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By: Michael Furrow and Shannon Clark, Fitzpatrick, Cella, Harper & Scinto
Section 101 of the Patent Act provides: “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.” 35 U.S.C. § 101. The Supreme Court has held that this section contains an important implicit exception for laws of nature, natural phenomena, and abstract ideas. Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347, 2354 (2014); see also Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 70 (2012).
The U.S. Court of Appeals for the Federal Circuit has expressed that patent eligibility is a threshold issue of law that may be amenable to resolution through an early dispositive motion, thereby minimizing unnecessary burdens on the parties and the court. See, e.g., Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1373–75 (Fed. Cir. 2015); Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 717–19 (Fed. Cir. 2014); OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1364 (Fed. Cir. 2015) (Mayer, J., concurring).
This article considers strategies that you as the patentee may utilize when facing patent eligibility challenges early in litigation. Although much of the content is generalizable, special attention is given to inventions in the life sciences. When § 101 challenges arise in the life sciences arena, the claims commonly in focus are those directed to methods or tools for analysis of biological samples, compositions of matter based on naturally occurring materials, or methods of treatment using compositions that are asserted to be naturally occurring.
Two-Step Alice Framework
Following the Supreme Court’s decision in Alice Corp., there has been a significant increase in the number of patents challenged under § 101. Courts follow a two-step framework when “distinguishing patents that claim laws of nature, natural phenomena, and abstract ideas from those claiming patent-eligible applications of those concepts.” 134 S. Ct. at 2355 (citing Mayo, 566 U.S. at 77–80). At step one, courts must determine “whether the claims are directed to one of those patent-ineligible concepts.” Id. If they are, courts must consider the elements of each claim both individually and “as an ordered combination” to determine whether additional elements transform an abstract idea into a patent-eligible invention. Id. This second step is equated with “a search for an ‘inventive concept’—i.e., an element or combination of elements that is ‘sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the [ineligible concept] itself’.” Id. (citing Mayo, 566 U.S. at 72–73).
FRCP 12(b)(6) and 12(c) Standards
Federal Rule of Civil Procedure 12(b)(6) governs a motion to dismiss a complaint for failure to state a claim upon which relief can be granted. The purpose of such a motion is to test the sufficiency of the complaint, not to resolve disputed facts or decide the merits of the case. See, e.g., Swierkiewicz v. Sorema N. A., 534 U.S. 506, 511 (2002); Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 563 n.8 (2007). A motion to dismiss may be granted if, after accepting all well-pleaded allegations in the complaint as true and viewing them in the light most favorable to the plaintiff, the plaintiff is not entitled to relief. See, e.g., Maio v. Aetna, Inc., 221 F.3d 472, 481–82 (3d Cir. 2000) (citation omitted) Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n, 776 F.3d 1343, 1349 (Fed. Cir. 2014).
Rule 12(c) of the Federal Rules of Civil Procedure permits a party to move for the dismissal of a suit “[a]fter the pleadings are closed . . . but early enough not to delay trial.” Fed. R. Civ. P. 12(c). A Rule 12(c) motion for judgment on the pleadings is “functionally identical” to a Rule 12(b)(6) motion to dismiss for failure to state a claim. Cave Consulting Grp., Inc. v. Truven Health Analytics, Inc., No. 15-cv- 02177-SI, 2016 U.S. Dist. LEXIS 8395 (N.D. Cal. Jan. 25, 2016) (citing Dworkin v. Hustler Magazine, Inc., 867 F.2d 1188, 1192 (9th Cir. 1989)); Affinity Labs of Texas, LLC v. Amazon.Com, Inc., 2015 U.S. Dist. LEXIS 77411 (W.D. Tx. June 12, 2015) (citing Doe v. MySpace, Inc., 528 F.3d 413, 418 (5th Cir. 2008)). Courts must accept all factual allegations in the complaint as true and construe them in the light most favorable to the non-moving party. See, e.g., Allergan, Inc. v. Athena Cosmetics, Inc., 640 F.3d 1377, 1380 (Fed. Cir. 2011); Johnson v. Rowley, 569 F.3d 40, 43-44 (2d Cir. 2009). The motion may be granted if the moving party establishes that no material issue of fact remains to be resolved, and the party is entitled to judgment as a matter of law. See, e.g., Mele v. Fed. Reserve Bank of N.Y., 359 F.3d 251, 253 (3d Cir. 2004); Colony Ins. Co. v. Burke, 698 F.3d 1222, 1228 (10th Cir. 2012).
Although the focus of this article is on eligibility challenges by motion under Rules 12(b)(6) or (c), Rule 12(d) states that “[i]f, on a motion under Rule 12(b)(6) or 12(c), matters outside the pleadings are presented to and not excluded by the court, the motion must be treated as one for summary judgment.” Thus, the Fed. R. Civ. P. 56 standard may (albeit rarely) become pertinent. Summary judgment is appropriate if the evidence shows that there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). In determining whether a genuine dispute as to a material fact exists, the courts must view the evidence in the light most favorable to the non-moving party and draw all justifiable inferences in its favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). Nonetheless, the party opposing summary judgment may not rely on mere conclusory allegations nor speculation, but instead must offer evidence in support of its factual assertions. See, e.g., D’Amico v. City of New York, 132 F.3d 145, 149 (2d Cir. 1998); Thornhill Publ’g Co., Inc. v. GTE Corp., 594 F.2d 730, 738 (9th Cir. 1979).
What Is the Burden of Proof?
There is mixed guidance on whether a § 101 challenge must satisfy the clear and convincing invalidity standard of 35 U.S.C. § 252. Some courts adhere to this standard when adjudicating a § 101 challenge. See, e.g., Endo Pharms. Inc. v. Actavis Inc., 2015 U.S. Dist. LEXIS 127104 (D. Del. Sept. 23, 2015) (citations omitted); Affinity Labs of Texas, LLC v. DirecTV, LLC, 109 F.Supp.3d 916, 932–33 (W.D. Tex. 2015); Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 720 (Fed. Cir. 2014) (Mayer, J., concurring) (citation omitted). That said, because in early eligibility challenges all facts alleged by the patentee are taken as true, and disposition is an issue of law, many courts believe it makes little sense to consider an evidentiary standard. See, e.g., Mimedx Group, Inc. v. Nutech Med., Inc., 2015 U.S. Dist. LEXIS 158867 (N.D. Ala. Nov. 24, 2015); Esoterix Genetic Labs. v. Qiagen Inc., 133 F.Supp.3d 349 (D. Mass. 2015); Exergen Corp. v. Brooklands Inc., 125 F.Supp.3d 312 (D. Mass. 2015). See also Microsoft Corp. v. 141 Ltd. P’ship, 131 S.Ct. at 2253 (clear and convincing standard applies only to questions of fact) (Breyer, J., concurring).
Draft the Complaint with Eligibility in Mind
In evaluating the sufficiency of a complaint, generally (with limited exceptions, discussed below), courts may consider the complaint, documents attached to the complaint, and documents referenced by the complaint. See, e.g., OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1363 (Fed. Cir. 2015); Lone Star Fund V (U.S.) L.P. v. Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir. 2010). Thus, you should consider incorporating factual allegations pertinent to Alice steps 1 and 2, with supporting citations, into the complaint to aid in responding to any potential eligibility arguments. See, e.g., Xlear, Inc. v. STS Health, Ltd. Liab. Co., 2015 U.S. Dist. LEXIS 167707, at *4–5 (D. Utah Dec. 14, 2015).
Identify and Explain the Materiality of Disputed Facts
As with any opposition to a motion to dismiss, you cannot rely on bare assertions that dispositive facts are in dispute, precluding resolution. As the patentee, you must explain how any purported factual disputes bear on resolution of the two steps in the eligibility inquiry. See, e.g., Genetic Techs. Ltd. v. Lab. Corp. of Am. Holdings, 2014 U.S. Dist. LEXIS 122780, at *15 (D. Del. Sep. 3, 2014). Persuasively identifying and supporting such disputes—for example concerning whether a person of ordinary skill in the art would view the limitations in the challenged claims as well-understood, routine, or conventional (see later discussion)—is the goal of any opposition to an early dispositive motion. See, e.g., Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC, 2016 U.S. Dist. LEXIS 114259 (D. Mass. Aug. 25, 2016); Classen Immunotherapies, Inc. v. Biogen Idec, 2012 U.S. Dist. LEXIS 112280 (D. Md. Aug. 9, 2012).
Identify and Explain the Relevance of Non-trivial Questions of Claim Interpretation
If you can identify disputes concerning claim meaning that are material to the eligibility determination, the court may deny the motion or hold off on any determination until after the claim construction record has been fleshed out. The Federal Circuit has recognized that “it will ordinarily be desirable—and often necessary— to resolve claim construction disputes prior to a § 101 analysis, for the determination of patent eligibility requires a full understanding of the basic character of the claimed subject matter.” Bancorp Servs., L.L.C. v. Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266, 1273–74 (Fed. Cir. 2012). In practice, however, this can present a high bar. The court may be willing to take on a discrete legal question of construction, or simply express that its understanding of the claims is “sufficient” based upon the briefing for the purposes of the motion. Boehringer Ingelheim Pharms., Inc. v. HEC Pharm Co., Ltd., 2016 U.S. Dist. LEXIS 169812 (D. N.J. Dec. 7, 2016). Or parties bringing a § 101 challenge may argue that the dispute over meaning of claim language is immaterial, because the outcome would be the same under either party’s construction. See, e.g., Genetic Techs. Ltd. v. Lab. Corp. of Am. Holdings, 2014 U.S. Dist. LEXIS 122780 (D. Del. Sept. 3, 2014); Cleveland Clinic Found. v. True Health Diagnostics, LLC, 2016 U.S. Dist. LEXIS 21907, at *6-7 (N.D. Ohio Feb. 23, 2016). Thus, as is true with any disputed facts, you must explain out how the § 101 analysis would materially change if certain terms are accorded your proposed construction rather than the challenger’s, and you should articulate how the issues of construction are too complex or numerous to be fairly resolved at a preliminary stage of litigation. See CyberFone Sys., LLC v. CNN Interactive Grp., Inc., 558 Fed.Appx. 988, 992 n.1 (Fed. Cir. 2014); Bancorp Servs. L.L.C. v. Sun Life Assurance Co. of Canada, 687 F.3d 1266, 1273 (Fed. Cir. 2012); Genetic Veterinary Sci. v. Canine EIC Genetics, LLC, 101 F.Supp.3d. 833, 842–43 n. 3 (D. Minn. 2015).
If Appropriate, Supplement the Record
You should also consider whether judicial notice could be employed to supplement the record. Judicial notice may be taken of facts that are “generally known” or “can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned.” Fed. R. Evid. 201. But where the movant reasonably disputes the accuracy or meaning of a factual assertion within a document, notice is generally denied. For example, although documents containing a patent’s prosecution history and prior art references are publicly available, they may be inappropriate for judicial notice when the accuracy of factual statements within those documents may be disputed. See, e.g., ContourMed v. Am. *** Care L.P., 2016 U.S. Dist. LEXIS 34408 (S.D. Tex. Mar. 17, 2016). Nevertheless, not every helpful fact will be subject to any reasonable dispute. For example, courts have taken notice of teachings in the art when well known to the relevant scientific community. See Ameritox, Ltd. v. Millennium Health, LLC, 88 F. Supp. 3d 885, 892 (W.D. Wis. 2015); Affinity Labs of Texas, LLC v. Amazon.com Inc., 838 F.3d 1266, 1270 (Fed. Cir. 2016).
Additionally, in rare circumstances as discussed above, courts may be willing to treat the motion as a summary judgment motion and consider evidence the patentee attaches to its response, particularly where the movant has itself gone beyond the record. Such instances tend to permit greater opportunity to supplement the record by, for example, attaching an expert declaration or exhibits explaining the features and advantages of the invention. See, e.g., Rutgers v. Qiagen N.V., 2016 U.S. Dist. LEXIS 24736 (D. N.J. Feb. 29, 2016).
As stated in the introduction, eligibility challenges to life sciences patents commonly involve claims directed to methods or tools for analysis of biological conditions, and applications thereof. For example:
Compositions of matter have also been challenged as being the same as naturally occurring materials. For example:
Also, claims to methods of treatment using compositions that are asserted to be naturally occurring materials may be attacked. For example:
Of course, this list simply identifies targets that may be more likely to be challenged and is not meant to be exclusive.
Keep the Normative Point Central: The Public Here Is Not Foreclosed from Using a Law of Nature, Natural Phenomenon, or Abstract Idea
The overarching concern behind the implicit exception to § 101 is one of preemption: the exception encompasses the “basic tools of scientific and technological work” and recognizes that authorizing “monopolization of those tools through the grant of a patent might tend to impede innovation more than it would tend to promote it.” Mayo, 132 S. Ct. at 1293 (citing Gottschalk v. Benson, 409 U.S. 63, 67 (1972)). Thus, you should focus on clearly illustrating how and why the claims under review do not preempt the public use of a law of nature, natural phenomenon, or abstract idea. See, e.g., Rapid Litigation Mgmt. Ltd. v. CellzDirect, Inc., 827 F.3d 1042, 1052 (Fed. Cir. 2016); Rutgers v. Qiagen N.V., 2016 U.S. Dist. LEXIS 24736 (D. N.J. Feb. 29, 2016) (inventions limited to specific application of a diagnosis of a specific infection involving only specific antigens and causing a specific response where alternatives existed for each); Ameritox, Ltd., 88 F. Supp. 3d at 916-917 (holding that some claims do not preempt a natural law while others do).
Strategy Considerations in Addressing Alice Step 1
The goal of the party seeking early resolution will be to characterize your method claims as nothing more than the observation, identification, or analysis of a natural phenomenon, and your composition claims as not materially distinct from naturally occurring material. For example:
Focus on Elements That Take the Claims Beyond Excepted Subject Matter, Even if the Elements Themselves Are Well-Known
Movants will invariably focus on certain aspects or perceived phenomena involved in your claim to characterize the claim as being directed to one of the excepted ineligible concepts. In so doing, movants often describe claims at such a high level of abstraction or through such a narrow lens that some courts have referred to the general approach as “reductionist simplicity.” See Verint Syst. Inc. v. Red Box Records Ltd., 226 F. Supp. 3d 190 (S.D. N.Y. Dec. 7, 2016). The Supreme Court has acknowledged that “[a]t some level, ‘all inventions . . . embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.’” Alice, 134 S. Ct. at 2354 (citing Mayo, 566 U.S. at 1293). Thus, you will invariably have to explain how the challenged claim, when considered in its entirety, at most simply involves the allegedly ineligible subject matter and is not directed to it. See Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016); Rapid Litigation Mgmt., 827 F.3d at 1049. “Patenting the concept of lift is inappropriate under § 101. Patenting a particular airplane wing is not.” Femto-Sec Tech., Inc. v. Lensar, Inc., No. 15-cv-1689, 2016 U.S. Dist. LEXIS 189327 (C.D. Cal. June 8, 2016). For the purposes of Alice step 1, it should not matter if the elements that distinguish the subject matter from any ineligible aspect were themselves inventive or well-known.
For example, in Rapid Litigation Management Ltd. v. CellzDirect, Inc., the claim concerned a method for producing “a preparation of multi-cryopreserved cells.” 827 F.3d at 1048. The movant focused on the cells’ capability of surviving multiple freeze-thaw cycles, to identify what it called a “natural law.” Id. The patentee explained that the claims are not directed to that feature of the cells, but rather a “constructive process” comprising concrete steps for preserving the cells. Id. (“Indeed, the claims recite a ‘method of producing a desired preparation of multi-cryopreserved hepatocytes.’”).
In Baxter International, Inc. v. CareFusion Corp., CareFusion argued that the claims at issue were directed to the abstract idea of calculating the remaining time on a battery, using well-known voltage and current measurements. 2016 U.S. Dist. LEXIS 63581, at *24 (N.D. Ill. May 13, 2016). In response, Baxter explained how CareFusion ignored components including medical infusion pump, battery, alarm, display and electrical circuits. Id. at 25. CareFusion’s argument that the step 1 analysis should focus on alleged “novel” features (arguing that all of the tangible components of the claims were well-known) was rejected as irrelevant to the Step 1 inquiry. Id. at 28.
In Viveve, Inc. v. Thermagen, LLC, the challenged claims concerned methods for heating tissue and remodeling it once heated. 2017 U.S. Dist. LEXIS 60478, at *2 (E.D. Tex. Apr. 20, 2017). The movant focused on the natural phenomenon of collagen becoming malleable once heated. Id. at 3. The patentee, however, identified two steps that a physician must carry out: (1) heating the target tissue and (2) remodeling the therapeutic zone. Id. at 9. “This type of constructive process, carried out by an artisan to achieve a new and useful end, is precisely the type of claim that is eligible for patenting.” Id. at 14 (citing Rapid Litigation Mgmt., 827 F.3d at 1048).
In Rutgers v. Qiagen N.V., the challenged claims were to methods for detecting whether patients had been exposed to Mycobacterium tuberculosis. 2016 U.S. Dist. LEXIS 24736, at *1 (D. N.J. Feb. 29, 2016). The patentee plausibly argued that the “polypeptides or antigenic segments thereof in the compositions or methods” had “no naturally-occurring counterpart” and were “functionally distinct” from naturally occurring polypeptide antigens. Id. at 9.
Challenge the Movant’s Alleged Identification of Ineligible Subject Matter
You should also consider whether the movant actually even identified ineligible subject matter—sometimes there is no plausible way to reduce the claim that far. For example, a movant was unsuccessful in claiming that ultrashort pulse laser beams were naturally occurring phenomena. Femto-Sec Tech., Inc. v. Lensar, Inc., 2016 U.S. Dist. LEXIS 189327 (C.D. Cal. June 8, 2016). In another example, a court rejected the articulation of an alleged natural phenomenon underlying a claim as “heat denature[ing] collagen and caus[ing] remodeling” because the “remodeling is a process comprising a doctor’s application” of certain specific steps. Viveve, 2017 U.S. Dist. LEXIS 60478, at *9.
Strategy Considerations in Addressing Alice Step 2
With respect to Alice step 2, the party seeking early resolution will characterize any additional claim terms beyond those pertaining to excepted subject matter as conventional and assert that they have been applied in a routine manner. See, for example, Mayo at 87 (steps of administering the drug, measuring metabolite levels, and adjusting dosage were well known; the only new knowledge was of the natural phenomenon); Ariosa, 788 F.3d at 1377 (method claimed amounted to “a general instruction to doctors to apply routine, conventional techniques”); Genetic Techs. Ltd. v. Merial L.L.C., 818 F.3d 1369, 1377-1380 (Fed. Cir. 2016) (steps conventional, just applied to newly discovered law of nature).
Focus on the Combination of Elements That Is Unconventional
In an approach akin to the reductionism discussed in connection with Alice step 1, movants will often pull out each claim limitation separately and explain how they were well known and conventional. Patentees should bring the focus onto the claim as a whole and an evaluation of whether the claimed combination of elements was routine.
For example, in Rapid Litigation Management Ltd. v. CellzDirect, Inc., although the “individual steps of freezing and thawing were well known, but a process of preserving hepatocytes by repeating those steps was itself far from routine and conventional.” 827 F.3d at 1051.
In Ameritox v. Millennium Health, claim terms that “direct medical professionals to measure the level of a drug metabolite, to normalize data via a creatinine ratio, and then compare that value against the creatinine ratios of a population of individuals” were individually well known and routine, but the inventors’ coupling of a normalization step and comparative step was unconventional. 88 F.Supp.3d at 911.
In Idexx Laboratories, Inc. v. Charles River Laboratories, Inc., blood collection cards, analysis of samples for a biological marker, and use of immunoassay were all well known, but the “ordered combination of limitations . . . describe a specific, novel implementation.” 2016 U.S. Dist. LEXIS 87888, at *15 (D. Del. July 1, 2016).
Identify Problems in the Art and the Improvements the Invention Provides
Patentees should also identify the problems that existed in the art and how the invention—the claim as a whole—solved those problems or improved upon what was known and available. See DDR, 773 F.3d at 1257; Cal. Inst. of Tech. v. Hughes Communs., Inc., 59 F.Supp.3d 974, 1000 (C.D. Cal. 2014); cf. Alice, 134 S. Ct. at 2359 (“The method claims do not . . . purport to improve the functioning of the computer itself.”).
For example, in Ameritox v. Millennium Health, Ameritox explained how prior protocols were restricted and could only test for the “presence or absence of a drug metabolite in urine,” which presented a “major difficulty” because of large variance in metabolite concentrations in urine. It was through the inventors’ ingenuity that more accurate evaluation became available. 88 F.Supp.3d at 912.
In Idexx Laboratories, Inc. v. Charles River Laboratories, Inc., the method provided clear advances over the prior art including “permit[ting] one to monitor the health of rodent populations without euthanizing animals, waiting for blood to clot in a centrifuge, or shipping blood serum overnight in a refrigerated container.” 2016 U.S. Dist. LEXIS 87888, at *14 (D. Del. July 1, 2016).
In Rutgers v. Qiagen N.V., the patentee plausibly alleged that the claimed single-visit in vitro objective blood tests for exposure to Mycobacterium tuberculosis provided great improvements over prior multiple-visit in vivo skin tests, in which tuberculosis antigens were injected into patients’ arms, the site was inspected for irritation days later, and a subjective evaluation was made. 2016 U.S. Dist. LEXIS 24736, at *3-4 (D.N.J. Feb. 29, 2016).
In Viveve, Inc. v. Thermagen, LLC, the claims to heating and remodeling tissue provided improvements over the “only known methods for tightening the relevant tissue [which] required invasive surgical procedures which carried with them the risk of scarring.” 2017 U.S. Dist. LEXIS 60478, at *15 (E.D. Tex. Apr. 20, 2017)<,/a>.
If you plan to assert a patent with claims that may invite a § 101 eligibility challenge, your defensive strategy begins with including factual allegations and supporting citations pertinent to the inquiries in Alice steps 1 and 2 in the complaint. If an early challenge does arise, identify material factual disputes and claim construction issues that warrant development of a full record. To do so, consider challenging the movant’s alleged identification of excepted subject matter, and explain how the claim, when considered as a whole, is not in fact directed to that subject matter, but merely involves it. Also, explain how the claimed combination of elements is unconventional and provides improvements over the art. And keep the policy consideration central: the public is not foreclosed from using the alleged excepted subject matter because of the claim.
Michael Enzo Furrow is a partner with Fitzpatrick, Cella, Harper & Scinto. His experience with and understanding of the challenges innate to discovery in the pharmaceutical and biotechnology fields fuel his passion to enforce and defend life sciences patents. He has represented innovators across these industries in high-stakes patent disputes both in Federal Court and before the U.S. Patent and Trademark Office, concerning drugs or biologics for treating HIV/AIDS, Alzheimer’s disease, *** cancer, prostate cancer, bacterial infection, epilepsy, and various endocrine, vascular and gastrointestinal diseases, as well as genetically modified animals. Shannon Clark is an associate with Fitzpatrick, Cella, Harper & Scinto.
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