Law Review Article Advocates Supreme Court's Patent Eligibility Law is Unconstitutional

By Kevin E. Noonan --

Sherry Knowles, former chief patent counsel of GlaxoSmithKline, and Dr. Anthony Prosser, a member of her team at Knowles Intellectual Strategies LLC, have written an article recently published in The John Marshall Review of Intellectual Property Law entitled "Unconstitutional Application of 35 U.S.C. 101 by the U.S. Supreme Court."  The authors' thesis is stark:  that the Supreme Court has improperly (and unconstitutionally) arrogated to itself a definition of patent eligibility that is inconsistent with over 200 years of statutory law enacted by Congress under its Article I powers.

The authors tracked the legislative history of 35 U.S.C. § 101 from the beginning of the U.S. patent system to enactment of the Leahy-Smith America Invents Act, and set forth a side-by-side comparison of the statute with the "common law" created by the U.S. Supreme Court case law during this period, which the authors consider to be inconsistent.  The conclusion is expressed in a simple but compelling premise that "A or B" is inconsistent with "A not B," which represents the structure of the statute ("Whoever invents or discovers"), compared to the Supreme Court's common law approach (that an applied discovery cannot constitute an invention; see, e.g., AMP v. Myriad Genetics).  According to the authors, since the Constitution gives sole authority to Congress to create laws that promote the progress of science and the useful arts, any opinions by the Supreme Court that fail to apply the first four words of the statute in the disjunctive is an assertion of an authority the Constitution does not give the judiciary.

The authors take direct aim at the "judicial exceptions" to patent eligibility created by the Court.  Their position is that despite diligent effort they can find no legal basis for the Supreme Court to make a judicial exception to any federal statute, much less § 101.  In this context, these authors note an opinion handed down by the Court on January 8, 2019, in the arbitration setting, in which the Justices unanimously held that the pattern of creating an exception to a federal statute by certain Courts of Appeal was inconsistent with the text of the Act and its precedent (see Henry Schein, Inc. et al. v. Archer & White Sales, Inc., No 17-1272).

The article supports these arguments with a review of the many and various Patent Acts (up to and including the 1952 Patent Act authored by Giles Sutherland Rich and PJ Federico and the Leahy-Smith America Invents Act)*, showing that "discoveries," as enunciated in Article I, Section 8, Clause 8 comprise statutory subject matter in all of them (except for a brief time in the early 19th Century, prior to the 1836 Act that established peripheral claiming for U.S. patents).  Specifically, regarding the 1952 Patent Act, the authors set forth testimony and statements from the legislative history, including a discussion of Funk Bros. Seed Co. v. Kalo Inoculant Co, that provides evidence that Congress was encouraged to eliminate "discovery" from the statute but declined to do so.  For example, the authors highlight that the Department of Justice gave testimony at the hearings on the 1952 Act specifically asking Congress to remove the words "or discoveries" from the statute, using the typical arguments that have been propounded for that.  Instead of refusing the request, Congress did the opposite -- it added a definition of invention to 35 U.S.C. § 100 to affirm its intent that discoveries be included (35 U.S.C. § 100(a)).  This was only a few years after Funk, and according to the authors, is a direct rebuke of the case.

The authors argue that this evinces a determination by Congress that discoveries are patent-eligible, and that the judiciary must respect this determination by the legislature.  Indeed, the article cites various authority from the Court itself that its only proper role is to interpret the laws as Congress has written them, citing Lockhart v. U.S., 136 S. Ct. 958, 962 (2016); D.C. v. Heller, 554 U.S. 570, 598 (2008); Hartford Underwriters Ins. Co. v. Union Planters Bank, N.A., 530 U.S. 1, 6 (2000); Connecticut Nat'l Bank v. Germain, 503 U.S. 249, 253-254 (1992); and Caminetti v. United States, 242 U.S. 470, 485 (1917).  In this context, the "implicit" or "judicial" exceptions enunciated by the Court is, in the authors' view, improper.

The article next explicates some of the relevant case law, from Le Roy v. Tathum, 5 U.S. 156 (1853), through O'Reilly v. Morse, 56 U.S. 62 (1854), for an understanding of how the Court fulfilled its reviewing role in those days.  The authors correctly note that neither of these cases stand for a broad proposition of what is and isn't patent eligible (Le Roy being remanded on novelty grounds and Morse based on overbreadth and lack of support) and that they both concur that while a patent cannot be granted on the natural law, it can be obtained for an application of that law.  The authors find the break with judicial tradition, and the beginning of Supreme Court overstep in this aspect of the law, in Funk Bros. Seed Co. v. Kalo Inoculant Co., 333 U.S. 127 (1948), an opinion by Justice Douglas that has been used more recently by the Court and others to justify the modern expansionist application of the judicial exceptions, in their opinion, in direct contradiction to the language of 35 U.S.C. §§ 100(a) and 101.  The authors find error in Justice Douglas contradicting the well-established principle that an application of a law of nature was patent eligible; after all, the patent at issue in Funk Bros. was for a composition comprising combinations of nitrogen-fixing bacteria based on their ability to grow together without mutual growth inhibition.  The article argues that this application of the biological principle was well within the proper boundaries of applications of laws of nature that should be patent-eligible (a position supported by the almost wholesale neglect for this precedent after enactment of the 1952 Patent Act; indeed the case was only resurrected by Justice Thomas on his Myriad opinion).  They characterize Justice Douglas's opinion as stating that:

[A] commercial product based on the application of a discovery about how nature works to produce a new and useful scientific advance cannot form the basis for a patent unless it is also an invention. This statement not only directly contradicts the earlier Le Roy opinion, it also directly contradicts the statutory determination by Congress that any composition of matter "invention or discovery" is patent eligible.  This faulty analysis formed the initial threads for the Supreme Court's parallel case law on patent eligibility, and is repeatedly cited by the Court as its authority.

This section then explicates the Court's misapplication of its role in Gottschalk v. Benson, 409 U.S. 63 (1972) (Justice Douglas again), and Parker v. Flook, 437 U.S. 584, 587 (1978) (Justice Stevens) (over a dissent by Justices Stewart, Rehnquist, and Burger).  Of Benson, the authors write:  "The Court was concerned with affirming such a broad scope of monopoly, but that was not their decision to make, which should be limited to strict statutory construction."  The authors credit the Chakrabarty Court for recognizing the importance of the legislative history and Congressional intent ("anything under the sun made by man") despite this decision's role in canonization of the "judicial exception" narrative.  Diamond v. Chakrabarty, 447 U.S. 303 (1980).  Also, with regard to these cases, the authors term "exaggerated and false" examples of discoveries such as the law of gravity and E=mc² to discredit discovery, saying that "Congress had already given clear legislative intent that such as not patent eligible" and "[t]he Court need go no further than statutory construction and legislative intent to reach a patent eligibility decision."  And the authors refute the Court's claim of statutory stare decisis in Bilski v. Kappos, 561 U.S. 593 (2010), in support of its assertion of the judicial exceptions, insofar as Congress has included the term "discovery" in the Patent Act the entire time the Court has been developing its jurisprudence on the scope of patent eligibility.

The authors find cause for particular opprobrium in the Court's recent decisions, AMP v. Myriad and Mayo v. Prometheus, for different reasons.  Regarding the Mayo decision, the authors note that the Court ignored the Government's arguments that the defects in the Prometheus claims were better addressed by other sections of the Patent Act (§§ 102 and 103, specifically) and substituted its judgment on a policy issue for those of the Executive branch.  The authors cite both these decisions as examples of judicial overreach, noting for example the policy statements Justice Breyer asserts in the Mayo opinion regarding the economic balance between patent protection and third party freedom to operate (otherwise known as "the Goldilocks effect"; see A Modest Proposal (or Two)):

The Constitution has not granted any authority to the Supreme Court to carry out economic analysis of what should be patent eligible, nor is it equipped to do so.  The Supreme Court does not have the power to commission white papers, take testimony, review independent evidence, have one-on-one meetings with stakeholders or to take depositions, which are necessary to create public policy.  Amicus briefs, while useful, do not take the place of these tools.  The Supreme Court is arguably the worst equipped of the three branches of the government to evaluate patent policy.  For this reason, our founding fathers did not give the Supreme Court the authority to set policy, although, as illustrated by the Mayo case, the Court has crossed that line.  Creating a careful balance between the scope of incentive to promote the progress of science and impeding ancillary research is the sole domain of Congress.

Regarding the Myriad decision (which the authors term the "apex" of the Supreme Court's unconstitutional application of Section 101), these authors call out Justice Thomas's statements that, no matter how beneficial or groundbreaking an invention may be, if based on an isolated DNA molecule it is a product of nature and thus not patent-eligible ("Groundbreaking, innovative, or even brilliant discovery does not by itself satisfy the § 101 inquiry").  These statements have been used, most notably in Ariosa v. Sequenom, to invalidate several just such groundbreaking inventions, with clearly negative effects on innovation (see Ariosa Diagnostics, Inc. v. Sequenom, Inc. (Fed. Cir. 2015); Cleveland Clinic Foundation v. True Health Diagnostics LLC (Fed. Cir. 2017); and Athena Diagnostics, Inc. v. Mayo Collaborative Services, LLC (Fed. Cir. 2019)).

The authors' points are well stated, and perhaps it is only by raising the clarion call against the Supreme Court's jurisprudence that effective steps can be taken.  The bold premise is bound to motivate conversation in a needed area.  This conversation is important because unfortunately for the American patent system, innovation, and economy (see U.S. Drops to 13th in Worldwide Patent Protection According to Study Released by U.S. Chamber of Commerce), the only path other than the Court "seeing the light" (which could perhaps arise should the Wall Street Journal ever run the headline, "Supreme Court Destroys U.S. Industry"), will be to wait until Congress gets around to changing the law.  And the negative consequences, to innovation and American competitiveness, are clear (if not patent) and deleterious.  Part of the problem is the failure of the Office and the Federal Circuit to push back and overly (and slavishly) apply the recent cases unnecessarily broadly.  As Nancy Linck told Drew Hirschfeld at BIO a few years ago, it is the Executive Branch's responsibility to use the Court's rulings as a guidance in applying the law.  A quick re-read of In re Bergy illustrates how the Federal Circuit should have decided Ariosa.  But in the absence of forcing the Court to recognize its errors by working through their consequences, all that is left is the current legislative remedy, with all its accompanying deficiencies.

Until then we are stuck with The Tyranny of the Judiciary, a consequence of our system of government recognized by the Founders.  But if we are to have any traction in changing the current circumstances and their consequences, then policy makers, legal academics, editorial writers and pundits both patent and general need to heed these authors' concluding words:

How many industries will be destroyed and applied discoveries not advanced for the promotion of science in the meantime?

* Patent Act of 1970, Pub. L. No. 1-34, 1 Stat. 109 (1790); Patent Act of 1793, Pub. L. No.2-53, 2 Stat. 318 (1793); Patent Act of 1836, Pub. L. No. 24-357, 5 Stat. 117 (1836); Patent Act of 1842, Pub. L. No. 27-288, 5 Stat. 543 (1842); Patent Act of 1870, Pub. L. No. 41-230, 15 Stat. 198 (1870); Patent Act of 1897, Pub. L. No. 55-391, 29 Stat. 692 (1897); Plant Patent Act of 1930, Pub. L. No.71-312, 46 Stat. 376 (1930); Patent Act of 1952, Pub. L. No. 82-593, 66 Stat. 792 (1952).

Comments

[Karl P. Dresdner, Jr. PhD,]

The authors of this article show the Supreme Court is guilty of malpractice of patent law and in particular regarding 35 USC Section 101 is very real. Judge empowered to decide patent cases should be required to have been trained in science and thus to have a technical science PhD. Medicine cannot be practiced by doctors who never went to medical school. Judges should not be given the right to play God with patents and patent laws when the judges are cannot function at a high invention science level.

[EG]

Hey Kevin,

Knowles/Prosser are spot on with this article. Our arrogant Judicial Mount Olympus has grossly exceeded its judicial authority when it comes to interpreting (or more accurately, deliberately misinterpreting) Section 101 and patent-eligibility. The Justices who supported Mayo, Myriad, and Alice get an F as far as I'm concerned.

[Josh Sarnoff]

Perhaps they should read Jeffrey Lefstin's excellent work, Inventive Application: A History, 67 Florida L. Rev. 565 (2015), which largely agrees with the point that the current "inventive application" of discoveries requirement was first adopted in Funk Brothers but also notes that Congress also considered expressly overruling Funk Brothers and declined to adopt that language, and that circuit courts of appeal in the 1950s continued to find the"inventive application" requirement part of Section 101 (as a matter of statutory interpretation). They can also read Joshua Sarnoff's (my) A.M.P. v. Myriad Amicus brief (Supreme Court No. 12-398, for fifteen law professors) and article Patent-Eligible Inventions After Bilski: History and Theory (63 Hastings L.J. 53 (2011), which collectively explain that "inventive application" originated even earlier with O'Reilly, and that P.J. Federico -- the other principal co-author of the 1952 Act, who most likely understood its meaning -- argued successfully in, and the CCPA before Judge Rich joined it contemporaneously held in, Application of Ducci 225 F.2d 683, 1955, that Section 100(b) (which defines "process for 101") did not apply to all new uses, but only to non-analogous uses, reinstating the the Supreme Court's Ansonia Brass standard, 144 U.S. 11(1892) as an interpretation of Section 101's eligibility requirement for an "invention" and "process"(which is the equivalent of today's "inventive concept" requirement in Flook, Bilski, Mayo, and Alice). (Note also -- and see the recent Helsinn decision -- that Section 100(b) and 101 were not revised as to either "invents or discovers" or in regard to the three categories of products recited, which remain subject to the Chakrabarty "markedly different" standard (also applied to iDNA but not to cDNA in Myriad, where the Court inconsistently applied a simple novelty standard), and thus preserved Funk Brothers "inventive application" standard -- as it is a general rule of statutory construction that reenactment of statutory text without clearly demonstrating a change of interpretation preserves -- rather than changes, as Judge Rich later wished -- the prior statutory interpretation. Note further that Ansonia Brass was decided under the same statutory language of "invention or discovery" in regard to "process" (although then the Section 101-predecessor used the term "art," not "useful art"), which is why Application of Ducci had to construe the meaning of Section 100(b) "process" and how it changed the meaning of "process" (earlier art) under prior eligilbity doctrine as previously interpreted (and the rule is the latest in time SCT decision controls) otherwise carried forward in the statute.

Finally, the "unconstitutional" rhetoric is simply wrong and misleading, as the so-called "judicial exceptions" were always statutory interpretations (in OReilly, Funk, Flook, and since) of the same statutory "invents or discovers" language, and thus the argument is simply that the courts have miscontrued the statute. It would be correct to make a constitutional argument (as I have) that Congress lacks the authority to authorize patents currently held excluded as a statutory matter should Congress choose to do so (and in Bilksi there were arguments that the Constitution did not authorize patents on business methods as not "useful arts"), but unless they are stating that Congress MUST authorize the PTO to issue patents that the judges are holding invalid under the statute, this is simply a garden variety statutory interpretation case, with the unconstitutional argument intended to pander to public sentiments for those already (or who might then be) inclined to believe that argument or to make weight for the statutory construction argument. Can anyone seriously believe that the constitutional language of legislative power is also a constitutional command to issue patents (and for "everything under the sun made by man")? No serious constitutional law scholar would ever make that argument, and if it were true think about all the other Article 8 powers granted to Congress that would then have to be exercised by legislation by Congress to the full extent of the power granted in every case?

I would not, therefore pay too much attention to the article, given these glaring failures of basic legal reasoning. That is, unless and until the Supreme Court is willing to reject history and precedent and then return to modern dictionary definitions and pure textualism. But then I will apply for patents for a new star or for a new musical composition on a recording medium (See Judge Archer and Judge Nies' dissent in Alappat). For surely those "inventions" are "discoveries" and are "practical" applications of discoveries (because I can enjoy them through a telescope or make people happy or sad once they listen to my compositions; if we were ever to be able to get there, however, and if the star were then made part of U.S. jurisdiction, I would then have the right to exclude people from that star). They just are not the kinds of "discoveries of inventors" ever contemplated by either the Constitution or the Congress in the Patent Act, from 1790 to the present. Rather, they are "discoveries" of scientists (just like America was the "discovery" of an explorer, not of an inventor) and of artists (for which copyright protection is provided, and which should, but appears not to, suffice for some intellectual property rights maximalists).

[Josh Sarnoff]

PS - bad legal history and bad legal arguments are not the answer to the confused jurisprudence of the Supreme Court interpreting Sections 100(b) and 101, and consequent highly undesirable state of affairs. Rather, new legislation that clarifies both the meaning and the limits of eligiblity doctrine is to be hoped for -- but may not be possible given disparate beliefs regarding what patents any legislation should authorize and should exclude from eligibility. But if it is possible to get such legislation, that revised eligibility provision will be constitutional unless (as it appears was the case in Bilski for Justice Steven's concurrence before it may have lost a single vote) there is in fact a constitutional restriction to "useful arts" that there would now be five Justices to agree to or on the scope of "discoveries" of "inventors" for which the Constitution authorizes Congress to provide the authority to the PTO to grant. And the latter argument may still apply currently (under the "inventors for their .... discoveries" part of the Authors and Inventors Clause) to some patents that continue to be issued (notwithstanding the inventive application statutory test, when properly applied; if the statute as interpreted is improperly interpreted or applied, it is similarly only a statutory -- ultra vires -- argument and not a constitutional one, which should remind people of the current debate over "the Wall"). But there is no meaningful or appropriate constitutional argument that Congress is _required_ to enact any legislation to overrule the Court's current (and confused) jurisprudence interpreting Congress' earlier enactments. Not even Marbury v. Madison goes anywhere near that proposition.

[Srikumaran Melethil]

Quick fundamental question: How can the Supreme Court act unconstitutionally when it is the entity that decides what is constitutional? More after I read the article.

[John T. Aquino]

Thank you, Kevin, for the excellent article that clearly presents Sherry and Anthony's well researched and cogently expressed arguments. I well remember the BIO conference a few years back when I was covering it as an attorney-journalist, with Nancy urging the PTO to push back at the Supreme Court on its recent patent decisions, as she had pushed back against Funk Bros, Benson, and Flook as solicitor of patents and trademarks in the 1990s. and to stop relying on its dicta.

[Skeptical]

Can you say: "Kavanaugh Scissors?"

[Skeptical]

...for those that have not been following along, the coined term comes from the combination of the provided HOLDING of Justice Kavanaugh, as mentioned in Schein, coupled with the explication provided by the SAME Justice Kavanaugh in the oral arguments of California Franchise Tax Board v. Hyatt.

[Cass L. Singer]

To paraphrase my 12 Feb 2019 comment regarding Athena Diagnostics v. Mayo (Fed. Cir.):

Who bells the cat?

I don't expect Congress to impeach self-styled "conservative," "strict constructionist" or "originalist" Supreme Court Justices for hypocrisy over mere patent law. Are they any worse than J. Douglas was for patents?

Further in this forum deponent saith not.

[Skeptical]

Sorry Josh, I could not parse through that veritable WALL of text. Can you repeat your message in more "bite-size" thoughts?

[EG]

Professor Sarnoff,

Fair enough that the "argument is simply that the courts have misconstrued the statute." Indeed, SCOTUS has literally read "or discovers" out of 101, as well as 100(a). It's not SCOTUS' call to determine what patent policy should be when interpreting (not rewriting) the patent statutes-that was committed to Congress by the Patent Clause. And SCOTUS still gets an F in my book for such deliberate misinterpretation in Mayo, Myriad, and Alice.

[BP]

Professor Sarnoff,

I would be more interested in what you are saying, if the hyperbole was removed and reality considered. Perhaps you do not understand that the PTO has been failing to issue patents that are clearly eligible under 35 USC 101. Dir. Iancu recognizes that failure and, hence, the new 101 guidance (84 Fed. Reg. 50). The damage done to the economy is real. Special interests are largely to blame, the myth of the "patent troll" was a canard to shift litigation risks/costs of some companies onto the patent office with the benefit of easing district court litigation dockets. Taxpayers subsidize the IP of companies like Nike through CBP, why not subsidize others too? That's what's happening.

Please review and consider re-writing below in the context of reality, like "imagining" forcing the PTO to issue patents that are clearly eligible! How about that right?

Excerpt:

but unless they are stating that Congress MUST authorize the PTO to issue patents that the judges are holding invalid under the statute, this is simply a garden variety statutory interpretation case, with the unconstitutional argument intended to pander to public sentiments for those already (or who might then be) inclined to believe that argument or to make weight for the statutory construction argument.

Can anyone seriously believe that the constitutional language of legislative power is also a constitutional command to issue patents (and for "everything under the sun made by man")? No serious constitutional law scholar would ever make that argument, and if it were true think about all the other Article 8 powers granted to Congress that would then have to be exercised by legislation by Congress to the full extent of the power granted in every case?

[Skeptical]

Another Lefstin work:

http://www.ipwatchdog.com/2017/06/11/lefstin-mossoff-critique-scotus-todays-patent-system/id=83830/

Kavanaugh Scissors element: there is an egregious mistake...