A patent is a powerful right. In principle, it permits its owner to bring an accused infringer before a court, stop the offending activity, and collect damages. In reality, though, it doesn’t always do this.
It is far from certain whether a given patent will enable its owner to prevail in an infringement suit. Many factors—such as the accused conduct, the patent claim language, and the state of the law—govern the likelihood of success. Understanding this likelihood of success and the factors that affect it is central to any tactical decision involving the patent or the application preceding it. Indeed, the anticipated outcome of a patent infringement suit affects, among other things, the value of a license to the patent, the value of a company having rights to the patent, and the chances of a suit’s arising in the first place.
Upon learning of a patent, and without ever being threatened with a lawsuit by the patent’s owner, a potential competitor might voluntarily refrain from practicing the patented invention. This avoidance typically stems from an aversion to infringement liability. In this scenario, the patent still performs a preclusive role, but without any effort by the patent owner.
EXAMPLE 9.1
Biotech X manufactures plasmid-based research tools. The company wants to develop and market a new plasmid product for the cell-based testing of drug candidates. Biotech X’s contemplated product contains, among other things, a synthetic fifty-nucleotide region having Sequence X.
Before proceeding with development, Biotech X identifies a recently issued U.S. patent owned by Biotech Y, a competitor. The patent claims a synthetic nucleic acid molecule comprising Sequence X.
Counsel for Biotech X determines that Biotech X’s contemplated product, which contains Sequence X, would likely infringe Biotech Y’s patent.
Biotech Y never threatens Biotech X with an infringement suit or otherwise communicates with Biotech X about its patent. In fact, Biotech Y is unaware of Biotech X’s contemplated product.
Despite the absence of any threat of suit by Biotech Y, and based on the advice of counsel, Biotech X’s CEO jettisons plans to develop its contemplated product and thereby avoids liability for infringing Biotech Y’s patent.
Inaction is not the only way to avoid patent infringement liability. Patent licensing—that is, granting rights under a patent—eliminates the problem of infringement while benefitting all parties. Chapter 18 covers patent licenses and related contracts.
Not all roads lead to litigation, but some do. It is not always the case that a third party able to avoid infringing conduct is willing to do so, a third party able to take a patent license to engage in otherwise infringing activity is willing to do so, or a patent owner able to grant a license under a patent is willing to do so. For these reasons and more, suing a third party for patent infringement is often a patent owner’s best option. For the successful plaintiff, suing an infringer can bring relief in the form of temporary and permanent injunctions, as well as monetary damages like lost profits.
The rest of this chapter presents the different types of patent infringement and the features of each.
An accused technology infringes a patent claim if it satisfies each element (or limitation) of the claim. An entire patent is infringed if at least one of its claims is infringed.
A patent infringement suit is the assertion of a patent owner’s negative right to stop another from practicing the claimed invention. For the patent owner to prevail in an infringement suit, the infringed claim(s) must not be held invalid, and the patent must not be held unenforceable. These two defenses to infringement are addressed in the next chapter.
EXAMPLE 9.2
Company X owns a U.S. patent having claims 1–10.
Claim 1 provides “a twenty-residue synthetic peptide having amino acid sequence X and a 131I atom bound to the peptide’s N-terminal residue.” This peptide is useful as a therapeutic.
Claims 2–10 provide other synthetic peptides, each having a 131I atom bound to the peptide’s N-terminal residue. The peptides of claims 2–10 do not have amino acid sequence X.
In the United States, and without authorization from Company X, Company Y makes and sells a twenty-residue synthetic peptide having amino acid sequence X and a 131I atom bound to the peptide’s N-terminal residue.
Company X sues Company Y for infringing its patent.
The court finds that Company Y’s product satisfies all elements of claim 1. That is, Company Y’s product (i) is a twenty-residue synthetic peptide having amino acid sequence X, and (ii) has a 131I atom bound to the peptide’s N-terminal residue. Thus, the court finds claim 1 infringed.
Since Company Y infringes at least one claim of Company X’s patent, Company Y infringes the entire patent. Company Y’s noninfringement of claims 2–10 does nothing to mitigate this outcome.
Here, though, Company Y’s product does not have a 131I atom bound to the N-terminal residue.
Given the absence of the 131I atom in Company Y’s product, the court finds that it fails to satisfy all elements of claim 1. Although Company Y’s product is a twenty-residue synthetic peptide having amino acid sequence X, it does not have a 131I atom bound to the peptide’s N-terminal residue. The court therefore finds claim 1 not infringed. Assuming that none of claims 2–10 is infringed either, Company Y does not infringe Company X’s patent.
As we learned in chapter 2, a court’s construction of patent claims can profoundly affect the outcome of an infringement suit. Indeed, how a court construes a claim can be the difference between victory for the patent owner and victory for the accused infringer.
EXAMPLE 9.4
Assume the same facts as in example 9.2, except for the following two changes.
First, claim 1 provides “a twenty-residue synthetic peptide having amino acid sequence X and a 131I atom or analog thereof bound to the peptide’s N-terminal residue.”
Second, Company Y’s product is a twenty-residue synthetic peptide having amino acid sequence X and a 225Ac atom bound to the peptide’s N-terminal residue.
Before ruling on the question of infringement, the court must first construe claim 1. In particular, the court must determine what is meant by an “analog” of a 131I atom. Based on the patent itself, the prosecution history, and the other evidence before it, the court determines that an analog of a 131I atom is any therapeutically acceptable radionuclide, such as 225Ac.
Given this broad construction favorable to Company X, the court finds that Company Y’s product satisfies all elements of claim 1. That is, Company Y’s product is a twenty-residue synthetic peptide having amino acid sequence X. It also has an analog of a 131I atom bound to its N-terminal residue, the analog being 225Ac. Thus, the court finds claim 1, and the patent, infringed.
Here, though, the court determines that an analog of a 131I atom is any therapeutically acceptable beta-emitting or gamma-emitting radionuclide.
Given this construction, the court finds that Company Y’s product fails to satisfy all elements of claim 1. That is, it does not have a beta-emitting or gamma-emitting radionuclide bound to its N-terminal residue. Instead, it has the alpha-emitting radionuclide 225Ac bound to its N-terminal residue. Because of this narrower construction favoring Company Y, the court finds claim 1 not infringed. Assuming that none of claims 2–10 is infringed either, Company Y does not infringe Company X’s patent. It is irrelevant to this outcome whether Company Y’s product satisfies the other elements of claim 1.
Each act of infringement has two facets. One is the role played by the accused party. This determines whether the infringement is direct, induced, or contributory. The other is whether the accused conduct falls within the exact language of the claims. This determines whether there is literal infringement or infringement under the doctrine of equivalents. So, one can infringe a patent claim in any of six ways: directly and literally, directly and under the doctrine of equivalents, via inducement and literally, via inducement and under the doctrine of equivalents, contributorily and literally, and contributorily and under the doctrine of equivalents.
Direct infringement is the unauthorized making, using, offering for sale, selling, or importing of a patented invention. A party who directly infringes a patent is the party who actually practices the claimed invention.
EXAMPLE 9.6
Company X owns a U.S. patent claiming a kit for diagnosing paternally transmitted fetal disorder X via analyzing cell-free fetal DNA (cffDNA) in maternal blood. Claim 1 provides a diagnostic kit comprising a solid support, an immobilized nucleic acid probe that targets a disorder X–related cffDNA region, and a reaction mixture permitting visualization of probe/target hybridization.
Company Y sells a diagnostic kit in the United States without authorization. Company Y’s kit includes a solid support, an immobilized nucleic acid probe that targets a disorder X–related cffDNA region, and a reaction mixture permitting visualization of probe/target hybridization.
Company Y directly infringes Company X’s patent by virtue of infringing claim 1. Specifically, it is Company Y itself that practices the claimed invention by selling the kit of claim 1. (Note: If Company Y were to manufacture or import the kit rather than sell it, for example, it would still directly infringe Company X’s patent.)
Inducement to infringe occurs when, without authorization, a party induces another to make, use, offer for sale, sell, or import a patented invention. There can be no inducement to infringe without direct infringement. However, the inducing party is not the one who directly infringes the patent.
EXAMPLE 9.7
Company X owns a U.S. patent to a method for treating depression using Compound X, a small-molecule drug. Claim 1 of the patent provides a method for treating a patient having depression by orally administering a therapeutically effective dose of a pharmaceutical composition comprising Compound X and a pharmaceutical carrier.
Without authorization, Company Y sells an antidepressant drug in the United States. Company Y’s product is an oral formulation that includes Compound X and a pharmaceutical carrier. Importantly, Company Y sells its drug with a label directing patients to take a therapeutically effective dose of the product to treat depression.
A patient following Company Y’s directions by taking Company Y’s product to treat depression would be practicing the method of claim 1 by satisfying each of that claim’s elements. Thus, it is the patient who directly infringes the patent.
Company Y, on the other hand, induces patients to directly infringe Company X’s patent, because it directs them to practice the claimed therapeutic method using its product.
Company X could sue Company Y for inducement to infringe its patent and may or may not choose to do so. What is more, Company X could also sue the patients who take Company Y’s drug as directed, given their role as direct infringers. For various reasons, however, Company X would not likely do so.
Here, though, Company Y sells its product as an anxiolytic drug. That is, even though its product could be used to treat depression, Company Y sells it with a label directing patients to take the drug to treat symptoms of acute anxiety. Moreover, Company Y does not direct patients or otherwise suggest—through advertisements or other methods of communication—that its product be used to treat depression.
Given these facts, if a physician were to make an “off-label” prescription of Company Y’s drug to a patient to treat depression, the patient would again be practicing the method of claim 1 by satisfying each of that claim’s elements. As such, the patient would be a direct infringer.
Company Y, however, would not be liable for inducing infringement, since it has not directed others to practice the claimed method using its product. (Chapter 15 covers off-label use in the context of generic drug prescriptions.)
A party can also infringe a patent without doing so directly or through inducement. Contributory infringement occurs when a party sells a material part of a patented invention without authorization, knowing it to be especially suited to infringing the patent and not suited to any substantial noninfringing use. A material part of a patented invention can be, for example, a component of a patented machine or composition or an apparatus for practicing a patented method.
EXAMPLE 9.9
Biotech X owns a U.S. patent to a DNA chip–based method for performing genetic analysis. Claim 1 provides a method for detecting genetic mutations correlative with malignancies in various tissues.
In part, the method comprises contacting a patient’s DNA sample with a DNA chip under hybridizing conditions. The DNA chip comprises a matrix of several thousand immobilized DNA fragments that, in combination, permit accurately and simultaneously prognosing malignancies in different tissues. The claimed method also requires using common reagents and a common apparatus to visualize and interpret the hybridization patterns on the DNA chip.
Without authorization, Biotech Y, aware of Biotech X’s patent and claimed method, sells a DNA chip in the United States that is designed for use in performing that method. Importantly, Biotech Y’s DNA chip has no substantial use other than performing Biotech X’s patented method.
A third party who purchases Biotech Y’s product and uses it in the United States to perform the method of claim 1 would be practicing the method by satisfying each of its elements. By doing so, this party would directly infringe the patent.
Biotech Y, in the meantime, is liable as a contributory infringer. This is because it sells a material part—a DNA chip—designed solely for use in performing Biotech X’s patented method and having no substantial use beyond that.
Literal infringement of a patent claim occurs when an unauthorized act falls within the claim’s scope as defined by its exact language. That is, every element of the claim is met literally. Direct infringement, induced infringement, and contributory infringement can occur literally, as well as under the doctrine of equivalents.
EXAMPLE 9.11
Company X owns a U.S. patent to a new formulation of known Drug X. Specifically, claim 1 provides “a 1.0 percent solution of Drug X in saline.”
In the United States, and without authorization, Company Y sells a 1.0 percent solution of Drug X in saline.
Company Y literally infringes claim 1 and hence literally infringes Company X’s patent, since its conduct falls within the claim’s scope as defined by its exact language.
Here, though, Company Y sells a 1.2 percent solution of Drug X in saline, again in the United States and without authorization.
Company Y does not literally infringe claim 1. Assuming that it infringes no other claim, Company Y does not literally infringe Company X’s patent either. Company Y’s conduct falls outside the claim’s scope as defined by its exact language, in that “1.2 percent” does not satisfy the literal requirement of “1.0 percent.”
One can avoid literally infringing a patent through activity differing from the claimed invention in only the slightest way. Can one avoid all infringement in this way? What if an accused activity is equivalent to a claimed invention, yet narrowly avoids literally infringing the patent because of insubstantial differences? Does it still infringe the patent?
Under the court-created doctrine of equivalents, the answer is yes. An accused product or method is equivalent to a claimed invention if the accused product or method has at least the equivalent of each element of the patented invention. Equivalence between an element of an accused technology and its corresponding claim element can be shown in different ways. One is to show that it performs the same function in the same way to achieve the same result as the claim element.
A court will not apply the doctrine of equivalents without first considering the patent’s history. Specifically, a patent’s prosecution history can limit how the doctrine is applied to a given claim. This is especially true when, during prosecution, the patent applicant has made statements narrowly characterizing the claimed invention.
Determining infringement under the doctrine of equivalents is typically a nuanced task based on many variables. For this reason, the examples that follow present doctrine-of-equivalents findings in terms of likely outcomes rather than absolute certainties.
EXAMPLE 9.13
Company X owns a U.S. patent to a new formulation of known Drug X. Claim 1 provides “a 1.0 percent solution of Drug X in saline.”
During prosecution, the applicant made no statements or claim amendments limiting the concentration of Drug X in saline. Specifically, the application was originally filed with claim 1 providing a “1.0 percent” solution of Drug X in saline, and the patent was then issued with this same concentration of Drug X. Further, the applicant made no statement, for example, distinguishing this 1.0 percent concentration from a higher concentration in the prior art, such as a 1.3 percent solution of Drug X in saline.
In the United States, and without authorization, Company Y sells a 1.2 percent solution of Drug X in saline. As we know from example 9.12, Company Y does not literally infringe claim 1.
Does Company Y nevertheless infringe under the doctrine of equivalents? It likely does, as long as its product contains elements at least equivalent to each element of the claimed formulation. The sole element in question here is the percentage of Drug X, which is 1.0 percent in claim 1 and 1.2 percent in Company Y’s product. If we assume that a 1.2 percent solution of Drug X performs the same function, in the same way, to achieve the same result as does the 1.0 percent solution recited in claim 1, these two percentages would be considered equivalent.
Under this assumption, and since there is no limiting prosecution history here, Company Y would likely infringe Company X’s patent under the doctrine of equivalents.
Here, though, there is limiting prosecution history. The patent application was originally filed with claim 1 providing an “approximately 1.0 percent” solution of Drug X in saline. During prosecution, the Patent Office rejected the claim over a reference disclosing a 1.25 percent solution of Drug X in saline. In response, the applicant deleted the word approximately in claim 1. The applicant also argued that a 1.0 percent solution has an unexpected therapeutic advantage over a 1.25 percent solution.
We again ask whether Company Y infringes under the doctrine of equivalents. The answer this time is that it likely does not.
By the applicant’s own admission, a 1.0 percent solution has an unexpected therapeutic advantage over a 1.25 percent solution. This statement would probably limit a court’s ability to find a 1.2 percent solution of Drug X equivalent to the 1.0 percent solution recited in claim 1. Put differently, the court, without more, would have difficulty finding a 1.2 percent solution equivalent to a 1.0 percent solution when a 1.25 percent solution is not considered equivalent. (Note: Here, the claimed Drug X concentration is therapeutically superior to that of the known solution. This superiority over the prior art limits the court’s ability to find infringement under the doctrine of equivalents. It is important to remember, though, that any form of nonequivalence—not just superiority—would limit the court in this regard. This point also applies to example 9.16.)
FIGURE 9.1 These Venn diagrams illustrate the infringement scenarios described in examples 9.13 (left) and 9.14 (right). The inner circle represents the literal scope of claim 1, and the ring surrounding it represents its scope under the doctrine of equivalents. In example 9.13, there is no limiting prosecution history, and the 1.2 percent Drug X concentration in Company Y’s product (Y) is equivalent to the claimed 1.0 percent concentration. Thus, Company Y would likely infringe claim 1 under the doctrine of equivalents, as shown by Y’s inclusion in the ring. In example 9.14, however, there is limiting prosecution history. Because of this, a narrow ring surrounds the inner circle to represent whatever scope—if any—the claim might have under the doctrine of equivalents. Also, the 1.2 percent Drug X concentration in Y is not likely equivalent to the claimed 1.0 percent concentration. Therefore, Company Y would not likely infringe claim 1 under the doctrine of equivalents, as shown by Y’s exclusion from the ring.
EXAMPLE 9.15
Biotech X owns a U.S. patent to a therapeutic DNA molecule. Claim 1 provides “a DNA molecule consisting of the sequence GTAACTGTGGCTAAGCTTAG.”
During prosecution, the applicant made no statement regarding claim scope or claim amendment limiting the sequence of the claimed DNA molecule.
In the United States, and without authorization, Biotech Y sells a twenty-mer DNA molecule having the sequence GTAACTATGGCTAAGCTTAG. As we can see, Biotech Y’s product and the claimed molecule differ by one nucleotide residue, making Biotech Y’s product 95 percent homologous to the claimed molecule. Biotech Y therefore does not literally infringe Biotech X’s patent.
As for infringement under the doctrine of equivalents, the question is whether Biotech Y’s product GTAACTATGGCTAAGCTTAG is equivalent to GTAACTGTGGCTAAGCTTAG recited in claim 1. Phrasing it more precisely, as a court would, is the third deoxyadenosine residue in GTAACTATGGCTAAGCTTAG equivalent to the second deoxyguanosine residue in GTAACTGTGGCTAAGCTTAG? Either way, we must ask more than whether deoxyadenosine and deoxyguanosine, by themselves and outside the context of claim 1, are equivalent. We must ask whether they are equivalent under these exact circumstances.
If we assume equivalence between the deoxyadenosine and deoxyguanosine residues in GTAACTATGGCTAAGCTTAG and GTAACTGTGGCTAAGCTTAG, respectively, then Biotech Y would likely infringe Biotech X’s patent under the doctrine of equivalents, since there is no limiting prosecution history in this example.
Here, though, there is limiting prosecution history. The patent application was originally filed with claim 1 providing “(i) a DNA molecule consisting of the sequence GTAACTGTGGCTAAGCTTAG, or (ii) a DNA molecule having at least 90 percent homology thereto.” During prosecution, the Patent Office rejected the claim over a reference disclosing a DNA molecule having 90 percent homology to the DNA of part (i). In response, the applicant narrowed claim 1 by deleting part (ii). The applicant also argued that the DNA of part (i) has an unexpected therapeutic advantage over a DNA molecule having 90 percent homology to it.
Company Y likely does not infringe the patent under the doctrine of equivalents.
By the applicant’s own admission, the claimed DNA is unexpectedly superior to a DNA molecule having 90 percent homology to it. This statement would limit a court’s ability to find equivalence between the DNA of claim 1 and Biotech Y’s DNA, which is 95 percent homologous to it. Put differently, the court, without more, would likely have difficulty finding a 95 percent homologous sequence equivalent to the claimed sequence when a 90 percent homologous sequence is not considered equivalent. Of course, additional facts regarding the two divergent nucleotide residues in the prior-art sequence may or may not alter the outcome, depending on what those facts are.