[00:00:00] Speaker 00:
The first case is Salonese International Corporation versus ITC, docket number 22-1827.

[00:00:09] Speaker 00:
Counselor Maynard, let me make sure that I'm correct.

[00:00:14] Speaker 00:
You have reserved three minutes of your time for rebuttal.

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

[00:00:17] Speaker 04:
Thank you.

[00:00:18] Speaker 00:
And understand that the other side is we have two arguments, one by Mr. Richards and then by Ms.

[00:00:27] Speaker 00:
Saharsky.

[00:00:29] Speaker 00:
Eight minutes and seven minutes, correct?

[00:00:31] Speaker 00:
You're splitting your time that way?

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

[00:00:34] Speaker 00:
Okay.

[00:00:34] Speaker 00:
All right, Counselor, you may proceed.

[00:00:36] Speaker 04:
Thank you, Your Honor.

[00:00:37] Speaker 04:
May it please the Court, Deanne Maynard, on behalf of Appellant Selenase.

[00:00:41] Speaker 04:
The ALJ held that under the America Invents Act, the sale of a product made by a secret process places the process on sale such that it can invalidate a later filed patent on the process under the on-sale bar.

[00:00:56] Speaker 04:
That conclusion cannot be squared with the AIA's text,

[00:00:59] Speaker 04:
And this court need go no further, so I'd like to start there.

[00:01:03] Speaker 00:
Don't we have a case that's fairly dispositive on this point, and that's Hilson?

[00:01:07] Speaker 04:
No, Your Honor.

[00:01:08] Speaker 04:
So Hilson addressed a different question.

[00:01:11] Speaker 04:
And the Supreme Court there was addressing the meaning of the words on sale and whether or not the on sale bar

[00:01:19] Speaker 04:
in the AIA captured sales that were made under an agreement of confidentiality.

[00:01:24] Speaker 04:
That's not the question here.

[00:01:25] Speaker 04:
And the court there didn't decide this question.

[00:01:29] Speaker 00:
This is a different question.

[00:01:30] Speaker 00:
The facts are different, but the legal issue is pretty much the same, wouldn't you say?

[00:01:35] Speaker 04:
No, Your Honor, it's different.

[00:01:36] Speaker 04:
Because the question here is whether the question that you hear was not in dispute in Helsing.

[00:01:41] Speaker 04:
So in Helsing, everybody agreed that the claimed invention itself was on sale.

[00:01:45] Speaker 04:
So that question was not before the Supreme Court.

[00:01:48] Speaker 04:
The question here is, what is the meaning of claimed invention in the AIA's on-sale bar provision?

[00:01:54] Speaker 04:
The claimed invention itself must be on sale.

[00:01:57] Speaker 04:
And the claimed invention here is a process.

[00:02:00] Speaker 04:
The AIA added a definition for the claimed invention.

[00:02:03] Speaker 04:
And the claimed invention under 100J.

[00:02:05] Speaker 02:
Are you contending that the meaning of the words on sale are not also applicable to this case?

[00:02:11] Speaker 04:
Well, so the question in Helson and what Helson reiterated was to be on sale.

[00:02:17] Speaker 04:
The claimed invention must be the subject of a sale and must be ready for patenting.

[00:02:21] Speaker 04:
So the question here is whether the claimed invention itself was on sale.

[00:02:24] Speaker 04:
And the answer is no, because the subject matter of the claimed invention here is a process.

[00:02:30] Speaker 04:
And the process was never on sale.

[00:02:32] Speaker 04:
Only the product made by the process was on sale.

[00:02:35] Speaker 04:
And the AIA confirms that Congress knows how to capture that conduct if it wants to.

[00:02:41] Speaker 04:
in the prior user defense in 273, Congress provided a defense.

[00:02:46] Speaker 00:
Can a secretive process be infringed?

[00:02:50] Speaker 04:
So can a secretive process be infringed?

[00:02:53] Speaker 04:
There are ways in which you could put a process on sale, if that's the question you're asking, Your Honor.

[00:02:58] Speaker 04:
So like in Scaltec.

[00:02:59] Speaker 00:
No, no.

[00:03:00] Speaker 00:
You're arguing that what's claimed here is a process.

[00:03:04] Speaker 00:
That's right.

[00:03:05] Speaker 00:
Can that claim be infringed, a secretive process?

[00:03:11] Speaker 04:
Could a claimed process be infringed?

[00:03:15] Speaker 04:
So you couldn't infringe it under 271A by selling the product of the invention.

[00:03:21] Speaker 04:
This court's made that clear.

[00:03:23] Speaker 04:
In fact, to capture that conduct, this is- So your answer is no?

[00:03:27] Speaker 04:
So you would not be infringing the claim on a process under 271A, Judge Raina, if all you did was sell the product of the process.

[00:03:36] Speaker 04:
This court's case law is long on that.

[00:03:39] Speaker 04:
And in fact, Congress passed a separate provision

[00:03:41] Speaker 04:
271G to capture that very conduct.

[00:03:45] Speaker 04:
Congress says that a process patent is infringed under 271G if a product which is made by a process patent is sold.

[00:03:56] Speaker 04:
And that's significant here and makes clear

[00:04:00] Speaker 04:
that the on-sale bar does not cover that conduct, because both 273 and 271-G make crystal clear that Congress knows how to use words.

[00:04:11] Speaker 04:
So I think those cases are not applicable to the meaning of the America Invents Act, Your Honor, which is an overhaul of the statute.

[00:04:25] Speaker 04:
And the question this court asks is, what does the language of the America Invents Act say?

[00:04:29] Speaker 04:
And if the language of the American Vince Act is clear, then the court needs to go no farther.

[00:04:34] Speaker 04:
But I think it's significant that DL Auld, which was the case that first applied the on-sale bar in circumstances similar to here, doesn't say the text requires that holding.

[00:04:48] Speaker 04:
It was the policies that the court perceived to be animating the text under the old

[00:04:53] Speaker 04:
on sale bar that led to that holding.

[00:04:56] Speaker 04:
And that's not a textual reading.

[00:04:58] Speaker 04:
That's not how we read statutes.

[00:05:00] Speaker 04:
The court has to apply the text of this statute.

[00:05:02] Speaker 04:
And in any event, to the extent that Your Honor is kind of getting at, well, wasn't there a well-settled meaning?

[00:05:06] Speaker 04:
And should the court like deem that to be reenacted akin to the way the Helsing addressed the question there?

[00:05:13] Speaker 04:
And the answer is no, for three reasons.

[00:05:16] Speaker 04:
One, the reenactment canon doesn't apply when the text is clear.

[00:05:19] Speaker 04:
Here, the text is clear on the question before the court, which is what it has to be on sale, the claimed invention.

[00:05:24] Speaker 04:
The process is not on sale.

[00:05:25] Speaker 04:
End of story.

[00:05:26] Speaker 04:
Two, the reenactment canon doesn't apply when there's no well-settled interpretation.

[00:05:30] Speaker 04:
I think it's doubtful that the Supreme Court would consider a few courts of appeals cases to be a well-settled interpretation.

[00:05:38] Speaker 04:
In the Supreme Court's decision in BP, they say a smattering of courts of appeals cases doesn't make something well-settled.

[00:05:44] Speaker 04:
and that the Supreme Court in a reenactment context doesn't feel itself to be bound to follow courts of appeals decisions that are counter to the text.

[00:05:52] Speaker 04:
But laying that aside, even if this court's precedent could theoretically make a well-settled interpretation, it can't hear because this court had adopted two different meanings of the on-sale bar in this situation, one for patentees and one for non-patentees.

[00:06:06] Speaker 04:
So there was no well-settled meaning.

[00:06:08] Speaker 04:
And to the extent one of those interpretations is consistent with the text, Your Honor,

[00:06:12] Speaker 04:
It's the one in W.L.

[00:06:13] Speaker 04:
Gore, where the court said, if Bud sold anything, Bud sold tape, not the process.

[00:06:19] Speaker 02:
Under your interpretation, when would a process be considered on sale?

[00:06:23] Speaker 04:
So I think there are two potential situations that you can clean from this court's cases, like in the case Scaltech, where what had been contracted for was to buy the process itself, the cleaning of the sludge, essentially.

[00:06:39] Speaker 04:
And also in Minton,

[00:06:41] Speaker 04:
where it was the sale of a machine whose sole purpose was to practice the process.

[00:06:47] Speaker 04:
So if you sold a machine that embodied the process.

[00:06:49] Speaker 04:
But that's not what's going on here.

[00:06:51] Speaker 00:
This is just Sweden.

[00:06:52] Speaker 00:
Those sales were confidential in Hilson, correct?

[00:06:57] Speaker 04:
No, this court held that the sale was actually public, Your Honor, that they put it in their 10Ks and things.

[00:07:02] Speaker 04:
But they had not disclosed the details of the invention.

[00:07:06] Speaker 04:
But the point here is not whether or not, the point really here is

[00:07:11] Speaker 04:
is not the question of what on sale means.

[00:07:14] Speaker 04:
The question is, what needs to be on sale?

[00:07:19] Speaker 04:
And the language makes clear that it has to be the subject matter of the patent that's on sale.

[00:07:24] Speaker 02:
Wasn't the pre-AIA 102B the template for 102A1's on sale bar?

[00:07:31] Speaker 02:
And I know that you were pointing out some distinctions that you are seeing between 102A1 and pre-AIA 102B, but is

[00:07:40] Speaker 02:
Invention really meant to be something different than claimed invention in the pre versus post-AIA.

[00:07:49] Speaker 04:
So I grant you that this court read invention largely to mean claimed invention.

[00:07:55] Speaker 04:
But the problem for the Congress is, if you want to say, no, no, we really mean it has to be the invention, how do you fix an atextual reading when you reenact a statute?

[00:08:04] Speaker 04:
This is the way you fix it.

[00:08:06] Speaker 04:
You say, no, no, we really mean claimed invention.

[00:08:09] Speaker 04:
And you add a definition that says, the claimed invention is the subject matter of the patent.

[00:08:13] Speaker 04:
So Congress doubled down on its reading of the language.

[00:08:18] Speaker 04:
And again, the case law in this court can't settle the question, because this court gave two different meanings to the text, only one of which was based on the actual text.

[00:08:28] Speaker 04:
And so if your honor thinks that you want to look at this court's case law to inform what Congress could have meant, it's the W.L.

[00:08:35] Speaker 04:
Gore line of cases, the W.L.

[00:08:37] Speaker 04:
Gore holding, where if Bud sold anything, he just sold tape.

[00:08:41] Speaker 04:
He didn't sell the process.

[00:08:42] Speaker 04:
That's comparable to what Selenase is doing here.

[00:08:45] Speaker 04:
Selenase is only selling sweetener.

[00:08:48] Speaker 04:
So there are other parts of it.

[00:08:50] Speaker 04:
And I think another thing, too, Your Honor, is to note that there aren't that many cases where this court has actually held in a holding, even under pre-AIA, that these specific facts fall under the bar.

[00:09:09] Speaker 04:
One is DL Auld.

[00:09:11] Speaker 04:
And in DL Auld, the court was really clear that it wasn't saying it actually was a sale of the process.

[00:09:17] Speaker 04:
The court just said, it's the principles animating the on-sale bar.

[00:09:22] Speaker 04:
So the court made no pretense, really, about it being a textual interpretation.

[00:09:26] Speaker 04:
And so one can't think that by converse, by reenacting, even if you think it's not a significant change, by reenacting even the same language, that that was an adoption of that a literal

[00:09:34] Speaker 04:
interpretation of the statute, especially when this court had a literal interpretation of the statute.

[00:09:39] Speaker 00:
Why wouldn't the public sell of the products that are made using a secretive process, why wouldn't that be a disclosure under Section 102B?

[00:09:50] Speaker 04:
Be a disclosure under the new 102B?

[00:09:53] Speaker 04:
Yes.

[00:09:54] Speaker 04:
So the public sale of a secret process?

[00:09:59] Speaker 00:
Yes.

[00:10:00] Speaker 04:
because it doesn't disclose the patented invention to anyone.

[00:10:03] Speaker 04:
So that's unlike Helsin, where the sale was when the sale was public.

[00:10:09] Speaker 04:
But two, the invention had been disclosed to the buyer there.

[00:10:11] Speaker 00:
Nobody disputed that.

[00:10:12] Speaker 00:
The sales of the product is public.

[00:10:16] Speaker 04:
Yes, the sales of the product in Helsin are here.

[00:10:20] Speaker 00:
No, I mean here in New York.

[00:10:21] Speaker 04:
Yeah, here, but just the sweetener, Your Honor.

[00:10:23] Speaker 04:
The process itself has been disclosed to no one, which is distinct from Scaltech, where the process had been disclosed to the buyer.

[00:10:29] Speaker 00:
which is distinct from Minton, where if the machine does nothing about performance, the process is sold to... But the sales of the products using that process is public.

[00:10:38] Speaker 00:
Yes.

[00:10:38] Speaker 00:
Why isn't that a public disclosure under Section 102B?

[00:10:44] Speaker 04:
A public... So are you talking about the defense or a public use, like under 102A?

[00:10:50] Speaker 00:
Well, let's say public use.

[00:10:51] Speaker 04:
Well, it's not a public use, because this Court has held that keeping a process secretive is not a public use.

[00:10:57] Speaker 04:
It isn't known to anybody.

[00:10:59] Speaker 04:
One of our other arguments is that the other side's reading and the Commission's reading can't be squared with the structure of the statute.

[00:11:07] Speaker 04:
Because the structure of the statute, and this may be what you're getting at, Judge Rina, the structure of the statute reinforces our reading, because it provides a one-year grace period for a patent applicant to make certain disclosures.

[00:11:18] Speaker 04:
But in this situation, where you just sell a sweetener and it tells you nothing about the process made to produce the sweetener, it doesn't disclose the invention to anyone.

[00:11:28] Speaker 04:
And so our reading coheres with this statutory scheme, because ours wouldn't be called by the on-sale bar.

[00:11:36] Speaker 04:
And so we wouldn't need the one-year grace period.

[00:11:39] Speaker 04:
But under the other side's reading, there's an anomaly in the structure of the statute.

[00:11:44] Speaker 04:
And so it's telling that the ITC and JENA have two different ways to explain away.

[00:11:48] Speaker 04:
They don't agree how to explain away this problem, which I think is telling.

[00:11:51] Speaker 00:
How does the Woodland Trust case fit in here?

[00:11:55] Speaker 04:
So Woodland Trust was a different situation, Your Honor.

[00:11:58] Speaker 04:
It didn't face this question, the sale of a product by a secret process.

[00:12:03] Speaker 04:
The question there was about the

[00:12:08] Speaker 04:
the way to keep plants from freezing, if I recall correctly.

[00:12:11] Speaker 04:
And it had been in public use.

[00:12:13] Speaker 04:
And other people were publicly using the process.

[00:12:15] Speaker 04:
So that would be a different question.

[00:12:16] Speaker 04:
Everybody, they haven't made a public use argument here.

[00:12:18] Speaker 04:
And everybody agrees that cellanies have.

[00:12:20] Speaker 00:
It also said on sale.

[00:12:23] Speaker 04:
It also said on sale.

[00:12:25] Speaker 04:
Yeah.

[00:12:26] Speaker 04:
But I think they're the process may have.

[00:12:28] Speaker 04:
To the extent it did, Your Honor, I thought it was a public use case.

[00:12:30] Speaker 04:
But to the extent I'm wrong, it was distinct from the facts here, where the process is not known.

[00:12:36] Speaker 04:
The process is not on sale.

[00:12:37] Speaker 04:
There the process was publicly known.

[00:12:39] Speaker 04:
The facts of that case are not on fours with ours.

[00:12:42] Speaker 04:
And we're not saying there can't be sales of process patents.

[00:12:47] Speaker 04:
We're just saying of subject matter.

[00:12:49] Speaker 04:
Yes, Your Honor.

[00:12:50] Speaker 02:
Are you relying on legislative history to support your interpretation?

[00:12:54] Speaker 02:
And if so, what would be your best piece?

[00:12:56] Speaker 04:
So mostly we're just saying that the ITC, to the extent the commissioner, the ALJ relied on legislative history,

[00:13:05] Speaker 04:
you know, he misread it, that those senators did in fact, the senators that we are relying on the floor statements of, they did in fact support the ultimate passage.

[00:13:14] Speaker 04:
I think the purpose of this, as you know, this changed it to a first-to-file system, which does address many of the concerns that this court expressed with respect to this particular fact situation.

[00:13:26] Speaker 04:
But in any event, you know, with the text is clear, the legislative history has no role.

[00:13:30] Speaker 00:
Doesn't your argument lead us to a point to

[00:13:33] Speaker 00:
where we began to move away from the foundation for exclusivity.

[00:13:42] Speaker 00:
And I'm talking about the dedication to the public of something in return for that exclusivity.

[00:13:48] Speaker 00:
And here, if the process remains secretive, but yet you get to continue selling products made by that process, you have advantage of the exclusivity, but you haven't dedicated anything to the public.

[00:14:00] Speaker 04:
So actually, Your Honor, our reading does encourage people who are protecting their processes by trade secrets to patent them.

[00:14:06] Speaker 04:
And that's what we did here.

[00:14:07] Speaker 04:
On our reading of the statute, this would be protected.

[00:14:10] Speaker 04:
If we wanted to keep it never dedicated to the public, we could have just kept it as a trade secret.

[00:14:16] Speaker 04:
But under our reading of the statute, it actually encourages parties to apply for a patent, disclose the patent, and have that for a limited time.

[00:14:23] Speaker 00:
OK.

[00:14:24] Speaker 00:
You need to rebuttal time.

[00:14:25] Speaker 04:
Thank you so much.

[00:14:27] Speaker 00:
Thank you.

[00:14:41] Speaker 00:
Councilor Richards, do you have eight minutes?

[00:14:44] Speaker 01:
Yes, sir.

[00:14:44] Speaker 01:
May it please the court?

[00:14:46] Speaker 01:
The sole question for the commission below and this court now is, did Congress change what it means for a process to be on sale when it enacted the AIA?

[00:14:57] Speaker 01:
The answer to that question clearly has to be no, given the unanimous holding in Helsing that Congress did not alter the meaning of on sale when it enacted the AIA.

[00:15:08] Speaker 00:
There, there...Helson has some points that could be argued, apply in this case, but there's other points in Helson that could equally be argued, perhaps even more so, that Helson doesn't apply in this case.

[00:15:21] Speaker 00:
Is it, is...Helson, how does it apply?

[00:15:24] Speaker 00:
Is it dispositive here?

[00:15:25] Speaker 01:
The commission's position is just positive, Your Honor.

[00:15:28] Speaker 01:
And I'd like to explain a little bit more maybe by touching on the points we just heard to sort of flesh this out.

[00:15:34] Speaker 01:
I think sort of the main dispute I'm hearing is that the issue is it on sale or is it claimed invention?

[00:15:40] Speaker 01:
Which words are we looking at?

[00:15:41] Speaker 01:
The court should be looking at the words on sale.

[00:15:45] Speaker 01:
There is no dispute here about what the claimed invention was.

[00:15:48] Speaker 01:
It was the process.

[00:15:50] Speaker 01:
The commission held that the process was on sale.

[00:15:53] Speaker 01:
And the commission's holding in that regard is completely on all fours with this court's binding precedents.

[00:15:58] Speaker 01:
The commission had no other option.

[00:16:01] Speaker 01:
What I'd point you to specifically about that are two cases particularly.

[00:16:05] Speaker 01:
It's both.

[00:16:07] Speaker 00:
How do you square your argument that the process was on sale when the process is secretive?

[00:16:15] Speaker 01:
So what this court has said, first in Kolar, and then again most recently in 2020 in BASF,

[00:16:22] Speaker 01:
is that the way you put a process on sale, it is acknowledged at least two ways.

[00:16:27] Speaker 01:
One is the Scaltech way, which I think I heard my friend acknowledge that Selenese will agree absolutely puts a process on sale.

[00:16:35] Speaker 01:
And the other way is by selling a product made with that process.

[00:16:39] Speaker 01:
One thing I wanted to call the court's attention to is when this court sat on Bonk and medicines, it explained that the

[00:16:49] Speaker 01:
These were really two halves of the same coin.

[00:16:52] Speaker 01:
The quote specifically is, in DLL, the patentee offered to sell a product made by the claimed method to prospective customers, i.e., it offered to practice the method in return for compensation.

[00:17:05] Speaker 01:
So in medicines, the en banc court explained that it's not, as Celanese contends, two completely different sort of forms of selling a process.

[00:17:12] Speaker 01:
They're two sides of the same coin.

[00:17:15] Speaker 01:
So to the extent that Selenese has acknowledged now that a Scaltech sale sells a process, under this court's reasoning in medicines, that pretty much ends the case.

[00:17:25] Speaker 01:
Because the Scaltech-type sale and the sale of a product made by the process really are one and the same thing.

[00:17:32] Speaker 02:
What is your response to the fact that the language changed from invention to claimed invention?

[00:17:39] Speaker 01:
Yeah, so what I'd like to point out about that, Your Honor, is one, again, I think I heard my friend acknowledge

[00:17:45] Speaker 01:
This court had already been consistently applying the claimed invention definition.

[00:17:50] Speaker 01:
As far as what we can glean from what Congress intended, I've been through the legislative history.

[00:17:56] Speaker 01:
The only explanation I can find there at all comes from the House report from 2007.

[00:18:01] Speaker 01:
It acknowledges on page 55.

[00:18:06] Speaker 01:
And the citation here is House Rep 110-314.

[00:18:11] Speaker 01:
page 55, it notes that these definitions were added.

[00:18:14] Speaker 01:
And it says they were added to bring clarity and meaning and application of the terms in the context of a first file system.

[00:18:24] Speaker 01:
The other thing, so there's nothing in there addressing this on-sale issue in processes.

[00:18:29] Speaker 01:
The suggestion that that was specifically put in there to address this issue just has no support that I'm aware of.

[00:18:35] Speaker 01:
To go a step further though, 102A is not the only place that claimed invention shows up in the AIA.

[00:18:42] Speaker 01:
It also shows up in 103, the obviousness section.

[00:18:45] Speaker 01:
So to the extent that suggests that Congress introduced claimed invention to totally address this 102A problem, I think that undercuts that idea, because claimed invention is used elsewhere also.

[00:19:00] Speaker 01:
I wanted to touch briefly.

[00:19:01] Speaker 01:
I think, Judge Raina, you asked a question about whether secret processes can be infringed under 271.

[00:19:07] Speaker 01:
To the extent I understood your question, the answer is yes.

[00:19:10] Speaker 01:
271 is broad.

[00:19:12] Speaker 01:
It includes more than just on sale as a means

[00:19:15] Speaker 01:
triggering infringement.

[00:19:17] Speaker 01:
So to the extent, you know, what Selenese is working towards is a mismatch between, you know, sort of grounds of invalidity and grounds of infringement, I think that is where we're headed.

[00:19:28] Speaker 01:
Because the secret process is absolutely keeping it infringed.

[00:19:31] Speaker 01:
The patent holders can seek infringement damages for them.

[00:19:35] Speaker 01:
But this would absolutely, if Selenese's tact was taken, this would absolutely reduce the number of ways that they're subject to patentability requirements.

[00:19:46] Speaker 01:
I know there was a question about 102B being the template.

[00:19:54] Speaker 01:
That is also the case we know from the same House report I mentioned before.

[00:19:59] Speaker 01:
That's House report 110-314, and that's page 57.

[00:20:04] Speaker 01:
That's about one paragraph you'll find there.

[00:20:07] Speaker 01:
And the House report is very clear.

[00:20:09] Speaker 01:
The point of adopting 102B and the language of on sale there was because there were settled meanings to it.

[00:20:17] Speaker 01:
Where the court should sort of take that in the greater scheme of the arguments it's hearing is to the extent that Selenese has argued that the floor statements from three or four members of Congress sort of represent the whole sense of Congress here.

[00:20:31] Speaker 01:
That's just not the case.

[00:20:33] Speaker 01:
And this House report pretty much makes that point expressly.

[00:20:37] Speaker 01:
I want to point out that Selenese is not comparable to Budd in W.L.

[00:20:42] Speaker 01:
Gore.

[00:20:44] Speaker 01:
Budd in W.L.

[00:20:44] Speaker 01:
Gore was a third party.

[00:20:46] Speaker 01:
And I don't think this court needs to read W.L.

[00:20:48] Speaker 01:
Gore any further than what it said, which is the traditional rule that's memorialized in textbooks and treatises, which is that a non-patenty third party's use of a patented method to make a product that it then sales does not put the process on sale.

[00:21:06] Speaker 01:
Right.

[00:21:06] Speaker 01:
That's not Selenese, because Selenese is the patentee here.

[00:21:11] Speaker 02:
Do you believe that Congress intended the 102B grace period to be coextensive with 102A1's prior art categories?

[00:21:20] Speaker 01:
I have to note, for the commission, this issue wasn't raised below.

[00:21:23] Speaker 01:
And I apologize, but I need to be careful not to suggest the commission decided something it didn't.

[00:21:31] Speaker 01:
What I can say is that, again, pointing to that same portion

[00:21:36] Speaker 01:
Well, actually pointing to the floor statements from the senators that Selanese relies on, Senator Leahy said very clearly, we intend that if an inventor's actions are such as to constitute prior art under Section 102A, then those actions necessarily trigger Section 102B's protections for the inventor.

[00:21:59] Speaker 01:
He goes on to re-emphasize the same thing.

[00:22:01] Speaker 01:
Section 102B1A as written was deliberately captioned.

[00:22:05] Speaker 02:
Can you tell me where you're reading from, precisely?

[00:22:07] Speaker 01:
Yes, this is 157 Congressional Record from the Senate 1496.

[00:22:15] Speaker 01:
And there's two more statements, essentially, to the same effect there.

[00:22:22] Speaker 01:
The final point I wanted to make is I heard that the rule Selanese is advocating for would promote the dedication of inventions to the public.

[00:22:32] Speaker 01:
I would submit that at least if we look at the amicus brief that was filed here, that's not the case.

[00:22:36] Speaker 01:
I think the National Association of Manufacturers brief makes it very clear that what they are seeking is for this court to overturn the long-held rule that you have to choose between secrecy or exclusivity under a patent.

[00:22:51] Speaker 01:
Your Honours, unless you have more questions, I'll be happy to sit down.

[00:22:54] Speaker 01:
Thank you.

[00:22:55] Speaker 01:
Thank you, Your Honours.

[00:23:03] Speaker 00:
Councillor, you've got seven minutes.

[00:23:10] Speaker 03:
Good morning, I'm Nicole Saharsky for the interveners.

[00:23:13] Speaker 03:
I just would like to make three overarching points based on the discussion that's happened so far this morning.

[00:23:19] Speaker 03:
First of all, there is no dispute between the parties about the meaning of claimed invention.

[00:23:24] Speaker 03:
We all agree that the claimed invention is the process.

[00:23:27] Speaker 03:
And the question is, what does it mean for the process to be on sale?

[00:23:32] Speaker 03:
We understand that Congress, when it said claimed invention, did not have any change from what this court, what previously said invention in the statute and that this court interpreted as claimed invention.

[00:23:41] Speaker 03:
And you can look to this court's precedents, including, for example, the Phillips case that's cited in the commission's brief

[00:23:47] Speaker 03:
that makes clear that the words word invention in the old statute and claimed invention always meant the same thing.

[00:23:53] Speaker 03:
So second, that means the question here is, what does it mean for a process to be on sale?

[00:23:57] Speaker 03:
And this court has a long history, a long string of cases that were based also on the Supreme Court's case and Penick and on the Second Circuit's case and metalizing.

[00:24:07] Speaker 03:
And those cases all explain how a process is on sale, that a process is on sale when a product made using that process is sold.

[00:24:14] Speaker 03:
And it's not just that the court's case has held this and kept repeating it.

[00:24:17] Speaker 03:
It's that they explained why this is true, that for a process patent, the court explained, for example, in Kolar, TEDL doesn't pass the same way as it does with a physical object.

[00:24:27] Speaker 03:
And so the question is, how is the inventor commercializing the invention?

[00:24:32] Speaker 03:
How is the inventor benefiting from this invention?

[00:24:35] Speaker 03:
And the court has said that the process is on sale either when you perform the process for money or sell a product made using the process.

[00:24:42] Speaker 03:
And if you look at the patent in this case, I think it makes complete sense.

[00:24:45] Speaker 03:
This patent is for a process to make a product.

[00:24:48] Speaker 03:
So of course, when the product is on sale, that is giving the inventor the benefit of that invention, commercializing that invention.

[00:24:55] Speaker 03:
And so if we just look at this court's cases that have addressed this exact situation, we've got the DL Auld case, the Kohler case, the BASF case more recently, the Cavaney case that the commission relied upon.

[00:25:08] Speaker 03:
This is settled law in this circuit.

[00:25:11] Speaker 03:
It also includes the Woodland Trust case,

[00:25:13] Speaker 03:
which was mentioned earlier, that the Supreme Court itself cited in the Helsing decision as one of the pre-existing decisions of this circuit that Congress understood to be the law and wanted to remain the law after the AIA.

[00:25:27] Speaker 03:
So really, we've got not only this court understanding that the situation here is a process on sale, but the US Supreme Court citing the Woodland Trust case, citing the metalizing case in the Pfaff decision,

[00:25:41] Speaker 03:
and having its own decision in Pennock, which was about a process.

[00:25:44] Speaker 03:
So Celany's position really means overturning decades of this court's precedent and disregarding the Supreme Court's holding in Helsing about what it means to be on sale.

[00:25:53] Speaker 00:
Your friend on the other side argues extensively concerning the text that surrounds the AIA.

[00:26:02] Speaker 00:
Can you respond to that?

[00:26:04] Speaker 03:
Sure.

[00:26:04] Speaker 03:
So I think the primary argument that's made is about the words claimed invention.

[00:26:08] Speaker 03:
And so our position is that there's no dispute that that is the process and that that didn't change with the AIA.

[00:26:14] Speaker 03:
There are arguments made about Section 102A and 102B, where 102B is the grace period.

[00:26:20] Speaker 03:
And to answer the question that was asked, we understand those to be coextensive, that if something is listed in 102A and it's within the one-year grace period, it shall not be prior art.

[00:26:31] Speaker 03:
And I think you can tell that they're linked together because

[00:26:34] Speaker 03:
B says that it shall not be prior art under section A1.

[00:26:38] Speaker 03:
So B itself is linking the text to A1.

[00:26:42] Speaker 03:
Salonese also makes arguments based on sections 271 and 273.

[00:26:46] Speaker 03:
I would just note that those aren't changes that were made with the AIA.

[00:26:50] Speaker 03:
That's language that existed before the AIA.

[00:26:53] Speaker 03:
And so they're coming to this court saying that the AIA is a reason to revisit this court's prior precedent.

[00:26:59] Speaker 03:
But those aren't changes that are new with the AIA.

[00:27:01] Speaker 03:
I think those are the main textual arguments that they are making.

[00:27:06] Speaker 03:
And I guess the third overriding point I wanted to make is that Selenese is doing exactly what the on-sale bar was intended to prevent, which is keeping something secret, the inventor making money off of it, commercializing it, waiting to seek a patent in order to extend the monopoly.

[00:27:21] Speaker 03:
I think the NAM amicus brief is unabashed that that's the rule that they want, and Selenese does not dispute that that's what they're doing here.

[00:27:28] Speaker 03:
And so where I think this leaves us is you've got a position from Selenese that is contrary to Helsing, contrary to this court's precedents.

[00:27:38] Speaker 03:
You'd have to overturn decades of this court's precedents that are not just the holdings, but an explanation of why there is this rule about how a process is on sale.

[00:27:48] Speaker 03:
I also think Selenese's position would leave a gaping hole in the on sale bar, because how would a process be on sale?

[00:27:54] Speaker 03:
I mean, if you look at all the courts

[00:27:55] Speaker 03:
all the cases that this court has, there's the one case that's about performing the process for money.

[00:28:01] Speaker 03:
But all the other cases are about selling a product that was made using the patented process.

[00:28:06] Speaker 03:
And so I think it would make the on-sale bar almost meaningless in the context of process inventions.

[00:28:12] Speaker 03:
And again, you'd be allowing selenies to do exactly what the on-sale bar was designed to prevent.

[00:28:18] Speaker 03:
So I'm happy to answer any further questions that the court might have.

[00:28:23] Speaker 02:
Yes, I have a few questions.

[00:28:23] Speaker 02:
Sure.

[00:28:25] Speaker 02:
How do you respond to opposing Helson's argument that Helson is distinguishable here?

[00:28:32] Speaker 03:
Well, I think there are two arguments that they make.

[00:28:34] Speaker 03:
One is that they say Helson doesn't address claimed invention.

[00:28:37] Speaker 03:
And that's true.

[00:28:38] Speaker 03:
But claimed invention is not a disputed term between the parties.

[00:28:41] Speaker 03:
We all agree that it's the process.

[00:28:43] Speaker 03:
And the definition of invention that this court had before the AIA is the same as the definition of claimed invention in the AIA.

[00:28:51] Speaker 03:
And there's no reason to believe that Congress intended a change there.

[00:28:54] Speaker 03:
The Supreme Court in Helsin said that adding otherwise available to the public was too obscure to change the on-sale bar.

[00:29:00] Speaker 03:
So I would submit that claimed invention would be way too obscure to change the on-sale bar.

[00:29:06] Speaker 03:
And then I think their second argument is that the facts of this case are not the same as the facts of Helsin.

[00:29:12] Speaker 03:
And that's true.

[00:29:13] Speaker 03:
They're different facts.

[00:29:14] Speaker 03:
But I would say two things in response to that.

[00:29:17] Speaker 03:
First, the reasoning of Helsin, the question that was answered is,

[00:29:21] Speaker 03:
Did Congress change the meaning of on sale, or did it continue to embrace this court's prior precedents?

[00:29:27] Speaker 03:
And the Supreme Court held emphatically that Congress did not change the meaning of on sale when it enacted the AIA.

[00:29:33] Speaker 03:
And then the second point is, it's not only this court's precedents about selling products.

[00:29:39] Speaker 03:
The Supreme Court actually cited the Woodland Trust case as one of the Federal Circuit's precedents that have long held that secret sales can invalidate a patent.

[00:29:48] Speaker 03:
While it was not the exact factual situation that was before the Supreme Court in Helsing, the citation to the Woodland Trust case certainly, which is about the secret process in selling the product, I think is certainly strong evidence that the Supreme Court was aware of this court's rules.

[00:30:04] Speaker 00:
OK.

[00:30:04] Speaker 00:
Thank you.

[00:30:04] Speaker 03:
Thank you.

[00:30:09] Speaker 00:
Will we restore your time to the three minutes?

[00:30:13] Speaker 04:
Thank you, Your Honor.

[00:30:14] Speaker 04:
I appreciate it.

[00:30:14] Speaker 04:
I'll make several quick points.

[00:30:16] Speaker 04:
One, we're not just relying on claimed invention.

[00:30:18] Speaker 04:
It's the language of claimed invention change.

[00:30:20] Speaker 04:
And again, I'll just reiterate, how is Congress supposed to reiterate what they mean is what they mean when this court has had an atextual interpretation?

[00:30:28] Speaker 04:
Two, we know Congress, 273 and 271G.

[00:30:31] Speaker 04:
Congress knows how to capture this conduct in precise terms if it wants to.

[00:30:35] Speaker 04:
And it did not add language like that to the on-sale bar provision.

[00:30:39] Speaker 04:
And counsel says that 273, that language, and the language was already there.

[00:30:44] Speaker 04:
One, that doesn't matter.

[00:30:45] Speaker 04:
The Supreme Court looks at the statute as a whole to see if Congress knows how to say the thing at issue, and here it does.

[00:30:52] Speaker 04:
And significantly, in fact, in 273, that was included in the AIA and modified and reiterated.

[00:31:00] Speaker 04:
So it wasn't just already there.

[00:31:02] Speaker 04:
Three, the grace period provision makes sense under eye reading, under their reading.

[00:31:08] Speaker 04:
They're going to agree that this can be a disclosure, Your Honor, but what they're doing is reading disclosure to mean the opposite of what it is, that something that doesn't disclose the patented invention, the patented process at all, is a disclosure.

[00:31:21] Speaker 04:
So to make up for their atextual reading of the on sale bar provision, they're trying to adopt an atextual reading of the grace period.

[00:31:28] Speaker 04:
That's not the way you do statutory interpretation.

[00:31:32] Speaker 04:
If you construe them both according to the text, they work together.

[00:31:36] Speaker 04:
Three, there are only two, maybe three cases that have been cited by the parties here that I think would come out to a different answer under our understanding of this provision.

[00:31:49] Speaker 04:
One is DL Auld, which was not a text-based decision.

[00:31:52] Speaker 04:
And the other is Dippin' Dots.

[00:31:54] Speaker 04:
which doesn't analyze the text either.

[00:31:57] Speaker 04:
D-L-A-D, A-U-L-D, Your Honor.

[00:32:00] Speaker 04:
And the second one is dip and dots.

[00:32:01] Speaker 04:
And then arguably, quest integrity, which was post the passage of the AA, but interpreting pre-interpretation.

[00:32:09] Speaker 04:
But it's unclear from the facts there whether that's really more like a Skaltec situation, where we do think the process could be on sale.

[00:32:17] Speaker 04:
So this is not like overturning against a wide range of precedent.

[00:32:21] Speaker 04:
There's a lot of dicta, but the Supreme Court says dicta cannot.

[00:32:24] Speaker 04:
to make well-established law.

[00:32:27] Speaker 04:
Your Honor, to come back to your question about Woodland, Woodland was a public use case.

[00:32:31] Speaker 04:
And the holding in Woodland was reversal of invalidity.

[00:32:34] Speaker 04:
So that's not the situation.

[00:32:37] Speaker 04:
And to the extent that the Supreme Court did cite it, as they did, they cited it for a different purpose, not relevant here.

[00:32:43] Speaker 04:
We would request that you reverse.

[00:32:45] Speaker 00:
OK, thank you.

[00:32:46] Speaker 04:
Thank you.

[00:32:48] Speaker 00:
We thank the parties for their arguments.