BRISTOL MYERS SQUIBB SENDS PATENT APPLICANTS AND PATENT PRACTITIONERS A

BRISTOL -MYERS SQUIBB SENDS PATENT APPLICANTS AND PATENT PRACTITIONERS A REMINDER ON THE IMPORTANCE OF 37 C.F.R. § 1.56 by Terry J. Wikberg1 I. Introduction On April 15, 2003, the U.S. Court of Appeals for the Federal Circuit decided BristolMyers Squibb Co. v. Rhone-Poulenc Rorer, Inc.,2 a patent infringement suit appealed from the U.S. District Court for the Southern District of New York. In Bristol-Myers Squibb Co., the core issue was whether or not Rhone-Poulenc Rorer, Inc.’s (“RPR”) U.S. Patent No. 4,924,011 (the “ ‘011 Patent”) and U.S. Reissue Patent No. 34,277 (the “ ‘277 Reissue Patent”) were obtained from the United States Patent and Trademark Office (“USPTO”) through inequitable conduct and, therefore, unenforceable. In affirming the District Court’s decision that both patents were unenforceable due to the inequitable conduct of RPR and its agents and attorneys, the Federal Circuit has reminded patent applicants and patent practitioners of long-standing, but often-forgotten, rules regarding a patent applicant’s duty of disclosure3 to the USPTO. II. Background of the Case In 1987, the inventors of the ‘011 Patent and ‘277 Reissue Patent developed a method for using protecting groups to synthesize taxol, a cancer chemotherapeutic agent.4 The synthesis of taxol was known, but its production created unwanted products that inhibited the efficient production of taxol.5 The inventors of the ‘011 Patent and ‘277 Reissue Patent discovered that incorporating various protecting groups into the synthesis process reduced unwanted reactions, thereby increasing the overall taxol yield.6 Prior to filing any patent applications, the inventors of the ‘011 Patent and ‘277 Reissue Patent wrote an article entitled “A Highly Efficient, Practical Approach to Natural Taxol” (the “Article”).7 A draft of the Article (hereinafter “Draft Article”) was submitted to RPR’s French patent agent.8 The Draft Article stated that the conversion of the compound 10-DAB to taxol “could be successfully achieved only with specific protecting groups and under unique reaction conditions.”9 The Draft Article also identified a number of limitations which resulted from the selection of different types of “protecting groups.”10 After reviewing the Draft Article, RPR’s French patent agent recommended that a patent application be prepared and filed.11 A draft patent application was prepared that did not specify any limitations regarding the type of protecting groups that could be used in the process.12 In fact, RPR’s French patent agent drafted the application to indicate that several of the problematic protecting groups were preferred.13 After the inventors reviewed the draft patent application and suggested no substantive changes, the patent application was filed in France on April 6, 1988.14 The filing of the French patent application was prior to the August 17, 1988, publication of the Article.15 In March of 1989, RPR’s French patent agent sent the French application and a French search report to a U.S. patent attorney. The U.S. patent attorney filed the ‘011 Patent application in the USPTO on April 3, 1989. The Article was never provided to the U.S. patent attorney or to the USPTO during the prosecution of the ‘011 Patent application.16 During the prosecution of the ‘011 Patent application, the Examiner responsible for the application requested the PTO Scientific Library to perform a search of scientific articles containing the chemical structure of claim 1 of the ‘011 Patent application.17 The search generated eleven references, including the Article and an additional article written by two of the inventors of the ‘011 Patent.18 The Examiner listed only the additional article on the “Notice of References Cited” and did not initial either article on the search report from the PTO Scientific Library. The Examiner merely placed the search report within the file history of the ‘011 Patent.19 The ‘011 Patent issued on May 8, 1990, and in June of 1991 RPR’s French patent agent contacted a different U.S. patent attorney about filing a reissue patent application directed to subject matter disclosed but unclaimed in the ‘011 Patent. Additionally, RPR’s French patent agent provided the U.S. patent attorney with a copy of the Article.20 The U.S. patent attorney indicated that the Article would not affect the grant of the ‘011 Patent because the Article was published less than one year prior to the U.S. filing date of the ‘011 Patent.21 On November 1, 1991, the U.S. patent attorney filed the ‘277 Reissue Patent application but did not disclose the Article.22 The ‘277 Reissue Patent application was assigned to the same Examiner who evaluated the ‘011 Patent application. The Examiner conducted a new search which again disclosed the Article.23 On July 17, 1992, RPR’s French patent agent sent a number of references to the U.S. patent attorney, including the Article, but indicated that the references were “irrelevant.”24 After receiving the Article and the other references, the U.S. patent attorney conducted an interview with the Examiner and submitted a response to an outstanding office action, but still failed to submit the Article.25 On December 15, 1992, the U.S. patent attorney filed an information disclosure statement with the USPTO disclosing the Article.26 However, the Examiner did not consider the information disclosure statement until February of 1993, by which time the Examiner had already indicated the ‘277 Reissue Patent application was allowable.27 On June 8, 1993, the ‘277 Reissue Patent issued.28 III. The Decision In October of 1995, Bristol-Myers Squibb filed a declaratory judgment suit in the U.S. District Court for the Southern District of New York against RPR seeking a determination that Bristol-Myers Squibb did not infringe the ‘277 Reissue Patent and that the ‘277 Reissue Patent was invalid and unenforceable.29 RPR responded by filing suit against Bristol-Myers Sqibb in the U.S. District Court for the District of Delaware alleging infringement of the ‘277 Reissue Patent.30 The cases were consolidated in the U.S. District Court for the Southern District of New York. After a number of hearings, the District Court Circuit determined that Bristol showed by “clear and convincing evidence” that (1) the inventors withheld material information from the USPTO during the prosecution of the ‘011 Patent and that the Examiner never considered the Article during the prosecution of the ‘011 Patent, and (2) the Article was intentionally withheld from the USPTO with an intent to deceive.31 As such, the Federal Circuit found that the ‘277 Reissue Patent unenforceable.32,33 On appeal, the Federal Circuit affirmed the District Court’s ruling, finding the ‘277 Reissue Patent unenforceable due to the inequitable conduct of RPR and its agents.34 A. Materiality In agreeing with the District Court that the Article was material to the ‘011 Patent, the Federal Circuit has reiterated the long-standing, but frequently overlooked rule that “[m]ateriality is not limited to prior art but embraces any information that a reasonable examiner would be substantially likely to consider important in deciding whether to allow an application to issue as a patent.”35 The Federal Circuit noted that the ‘011 Patent and ‘277 Reissue Patent specifically recommended using both TMS and MOM hydroxy-protecting groups in the process of making taxol, but that the Article taught that using the TMS group was unstable and that the MOM group could not be removed after the process.36 Because of this apparent discrepancy, the Federal Circuit agreed with the District Court that “a reasonable Examiner would have wanted to know whether the unsuccessful use of MOM and TMS discussed in the [Article] affected the ability of a person of ordinary skill in the art to practice the invention, which specifically taught the use of MOM and TMS, without undue experimentation.”37 The Federal Circuit stated that a reasonable Examiner would have wanted to review the Article to determine whether or not the ‘011 Patent application satisfied the enablement requirement of 35 U.S.C. § 112, 1st paragraph.38 Because of this, regardless of the fact that the Article did not qualify as “prior art” under the provisions of 35 U.S.C. § 102, the Federal Circuit agreed that it was material to the claims of the ‘011 Patent.39 RPR further argued that because the Article was disclosed to the Examiner in searches performed by the Examiner, the Examiner “likely considered” the reference in the performance of his duties.40 However, the Federal Circuit held that absent any other evidence, the mere fact that the Article was listed in a search does not provide a presumption that the reference was considered by the Examiner.41 Therefore, because the Examiner did not obtain a copy of the Article, initial it on the search listing, or list it on a Form PTO-892, the Federal Circuit found that District Court did not err in finding that the Examiner did not likely consider the Article.42 RPR also argued that the Article was not material because the Article was disclosed during the prosecution of the ‘277 Reissue Patent application, and yet the ‘277 Reissue Patent was still allowed to issue.43 In addressing this argument, the Federal Circuit acknowledged that the decision by the Examiner to allow the ‘277 Reissue Patent over the Article is probative regarding the materiality analysis of the reference.44 However, the Federal Circuit also noted that this is not dispositive of the materiality issue. A reference must still be analyzed for materiality even where an examiner deems patent claims patentable over a cited reference.45 In finding that the Article was material, the Federal Circuit applied the standard set forth in Molins PLC v. Textron, Inc.,46 which stated that: [t]he standard to be applied in determining whether a reference is "material" is not whether the particular examiner of the application at issue considered the reference to be important; rather, it is that of a "reasonable examiner." Nor is a reference immaterial simply because the claims are eventually deemed by an examiner to be patentable thereover.47 Applying the Molins standard, the Federal Circuit found that even though the Article was disclosed to the USPTO during the prosecution of the ‘277 Reissue Patent application, the Article was not cited when it “should have been.”48 B. Intent The Federal Circuit also found that the District Court did not err in finding that RPR had an intent to mislead the USPTO by withholding the Article during the prosecution of the ‘011 Patent.49 In agreeing with the District Court’s finding on intent, the Federal Circuit focused on a number of key findings by the District Court50 and stated that “where withheld information is material and the patentee knew or should have know of that materiality, he or she can expect to have great difficulty in establishing subjective good faith sufficient to overcome an inference of intent to mislead.”51 The Federal Circuit stated that RPR’s French patent agent knowing the significance of the Article in combination with the finding that the French patent agent knew of the duty of disclosure is sufficient to establish intent.52 I. Discussion The Federal Circuit’s Bristol-Myers decision has provided patent applicants and patent practitioners with a number of valuable, yet often-overlooked, lessons that can be used to avoid allegations of inequitable conduct before the USPTO during litigation. The first and perhaps most often overlooked lesson from Bristol-Myers is that a reference or disclosure need not qualify as prior art under 35 U.S.C. § 102 to be considered a material reference under 37 C.F.R. § 1.56.53 This is not a new pronouncement by the Federal Circuit,54 but comes from a long line of cases that have held that the materiality question does not end after a prior art analysis.55 In fact, 37 C.F.R. § 1.56 makes it clear that “[e]ach individual associated with the filing and prosecution of a patent application has a duty of candor and good faith in dealing with the [USPTO], which includes a duty to disclose to the [USPTO] all information known to that individual to material patentability as defined in [37 C.F.R. § 1.56].”56 However, even though the law and the rules are clear on this subject, these laws and rules are frequently overlooked by practitioners and applicants who base their materiality determination only on a 35 U.S.C. § 102 prior art analysis.57 In view of the importance of an applicant’s duty of candor when before the USPTO, it bears repeating that “[m]ateriality is not limited to prior art but embraces any information that a reasonable examiner would be substantially likely to consider important in deciding whether to allow an application issue as a patent.”58 Thus, all information that a reasonable examiner would wish to have prior to allowing a patent to issue should be disclosed, including, but not limited to, information regarding best mode, enablement, written description, inventorship, and priority.59, 60 To end a materiality analysis after a simple determination under 35 U.S.C. § 102 invites a later assertion of inequitable conduct that can be easily avoided by disclosing the reference. A second lesson is that the filing of a reissue application will not cure previous inequitable conduct that occurred during the prosecution of the original patent.61 In the present case, the Article was filed in an information disclosure statement during the prosecution of the ‘277 Reissue Patent application. However, the Federal Circuit indicated that because the inequitable conduct occurred during the prosecution of the ‘011 Patent (the original patent), the issue is not that the Article was cited but that the Article was “not cited when [it] should have been.”62 A third, and equally important, lesson to practitioners and applicants to be taken from Bristol-Myers is that the mere fact that an Examiner may be aware of a reference is not sufficient to establish that the Examiner considered the reference. Essentially, if the Examiner does not affirmatively indicate that a reference was considered, e.g., by indicating its consideration on a Form PTO-892, it cannot be assumed that the Examiner considered or reviewed the reference. In Bristol-Myers, the Article was identified to the Examiner in searches initiated by the Examiner in the prosecution of the ‘011 Patent and the ‘277 Patent.63 However, the Examiner never initialed the search reports indicating that the Article was considered, the Examiner did not cite the reference on a Form PTO-892, nor was the Article found in the file history of the ‘011 Patent.64 Therefore, the Federal Circuit rejected RPR’s arguments that, in performing his duties, the Examiner “likely” considered the reference. The mere fact that the Examiner may have been exposed to a reference through a search does not create a presumption that the Examiner considered or reviewed the reference.65 Even if an applicant or practitioner believes that an Examiner has reviewed or considered a reference, without an affirmative indication within the record of such consideration, it will not be presumed that the Examiner has reviewed the reference, and the patentee will not be able to avoid assertions of inequitable conduct based on the argument that the Examiner likely considered the reference. II. Conclusion In Bristol-Myers, the Federal Circuit has provided applicants and practitioners with an important reminder of the pitfalls involved in performing a perfunctory materiality analysis with regard to a reference. Such an oversight can have a dramatic and far-reaching affect. To avoid later assertions of inequitable conduct, applicants and practitioners should err on the side of disclosure.66 1 2 3 Mr. Wikberg is an Associate at in the Washington, DC office of SUGHRUE MION, PLLC. Bristol-Myers Squibb Co. v. Rhone-Poulenc Rorer, Inc., 326 F.3d 1226 (Fed. Cir. 2003). The “duty of disclosure” arises under 37 C.F.R. § 1.56, which states, in part, that “[e]ach individual associated with the filing and prosecution of a patent application has a duty of candor and good faith in dealing with the [USPTO], which includes a duty to disclose to the [USPTO] all information known to that individual to be material to patentability as defined in this section.” 37 C.F.R. § 1.56(a) (2002). “Information is material to patentability when it is not cumulative to information already of record or being made of record in the application, and (1) [i]t establishes, by itself or in combination with other information, a prima facie case of unpatentability of a claim; or (2) [i]t refutes, or is inconsistent with, a position the applicant takes in: (i) [o]pposing an argument of unpatentabilty relied on by the [USPTO], or (ii) asserting an argument of patentability.” 37 C.F.R. § 1.56(b) (2002). Bristol-Myers Squibb Co., 326 F.3d at 1229-30. Id. Id. Id. 4 5 6 7 8 Id. On about November 3, 1987, the inventors submitted the Draft Article to RPR’s French patent agent, and the article was eventually published in the Journal of the American Chemical Society on August 17, 1988. Id. Id. (emphasis by Court omitted). 10-DAB refers to 10-deacetylbaccatin III, which the patent claims use in the creation of taxol. As a further note, the phrase “under unique reaction conditions” was changed to “under specially developed reaction conditions, as described below” in the published article. Id. Id. (quoting the Draft Article which indicated that (1) “A methoxymethyl [(“MOM”)] protecting group at C-2’ could not be removed following esterification”, (2) “The trimethylsilyl [(“TMS”)] 10 9 group could also be selectively introduced at C-7, but it proved unstable to the subsequent esterification conditions”, and (3) “The tert-butyldimethylsilyl [(“TBDMS”)] group could not be cleanly introduced” at C-7”). 11 12 13 Id. Id.. Id. at 1231. At least some of the claims in the draft application claimed the protecting groups which the inventors listed as problematic or undesirable in the Article. Id. 14 15 16 17 18 19 20 Id. Id. Id. Id. Id. Id. Id. at 1232. The copy of the article provided to the U.S. patent attorney had a footnote circled. Id. The footnote was one which indicated that one of the disclosed protecting groups had an undesirable attribute, in that it could not be removed after esterification. Id. 21 22 23 24 25 26 27 28 29 30 31 32 33 Id. Id. Id. Id. at 1232-33. Id. Id. at 1233. Id. Id. Id. Id. Id. Id. A finding of inequitable conduct renders the entire patent unenforceable. See, e.g., Zenith Electronics Corp. v. Exzec, Inc., 182 F.3d 1340, 134 (Fed. Cir. 1999). Bristol-Myers Squibb Co., 326 F.3d at 1242. 34 35 Id. at 1234, quoting GFI, Inc. v. Franklin Corp., 265 F.3d 1268, 1274 (Fed. Cir. 2001) (emphasis in original). 36 Bristol-Myers Squibb Co., 326 F.3d at 1234-35. 37 38 Id. at 1235. 35 U.S.C. § 112, 1st paragraph states: “The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor of carrying out his invention.” (Emphasis added). Bristol-Myers Squibb Co., 326 F.3d at 1235. In rejecting RPR’s arguments that the Article was not material to the ‘011 Patent, the Federal Circuit (1) upheld the District Court’s determination that the Examiner did not review the Article even though it was listed on the Examiner’s search report; (2) the District Court did not clearly err in finding the Article material even though it was disclosed in the ‘277 Reissue Patent application and the claims were not rejected in view of the Article; and (3) that “the issue of whether a reference would be considered important by a reasonable examiner in determining whether a patent application is allowable, including whether the invention is enabled, is a separate issue from whether the invention is actually enabled.” Id. at 1237-38. Id. at 1235. Id. at 1236. 39 40 41 42 Id. at 1236. In support of this, the Federal Circuit also noted MPEP § 715.05 (5th ed. Rev. 6 Oct. 1987) which stated that the reviewing Examiner “should indicate which publications [on a search printout] were reviewed by initialing and dating the copy of the printout in the left margin adjacent to each reviewed publication.” Id. Id. at 1236. Id. at 1237. Id. Molins PLC v. Textron, Inc., 48 F.3d 1172 (Fed. Cir. 1995). Id. at 1179. 43 44 45 46 47 48 Bristol-Myers Squibb Co., 326 F.3d at 1237. It is noted that during the District Court proceedings, Bristol-Myers filed a summary judgment motion stating that the patents were invalid for lack of enablement, which was denied by the District Court. RPR argued that because Bristol-Myers motion was denied, the patents were properly enabled, and thus the Article is not material. Stated differently, RPR argued that because the patents were enabled, an alleged non-enabling reference is immaterial. The Federal Circuit disagreed stating that “[t]he issue of whether a reference would be considered important by a reasonable examiner in determining whether a patent application is allowable, including whether the invention is enabled, is a separate issue from whether the invention is actually enabled.” Id. 49 50 Id. at 1240. Id. at 1239 (focusing on the findings of the District Court that (1) RPR (through its agent) intentionally wrote the ‘011 Patent broader than the Draft Article suggested; (2) RPR was aware of the Article at the time the application was drafted and at the time the application was submitted to the U.S. attorney for filing; (3) RPR was aware of the USPTO’s duty of disclosure; and (4) RPR’s justifications for not disclosing the Article “were insufficient grounds for not supplying it to the PTO Examiner and were not credible”). Id., citing Akron Polymer Container Corp. v. Exxel Container, Inc., 148 F.3d 1380, 1384 (Fed. Cir. 1998); GFI, Inc. v. Franklin Corp., 265 F.3d 1268, 1275 (Fed. Cir. 2001). 52 51 Bristol-Myers Squibb Co., 326 F.3d at 1240. Further, the Federal Circuit agreed with the District Court that RPR’s arguments that the omission was made in good faith lacked merit. Id. at 1241. Id. at 1234 (finding that the Article was material to whether or not the ‘011 Patent enabled one of ordinary skill in the art to make and use the claimed invention without undue experimentation under 35 U.S.C. § 112, 1st paragraph). 54 53 But see Northern Telecom, Inc. v. Datapoint Corp., 908 F.2d 931, 940 (Fed. Cir. 1990) (holding that to meet the materiality requirement, a reference must necessarily be prior art). 55 See e.g. Critikon, Inc. v. Becton Dickinson Vascular Access, Inc., 120 F.3d 1253 (Fed. Cir. 1997) (indicating that a “patent applicant’s duty to disclose is not limited to disclosing prior art.”); PerSeptive Biosystems, Inc. v. Pharmacia Biotech, Inc., 225 F.3d 1315 (Fed. Cir. 2000) (stating that material misrepresentations regarding inventorship would render a patent unenforceable due to inequitable conduct); and Dana Corp. v. NOK, Inc., 882 F.2d 505 (Fed. Cir. 1989) (finding that information related to whether or not the patent disclosed the best mode of the invention was material). 37 C.F.R. § 1.56 (2002) (emphasis added). 56 57 A clear example of this is found in this case, where the second U.S. patent attorney employed by RPR indicated in a letter to RPR that the Article would not affect the ‘011 Patent because the August 1988 publication of this Article was less than one year prior the filing of the ‘011 Patent application. Bristol-Myers Squibb Co., 326 F.3d at 1232. The U.S. patent attorney provided no discussion or analysis regarding the Articles’ implications or potential effect regarding “enablement” or any other issue. Id. See id. at 1234, quoting GFI, Inc. v. Franklin Corp., 265 F.3d 1268, 1274 (Fed. Cir. 2001) (emphasis in original). 59 60 58 See, e.g., Li Second Family Ltd. Partnership v. Toshiba Corp., 231 F.3d 1373 (Fed. Cir. 2000). Bristol-Myers Squibb Co., 326 F.3d at 1241. See also, e.g., Li Second Family Ltd. Partnership v. Toshiba Corp., 231 F.3d 1373 (Fed. Cir. 2000). Further, it is worth noting that, although not expressly stated in Bristol-Myers, the Federal Circuit has previously held that it “is well settled that, in the [ ] case of inequitable conduct during the prosecution of the original application, reissue is not available to obtain new claims and thereby rehabilitate the patent” Id. at 1237, quoting Molins PLC v. Textron, Inc., 48 F.3d 1172, 1182 (Fed. Cir. 1995). 62 63 64 65 61 Bristol-Myers Squibb Co., 326 F.3d at 1237, quoting Molins PLC, 48 F.3d at 1182. See Bristol-Myers Squibb Co, 326 F.3d at 1231-32. Id. at 1236-1237. See also FMC Corp. v. Hennessy Industries, Inc., 836 F.2d 521 (Fed. Cir. 1987) (finding that a district court erred in finding no inequitable conduct because the prosecution history provided evidence that the Examiner searched the class and subclass which contained the withheld reference). See LaBounty Mfg., Inc. v. United States Int’l Trade Comm’n, 958 F.2d 1066, 1076 (Fed. Cir. 1992) (It is axiomatic that “close cases should be resolved by disclosure, not unilaterally by the 66 applicant.”); LNP Engineering Plastics, Inc. v. Miller Waste Mills, Inc., 275 F.3d 1347, 1361 (Fed. Cir. 2001) (stating that applicants should error on the side of disclosure).