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Patent Lesson: If You Have a Best Mode - Disclose It, Contributed by Robert H. Resis, Banner & Witcoff, Ltd.

Friday, August 26, 2011

By Robert H. Resis, Banner & Witcoff, Ltd.
There are two primary ways to protect proprietary technology — patents and trade secrets. Trying to patent a technological advancement while keeping another technological advancement as a trade secret can lead to the loss of both patent and trade secret protection. This was the outcome in a recent lawsuit between Wellman, Inc. and Eastman Chemical Company.1

Investment and Technological Success
Wellman had two patents that were involved in the lawsuit. The Wellman patents2 disclose polyethylene terephthalate ("PET") resins for use in plastic beverage containers.3 The patents state that older ("prior art") PET resins produced bottles that shrank or grew hazy.4 This was said to result from crystallization when bottles where "hot-filled" with product at temperatures of between about 180 and 205 degrees Celsius.5

To overcome these problems, Wellman spent millions of dollars and thousands of hours developing "slow-crystallizing" PET resins.6 An inventor, Dr. Steven Nichols, declared that the inventors "unlocked in . . . research . . . the secret to making an effective slow-crystallizing bottle resin by understanding the proper balance of the parameters of catalyst concentration, co-monomer concentration, intrinsic viscosity, and heat-up-rate [HUR] additive in order to make high clarity bottles."7

The Wellman patents were directed to these "slow crystallizing" PET resins.8 The Wellman patents defined "slow-crystallizing" PET resins as those possessing a significantly higher heating crystallization exotherm peak temperature as compared to conventional PET resins.9 The new resins purportedly retained exceptional clarity by delaying the onset of crystallization relative to conventional PET resins.10 Conventional resins used the metallic element antimony as a catalyst.11

Commercial Embodiment Was Not Disclosed in the Patent Applications
By the time Wellman filed a patent application in May 2004, which led to the '317 patent, Wellman had commercialized a slow-crystallizing, hot-filled PET resin called Ti818.12 Wellman did not, however, disclose the recipe for Ti818 in its patents, nor did Wellman disclose any other specific PET resin recipes.13 Instead, Wellman provided ranges of concentrations for categorized lists of possible ingredients.14 The following table provides a comparison of pertinent parameters between Wellman's Ti818 resin and the disclosure in the Wellman patents.

Table – Comparison of Pertinent Parameters Between Wellman's Ti818 Resin and the Disclosure in the Wellman Patents15

ParameterAmount in Wellman's Commercial Product (Ti818)Disclosure in the Wellman patents
Isophthalic Acid1.4 mol %1.6-2.4 mol %
Diethylene Glycol1.9 mol %1.6 mol %
Heat-up rate ("HUR") additive7.5 ppm of carbon-black HUR additive N990, having a 290 nm particle sizeOptional HUR additives improve resin reheating profile during blow molding; "natural spinels and synthetic spinels" are the "most preferred" HUR additives. Copper and chromite black spinel and chrome iron nickel black spinel are characterized as "[p]articularly outstanding spinel pigments."Carbon-based HUR additives are described as "one embodiment" of the invention. "Suitable" carbon-based additives include carbon black. U.S Patent No. 4,408,004 ("Pengilly") discloses a preferred average particle size for carbon black in a range of between about 15 to about 30 nm.

The Patent Infringement Lawsuit

Wellman sued Eastman for patent infringement. After trial, the case went to appeal before the U.S. Court of Appeals for the Federal Circuit, which hears all patent appeals.

The Federal Circuit affirmed judgment against Wellman, concluding that the patents' descriptions (their "specifications") did not disclose the "best mode" of carrying out the invention.16 Further, since the "best mode" was publicly disclosed during the course of the litigation, any trade secret Wellman sought to conceal was no longer a secret.

Patent Law Requires Each Inventor to Disclose Their Best Mode
As highlighted by the following discussion of the case report, when obtaining a patent, it is important to determine at the time of filing the patent application with the Patent Office whether any inventor has a "best mode" of practicing the claimed invention. If any inventor has a best mode, that best mode needs to be disclosed in the patent application. The patent laws state that a patent specification "shall set forth the best mode contemplated by the inventor of carrying out his invention."17 Failure to disclose the best mode can result in a judgment that the asserted patent claims are invalid, as in the Wellman case.

The Federal Circuit used a two prong analysis of the best mode issue.18 The court addressed first whether, at the time of patent filing, at least one inventor had a best mode of practicing the claimed invention,19 and second, whether there was a concealment of the best mode from the public.20

The Federal Circuit stated that the first prong of the best mode inquiry is "subjective, focusing on the inventor's personal preferences as of the application's filing date."21

At Least One Inventor Had a Best Mode at the Time of Patent Filing
The Federal Circuit found that there was no genuine dispute that at image1.gifleast oneimage1.gif inventor (Dr. Nichols) "subjectively believed that Ti818—which contained carbon black N990 as a heat-up rate ("HUR") additive—was the best resin available for hot-fill packaging at the time of filing the applications for the Wellman patents."22 Specifically, Nichols testified that at the time of filing, his preferred PET recipe was "the first run of the product that we called Ti818 which was done at our Pearl River plant in the fall of 2003."23 Nichols also admitted that, before filing, he believed there was no PET recipe better than the Ti818 recipe of 2003.24 Another inventor (Dr. Moore) also apparently believed that Ti818 was the preferred PET resin.25 Although Moore "did not refer to Ti818 by name, he testified that as of the filing date of the '317 patent, the best way of making PET in the research laboratory to achieve the claimed TCH, absorbance, and luminosity values used a combination of titanium catalysts, cobalt, and carbon black as the HUR additive" (TCH being the temperature at which the sample crystallizes the fastest during heating in a differential scanning calorimetry machine).26 Ti818 contained each of these ingredients.27

The Federal Circuit found that Wellman's declarations indicated that in 2004, prior to filing for the patents, the concentration of carbon black was reduced (but not eliminated), and a branching agent included, purportedly to accommodate specific customer requirements.28 The court held, however, that having subtle changes in a recipe "to accommodate specific customer demands does not excuse the applicant's obligation to disclose what [the inventors] contemplated was the best mode of practicing the invention at the time of filing."29

The Federal Circuit also found that "[t]here was no genuine dispute that at image1.gifleast oneimage1.gif inventor subjectively believed that the specific HUR additive used in Ti818, carbon black with a 290 nm particle size, was essential."30 After testing a variety of HUR additives in October 2002, an inventor (Thompson) wrote that "carbon black with a 290 nm particle size had clearly the best reheat rate." (emphasis added).31 Thompson characterized carbon black with a 290 nm particle size as an "invention," and characterized the other tested HURs as "prior art."32 Further, a table comparing tests on various HUR additives stated that "7.5 ppm code 5056" is the "HUR Needed for hotfill," while the spinel Cr2O3 is described as "Green." (emphasis added).33 Wellman's internal name for carbon black with a 290 nm particle size was "code 5056," indicating a clear preference for this HUR.34 The Federal Circuit further noted that inventor Moore "forwarded this table to Wellman's patent counsel less than two months before Wellman filed the application leading to the

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