Abbvie Deutschland Gmbh & Co. v. Janssen Biotech, Inc.

Citations: 759 F.3d 1285; 111 U.S.P.Q. 2d (BNA) 1780; 2014 U.S. App. LEXIS 12372; 2014 WL 2937477Docket: 13-1338

Court: Court of Appeals for the Federal Circuit; July 1, 2014; Federal Appellate Court

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AbbVie Deutschland GmbH Co. KG, AbbVie Bioresearch Center, Inc., and AbbVie Biotechnology Ltd. (collectively “AbbVie”) appealed final judgments from the U.S. District Court for the District of Massachusetts regarding patent infringement and interference actions against Janssen Biotech, Inc. and Centocor Biologics, LLC (collectively “Centocor”). In the infringement action, AbbVie accused Centocor of infringing specific claims of U.S. Patent 6,914,128 and U.S. Patent 7,504,485. In the interference action, Centocor sought judicial review of a PTO decision that awarded priority to AbbVie for claims in the '128 patent, which the PTO found not invalid for obviousness.

Following a trial, the jury ruled that all asserted claims were invalid due to issues of written description, enablement, and obviousness. The district court denied AbbVie’s post-trial motions for judgment as a matter of law (JMOL) and for a new trial, ultimately entering judgments of invalidity in both actions. AbbVie’s consolidated appeals challenge the denial of its summary judgment motion regarding Centocor's ability to raise invalidity defenses, as well as its JMOL motions on written description and enablement, and the new trial motion based on alleged evidentiary and jury instruction errors.

In Abbott GmbH. Co. v. Centocor Ortho Biotech, Inc., the court ruled that the decision from the Patent Trial and Appeal Board was not final due to the pending interference action under § 146, thus precluding its use for collateral estoppel. The court affirmed the jury's verdict that the claims lacked adequate written description under 35 U.S.C. § 112 and found no reversible errors in the evidentiary rulings or jury instructions that would necessitate a new trial. As all asserted claims were invalid for failing to meet the written description requirement, the court did not address AbbVie's arguments regarding enablement or procedural challenges related to obviousness judgments, affirming the invalidity in both infringement and interference actions.

The case involves antibodies designed to treat diseases, specifically targeting human interleukin 12 (IL-12), a protein linked to conditions like psoriasis and rheumatoid arthritis. AbbVie holds patents on fully human antibodies that neutralize IL-12, developed through methods such as phage display and transgenic mice. The process began with the identification of an antibody fragment named “Joe-9,” which was later enhanced through mutations to create “Y61,” ultimately leading to a variant “J695” that demonstrated improved binding and neutralizing activity against IL-12.

The ’128 and ’485 patents, both originating from a 1999 provisional application, describe approximately 300 IL-12 binding antibodies derived from the lead antibody Joe-9, characterized by VH3 type heavy chains and Lambda type light chains. These antibodies exhibit at least 90% amino acid sequence similarity in their variable regions. The patents assert that high amino acid sequence identity within the VH3 family allows for the generation of IL-12 binding antibodies from other VH3 and Lambda family members. However, they do not disclose any IL-12 antibodies with heavy chains outside the VH3 family or light chains outside the Lambda family. 

The claims, particularly claim 29 of the ’128 patent, focus on the functional attributes of the antibodies, including specific koff rate constants for binding to human IL-12. Centocor developed Stelara, a human IL-12 neutralizing antibody with VH5 type heavy chains and Kappa type light chains, which has about 50% sequence similarity to the Joe-9 antibodies and was FDA-approved in 2009. Centocor filed a ’994 application for IL-12 antibodies, leading to an interference with the ’128 patent. 

Centocor initially aimed to challenge the validity of the ’128 claims but ultimately filed motions only on the grounds of obviousness. On August 6, 2009, the Board ruled in favor of AbbVie, affirming the validity of the ’128 claims. Following this, AbbVie filed an infringement lawsuit against Centocor in Massachusetts, while Centocor sought judicial review and a declaratory judgment regarding the ’128 and ’485 patents in D.C., which were later consolidated in Massachusetts with AbbVie’s infringement action.

AbbVie sought summary judgment to prevent Centocor from contesting the validity of the ’128 patent, asserting that Centocor was collaterally estopped due to its failure to invalidate the patent claims during a PTO interference proceeding. The district court denied this motion, indicating that the Board's decisions were not final due to an ongoing § 146 action, and prioritized the infringement action to safeguard Centocor’s right to a jury trial. After claim construction, the court ruled that Centocor infringed claims 29, 32, and 64 of the ’128 patent and claim 11 of the ’485 patent, with both parties stipulating to the infringement of claim 30. AbbVie limited its assertions to these five claims, while Centocor agreed not to contest the PTO's nonobviousness ruling on other claims involved in the interference.

During the jury trial, the court excluded evidence from the PTO interference proceeding under Federal Rule of Evidence 403 but allowed AbbVie’s expert, Dr. Marks, to testify that the PTO had affirmed the claims' compliance with written description, enablement, and obviousness standards. However, Dr. Marks was restricted from detailing the PTO's reasoning. Centocor advanced four invalidity defenses based on written description, enablement, obviousness, and anticipation by prior invention, presenting evidence that the antibodies in AbbVie’s patents were not representative of the broader claimed genus, particularly regarding Stelara.

The jury was instructed that Centocor bore the burden of proving invalidity by clear and convincing evidence and was informed that evidence not considered by the PTO could affect Centocor's burden if deemed material. The jury ultimately found that while AbbVie’s claims were not anticipated, they were invalid due to inadequate written description, lack of enablement, and obviousness. AbbVie’s motions for judgment as a matter of law (JMOL) and for a new trial were denied. The court entered judgment based on the jury's invalidity verdict, which also influenced the § 146 action, leading to the reversal of the Board's nonobviousness ruling on claims 29, 30, and 32, and claim 64 as depending from claim 29. AbbVie appealed, with jurisdiction established under 28 U.S.C. § 1295(a)(1) and (a)(4)(C).

In patent appeals, the applicable law is determined by the regional circuit of the district court, with the First Circuit's law being relevant in this case. The review process involves the grant or denial of summary judgment motions, JMOL motions, new trial motions, evidentiary rulings, and jury instructions following the First Circuit’s law. General principles of collateral estoppel are also reviewed under the First Circuit's law, but unique patent law issues are governed by Federal Circuit precedents.

For collateral estoppel, the First Circuit applies a de novo review to summary judgment denials. To invoke collateral estoppel, a party must prove: (1) the same issue was involved in both actions, (2) the issue was actually litigated, (3) it was resolved by a valid final judgment, and (4) the determination was essential to that judgment. AbbVie contends that Centocor's invalidity defenses regarding the ’128 patent should not have been presented to a jury due to the preclusive effect of the Board's prior judgment. AbbVie argues that the § 146 action, which allows Centocor to present new evidence, is more akin to an appeal and does not diminish the Board's judgment's finality.

Conversely, Centocor asserts that the Board's decision lacks finality due to the pending § 146 action, where it presented new evidence. It argues that restrictions during the interference proceedings limited its ability to fully litigate. Centocor also claims AbbVie waived its collateral estoppel argument by not renewing it in a post-verdict JMOL motion. The court agrees with Centocor, concluding that the Board's judgment was not a final judgment for collateral estoppel purposes because the § 146 action was ongoing. Consequently, the court does not address whether AbbVie waived its argument.

Section 146 of the patent statute allows a dissatisfied party to seek judicial review of a Board decision by initiating a civil action within sixty days. This provision enables the introduction of new evidence that was not available during the PTO proceedings, allowing the district court to make de novo factual findings based on this new evidence while considering the original agency record. The purpose of § 146 is to apply federal litigation procedures to contested issues in patent interference cases, which are derivative of the PTO proceedings. Additionally, parties dissatisfied with a Board decision can alternatively appeal directly to the court under 35 U.S.C. § 141.

A direct appeal under § 141 relies exclusively on the agency record and follows the standard set by the Administrative Procedure Act, resembling a traditional district court appeal. The statute mandates that if an adverse party files a notice within twenty days of the appeal, they may elect to proceed under § 146, allowing for the reopening and supplementation of the factual record at the district court. This process ensures that the factual record remains open for contested issues at the Patent and Trademark Office (PTO), enabling a district court to make a de novo determination of facts with new evidence. Consequently, a Board decision reviewed under § 146 is not considered a binding final judgment, thus permitting a losing party to litigate related issues in parallel proceedings. Centocor initiated its § 146 action within the required timeframe, allowing it to present new evidence regarding priority and obviousness, and the Board's decisions lacked finality for collateral estoppel purposes. Therefore, Centocor was not collaterally estopped from asserting invalidity defenses in the infringement action.

The First Circuit reviews motions for judgment as a matter of law (JMOL) de novo, determining if a reasonable jury could find in favor of the party on the issue. A patent claim's written description adequacy is a factual question, with jury determinations reviewed for substantial evidence. Patents are presumed valid, requiring clear and convincing evidence to overcome this presumption. AbbVie contends that its asserted claims pertain to a limited genus of rare antibodies and that its patents adequately describe these antibodies, covering the claimed koff rate. AbbVie argues that it disclosed the amino acid sequences of all relevant species except Stelara and was not required to describe individual infringing products. In contrast, Centocor asserts that the jury's invalidity verdict for inadequate written description is supported by substantial evidence, claiming AbbVie’s disclosures are limited to structurally similar antibodies derived from Joe-9, while its claims cover antibodies with varied structures, including Stelara.

AbbVie’s argument that structural differences are irrelevant is rejected by Centocor, which asserts that the functional requirements of the claims, specifically the koff rate, are structurally dependent. Centocor argues that AbbVie’s evidence regarding representative species is not applicable. The court agrees with Centocor, affirming that substantial evidence supports the jury's verdict deeming the claims invalid due to inadequate written description. The written description requirement is a long-standing aspect of patent law, mandating that patent applicants fully describe their inventions and how to utilize them, distinct from the enablement requirement. The court emphasizes that the requirement ensures public knowledge of the invention and prevents overreaching claims beyond the inventor’s actual contributions. It posits that possession of an invention is demonstrated through disclosure in the patent specification, which must align with the claims. In cases where a genus is claimed but only a part is described, as in this case, the jury found insufficient disclosure, a finding the court supports. Factors for assessing disclosure adequacy include existing knowledge, prior art, technological maturity, and predictability. The claimed invention pertains to a group of fully human antibodies characterized by their high affinity and neutralizing activity against human IL-12.

AbbVie’s expert acknowledged that the ’128 and ’485 patents lack structural features common to the claimed genus members. The key issue is whether the patents adequately describe representative species to support the entire genus. The size of the genus and the species described in the patent are crucial factors. If the genus is small or the specification includes species representative of the entire genus, the requirement may be satisfied. However, if the disclosed species only represent a small portion of the genus, this does not demonstrate sufficient invention or possession of the entire genus. 

The analogy of a plot of land is employed to illustrate this point: merely outlining a genus does not equate to a sufficient description. A patent must show true invention of the genus by providing enough representative species to encompass its breadth, rather than merely outlining a research plan that allows others to explore it. Evidence presented at trial indicated that AbbVie’s patents describe only one type of structurally similar antibodies, none of which are representative of the full genus. The antibodies detailed in the patents are derived from Joe-9 and share significant structural similarities, with over 90% sequence similarity among them. However, the patents fail to describe or imply the existence of fully human IL-12 antibodies with different heavy and light chains. 

In contrast, Centocor’s Stelara, which falls within the claimed genus, significantly differs from the Joe-9 antibodies, featuring VH5 type heavy chains and Kappa type light chains, with only 50% sequence similarity to the Joe-9 antibodies, demonstrating that AbbVie’s patents do not adequately describe the broader genus.

Centocor's expert indicated that antibodies with 80% sequence similarity to J695 could bind to entirely different antigens, highlighting significant structural differences between Stelara and Joe-9 antibodies and the unpredictability in the field. Evidence of differences included variations in CDR length and epitope binding sites. The asserted claims encompass both Joe-9 antibodies and Stelara, indicating that the claimed genus includes structurally diverse antibodies. However, the patents in question only describe species of structurally similar antibodies derived from Joe-9, which, despite their quantity, do not qualitatively represent the diversity encompassed by the genus. There are no definitive rules regarding the number of species required to describe a genus, as this varies with each invention and field advancements. While AbbVie’s patents do not need to describe Stelara in precise terms, they must identify some species that are structurally similar to it. The record lacks evidence of any described antibody being structurally similar to Stelara or that a skilled artisan could predictably modify the described antibodies to create antibodies like Stelara. AbbVie contends that structural differences are irrelevant and misapplies koff rates to demonstrate representativeness, despite koff rates being an outcome rather than a method. The claims are for new fully human antibodies with specific IL-12 binding characteristics, where the antibody structure is crucial for its binding ability. To validate its claims, AbbVie must adequately describe representative antibodies reflecting the structural diversity of the claimed genus. Simply naming a well-known material without detailing its composition fails to meet the description requirement. Functionally defined genus claims are susceptible to invalidity challenges for lack of written description support, especially in unpredictable fields where establishing a link between structure and function is difficult.

The written description requirement's level of detail is contingent on the claims' nature and scope, as well as the technology's complexity. Functionally defined claims can satisfy this requirement if a reasonable structure-function correlation is established, either through the inventor's specification or the art known at the filing date. However, in this case, AbbVie failed to demonstrate such a correlation, relying instead on a trial and error method to enhance IL-12 binding affinity, without providing common structural features in the claimed antibodies. The patents asserted claims over all fully human IL-12 antibodies achieving high binding affinity and neutralizing activity, including diverse antibodies like Stelara, without representative examples to substantiate the claims' breadth. Consequently, the jury's verdict of invalidity due to insufficient written description is supported by substantial evidence, leading to the affirmation of the district court's denial of JMOL on this issue. The First Circuit reviews new trial motions for abuse of discretion, examining evidentiary rulings and jury instructions for potential error and assessing whether such errors could have influenced the jury's deliberation. AbbVie contends that the exclusion of the interference file history allowed Centocor to relitigate invalidity without constraints.

AbbVie claims it was unjustly prohibited from using file history to argue that much of Centocor’s case was redundant, particularly regarding phage display prior art relevant to the obviousness determination. AbbVie contends that the district court wrongly excluded expert testimony about the PTO's reasoning on written description, enablement, and obviousness during ex parte prosecution. Centocor counters that the district court did not abuse its discretion in excluding certain evidence to prevent delays and confusion for the jury, noting that AbbVie did not accept Centocor's proposal to stipulate a list of art references considered by the PTO. Centocor asserts that the ex parte prosecution history was admitted into evidence, yet AbbVie did not provide witness testimony on the prior art considered by the PTO and failed to demonstrate that its rights were significantly impacted to warrant a new trial.

The court found sufficient evidence to support the jury's verdict of invalidity due to lack of written description support, necessitating examination of whether the evidentiary rulings affected AbbVie’s substantive rights regarding that verdict. It concluded that evidence concerning obviousness had little relevance to the written description issue. The Board addressed only obviousness and anticipation by prior invention, and substantive motions on written description were not filed during the interference proceeding, which did not prevent Centocor from raising invalidity defenses in the infringement action. The court found no error in excluding evidence related to Centocor’s interference participation or Dr. Marks' detailed testimony about PTO reasoning, even though he was allowed to state that the PTO considered the written description issue and concluded it was met.

Ultimately, the court determined that the exclusions did not compromise the trial's integrity. AbbVie also argued that jury instructions exacerbated the prejudicial effect of the evidentiary rulings, suggesting that new information not considered by the PTO would aid Centocor in proving invalidity. AbbVie claimed the district court erred in concluding that the Supreme Court's ruling in Microsoft v. i4i overruled previous case law, but this assertion was deemed weak.

The court examined AbbVie’s claims regarding jury instructions related to the relevance of new information compared to what the Patent and Trademark Office (PTO) had considered. AbbVie argued that the jury should have been instructed to evaluate whether Centocor sufficiently demonstrated that new information was more relevant than that previously considered by the PTO. AbbVie also contended that the district court misinterpreted the term "materially new" from Microsoft v. i4i, using an incorrect "reasonable examiner" standard for materiality. Centocor countered that its jury instructions were aligned with Microsoft v. i4i and that it was not required to prove the new information's greater materiality, asserting that AbbVie could have made this comparison. Centocor noted that it informed the jury about information not considered by the PTO, such as the Meager article and J695/IL-12 crystal structure. The court ultimately determined that any potential errors in the jury instructions regarding written description did not constitute reversible error and that the absence of prejudice meant a new trial was unnecessary. The court referenced previous rulings emphasizing that the burden lies with the challenger to show that non-considered art is more relevant than cited art, especially in challenges based on anticipation or obviousness. Since the court affirmed the written description verdict, it did not need to address whether the district court's refusal to instruct on the relevance of non-considered art affected the jury's obviousness verdict or if Centocor failed to meet its burden regarding the Meager article.

The Supreme Court in Microsoft v. i4i emphasized that if the Patent and Trademark Office (PTO) lacks all material facts, its judgment may be less persuasive, potentially easing the challenger’s burden to prove patent invalidity by clear and convincing evidence. The Court noted that if evidence presented to the jury differs from what was evaluated by the PTO, the jury should consider this difference, particularly whether the evidence is "materially new." The district court refined "materially new" to mean "additional information [that] would have been 'material' to the PTO’s decision" and instructed the jury to assess whether the information would be significant to a reasonable patent examiner.

The jury was informed that if the additional information was not material or lacked significant weight, Centocor's burden would be more challenging to meet. The jury instruction effectively guided the jury in evaluating evidence regarding the written description issue, including the J695 crystal structure. Notably, even without the J695 information, substantial evidence supported the jury's verdict of invalidity due to inadequate written description. Centocor presented five categories of structural differences between Stelara and AbbVie’s patented Joe-9 antibodies, including sequence similarity and binding site differences.

The absence of the J695 crystal structure alone likely would not have changed the jury's invalidity verdict, indicating that the overall record did not show any reversible error in the verdict. The court concluded that Centocor was not collaterally estopped from asserting invalidity defenses and that substantial evidence justified the jury's finding of invalidity due to inadequate written description. The district court did not abuse its discretion in denying AbbVie’s motion for a new trial, leading to the affirmation of the district court's judgments in both the infringement and interference actions.

The United States Court of Appeals for the Federal Circuit affirmed the judgment of the lower court regarding patent invalidity in the case of AbbVie Deutschland GmbH. Co. v. Janssen Biotech, Inc. The court held that Centocor was not barred by collateral estoppel from asserting invalidity defenses despite a prior Board ruling on the non-obviousness of the relevant claims in the ’128 patent. The court agreed with the trial court's invalidation of the asserted claims in both the ’128 and ’485 patents, basing this on the trial court's finding of obviousness, which AbbVie did not contest.

AbbVie conceded that the validity hinged on whether the jury received proper instructions regarding the burdens of proof. The court noted that while AbbVie sought a new trial based on the obviousness judgment, it did not file for judgment as a matter of law (JMOL) on that point. The court clarified that the outcome of the case depends on whether any prejudicial errors were found in the jury instructions. If no errors were determined, the finding of obviousness would remain, rendering the patents invalid. Conversely, if errors were found, AbbVie would be entitled to a new trial on all validity issues.

The concurring opinion emphasized that the majority's analysis of the written description was not necessary for the case's outcome and that the court reviews jury instruction sufficiency de novo, only ordering a new trial if errors had a prejudicial impact on the outcome. AbbVie argued that the improperly structured jury instruction affected all invalidity verdicts, as it was the only instruction addressing Centocor's burden of proof, which was presented at the beginning of the jury instructions.

AbbVie contends that the jury instruction regarding the impact of previously unseen material on the Patent and Trademark Office (PTO) significantly affected the jury's assessment of all four validity defenses, particularly concerning the written description. AbbVie highlights that Centocor’s main argument was that the crystal structure of J695 constituted "additional information" that eased their burden of proof. Janssen acknowledges that the jury instruction in question applied equally to both the written description (112) and obviousness claims. During oral argument, Janssen's counsel confirmed that the instruction affected all grounds of invalidity. Both parties agree that evaluating AbbVie’s challenge to the jury instruction is crucial for addressing the alleged errors. The assessment indicates the jury instruction adequately guided the jury in weighing evidence relevant to both written description and obviousness. Consequently, the decision to affirm the lower court's judgment is supported, as AbbVie is not entitled to a new trial due to a legally erroneous jury instruction, leading to the conclusion that its patents are invalid based on the jury's finding of obviousness. The concurrence in the majority's outcome is stated, though with differing reasoning.