Enforcing patents against foreign infringers of patented processes

April 13, 2023 - In chemistry, life sciences, and other arts, valuable compounds and materials may be known — and thus unpatentable — but inventive processes for making the compounds can create or refine production capability on a commercial scale. In today's global manufacturing marketplace potential infringers can be anywhere, but enforcing process patent rights in foreign jurisdictions can present difficulties.

The patent statute thus expands the scope of infringing acts related to patented processes, even when performed abroad, through 35 U.S.C. § 271(g) ("271(g)"). This little-used statute allows patentees to target foreign producers, downstream importers and sellers, and others that benefit from products made from patented processes. Thus, with properly drafted patent claims, patentees have potential recourse when a process is infringed abroad and the resulting product is sold in the United States.

Expansion of infringing acts

The statute, 271(g), makes it an infringing act to import, use, sell or offer to sell "a product made by a patented process." The statute is meant to close the infringement loophole of a foreign entity using a patented process but directing subsequent economic activity into the U.S., e.g., importing or selling the product made by the process.

The statute grants a cause of action against "whoever" acts in the U.S. (e.g. imports or sells the product made by the process) — even if that entity did not perform the patented process abroad, although a patentee must first exhaust its remedies against the upstream entities before retail sellers. Therefore, separation of corporate entities or a manufacturer's limited residence aboard does not necessarily force the patentee to bring a foreign case and can still allow remedies such as an injunction against importation.

Foreign entities also cannot avoid infringement by splitting up the claimed steps. While process infringement in the United States under § 271(a) requires a single actor that performs all process steps, infringement liability under 271(g) is not so limited. This is because, as explained in the 2019 U.S. Court of Appeals for the Federal Circuit case of Syngenta Crop Protection LLC v. Willowood LLC, liability under the statute is not from "practicing the patented process abroad" but rather acts related "to products resulting from the patented process."

For example, in Syngenta, the patent was directed to a two-step chemical process, forming an intermediate and then converting it to the final product. The importer defendant presented evidence that the foreign manufacturer of the end product did not perform the first step of the chemical synthesis, obtaining the intermediate from another entity.

The Federal Circuit held this did not preclude infringement when evidence showed imported product was made via claimed two-step process in some manner — whether that process is practiced by a single entity was "immaterial" to the infringement analysis under 271(g). See Syngenta Crop Protection LLC v. Willowood LLC, 944 F.3d 1344 (Fed. Cir. 2019).

Limitations to infringement

There are some limitations to infringement under 271(g) — most importantly, the product must not be "materially changed" between the patented process and the domestic act. As explained in the 2009 Federal Circuit case of Amgen Inc. v. F. Hoffman-La Roche Ltd., this is "context-dependent" and key features can be gleaned from relevant properties/structures described in specification and claims. In the chemical context, for example, Amgen explained that "a significant change in the compound's structure and properties" is material.

In Amgen, a manufacturer performed a process forming erythropoietin (EPO) and then added polyethylene glycol to make their imported pharmaceutical product. The manufacturer argued the addition changed the structure of the EPO by replacing a hydrogen atom, and this changed properties of the composition, such as improving the half-life in the body.

But because the compound's overall structure was still similar, and the product performed the same function as in the "crude" EPO made from the claimed process, the Federal Circuit held the differences were not material and that the manufacturer infringed under 271(g).

As a contrary example, in the 1996 Federal Circuit case of Eli Lilly & Co. v. Am. Cyanamid Co., the defendant used a patented process to make an intermediate compound that could be converted into an antibiotic, but the intermediate itself was not an effective antibiotic. Because four chemical reactions were used to convert the intermediate to the antibiotic — each changing the structure of the compound — the Federal Circuit held the "significantly different" structure and different properties precluded infringement.

The other key carveout, that the product formed by the patented process cannot become a "trivial and nonessential component" of the product being imported or sold in the United States, appears more limited. Becoming part of larger device, like a shock absorber in a car, does not make a part "trivial" or "nonessential," as stated in the Northern District of California 1994 case of Hughes Aircraft Co. v. National Semiconductor Corp. Thus, if the product of the patented process maintains its features and benefits in the final product, this exception arguably does not apply.

Litigation strategies

In litigation, obtaining discovery for foreign processes may present a challenge, but patentees can wield § 295 to shift the burden of showing non-infringement after demonstrating "substantial likelihood" the process was infringed.

For example, an expert report that products show signs of the patented process, or that the process is the only mass-scale production method in the industry, can be enough to shift the burden to the accused infringer to bring forth evidence of a distinct process. And, because damages under 271(g) can be limited in certain instances through § 287(b), providing notice of infringement and establishing knowledge can enhance damages awards.

Claim drafting strategies

While any process claim providing a tangible product can create a cause of action under 271(g), properly drafted patent claims will maximize the strength and flexibility of potential enforcement options. Thus, patentees should consider the ideal "final" commercial product — what is imported, used, and sold in the industry? To avoid limitations to liability from material changes or trivial incorporation, claiming an inventive process of making a product and making a "final" product of typical, subsequent industry steps can expand potential scope and increase the likelihood of success.

For example, in Eli Lilly the intermediate was sufficiently different in structure and function from final imported product to preclude 271(g), but the final antibiotic product was known and process steps for forming that product could have easily been added in dependent claims. And in the 1996 Federal Circuit case of Bio-Technology Gen. Corp. v. Genentech, Inc., claims adding final ancillary steps–isolation and purification of the chemical–gave clear coverage of the final marketplace product.

Patentees should consider process claims resulting in a range of final products, including the direct product of the inventive process (e.g., a compound), forms obtained by typical post-production processing like purification or conversion to related material (e.g., changing a substituent group), generalized compositions including the product (e.g., a medication including the compound), and specific forms that are currently or anticipated to be sold in the marketplace (e.g., an injectable aqueous solution including the compound).

Since there is already novel and non-obvious subject matter, these steps are simple additions during prosecution that will not delay allowance. At the same time, they can expand the scope of potential infringement under 271(g) and increase the odds of a successful enforcement by limiting defenses, giving patentees potential recourse against infringing foreign entities.