J. Heinz Company (“Heinz”) a letter soliciting a meeting to present his packaging ideas. In April 2008, Mr. Wawrzynski met with representatives from Heinz, who asserted that they had been developing a new ketchup packaging. During this meeting, Mr. Wawrzynski alleges he disclosed to Heinz the idea of a dual purpose condiment package that allows a user to dip a food article into the condiment or squeeze the condiment out of the package. After the April 2008 meeting, Mr. Wawrzynski continued to send Heinz additional promotional material, but Heinz responded it was no longer interested in receiving additional material. Later, Heinz released a new condiment package that allowed for a user to pull a tab to reveal the condiment for dipping or to rip a portion of the packet to allow the condiment to be squeezed.

On October 5, 2010, Mr. Wawrzynski filed a lawsuit against Heinz in Michigan state court asserting claims relating to Heinz’s new condiment package. Heinz removed the action to the U.S. District Court for the Eastern District of Michigan on the basis of diversity jurisdiction. There, Mr. Wawrzynski filed an amended complaint including allegations of breach of implied contract and unjust enrichment. The amended complaint generally referenced the ’990 patent in the allegations. Heinz then filed a motion to transfer the case to the U.S. District Court for the Western District of Pennsylvania, and there, Heinz filed an answer, affirmative defenses, and a counterclaim that alleged Heinz did not infringe the ’990 patent and that the ’990 patent was invalid. Mr. Wawrzynski eventually filed an answer to Heinz’s counterclaim that stated he was not suing Heinz for infringement of the ’990 patent, and he also provided Heinz with a covenant not to sue Heinz on the basis of the ’990 patent. Heinz filed a motion for summary judgment arguing that federal patent law preempted Mr. Wawrzynski’s claims, which the district court granted. Mr. Wawrzynski now appeals the district court’s ruling.

The Federal Circuit held that whether a claim for patent infringement exists determines whether the Federal Circuit has subject matter jurisdiction over the appeal. Although both parties argued that the Federal Circuit had jurisdiction, the Appeals Court determined that both parties’ arguments were incorrect, and that it lacked jurisdiction.

Mr. Wawrzynski argued the Federal Circuit had jurisdiction under § 1295 of the America Invents Act (“AIA”) because that section gives the Federal Circuit jurisdiction over appeals from a civil action in which a party has asserted a compulsory counterclaim arising under any Act of Congress relating to patents. He argued that Heinz’s counterclaim of noninfringement met this requirement. The Federal Circuit disagreed and held that the AIA version of § 1295 is inapplicable because Mr. Wawrzynski’s suit was commenced upon a filing of a complaint prior to the effective date of the statute.

Heinz argued that the Federal Circuit had jurisdiction under the pre-AIA version of § 1295 because that section provided that the Federal Circuit shall have exclusive jurisdiction of an appeal from a final decision of a district court if the jurisdiction of that court was based, in whole or in part, on section 1338 of Title 38. The Federal Circuit concluded that Mr. Wawrzynski’s complaint aligned with state law claims and did not constitute a well-pleaded complaint for patent infringement. Thus, the Federal Circuit held that it lacked subject matter jurisdiction under this provision.

Accordingly, the Federal Circuit transferred the case to the U.S. Court of Appeals for the Third Circuit. 

http://www.cafc.uscourts.gov/images/stories/opinions-orders/12-1624.Opinion.9-3-2013.1.PDF  

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