Utility and Inoperable Species

Merck & Co Inc. v. Apotex Inc. / lovastatin 2010 FC 1265, Snider J

Claim 1 of the patent at issue in the lovastatin case (#1,161,380) related to a specified compound produced by the microorganism A. terreus. It was established [492] that not all stains of A terreus would produce the product in question. Apotex argued that the claim was therefore invalid for lack of utility [492]. Snider J rejected this argument on the basis that the claims, properly construed, included only those strains capable of producing lovastatin [494], [110]-[121].

This raises two questions. The most obvious is as to whether Snider J’s construction of the claim was sound, particularly because neither claim 1 nor the specification explicitly states that the '380 Patent excludes non-producing strains of A. terreus [111]. In other words, is it permissible to read in an operability limitation?

The more fundamental question concerns the underlying rule of law respecting utility. It is now routine in Canadian law to say that a claim lacks utility if “[t]here is evidence of lack of utility in respect of some of the area covered” by the claim [495], quoting Wellcome / AZT 2002 SCC 77 [56]. This rule can operate harshly. If an inventor discovers a new class of compounds that are generally useful, for example in treating a deadly disease, this rule implies that even if a single compound within that class does not have the promised utility, the claim is invalid, even though a person skilled in the art would have no difficulty identifying the inoperative species. This consequence may be avoided if the claims are construed to exclude inoperable species, as in Snider J’s lovastatin decision, but the claim construction issue cannot be properly understood without casting a critical eye on the underlying utility doctrine.

To begin, we should recognize that the utility doctrine has two distinct functional roles in Canadian law. One is to control how far ‘upstream’ in the innovation process a patent may be granted. How close to practical application does an innovation have to be before it may be patented? This is governed by the doctrine of sound prediction in Canada. This is independent of any concern of the breadth of the claim, as it may arise in respect of a claim to a single compound, as in Wellcome / AZT. That question is also governed by utility doctrine in US law, under the rubric of “specific, practical and credible” utility, following Brenner v Manson 383 US 519 (and see e.g  In re Brana, 51 F3d 1560, 1567 (Fed Cir 1995)). In the UK it is an aspect of industrial applicability, the requirement which superceded utility in the 1977 Act: see Eli Lilly and Company v. Human Genome Sciences, Inc. [2008] RPC 29, [2008] EWHC 1903 (Pat), [178]-[227]. (Note that while the doctrine of sound prediction comes to us from English law, it is no longer good law there: see Dr Reddy's Laboratories (UK) Ltd v Eli Lilly & Company Ltd [2009] EWCA Civ 1362 [2010] RPC 9, esp. [39]. Nonetheless, industrial applicability fills the same function in this particular respect.)

The second role is in governing the scope of the claim. If at least some of the substances, particularly those which are specifically identified, deliver an immediate practical benefit, then there can be no objection that patenting is premature. In that case the rule that claim is invalid if any embodiments do not deliver the promised utility serves to control the scope of what may be claimed. (It might be said that I am drawing a false distinction, because the requirement is that the claimed invention deliver a practical benefit across the entire breadth of the claim. This objection confuses the legal rule with its function.) In respect of this second function, Canadian law is anomalous. Neither US nor European law uses the utility doctrine to control the scope of the claim. In US law utility need not be shown across the entire scope of the claims; it is enough that there is some embodiment within the claims that has utility: “the defense of non-utility cannot be sustained without proof of total incapacity.”1 In contrast to Canadian law, where it is, in principle, enough to show that one embodiment within the claim lacks utility, in the US “ the party alleging inoperability must show that each disclosed embodiment in the patents was impossible or not enabled.”2

The UK did at one time have the same rule as Canada. (It should be no surprise that we adopted this rule from English law.) But utility requirement was removed entirely 1977 Patent Act, and this rule went with it: see Pharmacia Corp v v Merck & Co, Inc, [2001] EWCA Civ 1610 [54]. The primary purpose of the 1977 Act was to implement the European Patent Convention, but abolition of the rule requiring utility across the entire claim had already been recommended in the purely domestic context. The 1971 Banks Report, which comprehensively reviewed the UK patent system, recommended at [376] replacing the traditional rule with a rule equivalent to the US position, that lack of utility should be a ground for invalidity “only if the invention claimed covers no useful embodiment.” The reasons given were that “this provision is not included in the laws of the principal patenting countries (excluding those based on the British system) and also that it can bear harshly in those cases where a claim of a patent can be interpreted to cover something that lacks utility as well as things that certainly possess it.” The rule was in any event in decline before then: see Henriksen v Tallon Ltd [1965] RPC 434 (HL).

Both US and English law deal with the problem of inoperable species in terms of insufficiency or overbreadth. In US law, if a person of skill in the art cannot determine which embodiments are inoperative without undue experimentation, the claims will be invalid for lack of enabling disclosure: see MPEP 2164.08. This is exactly the test applied by Snider J in the lovastatin decision [120], except that she did so in the context of claims construction. English law remains somewhat uncertain as the implications of Biogen v Medeva continue to play themselves out (see Terrell on Patents, 17th ed,  13-15), but the question is clearly one of sufficiency, and the effect of inoperable species remains "an open question": Ranbaxy v Warner-Lambert [2007] RPC 4, [2006] EWCA Civ 876 [51].

The US and European experience suggests that Canadian law could do away with the rule that an inoperable species invalidates a claim without functionally impairing the ability of the law to govern claim breadth. Conceptually, the advantage to doing so is clear: there is simply no justification in policy for holding a patent over a valuable invention to be invalid simply because a single embodiment lacks utility, even though that is easily determined and no one was ever misled. That is technical legalism of the worst sort. Moreover, the question of the proper scope of the claim is inherently difficult. There is no need to make the problem more complex by dividing the analysis between different doctrines. The immediate practical implication of the US approach is that the question of whether the claims, properly construed, encompass inoperable species, becomes largely irrelevant.

While it is now commonplace to say that a claim is invalid if “[t]ere is evidence of lack of utility in respect of some of the area covered,” in practice the actual application of the rule is often avoided by careful claims construction, as in the lovastatin decision. In most decisions where this statement is repeated, it is dicta in case which was decided or is explicable on other grounds. The Supreme Court’s statement in  Wellcome / AZT was dicta, as the case was decided on the basis of sound prediction. Similarly, 2008 FC 825, 2009 FC 638, 2005 FC 1332 and 2006 FCA 64, to cite a few recent cases re-iterating the same statement, were also all based on sound prediction. Perhaps the seminal case establishing the rule, the decision of Jenkins J in Re May & Baker Ltd. v. Boots Pure Drugs Co. Ltd., (1948) 65 RPC 255 (Ch.), was a classic case of overbreadth, decided in is readily explained on the basis of insufficiency overbreadth. The claim in question covered over 97,000,000 compounds, and it was in effect conceded that this was too broad. The real question in the case, and the only one addressed by the CA and HL, was whether a narrowing amendment to claim only two compounds would be permitted (it was not). The relevant statement in Olin Mathieson Corporation v. Biorex Laboratories Ltd. [1970] RPC 157, another English case sometimes relied on in Canada, was dicta, as the real attack was again on the basis of overbreadth, and on the facts, the claim was upheld.

Turning to the leading Canadian cases, Commissioner of Patents v. Ciba  [1959] SCR 378, 19 Fox Pat. C. 18, 30 CPR 135, 18 DLR (2d) 375, notes May & Baker in passing, without approving or disapproving, but the decision itself has nothing to do with this issue (the question is whether a person can claim the standard process for making new compounds, as well as the compounds themselves). Hoechst Pharmaceuticals of Canada Ltd. v. Gilbert & Co., [1966] S.C.R. 189, 50 C.P.R. 26, 32 Fox Pat. C. 56 was a case of overbreadth. Sandoz Patents Ltd. v. Gilcross Ltd. [1974] SCR 1336 deals with insufficiency, and the patent was upheld precisely because a person skilled in the art would have known how to avoid the inoperable embodiments. This, if anything, is authority against the rule that the claims must be operable across their full scope. Monsanto Co. v. Canada (Commissioner of Patents) [1979] 2 SCR 1108, 42 CPR (2d) 161 repeated the statement that inoperable species will invalidate a claim, but the decision is the original SCC case on sound prediction, and the patent was upheld.

It must be acknowledged that not all the cases can be so readily explained. Minerals Separation North American Corp. v. Noranda Mines Ltd. (1952) 69 RPC 81 (J.C.P.C.) affm’g [1950] SCR 36(SCC) and Société des Usines Chimiques Rhone-Poulenc v. Jules R. Gilbert Ltd [1968] SCR 950, both hold claims invalid for encompassing inoperable species on facts in which it appears that a person skilled in the art would have been able to identify the inoperable species without undue experimentation. Thus it does appear that Canadian law will be burdened with this rule until the SCC chooses to revisit it. However, I do suggest that we should recognize that the rule is anomalous in law and unjustifiable in policy. It is time to stop the boilerplate repetition of the ‘rule’ that a claim lacks utility if “[t]ere is evidence of lack of utility in respect of some of the area covered.”

I will end this overly long post with a passage from the old case of  Haworth v. Hardcastle, (1834) 131 Eng. Rep. 1087, 1090 (CP), Tindal CJ: 

"After stating that the machine was useful on the whole, the expression that, in some cases, it is not useful to take up the cloths, appears to us to lead rather to the inference that, in the generality of cases, it is found useful. And if the jury think it useful in the general, because some cases occur in which it does not answer, we think it would be much too strong a conclusion to hold the patent void."



1 E.I. du Pont de Nemours & Co. v. Berkley and Co., 620 F.2d 1247, 1260, fn. 17 (8th Cir.1980).

2 EMI Group North America, Inc. v. Cypress Semiconductor Corp., 268 F.3d 1342 at 1349 (Fed Cir 2001), emphasis added.