SCOTUS Passes on Reviewing Patent Eligibility
Bucking the solicitor general's and Federal Circuit's urging, the U.S. Supreme Court won't take medical diagnostics case—or two other Section 101 cases where it had sought the SG's views, which means Congress is now more likely to get involved.
January 13, 2020 at 12:58 PM
7 minute read
After dipping a toe back in the patent eligibility waters, the U.S. Supreme Court has decided against diving all the way back in.
The justices denied certiorari Monday in two cases in which the court had sought the views of the solicitor general, HP v. Berkheimer and Hikma Pharmaceuticals USA v. Vanda Pharmaceuticals. Either case could have forced the court to reconsider a quartet of Section 101 cases that have tilted the law of patent eligibility away from patent owners and more toward accused infringers.
Solicitor General Noel Francisco had recommended against taking each case but had strongly urged the court to reconsider its eligibility law generally, and to use Athena Diagnostics v. Mayo Collaborative Services as the vehicle. All 12 active members of the U.S. Court of Appeals for the Federal Circuit had likewise called on the court to use Athena to clarify the law of eligibility as it applies to diagnostics. But the court rejected Athena as well.
The upshot is that no changes are now likely to the court's Section 101 case law for the foreseeable future, shifting the spotlight back to Congress, which held hearings on the issue last spring and summer.
"I think they are done with this," said Stanford University law professor and Durie Tangri co-founder Mark Lemley. "It's hard to imagine a better case than one where all 12 Federal Circuit judges and the DOJ urge them to take it."
"I do think this will spark renewed movement in Congress," Lemley added. "But it also means the Federal Circuit has very little constraint on what it can do, even when it effectively underrules a Supreme Court decision (as they did in Hikma v Vanda). So we may see more en banc activity and more inconsistent panel decisions in the meantime."
The court could also be waiting on further development of the law before taking any more action, said Villanova University law professor Michael Risch said.
"As more patents are filed post-Alice, we may see a reshaping of patent claiming that eliminates the need for further case," Risch said.
Meanwhile, in other Supreme Court patent news, the court also denied certiorari in Regents of the University of Minnesota v. LSI, in which more than a dozen states and hundreds of universities were demanding the restoration of their sovereign immunity from administrative patent validity challenges at the U.S. Patent and Trademark Office. The universities had argued the America Invents Act trials that are conducted before the Patent Trial and Appeal Board are similar enough to civil litigation that their immunity should apply. The Federal Circuit had disagreed.
As for eligibility, the Supreme Court overhauled it beginning with Bilski v. Kappos in 2010 and ending with Alice v. CLS Bank in 2014. The high court clarified its view that abstract ideas, laws of nature and natural phenomena are not eligible for patenting.
The U.S. Senate Judiciary's IP Subcommittee convened a series of hearings on the subject last year and released a draft framework of legislation that would overrule the Supreme Court's decisions. But the framework was met with criticism, and no formal legislation has yet been introduced.
The USPTO issued new guidance on Section 101 for patent examiners that emphasized that abstract ideas or natural phenomena that are integrated into a practical application can pass muster. But the USPTO guidelines are not binding on courts.
The U.S. Court of Appeals for the Federal Circuit, which has the last word on patent law short of the Supreme Court, has struggled to apply the high court's precedents on a consistent basis, with one judge accusing his colleagues last year of waging "guerrilla warfare" against the Alice decision.
Nowhere was the appellate court's frustration more evident than in Athena Diagnostics. In a 7-5 vote denying en banc review, all 12 active members of the court called on the Supreme Court or Congress to revisit patent eligibility as it's applied to medical diagnostics.
Athena's counsel of record, Wilmer Cutler Pickering Hale and Dorr partner Seth Waxman, called it "an unprecedented cry for help" in his petition for certiorari. "This Court should heed that cry and provide much-needed guidance on the proper application of the judicially-created exceptions to Section 101 of the Patent Act," he wrote.
The Pharmaceutical Research and Manufacturers of America, the Biotechnology Innovation Association and the Intellectual Property Owners Association were among the amici curiae supporting certiorari.
Mayo was represented by Fish & Richardson, which argued that the court correctly decided this issue just seven years ago in Mayo Collaborative Services v. Prometheus Labs, the second in the Supreme Court's quartet of decisions. It endorsed "a bright-line prohibition" against patenting laws of nature, argued Fish partner Jonathan Singer, who was counsel of record to Mayo.
At issue in Athena was U.S. Patent 7,267,820 held by Oxford University and the Max Planck Society and licensed to Quest Diagnostics Inc. subsidiary Athena Diagnostics Inc. The inventors discovered that antibodies to a protein called muscle-specific tyrosine kinase (MuSK) are correlated with neurological disorders such as myasthenia gravis. The Mayo Clinic developed a competing test that Athena accuses of infringing.
The court had asked for the solicitor general's views on Hikma and Berkheimer. The SG recommended against taking both but stressed that that it was time for the Supreme Court to revisit Section 101 in an appropriate case.
"As the government's brief dramatically illustrates, there is a raging debate over the scope and wisdom of this Court's unanimous decision just seven years ago in Mayo Collaborative Services v. Prometheus Laboratories, Inc.," Hikma's attorneys at Winston & Strawn and Wilson Sonsini Goodrich & Rosati argued in a Dec. 20 response to the solicitor general's brief.
Hikma addresses the patentability of methods of treating disease, such as new dosing regimes for existing drugs. The U.S. Court of Appeals for the Federal Circuit ruled 2-1 that Vanda's patent on a method of treating schizophrenia, by determining a patient's particular genotype and adjusting dosage of iloperidone accordingly, is eligible for patenting. Vanda's successful opposition was led by counsel of record Nicholas Groombridge, who is a partner at Paul, Weiss, Rifkind, Wharton & Garrison.
HP v. Berkheimer involves a computer-implemented invention. The question is whether the second step in the Supreme Court's patent eligibility framework—determining whether a skilled artisan would have considered claimed processes routine and conventional at the time of the patent—is a question of law or fact. The Federal Circuit held the latter in 2018, making it more difficult for accused infringers to get patent suits dismissed early on the pleadings.
HP was represented by Morgan, Lewis & Bockius and Gibson, Dunn & Crutcher. Morgan Lewis Washington partner David Salmons was counsel of record. The Electronic Frontier Foundation, Computer & Communications Industry Association, Engine Advocacy and finance-industry supported Askeladden were among those urging the court to grant cert.
Jenner & Block partner Adam Unikowsky led the successful opposition, with help from Much Shelist and Skiermont Derby.
Villanova's Risch said that, although the court took no cases, it may have, in a sense, been striking a compromise. By leaving in Berkheimer in place, patent owners gain some procedural protections. The court leaves the substantive law in place, perhaps because it continues to believe medical diagnostic tests should not be patent eligible, he said.
"This result makes sense to me in the end," said George Washington University law professor Dmitry Karshtedt. "If I'm on the Supreme Court and not steeped in the turmoil with 101, these three opinions are just examples of case-by-case development of the doctrine that was sent down in Mayo [v. Prometheus] and Alice.
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