The Risk of Using “Consisting Essentially of” in Patent Claims
The legal meaning of the transition language “consisting essentially of” is well-established in Federal Circuit case law and is generally construed to mean that the composition or formulation (a) necessarily includes the listed ingredients and (b) is open to unlisted ingredients that do not materially affect the basic and novel properties of the composition. Similarly, when “consisting essentially of” is used in a process claim, the claim requires that the listed steps are performed, but also may include unlisted steps that do not affect the basic and material properties of the process. Accordingly, a “consisting essentially of” claim is typically understood to signal a middle ground between a closed claim that is written in a “consisting of” format and, thus, excluding any items not expressly recited in the claim, and an open claim that is written in a “comprising” format such that any unrecited items are not excluded. However, the middle ground just became a little less secure for patent holders with the Federal Circuit’s opinion in HZNP Medicines LLC v. Actavis Laboratories UT, Inc. In a nutshell, the phrase “consisting essentially of” is indefinite if any identified basic and novel property is indefinite.
To provide some quick background, HZNP and Horizon own patents covering PENNSAID® 2% – the first FDA-approved twice daily topical diclofenac sodium formulation for the treatment of the pain of osteoarthritis of the knees (Horizon patents). The Horizon patents include the method of use and formulation claims. Actavis asserted that the generic copy of PENNSAID® 2% described in Actavis’ Abbreviated New Drug Application No. 207238 would not infringe any valid and enforceable Horizon patent. Horizon sued Actavis for patent infringement of the Horizon patents in the District of New Jersey.
During the claim construction (Markman) phase, the district court held that the formulation claims, which feature a topical formulation having a viscosity of 500 to 5,000 centipoise “consisting essentially of” certain ranges of diclofenac sodium, dimethyl sulfoxide, ethanol, propylene glycol, hydroxypropyl cellulose, and water were indefinite. More specifically, while the district court found that the specification sufficiently identified five basic and novel properties of the claimed invention — i.e., (1) better drying time; (2) higher viscosity; (3) increased transdermal flux; (4) greater pharmacokinetic absorption; and (5) favorable stability — it concluded that a person of ordinary skill in the art would not be able to have reasonable certainty about the scope of these properties.
On appeal, Horizon tried to convince the Federal Circuit that the Nautilus definiteness standard does not apply to the basic and novel properties of the invention. As a refresher, under Nautilus, Inc. v. Biosig Instruments, Inc., the Supreme Court determined that a claim is invalid for indefiniteness if its language, read in light of the specification and prosecution history, fails to inform with reasonable certainty those skilled in the art about the scope of the invention. In shooting down this argument, the majority clarified that by using “consisting essentially of” in a claim, an inventor incorporates into the scope of the claims an evaluation of the basic and novel properties. Thus, the Nautilus definiteness standard applies to the basic and novel properties.
Horizon also tried to persuade the Federal Circuit that the basic and novel properties are to be considered only as factual determinations of validity and infringement — not at the claim construction stage. Again, the majority was not swayed and explained that the determination of the basic and novel properties of an invention at the claim construction stage is critical to afford clear notice of what is claimed. If any property does not inform a person of ordinary skill in the art with reasonable certainty about the scope of the invention, then the phrase “consisting essentially of” is indefinite in light of the indefinite scope of that property.
On the other side of the podium, Actavis argued that the five basic and novel properties were not identified in the specification as important enough to even be considered basic and novel properties. The majority’s opinion explains that each of the five properties are included in the specification as separate subheadings with discussions of both the importance of each of the properties and the advantages of the invention over prior art with respect to these properties such that the intrinsic record sufficiently identifies the properties as the basic and novel properties of the invention. Despite the basic and novel properties being readily identifiable from the specification, the majority agreed with the district court that one of the five identified basic and novel properties, i.e., better drying time, was indefinite. More specifically, since the two different tests in the specification produced inconsistent results, the majority concluded that a person of ordinary skill in the art would not understand which test to use to evaluate this property. And, as set forth above, if the basic and novel properties are indefinite, so is the phrase “consisting essentially of.”
In sum, if a person of ordinary skill in the art cannot ascertain the bounds of the basic and novel properties of the invention recited in a “consisting essentially of” claim, the claim is indefinite because there is no basis upon which to analyze whether an unlisted item has a material effect on the basic and novel properties.
So what are the key takeaways from this part of the Horizon decision? First, for patent practitioners, be conscientious when employing “consisting essentially of” language in claims. While the majority’s opinion made it clear that “consisting essentially of” claims are not per se indefinite, ambiguities in the specification as to the basic and novel properties of the invention or what constitutes a material alteration of these properties certainly leave such claims vulnerable to an indefiniteness attack. Since “consisting essentially of” language is typically introduced during prosecution in an effort to distinguish over a cited reference, ensure that any such amendment to the transition language is thoroughly vetted as if you are in the Markman phase of a patent infringement trial. Even though “consisting of” language is narrower in scope than “consisting essentially of” language, if the specification lacks requisite clarity with regard to the basic and novel properties of the invention, you would be better off obtaining a closed claim than a middle ground claim susceptible to attack under 35 U.S.C. § 112.
Second, for accused infringers wanting to challenge the validity of a “consisting essentially of” claim for failure to clearly identify the basic and novel properties or what constitutes a material alteration of these properties, be prepared to do so early in the dispute and no later than the Markman phase. If the only asserted claims are “consisting essentially of” claims, you may be able to end the dispute altogether well before summary judgment. If the asserted claims are not limited to the “consisting essentially of” claims, you at least may be able to significantly narrow the issues for subsequent phases of the litigation, thus reducing litigation costs, as well as possibly gaining considerable leverage for settlement purposes.