Federal Circuit resolves conflicting standards for infringement of product-by-process patent claims

The Federal Circuit recently issued an opinion stating that infringement of a “product-by-process” patent claim requires a showing that the claimed process was used in manufacturing the alleged infringer’s product.  The new decision,  Abbott Laboratories v. Sandoz, Inc., (Fed. Cir. 5/18/09) resolved a split in Federal Circuit panel decisions that have been in place since the early 1990’s.

A product-by-process patent claim is one that describes a product by the way that it is manufactured, rather than by its physical or chemical characteristics.  For example, the claims at issue in the Abbott Laboratories  case involved U.S. Patent 4,935,507.  In the ‘507 patent, claim 2 was a product-by-process claim directed to a crystalline substance “which is obtainable by acidifying a solution containing 7-[2-(2-aminothiazol-4-yl)-2-hydroxyiminoacetamido]-3-vinyl-3-cephem-4-carboxylic acid (syn isomer) at room temperature or under warming.”   As noted by the Court, product-by-process claims are typically used when the structure of the resulting product is not fully known.

The proper scope of a product-by-process claim has been questioned since the early 1990’s.  In 1991, a Federal Circuit panel ruled that the process steps in a product-by-process claim “serve as limitations in determining infringement.”  See Atlantic Thermoplastics Co. v. Faytex Corp., 970 F.2d 834, 23 USPQ2d 1481 (Fed. Cir. 1992).  However, in 1991 a different Federal Circuit panel ruled that “[t]he correct reading of product-by-process claims is that they are not limited to the product prepared by the process set forth in the claims.”  Scripps Clinic & Research Foundation v. Genentech, Inc., 927 F.2d 1565, 18 USPQ2d 1001 (Fed. Cir. 1991). 

In the new decision, the Federal Circuit held en banc that the Atlantic Thermoplastic rule will apply going forward by stating:  “process terms in product-by-process claims serve as limitations in determining infringement.”  The Court emphasized that “the process terms limit product-by-process claims” and thus overruled the relevant portions of the 1991 Scripps opinion.

In dissent, Judge Newman, who authored the Scripps opinion, asserted that the en banc decision creates a a standard for infringement of a product-by-process claim that is “directly contrary to the treatment of such claims for years by the PTO.”  Judge Newman noted that the PTO has been following Court precedent which held that a patent claim cannot cover an “old product made by a different process.”

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