Morphosys AG v. Cambridge Antibody Ltd

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: MorphoSys AG (Germany)
  • Defendant: Cambridge Antibody Technology Limited (United Kingdom)
  • Plaintiff’s Counsel: Heller Ehrman White & McAuliffe
• Case Identification: 1:00-cv-00146, D.D.C., 03/08/2002
• Venue Allegations: Venue is predicated on 35 U.S.C. § 293, which provides for jurisdiction over foreign patent owners in the U.S. District Court for the District of Columbia.
• Core Dispute: Plaintiff seeks a declaratory judgment that it does not infringe Defendant's U.S. Patent No. 5,969,108, and that the patent is invalid and unenforceable due to alleged inequitable conduct during prosecution.
• Technical Context: The technology involves using phage display libraries to discover and produce human antibodies for use in diagnostic and therapeutic products.
• Key Procedural History: The complaint alleges a history of conflict, including prior litigation in Germany over a related European patent and communications that Plaintiff interpreted as threats of infringement litigation in the U.S. The central allegation is that Defendant, during prosecution of its patent, failed to disclose material prior art—a research grant to Dr. George Smith (the "Smith Grant")—to the U.S. Patent and Trademark Office, which allegedly constitutes inequitable conduct rendering the patent unenforceable.

Case Timeline

Date	Event
1985-06-01	Dr. Smith publishes an article in Science on phage display.
1988-11-01	Dr. Smith submits the "Smith Grant" application to the NIH.
1989-07-01	The Smith Grant is funded and becomes effective.
1989-08-01	The complaint alleges the Smith Grant was publicly accessible by this date.
1990-07-10	Earliest claimed priority date for the ’108 Patent (United Kingdom).
1993-01-08	Application for the ’108 Patent filed in the USPTO.
1996-05-01	Complaint alleges Defendant became aware of the Smith Grant by this month.
1998-09-01	Defendant institutes German litigation against Plaintiff on a related European patent.
1999-10-19	U.S. Patent No. 5,969,108 issues.
2002-03-08	Plaintiff files First Amended Complaint.

II. Technology and Patent(s)-in-Suit Analysis

• Patent Identification: U.S. Patent No. 5,969,108, "Methods for Producing Members of Specific Binding Pairs," issued October 19, 1999.

The Invention Explained

• Problem Addressed: The patent describes the significant challenge of producing human antibodies for therapeutic use. Traditional methods, such as immunizing animals, yield non-human antibodies that can cause adverse immune reactions in patients, and creating human monoclonal antibodies was technologically very difficult ('108 Patent, col. 2:1-24).
• The Patented Solution: The invention provides methods to create and screen vast libraries of antibody fragments using "phage display" technology. A "replicable genetic display package," such as a bacteriophage, is engineered to have the gene for an antibody fragment ("specific binding pair member") fused to one of its coat protein genes. This results in the phage physically displaying the antibody fragment on its surface while carrying the corresponding genetic code inside ('108 Patent, Abstract; col. 3:55-65). This physical linkage allows researchers to rapidly pan a diverse library against a target of interest (e.g., a disease-related protein) and isolate only the phages that bind, thereby identifying the most effective antibody fragments.
• Technical Importance: This approach enables the creation of large repertoires of human antibody fragments and their selection for desired binding properties without the need for immunization, a key step in developing modern human antibody therapeutics (Compl. ¶6).

Key Claims at a Glance

• The complaint seeks a declaration of non-infringement and invalidity as to all claims, but specifically identifies claims 1, 3, 7-12, 14-17, 19, 21-22, and 29 as anticipated by withheld prior art (Compl. ¶54, ¶60, ¶63). Independent claim 1 is representative.
• Essential elements of independent claim 1 include:
  • A method of producing a member of a specific binding pair, where the member is a single polypeptide chain comprising a binding domain of an antibody, which in turn comprises a light chain variable region and a heavy chain variable region.
  • Providing a repertoire of nucleic acid encoding host cells polypeptides.
  • Expressing the polypeptides in recombinant host cells to produce a repertoire of the cells, each comprising a component of a secreted filamentous phage, such that the specific binding pair member is displayed on the phage surface.
  • Selecting a phage from the repertoire by binding it to its complementary specific binding pair member.
  • Producing the specific binding pair member in a form free from the phage.
• The complaint does not explicitly reserve the right to assert dependent claims, as it is a declaratory judgment action.

III. The Accused Instrumentality

Product Identification

Plaintiff’s Human Combinatorial Antibody Library, or "HuCAL" (Compl. ¶7).

Functionality and Market Context

The complaint describes HuCAL as a technology that Plaintiff licenses to pharmaceutical companies in the United States and elsewhere for the purpose of producing human antibodies (Compl. ¶9(f), ¶12). It is positioned as a direct competitor to the Defendant's own human antibody library (Compl. ¶15). The complaint notes that Defendant has previously claimed in a German lawsuit that the HuCAL library infringes the European counterpart of the ’108 Patent, suggesting a functional similarity between the technologies at a high level (Compl. ¶9(b), ¶9(e)). However, the complaint does not provide a detailed technical description of the HuCAL process.

IV. Analysis of Infringement Allegations

The complaint is a declaratory judgment action for non-infringement and therefore does not contain affirmative infringement allegations or a claim chart. Instead, it asserts that MorphoSys "has not, and is not now, infringing any claim of the '108 patent" (Compl. ¶60). The basis for the lawsuit is the existence of an "actual controversy" between the parties, which the complaint alleges has been created by Defendant's actions (Compl. ¶4). These actions include:

• Litigating against MorphoSys in Germany over a related European patent (Compl. ¶9(b)).
• Alleged statements during settlement talks that "other patents [were] coming along" which Defendant intended to assert (Compl. ¶8(d)).
• Sending promotional materials to one of Plaintiff’s licensees stating that Defendant's related '793 patent "will affect all parties that are using phage display methods to isolate human antibodies" (Compl. ¶8(h)).

No probative visual evidence provided in complaint.

Identified Points of Contention

Should the case proceed to an infringement analysis, the dispute would likely focus on several technical and legal questions based on the patent's claims and the general nature of the technologies.

• Scope Questions: A potential dispute may arise over the meaning of "secreted filamentous phage" (a term added during prosecution) and whether Plaintiff's HuCAL system, if it uses a different phage or expression system, falls within the scope of that limitation (Compl. ¶48).
• Technical Questions: An evidentiary dispute may center on whether Plaintiff's HuCAL method, as practiced by its licensees, performs each step recited in Claim 1. This includes questions about how the "repertoire" is created, how the antibody member is "displayed on the surface of the phage," and the specific steps used to produce the final antibody "in a form free from the phage."

V. Key Claim Terms for Construction

• The Term: "a single polypeptide chain comprising a binding domain of an antibody"
• Context and Importance: This term defines the structure of the antibody fragment being displayed (e.g., a single-chain Fv or "scFv"). The complaint alleges that Defendant, during prosecution, argued there was a "prejudice in the art" against displaying larger protein fragments and distinguished its invention from prior art on this basis (Compl. ¶¶ 43, 48-49). The construction of this term would be critical to determining both the scope of the claim and its validity in light of prior art that may have disclosed different types of antibody fragments.

Intrinsic Evidence for Interpretation

• Evidence for a Broader Interpretation: The specification provides multiple examples of antibody binding domains, including single domain antibodies (dAbs), Fab fragments, and Fv fragments, which could suggest the term is not limited to a single specific structure ('108 Patent, col. 18:5-9).
• Evidence for a Narrower Interpretation: The patent repeatedly emphasizes the novelty of displaying scFvs and provides specific examples and figures related to scFv construction and display ('108 Patent, Abstract; Fig. 5a). An accused infringer might argue that the term should be limited to the scFv embodiment that the patentee emphasized to overcome prior art.

VI. Other Allegations

Inequitable Conduct

This is the central allegation of the complaint. Plaintiff alleges that Defendant and its attorneys committed inequitable conduct by intentionally withholding material prior art from the USPTO during the prosecution of the '108 patent (Compl. ¶¶ 64-76).

• The Withheld Reference: The "Smith Grant," an NIH grant application from Dr. George Smith, is alleged to be a "printed publication" prior art under 35 U.S.C. § 102 (Compl. ¶52, ¶65).
• Materiality: The complaint alleges the Smith Grant was highly material because it (1) anticipates or renders obvious numerous claims of the ’108 patent, and (2) directly refutes a key argument for patentability made by Defendant during prosecution—namely, that there was a "prejudice in the art" against displaying scFvs on phage, a concept the Smith Grant allegedly proposed to do (Compl. ¶49, ¶54-56).
• Intent to Deceive: Plaintiff alleges that Defendant and its attorneys were aware of the Smith Grant and its materiality as early as May 1996 but made a "deliberate decision not to disclose" it to the USPTO, thereby intending to deceive the examiner (Compl. ¶72, ¶76).

Indirect Infringement

Plaintiff seeks a declaration that it is not liable for induced or contributory infringement, based on its licensing of the HuCAL technology to U.S. customers (Compl. ¶12, ¶61).

VII. Analyst’s Conclusion: Key Questions for the Case

1. A primary question for the court will be one of unenforceability: did Defendant’s failure to disclose the Smith Grant to the USPTO rise to the level of inequitable conduct? This will require a factual determination of whether the grant was material prior art and whether Defendant acted with a specific intent to deceive the patent office.
2. A related core issue is validity: independent of the inequitable conduct claim, does the Smith Grant, either alone or in combination with other references, anticipate or render obvious the claims of the ’108 patent? The outcome will depend on what the Smith Grant actually discloses and how it compares to the patent’s claims.
3. Should the patent be found valid and enforceable, the case would turn on a question of infringement: does the Plaintiff's HuCAL technology, as licensed and practiced in the U.S., meet every limitation of at least one claim of the '108 patent, particularly concerning the specific type of antibody fragment and phage system recited in the claims?