[00:00:00] Speaker 03:
We have three argued cases this morning.

[00:00:02] Speaker 03:
The first is number 23-1217, US Synthetic Court versus ITC, Mr. Cooley.

[00:00:10] Speaker 04:
May it please the court.

[00:00:11] Speaker 04:
The Supreme Court has warned that courts must tread carefully when applying the judicial exceptions to Section 101, lest they swallow all of patent law.

[00:00:20] Speaker 04:
This case raises that precise concern.

[00:00:23] Speaker 04:
International Trade Commission found the US Synthetic's claim to a polycrystalline diamond compact

[00:00:29] Speaker 04:
was ineligible for patent protection because it was directed to an abstract idea.

[00:00:33] Speaker 04:
However, the seminal Supreme Court decision in Diamond and Chakrabarti bears directly on this issue.

[00:00:40] Speaker 04:
Under Chakrabarti, US synthetics claims composition is patent eligible, and the ITC must be reversed.

[00:00:47] Speaker 00:
Counsel, there's a two-part test under Supreme Court precedent.

[00:00:52] Speaker 00:
There's Alice step one and Alice step two.

[00:00:55] Speaker 00:
What step do you think best applies to your case and explaining why you think that your claim is eligible?

[00:01:05] Speaker 04:
Your Honor, we think that step one, we think that the composition is eligible under both steps, but we think certainly so under step one regarding what the composition is directed to.

[00:01:16] Speaker 04:
Now under relevant law under step one and fish,

[00:01:20] Speaker 04:
The court must consider the character as a whole of the claimed invention.

[00:01:25] Speaker 04:
And here, the character as a whole of the claimed invention is a composition of matter.

[00:01:31] Speaker 04:
And that composition is defined in part by its constituent elements, including carbon, which is diamond, and cobalt.

[00:01:39] Speaker 04:
And it is also defined by the properties of the material as a whole.

[00:01:44] Speaker 04:
And those include cobalt.

[00:01:45] Speaker 03:
But you describe in your brief

[00:01:47] Speaker 03:
and describe in the specification that the invention here is using this 7.5% pressure level.

[00:01:56] Speaker 03:
It's not described as being the composition.

[00:02:00] Speaker 03:
What are we to make of that?

[00:02:02] Speaker 04:
Your honor, it is true that the specification does describe the process of producing the ultimate composition.

[00:02:11] Speaker 04:
And that process is described as using 7.5.

[00:02:14] Speaker 03:
And that's described as the invention, right?

[00:02:17] Speaker 04:
That is part of the invention, and it is one of the inventions.

[00:02:20] Speaker 04:
It's the process of making the composition.

[00:02:22] Speaker 04:
But the composition itself is also invented.

[00:02:26] Speaker 04:
As Section 101 itself recognizes, inventors are able to claim

[00:02:30] Speaker 04:
their inventions as methods, processes, and also as compositions of matter.

[00:02:36] Speaker 04:
And that is the precise issue that Diamond Beach Chakrabarti approached in its case.

[00:02:42] Speaker 05:
Mr. Cooley, is it your view that no composition of matter claim could ever be subject to the abstract idea exception?

[00:02:50] Speaker 04:
That is not our position, Your Honor.

[00:02:53] Speaker 04:
Our position is, if one looks at Chakrabarti

[00:02:57] Speaker 04:
The issue of eligibility for a composition like ours is settled law.

[00:03:01] Speaker 05:
But Chakrabarti was more about whether a claim was to an ineligible product of nature.

[00:03:09] Speaker 05:
And it didn't really consider the question of abstract ideas.

[00:03:13] Speaker 05:
And that's what we have to deal with here.

[00:03:18] Speaker 05:
curious to learn is what is the dividing line between a composition of matter claim that's ineligible as an abstract idea versus a proper composition of matter.

[00:03:31] Speaker 05:
Because I think we just agreed that composition of matter claims are subject to the abstract idea exception.

[00:03:38] Speaker 05:
So what's the dividing line?

[00:03:40] Speaker 05:
How should we understand what's the framework we should use?

[00:03:45] Speaker 04:
So I would have two answers, Your Honor, to your question.

[00:03:47] Speaker 04:
And the first answer would be, I do believe that Chakrabarti discusses all of the judicial exceptions, including abstract idea.

[00:03:56] Speaker 04:
It discusses in its later pages the application of fluke, indeed, which is a case that most people would put under the abstract idea framework, and notes that they had considered that issue there.

[00:04:07] Speaker 04:
And so I would say that Chakrabarti does consider all of the judicial exceptions and sets out the framework for analyzing

[00:04:14] Speaker 04:
compositions.

[00:04:16] Speaker 04:
But nonetheless, I would say that even if we were to step aside and look at other precedents, such as the Alice Mayo framework, which incorporates Chakrabarti as part of that, the invention is nonetheless eligible because it is of what it's directed to, and it's directed to the composition.

[00:04:37] Speaker 04:
And if you look at the claim elements as we must under the proper test,

[00:04:41] Speaker 04:
You can see the interrelationship between them.

[00:04:44] Speaker 04:
So as I noted, you have the constituent elements.

[00:04:47] Speaker 04:
You also have the properties, which are related to each other as a whole.

[00:04:51] Speaker 04:
And one cannot simply divorce out one magnetic property and say, we'll analyze that in isolation.

[00:04:58] Speaker 03:
Well, I'm not sure that I understand your answer to Judge Chen's question.

[00:05:01] Speaker 03:
What is the dividing line in terms of a compositional matter claim between those that are abstract and those that aren't?

[00:05:08] Speaker 03:
What is the test?

[00:05:11] Speaker 04:
The test would be, well, let's look first, I think, at Chakrabarti talks about something as markedly different characteristics and the potential for significant utility.

[00:05:21] Speaker 05:
That's markedly different characteristics compared to what exists in nature.

[00:05:25] Speaker 05:
Again, that was the product of nature analysis.

[00:05:28] Speaker 05:
We're dealing with a different exception to patent eligibility.

[00:05:32] Speaker 05:
That's the abstract idea exception.

[00:05:34] Speaker 05:
I know you want to talk about Chakrabarti, but what I'm really interested in understanding is thinking about this case more through the Alice Mayo framework and thinking about step one, step two.

[00:05:44] Speaker 05:
Why is this claim not directed to an abstract idea?

[00:05:49] Speaker 05:
When we've set up a framework for step one, where we've said to figure out whether a claim is directed to an abstract idea, we ask ourselves, what is the claimed advance recited in the claim over the prior art?

[00:06:04] Speaker 04:
Certainly.

[00:06:05] Speaker 04:
And here, again, the claimed advance over the prior art is that the properties, if we're referring to the facts of this case specifically,

[00:06:14] Speaker 04:
the properties of the material as a whole perform better than the prior art materials.

[00:06:19] Speaker 04:
And that is an undisputed fact in this case.

[00:06:22] Speaker 00:
Council, can I just answer another question, which is the wearing clauses, they refer to wearing the un-washed portion of the polycrystalline diamond table exhibits a cursivity of a particular amount.

[00:06:40] Speaker 00:
That's one example.

[00:06:41] Speaker 00:
I think that the commission found that to be functional.

[00:06:46] Speaker 00:
Could you explain why that is not functional or whether it is functional language?

[00:06:52] Speaker 04:
It is not functional language, Your Honor.

[00:06:54] Speaker 04:
We would characterize that as definitional language.

[00:06:57] Speaker 04:
It's commonplace in the chemical and material arts to define a composition by not only what it is,

[00:07:04] Speaker 04:
but by the properties that it has.

[00:07:07] Speaker 04:
And we saw that the amicus pharma filed a brief speaking to exactly this point.

[00:07:12] Speaker 04:
And herein, the composition is defined not only by components which are in it, which are in the clang, but also by the material properties that are inherent to that composition, including its coercivity, magnetic saturation, and specific permeability.

[00:07:28] Speaker 04:
And these are properties that one cannot merely, referring back to the question about Alice, you know, one cannot merely divorce from the material like one would divorce a software or delete a software from a computer.

[00:07:42] Speaker 04:
And so the, under that Alice Mayo framework, those sorts of cases are not on point to this sort of a scenario where you have constituent parts that are integrally and necessarily intertwined.

[00:07:56] Speaker 04:
And I would note that the constituents are not only related to the composition, but they're related to each other.

[00:08:02] Speaker 04:
As you look at coercivity, coercivity defines a relationship which relates to the mean free path and the degree of diamond to diamond vomiting, which is impacted by the diamond grain size.

[00:08:14] Speaker 04:
Diamond grain size and coercivity both claim delicacy.

[00:08:17] Speaker 00:
Is that in the claim itself?

[00:08:19] Speaker 04:
Excuse me, the relationship?

[00:08:22] Speaker 00:
It's not.

[00:08:22] Speaker 00:
It is not in the claim.

[00:08:23] Speaker 00:
Does it have to be?

[00:08:25] Speaker 04:
I do not believe so, Your Honor.

[00:08:26] Speaker 04:
What's in the claim is the definition of the material.

[00:08:30] Speaker 04:
The beneficial aspects or the objectives are not claimed, which is perfectly consistent with a case like Leroy B. Tatham.

[00:08:39] Speaker 04:
We did not come out and claim an original objective, an original motive, or something to that effect.

[00:08:44] Speaker 04:
we claimed the material itself according to its constituent parts and properties.

[00:08:50] Speaker 00:
How would someone be able to determine whether the polycrystalline table actually had that corrosivity as we started doing the claim?

[00:09:01] Speaker 04:
How would someone determine if it had that?

[00:09:04] Speaker 04:
Well, one way to determine it would be to test it.

[00:09:07] Speaker 04:
In the specification, it outlines international standards

[00:09:11] Speaker 04:
that are recognized ASTM standards for measuring coercivity and magnetic saturation.

[00:09:17] Speaker 04:
And then specific permeability is nearly the ratio of those two things.

[00:09:21] Speaker 05:
So would you have us say that any composition of matter claim that recites a property of any kind, any kind of range value for a property is necessarily patent-eligible and not an abstract idea?

[00:09:38] Speaker 04:
I don't know if

[00:09:40] Speaker 04:
the court need go that far.

[00:09:42] Speaker 05:
But what I would say... Like for example, a composition of matter that cures dementia, period.

[00:09:50] Speaker 05:
Would that claim be directed to an abstract idea?

[00:09:52] Speaker 04:
I think that claim could be potentially directed to an abstract idea because it claims the objective of the thing.

[00:09:58] Speaker 04:
It does not definitionally claim what the thing is.

[00:10:01] Speaker 05:
So then, therefore, what you're trying to do is make a distinction between so-called functional claims

[00:10:07] Speaker 05:
and properties, functions of a composition versus properties of a composition?

[00:10:13] Speaker 04:
I think that's a fair distinction, Your Honor, and that would be very consistent with past precedents, including American Axel and others, where there were claims to functional things, functional objectives, Apple VU claiming the enhancing as opposed to claiming the material and the properties thereof.

[00:10:31] Speaker 05:
But what if the property that's recited in the claim, and I'm not saying this is true for your magnetic saturation of coercivity limitations, but what if the limitation in the claim is so out of the ordinary?

[00:10:46] Speaker 05:
Like, you know, these diamond tables, they're of some level of hardness, I'm sure, and there's a

[00:10:53] Speaker 05:
measuring standard for the hardness of the diamond table and there's some unit and let's say normally diamond tables are a thousand hardness units but now you've claimed a diamond table that's 10,000 hardness units.

[00:11:09] Speaker 05:
A diamond table comprising all the conventional things that make up a diamond table, metal catalyst, etc., diamond to diamond bonding, wherein the hardness of the diamond table is 10,000 hardness units.

[00:11:23] Speaker 05:
Would that claim be patent eligible?

[00:11:26] Speaker 05:
Or would that be directed to just the idea of having a diamond table that has some super high hardness level?

[00:11:36] Speaker 04:
a close case, Your Honor, on the border of eligibility.

[00:11:42] Speaker 04:
Certainly, it would depend on what else was in the claim that was tethered to that performance crime.

[00:11:47] Speaker 04:
That's my claim, period.

[00:11:49] Speaker 04:
That's it.

[00:11:50] Speaker 04:
That's all that's in the claim.

[00:11:52] Speaker 04:
I think that would be, that's certainly not our case here.

[00:11:56] Speaker 04:
I'll note that, that we have a claim.

[00:12:00] Speaker 05:
Okay, so take for granted, that's a tough issue, maybe a tough issue for you.

[00:12:04] Speaker 05:
Why is your claim better than the claim I just came up with?

[00:12:09] Speaker 04:
The difference is that the hardness unit, as I understood you describing it, was more of a performance property.

[00:12:18] Speaker 04:
Whereas here, these are not performance properties, these are material properties.

[00:12:23] Speaker 04:
These are well understood and recognized properties of materials, as Dr. German testified.

[00:12:29] Speaker 04:
They're inherent and intrinsic to the materials.

[00:12:32] Speaker 04:
Put another way, there's no evidence in this record that anyone was seeking to create a

[00:12:40] Speaker 04:
PDC with the material properties, that that was some objective or goal or original intent of anyone.

[00:12:46] Speaker 04:
Whereas someone could say, oh, I want a PDC that's really hard or drills for work.

[00:12:49] Speaker 05:
I would have thought that part of your argument today would have been how the patent itself describes a relationship between these properties, like coercivity and magnetic saturation, and actual structural elements inside the diamond table.

[00:13:07] Speaker 05:
For example, mean free paths

[00:13:09] Speaker 05:
metal content.

[00:13:11] Speaker 05:
And so in that way, while just looking at the claim alone, it might look like you're just reciting properties or functions or however you want to call it or results.

[00:13:22] Speaker 05:
But in fact, these statements in the claim inform on structure.

[00:13:27] Speaker 04:
I would agree with that, Your Honor, of course.

[00:13:29] Speaker 04:
That is something we noted extensively in the briefing, that the properties are not merely just

[00:13:34] Speaker 04:
arbitrary properties of material, but they go right to the heart of improving the performance capabilities by making better diamond to diamond bonding.

[00:13:45] Speaker 04:
But they don't just claim a better diamond to diamond bonding, they claim how that's achieved through the properties.

[00:13:52] Speaker 04:
And so for those reasons, Your Honor, we believe that this is a case that would be eligible under step one.

[00:14:00] Speaker 04:
I can see I'm into my rebuttal time, so I'll

[00:14:02] Speaker 04:
And this is for the question.

[00:14:03] Speaker 03:
We'll give you two minutes for rebuttal.

[00:14:06] Speaker 03:
Excuse me.

[00:14:06] Speaker 03:
We'll give you two minutes for rebuttal.

[00:14:08] Speaker 03:
Thank you.

[00:14:09] Speaker 03:
Okay.

[00:14:09] Speaker 03:
Ms.

[00:14:09] Speaker 03:
Chen.

[00:14:10] Speaker 01:
Okay.

[00:14:10] Speaker 01:
Thank you, Your Honor.

[00:14:11] Speaker 01:
May you please support?

[00:14:13] Speaker 01:
The commission's decision here doesn't swallow all of Patton off, nor does Chuck Rivardi decide the facts of this case.

[00:14:21] Speaker 01:
Affirming the commission's decision does not require the support to articulate some new section 101A3.

[00:14:29] Speaker 01:
The commission faithfully applied

[00:14:31] Speaker 01:
longstanding Supreme Court and this court's precedent that consistently and repeatedly apply the abstract idea exception to prohibit patenting a mere performance goal or some end result?

[00:14:45] Speaker 05:
But we've never did it in the context of a composition of matter plan, right?

[00:14:49] Speaker 05:
This case is breaking new territory.

[00:14:52] Speaker 05:
If we were to affirm, then this very crude tool

[00:15:00] Speaker 05:
patentability, known as patent eligibility, will start running rampant through composition of matter claims, just as it has through computer software and diagnostic claims.

[00:15:10] Speaker 05:
Is that true?

[00:15:12] Speaker 01:
I disagree, Your Honor, because the application of fact to law in a Section 101 context has always been a case-by-case judgment.

[00:15:20] Speaker 01:
And here, the Section 101 inquiry is aided by factual findings made by the Commission of the Law.

[00:15:28] Speaker 01:
Those factual findings include

[00:15:31] Speaker 01:
what the inventor characterizes as their contribution to the prior art, what the prior art was at the time of the invention, what the specification discloses regarding the properties, right?

[00:15:43] Speaker 05:
It also... Well, reading the patterns in these 101 cases, I think we've always understood it to be a legal question.

[00:15:52] Speaker 05:
I mean, we have, in dozens of one-on-one cases now, read the patent to try to discern what is the meaning of whether this patent claim is directed to an abstract idea versus being an actual invention, possessing an invented concept.

[00:16:09] Speaker 05:
We've never said that that's a factual inquiry.

[00:16:13] Speaker 05:
We've always handled that, and we've handled it on Rule 12 motions.

[00:16:16] Speaker 01:
Certainly, Your Honor.

[00:16:18] Speaker 01:
Many of these cases on Section 101 have come up to this Court on appeal from a motion to dismiss or summary judging.

[00:16:24] Speaker 01:
But that's not how the disposition of this case came to be.

[00:16:27] Speaker 05:
I guess what I'm wondering is why can't we, the Court, read the patent, see that it plainly discusses relationships and correlations between certain properties like coercivity and magnetic saturation,

[00:16:43] Speaker 05:
to structural elements of the plain diamond table, including the mean free path between diamond grains and the metal content, the cobalt metal content of the catalyst.

[00:16:57] Speaker 05:
And so why isn't that enough to understand, okay, this patent is informing skill artisans that there is

[00:17:05] Speaker 05:
a relationship between these properties and their values and things that are part of the diamond reconstruction.

[00:17:16] Speaker 01:
Your Honor, I have two responses.

[00:17:18] Speaker 01:
First, that goes to the heart of the dispute between the parties in front of the ALJ and the commission.

[00:17:25] Speaker 01:
What do these properties mean?

[00:17:27] Speaker 01:
Are they just desired goals and results, or are they actually

[00:17:31] Speaker 01:
correlate in some way to a discreet and distinct PDC composition.

[00:17:35] Speaker 00:
How are they, in your view, that they're goals, right?

[00:17:39] Speaker 00:
That's right.

[00:17:42] Speaker 00:
Could you explain why they're goals?

[00:17:44] Speaker 00:
I mean, when you look at them, there's a particular property, for example, coercivity of about 115, and the specification says how you measure that.

[00:17:55] Speaker 00:
So why is it a goal?

[00:17:58] Speaker 01:
They related to a goal because the AOJ found that they're only loosely correlated to any physical characteristics.

[00:18:06] Speaker 01:
Now, when reading from the specification, it may seem... Can I ask you something?

[00:18:10] Speaker 00:
Why is it itself a physical characteristic?

[00:18:14] Speaker 01:
It is a physical characteristic in the sense that these measured properties are measuring how a PDC structure behaves in a magnetic field.

[00:18:24] Speaker 01:
The PDC structure has metal content.

[00:18:26] Speaker 01:
And so it's undisputed that, inherently, it's going to have a coercivity.

[00:18:32] Speaker 01:
It's going to have a magnetic saturation and a specific permeability.

[00:18:36] Speaker 01:
Dr. German, US synthetic's expert, admitted that these characteristics are found in conventional PDCs.

[00:18:44] Speaker 01:
It's not something new that US synthetic came up with.

[00:18:47] Speaker 00:
Correct.

[00:18:47] Speaker 00:
But I assume that there must be something about the range that is different than conventional.

[00:18:55] Speaker 00:
claimed a particular range, it's not just saying any material that has a coercivity, right?

[00:19:03] Speaker 00:
It's a particular range.

[00:19:04] Speaker 01:
But the range, the specification does not go into that as part of the claim advanced.

[00:19:09] Speaker 01:
The range, respondents expert Dr. Schaefer testified, that is just some imperfect proxy as to the amount of metal content that's in the composition.

[00:19:19] Speaker 05:
I guess my question is, why does it need to be a perfect proxy?

[00:19:22] Speaker 05:
If there is some acknowledged relationship between these properties and something about the actual structure, tangible concrete structure, why isn't that good enough just for one-on-one purposes?

[00:19:39] Speaker 05:
I mean, there's other parts of patentability that we can look more deeply and more technically, like Section 112, all of those different kinds of inquiries,

[00:19:49] Speaker 05:
But just for the opening threshold of Section 101, where we're trying to figure out whether this is just as a matter of law and effective claim for claiming an abstract idea, I don't know why we would need such exacting structure-property relationships as the Commission seems to want.

[00:20:09] Speaker 01:
Well, I think the Section 101 inquiry addresses problems that are not addressed by other provisions in the PACMAT.

[00:20:16] Speaker 01:
Those concerns go to preemption.

[00:20:18] Speaker 01:
And here there is a preemption problem, because as US synthetics own test results.

[00:20:23] Speaker 00:
Isn't there one of the, you say there's a preemption problem, but do I recall correctly that there is one party that infringed the claim, or maybe somebody designed around the claim?

[00:20:38] Speaker 00:
Is that correct?

[00:20:40] Speaker 01:
I'm not sure if I can go into the details of that, but what I will say at a high level is,

[00:20:46] Speaker 01:
essentially the design around is to perform the conventional process and make conventional PDCs and that cannot be addressing the preemption problem is that the way forward for future inventors is to simply

[00:21:01] Speaker 01:
perform what has been done in the past 50 years.

[00:21:04] Speaker 00:
So can I try to understand the preemption?

[00:21:07] Speaker 00:
Your perspective is that because the patent specification only discloses one method of making the composition of matter, that they shouldn't be able to claim the composition of matter.

[00:21:20] Speaker 00:
Is that your argument?

[00:21:22] Speaker 00:
No.

[00:21:22] Speaker 01:
I know, Your Honor.

[00:21:23] Speaker 01:
I think the synthetic brief mischaracterizes what the commission's position below.

[00:21:28] Speaker 01:
It recognized that they claimed advance in what the inventor's contribution to the art was this recognition that you can use a higher centering pressure to make the PVC.

[00:21:37] Speaker 01:
But what they are claiming is supposedly their new PVC without actually defining what the concrete composition is.

[00:21:44] Speaker 01:
Instead, what they're claiming are these abstract results.

[00:21:47] Speaker 05:
Well, the concern I have is, and this was pointed out by your dissenting commissioner, that this kind of thinking is going to directly attack many, many, many composition plans that recite temperature values, pH levels, melting point ranges.

[00:22:07] Speaker 05:
All sorts of properties are decided with certain values or ranges.

[00:22:12] Speaker 05:
And now, under this type of thinking, we would have to say, well, those are just abstract ideas.

[00:22:20] Speaker 05:
Why?

[00:22:20] Speaker 05:
Because we haven't actually claimed the specific structural elements and the content of those structural elements.

[00:22:26] Speaker 05:
We're now claiming it by properties where there's actually maybe 40 different ways of different structures that can hit that melting point or hit that pH level, and we can't have claims like that.

[00:22:40] Speaker 01:
No, the Commission's decision doesn't go that far.

[00:22:42] Speaker 01:
I see my time is up, if I could.

[00:22:44] Speaker 03:
No, keep going please.

[00:22:46] Speaker 01:
I recognize the judges' diving chin asks, try to figure out what the line is for an abstract idea.

[00:22:54] Speaker 01:
And I think your question goes towards that.

[00:22:56] Speaker 01:
Not every property is the same, right?

[00:22:59] Speaker 03:
How do we know which is which?

[00:23:01] Speaker 01:
And I think that's based on some of these factual findings that the Commission made.

[00:23:05] Speaker 01:
The property is this desired goal result.

[00:23:08] Speaker 01:
There could be an incident where you could have a composition of matter claiming the property.

[00:23:14] Speaker 01:
Certainly the Commission of Justice doesn't categorically exclude these type of claims.

[00:23:18] Speaker 01:
Where the claimed composition, for instance, the ALJ's final initial determination, gave an example where some magnetic coercivity result or some electrical conductivity actually went towards the design and had some beneficial characteristics.

[00:23:35] Speaker 01:
But here, what it is is an imperfect proxy to other beneficial characteristics, like the amount of diamond bonding in the metal content.

[00:23:42] Speaker 01:
But that's not recited in the claims.

[00:23:44] Speaker 01:
Now, U.S.

[00:23:45] Speaker 01:
Synthetic below asserted claims, other dependent claims of the 502 patent, and other patents in the patent foreign portfolio that included the sintering pressure and or these metal content below 7.5%.

[00:23:59] Speaker 01:
After discovery, they voluntarily withdrew these claims because the accused PDCs

[00:24:05] Speaker 01:
all met these claim results, and yet they have varying compositions.

[00:24:10] Speaker 05:
The commission found that the respondents failed to prove that these claims lacked enablement.

[00:24:17] Speaker 05:
The commission found they didn't make the scope of the enablement argument successful, and you stand by that.

[00:24:23] Speaker 05:
That is right, Your Honor.

[00:24:28] Speaker 03:
OK.

[00:24:28] Speaker 03:
Thanks.

[00:24:29] Speaker ?:
OK.

[00:24:30] Speaker 03:
Thank you, Ms.

[00:24:31] Speaker 03:
Chan.

[00:24:32] Speaker 03:
Mr. Angelus?

[00:24:35] Speaker 03:
Thank you, Your Honor.

[00:24:37] Speaker 02:
Go ahead.

[00:24:38] Speaker 02:
Good morning, Your Honor.

[00:24:38] Speaker 02:
May it please the Court, Theo Angelus, K&L Gates, for the interveners.

[00:24:42] Speaker 02:
Just quickly on the 101 issues, there's some suggestion by U.S.

[00:24:46] Speaker 02:
Synthetic that it's never proper to have an underlying finding of fact in connection with Alice, step one.

[00:24:52] Speaker 02:
And they cite the Atrix case, for example, but we think that Atrix actually supports the opposite proposition.

[00:24:56] Speaker 03:
What's the finding of fact here?

[00:24:58] Speaker 03:
I'm sorry?

[00:24:59] Speaker 02:
What?

[00:25:00] Speaker 02:
What is the finding fact here?

[00:25:10] Speaker 02:
are not structural and do not imply any particular microstructure.

[00:25:15] Speaker 02:
That is the finding of fact.

[00:25:16] Speaker 05:
After the commission waved, specifically waved testimony, waved exhibits, waved a scholarly article, that all of those- This is all going to the notion that it's an imprecise proxy, an imperfect proxy, that there isn't some perfect correlation.

[00:25:31] Speaker 05:
And that goes to my next question, which is a question I asked the ITC, is why do you need perfect correlation?

[00:25:40] Speaker 05:
In other words, the demand on the commissioning side here to avoid an abstract idea problem is for any kind of property or functional side of the claim to have a perfect one-to-one correspondence to a very particularized

[00:25:56] Speaker 05:
species of a structural composition, and right now I don't have any idea why that would be necessary for the purposes of just the one long threshold.

[00:26:08] Speaker 02:
What we have here is a finding of structural ambiguity.

[00:26:11] Speaker 02:
And what the Commission found, as a matter of fact, is that if you look at these journal articles, you look at these exhibits, you see not only is there not an imperfect proxy, there's no proxy at all.

[00:26:20] Speaker 02:
A loose and generalized relationship is no correlation at all.

[00:26:24] Speaker 02:
And what the Commission found, looking very hard at the evidence and the exhibits, is that there is not a relationship between the coercivity of these magnetic side effects and this one performance measure

[00:26:34] Speaker 02:
There's no relationship between that and any specific microstructure at all.

[00:26:40] Speaker 03:
I'm not seeing why that's a 101 issue.

[00:26:43] Speaker 03:
It seems to me that our 101 cases, to the extent that they deal with composition of matter, are dealing with two quite different situations.

[00:26:53] Speaker 03:
One, in which what's claimed is purely conventional.

[00:26:59] Speaker 03:
That seems not to be the case here.

[00:27:02] Speaker 03:
And the other one is where the claim is to something which really hasn't been invented yet, and there's no description of how to achieve the result.

[00:27:13] Speaker 03:
This doesn't seem to be either one of those two situations, and I'm struggling to understand why this fits in with our 101 jurisprudence under those circumstances.

[00:27:22] Speaker 02:
So the way it does, Your Honor, is that the claims, when you look to what the claims are directed to, the commission needed to engage in fact-finding to determine what the claims are directed to.

[00:27:32] Speaker 02:
And what it found is that there are certain structural conventional pieces of this claim.

[00:27:36] Speaker 02:
What the claim is actually directed to is these magnetic side effects and this performance measure.

[00:27:42] Speaker 03:
And it tells you how to get there.

[00:27:44] Speaker 03:
There's one method of getting there, right?

[00:27:46] Speaker 02:
Yeah.

[00:27:46] Speaker 02:
And I will transition into 112 issues in a moment, Your Honor, as an alternative ground.

[00:27:50] Speaker 02:
But it does not tell you how to get there.

[00:27:52] Speaker 02:
There's nothing in the claim that recites how to, how to yield that.

[00:27:55] Speaker 02:
What's recited, those side effects do not get you there as the commission found as a matter of fact, there's too much structural ambiguity.

[00:28:02] Speaker 02:
All you have, there are the prior art satisfies these claim elements as the commission found on pages 30 to 33 of the appendix.

[00:28:10] Speaker 02:
And so that is a one-on-one issue.

[00:28:11] Speaker 02:
It's also a 112 issue.

[00:28:13] Speaker 00:
Council, just for a minute.

[00:28:15] Speaker 00:
So one thing, didn't the commission find that these claims were not obvious?

[00:28:23] Speaker 00:
Isn't that true in view of the partner?

[00:28:25] Speaker 00:
They were found to be not obvious and not anticipated by the partner, right?

[00:28:32] Speaker 02:
They were found, the grounds that were allowed to be asserted

[00:28:36] Speaker 02:
there was not a finding of obvious.

[00:28:38] Speaker 00:
That's correct, Your Honor.

[00:28:39] Speaker 00:
That's correct, Your Honor.

[00:28:40] Speaker 00:
Of course, a court can never say a patent is valid, but they can say that the party hasn't proved that it's invalid.

[00:28:46] Speaker 00:
So that's what you're talking about.

[00:28:47] Speaker 00:
That's correct, Your Honor.

[00:28:48] Speaker 00:
Now, also, I've got several questions for you.

[00:28:50] Speaker 00:
So I also want to ask you about the cases you're relying on for saying that step one of Alice, which is asking what is a claim directed to, whether that has underlying factual issues.

[00:29:02] Speaker 00:
I think you cited Atrix.

[00:29:04] Speaker 00:
I did.

[00:29:04] Speaker 00:
But Atrix is a step two case.

[00:29:07] Speaker 00:
And there Atrix, the court said there could be underlying fact questions.

[00:29:12] Speaker 02:
So respectfully, Your Honor, here's what Atrix says at 882 F3rd and 1127.

[00:29:17] Speaker 02:
These allegations suggest that the claimed invention is directed to an improvement in the computer technology itself.

[00:29:25] Speaker 02:
And so what claims are directed to

[00:29:28] Speaker 02:
is a step one analysis.

[00:29:29] Speaker 00:
Where does the court say there can be underlying factual issues under Alice step one?

[00:29:36] Speaker 02:
So that is the implication of this court's ruling that the district court did not properly credit the factual allegations that go to what the claims were directed to, which is a step one analysis.

[00:29:48] Speaker 00:
OK.

[00:29:49] Speaker 00:
My recollection is that Adriex is a step two case on the factual issues.

[00:29:52] Speaker 00:
But in any event,

[00:29:56] Speaker 00:
I also was wondering when you were talking about the properties, I guess in the wearing clause, is that what you're talking about?

[00:30:03] Speaker 00:
That the wear and the coercivity, for example, in the wearing clause is not correlated, I guess you were saying.

[00:30:12] Speaker 00:
But what I was trying to understand is if it's something that is disclosed as being measurable, a measurable property of a material,

[00:30:20] Speaker 00:
using an ATSM standard, I believe, is what's disclosed in this specification.

[00:30:26] Speaker 00:
How is that not a property, a measurable property of a material, instead of being like a functional element of a claim?

[00:30:37] Speaker 02:
So argue, Your Honor, is that it's a result.

[00:30:39] Speaker 02:
So we call it functional or result.

[00:30:41] Speaker 02:
I think the courts have used both of those terms.

[00:30:43] Speaker 00:
But by that meaning, isn't the length of my pencil a result?

[00:30:49] Speaker 02:
No, Your Honor.

[00:30:50] Speaker 00:
Why not?

[00:30:51] Speaker 02:
It's because there's no structural ambiguity in the length of your pencil.

[00:30:56] Speaker 00:
So you think there's structural ambiguity in the coercivity measure that is measured using an ATSM standard?

[00:31:03] Speaker 02:
Well, there's a coercivity measure, but we don't know what that says about the underlying structure.

[00:31:08] Speaker 00:
Why do we need to know?

[00:31:09] Speaker 00:
It's defining the meets and bounds of the composition of matter.

[00:31:13] Speaker 00:
So why do you need to know more than these are the meets and bounds of what I claim is my invention?

[00:31:18] Speaker 00:
And this is a measurement that falls within the scope.

[00:31:24] Speaker 02:
Respectfully, it doesn't do that because what the Commission found is that it sweeps in, for example, the prior art, which is why there are also 112 issues here.

[00:31:31] Speaker 02:
It sweeps in things that don't have the properties that it is allegedly measuring, which is what the Commission found on pages 30 to 33.

[00:31:39] Speaker 05:
Well, one concern I have here is how the Commission's enablement findings interact with its 101 analysis and what your position is.

[00:31:50] Speaker 05:
Let's assume for the moment

[00:31:51] Speaker 05:
will be affirmed upon enablement.

[00:31:54] Speaker 05:
That is to say, there's substantial evidence to support the Commission's findings that you did not prove these claims fail for lack of enablement.

[00:32:04] Speaker 05:
And the whole theory behind that argument was skilled artisans would have no idea how to make this kind of claim invention.

[00:32:12] Speaker 05:
don't know how to do it, don't know how to do it, the claim doesn't recite how to do it and obviously the commission said that doesn't matter because you didn't prove that skill of Larsen's actually would have that problem.

[00:32:24] Speaker 05:
So now we move over to the section 101 thing and we see why is it so mysterious all of a sudden for 101 purposes what these coercivity and magnetic saturation values entail because

[00:32:41] Speaker 05:
We already know through its enablement analysis that there are plenty of ways for skilled artisans to reasonably experiment to arrive at the diamond table with these types of coercivity and magnetic saturation values.

[00:32:57] Speaker 02:
Your Honor, my response to that is that this court can affirm on the grounds of a lack of enablement for the full scope, which is something the commission did not reach.

[00:33:05] Speaker 02:
Right.

[00:33:05] Speaker 02:
I'm sorry.

[00:33:06] Speaker 05:
My question, the leading part of my question is, assume for the moment we affirm on enablement.

[00:33:11] Speaker 05:
So if you lose on enablement, so now you're stuck with the commission's analysis on enablement and how, in fact, they found the skilled harnesses would be able to make all different kinds of diamond tables that meet these particular problem values.

[00:33:27] Speaker 02:
So what the commission found is that it would be a skilled artist and could make the particular embodiments in table one.

[00:33:36] Speaker 02:
It's a very different issue.

[00:33:37] Speaker 05:
And they also found you didn't make your scope of enablement case either.

[00:33:41] Speaker 05:
respectfully honor, I don't think they reached the question of enablement for the full scope under Amgen, which hadn't been decided at the time, but under the case of the law, let's assume now for the moment, the purposes of moving through this process, that the law didn't change when Amgen came out.

[00:33:57] Speaker 02:
That's right, your honor, it didn't, because this goes back to the O'Reilly case, it goes back to all these cases, the Holland furniture case, you can't, and this is a situation where the claims sweep in

[00:34:08] Speaker 02:
The prior art that's undisputed the dragon to and the essay team do not are not made with the centering pressure.

[00:34:14] Speaker 02:
It is a one 12 yard minutes enablement for the full scope argument your honor because it goes exactly to this question.

[00:34:25] Speaker 02:
of whether there are GDCs that are within the scope of the claim.

[00:34:28] Speaker 05:
I'm sorry.

[00:34:29] Speaker 05:
We're running out of time.

[00:34:30] Speaker 05:
Can you just get back to my concern about the 112 analysis that the commission did, which let's assume that we adopt, and then how that interacts with why there was a 101 problem?

[00:34:42] Speaker 05:
Because now we know through the 112 analysis that there really isn't a how problem, how to make these claim diamond tables that meet these particular property values.

[00:34:54] Speaker 02:
Respectfully, Your Honor, I disagree with that point.

[00:34:56] Speaker 02:
OK, if you're going to resist the hypothetical, then we can cut it off.

[00:34:59] Speaker 02:
We can cut it off.

[00:35:00] Speaker 02:
I would say this.

[00:35:01] Speaker 02:
A claim can be both invalid under 112 and 101, which is what we have here.

[00:35:06] Speaker 02:
There are similar inquiries that happen under the 101 analysis about the how and the result.

[00:35:12] Speaker 02:
And O'Reilly, I think, was a 112 case, but has cited repeatedly by this court in the context of 101.

[00:35:18] Speaker 02:
And that's why there's overlap there, Your Honor.

[00:35:21] Speaker 02:
I hope that answers your question.

[00:35:22] Speaker 02:
I'm happy to try.

[00:35:22] Speaker 02:
Take another swing at it.

[00:35:24] Speaker 02:
I didn't mean to dodge your hypothetical, Your Honor.

[00:35:25] Speaker 02:
I apologize.

[00:35:27] Speaker 03:
Okay.

[00:35:28] Speaker 03:
Thank you.

[00:35:29] Speaker 03:
Mr. Cooley, we've got two minutes here.

[00:35:44] Speaker 04:
Thank you, Your Honor.

[00:35:46] Speaker 04:
I have but a few brief points.

[00:35:49] Speaker 04:
First, on the issue of preemption, my friend stated that there was a conventional PDC.

[00:35:57] Speaker 04:
That was the designer on that.

[00:35:58] Speaker 04:
Evidence is not of record in this case.

[00:36:01] Speaker 04:
But what is relevant is that in rapid litigation management, the cells direct, this court found that evidence of a designer on a significant evidence of a lack of preemption

[00:36:13] Speaker 04:
Also, there was discussion about factual findings below, and what were those factual findings, and the nature of those, and we would maintain... I mean, the frustration here is that the claim seems to go beyond what you invented.

[00:36:27] Speaker 03:
That's really the heart of this dispute, and whether it's a 101 problem, or an Abelman problem, or an obviousness problem, but it does seem to be something here where you're claiming more than you invented.

[00:36:42] Speaker 04:
Well, respectfully, Your Honor, we would say that what is claimed here is very much what McRoe recognizes is allowable as a matter of 101, and that is it's a genus.

[00:36:54] Speaker 04:
It covers a range of potential solutions.

[00:36:57] Speaker 04:
It ranges, in fact, in Table 1, if we refer to Table 1, which is an APTX 103 and 104.

[00:37:04] Speaker 04:
These are the precise measurements from the inventive PDC, and you can see

[00:37:10] Speaker 04:
that there's, for example, a disclosure of a diamond grain size of 20.

[00:37:14] Speaker 04:
But there's also another embodiment where it's 11.

[00:37:17] Speaker 04:
And you can see how the impact flows through the other properties.

[00:37:20] Speaker 04:
So we're not merely designing one PDC cutter for one purpose.

[00:37:24] Speaker 04:
In the ARC, we have PDC cutters which are tuned for different purposes.

[00:37:29] Speaker 04:
And in fact, in this case, there were four different domestic industry products which had slightly varying properties, all of which fell within the claim limitations.

[00:37:38] Speaker 04:
and all of which fell within the scope of the invention.

[00:37:42] Speaker 05:
I'm just curious, if hypothetically we reverse the 101 and we reject the Interveneurs Alternative Designs for our funds on enablement, what happens to this case?

[00:37:53] Speaker 04:
Does it need to be remanded for further proceedings?

[00:37:56] Speaker 04:
No, Your Honor, we believe that there would be no further proceedings because

[00:38:01] Speaker 04:
complainant or petitioner prevailed on all other issues and the issue of domestic industry was decided in our favor and the Commission declined to further opine on that so we believe the only issue that remains here is this issue, Section 101.

[00:38:16] Speaker 04:
And there's no validity proceedings before the PTO?

[00:38:19] Speaker 04:
There are no validity proceedings.

[00:38:21] Speaker 04:
The claim was found novel, not obvious, enabled, no lack of written description.

[00:38:28] Speaker 04:
and only issue for the claims on appeal is section 101.

[00:38:32] Speaker 03:
If you have no further questions.

[00:38:36] Speaker 03:
Thank you.

[00:38:37] Speaker 03:
Thank you.

[00:38:37] Speaker 03:
Thank you, Your Honor.

[00:38:38] Speaker 03:
The case is submitted.

[00:38:39] Speaker 03:
Thank both counsels.

[00:38:40] Speaker 03:
All three counsels.