Merck & Co. v. Chase Chemical Company

• Decision Date: 01 September 1967
• Docket Number: Civ. A. No. 270-62.
• Citation: 273 F. Supp. 68,155 USPQ 139
• Court: U.S. District Court — District of New Jersey
• Parties: MERCK & CO., Inc., Plaintiff, v. CHASE CHEMICAL COMPANY, Arroyo Pharmaceutical Corporation, Sidney Chasman and Randolph Chasman, Defendants.

273 F. Supp. 68

155 USPQ 139

MERCK & CO., Inc., Plaintiff, v. CHASE CHEMICAL COMPANY, Arroyo Pharmaceutical Corporation, Sidney Chasman and Randolph Chasman, Defendants.

Civ. A. No. 270-62.

United States District Court D. New Jersey.

September 1, 1967.

Shanley & Fisher, Newark, N. J., by Frank L. Bate, Newark, N. J., Ward, Haselton, McElhannon, Orme, Brooks & Fitzpatrick, by Joseph M. Fitzpatrick, Charles B. Cannon and Laurence F. Scinto, New York City, of counsel, for plaintiff.

Dughi, Johnstone & O'Dwyer, Westfield, N. J., by Louis J. Dughi, Westfield, N. J., Davis, Hoxie, Faithfull & Hapgood, by John Hoxie and William Kilgannon, New York City, of counsel, for defendants.

OPINION

AUGELLI, District Judge:

This is an action for infringement of United States Letters Patent No. 2,563,794 ('794 patent) and No. 2,703,302 ('302 patent). The subject matter is vitamin B-12 and vitamin B-12 active compositions.

Plaintiff Merck & Co., Inc. (Merck) is a New Jersey corporation, having a place of business in Rahway, New Jersey, and is the owner, by assignment, of the '794 and '302 patents.

Defendant Chase Chemical Company (Chase), is a New Jersey corporation, having a place of business in Newark, New Jersey.

Defendants Sidney and Randolph Chasman, are residents of New Jersey, and President and Secretary-Treasurer, respectively, of Chase.

Defendant Arroyo Pharmaceutical Corporation (Arroyo),¹ is a Puerto Rican corporation, having a manufacturing plant in Arroyo, Puerto Rico.

This Court has jurisdiction over the subject matter and of the parties to this action. This is admitted by defendants, as is also the proper laying of venue. 35 U.S.C.A. §§ 271 and 281; 28 U.S.C.A. §§ 1338(a), 1391(c), 1400(b), 2201 and 2202.

The action was tried to the Court on the issues of validity and infringement of the '794 and '302 patents as raised by Merck's original, amended, and supplemental complaints, and defendants' answers thereto, and on defendants' counterclaims for a declaratory judgment of invalidity and non-infringement of the patents. Merck seeks a permanent injunction, an accounting for damages, and an award of treble damages and reasonable attorneys' fees because of the alleged "deliberate and wilful" infringement of the patents by defendants.

The '794 patent, entitled "Vitamin B-12" issued on August 7, 1951, in the names of Edward L. Rickes and Thomas R. Wood, as co-inventors, on an application, Serial No. 108,668, filed August 4, 1949. Said application is stated in the patent to be "a continuation-in-part of our pending applications, Serial No. 20,356, filed April 10, 1948, now abandoned, and Serial No. 38,175, filed July 10, 1948."

The invention of the '794 patent is said to relate "to the preparation and isolation of a therapeutically valuable substance and more particularly, to the preparation of a substance obtained by the cultivation of suitable strains of the microorganism STREPTOMYCES GRISEUS in suitable culture mediums". It is further stated that the "new chemical compound", which Rickes and Wood named "vitamin B-12", is "capable of promoting the growth of LACTOBACILLUS LACTIS Dorner, and possesses marked and effective action in the therapeutic treatment of Addisonian pernicious anemia² and other macrocytic anemias."

The '794 patent contains but one claim, a product claim, which reads as follows:

"The compound vitamin B-12, an organic substance containing cobalt, together with carbon, nitrogen, hydrogen, oxygen, and phosphorous, said compound being a red crystalline substance soluble in water, methyl and ethyl alcohol and phenol, and insoluble in acetone, ether and chloroform, and exhibiting strong absorption maxima at about 2780 Å., 3610 Å. and 5500 Å., and an L.L.D. activity of about 11,000,000 L.L.D. units per milligram."³

The '302 patent, entitled "Vitamin B-12 Active Composition and Process of Preparing Same", issued on March 1, 1955, also in the names of Rickes and Wood, as co-inventors, on an application, Serial No. 324,834, filed December 8, 1952. Said application is stated in the patent to be "a continuation-in-part of our co-pending applications Serial No. 38,175, filed July 10, 1948, now abandoned, Serial No. 110,222, filed August 4, 1949, now Patent No. 2,695,862, and Serial No. 146,404, filed February 25, 1950, which applications are, in turn, continuations-in-part of our application Serial No. 20,356, filed April 10, 1948, now abandoned."

The invention of the '302 patent, as set forth therein, "is concerned generally with the production of valuable vitamin products by fermentation. More particularly, it relates to vitamin B-12 active concentrates which possess animal protein factor (APF)⁴ activity, and which can be characterized by their property of promoting the growth of the microorganism LACTOBACILLUS LACTIS Dorner (L.L.D.), and to methods for producing such vitamin B-12 active, APF-active and L.L.D.-active materials utilizing selected strains of microorganisms belonging to the subphylum Fungi. These vitamin B-12 active concentrates are valuable as feed supplements and for the treatment of nutritional diseases."

The '302 patent contains 12 claims, but of these only product claims 1, 2 and 3, and process claims 4, 5, 6, 11 and 12 are at issue.

The product claims are practically identical and differ only in the minimal limit of the L.L.D. activity at 440, 1500 and 65,000 L.L.D. units per milligram in each claim, respectively. Product claim 1 is typical and reads as follows:

"1. A vitamin B-12 active composition comprising recovered elaboration products⁵ of the fermentation of a vitamin B-12 activity producing strain of Fungi selected from the class consisting of Schizomycetes, Torula, and Eremothecium, the L.L.D. activity of said composition being at least 440 L.L.D. units per milligram and less than 11 million L.L.D. units per milligram."

Of the process claims of the '302 patent in issue, claim 5 is typical and reads as follows:

"5. A process for the production of a vitamin B-12 active composition which comprises fermenting an aqueous nutrient medium under submerged aerated conditions by means of a vitamin B-12 activity producing strain of Fungi selected from the class consisting of Schizomycetes, Torula, and Eremothecium, extracting vitamin B-12 active substances therefrom, and recovering from the resulting extract a vitamin B-12 active composition having an L.L.D. activity of at least 440 units per milligram."

Process claim 4 differs from 5 in defining the process as one for the production of an L.L.D. active composition; process claim 6 differs from 5 in specifically limiting the vitamin B-12 activity producing organism to a strain of Schizomycetes; process claim 11 differs from 5 in reciting the lower limit of L.L.D. activity of the vitamin B-12 active composition produced in accordance with the claimed process as being at least 1500 L.L.D. units per milligram; and process claim 12 differs from 5 in reciting the lower limit of L.L.D. activity as at least 1500 and in limiting the vitamin B-12 activity producing organism recited in said claim to a vitamin B-12 activity producing strain of Schizomycetes.

It may be noted here that in connection with product claim 1, and process claims 4, 5 and 6 of the '302 patent, Merck asserts that the lower limit of 440 L.L.D. units per milligram as recited in said claims, excludes such impractical and low potency fermentation products as may have existed in nature, and that a composition having a vitamin B-12 activity of at least 440 L.L.D. units per milligram, within the language of the claims, is sufficiently potent and concentrated to insure freedom from undesirable or toxic materials.

For a better understanding of the issues involved in this litigation, some recital of the history leading to the issuance of the patents in suit is necessary.

Prior to 1926, medical science could offer very little help to persons afflicted with the disease of pernicious anemia. But in 1926, Doctors Minot and Murphy, of Harvard Medical School, found that pernicious anemia patients were benefitted by the addition to their diets of substantial quantities of the liver of cattle. For this discovery Minot and Murphy received the Nobel Prize. But neither they nor anyone else knew what it was in liver that controlled the disease. The Minot-Murphy discovery spurred efforts by medical and pharmaceutical workers throughout the world to attempt to isolate and identify the factor in liver that was responsible for the beneficial anti-pernicious anemia effect.

The search for the anti-pernicious anemia factor (APAF) in liver was long and tedious. New extracts and concentrates of liver were developed, but they could only be tested by administration to pernicious anemia patients in relapse, and opportunities for such clinical testing were not plentiful. By 1947, however, a number of liver extracts and concentrates were on the market. These preparations reduced substantially the dosage amounts required by patients, but some patients were unable to tolerate them, and they were expensive.

Just what it was in liver that was responsible for the anti-pernicious anemia factor remained a matter of speculation. Some researchers were of the opinion that multiple factors were involved. Others thought the factor was a hormone produced within the body of the animal. Still others believed it might be a vitamin formed in the liver of cattle after slaughter by postmortem autolysis. Tests, however, indicated no relationship between the liver fractions and the then known vitamins. In short, it may be said that there were as many different theories concerning the identity of the beneficial substance in liver as there were investigators.

An indication of the scope and complexity of the problem that confronted the investigators in their efforts to isolate and identify the anti-pernicious factor in liver is disclosed in a joint report published in 1945 by Dr. Subbarow, Research Director of...