Enzo Biochem, Inc. v. Calgene, Inc., Defendant-Cross
Docket: 98-1438
Court: Court of Appeals for the Federal Circuit; September 24, 1999; Federal Appellate Court
Enzo Biochem, Inc. appeals a decision from the United States District Court for the District of Delaware, which invalidated certain claims of its U.S. Patents 5,190,931 and 5,208,149, ruling that Calgene, Inc.'s FLAVR SAVR tomato did not infringe these patents. Enzo also contests the denial of its post-trial evidentiary motions. Calgene cross-appeals the dismissal of its counterclaim seeking a declaratory judgment that Enzo's U.S. Patent 5,272,065 is invalid due to nonenablement, obviousness, and anticipation, as well as the determination that the case is not exceptional.
The Federal Circuit affirms the district court's conclusion that the claims of the '931 and '149 patents are invalid due to nonenablement, and thus does not consider the infringement issue. Additionally, the court finds that Calgene did not establish by clear and convincing evidence that Enzo's '065 patent is invalid and that the district court acted within its discretion regarding evidentiary matters. However, the court vacates and remands the case due to the district court's failure to address the issue of inequitable conduct prior to determining whether the case is exceptional.
The background details the significance of genetic antisense technology in controlling gene expression, explaining the roles of the coding (sense) and template (antisense) strands of DNA in protein synthesis.
RNA polymerase initiates gene expression by binding to a promoter site, unwinding DNA, and transcribing the template strand into messenger RNA (mRNA). The mRNA closely resembles the DNA coding strand but contains ribose instead of deoxyribose and uracil instead of thymine. A termination sequence signals the end of transcription, after which mRNA is translated into proteins in ribosomes. Antisense technology seeks to inhibit gene expression by blocking mRNA translation using DNA constructs that contain inverted gene sequences, leading to the production of messenger interfering complementary RNA (micRNA). This micRNA binds to native mRNA, preventing its translation and thereby blocking protein synthesis.
The '931, '149, and '065 patents, assigned to the Research Foundation of the State University of New York and exclusively licensed to Enzo, claim fundamental aspects of genetic antisense technology. They describe methods for regulating three genes in E. coli: lpp, ompC, and ompA. Despite limited disclosures, inventor Masayori Inouye generalized that this technology applies to any organism with genetic material, including prokaryotic and eukaryotic organisms as well as viruses.
The claims of the '931 patent encompass antisense constructs, methods for regulating gene expression, and cells containing these constructs, applicable to a wide range of organisms. Key claims include:
1. A cell with a non-native DNA construct that produces RNA regulating gene function, comprising a transcriptional promoter, a transcription termination segment, and an intervening DNA segment that generates a complementary ribonucleotide sequence regulating a specific gene.
2. A method for gene regulation in cells through the introduction of the aforementioned DNA construct.
3. A DNA construct that generates RNA to regulate gene function, with an inverted gene segment positioned between the promoter and termination segments.
The '149 patent's claims are similar, but focus on constructs coding for a "stable stem and loop structure with a negative G of formation." The '065 patent’s claims differ only slightly.
The accused product, Calgene's FLAVR SAVR tomato, utilizes antisense technology to inhibit the polygalacturonase (PG) gene, which is responsible for tomato ripening. Enzo sued Calgene for infringement of multiple claims from the '931 and '149 patents, while Calgene counterclaimed for a declaratory judgment asserting the patents' invalidity, unenforceability, and non-infringement, citing grounds such as lack of enablement, anticipation, and obviousness under U.S. patent law. Both parties sought attorney fees, arguing the case was exceptional.
Following a bench trial, the district court ruled that the FLAVR SAVR tomato did not infringe the '931 and '149 patents, either literally or under the doctrine of equivalents. The court also deemed the patent claims invalid due to a lack of enablement, as practicing antisense technology in cells other than E. coli required undue experimentation, referencing In re Wands. Consequently, the court did not address issues of obviousness, anticipation, or inequitable conduct. Both parties' requests for attorney fees were denied, as the case was not considered exceptional. The court did not consider Calgene's counterclaim regarding the invalidity and unenforceability of Enzo's '065 patent due to insufficient evidence presented. Additionally, Enzo's post-trial motions to reopen the record for new evidence were denied. Appeals by Enzo and Calgene were noted, with jurisdiction established under 28 U.S.C. 1295(a)(1).
The standards of review include a de novo assessment of whether undue experimentation would be required for enabling disclosure under 35 U.S.C. 112, 1, based on factual inquiries reviewed for clear error. For substantive patent law issues, the Federal Circuit applies its own law, while nonpatent issues are governed by the law of the relevant circuit. The district court's refusal to reopen the record for new evidence is reviewed for abuse of discretion. The determination of whether a case is exceptional for awarding attorney fees involves a two-step process: first, a factual determination of exceptional status reviewed for clear error, followed by a discretionary decision on fee awards.
Enzo argues against the application of the Wands enablement factors, claiming they pertain only to ex parte prosecution. Alternatively, Enzo contends that even if the Wands factors are applicable, the required experimentation for using the invention in other cell types is routine rather than undue.
Enzo argues that Calgene's evidence regarding the need for undue experimentation is irrelevant because it fails to connect this evidence to specific missing steps or defects in the patent specifications. Enzo asserts that Calgene did not demonstrate how differences between eukaryotes and prokaryotes impact the functionality of antisense in eukaryotes. Furthermore, Enzo claims the district court misjudged the level of skill in the art by not considering the specialized sub-fields relevant to the invention's embodiments. Enzo also points out that the district court overlooked significant evidence of enablement, particularly the findings from the Patent and Trademark Office and the European Patent Office affirming the claims' enablement.
In response, Calgene maintains that the Wands factors, which assess enablement, are applicable in inter partes litigation and that the district court's conclusion regarding the necessity of undue experimentation was appropriate. Calgene asserts that it is not required to specify missing elements in the patent to establish nonenablement, especially given the incomplete understanding of the biochemical mechanisms behind antisense technology. Calgene defends the district court's assessment of the skill level in the art, arguing that such skill does not necessitate expertise across all genes in various organisms. Additionally, Calgene argues that reported successes in antisense applications are not relevant to the enablement issue, while numerous failed attempts indicate that the specifications lack enablement and that undue experimentation was indeed required. Calgene contends that the EPO's decision should not be considered as evidence of enablement under U.S. law.
The legal foundation for the enablement requirement is outlined in 35 U.S.C. § 112, which mandates that a patent's specification must clearly describe the invention and its use to enable skilled individuals to practice it without undue experimentation. Enablement must be assessed as of the original patent application date, in this case, October 20, 1983. A patent can be compliant even if some routine experimentation is necessary, provided it does not amount to "undue" experimentation. The determination of whether experimentation is undue involves several factors, including the quantity of experimentation required, the guidance provided, the presence of working examples, the nature of the invention, the state of prior art, the skill level of practitioners in the field, the predictability of the art, and the breadth of the claims.
All factors need not be considered in enabling disclosure determinations, as established in Amgen, Inc. v. Chugai Pharm. Co. Ltd., emphasizing that the Wands factors serve as illustrative rather than mandatory. Enzo argues that the Wands factors are inapplicable in inter partes litigation due to the absence of prediction required in ex parte prosecution. However, the court disagrees, clarifying that enablement assessments in both contexts are retrospective, focusing on whether undue experimentation would have been necessary at the patent application's filing date. The Wands factors can thus be appropriately applied in both scenarios.
The district court determined that the claims in question are exceedingly broad, covering an extensive range of cell types, particularly noting that, apart from one claim, they encompass antisense technology in all cell types. The court found no clear error in this assessment. It also concluded that antisense technology is highly unpredictable, supported by substantial evidence, including expert testimony and literature indicating the challenges and ambiguities associated with antisense applications. The court affirmed its findings regarding both the broadness of the claims and the unpredictability of the antisense technology.
The district court found a high level of experimentation necessary to adapt antisense technology from E. coli to other cell types, citing the inventor's numerous failed attempts to regulate gene expression in both prokaryotic and eukaryotic organisms. Key examples included Inouye’s failures to control specific genes in yeast and E. coli. Enzo did not contest the district court's conclusions regarding these failures but argued they were not indicative of nonenablement because the methodologies from the specifications were allegedly not followed. Enzo claimed that the researchers lacked the requisite skill level for eukaryotic experiments and that the court oversimplified the skills needed across different sub-fields. However, the court disagreed, noting that Inouye indicated the methodologies used in at least five failed experiments were consistent with those described in the specifications. The district court established that a person of ordinary skill in the art would be a junior faculty member or a postdoctoral student with relevant experience, a conclusion supported by witness backgrounds. Enzo's argument that the failures were not relevant due to the skill level of the researchers was rejected, as the record showed that the researchers were indeed of appropriate skill, primarily consisting of research associates with advanced qualifications.
Enzo's claims lack support and are unconvincing, particularly regarding the skill level necessary for the invention. The court disagrees with Enzo's assertion about the district court's error in determining this level, emphasizing that post-graduate researchers possess a significant skill set relevant to the invention. While acknowledging the specialized nature of genetics, the court cites a precedent establishing that specifications must enable practitioners in distinct arts to successfully apply their expertise. The researchers involved in the experiments were not merely technicians; they had the requisite skills to conduct experiments beyond E. coli, making it implausible that Inouye would risk resources if he doubted their abilities. The court also highlights that three of the failed experiments focused on genes within E. coli, which was Inouye's area of expertise, supporting the conclusion that the district court's evaluation of skill level was correct.
The district court found that the guidance in the specifications was limited, despite broad claims, highlighting the unpredictability of antisense technology and the extensive experimentation needed outside E. coli. The court reflects on the challenge of enabling broad claims with minimal examples in unpredictable biological contexts, noting that sufficient disclosure must be provided to inform skilled individuals on how to utilize the invention effectively. In this case, the specifications offered merely a vague "plan" for experimentation in eukaryotic cells without adequate direction or detail for successful execution.
In the case referenced, the court reiterated that a mere concept or "germ of an idea" does not meet the standards for enabling disclosure required under 35 U.S.C. § 112, ¶ 1. While the specifications need not exemplify every aspect of a claim, they must provide sufficient detail for skilled individuals to understand and implement the invention. The district court found that the specifications related to antisense technology offered minimal guidance for applications beyond E. coli, rendering them inadequate for enabling such practices.
Enzo argued that the basic elements of the invention were adequately disclosed and that Calgene's claims of undue experimentation were irrelevant. However, the court sided with Calgene, asserting that Enzo misunderstood the necessary extent of disclosure and mischaracterized Calgene's burden of proof. While the specifications outlined fundamental components of antisense constructs applicable to both eukaryotic and prokaryotic cells, they failed to provide practical guidance or examples for eukaryotic applications, merely suggesting the potential for such use.
Calgene successfully demonstrated, through evidence of Inouye's failures with both eukaryotes and E. coli, that following the specifications would not enable the claimed invention. The burden to explain the failures did not fall on Calgene, as the inventor is not required to understand the workings of their invention to obtain a patent. Thus, the court concluded that Enzo's claims lacked sufficient enabling disclosure.
Enzo argues that the court overlooked post-filing evidence supporting enablement, including conclusions from the PTO and EPO. Citing Fromson v. Advance Offset Plate, Inc., Enzo asserts that an Examiner's decision, while non-binding, is crucial evidence in assessing whether the party claiming invalidity has met its burden of proof. The PTO's approval of the claims relied significantly on the Silverstein Declaration, submitted after multiple rejections due to non-enablement concerns regarding antisense technology's unpredictability outside E. coli. The declaration contains mainly conclusory statements and references several notable publications in prestigious journals, suggesting that these successes, especially in eukaryotes, could indicate nonenablement as much as enablement. The court ultimately determined that enablement is a legal question, concluding that the PTO's allowance should carry minimal weight due to the lack of substantial evidence supporting enablement and the inclusion of Inouye's failed attempts not presented to the PTO. Additionally, the district court dismissed the EPO ruling, denying Enzo's motion to reopen the record for its consideration, which was deemed a proper exercise of discretion. Furthermore, Calgene contended that Enzo's evidence was inconclusive, as it failed to demonstrate that post-filing successes followed the patent's specifications. Enzo's argument that the broad concepts outlined in the specifications support enablement was insufficient, given that significant experimentation beyond these concepts was required to achieve results.
The district court's decision to give minimal weight to post-filing evidence was upheld. Enzo argued that the dependent claims of the '931 and '149 patents, particularly those related to prokaryotes, should not be deemed invalid due to the nonenablement of an independent claim. Enzo asserted that the invention could be practiced in prokaryotes and that relevant examples were included in the specifications. In contrast, Calgene maintained that the nonenablement ruling applied to the dependent claims as well, citing that successful antisense regulation was only demonstrated in E. coli. The court clarified that its enablement ruling pertains solely to the claims at issue, specifically focusing on claim 1, with other claims falling together with it, including the dependent claim directed to prokaryotes. The court expressed confusion over the assertion of a claim intended for prokaryotes against a eukaryotic entity, a tomato. Ultimately, the court found no clear error in the district court's fact findings, including the broad nature of the claims, unpredictability of antisense technology, and the significant experimentation needed for prokaryotes beyond E. coli. The specifications were deemed insufficient for enabling the broader claims, leading to the conclusion that the claims were invalid for lack of enablement.
In a cross-appeal, Calgene challenged the district court's decision not to rule on the enablement of the '065 patent, arguing it should be invalid due to shared written descriptions with the other patents and because it was anticipated and obvious under 35 U.S.C. 102 and 103. Enzo countered that the district court had dismissed Calgene's counterclaim on its merits rather than refusing to rule.
Enzo asserts that the validity of the claims is independently presumed, arguing that Calgene cannot extend the court's ruling on claims '931 and '149 to the '065 claims. Enzo also claims Calgene failed to provide evidence against the enablement of the '065 claims and presents arguments against their invalidity based on anticipation or obviousness. Both parties seek clarification regarding the patent. A key issue is the jurisdiction over Calgene's cross-appeal due to the district court's judgment not being recorded in a separate document, as mandated by Federal Rule of Civil Procedure 58. This omission raises questions about the finality of the judgment, essential for jurisdiction under 28 U.S.C. 1291. However, the Court of Appeals finds it has jurisdiction, citing Bankers Trust Co. v. Mallis, where the Supreme Court allowed for jurisdiction despite procedural errors when both parties waive issues regarding separate documents. The court notes that it is evident the district court's opinion resolved all matters and that neither party contests the district court's completion of its work. Thus, sending the case back for a formal entry of judgment would only delay proceedings unnecessarily. Consequently, the court affirms its jurisdiction to hear the cross-appeal and addresses the substantive issues, rejecting Calgene's claim that the district court refused to entertain the invalidity counterclaim.
The district court's dismissal of Calgene's counterclaim regarding Enzo's '065 patent is affirmed as a dismissal on the merits, primarily due to Calgene's failure to provide clear and convincing evidence for its claims of invalidity based on lack of enablement. Calgene's assertion that evidence from related patents ('931 and '149) could be applied to the '065 patent was rejected; the court emphasized that each patent must be evaluated independently for validity. Calgene did not adequately analyze the enablement of the '065 patent claims, which hindered its argument. Furthermore, the court declined to independently invalidate the '065 patent, as Calgene failed to prove its invalidity on any grounds. Enzo's request to reopen the record to introduce new evidence was deemed an abuse of discretion by the district court. However, it was determined that the court was not obligated to provide detailed reasons for denying such a motion, and thus, Calgene's position was upheld. The ruling underscores the necessity for rigorous evidence presentation and the independence of patent claims in validity assessments.
The district court's denial of Enzo's motion to reopen its case was affirmed, as Rule 52(c) was deemed inapplicable. Under Rule 52(a), the court's summary denial did not indicate a lack of consideration of the newly submitted evidence. Enzo's first motion aimed to introduce evidence that allegedly contradicted Calgene's noninfringement claims, including a publication on the FLAVR SAVR tomato. However, this evidence was not newly discovered, as Enzo failed to explain why it was not presented during the trial. The court found that the issue of infringement was moot due to the invalidity of the claims. The second motion sought to introduce additional post-trial evidence, including expert publications and omitted technical articles, which were considered cumulative of already presented evidence. The district court was noted to have thoroughly reviewed extensive evidence before its decision, and its discretion was not found to be abused.
On cross-appeal, Calgene argued that the district court should have addressed the issue of inequitable conduct prior to determining whether the case was exceptional under 35 U.S.C. § 285, which allows for reasonable attorney fees in exceptional cases. Calgene claimed that both Inouye and Enzo withheld significant information from the PTO, constituting "fraud on the Patent Office." Enzo countered that there was no precedent for Calgene’s argument and that the court had already evaluated the allegations without finding them to warrant an exceptional case designation. The conclusion was reached that the district court erred by not first assessing the inequitable conduct before ruling on the exceptional status of the case.
The court determined that the absence of findings regarding the lack of disclosure of sale offers and prior art signifies that the alleged inequitable conduct was not assessed by the district court when deciding against sanctions. It was concluded that the district court erred by failing to evaluate whether A.B. Chance engaged in inequitable conduct before the PTO. Consequently, the court vacated the district court’s denial of attorney fees and sanctions, remanding for reconsideration of these issues. The facts in this case closely mirrored those in A.B. Chance, where allegations were made against Inouye and Enzo for not disclosing evidence of Inouye's unsuccessful attempts to practice antisense in certain organisms. The district court had stated that the conduct of both parties did not warrant a finding of "exceptional circumstances," focusing instead on general litigation conduct rather than the specific allegations of inequitable conduct. This focus constituted an error, prompting the court to vacate the district court's conclusion regarding the exceptional case issue and remand for a consideration of inequitable conduct. The district court's ruling that certain patents were invalid as non-enabled was upheld, but the failure to address the inequitable conduct before ruling on the exceptional case was deemed a mistake. The final decision affirmed some aspects, vacated others, and remanded for further action.
The eukaryote superkingdom encompasses all higher organisms, including plants, animals, and fungi, while the prokaryote superkingdom includes lower microorganisms like E. coli. Key distinctions between these superkingdoms include the presence of a membrane-bound nucleus in eukaryotes and the additional gene expression pathways in eukaryotes, such as intron splicing, which are absent in prokaryotes. While gene and mRNA transcripts are simplified to six bases for illustrative purposes, actual lengths are much longer, with E. coli averaging around 1,200 bases.
The document references a diagram that illustrates a potential mechanism for antisense action in gene expression, though no universally accepted mechanism is established. It notes the distinction between Calgene's '065 patent and Enzo's '065 patent, with Enzo seeking a declaratory judgment of invalidity based on obviousness, but the district court found insufficient evidence to declare it so.
The court concluded that undue experimentation is required to apply antisense technology to cells beyond those described in the patent specifications, leading to a determination that the patents are not enabled and must be declared invalid. The opinion clarifies that while the patents were termed unenforceable, the court did not address inequitable conduct, suggesting an interchangeable use of "invalid" and "unenforceable" that should be disregarded. Additionally, the court reviewed failures by others in controlling gene expression via antisense but noted the importance of adhering to patent specifications for such proof. Lastly, it acknowledged the evolving nature of scientific predictability, indicating that current unpredictability does not permanently restrict the scope of patent claims.
