The Supreme Court today released its decision in the Association for Molecular Pathology, et al. v. Myriad Genetics, Inc. patent case.   The court unanimously held that"a naturally occurring DNA segment is a product of nature and not patent eligible merely because it has been isolated, but cDNA is patent eligible because it is not naturally occurring.  Accordingly, the Federal Circuit'sMyriad holding was affirmed-in-part and reversed-in-part. According to the Court, finding the location of the BRCA1 and BRCA2 genes did not render the genes patent eligible “new . . . composition[s] of matter,” under §101.  cDNA, on the other hand, was found to be patent eligible because it is an exons-only molecule, which according to the Court is not naturally occurring. Stay tuned for an in-depth analysis of the Myriad holding here at the Higher Education IP Law Report.

The Supreme Court today released a unanimous decision in the Association for Molecular Pathology, et al. v. Myriad Genetics, Inc. patent case regarding the human BRCA1 and BRCA2 genes associated with breast cancer, holding that while a naturally occurring DNA segment is a product of nature and therefore not patent eligible, synthetic molecules called “cDNA” are patent eligible because they are not naturally occurring. Background A group of physicians, patients and researchers challenged the Myriad patents in the Southern District of New York, seeking a declaration that certain claims of the patents are invalid under 35 U. S. C. §101.  The Court granted summary judg­ment to the petitioners on the claims at issue, holding that the claims were directed to products of nature and where therefore invalid. In 2012, the Federal Circuit – on remand from the Supreme Court in light of in light of Mayo Collaborative Services v. Prometheus Laboratories, Inc. – reversed the district court and held that both isolated DNA and cDNA are indeed patent eligible under §101.  The Supreme Court granted certiorari and oral argument was held on April 15, 2013. Isolated DNA Sequences Are Not Patent-Eligible Subject Matter In holding that the mere isolation of naturally occurring DNA sequences does not result in patent eligible subject matter under §101, the Court noted that “Myriad did not create or alter any of the genetic information encoded in the BRCA1 and BRCA2 genes,” and that “[t]he location and order of the nucleotides existed in nature before Myriad found them.”  Although Myriad’s discoveries may have been “[g]roundbreaking, innovative, or even brilliant,” this was not sufficient to satisfy the §101 inquiry.  According to the Court, merely identifying the BRCA1 and BRCA2 genes and isolating them from the “surrounding genetic material” was not an act of invention. Indeed, the issue of whether isolating DNA from a chromosome renders the isolated sequence patent eligible was largely dismissed despite comprising a substantial portion of the Federal Circuit’s decision.  These claims are not expressed in terms of chemical composition, the Court reasoned, and do not rely on any chemi­cal changes that may result from the isolation of a particular section of DNA.  Instead, the claims focus on the genetic information encoded in the DNA. Synthetic cDNA Sequences Are Patent-Eligible In contrast to isolated DNA sequences, the Court held that cDNA sequences are patent eligible because the “creation of a cDNA sequence from mRNA results in an exons-only molecule that is not natu­rally occurring.”  Although the petitioners argued that the sequence of cDNA is dictated by nature rather than by a scientist, the Court rejected that argument and reasoned that “the lab technician unquestionably creates something new when cDNA is made.” The Court did highlight at least one situation where cDNA may in fact be naturally occurring and therefore not patent eligible: when a very short DNA sequence may have no intervening introns to remove when creating cDNA, in which case “a short strand of cDNA may be indistinguishable from natural DNA.” Myriad Does Not Implicate Method or Application Claims, or Modified DNA Sequences The Court carefully noted that this decision does not implicate method claims, although the Court did echo its recent decision in Mayo.  While Myriad might have sought a method patent directed to some “innovative method of manipulating genes” if it had created such a method, the Court noted that the processes used by Myriad to isolate the BRCA1 and BRCA2 genes were “well understood, widely used, and fairly uniform” and were not at issue in this case. Similarly, the decision does not implicate claims directed to applications of knowledge about the BRCA1 and BRCA2 genes.  Indeed, many of the unchallenged claims in the Myriad patents are directed to such applications. Further, the decision does not consider the patentability of modified DNA sequences, since “[s]cientific alteration of the genetic code presents a different inquiry.” Conclusions Although the Court’s decision may seem far-reaching, the ultimate impact may be limited. Indeed, one recent study found that there are relatively few patents directed to naturally occurring human gene sequences.  As a result, it may only be Myriad and a limited number of similar patentees that feel the impact of the Court’s holding. In light of Myriad, patent portfolio strategies should focus on applications of knowledge about identified DNA sequences rather than on the DNA sequences themselves.  This strategy will steer clear of Myriad while providing valuable patent protection for uses of the discovery.

The U.S. District Court for the Northern District of New York recently became the latest court to enact local patent rules.  Effective as of January 1, 2012, the new local patent rules apply to all new patent cases filed in, transferred to, or removed to the court on or after that date.  For all patent cases pending on that date, the court will confer with the parties and apply the rules as the court “deems practicable.” The new rules were developed by an ad hoc committee impaneled by Magistrate Judge David E. Peebles.  In addition to J. Peebles, the committee featured local patent practitioners and included George McGuire, chairman of Bond’s intellectual property practice group. Among the more salient points in the new rules is the speed in which the court brings the case from filing through to claim construction.  As is discussed in greater detail below, the rules propose a schedule that rivals those found in other patent forums. Other significant aspects of the new local patent rules are highlighted below.

1. Arduous Contentions: rules call for substantial mandatory production of contentions, documents, and information early in the case

The NDNY rules call for a swift progression of the case following its commencement.  For example, the patent claimant’s Infringement Contentions are due within 14 days after the Rule 16 conference, which means that the patentee will make their infringement contentions without the benefit of discovery from the accused infringer, unless a later date for infringement contentions is stipulated to or ordered. The NDNY rules also provide for mandatory disclosure of documents and information early in the proceedings.  Accordingly, both the patent claimant’s contentions and the accused infringer’s contentions are accompanied by substantial document production. Infringement Contentions Under L. Pat. R. 3.1, the patent claimant provides Infringement Contentions for the asserted claims just 14 days after the Rule 16 conference.  As is standard in most districts with local patent rules, the NDNY rules require a chart identifying specifically where each limitation of each asserted claim is found within each Accused Instrumentality.  Interestingly, the Infringement Contentions must also include a claim-by-claim analysis of the applicable priority date if the patent claims priority to an earlier application, as well as a description of the role of each party if direct infringement is based on joint acts of multiple parties. The NDNY rules also require the production of the following documents with the patentee’s Infringement Contentions, including: (1) all documents evidencing disclosure, sale, or public use of the claimed invention prior to the application for the patent(s)-in-suit; (2) all documents evidencing the conception, reduction to practice, design, and development of each claimed invention; (3) a copy of the file history for each patent-in-suit; and (4) all documents evidencing ownership and maintenance of the patent rights by the party asserting patent infringement. Non-Infringement, Invalidity and Unenforceability Contentions One month after receiving the Infringement Contentions, the accused infringer must provide Non-Infringement, Invalidity and Unenforceability Contentions.  Included with these contentions are two charts that have become standard in many districts, including one demonstrating whether each element of the asserted claims is present in the Accused Instrumentality, and a denial with explanation if it is not, and another identifying where specifically in each item of prior art each limitation or view of each asserted claim is found. Unlike many other districts, however, L. Pat. R. 3.3(c) calls for the accused infringer to set forth in detail each ground that it will use to assert that the patent(s)-in-suit is unenforceable.  For inequitable conduct claims, the accused infringer must: (1) describe each omission or misrepresentation made to the PTO; and (2) state all grounds on which it plans to argue at trial that those prosecuting the patent intended to deceive the PTO.  This includes the identification of any prior art references not disclosed to the PTO during the prosecution of the patent(s)-in-suit, any facts suggesting that one or more persons substantially involved in the prosecution of the patent(s)-in-suit, were aware of such prior art reference prior to the issuance of the patent in suit, and any facts relevant to the element of intent to deceive.  Although the unenforceability contentions are subject to amendment in the event of later discovered facts, the rules set forth a substantial initial burden on the accused infringer considering unenforceability allegations. The accused infringer must also supply certain documents when providing Non-Infringement, Invalidity and Unenforceability Contentions.  Among the documents that must be provided are: (1) source code, specifications, schematics, flow charts, artwork, drawings, photographs, video or other images from every available view or other documentation sufficient to show the operation, composition, design, or structure of any aspects or elements of the accused instrumentality identified by the patent claimant; and (2) a copy of any prior art that doesn’t appear in the file history of the patent-in-suit.

2. Prioritized and Limited Claim Construction: the parties must prioritize the disputed terms, which can number no more than ten

Similar to the local patent rules for the Northern District of Illinois, for example, the parties may only present a total of ten patent terms or phrases to the court for construction.  Exceptions can be made in cases where multiple non-related patents are asserted.  If the parties are unable to agree on ten terms or phrases, the plaintiff(s) can elect five and the defendant(s) can elect five. After exchanging lists of disputed terms, the parties have three weeks to exchange preliminary proposed constructions in which they not only construe the claim terms, but also identify all intrinsic evidence found in the specification and the prosecution history and produce copies of any extrinsic evidence. The parties then create a Joint Claim Construction and Prehearing Statement which is largely similar to the preliminary proposed constructions.  Interestingly, however, the Joint Claim Construction includes a prioritization of the disputed terms.  The prioritization is based on the claim terms’ “significance to the resolution of the case and the court’s construction of those terms and whether they will be case or claim dispositive or substantially conducive to promoting settlement, together with a statement of the significance of each term to the claims and defenses in the case.” This rule forces patent claimants and accused infringers to work together to create a prioritized list of claim terms.  Although the requirement for a statement regarding the significance of each term to the party’s claims or defenses may disclose a party’s strategy, parties typically have a strong grasp of their opponents’ claim construction strategy by the time a Joint Claim Construction chart is created.

3. Deadlines for Discovery: the rules include automatic close of both claim construction and fact discovery

Within thirty days of the Joint Claim Construction and Prehearing Statement, the parties must complete all discovery relating to claim construction, including any depositions with respect to claim construction of any fact and expert witnesses previously identified.  Further, all fact discovery in the case – including expert depositions – must be completed within 120 days after the court issues its claim construction ruling.

4. Speedy Docket: schedule leads to full Markman briefing within 10 months

Under the new rules, the case is scheduled to be fully briefed for a claim construction hearing within about 10 and a half months after filing the complaint.  For comparison, the local patent rules for the Northern District of Illinois call for full claim construction briefing within about 12 months after filing the complaint.

5. Confidentiality by Default: a protective order is entered by the court if the parties are unable to agree on one

At least two weeks prior to the initial Rule 16 conference, the parties may submit a stipulated protective order pursuant to Fed. R. Civ. P. 26(c).  If the parties are unable to agree on a protective order they may each submit a counter proposed protective order that highlights any areas of disagreement.  If no one requests a confidentiality order at or prior to the Rule 16 scheduling conference, the court will itself enter a protective order. Conclusion The adoption of patent rules in the Northern District of New York reflects the court’s interest in patent cases and will likely be a strong consideration for parties looking for swift and timely resolution of patent disputes.

On March 20, 2012, a unanimous Supreme Court held that patents claiming methods for refining the dosage of drugs used to treat autoimmune diseases were directed to laws of nature and therefore not eligible for patent protection. Mayo Collaborative Servs. v. Prometheus Labs. (pdf), No. 2010-1150 (March 20, 2012). This is a signficant decision that is expected to have important implications in the medical and biotechnology industries. The Prometheus Patents The two patents at issue (6,355,623 and 6,680,302) were directed to an application of the correlation between the concentration of metabolites (byproducts created when the body breaks down a drug) and the toxicity and efficacy of that drug. If the concentration of byproducts in the bloodstream of a patient is too low, the current dosage of the drug may not be effective; if the concentration is too high, the dosage might be toxic. The claims of the patents involve two steps: (i) an “administering” step in which the drug is given to patients suffering from an autoimmune disease; and (ii) a “determining” step in which the concentration of the metabolites in the patient are determined. The patient’s metabolite concentration is then compared to claimed ranges, and the physician can increase or decrease the amount of drug given to the patient depending on the comparison. The Supreme Court’s Decision In its decision, the Supreme Court held that the claimed methods were directed to laws of nature. Specifically, the claims recited the natural and pre-existing relationship between the concentration of metabolites in the blood and the likelihood that the dosage of the drug that resulted in that concentration would be ineffective or harmful. This relationship, the Court commented, is purely a consequence of the natural processes by which the human body metabolizes the drug. With respect to the patents at issue, the Supreme Court viewed the “administering” step as simply referring to the relevant audience – doctors who treat patients with the drug. Similarly, the “determining” step simply tells the doctor to engage in conventional and routine activity that doctors had been doing long before the patent. Lastly, the “wherein” clauses only inform the doctor about the relevant natural laws and how to apply them when making a decision about drug dosage. “Well-Understood, Routine, Conventional Activity” According to the Supreme Court, “the steps in the claimed processes (apart from the natural laws themselves) involve well-understood, routine, conventional activity previously engaged in by researchers in the field.” “To put the matter more succinctly, the claims inform a relevant audience about certain laws of nature; any additional steps consist of well understood, routine, conventional activity already engaged in by the scientific community; and those steps, when viewed as a whole, add nothing significant beyond the sum of their parts taken separately.” The Supreme Court explained that a law of nature will typically not be patent-eligible if elements already well-known in the art are simply applied to that law of nature. Instead, the application of elements to the law of nature must involve an “inventive concept” which is not conventional or obvious. Accordingly, Prometheus could not transform a law of nature into patent-eligible subject matter simply by adding the well-known and routine step of measuring metabolite levels in a patient. Justice Stephen Breyer, who authored the decision, summarized the Court’s analysis as follows:

If a law of nature is not patentable, then neither is a process reciting a law of nature, unless that process has additional features that provide practical assurance that the process is more than a drafting effort designed to monopolize the law of nature itself.

In other words, the Supreme Court appears to be saying “don’t dress a law of nature in sheep’s clothing” – such as claiming it with well-known elements or as part of a prior art process – and expect it to be patent eligible. A patent eligible claim must include more than than a general instruction to “apply a law of nature” – it must include activity that transforms a process “into an inventive application of the formula.” However, the Supreme Court’s decision does not provide clear guidance as to what types of activities will “transform” a process into an inventive concept that goes beyond a law of nature.

Case:  CARNEGIE MELLON UNIVERSITY v. MARVELL TECHNOLOGY GROUP (W.D.Pa. 9-28-2011) What happened: Carnegie Mellon University tech transfer office circulated an invention disclosure relating to disc drives. The tech transfer office was informed that a different inventor from Seagate had previous worked on a similar technology, but the Seagate inventor stated that, “[The Carnegie Mellon professors’] invention is related, but goes beyond my work and is probably more interesting." It is unclear whether the tech transfer office knew that Seagate had already filed a patent application on the earlier work of its inventor. Perhaps not surprisingly given the encouragement of the Seagate inventor, Carnegie Mellon filed patent applications on the work of its inventors. In the fullness of time, Seagate got a patent for its early work and Carnegie Mellon got two patents for its later developments and refinements. Carnegie Mellon proceeded to sue Marvell for patent infringement. Marvell is defended based on the theory that many of the claims of the Carnegie Mellon patents were anticipated by the prior art Seagate patent. Decision: No summary judgment of invalidity because the claims of the Carnegie Mellon patents had certain limitations not disclosed in the Seagate patent. Comment: It does not appear that the Seagate work was cited to the U.S. Patent Office during examination of the Carnegie Mellon patents. If the Seagate work was not cited, then this may have been due to the fact that the Seagate application was not published (this was back in the 1990’s) and further because the Seagate patent had not yet issued (it would not issue until several years after the initial Carnegie Mellon application was issued). It is not clear how much the Carnegie Mellon tech transfer office even knew about the specifics of the earlier Seagate work when they were prosecuting the Carnegie Mellon patent applications. It is difficult to say whether Carnegie Mellon would have been in a better or worse position if the tech transfer office had investigated the early Seagate work as soon as they found out about it, and had explicitly dealt with the early Seagate work in the text of the Carnegie Mellon patent applications themselves. Importantly, the district court opinion does not suggest there was any duty to investigate the early Seagate work on the part of the Carnegie Mellon tech transfer office. From a practical perspective, things seem to be going well for Carnegie Mellon on these patents at least at this point.

Article: At the Chronicle Of Higher Education website, Alex Campbell reports that UNC has put in place measures to prevent and minimize unauthorized file sharing by students. Specifically, computers that have file sharing software will not be allowed to connect to the campus network unless and until that student/computer is awarded a “hall pass.” This hall pass involves a student pledge to report illegal file sharing, and apparently some education on copyright law. Interesting Quote:

The university has already seen a big drop in the number of dorm computers that use file-sharing software, from about 1,000 last year to about 50 this year. Of those 50, about half have opted for the hall pass. The other half remain quarantined and unable to access the network, officials say.

Case: Nuvo Research Inc. v. McGrath (filed August 15, 2011, N.D. Cal.) What allegedly happened: In a complaint filed on August 15, 2011 in the Northern District of California court, Nuvo Research Inc. alleges that a UCSF professor, who had worked as a consultant for Nuvo, applied for a patent on an ALS (sometimes called Lou Gehrig’s Disease) drug that others at Nuvo invented. The university was not sued. The professor is currently performing clinical trials on the drug with ALS patients in conjunction with his own company. Comment: There seems to be some concern that this law suit could slow or stop the clinical trials of the ALS drug.

On September 8, 2011, six higher education related institutions released a joint statement endorsing the Leahy-Smith America Invents Act as passed by the Senate. The six institutions are the Association of American Universities, the American Council on Education, the Association of American Medical Colleges, Association of Public and Land-Grant Universities, the Association of University Technology Managers Council on Governmental Relations. The statement is up at the American Council on Education website. Interesting quote:

We appreciate that the concerns of universities and medical colleges were addressed in ways that ensure our institutions’ ability to carry out their public missions. These institutions are the nation’s principal source of the basic research that expands the frontiers of knowledge. The patent system plays a pivotal role in helping them transfer the discoveries made in their laboratories to the commercial sector for development into products and processes that benefit society. The associations’ position on patent reform closely followed recommendations by academic and industry leaders convened by the National Academies in 2004.