Center for Advanced Study & Research on Intellectual Property

 

CASRIP Newsletter - Summer 1996, Volume 3, Issue 2

New Policy in Interpreting Japanese Patents: Osaka High Court Affirming Infringement of Genentech's t-PA patents under the Doctrine of Equivalents

Toshiko Takenaka

On March 29, 1996, the Osaka High Court reversed the Osaka District Court's decision, and found that Sumitomo's t-PA infringed Genentech's pioneer patents for human t-PA under the doctrine of equivalents. Since this case may turn around Japanese case law on patent claim interpretation 180 degrees to be in line with German and U.S. case law, I have included a summary of the case, as well as my comments on the comparative law aspects.

Decision of Osaka High Court (Osaka Koto Saibansho) March 29, 1996
Case No. Heisei 6 (ne) 3292

Background

The plaintiff-appellant, who owns two patents for a human tissue plasminogen activator (t-PA), sued the defendant, who was preparing to manufacture and sell a human tissue plasminogen activator, in order to prevent the defendant from engaging in such manufacture and sale. Claims of Patent A issued to the plaintiff read:
1. A recombinant human tissue plasminogen activator resulting from a non human host cell, having no other human protein, which activator is characterized by
1) a function to convert plasminogen to plasmin;
2) an ability to provide an affinity for fibrin
3) an ability to immunoprecipitate with antibody against human tissue plasminogen activator originating from Bowes melanoma cell line
4) an amino acid sequence providing a kringle region and serine protease region; and
5) either single or multiple amino acid; and
comprises a segment of 89th to 527th amino acid as indicated in the appendix 1 (the appendix is not included in this case comment).

2. A method for manufacturing a recombinant human tissue plasminogen activator having no other human protein, comprising steps of culturing non human host cell transformed with a DNA sequence encoding human tissue plasminogen under conditions to enable said host cell to express said DNA; whereby providing a recombinant human tissue plasminogen activator characterized by
1) a function to convert plasminogen to plasmin;
2) an ability to provide an affinity for fibrin
3) an ability to immunoprecipitate with antibody against human tissue plasminogen activator originating from Bowes melanoma cell line,
4) an amino acid sequence providing a kringle region and serine protease region; and
5) either single or multiple amino acid; and comprises a segment of 89th to 527th amino acid as indicated in the appendix 1; and recovering said recombinant human tissue plasminogen activator.

3. A medicine for the treatment of thrombosis comprising an amount of recombinant human tissue plasminogen activator resulting from a non human host cell, having no other human protein, which amount is sufficient for such treatment and mixed with a carrier permissible as a medicine, which activator is characterized by
1) a function to convert plasminogen to plasmin;
2) an ability to provide an affinity for fibrin
3) an ability to immunoprecipitate with antibody against human tissue plasminogen activator originating from Bowes melanoma cell line,
4) an amino acid sequence providing a kringle region and serine protease region; and
5) either single or multiple amino acid; and
comprises a segment of 89th to 527th amino acid indicated in the attached appendix 1.

The only claim of Patent B read:
A microorganism, yeast, and mammal cell transformed by a recombinant expression vector containing a DNA sequence encoding human tissue plasminogen activator, having a sequence of 1st to 527th amino acids listed in the attached appendix 1.

The defendant requested a trial of nullity on both patents, but the request was rejected by the Japanese Patent Office. Plaintiff sued another Japanese pharmaceutical company for infringement of the same patents. The Osaka District Court found for Plaintiff because that company's t-PA included a sequence of amino acids as they are listed in the claims, although the sequence also included some insignificant amino acids. In contrast, the same court found no infringement for this case since one amino acid was different from the claimed sequence. The court declined looking at sources other than the claims, stating that it was not necessary to make reference to other sources when the invention was clear from the claim language. Since one amino acid was missing from Defendant's t-PA, the court did not find literal infringement. It also rejected the plaintiff's request to apply the doctrine of equivalents, emphasizing third parties' interests in relying on the claims. The plaintiff appealed, arguing that the defendant's product was substantially the same or equivalent to the patented invention.

In determining equivalency, the parties' arguments focused on the obviousness of replacing valine with methionine, because the replacement was the only structural difference between the patented inventions and the defendant's product. The plaintiff emphasized that the patented inventions were pioneer inventions. To establish non-equivalency, the defendant argued that its t-PA was developed independently from the patented inventions.

Opinion

The contested decision is set aside and the defendant-appellee is sustained from engaging in infringing activities. The plaintiff-appellant's appeal is admissible.

I. Infringement by Equivalents

As arguments by the parties indicate, it is not automatically clear whether the invention including met-t-PA is substantially the same as the invention including val-t-PA. Since an invention is defined as a highly advanced creation of a technical idea using a law of nature, courts must put weight on experts' (those skilled in the art) opinions and views in deciding whether an accused embodiment falls within the technical scope provided in Article 70. Unless the experts can understand the technical scope of the patented invention with no uncertainty on the basis of the claim, claim language is not the only resort for determining the technical scope of a patented invention. Although an invention, which is the subject matter of a patent, i.e., an industrial property right, is described in a claim, the content described in claims is simply the gist of the invention. Since an invention is intangible, its structure must be described in terms of words. It should be noted that although Article 70 provides a means with which to decide the technical scope of the invention on basis of claim language, it does not limit the scope to only cover the literal scope of the claim. Because it is impossible to fully describe the structure of an intangible subject in terms of words, Article 70 provides courts with the flexibility to decide the scope in granting an injunction based on a patent, on the basis of the claim language. The question of whether an accused embodiment falls within the technical scope of a patented invention is a step to define the outermost boundary of the technical scope and is solved by the court which decides infringement.

If an accused embodiment corresponds to the claimed invention and thus is clearly found by one skilled in the art to fall within the technical scope, patent law requires a method for determining the technical scope of a patented invention. This enables courts to find such embodiment being equivalent to the patented invention, even if the embodiment neither literally infringes the claim, nor meets every element of the claim.

In affirming infringement by an embodiment which is not literally the same as the structure of patented invention, courts must pay attention to third parties' interests, which rely on the technical scope based on the claim language, in balance with the patentee's interest. It is necessary to establish a standard to balance both interests. In scholarly opinions, two elements of interchangeability and obviousness of interchangeability are proposed as requirements to find equivalency to establish such a standard. Therefore, the parties' dispute in this case centers on whether the accused product meets the two elements. These two elements are positive requirements to affirm equivalency. On the other hand, there are other elements in particular cases, such as some facts in patent prosecution which may prevent courts from finding equivalency. In determining whether the defendant's t-PA including met-t-PA is equivalent to Patented Invention A or B including val-t-PA, courts must affirm equivalency by examining every positive and negative element, while confirming that the finding of equivalency would not upset the balance between interests of third parties, who rely on the descriptions in the claims, and those of patentees.

II. Evaluation With Respect To Positive Elements for Equivalents

1 Interchangeability

It is not disputed that all amino acid sequences in patented t-PA and defendants' t-PA are exactly the same, except that the 245th amino acid in patented inventions A and B is valine, whereas the corresponding acid in the defendant's t-PA is methionine. The defendant also does not dispute that its t-PA has the characteristics cited in the claims of Patents A and B. Accordingly, the defendant's t-PA provides the same function as the patented t-PA, and thus satisfies the interchangeability element.

2 Obviousness of Interchangeability

Expert Opinions

(Courts listed 11 expert opinions obtained from distinguished professors in molecular biology.)

In summary, the experts' opinions on whether one skilled in the art would have readily obtained the defendant's thrombolytic agents by replacing valine with methionine is as follows:

  1. valine and methionine behave similarly in structuring three dimensional protein structure.
  2. transformation from valine to methionine in protein amino acid sequences occurs relatively frequently. This transformation does not affect the function of the protein (trivial transformation).
  3. t-PA's 245th position is buried in the hydrophobic region of the three dimensional structure of the protein and has no significant role in relation to biological activity.
  4. If a sequence of amino acids is identified, one skilled in the art could have manufactured a t-PA variation wherein some amino acid residues are replaced, deleted or added by manufacturing t-PA's cDNA and changing a segment of the canonical amino acid sequence in the t-PA.
  5. The significance of Patented Inventions A and B is to express a t-PA cDNA encoding a recombinant t-PA which provides a biological activity.
  6. In the scientists' view, the significance of the first successful cloning of a t-PA c-DNA and producing a recombinant t-PA is vastly greater than subsequently repeating the cloning of t-PA by making reference to the disclosure of the first cloning procedure.
  7. Production of a different form of t-PA by making reference to the amino acid sequence of t-PA has no practical use, unless the different form of t-PA provides improved characteristics.
  8. Cloning errors occur very frequently. In most cases, such errors result from replacements of insignificant amino acid residues with similar amino acid residues which do not affect the function of the protein. When a protein resulting from a cloning error has the same function as that of the original protein, the error results from a replacement of insignificant amino acids with similar amino acids. Therefore, one skilled in the art could have known that the protein in a different form resulting from the error would have the same function as the original protein.

Technical Objective of Patented Inventions A and B

On the priority date of Patented Inventions A and B, natural t-PA was only produced by isolating t-PA from human cells, and the quantity produced by this isolation was very small. Although production of useful proteins through recombinant DNA technology was about to become a reality, the production of t-PA through recombinant DNA technology was very difficult, because only a very small quantity of natural t-PA is available, the concentration of t-PA mRNA is extremely low; and t-PA mRNA consists of a very long sequence. Based on the state of art as discussed, the objective of Inventions A and B is to produce a sufficient quantity of t-PA through a recombinant DNA and to develop t-PA thrombolytic agents. Inventions A and B achieved the objective by determining the sequence of a full-length t-PA clone, which is essential to produce t-PA through recombinant DNA technology. This results in information disclosure which enables one skilled in the art to produce a sufficient quantity of t-PA which is capable of replacing natural t-PA, and a sufficient quantity of t-PA to conduct animal and clinical experiments for governmental approvals to commercialize t-PA as medicine.

Significance of Inventions

With respect to the objective, the significance of Inventions A and B relies on a form of t-PA, i.e., an invention of a product, obtained through a recombinant DNA technology. The list of amino acids in the claims indicates that the invention identified t-PA and discovered all amino acids in t-PA. The t-PA claimed as Inventions A and B is defined as a t-PA obtained through a recombinant DNA technology.

The disclosure of Inventions A and B enabled one skilled in the art to understand the manufacturing method of t-PA with the disclosed characteristics through a recombinant DNA technology. One skilled with his or her general knowledge in the art would have been able to produce a sufficient quantity of t-PA, which was not possible by conventional methods.

As the findings from the expert opinions indicate, if the amino acid sequence of t-PA is identified, t-PA in various forms could be produced. This is also discussed in the specification. These findings support the view that one skilled in the art, with the general knowledge available on the priority date of Inventions A and B, could have readily made t-PA in various forms by replacing a portion of the amino acid sequence recited in the claims, so as to obtain a form of t-PA with improved characteristics. In the scientistsÕ view, unless a t-PA in a different form reveals characteristics superior to that of the original t-PA, the modified t-PA does not have any practical significance above that of the original t-PA.

Because the 245th position is not in a significant region, the replacement of valine with methionine does not affect the function of the protein, and a t-PA in a different form would have been readily made; it was highly possible or expected on the priority date, for one skilled in the art, to replace valine in the 245th position with methionine in the t-PA protein so as to obtain a t-PA in a different form with a function comparable to that of the original t-PA. The defendant's witness's statement that the defendant's t-PA resulted from a cloning error also supported that it was well expected for one skilled in the art to obtain a t-PA in a different form resulting from a cloning error.

(The court rejected defendant's arguments that a replacement of valine with methionine would change the characteristics of the protein, relying on the expert opinions that the characteristics of defendant's t-PAs is indistinguishable from those of the patented t-PA.)

III. Negative Element: Prosecution History

1. Prosecution History of Patented Inventions A and B The original application for Invention A included sixteen claims, including a claim which reads: 'a DNA human tissue plasminogen activator, having substantially no other human protein.' During the examination of the opposition against the application, the JPO examiner upheld the opposition and rejected on the basis of lack of enablement. The examiner agreed with the opponent that the claim was too broad compared with the disclosure. The published claims covered any t-PA having characteristics cited in the claims, which are comparable to the characteristics of natural t-PA. The application, however, did not include any disclosure on variations where amino acid residues in positions 69 through 527 were replaced. Since the characteristics of t-PA in a different form were unknown, the claim scope including these unknown variations was not permitted. In the trial against the decision of refusal, the plaintiff gave up and limited the claims to include a list of amino acids in positions 69 to 527.

Similarly, the original application of Invention B did not include a list of amino acids, and was rejected for lack of enablement, on the ground that the claims were too broad compared with the disclosure in the specification. To overcome this rejection, the plaintiff introduced the list of amino acids in positions 1 to 527 positions. In its argument accompanying the amendment, the plaintiff emphasized that the introduction of the limitation on the specific sequence of amino acids should not be interpreted to exclude t-PA in different forms, which would be obvious to one skilled in the art from the amino acid sequence cited in the amended claims. This amendment did not satisfy the JPO examiner. The defendant again amended the claim and deleted the words "allelic variations" and "derivatives," these words were pointed out by the examiner as being not fully supported by the disclosure in the application.

Although the claims were amended to recite only the particular amino acid sequence, the specification of Patent Invention A described possible variation resulting from single or multiple amino acid substitutions, deletions, additions or replacements, and made clear that the scope of this invention comprised these variations, as long as they maintained the characteristics of human tissue plasminogen activator. The specification of Patent B also maintained a description that the term "a DNA sequence encoding human tissue plasminogen activator" included all DNA encoding all allelic variations and modifications resulting in derivatives of human tissue plasminogen activator.

These facts in the patent prosecution indicate that the limitation of amino acid sequence was introduced to meet the requirement provided in Article 36, because variations included in the original claims were not supported by the disclosure in the specification. When a claim is amended to overcome the rejection for lack of novelty or inventive step, the invention is not patentable if its scope is interpreted beyond the literal claim scope. Thus, the interpretation is not permissible. In comparison, when a claim is amended to clarify the description of an invention, the interpretation beyond the literal claim scope would not result in lack of novelty or inventive step and thus should be permissible. Communications from the examiner do not indicate that all variations were excluded from the technical scope of patented t-PA. Thus, no fact in the patent prosecution history gives rise to an element to prevent the court from finding equivalency. No plaintiff's argument gives rise to the application of estoppel.

IV. Argument of Independent Development

A product or method infringes a patent as long as it falls within the technical scope of the patented invention regardless of its independent development from the patented invention. Evidence of the defendant's copying of the patented invention is indirectly relevant to suggest that the interchangeability and obviousness of interchangeability elements are met in affirming equivalency. An argument of independent development is relevant to refute the plaintiff's contention that the accused product meets the two elements of interchangeability and obviousness of the interchangeability, because the defendant copied the patented invention. Because a finding of infringement does not rest on the subjective awareness of the defendant, argument of independent development is not directly relevant to establish non-equivalency by the defendant.

In this case, the plaintiff did not introduce the evidence of the defendant's copying of the patented t-PA. Thus, the defendant's argument was not relevant in determining equivalency.

(Despite the irrelevancy of the evidence on independent development, the court examined evidence on the defendant's process of developing its t-PA and rejected the argument that the defendant independently developed the t-PA.)

V. Conclusion

In summary, no fact which prevents a finding of equivalency was found, and a finding of equivalency between the patented inventions and defendant's t-PA does not upset third parties' reliance on the patent claims. Accordingly, the defendant's t-PA is equivalent to the patented t-PA. The defendant's t-PA, its manufacturing method and thrombolytic agents fall within the technical scope of the patented invention.

It is established that the defendant has cultured accused cell and is preparing to manufacture and sell or is manufacturing and selling the accused thrombolytic agents by using the accused method. Since these activities constitute infringement of the plaintiff's patents, the plaintiff's request to enjoin the activities, and destroy the accused products, is lawful.

Comments

This case is very important, not only because it may completely change case law direction on Japanese claim interpretation, but also because it involves pioneer inventions owned by a U.S. biotechnology company; the significance of the invention is great, not only to that company, but also to U.S. Industry. The Osaka District Court's denial of finding infringement almost resulted in trade disputes between the U.S. and Japanese governments. Interestingly, an infringement suit was also brought in the United States in relation to the form of the t-PA adopted by the defendant of the Osaka High Court case, on the basis of the U.S. patents corresponding to Japanese patents in this case (although the U.S. patent claims did not include the limitation of amino acid sequence). In appeal from the jury verdict of infringement, the defendant in the U.S. case did not appeal on the issue of infringement concerning the form of t-PA that was at issue in the Japanese case. Regarding the U.S. defendant's FE1X protein, a different product from the Japanese defendant's product, the Court of Appeals for the Federal Circuit found no infringement.

Japanese patent law has been extensively criticized for its narrow claim interpretation and its reluctance to find infringement under the doctrine of equivalents. As shown by the first instance decision of this case, when the disputed claim does not literally cover the accused embodiment, Japanese courts typically find no infringement and reject the patentee's request to apply the doctrine of equivalents, giving weight to third parties' interests and to legal certainty. When parties dispute a claim term as to whether the claim includes the accused device, courts find that the claim does not clearly specify the invention, and limits the scope to the scope explicitly or implicitly disclosed in the specification. The recent cases, however, indicate a new tendency of Japanese courts which favors the patentee's interests, although even in a most progressive case, the Tokyo High Court carefully avoided using a term "equivalency or equivalents" as the reason to extend the protection beyond the claims' literal scope.

The Osaka High Court's determination to change the case law and affirm the doctrine of equivalents is clear from its discussion of patent law policy. In civil law countries, particularly Japan, courts' opinions do not include an extensive discussion on legal theory and policy, since their power is limited to solve the disputes arising in a particular case. This court opinion begins with an extensive discussion of needs for extending the protection beyond the literal claim scope because the nature of words makes it impossible to fully describe an invention, a technical idea, without any ambiguity. The patent policy discussed by the Osaka High Court closely parallels the United States patent policy to make reference to sources other than claims, and to find infringement under the doctrine of equivalents.

An important rule that the Osaka High Court emphasized was that patent claims must be interpreted as if one skilled in the art had read the claim. Claims should be read by making reference to the specification, drawings and general knowledge of one skilled in the art. In other words, the protection scope of Japanese patents includes not only disclosed embodiments, but also those obvious to one skilled in the art. From now on, expert testimony may take a significant role in Japanese patent infringement cases dealing with high technology like biotechnology.

A strong U.S. influence is also shown by the test adopted by Osaka High Court. The court's two-part test, examining (1) whether the amino acid recited in the claims is interchangeable with the amino acid in the defendant's t-PA and (2) whether one skilled in the art would have known or conceived of the replacement of such amino acids, clearly parallels the "interchangeability" and "known interchangeability" tests in determining an insubstantial difference, as adopted by Federal Circuit in Hilton Davis Chemical Company Inc. v. Warner-Jenkinson Co . Similarly, the Osaka High CourtÕs reasoning to reject the defendant's argument of independent development, parallels that of the Federal Circuit in Hilton Davis, stating that the argument is relevant only if the patentee argued that the accused embodiments are copied to establish the interchangeability and known interchangeability between the claimed invention and accused embodiment for finding equivalency. Finally, the Osaka Court's followed the Federal Circuit in limiting the application of prosecution history estoppel only to situations in which limitations are introduced to overcome a rejection for lack of novelty and inventive step. In short, this t-PA case moved Japanese patent claim interpretation in line with United States patent claim interpretation. Since Hilton Davis has moved United States patent claim interpretation to the German counterpart, patent claim interpretation in three major jurisdictions is now in line. Giving the pending disposition before the Supreme Court of Hilton Davis, the test and limitation for the doctrine of equivalents the Osaka High Court used is premature in the United States at this time. For the sake of harmonization, I cannot help hoping that the Supreme Court will affirm the substantial difference test adopted in Hilton Davis.

Last updated 4/27/2012