Posts Tagged: "patents"

Last month, business news outlets were reporting that stock prices for pharmaceutical firms Pfizer and Merck took a tumble after financial analysts downgraded the performance of both firms over concerns about impending patent cliffs or exclusivity issues – although more recent reports paint a mostly promising picture for the companies, thanks to upcoming acquisitions. A pharmaceutical analyst for UBS downgraded Pfizer from buy to neutral, citing the loss of patent protection in the 2025 to 2029 timeframe for several drugs which contributed 30 percent of Pfizer’s total revenue in 2015. For Merck, although patent expiry wasn’t cited in a note from a pharmaceutical analyst from BMO, that analyst dropped Merck’s rating from outperform to market perform based on the expectation that the company’s blockbuster cancer drug Keytruda would face increased competition in the immuno-oncology field during 2019. As of January 30, stock prices for both firms were down by at least a dollar per share from their closing price on January 23. The downgrades for both firms are further proof of the importance of maintaining exclusivity through patent protection to pharmaceutical firms.

It seemed like a trade secret trifecta when Congress in 2011 passed the America Invents Act (AIA). Although the statute was aimed at patent reform, it made three helpful changes in how trade secrets are treated. First, companies could hold onto secret information about an invention without risking invalidation of their patents for failing to disclose the “best mode” of implementing it. Second, the “prior user right” that guarantees continuing use of a secret invention, even if someone else later patents it, was extended to cover all technologies. And third, the law would no longer deny a patent simply because the inventor had already commercialized the invention in a way that didn’t reveal it to the public. Or so we thought. That last change depended on how you read the legislation. The long-standing requirement that an invention could not be “on sale” or “in public use” more than a year before filing a patent application was still there. But Congress added a qualifier to 35 U.S.C. §102: there would be no patent if the invention had been “in public use, on sale, or otherwise available to the public . . . .”

On Tuesday, February 19, the U.S. Supreme Court heard oral arguments in Return Mail Inc. v. United States Postal Service, a case that asks the nation’s highest court to determine whether the federal government constitutes a “person” for the purposes of instituting review proceedings at the Patent Trial and Appeal Board (PTAB) under the Leahy-Smith America Invents Act (AIA). Although the Supreme Court Justices appeared to be dissatisfied with arguments from counsel for either side, they arguably pushed back more against the USPS’ position. All Justices apart from Justice Clarence Thomas played an active role in questioning.

In 2014, Elon Musk made Tesla’s patents available for anyone to use for free, stating that “technology leadership is not defined by patents.” Earlier this month, Musk announced again that he had released all of Tesla’s patents, promising the company “will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology.” Musk believes patents only serve “to stifle progress” and that by releasing his patents he can help get progress moving again—and that progress will somehow win the fight against climate change. But do patents stifle progress, and will releasing patents really have this result? Patents are a trade with a government. The inventor agrees to disclose the invention to the public in exchange for a limited exclusive right to the invention. No one else can make, use, sell or import the invention without the inventor’s permission. The public interest is served because the invention is publicly disclosed, so anyone can improve the invention and patent that advancement. And anyone can design around it and patent that invention. If the invention has commercial value, no doubt many people will jump in and do one or both.

I recently delivered a keynote address at a special session of the AUTM Annual Meeting, where the Advanced Medical Technology Association (AdvaMed) released its new University Technology Transfer Best Practices Guide. Following is a transcript of that speech.

Marshall, Texas has been, and will likely continue to be, one of the major patent litigation cities in the United States. But, Waco, Texas is quickly becoming the new mecca for patent infringement lawsuits due to recent case law and the arrival of a patent-savvy district judge. In the world of patent litigation, we all know Marshall, Texas. The Eastern District of Texas—which includes the Marshall Division—is known to be one of the largest as far as numbers of patent litigation lawsuit filings in the U.S. The economic impact on the region has been significant, as service industries such as hotels, temporary offices, restaurants and catering companies grew to serve the regular flow of litigators and their clients coming to Marshall for hearings and trials from around the country. Several national and regional law firms specializing in patent litigation opened satellite offices in and around Marshall to serve their frequent needs for access to the busy courthouse.

This week is quiet on Capitol Hill with Presidents’ Day on Monday, after which the House of Representatives enters a district work period and the Senate is out of session for the rest of the week. However, Washington, D.C., will still host a series of events related to intellectual property, innovation, and technology. Counsel and amici appearing before the U.S. Supreme Court in Mission Product Holdings Inc. v. Tempnology, LLC on Tuesday will offer post-oral argument reflections this Wednesday at the American University Washington College of Law. Earlier that same day, the Information Technology & Innovation Foundation looks at the policy debate surrounding the U.S. Postal Service in the e-commerce era. This week in IP, business and tech policy wraps up on Thursday with a look at lunar tech commercialization and other legal matters related to Moon exploration by the Washington Space Business Roundtable.

The Federal Circuit recently issued an opinion affirming the decision of the United States District Court for the District of Massachusetts, which held that Athena’s medical diagnostic methods were directed toward laws of nature and patent ineligible under 35 U.S.C. § 101. Athena Diagnostics, Inc. v. Mayo Collaborative Servs., LLC, No. 17-2508, 2019 U.S. App. LEXIS 3645 (Fed Cir. Feb. 6, 2019) (Before Newman, Lourie, and Stoll, Circuit Judges) (Opinion for the Court, Lourie, Circuit Judge) (Dissenting Opinion, Newman, Circuit Judge).
The inventors of U.S. Patent 7,267,820 (the 820 Patent) discovered that about 20% of patients with the neurological disorder myasthenia gravis (MG) generate autoantibodies to a membrane protein called MuSK. Until their discovery, no disease had ever been associated with the protein. The ‘820 patent disclosed and claimed methods for diagnosing neurological disorders by detecting antibodies that bind to MuSK. Athena Diagnostics (Athena), the ‘820 Patent’s exclusive licensee, sued Mayo Collaborative Services (Mayo) for infringement. Mayo moved to dismiss, and the district court granted Mayo’s motion, concluding that the patent claimed ineligible subject matter and was invalid under 35 U.S.C. § 101. Athena appealed, and the Federal Circuit affirmed.

Most inventors understand that a certain amount of paranoia goes a long way when dealing with an idea or invention. Ideas cannot be patented, but every invention starts with an idea. When you have an idea that has been sufficiently formulated and described in a provisional patent application, you may even be able to license that invention idea without yet having received a patent. This all falls apart if you tell others about your invention or otherwise disclose your invention before a patent application is filed. Worse, if you tell someone your idea without a confidentiality agreement, they are free to use the idea without paying you anything. It can feel like the wild west sometimes for inventors seeking to become entrepreneurs—whether their dreams are to license inventions, to build a company to sell a product, or to offer a service representing the invention. Once your idea crosses the idea-invention boundary (discussed here), you can receive a patent, provided of course that it is new and nonobvious. But if you start telling others about your invention, they could make and use your invention without paying you—which is bad enough, but the mere act of someone else moving forward with your idea could forever prevent you from obtaining a patent.

The Federal Circuit recently overturned a Patent Trial and Appeal Board (Board) inter partes review decision finding that an IPS Group (IPS) patent was not unpatentable as anticipated, holding that the Board erred when determining the inventive entities of the asserted IPS patent and the asserted prior art, which was a different IPS patent that shared an inventor with the other IPS patent. See Duncan Parking Techs. v. IPS Group, Inc., Nos. 2018-1205, 2018-1360, 2019 U.S. App. LEXIS 3137 (Fed. Cir. Jan. 31, 2019) (Before Lourie, Dyk, and Taranto, J.) (Opinion for the Court, Lourie, J.). The claims at issue related to parking meter technology. IPS has two relevant patents for this technology, the ’310 patent and the ’054 patent. The ’054 patent issued in 2013 from a 2006 Patent Cooperation Treaty (PCT) application. It named the Founder of IPS, Dave King, and the Chief Technical Officer of IPS, Alexander Schwarz, as inventors. The ’310 patent was issued in 2010 and based on an application filed in 2008. The ’310 patent named King, along with three other engineers, as inventors. The ’310 patent, however, did not disclose Schwarz as an inventor.

Since having been sworn in as the new director of the U.S. Patent and Trademark Office (USPTO) in February 2018, Andrei Iancu has led the charge to improve predictability of patent-eligible subject matter. In his speech at the Intellectual Property Owners’ (IPO) Association’s annual meeting in Chicago in late September 2018, the director told IPO’s membership that the USPTO is “contemplating revised guidance to help categorize the exceptions [to patent eligibility]—and indeed to name them—and instruct examiners on how to apply them.” Moreover, Director Iancu had created a new post that coordinates between the Patent Trial and Appeal Board (PTAB) of the USPTO and the examining corps, and he installed former PTAB Chief Judge David Ruschke to that post in August 2018. True to his word, on January 7, 2019, Director Iancu issued “2019 Revised Patent Subject Matter Eligibility Guidance,” which explains how U.S. Patent Examiners should analyze patent-eligibility questions under the judicial exception to 35 U.S.C. § 101. See 84 Fed. Reg. 50-57 (Revised Guidance). In less than two weeks since the Revised Guidance, the PTAB issued two decisions reversing examiners’ 35 USC § 101 rejections based on the Revised Guidance—ex parte Rockwell, Appeal No. 2018-004973, Jan. 16, 2019; and ex parte Fanaru, Appeal No. 2017-002898, Jan. 22, 2019.

Here we go again! Another patent whose claims have been invalidated at the Federal Circuit—predictably, another medical diagnostic patent. Athena Diagnostics v. Mayo Collaborative (Fed. Cir. Feb. 6, 2019). This is getting old, tired and fundamentally ridiculous. The statute, which is all of one-sentence long, specifically lists discoveries as patent eligible. So why are discoveries being declared patent ineligible? To the extent these decisions are mandated by the Supreme Court, they directly contradict the easy to understand and very direct language of the statute. The Federal Circuit is wrong, period. Perhaps they are so close to these cases and trying so hard to do what they think is right that they have lost perspective, but these rulings are fundamentally saying that discoveries are not patent eligible. We are told repeatedly that they are mandated by Supreme Court precedent. Obviously, that cannot be correct. The statute says: “Whoever invents or discovers… may obtain a patent…” Clearly, Congress wants discoveries to be patented, and in our system of governance, Congress has supremacy over the Supreme Court with respect to setting the law unless the law is unconstitutional. 35 U.S.C. 101 has never been declared unconstitutional, so discoveries must be patent eligible, period. It is time to face the facts—the Supreme Court has considered only bad cases, with bad facts, where there was really no innovation presented in the claims, or even in the patent application as a whole. These decisions have absolutely no meaning or proper application with respect to any inventions, let alone inventions of monumental complexity such as true artificial intelligence, autonomous vehicles, or new medical diagnostics that allow risk-free testing of common ailments, where previously existing tests required potentially catastrophic risk.

The Federal Circuit on February 1 affirmed the Patent Trial and Appeal Board’s final written decision in an inter partes review concluding that the claims of a patent directed to a composition for treating epilepsy are not unpatentable. The Federal Circuit first visited the issue of whether three petitioners—Mylan Pharmaceuticals, Breckenridge Pharmaceuticals, and Alembic Pharmaceuticals, all of whom were sued for infringement of the patent more than one year prior to the institution of the IPR, and all of whom were joined in the IPR under 35 U.S.C. § 315(c)—had standing to appeal the Board’s final decision. The Court held that the petitioners had a statutory right, under 35 U.S.C. § 319 to appeal.

Patent professionals encounter many different personality types working with their colleagues and inventors. On one end, there are those who do great work but lack confidence in their abilities, and on the other there are those who overestimate their abilities and lack the skills to do an efficient job. Those who are competent, but lack confidence, often believe others are smarter and more capable then they are. This can be particularly problematic when that individual is an engineer or scientist hired by a company to invent, or even an independent inventor who toils for years thinking that what they are doing just isn’t good enough. Building confidence in those who have creative abilities seems like a difficult task, but it can be even more challenging to work with someone who believes they are great at what they do when they clearly lack abilities, or what they do create is a modest improvement, or even trivial advance that the law is unlikely to recognize as a patentable invention. These individuals typically are completely unaware that they lack the necessary skills, they overestimate their contributions, and often become extremely defensive or even angry when others do not seem to appreciate what they consider to be their own brilliance. This phenomenon is not uncommon and has even been given a name by two psychologists who studied how individuals at different ends of the spectrum see themselves and the value of their contributions—the Dunning-Kruger Effect. The Dunning–Kruger Effect is based on the principle that, in order to know you are bad at something you must have at least a moderate understanding of it. Thus, when an individual lacks ability in a certain area, they cannot recognize that they are lacking. That is, in order to recognize their deficiencies, they must have at least a moderate understanding of the subject.

On February 7, the Global Innovation Policy Center (GIPC) of the U.S. Chamber of Commerce held its 2019 U.S. Chamber International IP Index Reception to announce the findings of this year’s International IP Index, which saw the United States patent system shoot from twelfth place last year to second place this year. Following are remarks delivered by United States Patent and Trademark Office Director Andrei Iancu at the event, after being introduced by GIPC President and CEO, David Hirschmann.