No. H24 (Ju)-1204 Patent Infringement Case Seeking Injunction (Petition for Review granted in 2012)

Decision issued on June 5, 2015 by the Second Petty Bench

1. Conclusion

  The original decision by the Intellectual Property High Court is repealed. The case is remanded to that court.

2. Background

  The present case is one in which the petitioner, owner of Japanese Patent No. 3737801 (referred to hereinafter as the "patent at issue"), sought injunction, against the respondent, of manufacture and sales of certain product of the respondent as well as destruction of the product in inventory, based on Article 100 of the Patent Act. The petitioner lost in both the first instance and the second instance (the Intellectual Property High Court).

  The claims of the patent at issue are defined in the terms of product by process claims ("PBP claims") in which a product is specified in terms of its manufacturing method. The product of the respondent is manufactured by a method different from that recited in the PBP claims of the patent at issue.

3. Decision by the lower court (Full-bench decision by Intellectual Property High Court)

  When determining the technical scope of a patented invention, the wording or the language of the claims should be the basis of this determination. This is because, if this principle is to be rejected and the specific wording used in the patent claims is deemed not to limit the technical scope of the invention, then the trust of any third party who takes actions based on the wording of the claims would be violated, causing damages to the legal stability. Therefore, in the case of PBP claims, the fundamental principle is to interpret their scopes as being limited to the manufacturing methods recited in these claims.

  A PBP claim can be either a genuine PBP claim or a non-genuine PBP claim. A genuine PBP claim is a PBP claim that recites a manufacturing method because there is a circumstance that makes it impossible or difficult at the time of filing to directly define or specify the product in terms of its structure or property (referred to hereinafter as "circumstance for impossibility or difficulty"), whereas a non-genuine PBP claim is one for which there is no such circumstance for impossibility or difficulty. The technical scope of an invention defined by a genuine PBP claim is interpreted to be not limited to the manufacturing method as recited in such claim, and to encompass a product in general whereas a non-genuine PBP claim is interpreted to be limited to the manufacturing method as recited, in accordance with the fundamental principle. With respect to a genuine PBP claim, it is permitted to specify a product in terms of its manufacturing method in light of the spirit of Article 1 of the Patent Act (Purpose of Patent Act), etc., and it is interpreted to be in compliance with Article 36(6)(ii) of the Patent Act (Clarity of Claims).

  Since a genuine PBP claim is not in accordance with the fundamental principle described above, the burden of proof to show that a PBP claim is a genuine PBP claim is on the party that makes such assertion. And if the party fails, the PBP claim is determined to be a non-genuine PBP claim.

  This interpretation of a genuine/non-genuine PBP claim is used not only during a determination of the technical scope in an infringement lawsuit but also during a determination of the substance of the invention in an invalidity defense under Article 104-3 of the Patent Act in the lawsuit.

  Since the claims of the patent at issue were non-genuine PBP claims, the product of the respondent (appellee at that time) does not fall within the technical scope of the invention of the patent at issue.

  The chart below summarizes the decisions made on the PBP claims by the Intellectual Property High Court

4. Decision by the Supreme Court

  The basis for the genuine/non-genuine PBP claims adapted by the lower court cannot be accepted. A patent is granted on an invention for a product, an invention for a method, or an invention for a method for manufacturing a product; thus, when a patent is granted on an invention for a product, the scope of the patent right would encompass any product that has the same structure, or property, etc. as the patented product, regardless of the method by which the product is manufactured. Therefore, even in the case of a PBP claim, it would be proper to interpret that the technical scope of the patented invention should be determined to encompass a product whose structure or property, etc., is identical to that of a product manufactured by the recited manufacturing method. (That is, the scope is not limited by the manufacturing method.)

  On the other hand, from the stand point of Article 36(6)(ii) of the Patent Act, if for all PBP claims, their patent scopes are not limited by the manufacturing method, interest of a third party may be unfairly harmed since it is not clear as to what structure or property is specified by the manufacturing method. This presents a problem. Therefore, it would be proper to interpret that a PBP claim complies with Article 36(6)(ii) of the Patent Act only when there is a circumstance that makes it impossible or too impractical at the time of filing to directly define or specify the product in terms of its structure or property (referred to hereinafter as "circumstance for impossibility or impracticality"). Therefore, the decision by the lower court is not in compliance with the Patent Act, which incompliance clearly affects the decision.

  Accordingly, the decision by the lower court is repealed and the case is remanded to the lower court in order to have the technical scope of the invention of the patent at issue determined and further to have a thorough inquiry into, among other things, whether there is a circumstance described above for the claim of the patent at issue and the claim therefore satisfies the requirements of Article 36(6)(ii) of the Patent Act.

< Supplemental Opinion by the Chief Judge Katsumi Chiba >

  Since a claim for a product should specify or define the product in terms of its structure or property and a PBP claim is an exception to this, examination of the application should be performed with rigor. More specifically, for a PBP claim, the applicant should be required to present its case for a circumstance for impossibility or impracticality. And when the applicant is unable to do this to the satisfaction of the Examiner, the application should be finally rejected. And in order to avoid this situation, an application should be filed, as an invention for a method for manufacturing the product.

  It cannot be helped if a registered patent with PBP claims is held to be invalid in the future because the patent owner, faced with an invalidity defense in an invalidation procedure or in an infringement lawsuit, is unable to show the presence of a circumstance for impossibility or impracticality.

  The chart below summarizes the decisions made on the PBP claims by the Supreme Court.

5. Our Remarks

  In the full-bench decision by the Intellectual Property High Court, PBP claims were categorized into genuine PBP claims and non-genuine PBP claims having different scopes of protection. However, it was not clear as to whether a PBP claim of a registered patent is a genuine one or non-genuine one until and unless a court makes that decision, which made it difficult for a third party to ascertain the scope of protection.  The Supreme Court, in its recent decision, does not allow the PBP claims to be categorized into two different kinds and held that if a circumstance for impossibility or impracticality can be shown to have existed at the time of filing, then Article 36(6)(ii) of the Patent Act, on clarity of claims, is satisfied and the technical scope of the invention is not limited by the recited manufacturing method whereas if a circumstance for impossibility or impracticality cannot be shown to have existed at the time of filing, then the claim is rejected for violation of Article 36(6)(ii) of the Patent Act. It can be said that this decision clarifies the way to interpret the scope of a PBP claim to a significant degree, thus improving the predictability of the scope of protection by a third party. However, the vagueness of the standard for determining a "circumstance for impossibility or impracticality" in this decision leaves it unclear as to what kind of circumstance constitutes a "circumstance for impossibility or impracticality". We would have to wait for future precedents for this to be established.

  Also, the full-bench decision by the Intellectual Property High Court only addressed how a PBP claim should be interpreted after the patent issues and in the setting of a patent infringement lawsuit. And it did not address how a PBP claim should be interpreted during the examination before the application is granted. As can be seen from the fact that the Supreme Court decision addresses rejection of a PBP claim for violation of Article 36(6)(ii) of the Patent Act, the decision addresses how a PBP claim should be interpreted before granted, i.e., during its examination. In light of this Supreme Court decision, the Japan Patent Office announced, on June 10, 2015, that the Office will start studying any "Revisions in the Examination Standards" and handling of PBP claims in "Examination and Appellate Procedures" (see https://www.jpo.go.jp/system/laws/rule/guideline/patent/tukujitu_kijun/product_process/C150706.html). Accordingly, care should be exercised in drafting PBP claims for application from this point on.

  The future decision by the Intellectual Property High Court to which the case was remanded will be watched with interest.

  Please do not hesitate to contact us with any questions or comments, or if you would like us to clarify any of the points discussed above.