Danisco U.S. Inc. v. Novozymes A/S

744 F.3d 1325, 109 U.S.P.Q. 2d (BNA) 2128, 2014 WL 929348, 2014 U.S. App. LEXIS 4457
CourtCourt of Appeals for the Federal Circuit
DecidedMarch 11, 2014
Docket2013-1214
StatusPublished
Cited by22 cases

This text of 744 F.3d 1325 (Danisco U.S. Inc. v. Novozymes A/S) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Danisco U.S. Inc. v. Novozymes A/S, 744 F.3d 1325, 109 U.S.P.Q. 2d (BNA) 2128, 2014 WL 929348, 2014 U.S. App. LEXIS 4457 (Fed. Cir. 2014).

Opinion

LOURIE, Circuit Judge.

Danisco U.S. Inc. (“Danisco”) appeals from the decision of the United States District Court for the Northern District of California dismissing Danisco’s declaratory judgment action against Novozymes A/S and Novozymes North America, Inc. (collectively “Novozymes”) for lack of subject matter jurisdiction. See Danisco U.S. Inc. v. Novozymes A/S, No. 12-4502, 2013 WL 2351723 (N.D.Cal. Jan. 8, 2013) (unpublished). Because we conclude that the totality of the circumstances establishes a justiciable controversy, we reverse and remand.

BACKGROUND

Danisco and Novozymes compete to develop and supply Rapid Starch Liquefaction (“RSL”) products, which are genetically modified industrial enzymes used for converting corn and other plant-based material into ethanol. Danisco and Novo-zymes have patents that claim a-amylase enzymes, which have been genetically engineered through substitution of amino acids in the peptide sequence in order to improve their performance in the liquefaction process.

Since about 2001, Novozymes has sued Danisco or Danisco’s predecessors in interest for infringement numerous times. In one instance, Novozymes amended an application then pending at the United States Patent and Trademark Office (“PTO”) to claim one of Danisco’s new products and then sued Danisco in the United States District Court for the Western District of Wisconsin on the same day that the patent issued. The Wisconsin court invalidated Novozymes’s patent because the newly added claim was not supported by the written description, and we affirmed. Novozymes A/S v. DuPont Nutrition Biosciences APS, 723 F.3d 1336, 1346 (Fed.Cir.2013).

Danisco owns U.S. Patent 8,084,240 (the “'240 patent”), issued December 27, 2011 and claiming the benefit of priority from a provisional application filed June 6, 2008. The '240 patent claims a truncated Geoba-cillus stearothermophilus (“BSG”) a-amylase variant polypeptide with a substitution from glutamic acid (“E”) to proline (“P”) at sequence position 188, a so-called “E188P substitution,” that exhibits increased viscosity reduction in a starch liquefaction assay compared to the parental a-amylase polypeptide. '240 patent col. 275 1. 25-col. 276 1. 29. The claimed enzyme is the active ingredient in Danisco’s RSL products.

*1328 Shortly after the PTO issued a Notice of Allowance of the application that matured into Danisco’s '240 patent, Novozymes again amended one of its own then-pending patent applications to claim a BSG a-amylase variant polypeptide with an E188P substitution, and subsequently requested an interference contesting entitlement to priority of the invention. J.A. 445-53. Specifically, Novozymes asserted that its amended claim encompassed the same invention as Danisco’s claim because both claims: (i) are directed to an isolated BSG a-amylase variant, (ii) specify 99% sequence identity to the parental enzyme, and (iii) require the same E188P substitution. Id. at 448. In other words, Novo-zymes contended that its amended claim covered the same invention as Danisco’s '240 patent, namely a BSG a-amylase variant with an E188P mutation, which is the active ingredient in Danisco’s RSL products. The PTO examiner rejected Novo-zymes’s interference request on the ground that the truncated BSG a-amylase variant in Danisco’s then-pending claim did not meet the specific sequence identity limitations of Novozymes’s amended claim. Id. at 449-50.

After Danisco’s '240 patent issued, No-vozymes filed a request for continued examination, challenging the examiner’s conclusions and again arguing for priority over what it described as Danisco’s “interfering '240 patent.” Id. at 457, 462. No-vozymes maintained that Danisco’s '240 patent covered the same subject matter as Novozymes’s amended claim and, in effect, once more represented that its amended claim read on the active ingredient in Dan-isco’s RSL products. Id. Novozymes asserted that the examiner had “mistakenly concluded” that Danisco’s '240 patent directed to a BSG E188P mutation “d[id] not fall within the scope of’ Novozymes’s then-pending application. Id. The examiner rejected Novozymes’s request. Id. at 461-67.

Although under no regulatory obligation to do so, Novozymes then submitted public comments to the PTO “in order to clarify [for] the record” its belief that the a-amylase variant claimed by Danisco’s '240 patent “fall[s] within the scope” of its own claim, which later issued to Novozymes as the sole claim of U.S. Patent 8,252,573 (the “'573 patent”) on August 28, 2012, claiming the benefit of priority from a provisional application filed June 7, 2001. Id. at 456-59. Novozymes further commented that it refused to “acquiesce” to or otherwise be “estopped” by what it deemed to be the examiner’s erroneous and “overly narrow” view of Novozymes’s claim scope, which consequently did not allow Novozymes to invalidate Danisco’s '240 patent or to claim priority over the ownership of the BSG E188P a-amylase variant invention. Id.

Upon issuance of Novozymes’s '573 patent, Danisco filed concurrent actions in the United States District Courts for both the Northern District of Iowa and the Northern District of California seeking declaratory judgments that its RSL products did not infringe Novozymes’s '573 patent (Count 1) and that the '573 patent was invalid (Count 2), or alternatively that Danisco’s '240 patent had priority over Novozymes’s '573 patent pursuant to 35 U.S.C. § 291 (Count 3). J.A. 259-63, 728-32. Following the parties’ stipulated dismissal of the Iowa action in favor of the California action, Novozymes moved to dismiss Danisco’s complaint for lack of jurisdiction under Federal Rule of Civil Procedure 12(b)(1) and for failure to state a claim under Rule 12(b)(6). J.A. 468-84, 735-36.

The district court granted Novozymes’s motion and dismissed Danisco’s declaratory judgment claims, holding as a matter of law that the facts as alleged did not create *1329 a justiciable Article III case or controversy as to Counts 1 and 2. Danisco, 2013 WL 2351723, at *2. The court acknowledged that Novozymes’s '573 patent presented a substantial risk to Danisco, but found that a justiciable controversy did not exist because Danisco had challenged Novozymes’s '573 patent on the day that it issued, and thus that Danisco’s action “was filed prior to the time Novozymes took, or even could have taken, any affirmative action to enforce its patent rights.” Id. at *1. The court stated that “[w]hile matters such as a prior litigation history and statements made during prosecutions sometimes support a conclusion that an actual controversy exists, there is no precedent for finding jurisdiction based on such pre-patent issuance events alone....” Id. at *2 (emphasis in original). The court determined that Danisco was missing “an affirmative act of enforcement” or “some implied or express enforcement threat” by Novozymes because “pre-issuance conduct” could not satisfy that requirement. Id. at *3-4.

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744 F.3d 1325, 109 U.S.P.Q. 2d (BNA) 2128, 2014 WL 929348, 2014 U.S. App. LEXIS 4457, Counsel Stack Legal Research, https://law.counselstack.com/opinion/danisco-us-inc-v-novozymes-as-cafc-2014.