By Dennis Crouch
Dawson v. Dawson (Fed. Cir. 2013)
It's a fairly rare case where you sue yourself – especially when that occurs after your death. Dr. Chandler Dawson, now deceased, was a leading eye specialist and is the named inventor of the patent applications at suit in this case. While an employee at UCSF, Dawson began working on a topical azithromycin treatment for trachoma – some of Dawson's notes from UCSF include a statement that 0.5% solution might help overcome low-solubility problems. During the process Dawson sought help from folks at InSite Vision to actually make and test the treatment. And, very quickly, Dawson left UCSF and joined InSite. Later, InSite filed two patent applications naming Dawson as a co-inventor for the use of 0.1 to 1% azythromicin to treat the eye. The InSite applications were filed in 1999 and issued in 2001 and 2003 respectively. In 2007, UCSF filed two applications in Dawson's name (without Dawson's cooperation) claiming priority back to the 1999 (InSite) application date. The PTO then declared two interferences. There is a fairly substantial amount of money at stake because the patents are listed in the Orange Book as covering ophthalmic drops known as AzaSite. An infringement lawsuit is pending between InSite and Sandoz. See InSite Vision Inc. v. Sandoz, Inc., Civil Action 17 3:11-cv-03080-MLC-LHG (Complaint filed: 26 May 2011).
So, this case is largely a battle over patent ownership and that ownership depends upon whether Dawson's conception of the invention occurred early (while an employee at UCSF) or later (while an employee at InSite). The doctrine of conception has remained fairly steady for the past 120+ years requires proof of the "formation in the mind of the inventor, of a definite and permanent idea of the complete and operative invention, as it is hereafter to be applied in practice." Hybritech Inc. v. Monoclonal Antibodies, Inc., 802 F.2d 1367 (Fed. Cir. 1986) (quoting Robinson on Patents (1890)).
UCSF as Junior Party: In interference cases (and in future derivation cases) the most important factor is often designation of the "senior" and "junior" parties. Normally, the Senior Party is the party with the earliest effective filing date and the interference (derivation) begins with a presumption that the senior party wins unless unseated by the junior party. Here, we have a filing-date tie because applicants claim priority to the 1999 application date. However, the PTO has a longstanding practice of breaking that tie by saying that the junior party is the one with the latest filing date for its involved application. The UCSF actual application was not filed until 2007 and is thus the junior party.
In the interference, the PTO Board concluded that UCSF had failed to prove Dawson's conception while at UCSF. In particular, the Board held that Dawson "did not fully appreciate how [his] idea was to be implemented in actual practice. . . . What emerges from the facts of this case is that [while at UCSF] inventor Dawson had a general idea for a future research plan to come up with a composition for topical azithromycin to be applied to the eye to treat infection."
On appeal, a divided Federal Circuit has affirmed – holding that substantial evidence supports the Board's conclusion that the invention claimed was not conceived by Dawson as of that early date. The court did suggest that Dawson's lack of testimony in favor of UCSF was a critical factor in its decision.
No Patent Rights to Pre-Conception Innovations: An important take-away from the decision is that the prior employer has no patent rights associated with ideas and innovations that fail to rise to the level of inventive conception. Although this could likely be cured through particular contract language regarding ownership of further developments stemming from work began at the prior employer. This case puts power in the hands of entrepreneurial employees who are not bound by strong contractual limitations on their post-employment activities or patenting.
Writing in dissent, Judge Reyna argued that Dawson's conception occurred while at UCSF. In particular, Reyna walked through the evidence showing that Dawson had conceived of the a process for applying an effective amount of azithromycin to an eye to treat infection in a way that fit the interference count.
Inventorship is perhaps the most fundamental question in patent law. The instant an inventor conceives her invention is the moment in which vests her right to a patent, thus perfecting her constitutional right to exclude. . . .
The majority discounts Dr. Dawson's work at UCSF as failing to achieve a fully developed idea of the invention. This conclusion reflects a misapplication of the law of conception to the facts of this case. To demonstrate conception, the law does not require that Dr. Dawson develop a working physical embodiment of his innovative idea. Indeed,
Invention is not the work of the hands, but of the brain. The man that first conceived the complete idea by representing it on paper, or by clear and undisputed oral explanation, is the first inventor, and to avail himself of the rights or priority the law only requires that he shall use due diligence in embodying his idea in a practical working machine. The sketch need not be a "working drawing." The conception may be complete, while further investigation, and perhaps experiment, may be necessary in order to embody the idea in a useful physical form.
Edison v. Foote, 1871 C.D. 80 (Comm'r Pat. 1871). While conception thus requires "the formation, in the mind of the inventor, of a definite and permanent idea of the complete and operative invention," Mergenthaler v. Scudder, 11 App. D.C. 264 (D.C. Cir. 1897), it does not require reduction to practice. The point of time at which an invention merits protection under the patent law is neither when the first thought occurs, nor when a practical working embodiment is completed. Rather, conception occurs
when the 'embryo' has taken some definite form in mind and seeks deliverance, and when this is evidenced by such description or illustration as to demonstrate its completeness. It may still need much patience and mechanical skill, and perhaps a long series of experiments, to give the conception birth in a useful, working form. The true date of invention is at the point where the work of the inventor ceases and the work of the mechanic begins.
Cameron & Everett v. Brick, 1871 C.D. 89 (Comm'r Pat. 1871). Here, Dr. Dawson's WHO presentation manifested an inventive embryo which thereafter sought deliverance. In his presentation, he provided a description sufficient to illustrate the completeness of his invention. All that was left was the work of the mechanic—that is, reduction to practice. This Dr. Dawson was not required to do.
Responding to the dissent, the majority suggested that the outcome turns on the standard of review since the Board's factual determinations are affirmed based upon the very low standard of substantial evidence. See In re Gartside, 203 F.3d 1305, 1311-15 (Fed. Cir. 2000). The appellate panel does not deal with the reality that conception is a question of law presumably reviewed de novo on appeal other than its fully unsatisfying statement that "UCSF failed to meet its burden of proof as to the legal issue of conception." I ask the court – What is the burden of proof for questions of law?