Federal Circuit Finds Print Advertisement Contains an Enabling Disclosure Sufficient to Invalidate Claims Under 35 U.S.C. §102(b)

In Iovate Health Sciences, Inc. vs. Bio-Engineered Supplements & Nutrition, Inc., 92 USPQ2d 1672 (Fed. Cir. 2009), Iovate is the exclusive licensee of U.S. Patent No. 6,100,287 (the ‘287 patent).  The ‘287 patent is assigned to the University of Florida Research Foundation, Inc.  The ‘287 patent was filed on Nov. 13, 1998 and claims priority from a provisional application filed on Nov. 13, 1997.  The invention is directed to using nutritional supplements containing a ketoacid and either a cationic amino acid or a dibasic amino acid to improve muscle performance or recovery from fatigue.

Claims 2, 5, 7 and 8 of the ‘287 patent disclose various features defining the composition recited in claim 1, which recites “A method for enhancing muscle performance or recovery from fatigue wherein said method comprises administering a composition comprising a ketoacid and an amino acid wherein said amino acid is cationic or dibasic.”  Additionally, claim 9 recites orally administering the composition, and claim 18 recites using the composition on humans. 

Iovate sued BSN for the infringement of the ‘287 patent in March 2007 in the Eastern District of Texas.  The allegedly infringing products contain arginine alpha keto-glutarate and are advertised as enhancing muscle strength or resistance to muscle fatigue.  With respect to the recitations of claim 1 of the ‘287 patent, the District Court interpreted “enhancing muscle performance” to mean “increasing the ability of muscle to maintain required or expected force or power output,” and interpreted “recovery from fatigue” to mean “increasing muscle performance after muscle performance has been decreased by exercise.” BSN moved for summary judgment, asserting that the ‘287 patent was invalid because it was anticipated or rendered obvious by numerous amino acid and ketoacid nutritional supplements advertised in fitness periodicals.

The District Court granted BSN’s motion for summary judgment and found claims 1, 2, 5, 7, 8, 9 and 18 to be invalid under 35 U.S.C. §102(b) because they were anticipated by ads for TwinLab Mass Fuel and Weider’s VICTORY Professional Protein, as published in Flex magazine before the critical date of Nov. 13, 1996.  The ads each included a list of respective ingredients and directions on how to orally administer the supplements to a human.  Additionally, the ads described the supplements as generally accelerating muscle recovery, helping to increase muscle growth and helping muscles recuperate after exercise.  The Professional Protein ad listed a price for the supplement and stated that the product was available at health food or nutritional stores.  As such, the District Court held that the ads established public use and an offer for sale of the product under 35 U.S.C. §102(b).  Furthermore, the District Court held that the ads disclosed all the limitations of the claims at issue and that the ads were enabling because a person of skill in the art would consider the disclosures in the ads in combination with the person of skill’s knowledge to be enabled.  Continue reading

Federal Circuit Finds Clinical Trials Are Not Public Use Where the Drug Was Not Ready for Patenting at the Time of Use

In In Re Omeprazole Patent Litigation, 536 F.3d 1361 (Fed. Cir. 2008), Astrazenca AB, et al. (Astra) owns U.S. Patent No. 4,786,505 (‘505 patent) and U.S. Patent No. 4,853,230 (‘230 Patent).  The ’505 patent and the ’230 patent are directed to omeprazole.  Omeprazole is the active ingredient of Prilosec® and is intended to treat gastrointestinal disorders by inhibiting secretion of gastric acid.  Omeprazole degrades in acid-reacting and neutral media and is also unstable when exposed to moisture and organic solvents.  To overcome the issues facing omeprazole, an enteric coating can be used to cover the drug core to protect omeprazole from gastric acid.  However, enteric coatings contain acidic compounds that will degrade the drug while in storage.  To increase drug stability in storage, the ’505 and ’230 Patents add an Alkaline Reacting Compound (“ARC”) to the drug core.

Impax, on Dec. 31, 1999, sought Food & Drug Administration (FDA) approval to sell 10 and 20 mg generic versions of Prilosec®.  Astra filed an infringement suit for the ‘505 and the ‘230 patent under 35 U.S.C. § 271(e)(2)(A), and filed a second action when Impax amended its application to include a 40 mg version.  The FDA granted final approval to Impax in September 2004 to market 10 and 20 mg versions of generic omeprazole, upon which Astra amended its complaint to include damages under 35 U.S.C. §§ 271(a)-(c).

Impax filed a response to Astra’s complaints and asserted counter-claims including fraud and sham litigation, a declaration of unenforceability to the patents, and noninfringement and invalidity as to the claims of the two patents and it additionally demanded a jury trial.  The District Court held a 42-day bench trial after stipulation by Astra to dismiss demand for damages against Impax.  After the trial, but before the court’s decision was issued, both of the patents expired.  However, Astra held a 6 month market exclusivity grant from the FDA after the expiration of the ‘505 and the ‘230 patents.  The District Court held that Astra’s ‘505 and ‘230 patents were valid and were infringed by Impax.

Impax appealed the decision, arguing that the District Court should not have denied Impax’s demand for a jury trial and should not have denied Impax’s motion to dismiss Astra’s claims as moot.  Impax also challenged the sufficiency of evidence for infringement and that the claims of the patent should be invalid under the public use bar set forth in 35 U.S.C. § 102(b).

On appeal, the Federal Circuit agreed with the District Court that, while the ‘505 and the ‘230 Patents expired on April 20, 2007, the District Court retained the authority to enforce Astra’s right to market exclusivity under 35 U.S.C. § 271(e)(4)(A).  Specifically, the Federal Circuit found that the District Court retained jurisdiction under the court’s general equitable authority.

Impax also challenged the District Court’s finding regarding the public use bar of 35 U.S.C. § 102(b).  The ‘505 and ‘230 patent applications were filed on April 20, 1987, making their one year critical date April 20, 1986.  Before the critical date, Astra had ordered four large clinical studies on the safety and effectiveness of its drugs in order to obtain FDA approval.  Impax argued that these clinical studies were a public use of Astra’s claimed formulation for purposes of 35 U.S.C. § 102(b).  The District Court ruled against Impax’s assertions on two grounds: (1) the studies constituted experimental uses and, therefore, not public uses; and (2) the patented drug was not ready for patenting until after completion of the clinical studies.

On appeal, the Federal Circuit found the District Court to be in error regarding the determination that an experimental use exception serves to negate the public-use bar of 35 U.S.C. § 102(b).  Relying upon Cargill, Inc. v. Canbra Foods, Ltd., 476 F.3d 1359, 1371 n.10 (Fed. Cir. 2007); Allen Eng’g Corp. v. Bartell Indus., Inc., 299 F.3d 1336, 1354 (Fed. Cir. 2002); New Railhead Mfg., LLC v. Vermeer Mfg. Co., 298 F.3d 1290, 1299 (Fed. Cir. 2002); EZ Dock, Inc. v. Schafer Sys., Inc., 276 F.3d 1347, 1357 (Fed. Cir. 2002); Zacharin v. United States, 213 F.3d 1366, 1369 (Fed. Cir. 2000); and Baxter Int’l, Inc. v. COBE Labs, Inc., 88 F.3d 1054, 1060 (Fed. Cir. 1996), the Federal Circuit stated that “it is clear from this court’s case law that experimental use cannot negate a public use when it is shown that the invention was reduced to practice before the experimental use.” As such, merely because a use is deemed a clinical trial does not prevent the clinical trial from being a public use.  Instead, the inquiry centers on whether the use occurred after the invention was ready for patenting.

Even though the District Court misapplied the experimental use exception to public use, the Federal Circuit affirmed the District Court’s decision that the claims were not invalid under 35 U.S.C. § 102(b) as they were not ready for patenting.  Relying upon Invitrogen Corp. v. Boicrest Mfg., L.P., 424 F.3d 1374, 1380 (Fed. Cir. 2005) and Pfaff v. Wells Electronics, Inc., 525 U.S. 52, 67 (1998), there was insufficient evidence that the patented formulation was not ready for patenting until after completion of the clinical studies.  The Federal Circuit noted that, in Pfaff, the Supreme Court detailed two ways to show that an invention was ready for patenting before the critical date for purposes of 35 U.S.C. § 102(b):  (1) proving reduction to practice before the critical date; or (2) proving that the inventor had prepared drawings or descriptions prior to the critical date that were sufficient for a person skilled in the art to practice the invention.

Citing z4 Techs., Inc. v. Microsoft Corp., 507 F.3d 1340, 1352 (Fed. Cir. 2007), the Federal Circuit noted that there needs to be evidence that, in addition to actually building the invention meeting all the claimed limitations, but also evidence that the inventors “determined that the invention would work for its intended purpose.”

In applying the test for actual reduction to practice for purposes of 35 U.S.C. § 102(b), the Federal Circuit rejected Impax’s challenge of the District Court’s finding with the assertion that the use of the formulation used in Phase III trials shows that Astra’s scientists had conceived and produced the formulation.  Specifically, the Federal Circuit stated that “[i]t is not disputed that the Phase III formulation had been produced before clinical trials.  The existence of the formulation, however, does not establish that the Astra scientists had determined that the invention would work for its intended purpose.”  Id at 20.

Impax went on to argue that the Astra scientists knew in 1979, the year of the first patent application, that omeprazole could be safe and effective for treatment purposes.  However, the Federal Circuit found no clear error with the District Court’s finding since “Impax’s argument misses the point…Impax has not demonstrated that, without conducting the Phase III clinical tests, the inventors knew that…it would be effective as a treatment for gastrointestinal disease.”   As such, the Federal Circuit affirmed the District Court’s finding that the claims were valid as there was insufficient evidence that the inventors appreciated that the drug formulation would work for its intended purpose during the clinical trials.

The Federal Circuit also rejected Apotex’s arguments that the ‘505 and ‘230 Patents claims would be anticipated under 35 U.S.C. § 102 and/or obvious under 35 U.S.C. § 103 in light of fifteen other prior art publications.  Specifically, the Federal Circuit found that the primary references applied for anticipation purposes for the ’230 patent, U.S. Patent No. 2,991,226 (“the ’226 patent”), U.S. Patent No. 4,470,980 (“the ’980 patent”), and European Patent Application No. EP 122,815 A1 (“the ’815 European application”), lacked an “acid labile pharmaceutically active substance” as in the claimed invention and affirmed the District Court’s finding that the claims in the ’230 patent were not anticipated by these primary references.

Further, the Federal Circuit affirmed the District Court’s decision that the claimed invention of the ’230 and ’505 Patents was not obvious under 35 U.S.C. § 103 in view of these primary references and various combinations of secondary references.  Specifically, while testimony existed as to references and how one of ordinary skill in the art would have understood the teachings of each, there was sufficient evidence from the testimony that one of ordinary skill in the art would not have combined the references in a manner which read on the claimed invention.  The Federal Circuit also found that two of such were not printed publications since there was insufficient evidence that such publications were available to the public in a manner required for 35 U.S.C. § 102, and thus were not available for purposes of 35 U.S.C. § 103.

In dismissing the challenges brought by Apotex and Impax, the Federal Circuit affirmed the District Court decision that Astra’s patents were enforceable and not invalid and that they were infringed by Apotex and Impax.

Significance to Patent Owners

In Re Omeprazole Patent Litigation demonstrates that the mere designation of a public use as “experimental” does not preclude the use as being invalidating under 35 U.S.C. § 102(b).  The important factor for purposes of 35 U.S.C. § 102(b) is whether the inventors understood that the invention would work for its intended purpose, not the subjective label given to the use.   That being said, In Re Omeprazole Patent Litigation also demonstrates the importance of filing for patent protection before beginning any public demonstration of an invention since such uses will invariably be challenged during litigation as being public, thereby risking the patent becoming invalid as well as charges of inequitable conduct where such uses were not disclosed to the Examiner during prosecution.

Federal Circuit Disallows Experimental Use Exception In Evaluation Sale of Prototypes

In Atlanta Attachment Company v. Leggett & Platt, Inc., 516 F3d 1361, 85 U.S.P.Q.2d 1995 (Fed. Cir. 2008), Atlanta Attachment manufactures commercial sewing machines.  Atlanta Attachment and Sealy, Inc. entered into an agreement under which (1) Atlanta Attachment would develop an automatic gusset ruffler machine for Sealy, (2) if successful, Sealy would patent the machine, (3) if successful, Atlanta Attachment would only sell to Sealy, and (4) Atlanta Attachment would keep the development of the machine confidential.  At trial, both Atlanta Attachment and Sealy stated that both were expected to keep the development of the machine confidential.  Atlanta Attachment provided four prototypes to Sealy in succession, each of the prototypes embodying improvements suggested by Sealy.

Relevant to the issues herein, Atlanta Attachment provided a quotation for the third prototype to Sealy in September of 2000 and sales orders including quotations for sales of the third prototype on November 30, 2000, and February 5, 2001.  Sealy paid the February 5, 2001 invoice.  Sealy inspected the third prototype at Atlanta Attachment’s facilities, but Atlanta Attachment did not control the experimentation on and inspection of the prototype.  Sealy ultimately rejected the fourth prototype, thereby allowing Atlanta Attachment to seek sales elsewhere.

On August 15, 2002, Atlanta Attachment filed U.S. Patent Application No. 10/219,837, which issued as U.S. Patent No. 6,834,603 on December 28, 2004.  The ‘603 Patent claims priority to Provisional Application No. 60/362,025 filed on March 5, 2002.  Therefore, the critical date for analysis of statutory bars under 35 U.S.C. §102(b) is March 5, 2001.

Atlanta Attachment sued Leggett & Platt, alleging Leggett & Platt’s GPT-1000 series sewing machines infringed claim 32 of the ’603 patent.  Leggett & Platt asserted that the ’603 patent was invalid due to an on‑sale bar due to the pre-March 2002 activities of Atlanta Attachment in attempting to sell prototypes to Sealy.  The Northern District of Georgia found summarily that Leggett & Platt infringed claim 32 of the ‘603 Patent, that the ‘603 patent was not invalid because of the on-sale bar, obviousness, lack of best mode and written description, and not unenforceable due to inequitable conduct.

On appeal, the Federal Circuit reversed the District Court on the issue of the on-sale bar.  Specifically, the Federal Circuit held that claim 32 of the ‘603 Patent was on-sale within the meaning of 35 U.S.C. §102(b) before the critical date thereof.   Under 35 U.S.C. §102(b), “a person shall be entitled to a patent unless … (b) the invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States.”

An invention is statutorily barred from patenting if it was both (1) the subject of a commercial offer for sale before the critical date and (2) ready for patenting at the time of the offer.  Slip at 5, citing Pfaff v. Wells Elecs, Inc., 525 U.S. 55, 67, 199 S.Ct. 304, 311-12 (1998).  Such inventions are barred from patenting so as to prevent an inventor from commercially exploiting the invention beyond the statutory term for patent.  Id., citing Netscape Commc’ns. Corp. v. Konrad. 295 F.3d 1315, 1323 (Fed. Cir. 2002).  The third prototype is analyzed for purposes of the on-sale bar as the third prototype embodies the asserted claim 32. Further, the Federal Circuit held that the experimental use exception to the statutory bars of 35 U.S.C. §102(b) does not apply after a commercial offer for sale of an embodiment of an asserted claim.  “[O]nce there has been a commercial offer, there can be no experimental use exception.”  Slip at 8.

(1) Commercial Offer for Sale

In order to be a commercial offer for sale, such offer must be sufficiently definite that another party could make a binding contract by simple acceptance, assuming consideration, according to principles of general contract law.  Id. at 6.  The Federal Circuit stated that a distinction between experimental use and commercial exploitation of an invention has been long recognized.  As such, the Court must consider “whether the primary purpose of the offers and sales was to conduct experimentation.”  Id., citing Allen Eng’g Corp. v. Bartell Indus., 299 F.3d 1336, 1354 (Fed. Cir. 2002).  After considering the factors, the Federal Circuit found that claim 32 of Atlanta Attachment’s U.S. Patent No. 6,834,603 is not enforceable because an embodiment of claim 32 was on sale before the critical date (i.e., on sale more than one year before the earliest date to which the application that became the ‘603 patent claims benefit or priority), and was not eligible for the experimental use exception.

The Court found that the invention was subject to a commercial offer for sale.  Atlanta Attachment presented an invoice for the third prototype on February 5, 2001 (an offer), which Sealy paid (an acceptance).  Thus, there was evidence of contract for a commercial sale of the third prototype.

While Atlanta Attachment contended that this sale was really for experimental use and was therefore not a 35 U.S.C. §102(b) bar, the Federal Circuit disagreed since the sales were specifically not experimental use.  In so finding, the Court stated that experimentation to determine whether an invention meets a particular customer’s purposes does not fit within the experimental use exception.  Id., citing Allen Eng’g and In re Thesis, 610 F.2d 782, 792, 63 USPQ2d 1769 (CCPA 1979).  Further, the Court emphasized that the experimental use exception only applies to the actions of Atlanta Attachment and their agents.   In deciding whether experimental use exception is applicable, the Court noted that a number of factors can be used for assessing whether the circumstances surrounding a transaction indicate whether such transaction was commercial or experimental.  The court specifically noted that Allen Eng’g, 63 USPQ2d at 1779 catalogs these factors, but that a major factor is an amount of control over the experiment retained by the inventor.   

In applying these factors, the Federal Circuit found that Atlanta Attachment’s lack of control over the experimentation performed by Sealy in February 2001 was dispositive to show that Atlanta Attachment was not experimenting within the experimental use exception.  Specifically, the experimentation with respect to the third prototype was conducted by Sealy, and was not under the control of Atlanta Attachment during the testing as would be required for Atlanta Attachment to show experimental use.  As such, there was insufficient evidence of control to allow Atlanta Attachment to avoid the on-sale bar due to the sale of the third prototype.

Lastly, the Court found that Atlanta Attachment’s quotation to Sealy dated September 27, 2000 for sale of 50 units, which Atlanta Attachment testified would become a contract with upon Sealy’s signature, constituted a commercial offer for sale that cannot be avoided by the experimental use exception.

As such, Atlanta Attachment’s actions constitute a commercial offer for sale before the critical date of March 5, 2001, and therefore satisfied the first prong of the Pfaff v. Wells test.

(2) Ready for Patenting

The Federal Circuit next concentrated on whether the commercial offer was contemporaneous with the invention being ready for patenting.  The Federal Circuit found that the invention of claim 32 was ready for patenting at the time of the commercial offer because the third prototype was an embodiment of claim 32.  That the invention was ready for patenting may be demonstrated by (i) proof of reduction to practice before the critical date, or (ii) proof that “the inventor had produced drawings or descriptions of the invention that were sufficiently specific to enable a person skilled in the art to practice the invention” before the critical date.  Slip at 8, quoting Pfaff, 525 U.S. at 67-68.  “An invention is reduced to practice when it works for its intended purpose” such that “there is a demonstration of its workability or utility.”  Id., internal citations omitted.  The Court found that the invention as recited in claim 32 was reduced to practice in February 2001 in Atlanta Attachment’s presentation of the third prototype to Sealy as the third prototype demonstrated the workability and utility of claim 32, and therefore, the invention of claim 32 was ready for patenting before the critical date.

Atlanta Attachment argued that the invention was not ready for patenting because Atlanta Attachment further refined the invention in response to Sealy’s comments.  “Consistent with the rule that later refinements do not preclude reduction to practice, it is improper to conclude that an invention is not reduced to practice merely because further testing is being conducted.”  Id. at 9.

In support of its showing that the testing evidenced a lack of workability, Atlanta Attachment further argued that the invention was not ready for patenting because the third prototype vibrated at high speeds, which was corrected in the fourth prototype.  However, because vibration-free operation was not claimed in claim 32, such refinement of the experimentation is only relevant if the vibration prevented workability or utility of the invention, and no evidence was presented to show that the vibration prevented workability or utility of the invention.

Lastly, Atlanta Attachment argued that in the third prototype, the pleat generator was coupled to the sewing head, thereby limiting the third prototype to one ruffle and one stitch at a time.  However, the Court noted that claim 32 does not require an uncoupled pleat generator or multiple stitches per pleat.  “While improvements were possible and ultimately manufactured in the fourth prototype, these deficiencies in the third prototype did not prevent reduction to practice of the invention actually claimed.”  Id. at 10.  Therefore, the prototype, while not perfect, was sufficiently workable to read on the invention as claimed in claim 32.

Conclusion

As the Court determined that the invention of claim 32 was the subject of a commercial offer for sale and ready for patenting before the critical date, March 5, 2001, the Court held claim 32 invalid due to the on-sale bar of 35 U.S.C. 102(b).  The Court remanded the case to the District Court for reconsideration of the allegations of inequitable conduct because the third prototype was material to the examination, but materiality does not presume intent.

 Significance for Entrepreneurs

Atlanta Attachment provides another example of the difficulty of executing agreements to allow customers to experiment with prototypes without triggering an on sale bar.  As demonstrated, where the prototype is workable and is being provided for purposes of consideration, courts are likely to find such a transaction a sale for purposes of 35 U.S.C. §102(b).  As such, it is important for inventors to ensure that they have already filed some form of patent application in order to ensure that such a transaction does not present a subsequent on-sale bar.

Federal Circuit Finds Testing of Prototype And Publication About Test Are Experimental And Not Public Use or On Sale Bars under 35 U.S.C. §102(b)

In its opinion in Honeywell Int’l Inc. v. Universal Avionics Sys. Corp., 488 F.3d 982 ;82 U.S.P.Q.2d 1886 (Fed Cir. 2007), the United States Court of Appeals for the Federal Circuit affirmed in part, vacated in part, and remanded the Delaware District Court’s decision invalidating certain claims and finding no infringement of Honeywell patents involving aviation electronic and terrain warning systems. 

Background

In the field of terrain warning technology for aviation, known “ground proximity warning systems” (GPWSs) have significantly reduced accidents resulting from planes flying into terrain since the 1970’s.  GPWSs use radio waves to measure the distance from the plane to the ground, which worked well for gradual changes in terrain.  However, GPWSs do not provide information regarding the terrain in front of a plane.  As a result, Honeywell began research in the 1980 to develop a “look ahead” terrain warning system.  Honeywell came up with a virtual system, which compared the plane’s position with a map of the earth terrain.   In 1995, Honeywell received U.S. Patent Nos. 5,839,080 (the ’080 patent), 6,092,009 (the ’009 patent), 6,122,570 (the ’570 patent), 6,138,060 (the ’060 patent), and 6,219,592 (the ’592 patent).  

The accident that claimed the life of Ron Brown, Commerce Secretary, led to the FAA requiring that all commercial aircraft be equipped with a look ahead warning system.  Consequently, Universal and Sandel began developing such systems.  Honeywell then brought suit against both Universal and Sandel alleging infringement of the Honeywell patents.  The district court granted the defendant’s summary judgment motions of invalidity of claims withdrawn from litigation and of non-infringement; however, the court denied all of the defendant’s remaining counterclaims. 

The Federal Circuit addressed several issues during appeal.  After determining that material issues remained as to whether there was infringement such that the summary judgment was inappropriate, the Federal Circuit went on to review whether the claims were invalid under 35 U.S.C. § 102(b) for being “in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States.”

Section 102 (b) states that “[a] person shall be entitled to a patent unless . . . the invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States . . .”  The district court found that Honeywell claims were not invalidated by public use or commercial sale, and the Federal Circuit agreed. 

No On Sale Bar Since Transfer Was For Experimental Use and Was Not Commercial

According to Pfaff v. Wells Elec. Inc., 525 U.S. 55 (1998), for there to be an on sale bar, an invention must 1) be the subject of a commercial sale or offer for sale, and 2) be ready for patenting at the time of the sale or offer, to be unpatentable under the on-sale bar.  In reviewing the facts of the case, in 1994, Honeywell conducted negotiations with Gulfstream and Canadair to incorporate the Honeywell system into luxury planes.  However, these projects were for experimental purposes so that Honeywell could test the systems with human pilots in real cockpit setting.  Also, Honeywell did not refer to the system as ready for sale and the record shows that negotiations and proposals before the critical date were for experimentation purposes.   As such, there was no commercial sale pending in 1994.

Additionally, the record indicates that Honeywell’s invention was not ready for patenting before the critical date.  According to the Federal Circuit, an invention is ready for patenting “when evidence shows that the invention was reduced to practice or described in a written description sufficient to permit one of ordinary skill in the art to practice the invention without undue experimentation”.  The record shows a videotape of Honeywell’s system on an aircraft before the critical date and other documentation, including an article (the “George article”) published in June 2004 and which described a flight with this developmental system.  However, the testing of the system was conducted to reduce the invention to practice, rather than to show actual reduction of the invention.  Thus, this evidence merely demonstrates that the invention was not ready for patenting at that time.  As such, the 1994 negotiations were not an on sale bar for purposes of 35 U.S.C. 102(b).

No Public Use Since Use Was Experimental

Regarding the George article, Universal argues that it demonstrates public disclosure, but the district court concluded that the “George article clearly indicates that the system is in its developmental phase.”  A patent will be barred by public use when the invention has been in public use for more than one year before the filling of the patent, and such use does not have confidentiality restrictions and does not involve permitted experimentation.  Allied Colloids Inc. v. Am. Cyanamid Co., 64 F.3d 1570 (Fed. Cir. 1995).  In order to determine when a use is a public use as opposed to an experimental use for purposes of 35 U.S.C. 102(b), the Supreme Court stated that “a bona fide effort to bring [the] invention to perfection, or to ascertain whether it will answer the purpose intended” does not constitute “public use.”  City of Elizabeth v. Am. Nicholson Pave Co., 97U.S. 126, 137 (1877).  In the present case, Honeywell conducted demonstrations of its system to industry people aboard an aircraft using a laptop computer with the demonstration system.  While these test flights did result in the George article, these demonstrations were performed to demonstrate the workability of the system, and thus were experimental and not public uses which would bar patentability of the invention.

Federal Circuit Finds No Public Use

In Motionless Keyboard Co. v. Microsoft et al., 486 F.3d 1376; 82 U.S.P.Q.2D 1801  (Fed. Cir. 2007), Motionless appealed a summary judgment finding that there was no infringement of Motionless’ two keyboard patents, U.S. Patent No. 5,332,322 (the ‘322 patent) and U.S. Patent No. 5,178,477 (the ‘477 patent), based on claim construction and finding that the patents were invalid based on public use and the later patent invalid for obviousness.  Motionless appealed the claim construction ofU.S. the ‘322 patent and the finding of invalidity of the ‘477 patent, and the 322 patent.

The Federal Circuit affirmed the narrow claim construction, construing “a concavity in said housing at said key actuation position, and a thumb-associable cluster of keys forming a keyboard within said concavity” to mean a depression within the housing within which the keys were placed.  This claim construction was supported by the specification and the renderings.  The Federal Circuit reversed the public use application in this case because the disclosures to potential inventors did not demonstrate the device in actual use, and merely showed the design and was never used “in the normal course of business.”  The Federal Circuit also reversed the finding of obviousness because a terminal disclaimer to make a patent coterminous is “simply not an admission of obviousness.”

Facts

The two patents at issue were developed by an independent inventor working in his spare time to create an ergonomic keyboard.  While the device was in development, it was disclosed to several potential investors under a two-year non-disclosure agreement (NDA) in 1987.  The device was also disclosed to a friend in 1987, who did not sign a NDA.  In none of these disclosures was the device connected to a computer or demonstrated the ability to input data to a computer.  On July 25, 1990, a typist was asked to test the device, which was connected to a computer.  The typist did not sign a NDA before testing the device, but did sign one later that day.

The patent application for the ‘477 patent was filed on June 6, 1991.  The application for the ‘322 patent was filed as a continuation-in-part on January 11, 1993.  In addition, a terminal disclaimer was filed for the ‘322 patent to make it coterminous with the ‘477 patent.

Subsequently, the inventor’s assignee, Motionless Keyboard Company (MKC), sued Microsoft Corp. and Saitek Industries Ltd. each for manufacturing an infringing joystick, and Nokia, Inc, for manufacturing an infringing cell phone.

The district court granted summary judgment finding that there was no infringement, either directly or through the doctrine of equivalents and that the patents were invalid due to public use and the ‘322 patent was additionally invalid due to obviousness.  Motionless appealed finding of no infringement for the ‘322 patent and the invalidity of both patents.

Claim Construction

The independent claim of patent ‘322 whose construction is at issue claims: 1. A hand-held device for entering information into an electronic system via a keyboard, the device comprising: … a concavity in said housing at said key-actuation position, and a thumb-associable cluster of keys forming a keyboard within said concavity, each of the plurality of keys in said cluster being selectively actuable via mixed lateral and slight endo, translation of a thumb within said concavity, whereby information is entered into an electronic system.

The district court construed the ‘322 claim to mean “that the concavity must be formed by a depression in the housing of the device, and that all keys comprising the keyboard must be contained entirely within the concave area and sunk below the surface of the housing, so that the thumb movement occurs within the concave area.”

On appeal, MKC argued that the concavity described means “that the tops of the keys themselves can form a concavity within the housing.”  The Federal Circuit, agreed with the district court’s narrower reading, finding the limitations in the phrases “a concavity in said housing” and “a keyboard within said concavity” to define a “depression within the housing of the device and set the keyboard entirely within that depression.”  The court also references the specification, which reads: “a keyboard is positioned in a concavity or depression in the housing” (emphasis in opinion), and the renderings, which all show a “concavity in the housing of the device with the keyboard totally within the concavity.”  As such, the Federal Circuit found that the district court property used the intrinsic evidence in the specification to define the claim term “concavity.”

Direct Infringement

In applying the claim construction the Federal Circuit affirmed the district court’s finding that there was no infringement.  Neither Microsoft’s nor Saitek’s joysticks contain a concavity, nor do the keys of any joysticks extend beyond the surface of the housing.   In the Nokia phone, the keys protrude through an opening in the housing.  Though some phones do “contain keys with slight depressions, these keys do not constitute a concavity in the housing according to the ‘322 patent.”

Doctrine of Equivalents

The Federal Circuit found that MKC failed to present particularized evidence that linked the accused products to the patent.  The Federal Circuit, citing PC Connector Solutions LLC v. SmartDisk Corp., 406 F.3d 1359, 1364, which cites Texas Instruments Inc. v. Cypress Semiconductor Corp., 90 F.3d 1558, 1567, requires a patentee to “show particularized evidence and linking argument as to the ‘insubstantiality of the differences’ between the claimed invention and the accused device, or with respect to the ‘function, way, result’ test.” 

As applied to the joysticks, the Federal Circuit found that MKC used only the claim charts to show substantial similarities of form, function, and result.  This does not constitute particularized evidence of insubstantial differences, or the same ‘function, way, result’ test.  Without particularized evidence, the court did not need to further address the doctrine of equivalents.

As applied to the Nokia phones, the Nokia phones were not activated in the same way as the MKC patent.  “While the patentee’s invention points to actuation of the keys by thumb movement within the concavity, a user would actuate the Nokia keys by pressing them downward.”  Without particularized testimony to specifically show the keys work in the same way, the Federal Circuit affirmed the district court’s ruling on equivalency.

Public Use

The district court held that because the invention was disclosed to investors prior to the critical dates (June 1991 and January 1992) and the inventor’s business partner was not under an obligation to keep the invention secret, the invention had entered public domain.  The district court found the NDAs inconsequential because “a confidentiality agreement will not preclude application of the public use doctrine, if the device was disclosed for commercial purposes,” citing Kinzenbaw v. Deere & Co., 741 F.2d 383, 390.  The Federal Circuit reversed the finding of public use with respect to both patents.  The Federal Circuit cites the policy considerations from Invitrogen Corp. v. Biocrest Mfg., L.P., 424 F.3d 1374, 1379 (Fed. Cir. 2005) (quoting Plaff v. Wells Elecs., Inc., 525U.S. 55, 64 (1998)) that public use arises from the “reluctance to allow an inventor to remove existing knowledge from public use.”  However, such policy does not automatically render every use a public use.

The Federal Circuit determined that the disclosures to potential investors, a friend, and a business partner did not constitute public use.  This result was even though the applicable NDAs, in the case of the potential investors, had expired before the critical dates.  These disclosures “only provided a visual view of the new keyboard design without any disclosure of the [invention’s] ability to translate finger movements into actuation of keys to transmit data.  In essence, these disclosures visually displayed the keyboard design without putting it into use.”

The Federal Circuit distinguished the disclosure to the typing tester from the situations in Egbert, in which an inventor gave two samples of the invention to a friend who used them for two years, and Electric Storage Battery, in which the “ordinary use of a machine [. . .]  in a factory in the usual course of producing articles for commercial purposes.”  In both cases, in which public use was found, the invention was used for its intended purpose before the critical date.  Here, the invention was not used in public, for its intended purpose, nor given to anyone else for such purposes.  “In this case, the one time typing test coupled with a signed NDA and no record of continued use of the [invention] by [the typing tester] after [the day tests were performed] did not elevate to the level of public use.”

Obviousness Based Upon Filing of a Terminal Disclaimer

The district court determined the ‘322 patent was invalid for obviousness because a terminal disclaimer was filed to make the ‘322 patent coterminous with the ‘477 patent, reasoning that it was a concession of obviousness.  Citing Quad Envtl. Tech Corp. v. union Sanitary Dist., 946 F.2d 870, 874 (Fed. Cir. 1991), the Federal Circuit reversed, because “[a] terminal disclaimer simply is not an admission that a later-filed invention is obvious.”  As such, the mere filing of a terminal disclaimer does not represent an admission of obviousness.