Guest Posts: Preparing for Mayo v. Prometheus Labs

By Professor John Golden, Professor in Law, The University of Texas at Austin

Mayo Collaborative Services v. Prometheus Laboratories, Inc., No. 10-1150 (S. Ct.)

Scheduled for oral argument on Wednesday, December 7, 2011

In Mayo Collaborative Services v. Prometheus Laboratories, Inc., the U.S. Supreme Court looks to address questions of whether and when certain types of medical methods are patentable subject matter. Prometheus specifically involves methods for optimizing patient treatment in which the level of a drug metabolite is measured and a measured level above or below a recited amount "indicates a need" to decrease or increase dosage levels. In 2005, the Court granted certiorari on related issues in Laboratory Corp. of America v. Metabolite Laboratories, Inc., but the Court later dismissed LabCorp as improvidently granted. In 2010, the Court reaffirmed the existence of meaningful limitations on patentable subject matter in Bilski v. Kappos, but the Court but did little to clarify the scope of those limitations.

Will Prometheus bring light where Bilski failed? Arguments to the Court invite it to further clarify the status of the machine-or-transformation test for process claims. Bilski indicated that this test is relevant but not necessarily decisive, and the Federal Circuit relied heavily on the test in upholding the subject-matter eligibility of Prometheus's claims. In the circuit's view, "asserted claims are in effect claims to methods of treatment, which are always transformative when one of a defined group of drugs is administered to the body to ameliorate the effects of an undesired condition." Likewise, a metabolite-level measurement step was found to "necessarily involv[e] a transformation." Although Prometheus's claims include "mental steps," the circuit emphasized that the inclusion of such steps "does not, by itself, negate the transformative nature of prior steps."

Prior posts provide additional background on the Prometheus case. The first wave of merits briefs have been filed. These include the opening brief for the petitioners, briefs in support of the petitioners, and briefs in support of neither party. The respondent-patentee's brief as well as supporting amicus briefs will be due in the upcoming weeks.

BRIEF FOR PETITIONERS (Stephen Shapiro, Mayer Brown): Prometheus's patent claims violate Supreme Court precedent forbidding claims that "preemp[t] all practical use of an abstract idea, natural phenomenon, or mathematical formula." Prometheus's claims "recite a natural phenomenon—the biological correlation between metabolite levels and health—without describing what is to be done with that phenomenon beyond considering whether a dosage adjustment may be necessary." The claims' drug-administration and metabolite-measurement steps are merely "'token' and 'conventional' data-gathering steps" that cannot establish subject-matter eligibility. Patent protection is unnecessary to promote the development of diagnostic methods like those claimed and will in fact interfere with both their development and actual medical practice.


AARP & PUBLIC PATENT FOUNDATION (Daniel Ravicher, Public Patent & Cardozo School of Law): "Allowing patents on pure medical correlations … threatens doctors with claims of patent infringement" and "burdens the public with excessive health care costs, and dulls incentives for real innovation." "The Federal Circuit has latched on to trivial steps beyond mental processes, such as the 'administering' step in this case, to uphold patents that effectively preempt all uses of laws of nature." Prometheus's recitation of an "administering" step stands "in stark contrast to most pharmaceutical patents that require a 'therapeutically effective amount' of a drug be administered."

ACLU (Sandra Park, ACLU): In assessing subject matter eligibility, the Supreme Court "has focused on the essence of the claim," using a "pragmatic approach [that] allows the Court to see through clever drafting." Prometheus's insertion of drug-administration and/or measurement steps into a claim "does not alter the fact that the essence of the claim is the correlation between thiopurine drugs and metabolite levels in the blood." Further, the First Amendment bars Prometheus's claims. "What Prometheus seeks to monopolize … is the right to think about the correlation between thiopurine drugs and metabolite levels, and the therapeutic consequences of that correlation."

AMERICAN COLLEGE OF MEDICAL GENETICS ET AL. (Katherine Strandburg, NYU School of Law): The patents at issue "grant exclusive rights over the mere observation of natural, statistical correlations." They "convert routine, sound medical practice into prohibited infringement" and generate burdens and conflicts for patient care and follow-on innovation. "The machine or transformation test is inapposite … to determining whether a claim preempts a natural phenomenon." It can be too trivially satisfied without shedding sufficient light on whether claims "reflect inventive activity" or "improperly preempt downstream uses of the phenomenon."

ARUP & LABCORP (Kathleen Sullivan, Quinn Emanuel): "The patents assert exclusive rights over the process of administering a drug and observing the results…. This not only blocks the mental work of doctors advising patients, but also impedes the progress of research by seeking to own a basic law of nature concerning the human body's reaction to drugs." "Patents on measurements of nature" raise constitutional concerns by removing factual information from the public domain, thereby conflicting with patents' constitutional purpose to "promote the Progress of Science and useful Arts" and threatening to chill "scientific and commercial publication."

CATO INSTITUTE ET AL. (Ilya Shapiro, Cato Institute): This case provides the Supreme Court with an opportunity to strike a blow against the "thousands of abstract process patents which have been improvidently granted since the 1990s" and that are already adversely affecting software and financial innovation. Historically, patentable "processes" "aimed to produce an effect on matter, and these patents do not." The "indicat[ing] a need" clauses in Prometheus's claims do not even form part of a process because they do "not describe an action." Patent claims such as these, "whose final step is mental," impermissibly tread on the public domain and "freedom of thought."

NINE LAW PROFESSORS (Joshua Sarnoff, DePaul College of Law): The Supreme Court "should expressly recognize" that the Constitution requires that "laws of nature, physical phenomena, and abstract ideas" be treated as prior art for purposes of determining patentability. "Allowing patents for uncreative applications would effectively provide exclusive rights in and impermissibly reward the ineligible discovery itself." Barring claims like Prometheus's under section 101, as opposed to relying on patentability requirements such as novelty and nonobviousness, promotes "efficient gate-keeping" and "sends important signals."

VERIZON & HP (Michael Kellogg, Kellogg Huber): "It is longstanding law that a claim is non-patentable if it recites a prior art process and adds only the mental recognition of a newly discovered property of that process." See Gen. Elec. Co. v. Jewel Incandescent Lamp Co., 326 U.S. 242 (1945). "This principle is soundly based on Section 101's limitation to processes and products that are not only 'useful' but 'new.'" "[A]dding to the old process in Prometheus's patent claims nothing more than a mental step of recognizing the possible health (toxicity or efficacy) significance of the result of the process does not define a 'new and useful process.'"


UNITED STATES (Solicitor General Donald Verrilli, Jr.): The claimed methods recite "patent-eligible subject matter," and petitioners' objections to patentability are properly understood as challenges to the claimed methods' novelty and nonobviousness. By analogy with "patent law's 'printed matter' doctrine," the claims should ultimately be found invalid because, as construed by the district court, they "merely … appen[d] a purely mental step or inference to a process that is otherwise known in (or obvious in light of) the prior art." But the Supreme Court should affirm the Federal Circuit's holding on subject matter eligibility.

AIPPI (Peter Schechter, Edwards Wildman): AIPPI "encourages all member countries to allow medical personnel the freedom to provide medical treatment of patients without the authorization of any patentee." Unlike the U.S. and Australia, most countries "exclud[e] methods of medical treatment of patients from patent eligibility." When the medical-practitioner exemption of 35 U.S.C. § 287(c)(1) applies, "the courts lack subject matter jurisdiction." The exemption applies to the defendants, who "are plainly 'related health care entities.'" Thus, "the case should be dismissed for lack of federal subject matter jurisdiction."

MICROSOFT (Matthew McGill, Gibson Dunn): Subject-matter eligibility tests should not involve "pars[ing] the claimed invention into the 'underlying invention' and those aspects that are 'conventional' or 'obvious' or insignificant 'extra- or post-solution activity.'" Such parsing lacks any guiding principle that can make its application predictable. Petitioners seek an improperly "expansive application of the mental steps doctrine." "[I]f every step of a process claim can be performed in the human mind, that process is unpatentable." But the Federal Circuit has improperly "extended th[is] principle to apply to machines or manufactures that replicate mental steps."

NYIPLA (Ronald Daignault, Robins Kaplan): Innovation's "bewildering pace" argues against "rigid categorization of patent-eligible subject matter." "[T]here is no basis for excluding processes directed to analyzing the chemicals in a patient's body from patent eligibility." When satisfied, the machine-or-transformation test should decisively establish eligibility. But failure of the test should not necessarily establish ineligibility. Preemption analysis "must incorporate a critical assessment of whether the claim at issue actually claims a fundamental principle as a fundamental principle in contrast to an application of that principle."

ROCHE & ABBOTT (Seth Waxman, WilmerHale): Patents are crucial for innovation in personalized medicine and more particularly for the continued development diagnostic tests that can enable such medicine's practice. Arguments "that patents on diagnostic tests stifle innovation and basic scientific research" are "largely based on speculation, rather than sound evidence." Generally speaking, "market-driven business practices and self-enforcing market norms correct for any perceived limitations on the accessibility of patented diagnostic technologies." Congress should be trusted to provide appropriate patent-law exemptions for medical practice and research.

Global-Tech v. SEB: Respondent and Additional Amicus Briefs

By Jason Rantanen

In Global-Tech v. SEB, the Supreme Court is addressing the state of mind requirement for inducement of infringement.  The petitioner, along with several amicus briefs filed in support, argues that inducement should require that the accused intend to infringe the patent, and that the accused infringer must know of the patent being infringed.  Earlier Patently-O discussions of those briefs are available here and here.

Last week, the respondent (SEB) filed its briefs.  SEB argues that there is no basis for requiring evidence that the accused party possess actual knowledge of the patent; rather, inducement must require a lower state of mind standard than both 35 U.S.C. § 271(c) (contributory infringement) and willful infringement, a standard that is met by Pentalpha's conduct.  In the alternative, SEB argues that Pentalpha's conduct constituted willful blindness, which SEB contends is a form of constructive knowledge and thus is sufficient for inducement.  In addition, SEB argues that the Court should affirm because all the damages were attributable to Pentalpha's direct infringement and because, through it's finding of willful infringement, the jury necessarily found that Pentalpha had actual knowledge of the patent.

Several amicus curiae have also filed briefs in support of the respondent, all arguing that inducement should require only intent to cause the acts as opposed to some form of scienter with respect to whether those acts infringe a patent.  Among these is the brief of a group of law professors led by Professor Ted Sichelman, argues that inducement should require only specific intent to cause the infringing acts – not some form of scienter with respect to whether the acts infringed a patent.  The brief supports this argument by looking to tort and criminal law, pointing out that in those contexts it is not necessary for the accused to know that that the acts violate a legal duty – only that the accused intend to cause the acts themselves. It also argues that prior to the 1952 Patent Act, no court (with one exception as dicta), held that indirect infringement required knowledge of the patent.  Thus, the brief argues, while inducement of infringement should require specific intent to further the acts of direct infringement, it did not traditionally – and should not – require any form of knowledge of whether those acts infringe a patent. 

Oral Argument is set for Wednesday, February 23, 2011.

SEB's Brief:

Amicus Briefs in Support of Respondent:

Note: I understand additional briefs may have been filed, including one on behalf of several companies and PhRMA, that do not appear on the ABA site.  This post will be updated when those briefs are available.

Global-Tech v. SEB: Amicus Briefs

By Jason Rantanen

Several amicus briefs supporting Global-Tech/neither party were filed yesterday.  Among them is a brief by 41 Law, Economics, and Business Professors in support of the Petitioner that parallels a similar brief filed in support of the petition for certiorari.  The merits brief, coordinated by Mark Lemley, Timothy Holbrook, and Lynda Oswald, argues that the Court should reject the "deliberate indifference" standard articulated by the Federal Circuit in SEB, and instead hold that inducement require that the defendant "be aware of a patent and encourage an act that it knows or should know would infringe that patent."  In anticipation of an argument that may be made in support of the Respondent, the brief also asserts that a strict liability standard for inducement would be disastrous.  The brief can be directly downloaded here: Download 10-6, tsac, 41 Law, Economics, and Business Professors

The full set of amicus briefs is available on the American Bar Association Website.  It includes briefs from:

  • The Business Software Alliance in Support of Petitioner
  • Cisco Systems, Inc., Dell, Inc., and Intel Corporation in Support of Reversal
  • The Clearinghouse Association and Securities Industry and Financial Markets Association in Support of Petitioner
  • Comcast Corporation, Facebook, Inc., Intuit Inc., Microsoft Corporation, Netflix, Inc., Overstock.Com, Inc., and SAP America, Inc. in Support of Petitioner
  • Google, Inc., in Support of Petitioner
  • NewEgg, Inc., in Support of Petitioner
  • The Software Freedom Law Center in Support of Petitioner
  • Yahoo! Inc., Ebay Inc., Electronic Arts Inc., General Motors LLC, Hewlett Packard Company, McAfee, Inc., Red Hat, Inc., and Symantec Corporation in Support of Petitioner
  • The Federal Circuit Bar Association in Support of Neither Party
  • The Intellectual Property Owners Association in Support of Neither Party

Untouchable: Sham Reexamination Requests

Lockwood v. SHEPPARD MULLIN (Fed. Cir. 2010) (nonprecedential)

Last week, I wrote about the Lockwood case involving allegations that Sheppard Mullin should be held liable for filing a sham reexamination request.  The district court had dismissed Lockwood's complaint — holding that there could be no federal cause of action for filing a sham reexamination request because, inter alia, that area is preempted by Federal Patent Laws. 

The Federal Circuit (Judges Newman, Plager, and Prost) has now decided the appeal — affirming the district court decision without opinion. (Rule 36).  Federal Circuit Rule 36 indicate that a panel may “enter a judgment of affirmance without opinion . . . [if] an opinion would have no precedential value.”  Here, the Rule 36 opinion is surprising given the lack of precedent on this topic, the obvious third-party interest in the outcome of the case, and the dramatic rise in the use of reexaminations over the past decade.

In the appeal, briefs amici were filed by the TPL Group (arguing that “nothing in the reexamination law … indicates that Congress intended to prevent patent holders from [pursuing a state law claim of unlawful business conduct] when a baseless request for reexamination is filed for the purpose of harming a competitor); Professor Hricik (arguing that liability should be available); NDP Managed Security (arguing that the suit is not barred by California law); and O'Melveny & Myers (arguing that the reexamination statute preempts a court action for sham filing of a reexamination).  Raymond Mercado (who previously worked for Lockwood) has written an academic article explaining his findings of extensive “reexamination abuse” by third-party requesters.  Mercado argues that patentee's subject to sham reexamination requests should certainly be able to bring an action under the common law tort of malicious prosecution. In addition, Mercado argues for a new federal cause of action.

This case opens the door to some amount of bad-behaviour in the filing of reexamination requests.  Patent attorneys who file sham-requests  can be sanctioned through the USPTO's Office of Enrollment & Discipline. However, an anonymous third party requester may be untouchable.

–  Dennis 

Guest Post: What Ultimately Matters In Deciding the “Gene Patenting” Issue?

By Jacqueline Wright Bonilla, PhD, JD. Ms. Bonilla is a partner at Foley & Lardner and filed an amicus brief supporting Myriad's position.

In entering the fray of this discussion, I note that I, along with two of my colleagues at Foley & Lardner LLP, submitted an amicus brief in the AMP v. PTO (a/k/a ACLU v. Myriad) "gene patenting" case on behalf of our clients Rosetta Genomics and George Mason University. In addition to our brief, other colleagues at our firm submitted a different amicus brief on behalf of a different client, Alnylam Pharmaceuticals. Both briefs, along with Myriad's brief and a number of other amicus briefs filed last week, support a reversal of the district court opinion as it pertains to "isolated DNA" composition claims. These briefs agree that such claims are patent eligible under current law, and should continue to meet the threshold of 35 U.S.C. § 101 as a matter of policy and social considerations. We are sensitive to dire consequence to biotech innovation in the face of a possible alternative outcome.

As it turns out, however, while such briefs agree on patent eligibility of "isolated DNA" claims, a number of briefs differ in viewpoints regarding applicable law, and even which cases are relevant versus not. As such, a reading of just the briefs filed with the Federal Circuit so far—even without considering the ACLU brief yet to be filed, much less amicus briefs filed in support of the ACLU's position—underscores a point worth mentioning.

The point is this: reasonable minds can differ on an interpretation of what constitutes relevant case law and how it should be interpreted in this case. This point is often missed in the hubbub we see in the press. For instance, many have commented on the amicus brief filed by the Department of Justice last week. Some have accused the DOJ of misreading the law entirely and attempting to eviscerate biotechnology innovation altogether. Such viewpoints misread the point of the DOJ brief, in my opinion.

Look what the DOJ brief actually says. It argues that the district court got it wrong in certain important respects. As stated in the DOJ brief:

… the district court erroneously cast doubt on the patent-eligibility of a broad range of manmade compositions of matter whose value derives from the information encoding capacity of DNA. Such compositions—e.g., cDNAs, vectors, recombinant plasmids, and chimeric proteins, as well as countless industrial products, such as vaccines and genetically modified crops, created with the aid of such molecules—are in every meaningful sense the fruits of human ingenuity and thus qualify as "'human-made inventions'" eligible for patent protection under section 101. [] The district court therefore erred in invalidating the challenged composition claims, such as claim 2 of the '282 patent, that are directed solely to cDNAs.

DOJ brief, pages 9-10 (citations omitted). As part of this discussion, the DOJ likewise agrees with our position that claims directed to recombinant vectors comprising any isolated DNA—even DNA having a sequence exactly as it exists in nature—constitutes patentable subject matter. See DOJ brief, page 16, discussing claim 8 of the '282 patent. Thus, unlike the district court opinion, the DOJ proposal does not throw the entire biotech baby out with the bath water.

That said, it appears that the DOJ may cut off a hand of the biotech baby. It argues that "isolated DNA" comprising a sequence from genomic DNA as it exists in a body does not constitute patentable subject matter. The DOJ brief (pages 10-11) argues that the "chemical structure of native human genes is a product of nature," even "when that structure is 'isolated' from its natural environment."

This position presents a slippery slope of considerable concern to those affiliated with biotech innovators responsible for actually getting medical products to patients. For example, the DOJ sidesteps an important scientific fact: all isolated nucleotide compositions—regardless of sequence—are, in fact, engineered DNA molecules. Such DNA molecules are necessarily, by definition of their existence in an isolated form, "human made" inventions. These products simply do not exist without human intervention. Thus, how does one successfully distinguish what is really "human made"? Moreover, human involvement is needed to identify valuable isolated nucleic acid molecules, such as DNA vaccines, PCR probes, interfering or micro RNA, etc., and then isolate them. When exactly is the human involvement sufficient to meet § 101? An additional slippery slope in the DOJ position is that many non-nucleotide compositions also exist as "products of nature" in a human body or other natural physical state. These compositions include many valuable small molecule pharmaceuticals, proteins, antibodies, just to name a few. Such compositions could likewise be subject to the same legal reasoning propagated in the DOJ brief. In other words, the fallout of the DOJ's position has wide-sweeping implications, even if not as flabbergastingly debilitating as the district court opinion.

This all said, I propose that it does no good to simply assert that the DOJ (or any party or judge for that matter) incorrectly reads relevant case law and/or misunderstands the science wholesale. As mentioned already, reasonable minds can differ on case law interpretation in this case, and how to apply scientific facts to the law. The sheer number of briefs and differences in positions—see DOJ versus USPTO as just one example—indicates this phenomenon in vivid color.

Thus, at the end of the day, the Federal Circuit and/or Supreme Court may ultimately decide the outcome of this case based on policy and social/economic considerations. The courts will consider case law, of course, but in reality may only apply it after the fact. I also believe that any precedential decision issued here, either way, will necessarily have at least some negative fallout. In fact, the patent system itself intends negative fallout to some people by virtue of granting a right to exclude others for a limited time. Thus, keeping the ideals of patent law in mind, it will be critical for courts to choose a course of action that provides the most amount of good, while causing the least amount of collateral damage. In other words, forget all the clever legal mumbo-jumbo—what do we want to happen here for the better collective good?

My understanding of the patent system is that it exists for the very purpose of stimulating innovation, as well as public disclosure of that innovation. As discussed at length in our amicus brief (and by others), abolishing patent eligibility of genetic inventions—not to mention inventions in other areas of health and medicine potentially impacted by a decision here—will have more of a dampening effect on research, development and innovation than any patent right could ever have.

My hope is that courts will remain ever conscious of slippery slopes created by any one interpretation of the law and application of science. No one wins if we inappropriately dampen incentives for innovators to discover, apply and provide innovation to the benefit of humans.


US Government Argues in Court that Isolated Genes are Unpatentable

AMP v. Myriad (Fed. Cir. 2010)

In March, 2010, District Court Judge Robert Sweet held Myriad's gene patent claims invalid for failing to satisfy the subject matter eligibility requirements of 35 U.S.C. 101.  The ruling was directed toward claims that cover particular isolated DNA molecules (genes) and processes of detecting and screening for those genes, but was written broadly enough to essentially invalidate all patents covering genes that were isolated from an organism. 

Last month, I heard a rumor that Obama administration science and legal advisors outside of the USPTO supported Judge Sweet's ruling.  At the time I disregarded that suggestion as unlikely. I was wrong. [Andy Pollack at the NYTimes has the scoop]

The US Department of Justice (DOJ) has now filed an amicus brief supporting the lower court decision — arguing that isolated genes are unpatentable because they improperly claim a product of naturer [Link to Brief]:

The district court correctly held . . . that genomic DNA that has merely been isolated from the human body, without further alteration or manipulation, is not patent-eligible. Unlike the genetically engineered microorganism in Chakrabarty, the unique chain of chemical base pairs that induces a human cell to express a BRCA protein is not a “human-made invention.” Nor is the fact that particular natural mutations in that unique chain increase a woman’s chance of contracting breast or ovarian cancer. Indeed, the relationship between a naturally occurring nucleotide sequence and the molecule it expresses in a human cell — that is, the relationship between genotype and phenotype — is simply a law of nature. The chemical structure of native human genes is a product of nature, and it is no less a product of nature when that structure is “isolated” from its natural environment than are cotton fibers that have been separated from cotton seeds or coal that has been extracted from the earth.

. . . .

Thus, the patent laws embrace gene replacement therapies, engineered biologic drugs, methods of modifying the properties of plants or generating biofuels, and similar advanced applications of biotechnology. Crossing the threshold of section 101, however, requires something more than identifying and isolating what has always existed in nature, no matter how difficult or useful that discovery may be.

. . . .

A product of nature is unpatentable because it is not the inventive work of humankind. That essential rule cannot be circumvented by drafting claims for the same natural product removed from its natural environment and proclaiming the result “pure.”

Several other amici have filed briefs:

Gene Patents on Appeal: ACLU’s Recusal Motion

Association for Molecular Pathology (AMP) and the American Civil Liberties Union (ACLU) v. United States Patent and Trademark Office (USPTO) and Myriad Genetics (Myriad) (Fed. Cir. 2010)

In a May 2010 decision, Judge Sweet of the Southern District of New York issued an opinion that would render most gene patents invalid for failing to claim patentable subject matter under 35 U.S.C. 101.  That high-profile case is now on an appeal, and has the potential of shifting US patent law both by its in-court and out-of-court impact.

Even before filing a substantive brief on the merits, the declaratory judgment plaintiffs (AMP & ACLU) filed a motion asking that Chief Judge Rader recuse himself from potentially hearing the decision. AMP argues that the Chief’s public statements regarding this case “have created an appearance of partiality that calls into question his ability to engage in impartial legal analysis.”

Notably, while attending a BIO meeting, Judge Rader reportedly responded to a comment by Professor Whealan (and former Rader clerk) that there are no real “legal standards for making [a Section 101] decision. . . [U]sing Section 101 to say that the subject matter is unpatentable is so blunt a tool that there is no neutral step to [draw] a line here [between what is and is not patentable].”  In Judge Rader’s construct, the lack of a clear legal standard means that the decision will then be based on “politics. It’s what you believe in your soul, but it isn’t the law.”  In another conference (this time at Fordham Law School), AMP’s attorney Dan Ravicher was speaking and Chief Judge Rader asked Ravicher a question “hinting at disagreement” with Ravicher’s position.  In particular, the Ravicher-Rader colloquy was quoted as follows:

Ravicher (pointing to a bottle of water): "Was that [purification] sufficient intervention between what God gave us … and what man created to merit a patent?"

Chief Judge Rader: "How many people have died of water pollution over the course of human events? Probably billions."

Two responses to the ACLU motion have been filed. 

First, Myriad responded that the cited statements by Chief Judge Rader “do not even suggest how Chief Judge Rader might vote, were he a member of the panel assigned to decide this case.”

The second filing is by the Federal Circuit Bar Association (FCBA) as amicus. The FCBA argues strongly that Judges should be encouraged to participate in educational conferences such as the BIO meeting and Fordham Law School.  The FCBA makes the important point that “Just as it is important that judges recuse themselves when the rules require it, it is equally important that judges refuse to recuse themselves where the rules do not require it.”  Granting recusal on the thin-evidence presented here would have the two primary effects of (1) discouraging sitting Federal Circuit judges from participating in public conversations and (2) encourage more strategic recusal motions.  The FCBA motion was a joint effort by former Deputy Solicitor General Thomas Hungar (Gibson Dunn) and the oft-paired team of Ed Reines & Amber Rovner (Weil Gotshal).

This particular motion may never be decided. Since the panel has not yet been assigned for this appeal, the CAFC has refrained from deciding the motion. In a letter to AMP, the court indicated that “[i]n the event that Judge Rader is assigned, the motion will be transmitted to him.” 


Changing the Law of Inequitable Conduct: Abbot Briefs its Case

TheraSense, Inc. (Abbott Labs.) v. Becton, Dickinson and Co. (Fed. Cir. 2010)(En Banc Rehearing)

In TheraSense v. BD, an en banc Federal Circuit is reconsidering the doctrinal structure that it has created to handle allegations of inequitable conduct. Abbott (the patent holder) has filed its opening merits brief arguing that the current law of inequitable conduct over-extends its proper bounds.  In an eloquent opening statement, Abbott writes:

The question in this case is not whether to reform the doctrine of inequitable conduct, but whether to restore it—to its origins in Supreme Court precedent; to the confines Congress intended in the 1952 Patent Act; to the standards this Court articulated en banc in Kingsdown Medical Consultants v. Hollister, Inc., 863 F.2d 867 (Fed. Cir. 1988); and to the standards that govern in other areas of law. This Court has expanded the inequitable conduct doctrine well beyond those boundaries, and the result has been an “ongoing pandemic” of inequitable conduct charges. Taltech Ltd. v. Esquel Enters. Ltd., 604 F.3d 1324, 1335 (Fed. Cir. 2010) (Gajarsa, J., dissenting). The expansion has rendered valuable patents unenforceable based on minor omissions far afield from the doctrine’s purposes. And it has converted the federal courts into roving commissions to enforce standards of conduct before the PTO without regard to whether the alleged infractions had any impact. . . .

Supreme Court precedent and the legal principles embodied in the Patent Act reserve those extreme consequences for the most egregious circumstances—cases where a party “obtained its patent by fraud.” Walker Process Equip., Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172, 175, 176 (1965). As this Court has recognized, the Supreme Court has held patents unenforceable “only in cases of ‘fraud on the Patent Office.’” Star Scientific, 537 F.3d at 1365-66 (quoting Hazel–Atlas Glass Co. v. Hartford-Empire Co., 322 U.S. 238, 250-51 (1944)); see Larson Mfg. Co. of S.D., Inc. v. Aluminart Prods. Ltd., 559 F.3d 1317, 1343 (Fed. Cir. 2009) (Linn, J., concurring). A party seeking to invalidate a trademark or copyright based on misconduct before the agency must prove it was the product of fraud. The standard should be no less stringent here.

Briefs Filed Thus Far:

PSA For TheraSense Amici: Filing Permission Must Be Requested

The TheraSense en banc order states that “amicus briefs may be filed without leave of court but otherwise must comply with Federal Rule of Appellate Procedure 29 and Federal Circuit Rule 29.”  Although I would have guessed that this statement relieved amicus filers from the requirement of seeking permission of the parties or filing a motion, the Federal Circuit clerk is apparently requiring that amici either (1) obtain consent from all parties, or (2) if fewer than all parties consent, submit a motion to the court for permission to file the brief.  Several amicus briefs filed in the case have apparently been rejected for failure to comply with these requirements.

This information comes from Professor Christian Mammen (visiting at Hastings). Mammen is drafting a brief in TheraSense that argues three primary points: (1) that materiality should focus on patentability issues, and should defer to the PTO's Rule 56; (2) that there should be an increased focus on the clear and convincing standard of proof for intent (with corollaries that "should have known" and "gross negligence" should be abolished, and the Star Scientific "single most reasonable inference" test is a good starting point); and (3) if there is a sufficient increase in the required thresholds for both materiality and intent, the balancing step (which is often ignored in any event) may be abandoned.  Legal academics or others potentially interested joining his brief should contact him at

Patents that Exhibit “Potential Vagueness and Suspect Validity”

In eBay v. MercExchange (2006), the Supreme Court ruled that an adjudged infringer should only suffer permanent injunctive relief once the traditional four-factor test of equity had been satisfied. This general priciple was recently supported by the non-patent Supreme Court case of Monsanto v. Geertson (2010). In Monsanto, the court wrote “An injunction is a drastic and extraordinary remedy, which should not be granted as a matter of a course.” The court’s apparent patent-law-centrist, Justice Kennedy, wrote a concurring opinion suggesting that times-have-changed and that courts may have good reason to frequently deny injunctive relief. With some flair, Justice Kennedy suggested that the “potential vagueness and suspect validity of some … patents may affect the calculus under the four-factor test.”

In many respects, Justice Kennedy’s statement from eBay seems odd. The issue of permanent injunctive relief only arises after trial — after the patents are deemed valid and infringed. The trial is intended to remove any question regarding potential invalidity of the patent rights. However, in a recent amicus brief to the Federal Circuit, Verizon attempts to provide some explanation and some teeth to Kennedy’s proposal. (Justice Kennedy’s statement has been quoted and discussed in over 80 law review articles over the past four years.)

The Verizon brief was filed in the pending en banc case of TiVo v. EchoStar. That case focuses on whether the infringement of new products introduced by an adjudged infringer should be analyzed through contempt proceedings or through a new trial.

Verizon’s brief does not focus on the questions at issue in TiVo, but rather addresses the broader question of whether injunctive relief should be issued in-the-first-place. Expanding on Justice Kennedy’s statements, Verizon argues that — even after a patent is determined valid at trial — the court must consider the possibility that the patent is invalid as part of the injunction analysis:

The need to ensure that equity “mould[s] each decree to the necessities of the particular case,” Hecht, 321 U.S. at 329, requires that a district court take into account the possibility that a patent – issued and adjudged to be valid in the context of an infringement trial – is, in fact, invalid.

To explain its position, Verizon points to a specific (and common) situation — where the infringed patent is pending reexamination at the USPTO. The brief states boldly that “the pendency of a PTO reexamination proceeding weighs strongly against imposition or continuation of an injunction.”


  • Verizon filed its brief early, the first round of briefs are not due until July 26, 2010.
  • Edited to correct an error (I had said that Chief Justice Roberts wrote the eBay majority).



Statutory Guidelines for Inequitable Conduct

In TheraSense, the en banc Federal Circuit is looking to rewrite the rules of inequitable conduct. By both its name and historic precedent, inequitable conduct appears to stem from non-statutory doctrines of equity. However, as with other equitable doctrines (such as injunctive relief), inequitable conduct could be somewhat tamed by the language of the Patent Act. In his TheraSense amicus brief, Professor Hricik is taking a useful approach by focusing on the statutory basis for holding claims unenforceable.

Two provisions of the Patent Act come to mind. One is general and the other specific. The general statute is 35 USC 282(1). That portion of Section 282 identifies "unenforceability" as a defense to patent infringement. In TheraSense, the court's first goal should be to interpret the meaning of unenforceability as found in that statute.

The more specific provision is Section 288. It is Section 288 that allows a patentee to assert infringement of remaining claims even after some of the claims are found invalid. Section 288 sets a specific limit on this separability principle. Namely, separability of claims does not apply when an invalidated claim was obtained through deceptive intent.

Whenever, without deceptive intention, a claim of a patent is invalid, an action may be maintained for the infringement of a claim of the patent which may be valid. 35 U.S.C. §288.

Section 288 is not exhaustive in its approach. Rather, the statute is only explicit that the remaining claims of a patent can be asserted even after one of the claims was found invalid, so long as that invalid claim was not obtained with deceptive intent. The statute does not explicitly indicate the result when an invalid claim was obtained with deceptive intent or, for that matter, when a valid claim was obtained with deceptive intent. In his brief, however, Professor Hricik concludes that these statutes should be read to – at times – limit the Court’s ability to automatically render all claims of a patent unenforceable after a finding of inequitable conduct.

Contact Professor Hricik if you (or your firm / company) are interested in joining the brief.

Guest Post: Why Bilski Benefits Startup Companies


I asked Professor Ted Sichelman to provide his thoughts on how the Bilski decision impacts start-up companies and their incentive to innovate. DC

By Ted Sichelman, University of San Diego School of Law

Before practicing law and becoming a professor, I founded and ran a small software company that sells speech recognition software to taxicab companies. After my company designed its technology, we filed for patents. Later on, when raising financing from angel and venture capital investors, they reviewed our pending applications carefully and considered them a way to stop potential competition. Indeed, in a recent survey of startup firms, the Berkeley Patent Survey—which I conducted with Robert Merges and Pamela Samuelson of UC Berkeley School of Law and Stuart Graham (now Chief Economist at the PTO)—startup executives reported that nearly 70% of venture capital firms and 50% of angel investors said that patents were important to their investment decisions. Relatively broad patentable subject matter assists startups in raising needed funds. As I have argued elsewhere, another reason for broad subject matter is that startups engage in substantial amounts of post-invention—but pre-commercialization—innovation that is not always technological in nature. For instance, many startups generate marketing, financial, legal, and other types of non-technological innovations during the costly commercialization process. Providing IP protection for these innovations not only can produce more of them, but also can help drive technology commercialization.

Assuming the Federal Circuit and the PTO do not go astray in implementing Bilski—which admittedly leaves many doors open to do so—the opinion will allow startups to continue to use patents to garner financing and will, hopefully, set an appropriate balance on the patentability of non-technological inventions. In particular, as I urged in an amicus brief with Professors Mark Lemley, Michael Risch, and Polk Wagner—Bilski rightly adheres to the 150-year old tradition that as long as the claimed invention is a machine, manufacture, composition of matter, or a process, only natural phenomena, laws of nature, and abstract ideas should be excluded from eligible subject matter.

One might contend that by allowing business methods—as well as software and other “intangible” innovations—to be patented, startup firms will encounter a greater “thicket” of patents, making it more difficult for them to enter particular markets. For example, an amicus brief in Bilski filed on behalf of “entrepreneurial and consumer advocates” argued that “if the PTO is permitted to grant broad business and service process patents, small start-up businesses would face an entirely new regime of business regulation – essentially requiring businesses to request private permits to operate from their competitors who have patents, independent of whatever technology the new business uses to compete.” Justice Stevens’ echoed this view by writing in his concurrence that business methods patents “can take a particular toll on small and upstart businesses.”

In actuality, under the Federal Circuit’s previous State Street Bank opinion, in operation for a decade prior to Bilski, the PTO regularly granted “broad business and service process patents” and there is little evidence that these patent-holders required startups to license them in any significant numbers. The Berkeley Patent Survey found that only 8% of the population of respondent software companies and 12% of venture-backed software companies had licensed-in even one patent. In sum total, a relatively low percentage, 0.6% and 3%, respectively, reported licensing a patent solely to avoid a lawsuit. And while Bilski ultimately holds that business methods are not per se unpatentable, the practical effect of the outcome will be to place unapplied business methods into the precluded “abstract idea” category. If implemented properly, such an approach will ensure that startups—and, indeed, larger and more established companies—are not unnecessarily subject to overly broad patents while maintaining robust incentives to innovate.

Ted Sichelman is an Assistant Professor at the University of San Diego School of Law, where he teaches patent law and other intellectual property courses.

Supreme Court Asked to Expand Defenses to Patent Infringement

IGT v. Aristocrat Tech of Australia (on petition for certiorari)

Every year, the PTO revives hundreds of unintentionally abandoned patent applications, and about half of those eventually issue as patents (not counting continuations and other descendants).

In the IGT case, the gaming-manufacturer was sued for allegedly infringing two of Aristrocrat's slot-machine patents. The first patent stemmed from an Australian provisional application that was followed by an international PCT filing. At the national stage in the US, the applicant missed the filing deadline but was able to convince the PTO to revive the application as unintentionally abandoned. The second patent is a continuation from the first.

In court, IGT has argued the revival was improper and thus, that the patents are invalid. IGT reasoned (and the district court agreed) that the revival was improper because the PTO lacked authority to revive national stage applications that were unintentionally filed late. Rather, the statute arguably only allows revival of applications upon proof that the tardiness was unavoidable.

Without determining the proper scope of the PTO's revival authority, the Federal Circuit rejected IGT's argument - holding that improper revival is not a "cognizable defense" to patent infringement and reminding defendants that a patent is not invalid simply because the PTO erred in issuing the patent.

Enumerated Defenses in Litigation: Section 282 of the Patent Act defines the defenses available against charges of patent infringement. These enumerated defenses include:

  1. Noninfringement …,
  2. Invalidity of the patent or any claim in suit on any ground specified in part II of this title as a condition for patentability,
  3. Invalidity of the patent or any claim in suit for failure to comply with any requirement of sections 112 or 251 of this title.
  4. Any other fact or act made a defense by this title.

In its analysis, the Federal Circuit found that improper revival did not fall within any of the four categories of defenses - and thus cannot be raised as a litigation defense. The case implicitly calls into question other traditional defenses such as nonstatutory double patenting, improper inventorship. IGT argues that the decision also implies that a defendant could not challenge a patent based on its expiration due to failure to pay maintenance fees. Of course, a defendant should have some mechanism for challenging an improperly revived patent - either through the courts or a post-grant procedure at the PTO. Under the Federal Circuit's rule, however, a typical defendant would have no recourse. (Two potential avenues could be (1) inequitable conduct in the revival and (2) trigger an interference.)

Leaving the PTO's revival grant's unchallengeable is particularly troublesome because of the serious lack of transparency in the petitions office. Pre-grant revivals are tucked away in individual prosecution file wrappers and cannot be searched in any public database. Thus, the public is left without any check on the system at either the micro or macro level.

Petition for Certiorari: IGT has petitioned the Supreme Court for a writ of certiorari and has garnered the support of the group of usual defendants (Cisco, Dell, Google, Microsoft, etc.) with the simple question:

Whether a patent infringement defendant may assert as a defense the fact that the patent resulted from an abandoned application that was not revived according to the requirements prescribed by Congress.

In several ways, this cases parallels the other recent Supreme Court patent cases such as KSR, eBay, and MedImmune. At least as history tells the story, each of those cases began with a rigid rule created by the Federal Circuit to favor patent holders. In each case, the Supreme Court softened the rule to add flexibility in a way that favors the defendants. In KSR, the rigid TSM test for applying multiple references during obviousness analysis was relaxed. In eBay, the rule strongly favoring injunctive relief was relaxed. And, in MedImmune, the rule setting a reasonable apprehension of a lawsuit as a condition precedent to a declaratory judgment action was also relaxed. In the IGT case at hand, the Supreme Court has the opportunity to tear down another rigid application of the law and open a new avenue for defendants to challenge a patent holder's rights.

Invalidity of the patent or any claim: Although slightly off-topic, I am intrigued by the wording of Section 282, which creates the defense of "invalidity of the patent or any claim." (Emphasis added). Ordinary validity issues focus on individual claims. Is the claim anticipated or obvious? Is the claim definite, fully described, and enabled, and does it properly claim patentable subject matter? The general focus on the validity of claims begs the question of what we mean by "invalidity of the patent." IGT's theory of invalidity based on improper revival is bolstered here because it would breathe meaning into the statutory invalid "patent."

Aristocrat's opposition and any amici in opposition are due April 22.


Related Posts:

Bilski v. Doll: Round I of Amicus Briefs

Bilski v. Doll (on petition for writ of certiorari 2009)

In a 2008 en banc decision, the Federal Circuit affirmed a Patent Office ruling that Bernard Bilski’s claimed method of hedging the risk of bad weather through commodities trading was not patent eligible under Section 101 of the patent act. The Court applied a “machine-or-transformation test” as the only test to be used in determining whether a claimed process is eligible for patenting under § 101. The decision holds that a claimed process either (1) be tied to a particular machine or apparatus or (2) transform a particular article into a different state or thing. Although the Court identified the Bilski test as the only test, it added two corollaries: (1) the addition of a mere field-of-use limitation without other meaningful limits on claim scope will not render a method claim patent eligible; and (2) insignificant extra-solution limitations will not render a method claim patent eligible.

Bilski has petitioned the Supreme Court to hear its appeal and look at the question of patentable subject matter for the first time in a generation. Diamond v. Chakrabarty and Diamond v. Diehr together opened the door for broader patent eligible subject matter. Notably, Justice Stevens – author of the Diehr dissent – is the only justice still on the bench. Bilski’s petition asks two questions:

1.       Whether the Federal Circuit erred by holding that a “process” must be tied to a particular machine or apparatus, or transform a particular article into a different state or thing … despite this Court’s precedent declining to limit the broad statutory grant of patent eligibility for “any” new and useful process beyond excluding patents for “laws of nature, physical phenomena, and abstract ideas.”

2.       Whether the Federal Circuit’s “machine-or-transformation” test for patent eligibility, which effectively forecloses meaningful patent protection to many business methods, contradicts the clear Congressional intent that patents protect “method[s] of doing or conducting business.” 35 U.S.C. § 273.

The first round of Amicus briefs – those supporting the petition – have now been filed. The PTO’s briefs and briefs in opposition to the petition are due in early April.

Amicus Briefs Supporting the Petition (I have not reviewed all of these, but wanted to post them for public consumption):

Obvious to Try? BIO Challenges Ex Parte Kubin

In re Kubin (Fed. Cir. 2008)

Immunex (a subsidiary of Amgen) is hoping to patent its a DNA sequence coding for a NK (Natural Killer) cell regulator protein. The BPAI rejected the “nucleic acid molecule” claim — finding it obvious over the prior art. [BPAI Decision]. This decision is one of only three precedential BPAI decisions in 2007.

Just looking at the claimed sequence, it would not seem obvious — its structure is not overly similar to other regulator proteins, and the unpredictable nature of protein folding makes it virtually impossible to predict whether a particular sequence would code for an appropriate protein.

Despite the structural uniqueness, the BPAI found the claim obvious because it could have been isolated and verified simply by following conventional laboratory techniques — thus, making it obvious to try.

Although the CAFC has previously warned the BPAI away from using “obvious to try” analysis in its 1995 In re Deuel case. There, the appellate court held that obviousness analysis of a structure should focus on the structure itself as compared to prior art structures.

In Kubin, the BPAI rejected Deuel as limited by the Supreme Court’s KSR decision. That case focused on combination claims, but included the stray quote that “the fact that a combination was obvious to try might show that it was obvious under Section 103.”

Here, the BPAI argued, the inventor wanted to isolate the NK Regulator and simply used known methods to do so. “Thus, isolating NAIL cDNA was ‘the product not of innovation but of ordinary skill and common sense.’” (again quoting KSR).

The case is now on appeal at the the CAFC. On June 10, the Biotechnology Industry Organization filed an amicus brief asking the court to cabin in the scope of KSR and hold that its obvious to try dicta does not abrogate the Deuel standard. Briefing is ongoing and a decision is not expected until the end of the year.

  • Download kubin.amicus.pdf
  • The PTO’s Obviousness Guidelines have the following rules for making an obviousness rejection based on the obvious to try reasoning:
    • (1) a finding that at the time of the invention, there had been a recognized problem or need in the art, which may include a design need or market pressure to solve a problem;
    • (2) a finding that there had been a finite number of identified, predictable potential solutions to the recognized need or problem;
    • (3) a finding that one of ordinary skill in the art could have pursued the known potential solutions with a reasonable expectation of success; and
    • (4) whatever additional findings based on the Graham factual inquiries may be necessary, in view of the facts of the case under consideration, to explain a conclusion of obviousness.The BPAI decision is notable for a few reasons, including the following two: (1) It was written by Nancy Linck, former PTO Solicitor, Newman law clerk, & PhD Chemist. Soon after authoring the decision, Linck left the firm to join the Rothwell Figg firm. (2) It is a unanimous opinion.
  • Thanks to Hal Wegner for providing a copy of the brief which his firm filed on behalf of BIO.
  • (more…)