On December 10, 2009, the Federal Circuit is scheduled to hear oral argument in Ajinomoto Co., Inc. v. ITC (2009-1081).

By way of background, on April 25, 2006, Ajinomoto Heartland LLC filed a complaint with the ITC alleging that Global Bio-Chem Technology Group Co., Ltd.; Changchun Dacheng Bio-Chem Engineering Development Co., Ltd.; Changchun Baocheng Bio Development Co., Ltd.; Changchun Dahe Bio Technology Development Co., Ltd.; and Bio-Chem Technology (HK) Ltd. (collectively, “GBT”) were violating Section 337 by importing lysine made by methods that infringed two patents:  U.S. Patent No. 5,827,698 (the ‘698 patent) and U.S. Patent No. 6,040,160 (the ‘160 patent).  The Commission initiated an investigation on May 24, 2006 styled as Certain L-Lysine Feed Products, Their Methods of Production and Genetic Constructs for Production (337-TA-571).  Ajinomoto Heartland LLC’s parent company, Ajinomoto Co., Inc., was later added as a complainant.  On March 11-14, 2008, ALJ Bullock held an evidentiary hearing, and on July 31, 2008 issued an Initial Determination (“ID”) in the investigation, finding no violation of Section 337, due to the invalidity of the asserted claims.  On September 29, 2008, the Commission reviewed and took no position on ALJ Bullock’s findings that the relevant claim of the ‘160 patent was invalid for failure to comply with the best mode requirement of 35 U.S.C. §112 “to the extent that finding was based on fictitious data” and that the ‘160 patent was unenforceable for inequitable conduct.  It declined to review the remainder of the ID.  Thus, the Commission terminated the investigation, and adopted the ID as its Final Determination, finding no violation of Section 337.  On November 24, 2008, Complainants Ajinomoto Co., Inc., and Ajinomoto Heartland LLC (collectively, “Ajinomoto”) appealed the decision of the ITC to the Federal Circuit.

According to Ajinomoto’s Opening and Reply briefs to the Federal Circuit, the Commission erred in its application of the best mode requirement with respect to both the ‘698 patent and the ‘160 patent.  The issues, as presented by Ajinomoto, are (1) whether the ITC erred in finding best mode violations for failure to disclose features of the ‘698 patent which were not included in the claims; (2) whether the ITC erred in finding the ‘698 patent invalid for failure to disclose sucrose as nourishment for Escherichia coli (“E. coli”), which was both a production detail and known in the art; (3) whether the ITC erred in finding the ‘698 patent invalid for failure to disclose the details of an unclaimed experiment that yielded a host bacterial strain that did not contain the patented mutation, and was disclosed in the patent and put on public deposit; (4) whether the ITC erred in finding the ‘698 patent invalid for disclosing purportedly “fictitious” experimental data where there was no finding as to what the best mode was, whether it was disclosed or not, or how the data related to that unnamed mode; and (5) whether the ITC erred in invalidating the ‘160 patent entirely, rather than merely holding that the Japanese filing date was not available for priority purposes.

Ajinomoto argues that the Patent Act requires that best mode be set forth with regard to the invention itself, and not with regard to unclaimed subject matter.  According to Ajinomoto, feeding E. coli sucrose to increase lysine production is outside the scope of the ‘698 patent’s claims, and therefore is not subject to the disclosure requirements of §112.  Furthermore, Ajinomoto asserts, sucrose as a food source for E. coli was well known in the art at the time of filing and was merely a production detail; consequently, it need not be included in the disclosure to satisfy the best mode requirement.  Ajinomoto also argues that the ‘698 patent does not claim protection for the results of an experiment yielding a host strain, and thus need not be disclosed as a best mode.  Furthermore, Ajinomoto maintains that, even if it were claimed, this host-strain was placed on public deposit and the deposit was disclosed in the patent, necessarily satisfying the best mode requirement.  Discussing the “fictitious” data, Ajinomoto states that this data is not claimed in the patent, and therefore also requires no best mode disclosure.  Ajinomoto additionally questions the applicability of a best mode analysis to this data as, in their view, the data does not relate to a best mode of any matter.

With regard to the ‘160 patent, the ITC determined that the Japanese application, from which the ‘160 claims priority, failed to disclose a particular laboratory host strain, which was a best mode of the priority invention.  Ajinomoto asserts that this host strain was not claimed in the ‘160 patent and that the inventors discarded the host strain within months of filing the priority application.  Ajinomoto also maintains that even if the priority application did not disclose the best mode, this does not render the ‘160 patent invalid; it merely disables the ‘160 patent from claiming priority based on that application.

According to the Commission’s Brief in support of the ITC’s final determination, the issues are (1) whether the Commission properly found that the relevant claim of the ‘698 patent was invalid for violating the best mode requirement; (2) whether the Commission properly found that the ‘698 patent was unenforceable for inequitable conduct before the USPTO; and (3) whether the Commission properly found that the relevant claim of the ‘160 patent was invalid for violating the best mode requirement.

In contrast to Ajinomoto, the Commission argues that the ‘698 patent is invalid for violating the best mode requirement because the best mode requirement applies both to the invention and to all subject matter that materially affects the properties of the invention.  Accordingly, the Commission asserts that using sucrose as a food source materially affects the properties of the claimed invention and should have been disclosed as a best  mode.  The Commission also notes that, as of the filing date, the inventors had a subjective preference for sucrose and the use of sucrose was not a mere production detail.  The Commission states that Ajinomoto also violated the best mode requirement by failing to disclose the insertion of variant lysC genes and sucrose utilization genes into the preferred bacterial strain, and a person of ordinary skill in the art would be unable to practice the best mode without such a disclosure.  According to the Commission, depositing this preferred strain did not cure the failure of the specification, because the strain deposited was not the strain identified as being deposited in the specification.  Additionally, the Commission asserts that the “fictitious data” included in the ‘698 patent represents a derivative strain which was never used experimentally.  In the Commission’s view, this data was disclosed in an effort to conceal the best mode of practicing the patent’s claims.

With regard to inequitable conduct, the Commission argues, in light of the previous violations, that Ajinomoto engaged in a pattern of non-disclosure and made a series of misrepresentations in procuring the ‘698 patent.

In connection with the ‘160 patent, the Commission asserts that Ajinomoto did not disclose the best host strain for practicing the relevant claim of the ‘160 priority application.  The Commission argues that an application to which a patent claims priority must contain the complete disclosure.  Furthermore, the Commission asserts that Ajinomoto may not alternatively claim priority from the later-filed PCT application because an intention to change the priority date was not set forth in the pre-hearing brief, as ALJ Bullock required.

In its Intervenor Brief, GBT argues, as does the Commission, that the best mode disclosure applies to all claim elements, not simply to those elements that are novel. Additionally, GBT asserts that, based on the claim language of the ‘698 patent, Ajinomoto was required to disclose its best carbon source, sucrose.  GBT also maintains that the use of sucrose as a carbon source is not a mere production detail and the use of sucrose and sucrose utilization genes was not known to the person of ordinary skill in the art.  GBT further concludes that the language of the ‘698 patent requires a disclosure of Ajinomoto’s best “microorganism,” the bacterial strain including the variant lysC genes and sucrose utilizations genes, for carrying out the claimed invention.  Moreover, GBT argues that Ajinomoto’s deposited strain was not used for carrying out the relevant claim of the ‘698 patent, and that the strain was misdescribed in the specification; thus, public deposit did not satisfy the requirements of §112.  GBT additionally maintains that the “fictitious” data included in the ‘698 patent represented a failure to disclose the best mode of the invention.

GBT argues that the Commission’s finding of inequitable conduct should be affirmed, regardless of the Court’s decision concerning best mode.

With regard to the ‘160 patent, GBT asserts that Ajinomoto failed to disclose their best “bacterium” for carrying out the invention.  GBT also argues, in concert with the Commission, that Ajinomoto waived its ability to alter the priority date for the ‘160 patent by asserting this position for the first time post-trial.