Incept LLC v. Palette Life Sciences, Inc., Nos. 2021-2063, -2065 (Fed. Cir. (PTAB) Aug. 16, 2023). Opinion by Schall, joined by Taranto. Opinion concurring in part and dissenting in part by Newman.
Incept owns two patents related to improved methods for treating cancer by radiation. Palette filed IPR petitions asserting that the claims are unpatentable as anticipated by, or obvious in view of, the prior art, including the “Wallace” patent. The Patent Trial and Appeal Board issued final written decisions finding the claims unpatentable on the Wallace-based grounds. Incept appealed.
The Federal Circuit affirmed. Regarding anticipation, Incept argued that the Board committed legal error by engaging in a “patchwork approach” that involved “picking and choosing” from Wallace’s different teachings. The Federal Circuit disagreed, ruling that “Incept cannot use the fact that Wallace describes multiple compositions to evade an anticipation finding where Wallace provides ‘as complete detail as is contained in the patent claim,’ such that a skilled artisan would have understood that Wallace’s compositions had the same generic properties as those in [Incept’s] patent claims.” Overall, the Federal Circuit saw no legal error in the Board’s anticipation analysis, and the court ruled that substantial evidence supported the Board’s findings.
Regarding obviousness, Incept raised four arguments on appeal. First, Incept argued that the Board’s obviousness analysis “was based entirely on its flawed anticipation analysis.” The Federal Circuit disagreed. For instance, the Board had “made findings of motivation to combine that are not merely conclusory,” and substantial evidence supported the Board’s findings.
Second, Incept argued that the Board ignored Wallace’s teaching away from “biodegradable” compositions, as required by certain claims. Incept emphasized Wallace’s disclosure of polymers that, according to Wallace, are “essentially nondegradable in vivo over a period of at least several months.” The Federal Circuit ruled, however, that Wallace did not teach away because it expressly disclosed that the “polymers may include biodegradable segments and blocks,” including segments “that degrade so as to break covalent bonds.”
Third, Incept complained that the Board did not separately analyze certain dependent claims. The Federal Circuit saw no issue, as Palette had identified the pertinent disclosures in the prior art, and Incept did not separately argue the patentability of those claims before the Board. The Federal Circuit ruled: “Where a party does not raise any arguments with respect to any other claim limitation, nor does it separately argue the dependent claim, the dependent claim stands or falls together with the independent claim.”
Finally, Incept argued that the Board imposed an overly stringent standard for showing commercial success, which Incept had relied on as evidence of nonobviousness. The Federal Circuit saw no reversible error in the Board’s determination, “whether viewed as a factual one about the level of success or a legal one about the weight of any such success in the overall obviousness analysis.”
Judge Newman dissented in part, raising concerns with the majority’s treatment of both anticipation and obviousness. First, Judge Newman disagreed with the majority’s ruling that Wallace anticipated the dependent claims. According to Judge Newman, the majority invalidated the dependent claims “without analysis of these claims’ additional limitations in view of the prior art.” For example, Judge Newman took issue with the majority’s conclusion that Wallace anticipates the biodegradability of the patented polymers, as “Wallace states that its compositions are ‘not readily degradable.’” Second, Judge Newman dissented from the majority’s handling of Incept’s commercial success evidence. Based on these two concerns, Judge Newman would remand to allow the Board to address anticipation of the dependent claims, and “to apply the evidence of commercial activity and market growth to the determination of obviousness.”