The judicially-created doctrine of obviousness-type double patenting is likely one of the most vexing doctrines of U.S. patent regulation. In Immunex Corp. v Sandoz Inc., the Federal Circuit added one other layer of complexity to the doctrine, deciding a licensed patent could be handled as a “generally owned” patent for functions of obviousness-type double patenting if the licensee managed prosecution and obtained “all substantial rights” within the patent. Having weighed in on this situation of regulation, the bulk determined that obviousness-type double patenting didn’t come up within the case earlier than it as a result of the unique licensee had not obtained all substantial rights. Nonetheless, this resolution underscores the care that needs to be taken when drafting patent agreements and will add one other merchandise to due diligence checklists.
Obviousness-Kind Double Patenting
As defined in Eli Lilly and Co. v. Barr Labs., Inc. (Fed. Cir. 2001), obviousness-type double patenting is a judicially-created doctrine designed to “prohibit a celebration from acquiring an extension of the appropriate to exclude by means of claims in a later patent that aren’t patentably distinct from claims in a generally owned earlier patent.” As famous within the Immunexdecision, “there are two justifications for this doctrine: (1) to forestall timewise extension of the appropriate to exclude; and (2) to forestall a number of infringement fits by totally different assignees.”
Whereas the doctrine beforehand has been utilized to patents with overlapping homeowners and/or overlapping inventors, Sandoz raised what the courtroom known as “a novel concept of widespread possession” for completely licensed patents. Particularly, Sandoz argued the “all substantial rights” check developed underneath 35 U.S.C. § 281 needs to be used to evaluate whether or not two patents are “generally owned” for functions of obviousness-type double patenting.
This offered the Federal Circuit with two questions: can a licensed patent give rise to obviousness-type double patenting, and if that’s the case, when?
The “All Substantial Rights” Check
The Federal Circuit resolution was authored by Choose O’Malley, and joined by Choose Chen. Choose Reyna authored a dissenting opinion agreeing with the bulk on the authorized points, however disagreeing on the result.
The bulk agreed adopting Sandoz’s “novel concept of widespread possession” would serve the targets of the doctrine. That’s, the courtroom agreed making use of the doctrine of obviousness-type double patenting to an completely licensed patent “would stop an efficient patentee from unjustifiably extending its patent time period through the use of the nominal label of licensee,” and likewise may “stop harassment by means of a number of infringement fits by totally different assignees asserting basically the identical patented invention.” The bulk stopped wanting importing § 281 jurisprudence into the doctrine of obviousness-type double patenting, and held:
We conclude solely that the place one of many rights transferred is the appropriate to prosecute the patent at situation, identification of the efficient “patentee” is informative in evaluating whether or not the patents are “generally owned” for functions of obviousness-type double patenting. The place, as right here, a celebration in the end controls prosecution of each units of patents, the “all substantial rights” check aids in stopping the unjustifiable issuance of claims which can be patentably vague from claims already owned by that celebration.
The bulk defined additional:
Beneath these circumstances, seeking to the “all substantial rights” check achieves the correct stability between deterring gamesmanship in prosecution, on the one hand, and avoiding any chilling impact on routine collaborations and licensing between events working in the identical subject of analysis, on the opposite.
The Settlement At Situation
The settlement at situation pertained to patents licensed from Roche referring to Immunex’s biologic rheumatoid arthritis drug Enbrel®. As summarized within the majority opinion, the settlement conveyed “a paid-up, irrevocable, unique license to the U.S. patent household,” “the only proper to grant sublicenses,” and “the unique proper to prosecute patent functions within the U.S. patent household.” The bulk’s reasoning evaluating whether or not the settlement conveyed all substantial rights centered on two of Roche’s retained rights: (1) a secondary proper to sue for infringement, and (2) a proper to veto the project of Immunex’s pursuits to any unrelated celebration:
The enforcement and alienation rights underneath the Accord & Satisfaction clarify that Roche didn’t switch all substantial rights within the patents to Immunex.
Thus, the bulk discovered the settlement had not transferred all substantial rights to Immunex, such that obviousness-type double patenting may not come up between the licensed patents and different patents owned by Immunex.
Choose Reyna’s Dissent
As famous above, Choose Reyna agreed with the bulk’s willpower that an completely licensed patent can provide rise to obviousness-type double patenting, however disagreed with the bulk’s willpower that the settlement at situation didn’t make Immunex an efficient proprietor of the patent at situation. Specifically, Choose Reyna discovered Roche’s retained rights to be “illusory”:
Immunex can at any time nullify Roche’s rights by ordering Roche to assign the patents-in-suit to Immunex upon cost of $50,000. …. Thus, if Immunex disagrees with Roche’s resolution to provoke swimsuit or Roche’s resolution to veto an project, Immunex can undo Roche’s selections by merely acquiring official possession of the patents-in-suit.
Be Cautious What You Want For
This resolution highlights the care that needs to be taken when drafting patent agreements, and the potential unintended penalties of drafting a license that has the impact of an project. Due diligence checklists usually concentrate on the validity and business worth of the patent households on the desk, however in view of this resolution licensees additionally could wish to contemplate whether or not they may increase obviousness-type double patenting points for his or her present portfolio.
Will Olson, Summer season Affiliate, additionally contributed to the creation of this text.