Federal Circuit Clarifies Precedent on Pre-AIA Prior Art ‘By Another’

The U.S. Court of Appeals for the Federal Circuit (CAFC) issued a precedential decision on Thursday, in part clarifying its precedent on the interpretation of “by others” or “by another” under pre-America Invents Act (AIA) 35 U.S.C. §§ 102(a), (e). The opinion was authored by Judge Linn.

Merck Serono appealed two decisions of the Patent Trial and Appeal Board (PTAB) holding claims of Merck’s U.S. Patent Nos. 7,713,947 and 8,377,903 unpatentable in inter partes review (IPR) proceedings brought by Hopewell Pharma Ventures. The Board found the claims unpatentable as obvious over a combination of two prior art references, “Bodor” and “Stelmasiak”.

The patents are both titled “Cladribine Regimen for Treating Multiple Sclerosis” and were invented jointly by four named inventors: Drs. De Luca, Ythier, Munafo, and Lopez-Bresnahan. While Merck argued that the Bodor reference was not prior art because inventor De Luca “provided an inventive contribution to the 6-line regimen that appears in Bodor,” the Board determined that Merck had failed to produce credible evidence proving as much.

Minutes of an August 2003 meeting held by Serono S.A., which was acquired by Merck, noted participation by three of the four named inventors on the patents-in-suit: Drs. Lopez-Bresnahan, Ythier, and Munafo, as well as members of a team at IVAX Corporation, which Serono partnered with, including Dr. Dandiker, one of the authors of the Bodor reference. Drs. Bodor and Dandiker ultimately filed the Bodor international application, which was published on October 14, 2004.

The parent applications to the patents at issue in the appeal were filed in December 2004 and issued in 2010 and 2013. Hopewell Pharma subsequently petitioned the PTAB for IPR of both patents, arguing they were obvious over Bodor and Stelmasiak. The Board agreed, in part ruling that Bodor was prior art because “there is no facial overlap in the named inventors or assignees of Bodor and the ’947 patent.”

The Board shifted the burden of production to Merck to come forward with evidence to support its argument that Bodor should not be prior art, but ultimately held it did not meet that burden, having failed to “produce[] documents and testimony [showing] credible and corroborated evidence that inventor De Luca, named on the ’947 patent, provided an inventive contribution to the 6-line regimen that appears in Bodor.”

Merck in part had argued that “a reference’s disclosure of the invention of a subset of inventors is disqualified as prior art against the invention of all the inventors,” but the Board rejected that argument. Furthermore, the PTAB said that even if Merck had proven an inventive contribution, since Bodor and Dandiker, who are not named inventors on the patents, are “at least co-inventors of all applied portions” of Bodor, the reference is still “by another” and qualifies as prior art.

The CAFC took the opportunity to clarify its reasoning with respect to when a prior art reference is considered “by another” under the statute. “While the meaning of the statutory phrase ‘by another’ is apparent when only a single inventor is involved, its meaning becomes less clear when the invention of joint inventors is at issue,” explained the court.

Merck relied on an excerpt from the CAFC’s decision in Applied Materials, Inc. v. Gemini Res. Corp., 835 F.2d 279 (Fed. Cir. 1987) to argue that “a disclosure invented by fewer than all the named inventors of a patent…should properly be treated as ‘one’s own work’ and therefore excluded from the prior art.” In Applied Materials, the court said that “the fact that an application has named a different inventive entity than a patent does not necessarily make that patent prior art.”

Hopewell, on the other hand, relying on a 60-year old case, In re Land, 368 F.2d 866, 877 (CCPA 1966), argued that “a prior disclosure is only excluded from the prior art as the work of the patentee when there is complete identity of inventive entity between the inventors of the disclosure being relied upon and the challenged patent.”

The court ultimately agreed with Hopewell. Although it acknowledged a “weakness in the reasoning” of the Land court, it detailed more recent case law that supports Hopewell’s view and said it could not accept Merck’s arguments. The court explained:

“Our case law—in particular, Land—precludes our adoption of the policy argument presented by Merck. As those cases make clear, for a reference not to be ‘by another,’ and thus unavailable as prior art under pre-AIA § 102(e), the disclosure in the reference must reflect the work of the inventor of the patent in question. That is clear enough when a single inventor is involved. What should also be clear is that when the patented invention is the result of the work of joint inventors, the portions of the reference disclosure relied upon must reflect the collective work of the same inventive entity identified in the patent to be excluded as prior art. That showing may be made by fewer than all the inventors but nonetheless must evince the joint work of them all to avoid being considered a work ‘by another’ under the statute. Any incongruity in the inventive entity between the inventors of a prior reference and the inventors of a patent claim renders the prior disclosure ‘by another,’ regardless of whether inventors are subtracted from or added to the patent.”

The CAFC went on to reject Merck’s additional arguments that the court’s rule is “contrary to several provisions of the Manual of Patent Examining Procedure (‘MPEP’), and that the Board erred by not giving Merck an opportunity to submit arguments and rebuttal evidence, as required by the Administrative Procedure Act (‘APA’).” The opinion pointed to a prior statement in which it noted “[t]o the extent the MPEP describes our case law differently, that interpretation does not control” and also pointed to clarifying language in the MPEP with respect to the situation at hand. Since Land controls the legal definition of “by others” or “by another,” contrary language in the MPEP is not enough to claim a lack of knowledge of the rule. And since the MPEP does explain the application of the rule in this circumstance, Merck had sufficient notice.

Finally, with respect to Merck’s argument that the Board erred in not finding De Luca to be a contributing inventor and requiring that Merck show a “specific contribution made by DeLuca,” the CAFC said the Board’s request was within the “rule of reason” and that “there is no doubt” that the Board considered all the evidence in making its evaluation. The court further rejected Merck’s argument that the Board erroneously shifted the burden of persuasion to Merck, remarking that “the Board expressly shifted only the burden of production to Merck.”

The court then went on to rule that substantial evidence supported the PTAB’s obviousness analysis and that all claims at issue were therefore unpatentable as  obvious.