Center for Advanced Study & Research on Innovation Policy


CASRIP Newsletter - Summer 1996, Volume 3, Issue 2

Supreme Court Agrees with the Federal Circuit as to Trial Judge's Power to Interpret Claims

Toshiko Takenaka

On April 23, 1996, the Supreme Court affirmed the Federal Circuit en banc decision of Markman v. Westview Instruments, Inc. (discussed in the 1995 Spring issue of this newsletter), and unanimously held that "the construction of terms of art within its claim, is exclusively within the province of the court." To examine the jury trial rights in patent infringement litigation, the Court asked "whether infringement cases either were tried at law at the time of the Founding or are at least analo gous to a cause of action that was." When this question was affirmatively answered, the Court examined "whether the particular trial issue (here a patent claim's construction) is necessarily a jury issue."

After finding no direct antecedent of modern claim construction in the historical sources, the Court examined existing precedent, the relative interpretive skills of judges and juries, and statutory policy considerations of claim interpretation, concludin g that the allocation of patent claim construction issue was to the court. The Court found that precedent indicates that patent construction should be determined by the court, because a judge is more likely to properly interpret claims than a jury. Finally, the Court found that the need for uniformity in the treatment of a given patent also supports the court's power to determine the meaning of patent claims.


This case has great significance, not only to patent practitioners but also to other legal professions, in interpreting the Seventh Amendment right to trial by jury. In the past, most jury trial right cases were solved through historical analysis. In Markman, after finding historical analysis unhelpful because of the lack of a direct antecedent to modern claim construction, the Court ruled that existing precedent, relative function of the jury and the judge, and policy considerations must be considered when any historical analysis fai ls to reveal the allocation of a particular issue between the jury and the court. In examining these sources, the Court relied on the expertise of Justice Curtis, a former patent practitioner.

Interestingly, Justice Souter's opinion for a unanimous Court, touched upon the issue of infringement under the doctrine of equivalents, which is now up to the Supreme Court for review (Hilton Davis Chemical Company Inc. v. Warner-Jenkinson Co., 62 F.3d 1512, USPQ2d 1641 (Fed.Cir. 1995)).

Justice Souter wrote that the claim defines the protection and functions to prevent not only the exact copies of an invention, but "products that go to 'the heart of the invention but avoid the literal language of the claim by making a noncritical change' [citation omitted]." By stating so, he indirectly affirmed the presence of the doctrine of equivalents in patent law.

Exclusive Rights of Process Patents: Process Patent for Making Plasmid Extends to hGH, even though Plasmid and hGH are Entirely Different Materials

In Bio-Technology General Corp. v. Genentech., 38 USPQ2d 1321 (Fed.Cir. 1996), the Federal Circuit interpreted the terms of 35 USC Section 271(g) for the first time since the provision was introduced by the Process Patents Amendments Acts (PPAA); s pecifically, the court interpreted "A product which is made by a process patented in the United States." The Federal Circuit affirmed the district court's grant of a preliminary injunction, and held that the defendant's human growth hormone (hGH) was a p roduct made by the plaintiff's patented process for making a plasmid, even through the plasmid resulting from the patented process and hGH were entirely different materials.

Bio-Technology General involved patents directed to a method for directly expressing a human growth hormone. Conventional processes using rDNA technology yielded not only hGH, but also a leader sequence which rendered the resulting product biologi cally inactive. Genentech developed a method which did not yield the leader sequence and expressed only hGH. Bio-Technology General (BTG), which manufactured hGH in Israel, sought a declaratory judgment that Genentech's patents were invalid, unenforceab le and not infringed by BTG's hGH (which BTG planned to import to the United States). Genentech counterclaimed for infringement, and moved for a preliminary injunction to prevent BTG's hGH importation. The district court found for Genentech, finding tha t the BTG's importation of its hGH would infringe Genentech's patents under 35 USC Section 271(g).

In appeal, with respect to Genentech's patent directed to a method for reproducing hGH, BTG argued that its process did not infringe Genentech's process because Genentech's patent should not have been read to include BTG's new patented process (which was not disclosed in the specification of the Genentech patent). The court rejected this argument, stating that the existence of one's own patent does not constitute a defense to infringement of someone else's patent.

BTG also argued that its product did not fall within the literal scope of the disputed claim, because the conversion of the 192 amino acid "met-hGH" into hGH before importation into the United States materially changed the product made by the patented pro cess and, thus, the exception in Section 271(g)(1) had to apply. The court rejected BTG's argument, citing Novo Nordisk of N. Am., Inc. v. Genentech, 77 F.3d 1364 (Fed.Cir. 1995), another case which decided infringement on the same hGH reproduction process claim.

To apply the "materially changed" exception, a real difference must exist between the product imported, offered for sale, sold or used in the United States, and the products produced by the patented process. Since the disputed claim was not limited to a met-hGH production, no such difference existed between BTG's hGH product and the expression product resulting from Genentech's patented process.

With respect to another Genentech patent directed to a method for producing a replicable cloning vehicle (e.g. a plasmid), BTG argued that it did not infringe Genentech's patents because BTG made the plasmid only once in Israel in 1983, before enactment o f Section 271(g). The Federal Circuit rejected this argument, stating that the statute only requires that importation occur during the term of the process patent and after the enactment of the PPAA.

In deciding whether BTG's hGH fell within the product made by the patented process directed to the production of plasmids, the court answered affirmatively, because the claimed process of making the plasmid constituted an essential part of the overall pro cess of making hGH (although the court admitted that the plasmid and hGH were entirely different materials). Moreover, the particular fact situation in this case was precisely anticipated in the legislative history of the Act. The legislature expressed an intent that infringement of a process for making a plasmid was not to be avoided by using the resulting plasmid as part of the overall process (such as a process for making hGH).

After reviewing all BTG's defense arguments, the court found no error in the district court's analysis and affirmed its grant of a preliminary injunction.


This case reflects a typical factual background involving basic inventions and their improvements. BTG's hGH production process using a new purification step was a selection invention of Genentech's process. Under Japanese and German patent law, BTG's pa tent would constitute a dependent patent on Genentech's patent, since BTG's process was patented but within the literal scope of Genentech's process. This would have enabled BTG to request a compulsory license, provided certain public interest requiremen ts were met (for a discussion on case law development on compulsory licensing in Europe, see Michael Kern's report in this issue.)

A more interesting point is the Federal Circuit's interpretation of "product made by patented process." Unlike the United States, which recently extended the exclusive rights of process patents to the resulting product, patent laws in most European and E ast Asian countries have long extended the exclusive right of process patents to their resulting products. Scholars and patent professionals have extensively debated whether the exclusive right extends to products which are materially changed by a subseq uent process, particularly with respect to the coverage of process patents for making chemical intermediates.

In Japan, the process patent's exclusive right extends to products which are materially changed by a subsequent step, because the statute does not limit the product to those directly made by the products. In Europe, the term "directly" is inserted in Com munity Patent Convention Article 25(c) to exclude the products materially changed by a subsequent step. Considering such long standing debates, Japanese and European scholars would have read the "materially changed" exception to exclude the situation in volved in this case. The legislative history record, however, completely removed such a possible interpretation in the United States.

Nonobviousness: Suggestion to Combine References

Can failures of others give a suggestion or motivation to destroy nonobviousness of a later successful invention? The Federal Circuit answered affirmatively in Lamb-Weston Inc. v. McCain Foods, Inc. 78 F.3d 540 (Fed.Cir. 1995), upholding the dist rict court's finding of invalidity with respect to a patent for lattice-shaped french fries called "waffle fries." Although the "waffle fries" had long existed in prior art, the patentee was the first to successfully manufacture waffle fries by partiall y frying and freezing sliced potatoes. The claims included detailed dimensions of the shape and size of parfried slice potatoes.

The district court focused on a prior art analysis -- whether information available only to the inventor could constitute prior art which would make the patented invention obvious -- because the court found a suggestion to combine prior art references from potato slice machines that had been confidentially disclosed to the inventor. These ma chines, previously offered to the patentee, were rejected because the patentee found that the machines made too many unusable slices. Thus, the patentee decided to develop its own machine; subsequently, the patentee filed a patent application on its waff le fries, the slicing apparatus, and the process for making the fries. The disputed patent on the waffle fries was divided from the original application.

In appeal, unlike the district court, the Federal Circuit paid little attention to the machines. Instead, the Federal Circuit found that the potato fries made by using the confidentially disclosed machines gave a suggestion to combine the shape and thick ness of the potato products obtained from the new process, so as to fit into the conventional "parfrying" process (because potato products were outside of confidential agreement and publicly available). Since prior art suggested a motivation to make pota to products of various shapes using a parfry process, and the products made by the confidentially disclosed slice machines taught the appropriate size and shape of waffle fries for a known parfry process, the Federal Circuit found the suggestion to combin e a known parfry process and the shape and size made by the machines; the court then determined that it would have been obvious to one skilled in the art to conceive of the particular shape and size of patented potato products.


In establishing prima facie nonobviousness by combining plural references, explicit or implicit suggestion and motivation must be found in one of the references. In a number of past cases, the Federal Circuit struck down the Patent Office's reject ion of patent grants and district courts' findings of invalidity. According to Professor Chisum, the trend favoring patentees and applicants may be changing. More and more cases are coming down in which the Federal Circuit is upholding findings of obviousness. This case reflects the tre nd.

This case also reminds us of the time when the courts often used legal terms such as "mere combination of old elements" to strike down patentability for obviousness. These terms are now being replaced with "suggestion or motivation in prior art." Profes sor Chisum suggested that courts' change of legal terms sometimes reflects the change of attitude to patentees. Courts may also change the attitude while maintaining the same legal term. In any event, one should learn these terms to effectively communic ate with courts.

In applying a comparative law analysis, the same legal term to strike patentability for lack of inventive step can be seen in the "would vs. could" question. A European Patent Office examiner must establish that one skilled in the art would have combined the various elements in the prior art to reach the invention if he or she reject an application for lack of inventive step. It is not sufficient that one skilled in the art could have done so. Knowledge of some solutions to the problem in the prior art may give rise to the level of "could have," but without a suggestion or motivation to select the solution of the invention, one "would not have" been able to combine the closest prior art with another reference to reach the invention. It is the role of the comparative law specialist to explain the correspondence between different legal terms and differences between the same legal terms.

An interesting point for non-U.S. patent professionals in this case is the discussion of prior art. In the district court, the parties extensively disputed whether information was confidentially disclosed to the inventor. This is because United States p atent law has a complicated definition of prior art, discriminating between the inventors' knowledge and activities and the publicly available information. In other countries, the slice machines could not constitute the state of art regardless of the sou rce of information.

It is important to avoid hindsight in evaluating an invention resulting from the combination of old product and process because, if the product is as common and as long-lived as the potato product in this case, people assume that production by adopting a well known process would not involve any effort. However, as Judge Newman pointed out in her dissenting opinion, the difficulty was well-indicated by the failure of the confidential slice machines.

Although the Federal Circuit does not intend to remove the "suggestion or motivation" requirement, the meaning of the requirement may have slightly changed, and may reflect a trend unfavorable to patentees in which obviousness will be more readily found.

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