Attorney Published Article

Practice Points: Lessons Learned After Dow Slammed By Section 112 Law Change Under Nautilus

February 5, 2016

State Bar of Texas Intellectual Property Section Newsletter

The Federal Circuit recently reversed a $30 million damages award to Dow Chemical Co. in a patent infringement suit with Nova Chemicals Corp. See Dow Chem. Co. v. Nova Chems. Corp. (Can.), No. 2014-1462, 2015 U.S. App. LEXIS 15191 (Fed. Cir. Aug. 28, 2015). On appeal, Nova argued that the claims at issue in the Dow patents were invalid for indefiniteness and the court concurred, determining that under the new Nautilus standard (the decision under appeal was issued pre-Nautilus under the “insolubly ambiguous standard”), the claims must provide the public notice as to what is claimed “with reasonable certainty.” See id. at 29–30 citing Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120, 2124 (2014).

The claim term at issue related to the “slope of strain hardening,” which was utilized to calculate a slope of strain hardening coefficient (SHC) recited in the claims. The Specification stated that the slope of strain hardening was determined from a tensile curve plot. See id. at 22–23. The Specification further indicated that the tensile curve plot showed three phases of behavior, including a strain hardening region, utilized to determine the slope of strain hardening. See id. at 23–24.

Nova argued that the patent failed “to teach with reasonable certainty where and how the ‘slope of strain hardening’ should be measured.” Id. at 24-25. The Specification stated that “FIG. 1 shows the various stages of the stress/strain curve used to calculate the slope of strain hardening.” Id. However, the Specification did not contain the referenced Figure 1. See id. In addition, Dow admitted that three different methods existed to determine the maximum slope and all typically occur at the same place—at the end of the curve. See id. at 25–26.

Thus, the ultimate question was when multiple methods exist to determine a physical property or value, must one of those methods be identified in the Specification (or in prosecution history). Prior to Nautilus, a claim was not indefinite if someone skilled in the art could arrive at a method and practice that method. See id. at 28–29 (citing Exxon Research & Engineering Co. v. United States, 265 F.3d 1371, 1379 (Fed. Cir. 2001)). Relying on this pre-Nautilus standard, the Court determined that “the mere fact that the slope may be measured in more than one way does not make the claims of the patent invalid.” Id. at 29 (discussing Dow Chem. Co. v. Nova Chems. Corp. (Can.), 458 Fed. App. 910, 920 (Fed. Cir. 2012)). This was because Dow’s expert, Dr. Hsiao, a person skilled in the art, had developed a method for measuring maximum slope. See id. In other words, although Nova showed that other regions in the slope were capable of measurement, such measurements did not preclude one of ordinary skill in the art identifying that the maximum slope leads to the most appropriate reading of the strain hardening slope. Nor was it too difficult for one or ordinary skill in the art to make a few measurements and determine, based on the result, what the scope of the invention is. See Dow Chem. Co. v. Nova Chems. Corp.(Can.), 458 Fed. App’x 910, 920 (Fed. Cir. 2012).

However, the Court, applying the post-Nautilus standard, found that ambiguity in which method to use, compounded by the is-sue that the different methods could provide a different result, rendered “slope of strain hardening” indefinite. See Dow Chem. Co. v. Nova Chems. Corp. (Can.), No. 2014-1462, 2015 U.S. App. LEXIS 15191 (Fed. Cir. Aug. 28, 2015) at 20, citing Teva Pharms. USA, Inc. v. Sandoz, Inc., 789 F.3d 1335, 1344–45 (Fed. Cir. 2015) (stating that one “must disclose a single known approach or establish that, where multiple known approaches exist, a person having ordinary skill in the art would know which approach to select”). Under Nautilus, “[t]he claims, when read in light of the specification and the prosecution history, must provide objective boundaries for those of skill in the art.” See id. at 20, citing Interval Licensing LLC v. AOL, Inc., 766 F.3d 1364, 1371 (Fed. Cir. 2014). Such a determination is in keeping with the decision in Teva (where molecular weight could be measured three different ways and each method would yield different results), which held that “the existence of multiple methods leading to different results without guidance in the patent or the prosecution history as to which method should be used renders the claims indefinite.”

So, how does the patent practitioner avoid indefiniteness? The easiest way to avoid such ambiguity is to define all properties by recognized ASTM methods. However, not all physical properties can be measured by a published ASTM method. In such cases, clearly identify each and every step for measurement and when multiple testing methods exist, clearly and concisely identify only a single measurement method in the Specification.

Furthermore, how does the patent practitioner draft a specification to anticipate potential changes in law? The Dow v. Nova case provided a rare example of the application of the “intervening change in the law” exception in the patent infringement context, which ultimately was the root cause of a divergence between the respective Dow holdings regarding liability. The “intervening change in the law” exception applies whether the change in law occurs while the case is before the district court or while the case is on appeal. See id. at 16. The Court stated that three conditions must be satisfied to reopen a previous decision under the intervening change in the law exception for both law of the case and issue preclusion:

• the governing law must have been altered;
• the decision sought to be reopened must have applied the old law; and
• the change in law must compel a different result under the facts of the particular case.

See id. at 17–18

The Court held that each of these requirements was satisfied in the Dow v. Nova case. See id. at 18. Specifically, the Court stated that each of these requirements was met because Nautilus changed the law of indefiniteness; the earlier decision applied pre-Nautilus law; and as discussed in the section above, the Court’s earlier decision would have been different under the post-Nautilus standard. See id. at 18–22.

Thus, it is clear that patent law is subject to potential changes in law. However, the best protection against changes in law is to draft a thorough and precise Specification within the bounds of the information that is presented. Specifically, pay close attention to definitions, testing methods, measurement methods, and ranges to identify each and every embodiment that will cover the inventive subject matter.

Experienced patent practitioners may believe that such suggestions are obvious even pre-Nautilus. However, an important take-away from the Dow v. Nova case is that technical expertise can cloud the need to define particular aspects of an invention. For example, while the term “slope of strain hardening” likely was clear to those drafting the Specification at the time, when removed from the specific context of the Dow environment, that same term was not so clear. Thus, it may be helpful to have a colleague, outside the technological field of the subject matter of an application, review your Specification to identify potentially ambiguous terms that could benefit from further definitions, including measurement or testing methods.

This article was first published in IPFrontline on November 16, 2015.