J.E.M.: The Supreme Court’s Last Expansion of Patent Protection, 20 Years Ago

“The Supreme Court’s pattern over the past two decades casts a cloud over innovation, even as technology has evolved in virtually every industry and every aspect of life.”

https://depositphotos.com/21374219/stock-photo-supreme-court-storm.htmlIn 2001, the U.S. Supreme Court ruled for the first time that plants could be protected with utility patents. J.E.M. Ag Supply, Inc., v. Pioneer Hi-Bred International, Inc. 534 U.S. 124. This landmark decision, originating in the agricultural heartland of Iowa, was the last time the Supreme Court effectively increased patent protection for inventors and patent owners. Most, if not all, of the Supreme Court’s patent rulings in the past two decades have not been favorable to patent owners. Rather, these “recent” decisions have restricted patent rights and made it more difficult to enforce these rights against infringers.

SCOTUS’ Last Patent-Friendly Pronouncement

J.E.M. involved the question of patentable subject matter under 35 U.S.C. § 101. In particular, the issue addressed by the Court in J.E.M. was whether sexually reproducing plants, including crops and flowering plants, could be protected by utility patents. Historically, plants had been protected under the Plant Variety Protection Act (PVPA), 7 U.S.C. § 2321, and the Plant Patent Act (PPA, enacted in 1930), 35 U.S.C. §§ 161-164. The Supreme Court, in ruling in favor of utility patents for these plants, rejected the argument that the PVPA and the PPA were exclusive means for plant protection. Justice Clarence Thomas’ majority opinion noted that Congress plainly contemplated that patent laws be given wide scope, citing Diamond v. Chakrabarty, 447 U.S. 303 (1980). The Court stated, “As in Chakrabarty, we decline to narrow the reach of Section 101 where Congress has given us no indication that it intends this result.” The Court explained the subject matter provisions of the patent law have been cast in broad terms, to fulfill the constitutional goal of “promoting the Progress of Science and the useful Arts, with all that means for the social and economic benefit envisioned by [Thomas] Jefferson.” As further stated, Section 101 is a “dynamic provision designed to encompass new and unforeseen inventions.”

Festo and eBay and Medimmune, Oh MY

While the patent statutes are supposed to promote the progress of science and the useful arts, it seems that Supreme Court decisions since J.E.M. often have had the opposite effect. For example, in 2002, the Court broadened the application of prosecution estoppel, wherein the scope or coverage of a patent may be deemed to be surrendered in view of an amendment, such that the doctrine of equivalents for infringement was restricted. Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., 535 U.S. 722 (2002). This has led to hesitancies in patent application amendments which years later might be construed to preclude findings of infringement for arguably equivalent devices having very minor changes from the patented product.

A few years later, the Court effectively put a halt to the long-standing practice of permanent injunctions after a finding of infringement. eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006). Thus, even though a patent gives the owner the exclusive right to prevent others from practicing the invention (35 U.S.C §154), adjudicated infringers have avoided injunctions, absent the patent owner establishing the four factors for injunctions in non-patent cases.

Then the Supreme Court allowed licensees to challenge validity of patents for which they were paying royalties. MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007). So, the licensee could have the benefit of a license but then recoup royalties if they prove that the patent was invalid for some reason.

From KSR to Oil States, the Trend Has Continued

In 2007, the Court also decided KSR, which made it easier for patents and patent applications to be declared obvious over the prior art. KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398 (2007). This often lengthens application prosecution due to weak or more frequent obviousness rejections, and potentially lowered the burden of proof of obviousness by infringers in litigation.

The Bilski case in 2010 related to subject matter eligibility and judicial exceptions to patentability. Here, the Supreme Court determined that a method of hedging losses in one segment of the energy industry by making investments in other segments of that industry was an abstract investment strategy, and thus not patentable. Bilski v. Kappos, 561 U.S. 593 (2010). Rather than limiting the holding to the specific facts of the case, Bilski has effectively raised the bar for software and business-related inventions.

The Court then followed with Mayo in 2012, which held that an invention for a method of treating a patient with drugs was not patentable since it covered a natural law. Mayo v. Prometheus, 566 U.S. 66 (2012). Then, in another case on patentable subject matter, the Court held that an invention directed to isolated DNA sequences was actually a naturally occurring DNA segment, and thus not protectable. Association for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576 (2013).

The much-maligned Alice decision in 2014 has led to a lot of critique with respect to abstract ideas not being patentable. Alice Corp. v. CLS Bank International, 573 U.S. 208 (2014). One problem with the decision is the Court did not define “abstract,” and subsequent lower court decisions have struggled with consistency regarding the test for determining whether a claimed invention is merely an unpatentable abstract idea.

Then, in 2018, the Supreme Court concluded that patents are a public right, and more specifically, a public franchise, which the government can authorize and deauthorize to a private without intercession of an Article III court. Oil States Energy Services, LLC v. Greene’s Energy Group, LLC, 584 U.S. ___ (2018). Thus, patents, even as private property, are subject to the PTAB “death squad.”

Disintegrating Incentives

The Supreme Court’s pattern over the past two decades casts a cloud over innovation, even as technology has evolved in virtually every industry and every aspect of life. It often takes investments of significant time, money, and other resources to do the research and development of inventions which have the potential to improve the current state of the art. Without a strong and predictable patent system, the incentive to make such investments disintegrates. Expanding patent protection can provide the motivation and rewards which the Constitution contemplates in promoting the progress of science and the useful arts, as provided by our founding fathers in Article I Section 8 | Clause 8.

Note: The J.E.M. case was argued by the author’s colleague, Edmund J. Sease of McKee, Voorhees & Sease.


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Join the Discussion

16 comments so far.

  • [Avatar for Anon]
    November 22, 2021 10:48 am

    My reply never made it through TFCFM.

    Suffice to say, we have seen your excuses previously, and for all of the noise that you make about engaging on the merits, such is just not what you do.

  • [Avatar for TFCFM]
    November 19, 2021 10:16 am

    Anon @ #12 “…tell me more

    My workload doesn’t permit me the luxury of quibbling about how many angels-on-the-head-of-a-pin would consider my analogy literally and perfectly accurate.

    As cases arise, I trust we’ll discuss actual fact situations and judicial interpretations.

  • [Avatar for Anon]
    November 17, 2021 10:02 am

    Finding some disputes to be outside the boundaries of the patent laws that Congress enacted,

    LOL – do, please, tell me more of this point of yours. Which boundary exactly are you thinking of?

    We can then deal with your adage of strike zone, and the difference between legislating from the bench (creating a differently defined strike zone) and any ACTUAL interpretation.

  • [Avatar for TFCFM]
    November 16, 2021 03:29 pm

    Curious @ #8…the Supreme Court ought NOT be diminishing patent rights, which they have FREQUENTLY done. Are you willing to make that pronouncement as well?

    I agree that the two propositions are opposite sides of the same coin — the coin being that the Supreme Court (like all subordinate courts) ought to be interpreting the patent laws the way Congress enacted them.

    Finding some disputes to be outside the boundaries of the patent laws that Congress enacted, however, is not “diminishing” patent rights, however — which is what I believe you are attempting to suggest.

    Our courts must interpret, as best it can, the “strike zone” that Congress sought to define and then call balls and strikes in individual disputes based on its best understanding of that strike zone.

  • [Avatar for Anon]
    November 15, 2021 02:05 pm

    To Mr. Malone’s point of

    This is true even with respect to ISSUED patents….

    … the government can unilaterally change the terms of the patent resulting in revocation…

    Our friend Greg DeLassus likes to remind people that the (full) term “public franchise” is STILL a form of personal property.

    But any such form would NOT mean what the Office asserted in the Oil States case. It does not mean that the Office can do anything at all.

    Quite in fact, agency theory and treatment of Franchises invokes meaningful limits and responsibilities on the FranchisOR to the FranchisEE.

    My Uncle Ben would always say, “With great power, comes great responsibility.”

    The Oil States case (and the Office actions implicit therein) show an indulgence in great power and a shirking of ANY sense of responsibility to the innovator or her assigns.

  • [Avatar for Anon]
    November 15, 2021 01:57 pm

    I have to (strongly) agree with TFCFM here.

    (and would point out that we still likely disagree when it comes to the converse: the Court “constricting” the statute and narrowing patent law – for the very reason he lists: “that is a legislative function, properly performed only by the legislature.

  • [Avatar for Curious]
    November 15, 2021 01:02 pm

    The Supreme Court ought NOT to be “expanding” patent law — that is a legislative function, properly performed only by the legislature.
    Agree [checks name of poster, shrugs shoulder]. However, the other side of that coin is that the Supreme Court ought NOT be diminishing patent rights, which they have FREQUENTLY done. Are you willing to make that pronouncement as well?

    “Expanding” patent law was not what the JEM Ag Supply case was about.
    Yes it was. The fact that plant patents were issued doesn’t mean it was settled law.

  • [Avatar for Josh Malone]
    Josh Malone
    November 15, 2021 12:28 pm

    Nancy has a fantastic point. USPTO lawyers argue AGAINST inventors in over 80% of cases. This is true even with respect to ISSUED patents. The USPTO lawyers (the solicitors and the PTAB staff) consistently take the side of the large corporations accused of infringement (or their hired guns).

    A number of cases the corporation has dropped out of the appeal, yet the USPTO voluntarily intervenes to attack the inventor.

    Check out Gene Luoma’s story – https://www.youtube.com/watch?v=zcQz2JLOlAI

    And Susan McKnight – https://www.youtube.com/watch?v=5dh20p609QA

    And David McCutchen – https://www.youtube.com/watch?v=3gXMNJuG5ps

    McCutchen was the inventor (deceased while the case was pending) in the Christy case. The USPTO lawyers prevailed at the Federal Circuit by arguing that since patents are privileges from the government, the government can unilaterally change the terms of the patent resulting in revocation which means the inventor never had a property right, therefore nothing was taken and no compensation is due under the 5th Amendment.

    It’s not just that USPTO lawyers don’t support inventors – they have aggressively and relentlessly attacked us.

  • [Avatar for Pro Say]
    Pro Say
    November 15, 2021 11:08 am

    While the SCOTUS – CAFC tag team continues its 20-year assault on the protection of critically-important, and indeed life-saving innovations . . . Congress sits in the stands . . . munching on popcorn.

  • [Avatar for TFCFM]
    November 15, 2021 10:42 am

    I’m reminded of the fable of The Blind Men And The Elephant — each sees only what the one focuses upon.

    Two primary thoughts:

    1. The Supreme Court ought NOT to be “expanding” patent law — that is a legislative function, properly performed only by the legislature.

    2. “Expanding” patent law was not what the JEM Ag Supply case was about. Instead, one group of litigants asserted that utility patents could not properly be granted to plants and parts thereof — DESPITE the fact that over a thousand such patents had already been granted (including the patents at issue in the matter).

    Recognizing the blindingly-obvious fact that statutory silence does not render plants not-utility-patent-able, the Court declined the litigants’ invitation to add a “no-plants” limitation to the statute that the legislature wrote. This is not an “expansion” of patent law in any reasonable sense.

  • [Avatar for frank odonnell]
    frank odonnell
    November 15, 2021 08:58 am

    I believe that many Patents simply stolen and used without discovery or disguised to
    hide them.

    Overheard Conversations prove it !

  • [Avatar for Nancy Linck]
    Nancy Linck
    November 15, 2021 08:25 am

    You are correct. And part of that can be blamed on PTO leaders who have not gone to bat for patentees. When I was the Solicitor under Bruce Lehman, we advocated for the patent holder in a number of cases, including Markman v. Westview and Warner-Jenkinson v. Hilton-Davis and were successful in obtaining DOJ’s support and ultimately prevailing at the Supreme Court. I have not seen that type of advocacy since that time. Perhaps it resulted from a change in the PTO’s organization after I left, but I have been very disappointed with PTO’s influence — or lack of positive influence — on Supreme Court decisions. In my opinion, Bruce Lehman does not get credit for his strong support of strong patent rights before the Supreme Court (and in the PTO). In fact, he was derided for insisting that applicants be treated as “customers.” Perhaps that wasn’t the best way to describe their relationship to the PTO, but it did reflect a mindset that promoted supporting strong patent rights, which you rightly observe is not reflected in Supreme Court cases since Bruce’s time in the PTO. Very sad!

  • [Avatar for Night Writer]
    Night Writer
    November 15, 2021 08:02 am

    Very well written.


  • [Avatar for B]
    November 14, 2021 04:42 pm

    Very well written article.

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