Geek of All Trades

Kimberly Moore nominated to CAFC

Dennis Crouch reports on Patently-O that Prof. Kimberly Moore has been nominated for the vacant seat on the Court of Appeals for the Federal Circuit, the federal appeals court with exclusive jurisdiction over appeals in patent cases (and a few other areas of jurisdiction as well).  If affirmed (and there's no reason to expect she won't be) Ms. Moore would be the second woman to serve on the court, which was established by Congress in 1983.  (The first woman is Judge Pauline Newman, an alum of my alma mater.)

I agree with Dennis Crouch that Prof. Moore is an excellent choice.  She is a professor of patent law and has therefore already given a great deal of thought to the normative issues that the court must consider in its decisions.  In an era in which the CAFC is constantly criticized for cavalier activism in shaping patent law, Prof. Moore will add a thoughtful, considered voice to the court's deliberations.  She knows her stuff.

I worked with Prof. Moore once; at my old firm we engaged her as a patent prosecution expert and she conducted for us a fascinating analysis of certain Patent Office statistics.  I wish I could say more about it, but the case settled before we disclosed any of her analysis and I'd feel more comfortable keeping it confidential.  Still, I'm excited that someone I worked with and respected has received this nomination, and I congratulate Prof. Moore, and look forward to her tenure on the court. 

A licensee's right to sue

The Supreme Court is keeping up with its new trend of taking patent cases, and its most recent grant of certiorari addresses an issue that I thought about a lot in the context of a case I worked on for two years. 

Patently-O reports that the Court has granted cert in Medimmune v. Genentech on the question of whether a patent licensee in good standing can bring a declaratory judgment action challenging the validity of the licensed patent. 

A declaratory judgment action is an action in which a party asks a court to declare its rights with respect to another party.  In a typical suit for damages, a plaintiff asserts that another party has aggrieved it somehow (such as by breaching a contract, committing negligence, or engaging in patent infringement), and asks the court to impose an award of monetary damages in compensation for the injury.  A declaratory judgment action is different because instead of asking for damages, the plaintiff is asking the court merely to issue a statement: that a disputed contract term means "X" and not "Y," for example, or that a patent is invalid or unenforceable. 

The conditions under which a court can hear such a dispute are somewhat limited.  The Constitution prohibits federal courts from hearing merely hypothetical questions; ordinarily, the parties must have an "actual controversy" - a real dispute over a real injury - before the court will hear the issue.  But in some cases, courts have held that a declaratory question is nevertheless ripe for adjudication even though any actual injury has yet to occur.  Such cases can arise in the context of disputes over the meaning of contract terms, for example, where a court may rule that it is unfair to require a party to breach the contract and risk great liability before the court will interpret the contract.  Similarly, in patent law, it has been held that under certain circumstances, when a patent holder accuses another party of infringing the patent, there is a sufficient "actual controversy" such that the accused party can seek a declaration that the patent is invalid to avoid proceeding indefinitely under the Damocles' sword of an infringement suit. 

So what of a patent licensee, who is paying for the right to practice the patented invention, but concludes that the patent might be invalid and wants to challenge it without risking the protections of its license?  It used to be that courts prohibited licensees from challenging the validity of the licensed patent in court, on the theory that taking the license is an implied acknowledgment of validity that estopped a subsequent challenge.  In 1969, though, the Supreme Court rejected this theory in Lear v. Adkins, holding that such estoppel ran contrary to the public's interest in having bad patents identified and declared invalid.  The Court reasoned that the licensee, as a party actually paying real money for the privilege of practicing the claimed invention, had a greater stake in the patent's validity than other members of the public.  Therefore, the Court reasoned, the licensee was in the best position to challenge the patent's validity and should not be estopped from doing so.

In 2004, however, the Federal Circuit (the United States Court of Appeals with exclusive jurisdiction over appeals in patent cases) decided in a case called Gen-Probe v. Vysis that a licensee in good standing cannot bring a declaratory judgment suit challenging the patent.  Such a licensee, the Gen-Probe Court ruled, was protected by the license from suit for patent infringement, and therefore did not meet the constitutional requirements for an actual controversy that I described above.   Later, the Federal Circuit applied Gen-Probe to deny declaratory judgment jurisdiction in the Medimmune case that the Supreme Court is now going to review.  Under these decisions, if a licensee wishes to challenge the licensed patent, it must forfeit the license - and face the prospect of liability for willful infringement if its challenge is unsuccessful.

When the original Gen-Probe result came down, it turned a case I was working on upon its head.  We represented several patent licensees who had taken a license to a patent family years previously.  The original patents in the family expired, and our clients thought their obligations under the license were concluded, when a new patent in the family - a submarine patent - suddenly issued.  We believed the new patent was invalid and unenforceable, and sought a declaratory judgment to that effect.  Both our clients as well as some of the other licensees who had also sued expected to rely on the protection of our licenses in the event our challenges were unsuccessful.  The progress of the Gen-Probe case caused both sides to change strategies a couple of times and left the status of all the licenses very, very murky.  At one point we had petitioned the court to enjoin the patentee from terminating our license.  Later, after Gen-Probe, the patentee tried to retroactively un-terminate our licenses - to deprive us of declaratory judgment jurisdiction - and we had to consider litigating to prevent them from affirming our license when just months before we had tried to prevent the termination!

Gen-Probe ultimately did not have a dispositive effect on our case - the patentee eventually forfeited a substantial portion of its rights under the license, and all the remaining claims settled.  But I think it is very good that the Supreme Court is going to consider the issue of a licensee's right to sue for declaratory judgment.  Lear v. Adkins reflects some very compelling public policy in favor of allowing those most suited and most motivated to challenge bad patents to do so.  Even if Gen-Probe and its progeny are not technically at odds with Lear, their effect is against that policy and should be mitigated.  Patentees argue that allowing licensee declaratory judgment suits to proceed gives an unfair advantage to the licensee, allowing risk-free litigation where the licensee comes out none the worse for wear - still protected by a license - if it loses.  I think this argument is outweighed by the fact that the patentee should not have any right to collect royalties on an invalid or unenforceable patent.   And if the patentee wins a declaratory judgment action, it comes out little the worse for wear (except for litigation expenses, which are a burden on both parties), and with a stronger patent to boot.  Allowing licensee challenges is essential to correct implementation of that fundamental policy.  Inhibiting challenges to bad patents undermines the value of the patent system. 

The seven millionth patent

The United States Patent and Trademark Office has issued U.S. Patent. No. 7,000,000.  The patent, which claims a particular kind of polysaccharide polymer - a synthetic cellulose fiber - issued to the Du Pont chemical company after a six-year pendency.  The abstract states that the polymers have "cotton-like" properties but can be produced in continuous filaments "on a year-round basis" for use in the textile industry. 

This press release from the patent office offers some statistical trivia.  It took 75 years from the inception of the modern patent numbering system - U.S. Patent No. 1 in 1836 - to get to U.S. Patent No. 1,000,000, but only about six years to get from U.S. Patent No. 6,000,000 to U.S. Patent No. 7,000,000. 

No wonder we're so busy.

Undoubtedly many conclusions about the patent system's state of health can be drawn from such statistics.  As always, though, the numbers don't tell the whole story.  Patent reform is clearly needed, but the issues are extremely complex and there are cogent arguments from all sides.  I will try to write more about this in the near future.  For now, I recommend the excellent Patently-O blog as a good place to read about patents and patent law. 

A month on the job

I've been at the new job for a little over a month now.  The new job is, in some ways, not that different from the old job.  I used to be a rising midlevel associate at a 250-lawyer general practice law firm, practicing in the patent litigation group, with a little patent prosecution on the side. I am now a midlevel associate in a 20-lawyer intellectual property law firm, practicing patent litigation, and I expect I will eventually have a little patent prosecution on the side.  So it's not like I've quit the legal profession and become a steamshovel operator.  In the grand scheme, the job is pretty much the same.

There are differences, however, that are small yet apparent almost daily.  Some have nothing to do with the law firms themselves, but only reflect the differences in location - my former job was in a remote corner of the city, by the waterfront, with little in the way of retail civilazation to recommend it.  My new job is nestled next to MIT, within a few blocks of grocery stores, restaurants, a post office, a florist, several bookstores, a Starbucks or three, a large shopping mall, and the best art-house movie theater in greater Boston.  I get to take a little walk every day at lunch, and it's very pleasant even in the crappy weather to clear my head and discover something new.

But that's the location, not the job.  The job is different too.  On the whole my cases are a bit smaller, more manageable, than the epic cases I was involved with at the previous firm.  On some of them there is no one but me, the senior partner, and the paralegal.  This is great for my communication and organizational skills.  At the old firm, I certainly took charge of aspects of a case when it seemed I should, but there were times when I definitely hid behind other attorneys - deferring questions to more senior attorneys rather than learning to trust my own judgment; waiting for someone to ask me to do something I knew needed to be done rather than just doing it. 

Here, there's no hiding.  I have to anticipate more and respond to more, because there's no one else who will pick up the slack if I don't.  There's no waiting for a bigger associate to call me up and ask me to update our disclosures or supplement an interrogatory response.  No one is going to carve out a chunk of documents for me to review or assign me just one of three key depositions to prepare for.  And so, while the cases are smaller, they actually feel bigger, because I have to keep track of more of the threads. 

Another palpable difference is that this firm is still small enough to feel like a small, close, warm, informal business, while my old firm - at more than ten times the size - was run more like the giant corporate shop it was.  I can feel the informalities in aspects of daily life, and on a larger scale too. For example, the firm is working on a buildout plan for some additional office space in our building, and at the monthly all-attorney meeting the plan was discussed - not announced by some management subcommittee as it would have been at my old firm, but actually discussed.  I had been with the firm for three weeks, but my opinion was sought and considered. 

That's not to say that all the differences are necessarily better.  My old firm had a huge, in-house copy center that could handle many of the document-proliferating aspects of litigation.  Here, I am preparing for a deposition in a few days, and I need to consider that my secretary is going to have to spend hours in front of a photocopier preparing all the exhibits. Still, it's been an interesting education to see how different small-firm life can be.  So far, so good.    

My fifteen minutes

This is bizarre.  I've never been the subject of a press release before.

Business method patents before the Supreme Court

The Supreme Court has granted certiorari in another patent case.  This time, the Court (minus new Chief Justice John Roberts, who recused himself) will be hearing Laboratory Corporation of America v. Metabolite Laboratories, in which the Federal Circuit held valid and infringed a claim directed to a medical assay.

The Supreme Court limited its grant of certiorari to the third question presented in the petition, which reads as follows:

Whether a method patent setting forth an indefinite, undescribed, and non-enabling step directing a party simply to "correlat[e]" test results can validly claim a monopoly over a basic scientific relationship used in medical treatment such that any doctor necessarily infringes the patent merely by thinking about the relationship after looking at a test result.

I don't have much experience writing questions for cert petitions, but this question as framed just seems, well, stupid and uninteresting.  Presumably the issue that petitioner wants before the court is drawing the line between patentable methods on the one hand, and mere algorithms or scientific facts on the other.  It is true that business method patents often tread close to this line, and there are probably significant reasons to reconsider the boundaries of patentability with respect to them.  But this question does not seem to get to that issue.  If the claim is "indefinite," as the question presumes, it is invalid.  If it is not enabled, it is also invalid.  Under these circumstances, where the detailed and largely uncontroversial bodies of case law governing claim definiteness and enablement can be brought to bear on the validity of the patent, there is no need for any court, Supreme or otherwise, to reach the deep, difficult questions of the patentability of algorithms and business methods. 

One surmises that the Supreme Court has understood the true nature of the question, and will reframe it with the correct premises:  Presuming the claim is sufficiently definite and adequately enabled, is it nevertheless invalid for being directed to unpatentable subject matter?

O'Connor - not Rehnquist - first pin to fall

I wasn't too worried by Chief Justice Rehnquist's expected retirement.  After all, he's so conservative already that replacing him with a Bush appointee would not change the Court's composition that drastically. 

But then, today, comes the distressing news that Justice Sandra Day O'Connor has submitted her resignation to the President.  Justice O'Connor has been a true centrist on the Court and has been the swing vote - and the elegant author - of many a 5-4 decision over her near quarter-century's service.  The effect of filling her seat with a Bush ideologue is incalculable.  Abortion, the death penalty, the First Amendment - these are just a few of the areas in which an O'Connor vote has been decisive and in which a Bush lackey would likely have voted the other way. 

This is a sad day, a day that marks a new stage in the erosion of so many of the freedoms we cherish.   And it only stands to get worse from here.  John Paul Stevens is doing his best Thurgood Marshall imitation, trying to hand on through the storm of a right-wing president, but it is only a matter of time before he must leave the Court as well.  Ruth Bader Ginsburg has battled health issues of her own.  It's difficult to overstate the terrifying concentration of ideology on a Court that featured the two-headed monster of Scalia and Thomas, Rehnquist or another just like him, and three Bush appointees. 

Up until today, the Court had gone a record 11 years without a change of Justice.  O'Connor's retirement is just the beginning of the new era.  It's going to be a long, scary ride from here.

A little more on Merck

I mentioned the other day that the Supreme Court had handed down a decision in Merck v. Integra.  I also included in that post a link to Dennis Crouch's blog that invoked TypePad's "trackback" feature.  The trackback put a link to my post on Crouch's blog.  As a result I've had a lot of visitors who clicked over from Crouch's blog, and were probably disappointed to find that my post didn't actually say anything about the decision.  So, now that I've had a chance to think about the decision a bit and discuss it with others, I thought I would offer something in the way of subtantive commentary. 

An interesting aspect of the Supreme Court's decision is that it offers an actual test for whether the use of a patented compound is "reasonably related to the development and submission" of information to the FDA - that is, a test for whether a use is protected by the statutory safe harbor of 35 U.S.C. 271(e)(1).  The Court ruled:

The use of patented compounds in preclinical studies is protected under §271(e)(1) as long as there is a reasonable basis for believing that the experiments will produce the types of information that are relevant to an IND or NDA.

Slip op. at 14.  But this test is not without limits.  The Court noted elsewhere in its opinion that

Basic scientific research on a particular compound, performed without the intent to develop a particular drug or a reasonable belief that the compound will cause the sort of physiological effect the researcher intends to induce, is surely not reasonably related to the development and submission of information. to the FDA.

Slip op. at 12.  And,

At least where a drugmaker has a reasonable basis for believing that a patented compound may work, through a particular biological process, to produce a particular physiological effect, and uses the compound in research that, if successful, would be appropriate to include in a submission to the FDA, that use is "reasonably related" to the "development and submission of information under . . . Federal law."

Slip op. at 13-14.  So, the Court enunciates the "reasonable basis for believing" test, but includes an overlay that requires the drugmaker to have a specific theory in mind as to why a particular compound might be a promising drug candidate.  Shotgun or blind-guess early drug discovery research is not going to be exempted. 

Even with that limitation, though, the Court's test is broadly articulated and will exempt a wide range of activities from patent infringement liability.  One lawyer I talked with whose practice includes drafting and prosecuting drug claims for pharmaceutical companies, was troubled by the breadth of the Supreme Court's formulation.  She wondered if the Court's decision would make it easier for competitors to design around her compound claims, because experiments that they do with the compound -while trying to develop a substitute compound for FDA approval - might fall with the Court's articulation of the statutory exemption.

Supreme Court agrees with us

In a unanimous decision, the Supreme Court agreed with the amicus brief that I helped draft in Merck KGaA v. Integra Lifesciences I, Ltd. on behalf of the American Intellectual Property Law Association.  In an opinion by Justice Scalia, the Court ruled that the patent infringement safe harbor is broad, protecting uses of patented inventions reasonably related to the submission of any information to the FDA - including the preclinical animal tests that were apparently excluded by the Federal Circuit's original decision.  Dennis Crouch's excellent patent law blog has more, including a link to the opinion. 

Edited to add:  The trackback link to Dennis Crouch's blog has brought a lot of visitors to GOAT who were probably disappointed that I offered no additional analysis of the case.  So I've added a few thoughts here.  Thanks for stopping by. 

Merck v. Integra

Dennis Crouch's excellent patent law blog has a post summarizing some of the briefs submitted thus far in Merck KGaA v. Integra Lifesciences I, Ltd., the first patent case before the Supreme Court since Festo three years ago.  The brief I helped to write is featured, along with a brief signed by one of my former professors.

The case highlights what can go wrong when the people who write patent laws and decide patent cases do so without becoming educated in how science is actually done in research labs.  The statutory safe harbor may have been intended only to protect studies aimed at approval of generic drugs, but the wording Congress chose reaches a far wider range of drug and medical device research.  To fix that problem, the Federal Circuit applied a test that strains the statutory language and reflects that court's poor understanding of the regulatory process for new drugs.  Now the Supreme Court will interpret the statute, and if Congress is unhappy with the resulting scope of the safe harbor, it can step in and fix the language.  It may be slow, but it does represent the process working as it is supposed to.