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The Equitable Scope of a Claim Under Reverse Doctrine of Equivalents Is Determined by the Specification, Prosecution History, and the Prior Art

July 09, 2008

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Last Month at the Federal Circuit - August 2008

Judges: Michel, Prost (author), Hochberg (District Judge sitting by designation)

[Appealed from: N.D. Cal., Judge Jenkins]

In Roche Palo Alto LLC v. Apotex, Inc., No. 08-1021 (Fed. Cir. July 9, 2008), the Federal Circuit affirmed the district court’s grant of SJ for Roche Palo Alto LLC and Allergan, Inc. (collectively “Roche”), finding Roche’s patent is not invalid and is infringed by Apotex, Inc. and Apotex Corp. (collectively “Apotex”). The Court found no error in the district court’s holding that the reverse DOE is inapplicable and that claim preclusion prohibits Apotex from raising other validity challenges.

Roche owns U.S. Patent No. 5,110,493 (“the ’493 patent”). Claim 1 is directed to a drug formulation for treatment of eye inflammation, comprising a nonsteroidal anti-inflammatory drug, such as ketorolac tromethamine (“KT”); a quaternary ammonium preservative, such as benzalkonium chloride (“BAC”); and a nonionic surfactant, octoxynol 40 (“O40”). Dependent claim 7 further includes sodium chloride (“NaCl”).

Over the years, Apotex filed two ANDAs for generic formulations of Roche’s products. Both formulations include O40, KT, BAC, and NaCl. The concentration of O40 in the first ANDA (“ANDA-1”) and the second ANDA (“ANDA-2”) are both within the range claimed in claim 1 of the ’493 patent.

Roche’s predecessor, Syntex (U.S.A.) LLC (“Syntex”), sued Apotex based on the ANDA-1 formulation in a prior infringement action where the Federal Circuit affirmed the district court’s decision that the ’493 patent is not invalid for obviousness and has been literally infringed. Syntex (U.S.A.) LLC v. Apotex, Inc., 221 F. App’x 1002 (Fed. Cir. Apr. 9, 2007). Four years after the ANDA-1 suit was filed, Roche sued Apotex for infringement of the ’493 patent based on the ANDA-2 formulation. The district court granted Roche’s motion for SJ of infringement. Apotex appealed.

On appeal, Apotex did not dispute that the ANDA-2 formulation falls within the literal scope of claim 1 of the ’493 patent, but argued there is no infringement under the reverse DOE. Citing the Supreme Court’s decision in Graver Tank & Manufacturing Co. v. Linde Air Products Co., 339 U.S. 605 (1950), the Federal Circuit observed that the reverse DOE applies when “a device is so far changed in principle from a patented article that it performs the same or similar function in a substantially different way, but nevertheless falls within the literal words of the claim.” Slip op. at 8 (quoting Graver Tank, 339 U.S. at 608-09). The Court noted that the accused infringer bears the burden of showing a prima facie case of noninfringement under the reverse DOE. The Court also noted that it has never affirmed a finding of noninfringement under the reverse DOE.

Relying on the declaration of its expert, Apotex contended that a person of ordinary skill in the art would recognize that the “principle” of the ’493 patent is the use of O40 in an amount sufficient to cause the formation of micelles, which stabilizes the formulation by preventing interactions between KT and BAC. Apotex argued that it is of no consequence that the intrinsic evidence does not mention “micelles” because a person of ordinary skill in the art knows that O40 stabilizes the formulation by forming micelles. Because the ANDA-2 formulation uses NaCl rather than the micelles to prevent KT from interacting with BAC, Apotex asserted that ANDA-2 functions in a “substantially different way” from the formulation claimed in the ’493 patent.

The Federal Circuit agreed with the district court that Apotex failed to set forth a prima facie case of noninfringement under the reverse DOE because it did not properly establish the principle of the ’493 patent. The Court first noted that the “principle” or “equitable scope of the claims” is determined by the claims, specification, prosecution history, and prior art, as opposed to Apotex’s sole reliance on the declaration of an expert. The Court then found the intrinsic evidence was inconsistent with Apotex’s proffered principle of the ’493 patent and agreed with the district court that Apotex failed to make out a prima facie case of noninfringement under the reverse DOE.

Apotex next asserted that the district court erred in holding that claim preclusion barred its validity challenges because the instant litigation does not involve the same claim or cause of action. Under Federal Circuit law, the Court noted that an infringement claim in a second suit is the same as a claim in an earlier infringement suit if the accused products in the two suits are “essentially the same.” Specifically, the devices are “essentially the same” if the differences between them are merely “colorable” or “unrelated to the limitations in the claim of the patent.”

Apotex contended that the ANDA-2 formulation is not essentially the same as the ANDA-1 formulation because it is stabilized by the use of NaCl as opposed to O40. Apotex argued that this difference created a genuine issue of material fact as to whether the two ANDA formulations are essentially the same. The Court found no error in the district court’s analysis, as the concentrations of O40 in the ANDA-1 and ANDA-2 formulations were both within the ranges claimed in the ’493 patent. The Court thus concluded that the differences are unrelated to the claims and the two formulations are “essentially the same.”

In the alternative, Apotex argued that claim preclusion should not apply because the law of obviousness for invalidity challenges was changed by the Supreme Court’s KSR decision. The Court held the district court correctly recognized that there is no change of law or fairness exception to prevent application of claim preclusion. Thus, the Court held that the KSR decision does not prevent application of claim preclusion and found the district court did not err in finding Apotex’s validity challenges were barred by claim preclusion.