Game Over for Myriad -- Update

(Or, and then there was one were none)

By Kevin E. Noonan --

As discussed for the past month, Myriad has finally given up trying to defend its BRCA gene testing franchise.  The one remaining matter, Myriad's case against GeneDx has settled, as announced by the company today.

However, GeneDx has not moved before the Patent Trial and Appeals Board (PTAB) to dismiss its inter partes review (IPR) challenge under the Leahy-Smith America Invents Act.  Although IPR actions can be settled, they can also be pursued to their conclusions sua sponte by the Board.  The patents at issue in that action are U.S. Patent Nos. 5,654,155; 5,753,441; 6,033,857; 6,051,379; 6,083,698; 6,951,721; 7,470,510; 7,563,571; 7,622,258; 7,670,776; and 7,838,237.  While such a decision would likely be a waste of taxpayer time and money, there may be some sentiment within the Office (which seems to have taken to heart criticisms from the Supreme Court and elsewhere regarding granting "gene patents" in the first place) to render an invalidity decision once and for all on these patents.  Of course, because IPRs are limited to patentability challenges under §§ 102 and 103, the Board could arrive at the (politically) anomalous result that Myriad's claims are patentable despite being patent ineligible under § 101.  The PTAB has previously avoided this outcome in the Sequenom/Isis claims in an earlier IPR by refusing to permit claims to be amended in view of a district court's determination that the claims at issue in that IPR were patent ineligible under § 101, but those circumstances are unlikely to recur here.

Comments

[Paul Cole]

Interestingly the patent in issue in the Sequenom/Isis case survived European opposition, see T 0146/07 Prenatal Diagnosis/ISIS.

There were two documents of special relevance.

In relation to one of them the EPO Appeal Board held that a person skilled in the art reading this document had a motivation to use such enriched cellular fractions as an alternative source of foetal nucleic acid. A motivation to look for circulating, cell-free foetal nucleic acid in serum or plasma samples of maternal blood was, however, not apparent to the board. In relation to the second document the fact that circulating nucleic acid is present in the blood of an individual had been known for many years before the relevant date of the patent. Although different sources of such circulating nucleic acid had been suggested in the literature, there was no conclusive evidence as to where the nucleic acid originated. Neither was there an indication in the literature - at least not in any of the documents cited by the appellant - that circulating foetal nucleic acid might be present in maternal blood. Under these circumstances, the board judges that it would not have been obvious to a person skilled in the art, having regard to either document, alone or in combination with the other, to try to detect a nucleic acid of foetal origin which is paternally inherited in maternal serum or plasma, as proposed. Nor could the claimed subject matter be inferred from knowledge about trophoblast cells.

Accordingly the European patent was maintained with a broad claim substantially similar to that in issue in the US.

The problems that arise from over-stretch of a "contribution approach" were considered by the UK Court of Appeal in Genentech's Patent [1989] R.P.C. 147, where it was observed that:

"Such a conclusion, when applied to a discovery, would seem to mean that the application of the discovery is only patentable if the application is itself novel and not obvious, altogether apart from the novelty of the discovery. That would have a very drastic effect on the patenting of new drugs and medicinal or microbiological processes".

Those familiar with Article 27 of TRIPS will be aware that "utility" in the US equates with "industrial applicability" in Europe. It is the practice in European opposition proceedings to plead every available ground of opposition, and if an attack had been available that the claimed subject matter did not qualify as an invention under the EPC by reason of the natural occurrence of the relevant nucleotide sequences, such an attack would undoubtedly have been mounted. However, no such attack was in issue.

If the outcome in the Federal Circuit is that the claimed subject-matter is deemed ineligible, it will therefore be apparent that the Prometheus/Alice doctrine is being applied in a way and with a rigidity unintended by the Supreme Court and in a way that gives rise to radically different outcomes as between the US and Europe. It is difficult to see how such an outcome could be reconciled with the harmonization intended when the TRIPS treaty was negotiated.

[Skeptical]

Mr.Cole,

Beware the "forced" equivalency between the U.S. "utility" and Europe's "industrial applicability."

At best, they are merely similar. At worst, you offend the "national" sovereignty of each entity, and apply one "entity's" law incorrectly when you seek to make your comparisons.

[Paul Cole]

If an invention is held novel and unobvious in Europe and ineligible in the US there is something odd going on which we in Europe reasonably regard as objectionable.

The answer, of course, is to prefer a construction of US statute and of the opinions of the Supreme and other courts which gives a consistent rather than a divergent result. That has been the doctrine in the US since the Charming Betsy case in the early 1800's, and should be adopted here.

[Kevin E. Noonan]

Dear Paul:

This issue has international implications, as you note. Perhaps the only way to resolve it will be if a foreign government (my money is on France) petitions the WTO to find the US in violation of TRIPS for refusing to acknowledge patent eligibility, and for a new Administration to enforce compliance with our treaty obligations.

But I am an optimist.

Thanks for the comment

[Skeptical]

I fully and respectfully disagree with you Mr. Cole.

Patent law at its core is sovereign law. Please do not be in such a hurry to erase the boundaries of the sovereigns and assume otherwise.

There is NO one world order (yet).

[Bob Cook-Deegan]

Kevin,

You might check with the team at Fox Kiser that did the IPRs. It's my understanding that IPRs will be terminated this week (and there were two more added later, in addition to the 11 you noted in your blog) as part of the agreement, but they should supply the details, not my hearsay.

BCD

[Kevin E. Noonan]

Thanks, Bob. We are monitoring the PTAB website, if only because the Board can continue no matter what the Requestor does. And we don't want to assume - we would like the IPRs, like the case, to be really most sincerely dead.

Hope you are well.

[Simon Elliott]

Skeptical:
While patent law is sovereign law, many sovereigns have signed treaties to harmonize their patent laws, as part of laws promoting international trade. The USA that was the main force behind RIPS over resistance by e.g BRICS for generics, and the Europeans for geographic indications and moral rights. As such, any rapid reversal in policy is relevant and cannot be dismissed by pointing to sovereign law.

Its particularly important that the change in policy is being driven by the Supreme Court, yet issues of international trade policy should be handled by the Executive and Congress.

[Paul Cole]

For the avoidance of doubt, I have no issue with Skeptical on US sovereignty.

My position is simply that if there is a range of possible interpretations of recent US Supreme Court and CAFC opinions, those which are consistent with international treaties to which the US is a party are to be preferred to those which are inconsistent, and that this is an important consideration for US domestic law. As Simon Elliott rightly points out, the presumption should be against fundamental and rapid reversal of policy, and where (as in the infamous Roslin dictum on microorganisms) there is a risk of an outcome that flagrantly breaches TRIPS, it is the duty of US counsel to make the court aware of this fact and ensure that US domestic law does not evolve in a way that breaches the international obligations of the US. In that regard, the duty of US counsel to the Court in my submission over-rides the obligation to any client in any particular dispute.

[Skeptical]

Thank you for the reply Simon.

I would point out that mere treaty is just not self-enacting in the US, and that my point on sovereignty does in fact trump your point on desired "policy" - especially for the United States, where the Executive Branch (and treaties) is just not the branch that was allocated authority to write patent law.

To that end, your desire to point out the policy driver being the Supreme Court highlights a flaw - not a virtue; a bug - not a feature; with what has been going on in the US patent system.

It is critical to understand that only one branch of the US government has been allocated authority to write patent law. Yes, that branch can share its power (and there are sections of the existing code that PROPERLY reflect that shared power (for example, see the section on equitable remedies); but we should be clear that the sections of the law that are in the current cross-hairs of "policy corrections" do NOT have shared authority. Quite in fact, Congress in the Act of 1952 was explicit about its acting to REMOVE shared authority in the 101/103 codification.

[Skeptical]

Thanks for the post Paul.

While I do not disagree with your intent, I will point out (sadly) the notion of "I told you so" and how the lower courts in the US are simply NOT following your lead in how the application of the Supreme Court decision in Alice is being followed.

Sadly, the Supreme Court in Alice simply did not proscribe ANY limit to the use of the so-called "Gist/Abstract" sword, and - as I pointed out to you, - predictably, the application of the Supreme Court decision shows the flaws of that decision.

Like it or not, courts - and even the Supreme Court, do in fact get things wrong. I would submit in response to you that the duty of US Counsel is to ALSO point this out to the Court. To ignore this duty then, to take the "Chamberlain" path instead of the "Churchill" path, is to abdicate the responsibility of counsel every bit as the abdication of your proposed duty.

And yes, I further agree that such a duty overrides the duty to any particular client. I would further posit that such a duty even overrides any particular philosophy towards segments of innovation. Would you choose to be vocal in that regards?

[Simon Elliott]

Skeptical:
The U.S. Congress incorporated the provisions of the URAA (and TRIPS) into U.S. law under 19 U.S.C. § 3511-3556. Therefore, TRIPS is statutory law. The usual disclaimers added to treaties ("not inconsistent with other laws") should not be permitted to swallow the rest of the law.

Even if not statutory law, the Supreme Court has traditionally shown great hesitation to wade into foreign policy, recognizing especially the Executive Branch role. See US v Curtis-Wright.

[Skeptical]

Simon,

You are still preaching the wrong message: patent law is not up to the Executive branch. Deference by the Judiciary for the Executive is misplaced when it is the Congressional branch having been allocated the authority.

Good point though on 19 USC 3511-3556 et seq.

[Simon Elliott]

Skeptical:
My point is not about deference to the executive, but about the court's rulings potentially conflicting with foreign policy.

Ordinarily, the legal status of treaties is complex. In those cases, the courts usually decline review, bunting it to the "political question" bin.

Here, however, there is a treaty negotiated by the executive, codified by the legislature and entered law following Presidential signature. It is consistent with the entirety of post WWII US economic and foreign policy.

There is no question as to its legal standing. In such a context, and in view of 200+ yrs of Supreme Court precedent vis a vis treaties, you would expect a narrow ruling by SCOTUS that does not touch on treaties. Therfore, I believe that the only way to align Myriad with the case law is to read Myriad very narrowly.

[Skeptical]

Simon,

Thank you for your impression.

But as I related to Paul, the mere desire for a narrow reading just does not comport with the decision as written.

As my friends from Boston would say, "You cannot get there from here."

[mike]

I don't think Myriad is done. I think they've taken to trade secret to protect gene sequences and testing that cannot be provided by public sources. They've clammed up and customers will still have to go to Myriad to a comprehensive result. These other labs will only be able to provide results for a limited number of BRCA not the extensive database of information that Myriad has and will likely keep from public eyes in the future.

[Skeptical]

The post by mike has me wondering...

Which stifles future innovation more: trade secrets or patent term for a limited time?

[Simon Elliott]

Skeptical: I think we already know the answer (see, e.g. history), but do our elected officials and judiciary know?

[Kevin E. Noonan]

Skeptical:

I think your Boston friends would also say "because it's wicked faaar!"

Thanks for the comment

[Simon Elliott]

Skeptical: I don't agree with your reading of Myriad. It has too many contradictions.

Soon after it was decided, I was at a meeting where former Chief Judge Michel and former Solicitor General Seth Waxman both advocated for a very narrow reading of the decision. Waxman also said that a decision like this, with its contradictions, and unanimity, should not be subject to the usual picking apart we see with SCOTUS decisions.

[Skeptical]

Simon,

Thank you for your additional view.

However, as I have done so with Paul, "I told you so" rings out as reality has backed up my view.

Mind you, there is nothing wrong with ADVOCATING for a narrow view. There is everything wrong with not recognizing that such a narrow view is just not there.

AS described on another patent blog, the Supreme Court created a weapon of mass destruction (that is what 101 is). They created a powerful sword of "Gist/Abstract." Their creation simply does NOT also come with limits for wielding that sword. There are many comments in the blogosphere inviting practitioners to come up with and suggest limits, either in what they choose to pursue protection for (self-limiting as it were), or as legal arguments that the courts may choose to adopt.

But quite simply, that just is NOT what the Supreme Court has done - they have handed a limitless weapon to the lower courts. No amount of wishful thinking - by anybody - can change what the Supreme Court has actually done.

My view on the matter is to NOT suffer the fool that the Court wants to play (nor suffer those who are eager for the Court to overplay its role based purely on the philosophy of excluding a certain type of innovation). I say that the best way forward is to FULLY embrace what the Court has done. Stomp on the gas pedal to show the full inanity of what the Court has written. The "Gist/Abstract" sword has no limit at the boundary of the particular form of innovation that those cheering on the Supreme Court want to outlaw. Why create such an artificial limit ourselves?

Only when the Court sees the fruits of its labors - the lack of any limits - will then perhaps the Court learn to write better decisions.

I have talked with former Chief Judge Michel about this. While he may not agree with my stomping on the gas pedal, he does agree that the decision is simply inane. As to your comment here from Mr. Waxman, I must admit that I do not understand what you are saying (I would think the opposite - that a unanimous decision so flawed would be - and should be - subject to MORE than the usual picking apart. Cowering from a poor decision, and meekly offering band-aids is the absolute worst thing to do. A strong rebuff, and failing that, full consequences are in order.