Abbott Laboratories v. Sandoz, Inc.
566 F.3d 1282 (2009)
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Rule of Law:
For infringement purposes, process terms in a product-by-process patent claim serve as limitations to the scope of the claim. An accused product can only infringe a product-by-process claim if it was made using the process steps recited in that claim.
Facts:
- Astellas Pharma Inc. owns U.S. Patent No. 4,935,507 ('507 patent) for a specific crystalline form of the antibiotic cefdinir, known as 'Crystal A'.
- Abbott Laboratories is the exclusive licensee of the '507 patent and markets a drug called Omnicef, which contains Crystal A cefdinir.
- The '507 patent claims priority from a Japanese patent application that disclosed and described both Crystal A and another form, Crystal B (cefdinir monohydrate).
- During the prosecution of the '507 patent in the U.S., the applicants removed all references to Crystal B, focusing the specification and claims exclusively on Crystal A.
- Lupin Ltd. developed a generic version of Omnicef that contains almost exclusively the Crystal B form of cefdinir.
- Lupin manufactures its generic cefdinir product using a different process than the processes described in the '507 patent for producing Crystal A.
- Sandoz, Inc. and Teva Pharmaceuticals also filed applications to market generic versions of Omnicef containing primarily Crystal B cefdinir.
Procedural Posture:
- Lupin Ltd. filed a declaratory judgment action against Abbott Laboratories in the U.S. District Court for the Eastern District of Virginia, seeking a ruling of noninfringement of the '507 patent.
- Abbott counterclaimed for patent infringement.
- The Virginia District Court (trial court) construed the patent claims and ruled that claims 2-5 were product-by-process claims whose scope was limited by the recited process steps.
- The Virginia District Court granted summary judgment of noninfringement in favor of Lupin. Abbott (appellant) appealed to the U.S. Court of Appeals for the Federal Circuit.
- In a separate action, Abbott sued Sandoz, Inc., Teva Pharmaceuticals, and others in the U.S. District Court for the Northern District of Illinois for infringement of the same patent.
- Abbott moved for a preliminary injunction in the Illinois case, and the parties agreed to be bound by the Virginia court's claim construction.
- The Illinois District Court denied Abbott's motion for a preliminary injunction. Abbott (appellant) appealed this decision to the Federal Circuit.
- The Federal Circuit consolidated the two appeals.
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Issue:
Do the process terms in a product-by-process patent claim limit the scope of the claim for purposes of determining infringement?
Opinions:
Majority - Rader, Circuit Judge.
Yes. Process terms in product-by-process claims serve as limitations in determining infringement. The court held that to infringe such a claim, an accused product must be made by the process recited in the claim. The court based its reasoning on a long line of Supreme Court precedents, including Smith v. Goodyear Dental Vulcanite Co. and Cochrane v. BASF, which established that process details are an integral part of the invention when included in the claim. This rule provides clear public notice of the patent's scope, as the inventor has chosen to define the product by its method of creation. By expressly overruling its own conflicting precedent in Scripps Clinic & Research Foundation v. Genentech, Inc., the court resolved an internal conflict and affirmed the principle that all elements of a claim, including process steps, are material and must be considered for infringement analysis.
Dissenting - Newman, Circuit Judge.
No. The majority's holding overturns a century of precedent and eliminates the 'rule of necessity,' which justly allowed inventors to patent new and complex products (like chemical and biological compounds) whose structures could not be fully described at the time of invention except by reference to the process that made them. Such claims should be treated as true product claims, meaning they are infringed by the product itself, regardless of the method of production. The majority's new rule improperly construes claims differently for validity (where they are treated as product claims) and infringement (where they are now treated as process claims), violating a fundamental tenet of patent law. Furthermore, the Supreme Court cases relied upon by the majority involved patents for new processes to make old, known products, a situation distinct from the patenting of a novel product.
Dissenting - Lourie, Circuit Judge.
No. A distinction should be made between old and new products when interpreting product-by-process claims. While Supreme Court precedent supports limiting the claim scope for old products made by a new process, it does not foreclose treating a claim for a truly new product as a full product claim, infringed by the product regardless of the manufacturing method. The law should adapt to modern innovations, particularly in the chemical and biological fields, where claiming a new product by its process of preparation may be necessary. A bright-line rule that treats all such claims as limited by the process is inappropriate, as differing claim language (e.g., 'obtainable by' versus 'when made by') and circumstances should be considered.
Analysis:
This landmark en banc decision resolved a long-standing and significant conflict within Federal Circuit precedent regarding the scope of product-by-process claims, siding with the narrower interpretation from Atlantic Thermoplastics over the broader one from Scripps Clinic. By holding that process limitations are always binding for infringement, the court significantly reduced the value and scope of this claim format. This provides greater certainty for competitors, who can now design around such patents by simply altering the manufacturing process. However, it is a major blow to inventors in complex fields like biotechnology and chemistry, who may not be able to fully characterize a novel product by its structure alone and now have weaker protection for their inventions.
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