[00:00:03] Speaker 03:
The next case for argument is 19-1125, Prostacken versus Aftonis.

[00:01:12] Speaker 03:
Good morning.

[00:01:15] Speaker 04:
Good morning, Your Honors.

[00:01:16] Speaker 04:
May it please the Court.

[00:01:17] Speaker 04:
Gary Hood on behalf of the Appellant Activist Laboratories, UT, Incorporated.

[00:01:21] Speaker 04:
The issue on this appeal is the proper treatment of the transitional phrase consisting essentially of.

[00:01:27] Speaker 04:
That phrase in this particular patent suit, the 282 patent, was added late in the prosecution, a tortured prosecution that took five plus years.

[00:01:36] Speaker 04:
And that particular amendment, which came based on the examiner,

[00:01:40] Speaker 04:
asking that that be done to issue the patent, set in motion the test by which the plaintiff at the district court level, Prostracan, would have to prove infringement.

[00:01:51] Speaker 04:
And that is the reason why we're here today, because the district court, in attempting to apply the test for what is a material effect on the basic and novel properties of the invention, which is required with respect to that transitional phrase, applied a test that was incomprehensible and found infringement

[00:02:09] Speaker 04:
despite the fact that the evidence that was presented did not address directly the material effect of an unclaimed ingredient, vinyl acetate, in the activist's accused product.

[00:02:22] Speaker 04:
The prosecution history is in the file.

[00:02:24] Speaker 04:
This is at the appendix, page 2652, where the acrylic adhesive is the focus of that particular transitional phrase.

[00:02:33] Speaker 04:
The claims in August of 2005 did not include that phrase.

[00:02:36] Speaker 04:
They were to an adhesive patch.

[00:02:38] Speaker 04:
Quote, we're in the adhesive as an acrylic adhesive containing non-acidic hydroxyl moieties.

[00:02:43] Speaker 04:
And then over the course of a good five years, we get finally to a request for continuing examination where specific amounts of monomers are added into the claims.

[00:02:54] Speaker 04:
This is after a number of rejections of the claims on both 102 and 103 grounds and specific pieces of prior art that the examiner found to anticipate

[00:03:03] Speaker 04:
or render obvious the claims.

[00:03:04] Speaker 04:
That then results in June of 2009 in this examiner's amendment, where this phrase, consisting essentially of, is brought into the claims.

[00:03:14] Speaker 04:
Prostracan agrees to allow that to come into the claims in order to get the patent issued.

[00:03:20] Speaker 04:
And that's when the patent finally issued in 2009.

[00:03:24] Speaker 04:
The issued claim then is to an acrylic adhesive, specifically with respect to the element that we're here to talk about, consisting essentially of,

[00:03:32] Speaker 04:
And I won't quote the claim, but a primary monomer and a functional or modifying monomer with respect to non-acidic hydroxyl moiety.

[00:03:40] Speaker 04:
So the proper legal test, we don't have a lot of cases on this, of course.

[00:03:44] Speaker 04:
It doesn't come up a lot.

[00:03:45] Speaker 04:
But the proper legal test is then for the plaintiff to prove infringement.

[00:03:49] Speaker 04:
They have to do what they normally do, and that is to prove all of the elements of the claim are present.

[00:03:54] Speaker 04:
But they have an additional burden.

[00:03:55] Speaker 04:
They also have to prove that unclaimed ingredients,

[00:04:00] Speaker 04:
that are in the invention, here the acrylic adhesive, do not have a material effect in the product, in the accused product.

[00:04:07] Speaker 04:
In the accused product, that's correct, Your Honor, on the basic and novel properties of the invention.

[00:04:12] Speaker 04:
In this case, at the district court level, the parties disputed the basic and novel properties.

[00:04:16] Speaker 02:
Should I ask you a question?

[00:04:17] Speaker 02:
Yes, Your Honor.

[00:04:17] Speaker 02:
In the brief, you also really emphasized or spent devote time to the court's interpretation.

[00:04:23] Speaker 02:
You're not focusing on that right now.

[00:04:25] Speaker 02:
Right now, you're focusing

[00:04:26] Speaker 02:
not on the interpretation of consisting essentially of so much as focusing on the evidentiary question of whether there's infringement.

[00:04:33] Speaker 04:
That's correct, Your Honor.

[00:04:34] Speaker 04:
That is correct.

[00:04:35] Speaker 04:
We also did dispute the basic and novel properties.

[00:04:39] Speaker 04:
Here on this appeal, we're saying, based on the court's application of the material effect test, the evidence did not show.

[00:04:49] Speaker 04:
Prostracan did not carry its burden to show that the vinyl acetate, which is an unclaimed ingredient in the activist accused product, does not have a material effect on those basic and novel properties.

[00:04:59] Speaker 04:
That's correct.

[00:05:00] Speaker 04:
There were three basic and novel properties, as our briefs show.

[00:05:03] Speaker 04:
We focused on one, and that is what the court called the increased transdermal delivery of granicitron.

[00:05:09] Speaker 04:
That's the active drug that's in the patch.

[00:05:12] Speaker 04:
We talk about that as permeation, and that's how we simplified that.

[00:05:17] Speaker 04:
It was undisputed in the district court that the activist-accused product

[00:05:21] Speaker 04:
the acrylic adhesive, which is a commercially available acrylic adhesive, has 26.5% vinyl acetate.

[00:05:27] Speaker 04:
So over a quarter of this particular acrylic adhesive is this unclaimed component vinyl acetate.

[00:05:33] Speaker 04:
So the issue then for the district court and the burden on Prostracan was to prove that 26.5% vinyl acetate in the activist and the product did not materially affect permeation.

[00:05:46] Speaker 04:
And that's where we submit the district court went astray.

[00:05:49] Speaker 04:
What it did was it adopted for what is and is not a material effect.

[00:05:55] Speaker 04:
What we have argued is a nonsensical standard.

[00:05:57] Speaker 04:
This came out of Prostrakhan's expert on direct questioning from the district court.

[00:06:02] Speaker 04:
And what he said was, quote, a material effect is a large enough effect that would project that a POSA, personal skill in the art, could make a reasonable size granicitron transdermal patch

[00:06:14] Speaker 04:
based on that transdermal permeation.

[00:06:17] Speaker 04:
That's in the appendix at pages 62.15 to 62.16, and it's finding effect 111.

[00:06:23] Speaker 04:
I still don't know what that means.

[00:06:26] Speaker 04:
It seems to suggest that that would not be a material effect.

[00:06:29] Speaker 04:
If a person of skill in the art could make a patch that works with granicetron, it doesn't seem to be a material effect.

[00:06:36] Speaker 04:
The court didn't cite any case law for that.

[00:06:38] Speaker 04:
It relied solely on Dr. Nscor, who was the expert that made that particular statement.

[00:06:43] Speaker 04:
But then, through that lens, determined that based on the evidence presented by Prostercan, there was infringement.

[00:06:52] Speaker 04:
And that evidence was insufficient, simply insufficient.

[00:06:56] Speaker 04:
Basically two pieces of evidence that were presented.

[00:06:58] Speaker 04:
The first comes out of the 282 patent itself, and this is table two of the patent.

[00:07:03] Speaker 04:
This is in the appendix of page 197, and this is a table that shows the relative permeation amounts for four different acrylic adhesives.

[00:07:12] Speaker 04:
These are all what are called Durotac adhesives, DT.

[00:07:16] Speaker 04:
There's DT4098, 2052.

[00:07:20] Speaker 04:
2353 and then 2287.

[00:07:22] Speaker 04:
And 2287 is the adhesive that is in the accused product.

[00:07:27] Speaker 04:
And what this table shows is, with respect to those four adhesives, different permeation levels that were tested at different time intervals from three hours to 48 hours.

[00:07:37] Speaker 04:
The table, though, as the evidence also showed, based on what was also entered into evidence, the Durotech product selection guide.

[00:07:45] Speaker 04:
This is at the appendix, page 2716, tells you what's in.

[00:07:50] Speaker 04:
each of these particular adhesives.

[00:07:52] Speaker 04:
This is a guide that was used by people who were formulating adhesives with respect to the different adhesives.

[00:07:59] Speaker 04:
For three of those four adhesives, they have vinyl acetate.

[00:08:03] Speaker 04:
One of those adhesives does not have vinyl acetate.

[00:08:06] Speaker 04:
The one that does not is the Durotech 2353.

[00:08:11] Speaker 04:
And it just so happens, if you look at table two in the appendix at page 197, this is directly out of the patent,

[00:08:17] Speaker 04:
that one adhesive without vinyl acetate across the board has the lowest amount of permeation.

[00:08:25] Speaker 04:
So if anything, the conclusion from this, at least based on the information presented here, is that vinyl acetate seems to be increasing permeation, if anything.

[00:08:33] Speaker 04:
Now, there's different levels of permeation, depending on which of the adhesives you look at, and there's different functional groups.

[00:08:40] Speaker 04:
And the court focused on that, whether there was any functional group, which there isn't in 4098, or whether there's a carboxylic acid functional group, which there are in 2052 and 2353, or whether there's an on acidic hydroxyl, which is like 2287.

[00:08:55] Speaker 02:
Just to clarify, in these charts that you're referring to right now,

[00:08:59] Speaker 02:
It's the DT2287 that actually is the one that's in claim six, right?

[00:09:04] Speaker 02:
Or not claim six, but in the claims, right?

[00:09:07] Speaker 04:
Not technically, Your Honor.

[00:09:08] Speaker 04:
It's 2287 that is in the patent.

[00:09:11] Speaker 04:
2287 isn't directly called out in the patent.

[00:09:15] Speaker 02:
It's not, but we're talking about the OH group as opposed to the carboxyl group.

[00:09:19] Speaker 02:
That is correct.

[00:09:20] Speaker 02:
Because the one you're pointing to, the 2353, has a carboxyl.

[00:09:24] Speaker 04:
That is correct, Your Honor.

[00:09:25] Speaker 04:
That is correct.

[00:09:26] Speaker 04:
And that was the transitional phrase applies to that what was termed in the patent, the non-acidic hydroxyl moiety.

[00:09:32] Speaker 04:
That's the OH group.

[00:09:34] Speaker 04:
That's in there.

[00:09:36] Speaker 04:
The court also looked to Prostracan presented another table.

[00:09:39] Speaker 04:
And this came directly out of the Activist ANTA.

[00:09:41] Speaker 04:
This was an Activist ANTA formulation transfer report.

[00:09:44] Speaker 04:
This is in the appendix of pages 27, 23,

[00:09:47] Speaker 04:
to 2724, and similar to Table 2 of the patent, this shows relative permeations that were tested by activists in connection with its ANDA for various commercially available adhesives.

[00:10:03] Speaker 04:
And this includes, again, 2287, but it includes some others.

[00:10:08] Speaker 04:
Durotech 2196.

[00:10:10] Speaker 04:
Durotech 2677 and Durotech 2054.

[00:10:15] Speaker 04:
And it shows at various time points the permeations.

[00:10:18] Speaker 04:
The point of this table, at least in context of where this came out, was to show that for purposes of FDA approval, the activist product was going to work similarly to the Sankuso branded product.

[00:10:29] Speaker 04:
But that being said, the evidence here again shows for all four of the, not the Sankuso at the top of the table, but the other four adhesives that were tested

[00:10:40] Speaker 04:
and that are reported here, all of these include vinyl acetate.

[00:10:45] Speaker 04:
Three of these include carboxylic acid groups, and only the one, the 2287, includes the non-acidic hydroxyl.

[00:10:52] Speaker 04:
The district court focused on only two of these, though, and that was the 2287 as compared to the 2196.

[00:10:57] Speaker 04:
If you look at the 2196, it just happens to be the one that has the lowest amount of permeation across the board.

[00:11:05] Speaker 04:
Again, all of these have vinyl acetate in them.

[00:11:08] Speaker 04:
But from that alone, the court concluded that the non-acidic hydroxyl is what it called the factor increasing permeation.

[00:11:16] Speaker 04:
Did not address specifically vinyl acetate.

[00:11:18] Speaker 04:
What we do know is, both in this table from the activists and in the patent, we know the quantity of vinyl acetate only in the DT2287.

[00:11:27] Speaker 04:
There was never any evidence presented in the district court of the quantity of vinyl acetate in any of these other Durotech products.

[00:11:35] Speaker 04:
So we know Durotech.

[00:11:37] Speaker 04:
Specifically, with respect to certain formulations of it, either do or don't have vinyl acetate, we only know the amount for Durotact-2287.

[00:11:45] Speaker 04:
The district court disregarded that, looked simply to these tables and said, well, I see there's a difference in permeation between carboxylic acid groups and non-acidic acid groups.

[00:11:55] Speaker 04:
And I'm going to say that, based on that, despite the fact that there's differences in vinyl acetate and unknown, we had no proof or evidence of the relative amounts of vinyl acetate in these formulations, that there's infringement.

[00:12:09] Speaker 02:
He relied on expert testimony in making that conclusion, right?

[00:12:13] Speaker 04:
He did, Your Honor, yes.

[00:12:14] Speaker 04:
And Prostracan presented Dr. Nscor.

[00:12:17] Speaker 04:
It was their expert at trial.

[00:12:18] Speaker 04:
And Dr. Nscor was the one that presented these particular pieces of evidence with respect to his conclusion, ultimately, that vinyl acetate does not have a material effect.

[00:12:27] Speaker 04:
Dr. Inscore testified, and he was asked a number of times, did you test the product?

[00:12:32] Speaker 04:
Did you test the activist and the product?

[00:12:34] Speaker 04:
Because that's the inquiry that we have to look at for infringement.

[00:12:37] Speaker 04:
He did not.

[00:12:38] Speaker 04:
And his testimony was, well, if I tried to do what was suggested, and that is,

[00:12:46] Speaker 04:
the acrylic adhesive in the activist product with vinyl acetate and without vinyl acetate to figure out if the vinyl acetate in the product is having a material effect on permeation.

[00:12:57] Speaker 04:
His testimony was, well, it wouldn't be Durotac 2287.

[00:12:59] Speaker 04:
And that's not the point.

[00:13:01] Speaker 04:
The point is he said the vinyl acetate is nothing but a bulking agent, or I think he said it affects the bulk physical properties or something like that.

[00:13:10] Speaker 04:
Take it out or do something to show, does the vinyl acetate, particularly when you have it with this non acidic hydroxyl moiety as they call it, have an effect on the permeation?

[00:13:21] Speaker 04:
Is it increasing the permeation?

[00:13:23] Speaker 04:
Is it decreasing the permeation?

[00:13:25] Speaker 04:
If you look at the tables, what we can't tell is,

[00:13:28] Speaker 04:
You look at those carboxylic acid group formulations, and it looks like for all those, it's lower.

[00:13:32] Speaker 04:
Is it the presence of a carboxylic acid group, with or without vinyl acetate, that is causing permeation to be suppressed?

[00:13:40] Speaker 04:
We simply don't know.

[00:13:41] Speaker 04:
And Dr. Anscore didn't test for this.

[00:13:43] Speaker 04:
There was no evidence presented other than his conclusory testimony that, well, based on these tables, and the court looked at some prior art and some other things to try to fill some gaps here in the puzzle and put together the infringement puzzle, my conclusion is

[00:13:57] Speaker 04:
Dr. Renshaw says, that vinyl acetate has no material effect.

[00:14:00] Speaker 04:
And the court decided, based on this evidence, well, even though I know that there's a difference between certain of these formulations with or without vinyl acetate, and I don't know how much, I'm going to say it's those carboxylic acid groups as compared to the non-acetic hydroxyls.

[00:14:15] Speaker 04:
And therefore, vinyl acetate does not have a material effect.

[00:14:20] Speaker 04:
The court effectively shifted the burden as well, Your Honors.

[00:14:23] Speaker 04:
And the court criticized activists in a number of ways for not presenting affirmative evidence that there was not or that there was a material effect from vinyl acetate, specifically criticizing the activist expert, Dr. Tan.

[00:14:41] Speaker 04:
And what the court said here, and this is at finding effect 117 in the appendix of page 45,

[00:14:47] Speaker 04:
Contrary to Dr. Inscore, Dr. Tan cited no documentary evidence.

[00:14:51] Speaker 04:
He testified about the same tables that Dr. Inscore did.

[00:14:54] Speaker 04:
He performed no laboratory experiments.

[00:14:57] Speaker 04:
Dr. Inscore performed no laboratory experiments.

[00:14:59] Speaker 04:
I'm not sure where that came from.

[00:15:01] Speaker 04:
End quote, provided no data that vinyl acetate is anything other than a bulking, modifying monomer.

[00:15:06] Speaker 04:
Perhaps he didn't, but he testified as a formulator at the company that makes these Durotech adhesives about what it is and that it does a lot more than simply add bulk.

[00:15:18] Speaker 04:
I see I'm into my rebuttal time.

[00:15:19] Speaker 04:
Thank you.

[00:15:19] Speaker 03:
You pretty much exhausted it, but will we spare some time?

[00:15:41] Speaker 00:
Good morning, Chief Judge, Your Honors.

[00:15:42] Speaker 00:
Barry Golub, cousin of Conner for ProsterCon.

[00:15:45] Speaker 00:
If I could pick up on something that Mr. Hood just said.

[00:15:49] Speaker 00:
He said that the two experts looked at the same evidence.

[00:15:53] Speaker 00:
And that's what happened here.

[00:15:55] Speaker 00:
The two experts looked at the patent.

[00:15:58] Speaker 00:
They looked at the testing in the patent.

[00:16:01] Speaker 00:
They looked at the testing in activist's ANDA.

[00:16:06] Speaker 00:
And the court said, we met our burden.

[00:16:10] Speaker 00:
And we showed that this testing and the activist testing and what the prior art says

[00:16:15] Speaker 00:
and what the patent says about the function of vinyl acetate and what vinyl acetate is used for and how it reacts.

[00:16:23] Speaker 00:
And the court said, our witness is credible.

[00:16:27] Speaker 00:
Their witness is not credible.

[00:16:29] Speaker 00:
It's the same evidence.

[00:16:30] Speaker 00:
There's no requirement for testing.

[00:16:33] Speaker 00:
MarTech tells us there's no requirement here for testing.

[00:16:36] Speaker 00:
The question is, did we meet our burden to show by a preponderance of evidence that vinyl acetate doesn't have a material effect

[00:16:45] Speaker 00:
on the basic and novel properties.

[00:16:47] Speaker 01:
I don't have it in front of me but there's that sentence from the expert that was read before which is extremely difficult for me to understand what it even means and yet the district court seems to have relied on that in some way

[00:17:13] Speaker 01:
making its factual conclusion.

[00:17:15] Speaker 01:
Can you explain what that sentence is supposed to mean?

[00:17:19] Speaker 00:
Sure.

[00:17:19] Speaker 00:
I believe you're talking about the definition of material effect.

[00:17:23] Speaker 01:
Is that what you're... Yeah, first of all, what page should I be looking at?

[00:17:25] Speaker 00:
So the court in finding a fact 111 at APPX 43 said basically that a material effect is that there's enough granicetron flux or permeation so that you could make a reasonably sized patch.

[00:17:42] Speaker 00:
that's what it was defined at and that was based on his testimony at 6240 where he says where he compared the adhesives of 2052 and 2353 from the patent

[00:17:55] Speaker 00:
And those are both the ones with carboxyl groups.

[00:17:58] Speaker 00:
One had vinyl acetate and one didn't.

[00:18:00] Speaker 00:
And he said, neither one of those are acceptable, because you could not, based on the patent and the teachings of the patent, you could not make a patch of reasonable size based on that flux.

[00:18:11] Speaker 00:
The only one you could make a patch of a reasonable size was of 2287.

[00:18:16] Speaker 00:
And that makes sense, because the patent tells you at APPX193,

[00:18:21] Speaker 00:
that the object of the invention is to reduce the size of the patch necessary to achieve anti-emetic blood plasma levels in the drug.

[00:18:29] Speaker 00:
That's what was the invention.

[00:18:32] Speaker 00:
The prior art, as it stated in the patent, said that there was a patch that was 100 centimeters squared.

[00:18:39] Speaker 00:
Indeed, in claim 23 of the patent, it tells you exactly what the size needs to be.

[00:18:44] Speaker 00:
We claim between 10 and 100 centimeters squared.

[00:18:48] Speaker 00:
So the definition was,

[00:18:51] Speaker 00:
put there based on the information of the patent.

[00:18:53] Speaker 00:
And the court said it went unrebutted and accepted that definition.

[00:18:58] Speaker 00:
And so that's a finding of fact that the court has obviously given deference to.

[00:19:04] Speaker 00:
So that's where the definition came from.

[00:19:08] Speaker 00:
There were many other sites in the patent at common.

[00:19:12] Speaker 01:
And what was the underlying evidence, by which I mean underlying what the experts asserted?

[00:19:18] Speaker 01:
for the proposition that the, was it the vinyl acetate?

[00:19:23] Speaker 01:
Is that what we're talking about?

[00:19:24] Speaker 00:
The vinyl acetate.

[00:19:25] Speaker 01:
The vinyl acetate didn't make a material difference in, let's say, the size of a patch that you would need to get the required, the therapeutically required amount of the medication in.

[00:19:41] Speaker 00:
Right.

[00:19:41] Speaker 00:
So there were several things that were relied upon by the expert.

[00:19:46] Speaker 00:
First, he relied upon the description

[00:19:48] Speaker 00:
at APPX 194, column 4 of the patent, which describes that vinyl acetate is a modifying monomer and it's used for bulk and tack.

[00:20:02] Speaker 00:
And that's very well known.

[00:20:04] Speaker 00:
It's part of the long history of what vinyl acetate is.

[00:20:08] Speaker 01:
And it also at APPX 194, column 4... From which the implication is it would not have a permeation reducing effect?

[00:20:17] Speaker 00:
Right, it's an inert monomer, so it doesn't affect.

[00:20:22] Speaker 00:
The whole patent is about a functional monomer is what's doing all of the ability for this flux to come out quick enough to make a reasonably sized patch.

[00:20:33] Speaker 00:
The vinyl acetate is inert.

[00:20:34] Speaker 00:
It's non-reactive.

[00:20:36] Speaker 00:
The teaching in the patent is that.

[00:20:38] Speaker 00:
And it teaches you that it should be between 10% and 40%, which is exactly where it is.

[00:20:45] Speaker 00:
So when we look at this, Dr. Enscor looked at the patent.

[00:20:50] Speaker 02:
Were you also going to refer to column four, lines 38 to 44 or so, where it talks about how permeation enhancers are generally not required in the present invention?

[00:21:03] Speaker 00:
Yes, so in this case, because the flux was so good with the hydroxyl functional group, there was no need for a permeation enhancer.

[00:21:12] Speaker 00:
As the court may be aware, when you are having a transdermal delivery, sometimes you need to use a permeation enhancer because you can't get enough flux out.

[00:21:22] Speaker 00:
And there are a lot of downsides with permeation enhancers.

[00:21:25] Speaker 00:
It gets rashes on your skin and things like that.

[00:21:28] Speaker 00:
So one of the things that the inventors found was that it

[00:21:32] Speaker 00:
The flux with the hydroxyl group was sufficient to make a reasonable size, even though the prior art taught away from it.

[00:21:40] Speaker 00:
And you didn't need a permeation enhancer.

[00:21:43] Speaker 00:
But Dr. Enscor relied on that definition and his knowledge.

[00:21:47] Speaker 00:
He's a very well-known formulator of transdermal products.

[00:21:52] Speaker 00:
And I believe he testified that he did the nicoderm patch.

[00:21:56] Speaker 00:
And so he testified that vinyl acetate is very well-known in the industry as this.

[00:22:01] Speaker 00:
He confirmed that through the patent.

[00:22:03] Speaker 00:
Then he looked at the in vitro testing in the patent at APPX 196 and 197.

[00:22:10] Speaker 00:
And as Mr. Hood said earlier, there were four different adhesives tested.

[00:22:19] Speaker 00:
and of the four different adhesives tested, notably if you look at table one at APPX 196, you see which functional group they have, but you also see whether they have vinyl acetate or not.

[00:22:34] Speaker 00:
And you'll see that what Dr. Enscoor did is he compared

[00:22:41] Speaker 00:
He looked at all of them.

[00:22:42] Speaker 00:
And he said, well, when you look at the two that have the carboxyl group with one having vinyl acetate and one not, that would be 2052 and 2053.

[00:22:53] Speaker 00:
Again, he said you look at three in six hours because when you look at the hydroxyl 2287, most of the drug is gone in 12 hours.

[00:23:02] Speaker 00:
So the others would be just catching up.

[00:23:03] Speaker 00:
And that's what the patent teaches you.

[00:23:05] Speaker 00:
as well in column 8.

[00:23:07] Speaker 00:
But when you look at those two, neither one of them are acceptable because you can't make a reasonably sized patch out of that.

[00:23:16] Speaker 00:
So with one having vinyl acetate and the other one not, clearly the vinyl acetate is not having a material effect on the adhesive.

[00:23:28] Speaker 00:
And then when you look at 2287, you can see that you can make a reasonably sized patch from the hydroxyl group.

[00:23:37] Speaker 00:
And then what the court said is that we had met our burden, but then the court looked as we directed the court through expert testimony.

[00:23:45] Speaker 00:
to activists' own testing data.

[00:23:49] Speaker 00:
And as this court is well aware, and the applicants test their product frequently.

[00:23:56] Speaker 00:
So when you look at the testing that was done by activists at 2724, you can see that they tested products here.

[00:24:06] Speaker 00:
They tested the one they were going to use, the accused product, 2287, in the bottom chart in Table 2.

[00:24:13] Speaker 00:
They also tested three other products that were 2196, 2677, and 2054.

[00:24:20] Speaker 00:
All of those had carboxyl groups, and all of those had vinyl acetate.

[00:24:25] Speaker 00:
And as Dr. Enscor testified, none of them

[00:24:28] Speaker 00:
are any good, you could not make a reasonably sized patch from any of them.

[00:24:32] Speaker 00:
And then when you look at 2287, which had the hydroxyl group and vinyl acetate, it was virtually indistinguishable from the branded product, and that makes sense because they copied the branded product.

[00:24:45] Speaker 00:
It's an exact duplicate.

[00:24:47] Speaker 00:
So from that,

[00:24:49] Speaker 00:
The court concluded that that evidence confirms what was in the testing and the patent, which showed that it was the functional group making the difference, and vinyl acetate did not have a material effect on the basic and novel property of flux.

[00:25:09] Speaker 00:
I will touch just a minute on the testing.

[00:25:11] Speaker 00:
So the court found that the testing was not required.

[00:25:15] Speaker 00:
And as this court knows, Martek has said that there's no absolute rule that testing is not required.

[00:25:21] Speaker 00:
The testing is required, I'm sorry.

[00:25:23] Speaker 00:
The problem here is that the question is not, is testing required or is testing not required?

[00:25:28] Speaker 00:
The question is, did we meet our burden?

[00:25:32] Speaker 00:
And the court found that the evidence we put forth, we met our burden.

[00:25:37] Speaker 00:
I believe that's at APPX 44-53.

[00:25:40] Speaker 00:
We have met our burden.

[00:25:42] Speaker 00:
The interesting thing is that their expert, Dr. Tan, relied on the same evidence to say we didn't meet our burden.

[00:25:52] Speaker 00:
And the briefs of activists say, well, it would be just as logical to go with Dr. Tan's version than it would be to go with Dr. Nscor's version.

[00:26:02] Speaker 00:
The problem with that is the judge made that fact finding.

[00:26:05] Speaker 00:
The judge found that Dr. Tan was not credible.

[00:26:08] Speaker 00:
He gave it little to no weight.

[00:26:11] Speaker 00:
And he said he was going with the evidence presented by Dr. Enscor, which was that these tests, the testing and the disclosure and the patent about the known properties of vinyl acetate, as well as what the prior art taught about vinyl acetate, we met our burden that

[00:26:31] Speaker 00:
Vinyl acetate does not have a material effect on the basic and novel property of increased penetration flux, whatever you want to call it.

[00:26:42] Speaker 00:
I don't know if Mr. Hood has waived their argument with respect to the claim construction, because if the court knows in their brief they said that the consisting essentially of means that it should be the basic and novel properties

[00:26:59] Speaker 00:
The sub part of the adhesive and not of the invention as a whole I am presuming that They are since they didn't talk about it at all that they're either not going to press that or well I wouldn't necessarily make that assumption Okay, you've got 15 minutes here, and they pick and choose what they think maybe are stronger arguments, but I'm not sure Okay, that is a waiver.

[00:27:20] Speaker 03:
Thank you

[00:27:23] Speaker 00:
Okay, so I would say that under PPG and AK Steele, they tell us that it's the invention as a whole you have to look for, because that makes sense, because you're looking at what are the basic and novel properties of the invention over the prior art.

[00:27:38] Speaker 00:
The adhesive, as they say, is the prior, it's in the prior art, it's not the new thing.

[00:27:42] Speaker 03:
Did I get those cases?

[00:27:43] Speaker 03:
I don't think AK Steele did it.

[00:27:45] Speaker 03:
The issue wasn't presented as it's presented here, right?

[00:27:49] Speaker 03:
Differentiating between whether you look at the invention or the particular limitation.

[00:27:53] Speaker 03:
I mean, you're right.

[00:27:55] Speaker 03:
In that case, too, we concluded.

[00:27:56] Speaker 03:
We compared it to the invention.

[00:27:59] Speaker 03:
But I don't recall that there was an argument made or a dispute in that case.

[00:28:05] Speaker 03:
I don't think there was either, Your Honor, but I think- So we didn't really decide that dispute, even though parties seemed to agree we were looking at the invention.

[00:28:13] Speaker 00:
Right.

[00:28:14] Speaker 00:
The law said you look at the invention as a whole, and then the court did an analysis at the markman

[00:28:20] Speaker 00:
What is that invention and what are the basic and novel properties?

[00:28:24] Speaker 00:
That's exactly what was done here.

[00:28:26] Speaker 00:
This court followed a case deal, looked at consisting essentially of, in a sub part of the claim,

[00:28:33] Speaker 00:
They looked at the invention as a whole, which was the basic and novel properties related to wetting here, even though the consisting essentially of said aluminum.

[00:28:44] Speaker 00:
That wasn't where the court was looking in terms of what were the basic and novel properties.

[00:28:50] Speaker 00:
They were looking at the invention as a whole.

[00:28:52] Speaker 00:
And that's what this court should do as well, because it would not make sense to use a piece of something that was old as looking at the basic and novel properties.

[00:29:04] Speaker 00:
So I see I have just over a minute.

[00:29:06] Speaker 00:
I'll touch very briefly on invalidity.

[00:29:09] Speaker 03:
It's a little odd simply because your friend did not raise or even cover or raise these things.

[00:29:15] Speaker 03:
Now you're, I guess, reopening his ability to respond to these two arguments that you're making.

[00:29:21] Speaker 00:
I won't raise validity.

[00:29:23] Speaker 00:
If the court has no other questions, I'll actually stop.

[00:29:28] Speaker 00:
Thank you.

[00:29:41] Speaker 04:
Thank you, your honor.

[00:29:42] Speaker 04:
I'll keep this short.

[00:29:43] Speaker 03:
I just want to be clear.

[00:29:45] Speaker 03:
You have not waived.

[00:29:46] Speaker 03:
Was I correct in presuming that you had not waived?

[00:29:50] Speaker 04:
You are correct, your honor.

[00:29:51] Speaker 04:
We have not.

[00:29:51] Speaker 04:
But we did spend our time on where we think this case really turns.

[00:29:54] Speaker 04:
And that is the infringement issue.

[00:29:55] Speaker 04:
To your question earlier, Judge Stoll, the claim construction issue at the end of the day I don't think really matters.

[00:30:00] Speaker 04:
The question here is the evidence presented at trial with respect to infringement.

[00:30:04] Speaker 04:
What we did not have

[00:30:06] Speaker 04:
is evidence of the actual effect of the 26.5% vinyl acetate in the activist hand of product.

[00:30:12] Speaker 04:
And the case, this court's case, Kim versus ConAgar.

[00:30:15] Speaker 04:
We've cited this.

[00:30:16] Speaker 04:
It's been cited and addressed from 2006.

[00:30:18] Speaker 04:
It's really the case that tells us where we're at.

[00:30:21] Speaker 04:
This was not a credit.

[00:30:22] Speaker 04:
Yes, Your Honor.

[00:30:23] Speaker 01:
Would both parties have been able to conduct a test, or was that somehow uniquely in their case?

[00:30:35] Speaker 01:
I'll just stop at that question.

[00:30:37] Speaker 04:
No, I believe the test is capable of being done, Your Honor, if that's your question.

[00:30:41] Speaker 01:
That's correct.

[00:30:41] Speaker 04:
And neither side did it.

[00:30:42] Speaker 04:
That's correct.

[00:30:43] Speaker 04:
Prostracan's burden to show it, they didn't do it.

[00:30:45] Speaker 04:
Dr. Enscor didn't explain why they didn't do it, just didn't do it.

[00:30:47] Speaker 04:
It didn't present that evidence.

[00:30:48] Speaker 01:
So our position, as in this court's case versus- Sometimes these arguments are successful, and sometimes they're not, when there's a kind of game of chicken going on.

[00:30:59] Speaker 01:
Correct, Your Honor.

[00:30:59] Speaker 01:
It happens in the absence of a particular test.

[00:31:02] Speaker 04:
Understood.

[00:31:05] Speaker 04:
Understood.

[00:31:06] Speaker 04:
And I think what the Kim v. Connaugher case tells us is that conclusory testimony, which this court characterized as Dr. Kim's expert testimony in that case about material effect of additional components in the accused product, because it doesn't test the accused product and the effect of those components,

[00:31:23] Speaker 04:
That's conclusory testimony.

[00:31:24] Speaker 04:
It doesn't satisfy the burden.

[00:31:25] Speaker 04:
So that's why our position is that burden never shifted.

[00:31:28] Speaker 04:
And this isn't about Dr. Tan versus Dr. Enscor.

[00:31:31] Speaker 04:
One thing the counsel also said here, too, was that there was a material effect test, I believe Your Honor had asked about that, and that it went unrebutted.

[00:31:43] Speaker 04:
That did not exactly go unrebutted.

[00:31:45] Speaker 04:
That's what the court said.

[00:31:47] Speaker 04:
What Dr. Tan did, however, he testified about what he believed.

[00:31:51] Speaker 04:
material effect would be.

[00:31:53] Speaker 04:
And this is in the appendix at pages 6499 to 6500.

[00:31:58] Speaker 04:
This is not a quote, but he basically said a material effect is a change to the physical and chemical structure of the adhesive that results in a change to the physical and chemical properties of the patch.

[00:32:09] Speaker 04:
And again, he was a formulator that's formulating these Durotack adhesives.

[00:32:13] Speaker 04:
And he's saying, look, if you're going to add something into this,

[00:32:16] Speaker 04:
that is going to change the physical and chemical properties of the patch, i.e.

[00:32:20] Speaker 04:
the permeation levels, you're going to have a material effect.

[00:32:23] Speaker 04:
Dr. Nscor asked by the district court, can you quantify what would be sufficient to be a material effect, 5%, 10%?

[00:32:31] Speaker 04:
He didn't answer that question.

[00:32:33] Speaker 04:
He came back with the standard that it's a large enough effect that would project that a post could make a reasonable size patch.

[00:32:39] Speaker 04:
It's simply not here.

[00:32:41] Speaker 04:
Again, at the end of the day, if you look at the tables, table two from the patent,

[00:32:46] Speaker 04:
and you look at the ANDA transfer report, we don't have quantification of vinyl acetate.

[00:32:51] Speaker 04:
Thank you very much.

[00:32:52] Speaker 04:
Thank you.

[00:32:52] Speaker 04:
We thank both sides and the case is submitted.