Inventive step, obvious-to-try and hindsight

Gedeon Richter plc v Bayer Schering Pharma AG [2011] EWHC 583 (Pat), 17 March 2011, is a recent decisoin of Mr Justice Floyd in the Patents Court for England and Wales.  A keenly-fought contest which required six days of hearings, it resulted in a 186-paragraph judgment in which Richter, a Hungarian company, sought revocation of two Bayer contraceptive patents which are currently in the midst of opposition proceedings before the European Patent Office. In the result, Floyd J held some of Bayer's claims were invalid for obviousness but not for added subject matter.

PatLit picks up just one of the many points in this decision: the effect of something being obvious to try. In Conor v Angiotech (see the IPKat here) the House of Lords said that the notion of something being obvious to try was useful as a means of establishing obviousness only where there was a fair expectation of success resulting from trying it. However in this case both parties agreed that, while it would have been obvious to carry out in vitro pre-formulation testing, such tests would be performed in ignorance of the outcome and of whether any specific formulation strategy would have a fair expectation of success. There was no general rule: rather, it was necessary to look at each putative step which the skilled person was required to take and only then decide whether it was obvious.  One could then ask an overall question as to whether this step-by-step analysis, performed after the event, might not in fact be unrealistic or produce a result that was driven by hindsight.

Commercial success: not the easy way to prove non-obviousness

The December 2008 Finnegan newsletter "Last Month at the Federal Court" carries a note on In re DBC, No. 08-1120 (Fed. Cir. Nov. 3, 2008), in which the Federal Circuit held that, during ex parte reexamination, evidence that it was necessary for a patentee asserting the validity of its patent to prove that sales of its product were a direct result of the unique characteristics of its claimed invention in order for it to demonstrate non-obviousness, where the non-obviousness was founded on an assertion of commercial success.

DBC's patent was for a nutraceutical composition comprising a mixture of the pulp and pericarp of the mangosteen fruit. The USPTO granted a third party’s request for ex parte reexamination and rejected the patent in its entirety as being obvious over a combination of seven prior art references. To provide objective evidence of nonobviousness, DBC submitted three declarations which sought to demonstrate the success of the commercial embodiment of the patented invention, sold commercially as XanGo juice. The examiner, unpersuaded by DBC’s evidence, made the rejection final in a decision that was upheld by the Board. DBC then appealed to the court.

The Federal Circuit agreed that there was substantial evidence to support the Board’s determination that DBC’s evidence of commercial success was insufficient to upset the prima facie case of obviousness. Declarations made by officers and employees of XanGo LLC, the exclusive licensee of DBC and marketer of XanGoTM juice, were offered in an attempt to show that the juice was made according to the patent's claims and to demonstrate the commercial success of XanGo juice. The evidence was sufficient to demonstrate that XanGoTM juice fell within the scope of the claims and DBC did not need to show that the product fell within every conceivable embodiment of the claims in seeking to rely upon evidence of commercial success. However, the sales evidence had to reveal in some way that the driving force behind those sales was the claimed combination -- after all, the sales might have been boosted by factors other than the patent, such as the increasing popularity of the fruit from which it was made or the appealing nature of the branding and marketing strategy that sold it.

This blog notes that the court's decision, which is based on logical and patent-relevant premises, imposes a substantial evidential burden upon the patent owner.  Corporate trading records are not kept with a view to separating out the various strands of intellectual property which may be exploited in the sale of a product, and in the case of a soft drink the success of a product might relate to causes as diverse as unusual climatic conditions, conscious or unconscious celebrity endorsements, product placements, weak marketing on the part of competitors or innovative packaging and design. This burden makes the notion of defending against an assertion of non-obviousness by reference to the gap between the challenged patent and the prior art seem very much the lesser of two evils.