[00:00:03] Speaker 03:
We want to be ready, Ms.

[00:00:04] Speaker 03:
Green.

[00:00:04] Speaker 04:
Good morning, Chief Judge, Your Honors.

[00:00:13] Speaker 04:
May it please the Court?

[00:00:14] Speaker 04:
As Your Honors are aware, there are many different issues that are raised by the parties in the Appeal and Cross Appeal.

[00:00:19] Speaker 04:
And I'd like to begin by addressing the validity of Claim 12, the 913 patent, and then to move on to the issue of the reduced infringement claim with respect to the 450 patent family.

[00:00:30] Speaker 04:
And then finally, finished with the consisting essentially of finding by the district court of indefiniteness, unless your honors prefer that I address the issues in a different order.

[00:00:44] Speaker 04:
Your honors, we request this court affirm the district court's finding of validity of claim 12 of the 913 patent.

[00:00:52] Speaker 02:
Just as a threshold question,

[00:00:55] Speaker 02:
Would you agree that the issues concerning impurity A, the formulation degrades by less than 1% over six months and consists essentially of that they rise and fall together?

[00:01:07] Speaker 04:
No, Your Honor, we would not agree with that.

[00:01:10] Speaker 04:
There are a lot of different issues that are packed in together there.

[00:01:13] Speaker 04:
There was a claim term at issue that recited a degrades claim term.

[00:01:17] Speaker 04:
There's also a separate claim term to impurity A. Those are actual terms of the claim.

[00:01:22] Speaker 04:
the consisting essentially of argument relates to the basic and novel properties.

[00:01:26] Speaker 04:
And we view those as a separate argument, although the district court judge did, in our view, improperly import the discussion of the claim construction analysis and definiteness into the assessment of the definiteness of basic and novel properties.

[00:01:41] Speaker 02:
But if the impurity is indefinite, then how can degration be definite?

[00:01:50] Speaker 04:
It depends, Your Honor, on what aspect of degradation we're looking at.

[00:01:54] Speaker 04:
If degradation is a claim term, then that's a separate analysis, in our view, from assessing improved stability, which the district court identified as a basic and novel property.

[00:02:03] Speaker 02:
But if you can't show in QDA, how can you show that there's been a degradation?

[00:02:09] Speaker 04:
Well, in the context of basic and novel property, that relates to a factual inquiry concerning infringement.

[00:02:15] Speaker 04:
The basic and novel properties are identified to aid the fact finder

[00:02:18] Speaker 04:
and considering this hypothetical infringement question where you have a composition which is the claimed composition that includes some additional component.

[00:02:26] Speaker 04:
So the basic novel properties are set forth so that the fact finder can evaluate whether that additional component affects that, materially affects that property.

[00:02:36] Speaker 04:
So that's really an assessment of similarity.

[00:02:39] Speaker 04:
This is not subject to the same kind of objective requirement that you have

[00:02:43] Speaker 04:
you know, it's not a claim term that requires an objective means of evaluating because it's a very different type of analysis.

[00:02:51] Speaker 04:
Basic analog properties are not part of the claim language.

[00:02:55] Speaker 04:
They are simply identified based on the intrinsic evidence to assist the fact finder in evaluating the factual question of infringement.

[00:03:04] Speaker 04:
So it's our position that, in this case, the district court erred because he blurred the line between the factual inquiry

[00:03:11] Speaker 04:
which relates to the basic and novel properties and the legal question of determining the scope of the claim.

[00:03:17] Speaker 04:
He properly recognized consisting essentially of as a legal term of art.

[00:03:21] Speaker 04:
He recognized that since the parties disputed the identification of the basic and novel properties that he needed to go and look at the intrinsic record and as a matter of law determine what were the basic and novel properties.

[00:03:33] Speaker 04:
that this court has never held that it's appropriate to consider definiteness of the basic and novel properties.

[00:03:39] Speaker 03:
Well, we haven't held either way.

[00:03:40] Speaker 03:
So maybe it's just a new question.

[00:03:42] Speaker 03:
We haven't held to the contrary, right?

[00:03:44] Speaker 04:
That's correct, Your Honor.

[00:03:45] Speaker 04:
This question is a case of first impression that has not come to this court.

[00:03:49] Speaker 03:
Aren't basic and novel properties part of claim scope?

[00:03:52] Speaker 04:
I disagree, Your Honor.

[00:03:53] Speaker 04:
The basic and novel property has come out of the patent examination group originally.

[00:03:58] Speaker 04:
It was brought in by the CCPA.

[00:04:00] Speaker 04:
simply as a tool to be used in the context of the factual question.

[00:04:05] Speaker 04:
And this court in the PPG case recognized that there is a line that should be maintained.

[00:04:10] Speaker 03:
What factual question?

[00:04:11] Speaker 04:
We're talking about what the claim says and what it covers.

[00:04:14] Speaker 04:
Well, the basic and novel properties are to be used to assess in this specific factual question where you have a composition in this case which would meet all of the limitations of the claim but contain one additional component.

[00:04:26] Speaker 04:
And then it's a factual question whether the

[00:04:31] Speaker 04:
the existence of this additional component would materially affect that basic and novel property.

[00:04:37] Speaker 04:
There's no absolute value that's to be targeted here.

[00:04:40] Speaker 04:
It's a question of similarity.

[00:04:42] Speaker 04:
That's something for the fact finder to determine

[00:04:45] Speaker 04:
whether the party who is advancing that information has met their burden of proof.

[00:04:50] Speaker 02:
How can we tell as to the formulation of the PADS?

[00:04:55] Speaker 02:
It doesn't seem to me that there's no guidance in the specification to reduce the number of basic and novel properties that are recited.

[00:05:07] Speaker 04:
I'm sorry, Your Honor, I didn't understand your question.

[00:05:09] Speaker 02:
The formulation adds that you cite a multitude of properties.

[00:05:12] Speaker 04:
That's correct, Your Honor.

[00:05:13] Speaker 02:
Okay, and then you want to show, I need to have some guidance, I need to see some guidance as to which one of the multitude are the basic and all the properties.

[00:05:25] Speaker 04:
Well, the district court properly found, based on the intrinsic record, that there were several different properties that the inventors identified clearly in their specification

[00:05:33] Speaker 04:
as those properties which distinguish the invention from the prior art.

[00:05:38] Speaker 04:
I mean, I realize, and after this is brief, they argue there are other properties that were discussed in the intrinsic record.

[00:05:44] Speaker 04:
But we submit there's a clear distinction between those properties which the inventor set out as being the basic properties which differentiated the invention from the prior art, and then other properties which could flow from those.

[00:05:58] Speaker 02:
I don't see that distinction in the pen.

[00:06:00] Speaker 04:
Well, for example, Your Honor, one of the basic and novel properties the Court found is improved or higher viscosity.

[00:06:08] Speaker 04:
And then there's some other properties relating to ease of spreadability.

[00:06:11] Speaker 04:
That's a property that flows from the basic and novel property of the higher viscosity.

[00:06:18] Speaker 04:
And that's the case for many of the additional properties that activists in this brief suggest should also be considered basic and novel properties.

[00:06:25] Speaker 04:
that there's no error in the court's evaluation of what are the basic and novel properties because the specification quite clearly identifies them, those properties, as being the ones that constitute the improvement of the invention as compared to the prior comparative liquid composition.

[00:06:44] Speaker 03:
Wait, so there are three indefinite terms here, so maybe I'm confusing the two, but what the district court said was

[00:06:52] Speaker 03:
that the basic novel properties were not, they didn't meet the novelist test because the better drying time was also an indefinite term?

[00:07:01] Speaker 04:
That's correct, Your Honor.

[00:07:03] Speaker 04:
The district court, in our view, improperly found that the better drying time term was indefinite in large part because the district court... Was indefinite or definite?

[00:07:11] Speaker 04:
Was indefinite, not definite, because the district court, without actually ever receiving any argument or testimony on the question of that as a basic and novel property,

[00:07:21] Speaker 04:
The district court improperly looked at evidence submitted to the court in the context of claim construction, not relating to the basic and novel property of drying time, but relating to the claim term of drying rate.

[00:07:34] Speaker 04:
And that was error for the district court to try to rely on arguments and information concerning drying rate to support a finding that

[00:07:43] Speaker 04:
improved drying time as a basic and novel property.

[00:07:46] Speaker 03:
OK, we've got so many tears here.

[00:07:47] Speaker 03:
I'm getting very confused.

[00:07:50] Speaker 03:
The district court found that consisting essentially of was indefinite.

[00:07:54] Speaker 03:
What is your main argument as to his conclusion?

[00:07:58] Speaker 04:
So there are multiple levels, because there's so many issues.

[00:08:01] Speaker 04:
But the main argument is that it was improper to even subject the basic and novel properties to the requirements of Section 112, second paragraph.

[00:08:09] Speaker 03:
How was he to construe them, consisting essentially of?

[00:08:12] Speaker 04:
Well, consisting essentially of it's been well accepted as a legal term of art which has an accepted meaning and to the extent that it includes all the recited elements and can permit the inclusion of additional elements which do not materially affect the basic and novel properties.

[00:08:27] Speaker 03:
So as part of his claim construction, he had to find out whether or not it affects the basic novel properties?

[00:08:34] Speaker 04:
No, Your Honor.

[00:08:35] Speaker 04:
We submit that that is a factual question.

[00:08:37] Speaker 04:
And the irony is that, in this case, that factual question was never raised but for the district court judge, because in this case, activists' formulation did not contain any additional ingredients.

[00:08:48] Speaker 04:
It included all of the recited components and no more.

[00:08:51] Speaker 04:
So that's part of the problem here, is that activists raised this not because they had trouble knowing whether or not they infringed the claim, but because they saw this as an avenue to try to invalidate the claim.

[00:09:04] Speaker 04:
And that was the error.

[00:09:05] Speaker 03:
You've got to take responsibility for your own claim.

[00:09:08] Speaker 03:
And it doesn't say consisting of.

[00:09:10] Speaker 03:
It says consisting essentially of.

[00:09:12] Speaker 03:
And the district court is obligated to do a claim construction of that, right?

[00:09:16] Speaker 04:
That's correct.

[00:09:16] Speaker 04:
And the district court did properly recognize it as a legal term of art.

[00:09:19] Speaker 04:
And because the parties did not agree on the identification of the basic novel properties consistent with this court's precedent, it was appropriate

[00:09:26] Speaker 04:
that the district court identified those basic and novel properties so that there was no confusion about what are the properties that should be evaluated in that factual context.

[00:09:35] Speaker 03:
And did we all agree?

[00:09:36] Speaker 03:
Did everyone agree that better drying time is one of the basic novel properties?

[00:09:39] Speaker 04:
Well, Your Honor, I believe activists disputes that.

[00:09:42] Speaker 04:
Activists in its briefing and the district court suggested that there was insufficient evidence in the record to even allow the district court to determine the basic and novel properties.

[00:09:51] Speaker 04:
We submit that the district court did not commit any error

[00:09:54] Speaker 04:
and its identification of properties.

[00:09:56] Speaker 02:
The error came... There are two other issues that we're probably going to move to, but before we do, I just want you to address again, how is the PASIDA supposed to reasonably identify the impurity A?

[00:10:09] Speaker 04:
So just focusing on the claim term of impurity A, the impurity A, the specification is silent on the identification of impurity A.

[00:10:19] Speaker 04:
It's not there.

[00:10:19] Speaker 04:
And when the extrinsic record is silent, it's appropriate to look at extrinsic evidence.

[00:10:24] Speaker 04:
And as we argued in our briefing, there is copious amount of extrinsic evidence in the form of pharmacopias from every country that clearly set out all of the known impurities of Diclofenac.

[00:10:36] Speaker 02:
And those are, it's well known to a... So the patent encompasses all of those different citations?

[00:10:42] Speaker 02:
Is it that indefinite?

[00:10:44] Speaker 04:
Well, no, Your Honor, because in the specification, they reference it as impurity A. And the person of skill in the art would have known that impurity A refers to the known impurities.

[00:10:52] Speaker 04:
And A is the first listed.

[00:10:54] Speaker 04:
They're alphabetical.

[00:10:55] Speaker 04:
It's the first listed because it is the primary degradant of the active ingredient.

[00:10:59] Speaker 04:
In the context of pharmaceutical formulations, the concern is always with degradants of the active.

[00:11:05] Speaker 02:
So was there expert testimony to this effect?

[00:11:07] Speaker 04:
Yes, there was, Your Honor.

[00:11:08] Speaker 04:
And in fact, both experts agreed that at the time of the filing of the application,

[00:11:12] Speaker 04:
that the person with skill in the art would have been aware of that information.

[00:11:15] Speaker 04:
So we submit that it was error that the district court misconstrued... Would have been aware of what information?

[00:11:21] Speaker 03:
Of the fact that... Of the... Do the experts agree?

[00:11:24] Speaker 03:
Both experts... That the citation to A here is necessarily governed by what existed in the extrinsic evidence?

[00:11:32] Speaker 04:
Well, both experts agreed that a person skilled in the art would have been aware of the available pharmacopias, which listed all of the known impurities by letter.

[00:11:41] Speaker 04:
There was an impurity called impurity that was labeled A. What activists as experts tried to suggest is that somehow, because the specification didn't identify impurity A, that that somehow rendered it ambiguous.

[00:11:56] Speaker 04:
We submit that that was not a proper analysis of the intrinsic record.

[00:11:59] Speaker 04:
And this court can review that de novo.

[00:12:01] Speaker 04:
We believe that it was proper to see that there was no definition of impurity A in the specification, and then to consult the available extrinsic evidence, which the experts agreed identified the known impurities of Dyck-Cliffin Act, including one that was called A. I think this may be what Judge Raina started with, but maybe not, is that if we disagree with you on impurity A, does that necessarily dictate that district court was also correct

[00:12:30] Speaker 03:
in the degradation construction.

[00:12:33] Speaker 04:
Well, no, Your Honor.

[00:12:34] Speaker 04:
I mean, first of all, the district court found that the improved stability basic and novel property.

[00:12:40] Speaker 04:
Well, let me just make sure I understand your question.

[00:12:42] Speaker 04:
Are you asking about the claim term degrades?

[00:12:45] Speaker 04:
Yes.

[00:12:45] Speaker 04:
OK.

[00:12:46] Speaker 04:
So with respect to the claim term degrades, we argue that in the context of how that term is used, because it specifically recites a percentage and a time frame, that a person of skill in the art would have known that that references example six

[00:12:59] Speaker 04:
specification, which relates to impurity A. So those two do stand in college together.

[00:13:02] Speaker 03:
But if we conclude that you're wrong on impurity A, i.e.

[00:13:05] Speaker 03:
that term is indefinite, then the second question on degradation goes down, too?

[00:13:11] Speaker 04:
With respect to the claim term.

[00:13:12] Speaker 04:
And that's why I wanted the clarification.

[00:13:14] Speaker 04:
Because there's also, in our view, an improper conflation of the claim term degrades, which we argued related to impurity A, and the basic and novel property of improved stability, which the district court, without any evidence at all on the record,

[00:13:29] Speaker 04:
found was indefinite because, in our view, the district court judge improperly bootstrapped from a basic and novel property of improved stability all the way down to impurity A. And there was no evidence at all to support the district court's opinion.

[00:13:45] Speaker 02:
Can you address the induced infringement issue?

[00:13:48] Speaker 02:
I'm sorry?

[00:13:48] Speaker 02:
The induced infringement issue?

[00:13:50] Speaker 04:
Yes, I'm happy to address that.

[00:13:52] Speaker 04:
We submit that the district court erred in granting activists' motion for summary judgment.

[00:13:56] Speaker 04:
We believe that activists' proposed labeling does

[00:13:58] Speaker 04:
instruct users to infringe the 450 patent family.

[00:14:03] Speaker 04:
Specifically, the activist label includes an instruction to avoid sun exposure, to be careful about UV rays because of risk of sun, of skin cancer, and then provides a very specific series of instructions to apply the topical, to wait for it to dry, and then to subsequently apply the sunscreen.

[00:14:22] Speaker 04:
And in the district courts,

[00:14:24] Speaker 03:
Opinion granting the motion for summary judgment the judge I don't understand what you just said the language says The label I don't understand how the label encourages the application of science It just says that if you apply it wait until the area is dry.

[00:14:39] Speaker 03:
How is that?

[00:14:40] Speaker 03:
A matter that would come within our jurisprudence in terms of what's required for inducement

[00:14:47] Speaker 04:
Well, in the AstraZeneca V Apotex case, this court held that where a label instructs a user, includes instructions that will inevitably cause some users of the product to infringe, that that's sufficient to find for induced infringement.

[00:15:00] Speaker 04:
And in this case, the district court judge accepted that, given the instructions and activists' labeling, that some users of the product would inevitably infringe.

[00:15:11] Speaker 04:
And that's because it warns about sun exposure,

[00:15:14] Speaker 04:
and then instruction to apply the formulation and then to wait for it to dry before putting on any other topical.

[00:15:19] Speaker 02:
That may be true.

[00:15:21] Speaker 02:
The instruction may lead to infringement, but the instruction is not a mandate or an imperative to apply.

[00:15:31] Speaker 04:
That's correct, Your Honor, that users of the product could choose a non-infringing use.

[00:15:35] Speaker 04:
But this court has recently in the Banda decision made clear

[00:15:38] Speaker 04:
the existing of a non-infringing use is not a defense to induced infringement.

[00:15:42] Speaker 04:
And here, because the instructions and labeling, as the district court accepted, would inevitably lead some users of the product to infringe under this court's precedent, specifically, I think it's very analogous to the AstraZeneca v. Apotex case, that that is sufficient to find induced infringement.

[00:15:58] Speaker 04:
In AstraZeneca, it was a claim to once-daily administration.

[00:16:01] Speaker 04:
There was nothing in the labeling that said anything about once-daily administration, but this court found

[00:16:06] Speaker 03:
but there was induced infringement because they found that there were instructions regarding... If you get a pill and it says in the instructions that do not wait for six hours until you operate a motor vehicle, are we thinking that that is instructing someone to go out and drive a car six hours later?

[00:16:24] Speaker 04:
Well, I mean, if it's an instruction as it is in this case, it's not just a caution.

[00:16:29] Speaker 04:
It's a clear instruction in section two.

[00:16:31] Speaker 03:
Well, take my hypothetical.

[00:16:32] Speaker 03:
If it says,

[00:16:34] Speaker 03:
Take one pill and do not use a motor vehicle until six, do not drive until six hours after that.

[00:16:40] Speaker 03:
Is that instructing someone to drive at the six hour moment?

[00:16:44] Speaker 04:
Well, obviously there's a fact question of whether that instruction would inevitably cause the users to infringe, but to the extent that that is, that is found, which in this case the district.

[00:16:53] Speaker 03:
So you think that kind of label is an instruction that somebody needs to go out and drive six hours after they take the pill.

[00:17:00] Speaker 04:
If it says, take this pill, wait six hours before driving, then yes, it's providing an instruction on how to safely take the product and how to safely use a motor vehicle after ingesting the product.

[00:17:12] Speaker 04:
And in this case, there was a medical need to avoid sun exposure because of the risk of skin cancer.

[00:17:19] Speaker 03:
And we have to also avoid sun exposure in a multitude of ways.

[00:17:23] Speaker 03:
The most easy one is to stay inside.

[00:17:27] Speaker 04:
That's correct.

[00:17:28] Speaker 04:
But in this case, the labeling specifically addresses the safe use of sunscreen.

[00:17:32] Speaker 04:
And that instruction is in the labeling because the district court, sorry, because the FDA recognized that application of sunscreen was something that was a likely event to occur.

[00:17:42] Speaker 04:
And they actually are the ones that required that this instruction be included in the labeling because they anticipated that users would need to apply sunscreen.

[00:17:51] Speaker 04:
I see that I'm out of time.

[00:17:52] Speaker 04:
OK.

[00:17:53] Speaker 03:
Well, we serve some rebuttal for you.

[00:17:55] Speaker 03:
Thank you.

[00:17:55] Speaker ?:
OK.

[00:17:58] Speaker 01:
Good morning, Chief Judge, and may it please the Court.

[00:18:08] Speaker 01:
I'd like to start with the cross-appeal issue.

[00:18:12] Speaker 01:
The district court found every fact in activists' favor.

[00:18:15] Speaker 01:
He found that people knew of PENCID 1.5's drawbacks.

[00:18:19] Speaker 01:
He found that people knew of the components that would improve those drawbacks.

[00:18:24] Speaker 01:
He found the exact ranges of those ingredients were found in the prior

[00:18:28] Speaker 01:
And he found that every one of those things flowed logically from the prior art.

[00:18:33] Speaker 01:
So in the face of all those factual findings about all this stuff that was in the prior art, he made two legal errors that led to a finding of non-obviousness.

[00:18:43] Speaker 01:
First, he used the general unpredictability of the art as a thumb on the scale.

[00:18:48] Speaker 01:
So after finding, in fact, that people knew exactly what ranges to use for these components, he said, but the general unpredictability of the art would trump that.

[00:18:57] Speaker 01:
And that's error.

[00:18:58] Speaker 03:
Second, he said a little more than that.

[00:19:01] Speaker 03:
I mean, he went through in detail the testimony of the experts.

[00:19:04] Speaker 03:
And certainly, if he had credited your expert, you wouldn't be here.

[00:19:07] Speaker 03:
Your friend would be here arguing about this.

[00:19:10] Speaker 03:
But given the deference that is owed, he went through the experts, and he essentially concluded.

[00:19:14] Speaker 03:
And it's a factual question whether or not this was an unexpected result.

[00:19:20] Speaker 03:
He looked at all the combinations.

[00:19:21] Speaker 03:
He rejected the notion which is like a stereo where you have six buttons, and they operate independent from each other.

[00:19:29] Speaker 03:
I mean, it's just hard, is it not, for us on review here to dislodge his conclusions, which are heavily based on what the expert said.

[00:19:41] Speaker 01:
That's not quite correct, Your Honor, because the key thing I understand is he didn't find any unexpected results.

[00:19:47] Speaker 01:
The key thing is he said there might have been unexpected results.

[00:19:52] Speaker 01:
So he didn't actually go through and say, oh, this is an interesting amount of ethanol to use.

[00:19:57] Speaker 01:
this is a strength, who knew that you could use this amount of thickener?

[00:20:00] Speaker 01:
He didn't find any of that.

[00:20:01] Speaker 01:
He said rather, and this is at A-15932 of the appendix, he said the testimony establishes, quote, it might not always work as predicted when a complex topical formulation attempts to drive an active ingredient across human skin.

[00:20:19] Speaker 01:
The point being, though, is it turns out

[00:20:22] Speaker 01:
All the ingredients did exactly what they were supposed to do.

[00:20:25] Speaker 01:
There was no actual finding of unexpected results.

[00:20:29] Speaker 01:
And that's the problem.

[00:20:30] Speaker 01:
He rather took the generalized notion that this is a complex area and said, theoretically, things could have interacted in some weird way.

[00:20:40] Speaker 01:
The thing about that is that is insufficient of this court's case law.

[00:20:43] Speaker 01:
You can't just look at a general unpredictability in the field to say that there is not obvious

[00:20:50] Speaker 01:
Because if you did that, you would change the requirement that there be some reasonable expectation of success into the requirement that there be an absolute guarantee of success.

[00:21:01] Speaker 00:
So if you do that, no pharmaceutical product would ever be patentable on this theory?

[00:21:08] Speaker 01:
No.

[00:21:08] Speaker 01:
If you adopted the district court's reasoning, every complex pharmaceutical problem would always be non-obvious.

[00:21:17] Speaker 01:
And no matter how small the change is, because

[00:21:20] Speaker 01:
Of course, there's some chance in the world that if you, for example, increase the amount of ethanol, there could be some problem with that.

[00:21:28] Speaker 01:
But the law doesn't require that there be an absolute knowledge of what's going to happen ahead of time.

[00:21:33] Speaker 01:
Rather, after KSR, there's only the requirement that people have an understanding of what is likely to happen, what is a reasonable chance of expectation of success.

[00:21:43] Speaker 01:
And the facts all back that up.

[00:21:45] Speaker 01:
The district court said, if you add ethanol,

[00:21:48] Speaker 01:
it's expected that you'll decrease drawing time.

[00:21:52] Speaker 01:
If you add the specific amount of HPMC, if you add the specific amount of thickener, that you'll actually thicken the formula.

[00:22:01] Speaker 01:
And that's what happened.

[00:22:03] Speaker 01:
They did exactly what was in the prior art, within the range of the prior art, and it turned out it worked just like everybody thought it would.

[00:22:10] Speaker 00:
No one else had done it?

[00:22:11] Speaker 00:
Your client didn't do it?

[00:22:13] Speaker 00:
Where does one second guess

[00:22:16] Speaker 00:
such a judgment on the part of the trier of fact?

[00:22:20] Speaker 01:
Because the key thing to understand is we're not asking you to second-judge the trier of fact.

[00:22:26] Speaker 01:
We want you to take all of the judge's findings of fact that are found on 15922 of the appendix.

[00:22:34] Speaker 01:
We want you to take his understanding that ethanol reduces drying time, that ethanol can serve as a penetration in his or that HPMC was entrapped.

[00:22:42] Speaker 01:
We want you to take the fact that he found that

[00:22:46] Speaker 01:
all the prior art would have informed, quote, a person of skill in the art of compatible thickening ages and suitable ranges.

[00:22:53] Speaker 01:
We want you to take all those things because those are all true.

[00:22:56] Speaker 01:
Given those facts, though, the thing the district court did was it said, well, there's a general unpredictability in the art.

[00:23:02] Speaker 01:
And he explained why, but there's a general unpredictability in the art, and that trumps all those factual findings.

[00:23:08] Speaker 00:
There's no general unpredictability or that the differences were sufficiently small that

[00:23:15] Speaker 00:
we would not allow them to accumulate to produce this formulation.

[00:23:23] Speaker 01:
Right.

[00:23:23] Speaker 01:
The point, I think, is that we don't think that having found these factual findings, you can't just put your thumb on the scale and say, well, there's general unpredictability in the art, and so these factual findings don't matter.

[00:23:36] Speaker 01:
What we say is that that's improper under this Court's case law.

[00:23:40] Speaker 00:
And I think I hear you saying you put the thumb on the scale that when it is done,

[00:23:45] Speaker 00:
for the first time, and it turns out that it is an improvement that's not unexpected.

[00:23:53] Speaker 00:
And therefore, I see this called hindsight.

[00:23:57] Speaker 00:
Therefore, even though we didn't do it, the fact that you did is not protectable.

[00:24:05] Speaker 01:
Well, what we would say is not only did we not do it, but the prior art itself showed the exact ranges to use.

[00:24:12] Speaker 01:
And so

[00:24:13] Speaker 01:
We didn't do it, but neither did Horizon.

[00:24:15] Speaker 01:
So the point being is the prior art told us exactly all the... They didn't say exact, but they were close.

[00:24:21] Speaker 00:
They were overlapping.

[00:24:22] Speaker 01:
Oh no, they were overlapping.

[00:24:24] Speaker 01:
And so therefore, once there's overlapping amounts of ingredient that's in the prior art, the ranges are in there, then you have a place where it is prima facialis.

[00:24:36] Speaker 01:
And now it could well be the case that in the end of the day, there was an unexpected result.

[00:24:41] Speaker 01:
That is a thing that can happen.

[00:24:43] Speaker 01:
The problem is that was not found here.

[00:24:45] Speaker 01:
The district court didn't say, after looking at all this, oh, here's an interesting, unexpected result.

[00:24:51] Speaker 01:
He didn't do that, and Horizon acknowledges that fact.

[00:24:53] Speaker 01:
He didn't get to that step.

[00:24:55] Speaker 01:
So the key is that one has to take these factual findings, use KSR to say, well, now that this range is in the prior art and we know what to do, we do exactly what everybody expected to do, we then have to go to whether or not

[00:25:11] Speaker 01:
There's secondary indicia of non-obviousness, for example, commercial success or unexpected results in the art.

[00:25:19] Speaker 01:
We'd have to go to that set.

[00:25:20] Speaker 01:
The district couldn't do that because it improperly said, I'm going to just rely upon the general unpredictability of the art and also that I'm going to find that the prior art did not predict the exact formulation and dosing frequency.

[00:25:35] Speaker 02:
But didn't the district court also find similar prior art references that show the unpredictability

[00:25:42] Speaker 02:
of changing the formula.

[00:25:44] Speaker 02:
He relied heavily upon... The district court did that with respect to Verizon's expert testimony.

[00:25:51] Speaker 01:
Well, Verizon's expert testimony

[00:25:54] Speaker 01:
largely agrees with us on the factual points that the District Court found.

[00:25:58] Speaker 02:
If you look at Appendix A-5934... The District Court did rely on several prior art references to show the unpredictability of changing the form.

[00:26:09] Speaker 02:
So the District Court just didn't say that there's unpredictability in the art.

[00:26:15] Speaker 02:
I mean, they actually found specific prior art references.

[00:26:19] Speaker 01:
well i mean that the discord what heavily upon dr bungee just to say why there might be interaction but there's not so i'm as it we agree with your honor that there is unpredictable in the art i don't think we're anybody's fighting upon that the point being is that you have to use that unpredictability as a factual matter correctly in the analysis so what you're not allowed to do is to say having found all these facts

[00:26:46] Speaker 01:
in activists' favor.

[00:26:49] Speaker 01:
I'm going to say it's all trumped by what could have happened, what might have happened, because the art is generally unpredictable.

[00:26:55] Speaker 01:
So the point, Your Honor, is not that we're just arguing, oh, that this is a very predictable art.

[00:27:01] Speaker 01:
No one's saying that.

[00:27:02] Speaker 01:
Everyone agrees that this is an unpredictable art.

[00:27:04] Speaker 01:
We're just simply saying, as a matter of law that this Court should review de novo, that you have to use those facts in the correct way.

[00:27:13] Speaker 01:
And the correct way is,

[00:27:14] Speaker 01:
that you just need to have a motivation.

[00:27:17] Speaker 01:
You should be able to have an obvious to try.

[00:27:19] Speaker 01:
All you need is to be pointed in the right direction.

[00:27:22] Speaker 01:
You don't need to be told exactly, specifically, this is the amount of different ingredients you should use in the prior.

[00:27:30] Speaker 01:
The overlapping ranges is sufficient.

[00:27:33] Speaker 01:
And so that's why this is reviewable de novo.

[00:27:35] Speaker 01:
And that's why we believe all the district courts

[00:27:39] Speaker 01:
factual findings are absolutely correct and in our favor.

[00:27:42] Speaker 01:
It's just the application of those facts that deserve to be reviewed.

[00:27:47] Speaker 03:
Why don't you turn to the main appeal now?

[00:27:50] Speaker 01:
So I think that the issue that got the most attention was the consisting essentially of.

[00:27:56] Speaker 01:
Excuse me?

[00:27:57] Speaker 01:
That's the one I'd like to get to.

[00:27:59] Speaker 01:
So the consisting essentially of, it's not simply a factual endeavor.

[00:28:05] Speaker 01:
You have to figure out what ingredients are allowable.

[00:28:09] Speaker 01:
and what ingredients are not allowable.

[00:28:11] Speaker 01:
And if an ingredient does not change the basic and novel properties of the convention, then you can add it in.

[00:28:19] Speaker 01:
If, however, an ingredient would change those properties, then you're not allowed to add it in.

[00:28:26] Speaker 01:
And so the whole question is what ingredients you're allowed to add and which ones aren't.

[00:28:31] Speaker 01:
You have to be able to know that ahead of time.

[00:28:33] Speaker 01:
A person of skill in the art should not be left to guess until litigation

[00:28:38] Speaker 01:
what counts and what doesn't.

[00:28:40] Speaker 03:
But if we allow consisting essentially of, that inquiry seems insurmountable to me.

[00:28:47] Speaker 03:
You have to look out there and say what possibly could material, you have to look at all the potential additions you could put in and put them into one bucket or another.

[00:28:57] Speaker 03:
How is that doable in any case?

[00:29:01] Speaker 01:
Because, Your Honor, it's not that we're asking whether any given ingredient does that.

[00:29:05] Speaker 01:
What we're saying is you have to be able to figure out

[00:29:07] Speaker 01:
whether how is one to measure one of these basic novel properties.

[00:29:12] Speaker 01:
For example, say the basic and novel property was it kept down the boiling point or something like that, some number.

[00:29:18] Speaker 01:
It made the boiling point below 100 degrees.

[00:29:21] Speaker 01:
It then is a question of fact for a fact finder later on to figure out, well, does this make the boiling point go above 100 degrees or not?

[00:29:28] Speaker 01:
That's a noble thing.

[00:29:29] Speaker 01:
We can figure it out.

[00:29:30] Speaker 01:
But in contrast, let's say one of the basic and novel features of the invention in the patent was

[00:29:36] Speaker 01:
It makes the composition aesthetically pleasing.

[00:29:41] Speaker 01:
If we were to put something that untestable into the basic novel features, how would one ever know whether or not a ingredient makes something aesthetically pleasing or not?

[00:29:52] Speaker 01:
We don't know.

[00:29:53] Speaker 01:
The point being is not that you have to go and say, here's the world of things that are allowable and not allowable.

[00:29:58] Speaker 01:
Rather, you have to come up with the way that one can actually determine

[00:30:04] Speaker 00:
that there are several hundred thousand patents out there that use the term consisting essentially of with the full blessing of the examination core as here, where this was examined and allowed using this term.

[00:30:21] Speaker 00:
And one could always argue, as you are, that there's something wrong with this.

[00:30:30] Speaker 00:
But I'm not sure that I hear exactly what this

[00:30:33] Speaker 00:
This is a usage that seems to be so common in these arts and in the art of patent claiming that you think we need to upheave, invalidate the entire cadre of pharmaceutical and other active ingredient products because of a generalized vagueness of

[00:31:02] Speaker 00:
consisting essentially of?

[00:31:05] Speaker 01:
No, Your Honor, I think that's not correct.

[00:31:07] Speaker 01:
All we are simply arguing is that 112 applies to this term like any other term.

[00:31:13] Speaker 01:
And so there will be millions and millions of patents that are perfectly fine, that are entirely definite.

[00:31:21] Speaker 01:
There's going to be ones where it's perfectly easy to measure what the novel and.

[00:31:26] Speaker 00:
So why is this different?

[00:31:28] Speaker 00:
They identify, they name the active ingredient.

[00:31:31] Speaker 01:
The reason being is because there's two problems.

[00:31:35] Speaker 01:
The first is that the listing of novel properties was very, very unclear from the patent.

[00:31:42] Speaker 01:
But besides that, we have one of those basic and novel properties being better drying time.

[00:31:47] Speaker 01:
And the patent itself is incredibly unintelligible with respect to what it means to actually measure better drying time.

[00:31:55] Speaker 00:
Perhaps there was a flaw.

[00:31:56] Speaker 00:
Maybe the examiner should have required

[00:31:59] Speaker 00:
a little more precision.

[00:32:02] Speaker 00:
But at the same time, in terms of standard, reasonably standard examiner objectivity, concentrating on the essential aspects, the active ingredients, the precise limits, but still precisely stated limits of all of the ingredients.

[00:32:21] Speaker 00:
What does one do?

[00:32:24] Speaker 00:
One disrupts the entire structure of

[00:32:29] Speaker 00:
inventing and claiming?

[00:32:33] Speaker 01:
No, Your Honor.

[00:32:33] Speaker 01:
I think all that we are asking is that 112 be applied.

[00:32:38] Speaker 01:
And so the point, I think, Your Honor, is not that it is not actually the case that, for example, better drawing time had any way of being figured out based upon what was shown in the specification.

[00:32:49] Speaker 01:
In fact, this is much like Dow, the Dow case, wherein there's many different ways that you can measure something, and you'll get different results depending upon how you measure them differently.

[00:32:58] Speaker 01:
And so given that fact, the claim is indefinite if it's talking about better drawing time.

[00:33:04] Speaker 01:
The reason being is not that there's an abstract, basic, and novel property out there that we need to be able to pin down.

[00:33:11] Speaker 01:
The point being is even given the basic and novel property of better drawing time, it's impossible based upon the specification to figure out what the inventor thought that meant or how would I measure that.

[00:33:22] Speaker 01:
There's all different measures.

[00:33:24] Speaker 01:
There's the in vivo.

[00:33:24] Speaker 01:
There's the in vitro.

[00:33:25] Speaker 00:
I think no prior artisan does an obligation during the examination process to say that there are these formulations, similar formulations, with drawing time problems.

[00:33:39] Speaker 00:
Therefore, greater precision is required in your claim.

[00:33:45] Speaker 01:
That could be certainly something that an examiner requests.

[00:33:48] Speaker 01:
But it isn't done.

[00:33:50] Speaker 01:
But it didn't here, but the problem lies in that during prosecution, it has to be remembered that this was added to get around priority.

[00:33:59] Speaker 01:
So there's a quid pro quo here.

[00:34:01] Speaker 01:
The horizon could have used consisting of.

[00:34:06] Speaker 01:
And if it had decided to use consisting of, that would have been fine.

[00:34:11] Speaker 01:
But it would have, of course, excluded a whole lot of different, possibly infringing things that would include an additional element.

[00:34:19] Speaker 01:
They decided not to do that.

[00:34:20] Speaker 01:
They decided to get something broader.

[00:34:22] Speaker 01:
They decided to do it consisting essentially of, which means that you can add things that don't affect the novel and basic properties of the invention.

[00:34:30] Speaker 01:
But in order to get that quid pro quo, you have to do something.

[00:34:34] Speaker 01:
And the thing you have to do is specify what these basic novel properties are.

[00:34:40] Speaker 01:
And then on top of it,

[00:34:41] Speaker 01:
You have to list ones that are knowable.

[00:34:43] Speaker 01:
You can't list aesthetically pleasing.

[00:34:45] Speaker 01:
You have to list.

[00:34:46] Speaker 00:
The invention as a whole.

[00:34:47] Speaker 00:
I mean, we've got this decades of history of trying to figure out what indeed is fair.

[00:34:55] Speaker 00:
What is fair to the public?

[00:34:56] Speaker 00:
What is fair to the inventor?

[00:34:57] Speaker 00:
What's fair to the competitors?

[00:34:59] Speaker 00:
So we have the invention as a whole.

[00:35:01] Speaker 00:
We have a formulation that it's undisputed with all of the limitations that are stated in the formulation or not.

[00:35:09] Speaker 00:
together in one piece of prior art.

[00:35:13] Speaker 00:
So the fact that there are, consisting essentially of, and a better drying time, favorable stability, happen to be words that are included in the claim.

[00:35:25] Speaker 00:
If they hadn't been included in the claim, we wouldn't have this problem.

[00:35:30] Speaker 01:
So why does it hurt them?

[00:35:33] Speaker 01:
Because by saying consisting essentially of,

[00:35:35] Speaker 01:
they include these basic and novel properties in the claim.

[00:35:38] Speaker 01:
The claim scope is defined by those.

[00:35:40] Speaker 01:
For example, they were able to say during prosecution, this other prior art doesn't count, because it includes something else that could affect the basic and novel properties.

[00:35:50] Speaker 01:
So they've defined the claim scope to be narrower during prosecution to exclude all those things.

[00:35:56] Speaker 01:
The point being, though, is you have to know where that dividing line is.

[00:36:00] Speaker 01:
And it's fair to the public to allow 112 to apply to these,

[00:36:04] Speaker 01:
Because we want to be able to say, what am I allowed to add?

[00:36:08] Speaker 00:
And what am I not allowed to add?

[00:36:09] Speaker 00:
I would agree if there had, in fact, been references cited in prior art which came to the edge of consisting essentially of.

[00:36:19] Speaker 00:
But I don't believe that was the case.

[00:36:21] Speaker 01:
Well, Your Honor, I believe that that was the case.

[00:36:23] Speaker 01:
During the prosecution, if we look at 32430,

[00:36:46] Speaker 01:
there was an amendment of the 838 patent that said, here are these two prior references, Hewitt and Cassay.

[00:36:55] Speaker 01:
Independent claim 61 has been amended to right site consisting essentially thereof.

[00:37:00] Speaker 02:
Where are you reading from?

[00:37:01] Speaker 01:
I'm sorry.

[00:37:02] Speaker 01:
I apologize.

[00:37:02] Speaker 01:
This is appendix 2430.

[00:37:04] Speaker 01:
It is during an amendment of 2011.

[00:37:07] Speaker 01:
OK.

[00:37:07] Speaker 01:
And it is of the 838 patent.

[00:37:11] Speaker 01:
Independent claim 61 has been amended to recite, consisting essentially of thereby limiting the formulation to the basic and novel characteristics of the formulation.

[00:37:20] Speaker 01:
As such, the claims exclude the dibasic ester of cassay, as well as the ether alcohol and a fatty alcohol ester of betlac.

[00:37:30] Speaker 01:
And they did that.

[00:37:31] Speaker 00:
The examiner accepted that.

[00:37:33] Speaker 00:
But you're now telling us that it should not have been accepted.

[00:37:38] Speaker 01:
The reason that is problematic, yes, we think that the claim is invalid.

[00:37:44] Speaker 01:
And the reason being is because of the basic and novel properties, whatever those are, if one of them includes drying time, then you can't measure it.

[00:37:53] Speaker 01:
And so you can't figure out whether or not, for example, some other prior art would have fallen within the scope of the claim or outside the scope of the claim.

[00:38:02] Speaker 01:
And so all we're asking for is that

[00:38:07] Speaker 01:
that definiteness be applied in this case like it would in any other case.

[00:38:11] Speaker 01:
We have to figure out what the boundaries are.

[00:38:12] Speaker 01:
And we can't, if we can't measure where those boundaries are.

[00:38:18] Speaker 03:
Okay, will we still have a couple minutes of rebuttal?

[00:38:20] Speaker 01:
Your Honor.

[00:38:30] Speaker 04:
Your Honor, I'd like to, Your Honor, I'd like to begin with the consisting essentially of

[00:38:34] Speaker 04:
I mean, I think the discussion kind of highlights the problem with activists' challenge here and the problem with the district court's decision is that how you evaluate the basic and novel properties really depends on what is this additional component.

[00:38:47] Speaker 04:
As Chief Judge recognized, there could be innumerable additional components, and so to require the patentee to set forth in the specification

[00:38:56] Speaker 04:
every potential objective test that would need to be used to evaluate that fact.

[00:39:00] Speaker 03:
So how is the public supposed to know what the leaps, the meats and bombs are?

[00:39:04] Speaker 04:
Well, Your Honor, I submit that the public has ample notice of the scope of the claim based on the language of the claim.

[00:39:11] Speaker 04:
The consisting essentially of term enumerates an entire list of components that must be present.

[00:39:17] Speaker 04:
And it allows that there can be some additional components which don't materially affect the basic and novel property in the intrinsic record.

[00:39:24] Speaker 04:
identifies, we think clearly in this case, what are the basic novel properties.

[00:39:28] Speaker 04:
So the public has notice of what it is.

[00:39:31] Speaker 04:
Well, that's an assumption.

[00:39:33] Speaker 03:
I mean, that's what we're here to find out, right?

[00:39:35] Speaker 03:
Whether or not the specification outlines clearly, use the word clearly.

[00:39:42] Speaker 03:
That's what we're trying to do, right?

[00:39:44] Speaker 03:
We're trying to find out whether it's definite, whether those properties are disclosed in a definite, clear way.

[00:39:51] Speaker 03:
So we're all agreeing on that?

[00:39:54] Speaker 04:
I guess, Your Honor, I would disagree slightly, because what is required of this Court's precedence is that you identify what are those properties.

[00:40:02] Speaker 04:
And what activist is suggesting is that it's not enough to identify.

[00:40:06] Speaker 03:
And so you said a few minutes ago, you identify clearly.

[00:40:09] Speaker 03:
Are you taking that back, or is the requirement that you identify clearly what those properties are?

[00:40:14] Speaker 04:
No, we submit that what properties must be considered as to whether or not there is a material effect are clearly set forth in the specification.

[00:40:23] Speaker 04:
There's no ambiguity about what are the basic and novel properties that must be considered in the factual question.

[00:40:30] Speaker 04:
Activists' argument is really based on, and the district court's judgment is somehow based on taking these properties, now importing them into the claim as if they are part of the language of the claim, and then saying, well, now they're subject to the requirements of section 112, second paragraph.

[00:40:48] Speaker 04:
But the statute requires definiteness of the language of the claims.

[00:40:52] Speaker 04:
You can't import the basic and novel properties and the language from the specification into the claims and now say, well, they're also subject to the definiteness requirement.

[00:41:01] Speaker 03:
But doesn't the disclosure of those novel and basic properties, even if it's in the specification, require clarity and definiteness?

[00:41:09] Speaker 04:
What the law requires is that the type of property to be evaluated in the factual context should be identified in the intrinsic record.

[00:41:19] Speaker 04:
But the law has never required

[00:41:21] Speaker 04:
that that term, which is assigned to the basic and novel property, in this case there are five, that each of those can now be subject to the requirements of definiteness.

[00:41:32] Speaker 04:
Because as the Supreme Court found in Dauntless, now we need to have some sort of objective standard.

[00:41:38] Speaker 04:
But to require that, not for the claim language, but with respect to basic and novel properties, which are really outside the scope of the claim that are to be used in the factual context, it doesn't make any sense at all.

[00:41:50] Speaker 04:
And this court in PPG found that the question of facts surrounding whether or not an additional component materially affects the basic and novel property is something for the trier of fact.

[00:42:02] Speaker 04:
And in that case, PPG argued.

[00:42:04] Speaker 03:
Because why?

[00:42:04] Speaker 03:
Is that an infringement question?

[00:42:06] Speaker 03:
Exactly.

[00:42:08] Speaker 04:
That's exactly right, including the examples that counsel was talking about in the file history.

[00:42:13] Speaker 04:
Those are fact questions.

[00:42:15] Speaker 04:
Is there a prior art composition that is the invention plus one, and does that materially affect

[00:42:20] Speaker 04:
the basic and novel properties.

[00:42:21] Speaker 04:
That is absolutely a fact question.

[00:42:23] Speaker 04:
And the trier of fact can hear that evidence based on however the party with the burden of proof intends to show it by whatever methodology.

[00:42:31] Speaker 04:
And they can judge whether that party has met their burden of proof.

[00:42:34] Speaker 04:
That is well within the province of the trier of fact.

[00:42:37] Speaker 04:
There's no requirement that the specification at the beginning set forth every possible test that would need to be conducted for every hypothetical formulation in this case

[00:42:47] Speaker 04:
plus one additional component.

[00:42:49] Speaker 02:
But our law requires that the specification have weeks and bounds.

[00:42:56] Speaker 04:
Your Honor, the law requires the claims have defined weeks.

[00:43:00] Speaker 04:
That's right.

[00:43:01] Speaker 04:
And the basic and novel properties are not part of the claims.

[00:43:04] Speaker 03:
OK, why don't you move on to the cross appeal for a couple minutes?

[00:43:07] Speaker 04:
Sure.

[00:43:08] Speaker 04:
So Your Honor, I have a number of points to make with respect to the 913 argument.

[00:43:12] Speaker 04:
First of all, counsel stood up and made a lot of discussion about how

[00:43:16] Speaker 04:
the district court judge erred because he had his thumb on this general unpredictability principle.

[00:43:20] Speaker 04:
I submit that that is not actually the argument that they raised in their appeal brief and their appeal.

[00:43:25] Speaker 03:
No.

[00:43:25] Speaker 03:
OK.

[00:43:25] Speaker 03:
Well, let's skip that.

[00:43:26] Speaker 03:
Sure.

[00:43:27] Speaker 03:
Why don't you point me to, I mean, they make some arguments about sort of, I don't like this term, but squishy language in the district court's opinion.

[00:43:36] Speaker 03:
So you heard their argument.

[00:43:38] Speaker 03:
They say all of the facts were found on our side in terms of the, and there's

[00:43:43] Speaker 03:
just squishy stuff in the district court's opinion.

[00:43:48] Speaker 03:
So what can you point us to in the district court's opinion that's sufficiently clear with regard to his findings on the expected results?

[00:43:56] Speaker 04:
Well, Your Honor, I think the problem is with the activists' appeal brief is that they try to take special words and pull them out of context.

[00:44:04] Speaker 04:
And it's important to look at the district court judge's opinion as a whole.

[00:44:07] Speaker 04:
It's quite lengthy.

[00:44:08] Speaker 04:
He heard seven days of trial on one single claim, the twice-daily method of use.

[00:44:12] Speaker 04:
And he accepted, as an initial premise, certain of the fact findings that activists had proposed.

[00:44:18] Speaker 04:
But on the whole, what's clear from a reading of his opinion is that he rejected activists' argument of obviousness, because they failed to assess obviousness of the invention as a whole.

[00:44:29] Speaker 04:
Instead, activists' expert, Dr. Mitch Nant Cohn, tried to assess obviousness of each individual change in the context of this results-effective variable case.

[00:44:39] Speaker 04:
And what the district court judge was really struck by was the evidence presented by Dr. Bungie that the PENSED formulation is a complex topical formulation.

[00:44:48] Speaker 04:
That's a fact finding that he made several times throughout his opinion.

[00:44:51] Speaker 04:
If you want, I can give you specific citations.

[00:44:54] Speaker 04:
But he accepted it was a complex topical formulation.

[00:44:58] Speaker 04:
And he accepted that in a complex topical formulation, such as PENSED, that the various components interact with each other.

[00:45:04] Speaker 04:
And so that when you made changes to one component,

[00:45:07] Speaker 04:
because they had to equal to 100%, it automatically, just as a matter of numbers, required a change to something else.

[00:45:13] Speaker 04:
But more importantly, that if you were adding, for example, ethanol, because you thought it was going to enhance penetration of the drug deep into the tissue to affect the pain of osteoarthritis, that that hoped-for result could be adversely affected by changes in the other components.

[00:45:31] Speaker 04:
And indeed, Dr. Bungie, in her direct testimony, cited innumerable examples

[00:45:36] Speaker 04:
in the exact prior art that Dr. Mishnyak-Cohn was attempting to rely on, that instead of showing predictability, to the contrary, showed that the general principle that she argued would hold true never did.

[00:45:49] Speaker 04:
And even fixed law, as soon as you had more than a two-component system, it no longer held true.

[00:45:55] Speaker 04:
That actually you get the opposite result.

[00:45:57] Speaker 04:
So the district court judge's opinion is really based on a finding that activists failed to assess obviousness of the combination of changes.

[00:46:05] Speaker 04:
Instead, they prefer to analogize it to the stereo receiver, imagining that each dial could be turned independently.

[00:46:11] Speaker 04:
And that was not at all the case.

[00:46:13] Speaker 04:
So his holding, ultimately, is that in the context of that fact question, which was a complex topical formulation, that you could not predict what the result would be if you adjusted one component, because every time you changed one thing, it would affect everything else.

[00:46:30] Speaker 04:
He further found that there was complexity in the skin environment,

[00:46:34] Speaker 04:
and that the interaction of the various components in the formulation, while interacting with each other, would also interact with skin in unpredictable ways.

[00:46:43] Speaker 04:
OK.

[00:46:43] Speaker 04:
Thank you.

[00:46:45] Speaker 04:
Thank you, Your Honor.

[00:46:53] Speaker 01:
Your Honor, one thing I need to address with regard to the cross appeal is that counsel suggested the district court found that these different components actually

[00:47:03] Speaker 01:
cause some unexpected result.

[00:47:05] Speaker 01:
The district court didn't get to that point.

[00:47:07] Speaker 01:
That's the key issue is the district court said, quote, on A-15.

[00:47:13] Speaker 03:
I thought what she was saying was you change one component and it could affect the other component.

[00:47:17] Speaker 03:
It's not a stagnant process.

[00:47:19] Speaker 01:
And that's correct.

[00:47:20] Speaker 01:
It could have.

[00:47:21] Speaker 01:
The point being, of course, it didn't.

[00:47:24] Speaker 01:
If you added thickener, it thickens the formula.

[00:47:28] Speaker 01:
If you added ethanol, it made it drier.

[00:47:30] Speaker 01:
It actually worked as expected.

[00:47:33] Speaker 01:
Now, yes, it could be because it is complex and this is a complex field, that there is some theoretical way that it might have adversely impacted.

[00:47:41] Speaker 01:
Maybe.

[00:47:42] Speaker 01:
The point being, though, is we don't need that in law.

[00:47:44] Speaker 01:
We don't need to know exactly what's going to happen if you add a given ingredient.

[00:47:49] Speaker 01:
All you need to have in a case are some motivation, some reason, some reasonable expectation of success, not a clear and unambiguous expectation of success.

[00:48:00] Speaker 01:
And the point there is the district court

[00:48:02] Speaker 01:
never once said anything was actually unexpected, just that you could might be because it's complex.

[00:48:10] Speaker 01:
The problem then again is that every single formula under their on-horizons definition is complex.

[00:48:17] Speaker 01:
Every single thing involves more than just water and the active ingredient.

[00:48:20] Speaker 01:
And so, of course, if that's the case, then every formulation is per se non-obvious, which can't be the law.