Zhejiang Medicine Co., Ltd. et al. v. Kaneka Corporation


Docket No. 2016-1390

LOURIE, MOORE, O’MALLEY
January 12, 2017

Non-precedential

Brief Summary: DC grant of SJ vacated for faulty claim construction and remanded.

Summary: Kaneka appealed DC grant of SJ to Zhejiang for noninfringement of the asserted claims of US 7910340 relating to an industrial process for producing oxidized coenzyme Q10 (“CoQ10”) used in health supplements. The DC originally construed the claim term “oxidizing” to have its plain and ordinary meeting, rejecting Kaneka’s argument that the ‘oxidizing’ term requires ‘increasing the rate’ of oxidizing reduced CoQ10.” It later held a status conference to address the impact of a separate FC panel construction of “oxidizing” in the ‘340 patent as “some action resulting in oxidation” (Kingdomway, FC 2015). ZMC then moved for and was granted SJ because “Kaneka failed to show ‘what oxidation, if any, of coenzyme Q10 during ZMC’s process is attributable to active oxidation above the level of passive oxidation that naturally occurs throughout ZMC’s process”. The DC had also granted ZMC’s motion to exclude Kaneka’s expert report, “agreeing it was ‘irrelevant’” as it was “based on a ‘now incorrect’ construction.” The FC panel explained that it applies the law of the regional circuit (here, the Fifth Circuit), reviews evidentiary rulings for an abuse of discretion, and SJ decision de novo (LaserDynamics, FC 2012). It also explained that the DC’s interpretation of its Kindgomway construction was “not precise” as that FC panel did “not state that to be an active step, the oxidation rate must be greater than that of passive oxidation” and “is silent as to any degree of oxidation that would be necessary to qualify as active oxidation”, “that there be some action that results in oxidation”, “that oxidation…does not require the use of an oxidizing agent”, and “did not require ‘increased oxidation’ ‘in excess of that which occurs naturally from exposure to ambient air.’” The FC panel also explained that it “need not decide whether it would have an an abuse of discretion to exclude” Kaneka’s expert reports since the DC required it “to address more than was necessary under Kingdomway.” It agreed with Kaneka “that ample evidence precluded the” DC’s grant of SJ, finding the DC’s “misinterpretation of the Kingdomway construction marred its analysis.” “The Kindgomway court simply required that the oxidation occurred via an ‘active step’” and “[e]vidence showing that the oxidation achieved from ZMC’s active steps is greater than passive oxidation is one way in which Kaneka could support its infringement theory-and possibly the most persuasive way-but this level of evidence is not necessary to show infringement” (“The question is whether [ZMC’s steps] are active steps resulting in oxidation”, not “whether these steps would have caused more of less oxidation than passive….”) It explained that at the SJ step, “the court must focus its inquiry on what a reasonable jury could find, not what evidence may be most compelling” (the DC may have “heighten[ed] Kaneka’s burden”). It therefore concluded there is a dispute of material fact and that the DC erred in granting SJ.

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