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« AMP v. USPTO -- Briefing Update | Main | Amicus Briefs in AMP v. USPTO: Alynylam Pharmaceuticals, Inc. »

December 14, 2010

Comments

Any correlation with the distinction between method claims and the other classes when it comes to importation?

Are there any claims that would prevent a patient, whose BRCAnalysis test results identified a specific point mutation, from seeking to confirm the specific point mutations from a secondary laboratory?

If the answer is no, the "second opinion" argument falls flat.

Dear Skeptical:

I considered citing to the Bayer v. Housey case, which is on point (and it is cited in the earlier "Patenting Information" post).

If the product of a patented process is intangible (i.e., information), then it does not fall within the extraterritorial exception in 271(g). So I think there is a recognized difference between the tangible/intangible distinction I raised when it comes to method claims.

This does provide one avenue for the women to get a test - send the sample to a country where the method isn't patented. I know there is an argument about burdens here, but if the test is $1,000-2,000 cheaper in Canada (or elsewhere), the cost of a Fed Ex shipment of the sample seems trivial in comparison.

Of course, the real problem is that the insurance company won't pay for the test no matter who performs it or where, which is why even if they prevail the women won't get a remedy. Which suggests that they are merely pawns for the folks with a political (ACLU, PubPat) or financial (doctors and hospitals) agenda. I wonder who really has exploited these women more?

Thanks for the comment.

Dear Saddlepack:

I don't think whether you target a particular mutation matters - look at any of the method claims - if you detect a mutant at an informative position you infringe.

Now, this does raise a claim scope issue for some of the claims. If you construe the claims to be limited to any of the mutations identified at the time of the application then an argument can be raised that detecting another mutation is outside the scope of these claims. And if you interpret the claims to include such later-discovered mutations, I think you have an enablement/written description invalidity problem.

Which is why arguments that these claims "exhaust" the concept of detecting mutations is spurious - if there is a new mutation it should be independently patentable.

Thanks for the comment.

So the argument is that if you buy one embodiment of someone's invention, you're entitled to all of the other embodiments for free?

AMP threw a big bucket of scraps against the wall. If anything does stick, it certainly won't be this.

Dear James:

That is the usual reaction, but not what I'm saying.

For something tangible, once you buy an embodiment the patentee's right to it has been exhausted. In Quanta, the Supreme Court said that this applies to a method claim as well. In Quanta, what was claimed was a method, executed by computer chips which were what was sold.

Now, if the principle of patent exhaustion requires the sale of a tangible object, then the exhaustion principle would not apply to Myriad's claims. But the Supreme Court spoke broadly in Quanta, raising the possibility that performing the same test on the same blood sample from the same woman looking for the same mutation in the same gene might be subject to the exhaustion principle.

There is no answer, just a suggestion (and one that rebuts one of the more emotionally resonant arguments made by plaintiffs in Myriad).

Thanks for the comment.


Kevin: Thanks for clarifying. I understood the second test to be for a different mutation(s).

But even for an "identical" test, on DNA from the very same vial, getting a second test from Myriad is analogous to buying a second "identical" chip from Quanta. The customer ordering a second test is effectively purchasing a second set of probes and reagents from Myriad, so there are physical goods involved. It's just a question of who carries out the lab work. Even if one argues that it's the lab work that "embodies the method", the customer is contracting for a second unit of labor, which is not the "same" labor that was done the first time around.

As I see it, each Myriad test, like each Quanta chip, is an individually marketed unit embodying the invention, and rights aren't exhausted by the previous sale of other units.

James,

I think Kevin might have been pointing out a fundamental difference between method claims and other categories.

Whether or not physical goods are involved in a second test is not material, as the claim isn't to good s used in the method.

The question centers around is it the same method? I think it comes down to what does it mean to "exhaust a method"? The question is qualitatively different for this category. As my first question above alludes to, the courts have not been so kind in extending protection to method claims. It is quite conceivable that the payment of a first method does exhaust "the patent rights" to that method, and the payor does not owe any more for any additional tests - from the patent perspective. Now, from the business and service perspective, the payor may have to pay for each test - but that is a completely different question. In essence, once the first method has been paid for, the payor cannot infringe that method claim, whether or not he pays for the service for subsequent uses of the same method. It is a subtle, but important nuance.

Dear James:

A perfectly reasonable position. However, I did posit that the methods/primers, etc. were not considered to be patented for my hypo.

Thanks for the comment.

Not to be argumentative, but this gets more intriguing the deeper I get into it.

Let's say I patent a method of metal forming that comprises bending the metal at a rate that accelerates and decelerates within certain parameters. The method, surprisingly, gives much stronger formed parts, so they can be made thinner and lighter. I don't claim apparatus or software, just the method.

I license the technology to General Motors. Can it be that GM owes me nothing after fender #1 comes off the presses, because I've exhausted my patent rights?

If the answer is no - and I certainly hope it is - then there's nothing particularly "exhaustible" about method claims per se.

Which brings us to Bayer v. Housey and the distinction between insubstantial and substantial products of a patented process.

Is the argument that I still have an interest in GM's fender #2 (and indeed in fender #2,000,000) because automobile fenders are substantial, whereas if the product had been insubstantial, my patent rights would have been exhausted?

Let's totally abstract the concept from any particular or patented technology:

My claim is to "A method of learning if X is true, by doing Y with beeswax and bubble-wrap."

A (compulsively honest) customer mails me the requested royalty, in payment for the right to find out if X is true by doing Y. Or perhaps, at her request, I employ my own highly trained beeswax and bubble-wrap specialists to find out if X is true. Either way, I get paid, and she learns that -- in her particular situation -- X is true. So far, so good.

The same customer, at a later date, wants to know if X is still true. The (honest but compulsively thrifty) customer asks you whether (a) I am owed a second royalty payment, or (b) my rights are exhausted, and her single payment bought her an unlimited license to conduct future tests herself (or to contract with other highly trained beeswax and bubble-wrap specialists.)

Can she rely on Bayer v. Housey for the proposition that the insubstantial nature of the product gives a different result from that reached in connection with my metal-forming patent?

Bayer v. Housey was decided entirely on (1) the legislative intent and (2) the meaning of "made" in 35 USC 271(g). If the CAFC looks unkindly on method patents, the evidence so far is that it's limited to the context of imported insubstantial products. (Understandable: the court had a real problem with the notion that telling someone what you know, or merely entering the U.S. with the accused "product" in your head, could be an act of infringement.)

We are not dealing with 271(g) here, and I really don't see a judicial prejudice against method claims outside of that context. For that reason, my take is that the "metal-forming" and "determining X" claims get equal treatment in a patent exhaustion analysis.

That said, it is a subtle question, and there's little to prevent an anti-patent judge from holding to the contrary, if only on "policy" grounds -- although I think it would be an example of a tough case making for bad law.

Dear James:

Your comment was the point of my post - this was an easy question to answer 20 years ago, but is less so now, since the zeitgeist has turned against patents.

One difference in your hypo and the Myriad case (besides Myriad being about breast cancer rather than beeswax - and I think that makes a difference to many) is that the second test for breast cancer isn't to determine whether X is still true, but whether X was true in the first place. So essentially looking for the same result (on the same sample, using the same method, etc.).

Another basis for distinguishing between this outcome and the fender hypo is that it isn't the same fender - it's the 2,000,000th fender. So it isn't just tangibility (although that is a part of it).

Thanks for the comment.

I may be the one missing a nuance here, but James your comment:

"I license the technology to General Motors. Can it be that GM owes me nothing after fender #1 comes off the presses, because I've exhausted my patent rights?"

made me wonder - When you licensed your technology (method claim), did you actually license a specific number of uses? If not, did you re-license after the first use?

There may be a conflation here with how you (or anyone) puts a value on a license by so incorporating a per item fee. However, such an arrangement is a business deal, and does not change the patent right - As I mentioned above, not paying for a second test may get you into trouble for a contract or service violation - but in both cases, a patent violation may be off the table.

The question of replicate analyses does make it a much closer call. As a licensee, I'd want to be free to do a test multiple times if I desire some statistical certainty. If this is explicit in the terms of the license, no problem; the question here would be what to do if the license is silent on the matter. (Although perhaps there's a question whether a license that calls for continued royalties on exhausted patent rights is enforceable.)

Myriad, of course, isn't licensing the test - they conduct it themselves. (The fender analogy would have me sell a few fenders to GM, after which they claim to be free to make their own.)

It's a large concept that's at stake; not all DNA tests are $3,000 breast cancer tests.

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