Federal Circuit overturns 9.1 million dollar fee award against ChromaDex
Judges ruled that defending the eligibility of an isolated vitamin composition was not an exceptionally unreasonable legal stance
The U.S. Court of Appeals for the Federal Circuit has overturned a 9.1 million dollar legal fee award against ChromaDex in its long-running dispute with Elysium Health. The appellate court ruled that ChromaDex presented a plausible defense of its patent eligibility under Section 101, meaning the case did not qualify as exceptional under federal patent law.
A disputed dietary supplement formulation
The litigation began in 2018 when ChromaDex sued Elysium Health for infringing U.S. Patent No. 8,197,807, titled "Nicotinamide riboside kinase compositions and methods for using the same." ChromaDex sells dietary supplements that use technology licensed from Dartmouth College, as reported by IPWatchdog. The invention covers a composition containing isolated nicotinamide riboside, a form of vitamin B3 naturally found in cow milk, designed to increase the biosynthesis of nicotinamide adenine dinucleotide when taken orally. Elysium Health argued that the asserted patent claims covered an unpatentable product of nature, leading the U.S. District Court for the District of Delaware to grant summary judgment invalidating the claims under Section 101.
“While ChromaDex’s arguments ultimately did not prevail, it cannot be said that the substantive strength of its § 101 position was so [exceptionally] meritless or unreasonable as to make this case stand out from others.”
— U.S. Court of Appeals for the Federal Circuit
Beyond the scope of natural products precedents
After the Federal Circuit upheld the invalidation in 2023, Elysium sought attorneys' fees under 35 U.S.C. § 285, claiming ChromaDex should have known its intellectual property claims could not survive the legal precedent set in Ass'n for Molecular Pathology v. Myriad Genetics. The Delaware district court agreed and ordered ChromaDex to pay 9.1 million dollars, according to the account from IPWatchdog. However, the appeals court determined that the lower court abused its discretion because analyzing ChromaDex's claims required evaluating technical considerations well beyond whether an element was structurally isolated. The judges observed that legal analysis required examining whether the composition possessed markedly different characteristics, delivered distinct utility, and required specific amounts of the active ingredient.
The threshold for exceptional case designations
Under federal rules, courts award legal fees only when a party brings claims that stand out significantly for their lack of substantive strength. Although the appellate court previously confirmed that the asserted patent was broad enough to encompass natural milk, ChromaDex's legal arguments had addressed separate factors including biosynthesis rates and composition differences documented by IPWatchdog. The ruling establishes that losing an eligibility dispute over natural derivatives does not automatically expose a patent holder to punitive fee awards, provided the legal theory presents a reasonable argument under statutory standards.
