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September 12, 2012 Articles

Deconstructing Inventorship: A Method to the Madness

Credit for inventing a novel chemical composition requires two distinct criteria—knowledge of the chemical structure of a compound and the operative method of making it.

By Paul R. Coble and Carrie C. Ruzicka

Patent prosecutors, litigants, and fact finders in court frequently find it difficult to identify who has invented a novel chemical composition. The difficulty arises because inventorship in such cases requires "both knowledge of a specific chemical structure of the compound and an operative method of making it." Fina Oil & Chem. Co. v. Ewen, 123 F.3d 1466, 1473 (Fed. Cir. 1997).

On January 12, 2012, in Falana v. Kent State, 669 F.3d 1349 (Fed. Cir. 2012), the U.S. Court of Appeals for the Federal Circuit sought to clarify where to draw the line expanding the pool of inventors of novel chemical compounds in at least one regard. The concept of inventorship now includes an individual who created a novel process used to make the claimed compound, even if that individual never actually made the claimed compound. While Falana is a reasonable extrapolation of well-settled inventorship law for chemical compounds, the decision will require increased scrutiny of inventorship during both prosecution and enforcement of claims in the chemical arts.

In Falana v. Kent State, Dr. Olusegun Falana sued Kent State University, Kent Displays Inc. (KDI), and the inventors named in U.S. Patent No. 6,830,789 (the '789 patent), requesting that he be added under 35 U.S.C. § 256 as an inventor to the '789 patent. KDI and Kent State own the '789 patent, and KDI is a spin-off technology company from Kent State that designs and manufacturers liquid crystal displays (LCDs) used in electronic devices. The three named inventors were Joseph Doane, Asad Khan, and Alexander Seed. After Falana filed suit, he dismissed KDI, Doane, and Khan when they each filed statements with the district court, stating they had no disagreement with the addition of Falana as an inventor to the '789 patent. Kent State and Seed (collectively Kent State) remained as defendants.

The Northern District of Ohio held that Falana should have been named as an inventor on the '789 patent and ordered the U.S. Patent and Trademark Office to issue a certificate of correction adding him as a named inventor. See Falana v. Kent State Univ., No. 08-cv-720, 2010 U.S. Dist. LEXIS 132486 (N.D. Ohio Dec. 15, 2010). On appeal, the Federal Circuit addressed whether a putative inventor who envisioned the structure of a novel genus of compounds, and created a method of making those compounds, is a joint inventor of a claim covering those compounds. Affirming the district court's ruling, the Federal Circuit held that an individual who invents a novel method of making a new class of chemical compounds contributes to the conception of the compounds within that class.

The invention at issue in Falana rose from a KDI research program to develop new chiral additives—chemical compounds used to improve the performance characteristics of LCDs, such as color, contrast, and brightness. One of the main goals of the project was to develop a proprietary chiral additive for KDI that was temperature-independent over a wide range of temperatures for use in portable LCDs. The other named inventors of the '789 patent hired Falana to conceive and synthesize new chiral additives that satisfied the goals of the project.

While working on the KDI project, Falana synthesized numerous compounds as part of a team effort with the named inventors. Falana also developed a synthesis protocol to make a new class of chemical compounds called "naphthyl-substituted TADDOLS" (NATs). Falana used his new process—known simply as the Synthesis Protocol—to synthesize a chiral additive called Compound 7.

While Compound 7 showed great promise and significant progress toward finding a new, temperature-independent chiral additive, its range of temperature independence was not broad enough to satisfy the goals of the KDI research project.

Shortly after Falana left KDI, Seed, another researcher on the project, used Falana's Synthesis Protocol to synthesize another NAT known as Compound 9. Testing revealed that Compound 9 had a substantial range of temperature independence, satisfying the objectives of the project. Compound 9 and Compound 7 have the same chemical formula, and both fall within the same genus of NATs. The only difference between the compounds is that Compound 9 is an RR enantiomer, and Compound 7 is an SS enantiomer. In other words, the only structural difference between the two compounds is that they each have two atomic centers that are mirror images of each other, which results in the molecules twisting in different directions.

KDI and Kent State filed a patent application for NATs, naming all the researchers on the KDI project except Falana. By the time Falana discovered he was omitted, the application had been filed as the '789 patent. When he could not obtain the consent of KDI, Kent State, and all the named inventors to add his name as an inventor on the '789 patent, Falana brought suit in the Northern District of Ohio, demanding to be added as an inventor pursuant to 35 U.S.C. § 256.

Kent State opposed the addition on multiple grounds. Kent State argued that Falana's development of the Synthesis Protocol was insufficient to make him a co-inventor of the '789 patent because the patent is directed toward the chemical compositions, and not the method by which they are created. Even though the specification of the '789 patent disclosed Falana's Synthesis Protocol as the operative method of making the claimed class of chiral compounds, the Synthesis Protocol is not claimed by the '789 patent.

To minimize the significance of the Synthesis Protocol, Kent State argued that the key steps of the protocol were known in the art, and therefore, Falana did not provide an inventive contribution. Kent State further contended that the claims do not cover the specific NAT that Falana synthesized—namely, Compound 7. In what became a somewhat self-destructive maneuver, Kent State argued that the claimed NATs should be limited to RR enantiomers that exhibit temperature independence over the full range of temperatures required by the KDI project, and also argued that the claims should be limited to Compound 9 in an effort to exclude Compound 7, the NAT that Falana first synthesized—and of which he was indisputably an inventor.

The district court agreed with Kent State that the claims should be limited to RR enantiomers, but the court refused to read the additional limitation of temperature independence from the specification into the claims. Despite Kent State's partial victory in excluding Compound 7 from the literal scope of the claims, the district court held that Falana was an inventor because he contributed to the conception of the claimed invention by developing the novel Synthesis Protocol, which was the operative method of synthesizing the claimed compounds. The district court ultimately found the case to be exceptional under 35 U.S.C. § 285 on the basis that Kent State "took an untenable position in defending this case" and continued to defend the case despite testimony that "lacked credibility." 2010 U.S. Dist. LEXIS 132486, at *56. Accordingly, Kent State was ordered to pay the attorney fees Falana incurred as a result of its actions. Id. at 58.

Kent State appealed to the Federal Circuit on the ground that the district court erred in concluding that Falana was a joint inventor of the '789 patent. The Federal Circuit framed the inventorship issue with the well-settled law that conception of a chemical compound necessarily requires knowledge of both the chemical structure of the compound and an operative method for making that compound. Falana,669 F.3d at 1358. A method of making a new compound is therefore critical to the conception of that compound, and those who contribute to that method contribute to the conception of the compound itself.

Nevertheless, the Federal Circuit noted that individuals cannot be considered joint inventors where their only contributions are within the knowledge of one of ordinary skill in the art. The contributions must be novel, but where the method requires more than the exercise of ordinary skill, the discovery of such a method is as much a contribution to the compound as the discovery of structure of the chemical compound.

The Federal Circuit cautioned, however, that the inventor of a method of making a new genus of compounds is not automatically an inventor of all members of that genus that are discovered later. Once the process becomes publicly known, it is assimilated into the body of knowledge possessed by one of ordinary skill in the art and ceases to be a novel contribution worthy of inventorship. The Federal Circuit reiterated that one who discovers a novel process is not a joint inventor of later-discovered compounds using that process without sufficient collaboration. While joint inventorship may be found even if the co-inventors did not physically work together or at the same time, joint inventorship occurs only "when the inventors have some open line of communication during or in temporal proximity to their inventive efforts." Falana,669 F.3d at 1358 (quoting Eli Lilly & Co. v. Aradigm Corp., 376 F.3d 1352, 1359 (Fed. Cir. 2004)).

In affirming the district court's ruling that Falana was a co-inventor, the Federal Circuit found that Falana's Synthesis Protocol was novel. The court also found that the Synthesis Protocol made possible the creation of a previously unknown class of the NATs chemical compounds. The method Falana used to synthesize Compound 7 was the same method Seed used to synthesize Compound 9 and is the only method disclosed in the '789 patent for making the claimed compounds. It was not dispositive for the Federal Circuit that Falana had left KDI before the claimed compounds were first synthesized. "Falana's lack of contribution to the discovery of Compound 9 itself does not negate his contribution of the method used by the other inventors to make the genus of compounds covered by the claims at issue." Falana, 669 F.3d at 1359. Falana's Synthesis Protocol was necessary to enable one to make the claimed compounds, and just as important, the protocol was novel in and of itself.

The Federal Circuit also agreed with the district court's refusal to read into the claims a limitation regarding temperature independence, though it is apparent that the district court's claim construction was not outcome-determinative. Given the reasoning of the Federal Circuit, Kent State still would not have been able to defeat Falana's inventorship claim even if the courts had adopted Kent State's request to further limit the scope of the claims. Conception of a patented compound requires knowledge of chemical structure and the operative method of making it, but it does not require knowledge of the effective properties of that compound. Kent State successfully excluded Compound 7—the only NAT Falana synthesized—from the claims of the '789 patent, yet both the district court and the Federal Circuit found Falana's contribution sufficient to establish inventorship. Further limitation of the scope of the claims of the '789 patent would have been to Kent State's detriment.

Since Falana, the issue of joint inventorship for chemical compounds has arisen in at least two published opinions. First, in Brigham Young Univ. v. Pfizer, Inc., Case no. 2:06-cv-890 TS, 2012 U.S. Dist. LEXIS 39636 (D. Utah Mar. 22, 2012), the U.S. District Court of Utah denied Pfizer's motion for summary judgment, which allowed Brigham Young University to proceed with action to include a BYU professor as a joint inventor on several of Pfizer's COX-2 inhibitor patents. The professor developed a novel method for testing existing compounds for COX-2 selectivity and shared the method with Pfizer, which used that method to develop a series of patents related to COX-2 inhibition—all of which claimed a COX-2 inhibitor. The district court found the professor's method of testing for COX-2 selectivity to be a material contribution to the claims, and therefore denied Pfizer's motion for summary judgment. Interpreting Falana, the court stated: "[A]n inventor of a method may be entitled to joint inventorship on a patent that discloses only compounds if (1) the plaintiff conceived of a method; (2) that is outside the exercise of ordinary skill; and (3) is in fact used to create the compound in the patent." BYU, 2012 U.S. Dist. LEXIS 39636, at *7.

The district court also rejected Pfizer's argument that the method of synthesizing the claimed compound in Falana was materially distinct from the BYU professor's method of testing compounds. The Utah district court reasoned that the BYU professor's "contribution would have the same effect in the end: providing the capability to develop COX-2 selective NSAIDs." BYU, 2012 U.S. Dist. LEXIS 39636, at *8 n.23. The Utah district court's reasoning, however, arguably extended from the underlying principle of Falana that conception of a chemical compound requires a method of making the compound. The District of Utah found that the professor may be an inventor because he developed an operative method of testing the compound.

Unlike Falana, the BYU professor's method was not necessary to synthesize the claimed compounds—it was only needed to test the efficacy of compounds synthesized by other processes. While methods of testing the efficacy of new compounds can be just as important as the methods by which those compounds are created from a practical perspective, courts and attorneys should be mindful of this distinction in analyzing inventorship in both patent prosecution and litigation.

In Schering Corp. v. Mylan Pharms, Inc., Civ. Action No. 9-6383 (JLL), 2012 U.S. Dist. LEXIS 59160 (D.N.J. April 27, 2012), the U.S. District Court of New Jersey focused on the novelty of the method at issue. The Schering court held that a scientist who was the first to create new compounds was not an inventor of similar compounds because the method he used to synthesize them was known in the art. The chemical structure of the claimed compounds was first conceived by others. While the scientist in Schering was the first to synthesize these compounds, he did so by using methods known in the art.

The district court also found that the claims did not cover the actual compounds the scientist synthesized—the claims were directed to similar compounds, and thus the scientist's contributions were too far removed from the claims at issue. While the court's Schering decision rested on multiple grounds, the focus on the novelty of the putative inventor's contribution serves as useful guidance in future inventorship disputes. A non-novel contribution to the elements of conception does not give rise to inventorship.

In the wake of Falana, practitioners should consider the contributions of all individuals to the creation of novel chemical compounds, and not only the individuals who synthesize the compounds actually claimed. Prosecutors should ensure that they fully investigate the methods and processes used to synthesize new compounds and determine whether those processes are known in the art. If the processes are not known, prosecuting attorneys must consider whether it would be appropriate to list the inventors of those processes on new patent applications.

When questions arise regarding a pending application or an issued patent, portfolio managers should audit their portfolios to determine whether corrective action should be taken. Inventorship may be corrected pursuant to 35 U.S.C. § 116 before the patent issues, or pursuant to 35 U.S.C. § 256 after issuance, with the consent of all presently listed inventors and all current assignees. If one of these parties objects to correction, inventorship can be corrected either through reissue or through an action in a federal district court, depending on which party objects. Section 256 can also be invoked by the patentee if the problem with inventorship comes to light for the first time in a declaratory judgment or infringement action. In litigation, both the patentees and infringement defendants should investigate whether the inventorship of an asserted patent is accurate. If it is not, the first side to unearth the issue may ultimately gain the upper hand.

Falana also highlights the practical importance of obtaining proper assignments in the wake of Stanford v. Roche, 131 S. Ct. 2188, 563 U.S. (2011). If Falana had signed an effective assignment contract, there likely would have been little reason for Kent State not to agree to list him as an inventor. It appears, however, that one concern Kent State had in adding Falana was his ability to practice and license the technology, because no assignment contract existed. An effective assignment from Falana to Kent State might have obviated protracted litigation in which Kent State sought to narrow its claims and ultimately incurred sanctions.

When defending against challenges to inventorship, parties must remain aware of how arguments regarding inventorship will affect a patentee's ability to enforce the patent at issue. Kent State's arguments with respect to the Synthesis Protocol being known in the art could provide fodder for future invalidity challenges to the '789 patent. Additionally, its claim construction positions in Falana might significantly narrow the scope of the '789 patent's claims. To the extent that Kent State effectively dedicated Compound 7 to the public by opposing Falana's claim to inventorship, the school would most likely be estopped from arguing any claim construction that includes Compound 7 within the scope of the '789 patent.

Another potential consequence of Falana is that an individual might qualify as an inventor by preparing an intermediary compound that can be converted to a novel compound through technology known in the art. In such circumstances, the putative inventor's contribution of creating a novel synthesis of an intermediary may be equivalent to creating an operative method of making the claimed compound. Under the reasoning in Falana, the person synthesizing the intermediary might be an inventor of the claimed compound even if that person did not actually make the claimed compound.

Although the Federal Circuit decision in Falana v. Kent State begins to clarify the murky waters of who is the inventor of a chemical compound, the decision also highlights the depth of analysis that is necessary for patent applicants, patent practitioners, and the courts in assessing inventorship. The focus of any such assessment must extend beyond the conception of the compound itself to include the process by which that compound is manufactured.

Keywords: litigation, intellectual property, inventorship

Copyright © 2012, American Bar Association. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or downloaded or stored in an electronic database or retrieval system without the express written consent of the American Bar Association. The views expressed in this article are those of the author(s) and do not necessarily reflect the positions or policies of the American Bar Association, the Section of Litigation, this committee, or the employer(s) of the author(s).