CAFC Vacates Insecticide Injunction Due to Erroneous Claim Construction

On Friday, August 1, the U.S. Court of Appeals for the Federal Circuit (CAFC) issued a precedential ruling in FMC Corp. v. Sharda USA, LLC vacating the Eastern District of Pennsylvania’s preliminary injunction order preventing Sharda from importing, selling or distributing its “WINNER” insecticide. The Federal Circuit found that the district court’s grant of injunctive relief rested on an erroneous claim construction for “composition” that failed to take into account the removal of references to stable compositions from the specification of the asserted patents.

Material Alterations to Specification Broadened Meaning of Challenged Claim Term

FMC Corp. accused Sharda’s insecticide of infringing claims from two asserted patents: U.S. Patent No. 9107416 and U.S. Patent No. 9596857, both titled Insecticidal and Miticidal Mixtures of Bifenthrin and Cyano-Pyrethroids and claiming novel compositions exhibiting unexpected insecticidal properties. The district court construed “compositions” as limited to stable compositions rather than unstable compositions producing ineffective results, relying on statements from the specification of the provisional parent application to both the ‘416 and ‘857 patents as well as another patent from the same family, U.S. Patent No. 8153145. The district court also rejected invalidity arguments raised by Sharda because the asserted prior art disclosed unstable compositions, falling outside of the court’s construction of “compositions” in this case.

On appeal, however, the Federal Circuit agreed with Sharda’s arguments that the district court impermissibly grafted a stability requirement onto the “compositions” limitation. Although the parent application included various teachings on stability and stable compositions, the CAFC noted that FMC chose to alter the written specification of the asserted patents by removing every reference to stability from the parent application before it matured into the asserted patents. Similarly, the ‘145 patent maintained disclosures of stable compounds that were removed from the asserted patents prior to issue.

This evolution in the written description of both the ‘416 and ‘857 patents is one that a skilled artisan would have found meaningful, the Federal Circuit ruled. The appellate court analogized this case to DDR Holdings v. Priceline.com (2024), in which the Federal Circuit found that the deletion of “services” from the specification of a patent indicated that the term “merchant,” which was defined by the patent’s provisional application as “producers, manufacturers, and select distributors of products and services,” had evolved and should be held to the asserted patent’s definition as “producers… of the goods.” While FMC argued that DDR Holdings was limited to situations where such a deletion narrowed a claim term, the Federal Circuit found that its reasoning in that case instead turned on the existence of meaningful alterations made between the provisional application and the patent-at-issue.

The Federal Circuit found many of the same issues with the district court’s reliance on the ‘145 patent. While cases such as SightSound Technologies v. Apple (2015) established that claim terms are to be interpreted consistently across a patent family deriving from the same parent application, this principle does not hold true when a patent owner materially alters the specification of some members of the patent family.

Erroneous Claim Construction Infected Anticipation, Obviousness Analyses

Prosecution history cut against FMC’s further contentions that references to “homogenous” compositions and “unexpected insecticidal activity” from the patents’ common specification mandated a stability requirement. While the parent provisional application expressly mentions “homogenous” and physical “phase separation,” those references occur in different sections without suggestion of any relation between the phrases. As well, the Federal Circuit found that insecticidal activity was a distinct characteristic of the claimed compositions and not an indicator of the composition’s stability.

“With the correct claim construction in mind,” the Federal Circuit found error in the district court’s anticipation and obviousness analysis. The district court’s ruling on either ground of validity relied heavily upon the finding that a 1996 scientific article (“McKenzie”) proffered as prior art by Sharda only disclosed unstable compounds. Noting that anticipating embodiments need not be preferred embodiments, a premise stemming from the Federal Circuit’s 2005 ruling in Arthrocare Corp. v. Smith & Nephew, the appellate court found error in the district court faulting Sharda for focusing on less effective embodiments disclosed by McKenzie. Although preambles of several asserted claims recite “miticidal” properties of the claimed compositions that were undisclosed by McKenzie, such language merely stated the invention’s purpose and was not a limiting preamble, the Federal Circuit held.

On obviousness, FMC argued that the district court’s finding rested on the unexpected superior performance of the claimed compositions instead of their stability. The Federal Circuit disagreed, highlighting the district court’s discussion of the purported instability of the compositions disclosed in McKenzie and its finding that Sharda’s obviousness arguments “fail for similar reasons as the anticipation argument.” Although the district court considered unexpected success as a secondary consideration of nonobviousness, its prima facie analysis of obviousness was infected by its erroneous claim construction.

Vacating the ruling on these grounds, the Federal Circuit declined to reach Sharda’s argument that FMC’s patent claims were invalid for lacking adequate written description. On remand, the Eastern Pennsylvania district court should give “compositions” its plain and ordinary meaning. Further, the Federal Circuit ordered the lower court to identify each distinct obviousness theory raised by Sharda and determine whether Sharda has raised a substantial question of obviousness based on its prima facie case in light of rebuttal evidence of unexpected results.

Image Source: Deposit Photos
Image ID: 213063766
Author: Devon