Claim Construction Deference: The Paradigm Shifts
In a win for Teva Pharmaceuticals, the U.S. Supreme Court abandoned the Federal Circuit's long established rule that the patent claim construction rulings of trial courts are not to be accorded any deference upon appeal. On January 20, 2015, the Court held in Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc. that to the extent these decisions are based on factual findings, such findings should only be overruled upon a showing of clear error. This marks a sizeable shift that should provide a bit more certainty for successful parties on appeal.
Teva asserted its patent covering a process to manufacture the drug Copaxone used to treat multiple sclerosis. The active ingredient in Copaxone is comprised of molecules of various size and weight. In this regard, the asserted claims defined the main component as having a "molecular weight of 5 to 9 kilodaltons." Sandoz contended that Teva’s patent was invalid as the term "molecular weight" was indefinite. The trial court, however, held that the term was “sufficiently definite,” reasoning that a person knowledgeable in this particular area would be able to understand the term as denoting “peak average molecular weight.” On appeal, the Federal Circuit reviewed de novo all facets of the trial court's claim construction and incorporated its own determination of certain facts to find the claim indefinite.
In the 7-2 decision written by Justice Stephen Breyer, the Supreme Court concluded that district court claim construction rulings regarding factual findings should be reviewed on appeal for clear error, rather than de novo. The court noted that clear error review is necessary when factual findings are at issue as patent law is an area of the law where much is dependent upon “familiarity with specific scientific problems and principles not usually contained in the general storehouse of knowledge and experience.”
The Court further explained that, "[a] district court judge who has presided over, and listened to, the entirety of a proceeding has a comparatively greater opportunity to gain that familiarity than an appeals court judge who must read a written transcript or perhaps just those portions to which the parties have referred.” The Federal Circuit's standard, the Court held, seems to run afoul to Rule 52(a) of the Federal Rules of Civil Procedure, which asserts that findings of fact must not be set aside on appeal unless clearly erroneous.
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