CAFC Affirms ITC’s Invalidation of Sweetener Patent Under On-Sale Bar, Citing Helsinn

On August 12, the U.S. Court of Appeals for the Federal Circuit (CAFC) issued a precedential decision in Celanese International Corp. v. International Trade Commission (ITC) affirming the ITC’s ruling that process patents owned by Celanese were invalid due to secret sales of products made by the claimed process prior to the one-year on-sale bar, codified at 35 U.S.C. § 102(a). Following the U.S. Supreme Court’s reasoning in Helsinn Healthcare v. Teva Pharmaceuticals (2019), the Federal Circuit rejected Celanese’s contentions that statutory changes wrought by the America Invents Act (AIA) altered the on-sale bar such that sales of products manufactured by an undisclosed process would not invalidate patents claiming that process.

Helsinn Found That Congress Reenacted On-Sale Bar Under Pre-AIA Interpretation

The present appeal arises from a Section 337 investigation at the ITC petitioned by Celanese concerning high-potency sweeteners sold by Chinese chemical manufacturer, Anhui Jinhe, which allegedly infringed claims of three Celanese patents covering processes for making artificial sweeteners. During that proceeding, it was undisputed that, more than one year prior to the patents’ effective filing date, Celanese’s process was in secret use in Europe resulting in sales of Ace-K sweetener into the United States. The ITC proceeding ended with a determination of no Section 337 violation after the presiding administrative law judge rejected Celanese’s arguments that the AIA’s passage changed the meaning of Section 102(a)(1)’s on-sale bar.

The Federal Circuit’s ruling noted that the on-sale bar has been a part of U.S. patent law since passage of the Patent Act of 1836, and that the bar has long been interpreted as barring patentability based on sales of products made by a secret process. The appellate court noted that the factual record of this appeal was strikingly similar to D.L. Auld v. Chroma Graphics (1983). In that case, the Federal Circuit invalidated patent claims to a process for making cast decorative emblems because the inventor attempted to commercially exploit the process by selling emblems more than one year prior to filing for patent rights.

This interpretation of Section 102(a)(1)’s on-sale bar was not impacted by statutory changes enacted by the AIA under the Supreme Court’s reasoning in Helsinn. In that case, the Supreme Court noted that Congress re-enacted the on-sale bar within the context of a substantial body of law finding the on-sale bar triggered by sales that do not disclose details of the invention to the public. That settled judicial interpretation made it appropriate to presume that Congress’ decision to reenact the “on sale” language in the AIA retained its meaning.

‘Claimed Invention’ is Clerical Refinement Having the Same Meaning as ‘Invention’

On appeal, Celanese made several arguments regarding changes to statutory language enacted by the AIA, including two changes to the language of Section 102(a). By changing “invention” to “claimed invention,” Celanese argued that the process to make its artificial sweetener must itself have been sold to invalidate its process patent claims. Further, the addition of the catch-all phrase “otherwise available to the public” meant that details of the claimed process invention must be public to result in invalidation, according to Celanese.

Rejecting these arguments, the Federal Circuit found that the statutory change to “claimed invention” was simply a clerical refinement reflecting the same meaning, noting that case law interpreting the on-sale bar has interchangeably referred to either the “invention” or the “claimed invention.” As well, the same argument regarding Section 102(a)(1)’s catch-all phrase was at issue in Helsinn, the appellate court noted, and the Supreme Court found that the addition of this new phrase was meant to capture material that didn’t fit enumerated categories like “on sale.”

Celanese similarly lost out on several other arguments regarding the AIA’s changes to other parts of the patent statute. The patent owner argued that the one-year grace period for public disclosures found at Section 102(b)(1) creates a mismatch with the on-sale bar, as no grace period would apply to sales that don’t disclose the claimed invention. However, this case did not implicate Section 102(b)(1)’s grace period as Celanese’s sales occurred outside of the one-year window.

The AIA’s textual changes to infringement statutes codified at 35 U.S.C. § 271(g) and 35 U.S.C. § 273(a) also did not alter the meaning of the on-sale bar, the Federal Circuit held. The appellate court noted that both of these provisions concern infringement and third-party actions, which are distinct issues that don’t concern patentability. Finally, Celanese advanced an argument from the AIA’s legislative history, asserting a statement from AIA co-sponsor Senator Patrick Leahy (D-VT) that the newly drafted Section 102(a)(1) meant to do away with invalidations through secret sales. Noting that Helsinn relied on the same statement at the Supreme Court, the Federal Circuit added that the views of individual legislators do not establish congressional intent.

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