DCT
1:24-cv-00465
Inolex Inc v. Actera Ingredients Inc
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Inolex, Inc. and Inolex Investment Corp. (Delaware)
- Defendant: Actera Ingredients, Inc. (Delaware)
- Plaintiff’s Counsel: Cozen Oconnor
- Case Identification: 1:24-cv-00465, D. Del., 04/11/2024
- Venue Allegations: Venue is alleged to be proper in the District of Delaware because Defendant is incorporated in Delaware and offers for sale, sells, and/or distributes the accused product within the judicial district.
- Core Dispute: Plaintiff alleges that Defendant’s TeraStat™ N cosmetic preservative infringes patents related to preservative compositions that combine a hydroxamic acid with a diol.
- Technical Context: The technology pertains to preservative systems for the personal care industry, a market where there is significant demand for formulations that are effective, safe, and free from controversial ingredients like parabens and formaldehyde-donors.
- Key Procedural History: The complaint alleges that the sole named inventor on both asserted patents, Mr. Daniel Winn, is the CEO of Defendant Actera, was previously employed by Plaintiff Inolex, and developed the accused product based on technology he contributed to while at Inolex. This allegation of direct personal knowledge by the inventor is central to the claims of willful infringement.
Case Timeline
| Date | Event |
|---|---|
| 2007-11-29 | Earliest Priority Date for '899 and '204 Patents |
| 2019-04-14 | Accused Product "TeraStat™ N" Listed on UL Prospector |
| 2021-01-26 | U.S. Patent No. 10,897,899 Issues |
| 2022-04-05 | U.S. Patent No. 11,291,204 Issues |
| 2022-07-01 | Plaintiff Launches its Spectrastat™ CGE Natural MB Product |
| 2024-04-11 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 10,897,899 - Preservatives for Cosmetic, Toiletry and Pharmaceutical Compositions
- Patent Identification: U.S. Patent No. 10,897,899, issued January 26, 2021 (Compl. ¶11).
The Invention Explained
- Problem Addressed: The patent’s background section describes a need in the cosmetics industry for preservative systems that are effective, globally approved, and avoid the negative consumer perceptions and potential health or irritation concerns associated with prior art preservatives like parabens, formaldehyde donors, and chlorinated compounds (’899 Patent, col. 2:10-65). It specifically notes that many existing alternatives, such as organic acids, are ineffective at the neutral pH levels common in many personal care products (’899 Patent, col. 3:19-24).
- The Patented Solution: The invention claims to solve this problem by creating a preservative blend that combines at least one hydroxamic acid with at least one diol (’899 Patent, Abstract). This combination is described as providing broad-spectrum antimicrobial efficacy, including at neutral pH, in a formulation that is free of parabens and other undesirable components (’899 Patent, col. 4:1-9).
- Technical Importance: This approach provided a preservative system aligned with the growing market demand for "clean" or "natural" cosmetic formulations that do not sacrifice antimicrobial performance (’899 Patent, col. 4:1-9).
Key Claims at a Glance
- The complaint asserts independent claim 1 (Compl. ¶15).
- Essential elements of Claim 1 include:
- A preservative composition blend comprising
- about 4.5% to about 15% caprylohydroxamic acid or a salt thereof
- wherein caprylohydroxamic acid is the only hydroxamic acid in the composition blend
- and about 7% to about 95.5% of a diol selected from a specified list of compounds, including propanediol and caprylyl glyceryl ether (’899 Patent, col. 21:9-18).
- The complaint reserves the right to assert dependent claims, specifically alleging infringement of claims 1-5 and 7-10 (Compl. ¶¶ 39-40, 57).
U.S. Patent No. 11,291,204 - Preservatives for Cosmetic, Toiletry and Pharmaceutical Compositions
- Patent Identification: U.S. Patent No. 11291204, issued April 5, 2022 (Compl. ¶20).
The Invention Explained
- Problem Addressed: The patent addresses the same technical problem as the ’899 Patent: the need for effective, safe, and consumer-friendly preservatives for personal care products, particularly those that function at neutral pH (’204 Patent, col. 2:10-65).
- The Patented Solution: The invention is a preservative composition that combines a "single alkylhydroxamic acid" with at least one diol, and is explicitly "free of parabens" (’204 Patent, col. 19:26-39). The core technology is substantively identical to that of the related ’899 Patent, focusing on the synergistic antimicrobial effect of the hydroxamic acid and diol blend (’204 Patent, Abstract; col. 4:9-14).
- Technical Importance: The invention provides a preservative technology that meets the criteria for "paraben-free" marketing claims while ensuring broad-spectrum microbial protection in cosmetic formulations (’204 Patent, col. 4:1-9).
Key Claims at a Glance
- The complaint asserts independent claim 1 (Compl. ¶24).
- Essential elements of Claim 1 include:
- A preservative composition comprising
- (i) a hydroxamic acid or a salt thereof consisting essentially of a single alkylhydroxamic acid or a salt thereof, selected from a specified list (including caprylohydroxamic acid), present in a concentration of about 4.5% to about 15%
- (ii) at least one diol present in a concentration of about 7% to about 95.5%, selected from a specified list (including propanediol and caprylyl glyceryl ether)
- wherein the composition is free of parabens (’204 Patent, col. 19:26-39).
- The complaint reserves the right to assert dependent claims, specifically alleging infringement of claims 1-15 (Compl. ¶¶ 42-44, 69).
III. The Accused Instrumentality
Product Identification
- The accused instrumentality is Defendant Actera's "TeraStat™ N" product (Compl. ¶28).
Functionality and Market Context
- TeraStat™ N is a preservative ingredient blend sold for use in cosmetic and personal care products (Compl. ¶31). The complaint alleges, based on testing, that the product is a mixture containing approximately 7.4-7.6 wt-% Caprylhydroxamic Acid (CHA), 23 wt-% Caprylyl Glyceryl Ether (CGE), and 63 wt-% Propanediol (PDO) (Compl. ¶¶ 31, 36).
- The product is marketed as a "Clean & Natural Preservation" system suitable for "all-natural and clean beauty formulations" and is promoted as being "highly efficient against bacteria, yeast, and mold" (Compl. ¶32). Actera’s product bulletins recommend adding TeraStat™ N to formulations at a level of "1.5 to 2.5%" (Compl. ¶33).
IV. Analysis of Infringement Allegations
'899 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| A preservative composition blend comprising... | TeraStat™ N is a preservative blend marketed for use in personal care products. | ¶32 | col. 21:9 |
| about 4.5% to about 15% caprylohydroxamic acid or a salt thereof | Plaintiff's analysis of a lot of TeraStat™ N allegedly showed it contains approximately 7.4-7.6 wt-% of Caprylhydroxamic Acid (CHA). | ¶36 | col. 21:9-10 |
| wherein caprylohydroxamic acid is the only hydroxamic acid in the composition blend | Plaintiff’s High Performance Liquid Chromatography (HPLC) analysis allegedly showed that CHA is the only alkylhydroxamic acid present in the accused product. | ¶38 | col. 21:11-12 |
| and about 7% to about 95.5% of a diol selected from the group consisting of a propanediol, ... caprylyl glyceryl ether, ... and combinations thereof. | TeraStat™ N allegedly contains approximately 63 wt-% Propanediol (PDO) and 23 wt-% Caprylyl Glyceryl Ether (CGE), both of which are recited diols, for a total diol concentration of approximately 86%. | ¶36 | col. 21:12-18 |
'204 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| A preservative composition comprising... | TeraStat™ N is a preservative composition sold for use in personal care formulations. | ¶32 | col. 19:26 |
| (i) a hydroxamic acid... consisting essentially of a single alkylhydroxamic acid... selected from... caprylohydroxamic acid... present in a concentration of about 4.5% to about 15% | The accused product allegedly contains 7.4-7.6 wt-% of caprylohydroxamic acid, and HPLC analysis allegedly showed it to be the only alkylhydroxamic acid present. | ¶¶ 36, 38 | col. 19:27-33 |
| (ii) at least one diol present in a concentration of about 7% to about 95.5% selected from the group consisting of: propanediol, ... caprylyl glyceryl ether, ... and combinations thereof | As described in Section III, the product allegedly contains a combination of Propanediol and Caprylyl Glyceryl Ether totaling approximately 86% by weight. | ¶36 | col. 19:33-38 |
| wherein the composition is free of parabens. | TeraStat™ N is marketed as a "Clean & Natural" preservative, a category understood in the industry to be free of parabens. | ¶32 | col. 19:38-39 |
- Identified Points of Contention:
- Factual Question: The central dispute appears to be factual: what is the actual chemical composition of TeraStat™ N? The complaint highlights a visual from Actera's product bulletin stating, "For intellectual property purposes, composition contains additional additive hydroxamic acids" (Compl. ¶35). Plaintiff alleges this statement is false and was made to create the appearance of non-infringement of the "only hydroxamic acid" limitation of the ’899 Patent (Compl. ¶¶ 38, 51-52). The case may turn on dueling chemical analyses of the accused product.
- Scope Questions: If Actera’s product is found to contain other hydroxamic acids, the focus will shift to claim scope. The court would need to determine if the phrase "only hydroxamic acid" in the ’899 Patent can tolerate trace impurities. For the ’204 Patent, the question would be whether any additional hydroxamic acids "materially affect the basic and novel properties" of the invention under the "consisting essentially of" standard.
V. Key Claim Terms for Construction
"only hydroxamic acid" (’899 Patent, Claim 1)
- Context and Importance: This term is critical because infringement of the ’899 Patent appears to hinge on whether the accused product contains any hydroxamic acid other than caprylohydroxamic acid. Plaintiff alleges Actera's marketing materials falsely claim the presence of other such acids specifically to avoid this limitation (Compl. ¶¶ 35, 38).
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation (more permissive for Defendant): A defendant could argue the term should not cover de minimis or trace-level impurities that result from manufacturing and are not added to perform a preservative function. The specification does not explicitly address manufacturing impurities.
- Evidence for a Narrower Interpretation (more permissive for Plaintiff): The plain language of the claim is absolute. The use of "only" is an explicit, unambiguous exclusion of all other members of the specified chemical class, regardless of their source or concentration (’899 Patent, col. 21:11-12).
"consisting essentially of a single alkylhydroxamic acid" (’204 Patent, Claim 1)
- Context and Importance: As a legal term of art, the construction of this phrase will be pivotal if the accused product is found to contain more than one hydroxamic acid. It creates a different and potentially wider scope than the "only" limitation in the ’899 Patent. Practitioners may focus on this term because it allows for the presence of unrecited ingredients so long as they do not materially alter the "basic and novel properties" of the claimed invention.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation (more permissive for Defendant): The patent describes the invention's properties as providing broad-spectrum, paraben-free preservation (’204 Patent, col. 4:1-9). A defendant could argue that trace amounts of other hydroxamic acids do not materially alter this core functionality.
- Evidence for a Narrower Interpretation (more permissive for Plaintiff): A plaintiff could argue that a "basic and novel" property of the invention is the use of a single hydroxamic acid in combination with a diol, and that adding any other hydroxamic acid inherently alters that property. The claim’s structure, which singles out one acid from a list, could support this view (’204 Patent, col. 19:27-33).
VI. Other Allegations
- Indirect Infringement: The complaint alleges inducement based on Actera’s product bulletins, which allegedly instruct customers on how to incorporate TeraStat™ N into personal care products in a manner that infringes method claims of the patents (Compl. ¶¶ 40, 44). Contributory infringement is alleged on the basis that TeraStat™ N is a material component of an infringing formulation, is not a staple article of commerce, and lacks substantial non-infringing uses (Compl. ¶¶ 41, 45).
- Willful Infringement: The complaint alleges willfulness based on several factors, most notably that Actera’s CEO is the named inventor of the Asserted Patents and a former Inolex employee who allegedly developed the accused product using technology from his time at Inolex (Compl. ¶46). Further allegations include Actera’s status as a direct competitor, its alleged monitoring of the patent landscape, Inolex's public announcements of the patents' issuance, and Actera's subsequent modification of its product bulletins with language allegedly intended to evade infringement (Compl. ¶¶ 47-52).
VII. Analyst’s Conclusion: Key Questions for the Case
- A central question will be one of factual composition: What are the actual chemical constituents of the accused TeraStat™ N product? The outcome may depend heavily on competing forensic analyses presented by the parties to prove or disprove the presence of "additional additive hydroxamic acids" as claimed in Defendant's marketing materials.
- The case will also present a core issue of claim scope and potential evasion: Should other hydroxamic acids be found, the dispute will turn on whether the '899 Patent's "only" limitation can be interpreted to permit their presence, and whether the '204 Patent's "consisting essentially of" language can be construed to mean their presence is an immaterial addition that does not alter the invention’s fundamental character.
- Finally, a significant factor will be the allegations of knowledge and intent: The unique fact pattern, where the defendant's CEO is the patents' inventor and a former employee of the plaintiff, raises profound questions about pre-suit knowledge that will be central to the willfulness inquiry and potential for enhanced damages.